MINUTES OF THE REGULAR MEETING
OF THE ORTONVILLE CITY COUNCIL
COUNTY OF BIG STONE, STATE OF MINNESOTA
MONDAY, MAY 17, 2004 7:00 P.M.
SENIOR CITIZENS CENTER
CALL TO ORDER AND ROLL CALL:
Mayor Dinnel called the regular
meeting of the Ortonville City Council to order at 7:00 P.M. Roll call
was taken with the following being present: Mike Dorry, Artie Arndt,
Lenore Sellin, Lisa Berkner, Mel Reinke with the following absent: Dan
Oakes. City Staff Present: Char Grossman, Curt Hormann, Mark Brown.
Others present: Tom Koop, Jerry Jorgenson, Elsie Perrine, Vicki Oakes,
Tom Oakes, Karen Oakes, Arloa Ronglien, Todd Verheul, Sara Verheul. Media
present: Holly Hilbrands, Ryan Stattelman.
AGENDA
AMENDMENTS:
A motion was offered by Arndt and
seconded by Sellin and did pass unanimously to approve the agenda as
amended:
Bids for the 2004 Seal Coat project
were opened and one bid was received in the amount of $20,000.00 from
Bituminous Paving, Inc. A motion was made by
Dinnel and seconded by Reinke and the motion did pass unanimously to refer
the matter to the Street Committee for further deliberation and
recommendations.
Bids for the 2004 Street
Rehabilitation Project were opened and one bid was received in the amount
of $3,500.00 from Highway Improvement, Inc. A
motion was made by Reinke and seconded by Dorry and the motion did pass
unanimously to refer the matter to the Street Committee for further
deliberation and recommendations.
Todd Verheul, representing the Airport
Board, updated the council on the process of interviewing engineering
firms. Three firms have been interviewed and the board is recommending
Short, Elliott & Hendrickson, Inc. for the completion of an Airport Layout
Plan-Master Plan. Upon the recommendation of the Airport Board,
a motion was made by Reinke and seconded by Berkner and
the motion did pass unanimously to secure the engineering firm of Short,
Elliott & Hendrickson, Inc. for the completion of the Airport Layout
Plan-Master Plan.
Tom Koop, Larson, Allen, Weishair &
Co., reviewed the 2003 financial audit of the City of Ortonville and
distributed the draft copy for council members to review. Ortonville is
in a good financial condition considering the LGA cuts and have even
improved compared to 2002. Tom is recommending that the council make a
decision in the fall regarding the type of audit that will be done for
2004. Since Ortonville is a town of less than 2,500 we are not required
to comply with the GASB 34 regulations but it may be a way of better
tracking assets of the City. The cost of a GASB audit would be
approximately an additional $5,000 for the first year.
CONSENT AGENDA:
Dinnel asked if there were any
additions, corrections, or deletions to be made to the Consent Agenda.
Deletions -13.a Corn
Festival Fire Works
Motion was made by Reinke and
seconded by Berkner, to approve the Consent Agenda which included the
following items:
9.a Motion approving proposed council
minutes of May 3, 2004.
9.b Motion approving proposed special
council minutes of May 7, 2004.
11.a Reinke moved and
Berkner seconded that the following resolution be adopted:
RESOLUTION 04-033
RESOLUTION APPROVING THE APPLICATION OF CHLORIDE ON RITA
ROAD
BE IT AND IT IS HEREBY RESOLVED by the
Council of the City of Ortonville that Big Stone County applies chloride
to Rita Road for dust control as recommended by the Street Committee in
the amount of $600 be and is hereby approved.
Upon roll call vote the following
voted aye: Sellin, Berkner, Dinnel, Arndt, Dorry, Reinke and the following
voted nay: none.
Resolution 04-033 passed this 17th
day of May 2004.
APPROVED:
____________________
David Dinnel,
Mayor
ATTEST:
_____________________
Charleen K. Grossman,
City Clerk-Administrator
13.b Motion approving Health Care
Foundation Board raffle permit for Oak Tree Classic on September 11, 2004.
13.c Reinke moved and Berkner seconded
that the following resolution be adopted:
RESOLUTION 04-034
BUSINESS
SUBSIDY POLICY
A BUSINESS
SUBSIDY POLICY FOR TRADITIONAL BUSINESS SUBSIDY
and
JOBZ
BUSINESS SUBSIDY DEVELOPMENTS
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
RESOLUTION
OF THE
CITY
OF ORTONVILLE
Its Resolution #04-034 entitled
“Business Subsidy Policy and Criteria”
May 17, 2004
RESOLVED by the City Council of the City of
Ortonville that it shall adopt the following Business Subsidy Policy
and Criteria:
Preamble. Whenever the City of Ortonville
invests public funds or agrees to voluntarily forfeit tax or other revenue
that benefit private development projects, those projects should create
the greatest number of FTE jobs that pay a living wage possible for the
residents of the City of Ortonville and the surrounding region. City of
Ortonville policy makers and economic development agents must keep the
critical need for living wage FTE jobs the priority whenever public
dollars are invested in a private business or development project.
Business Subsidy Public Purpose. The public
purposes of this policy shall be to accomplish the following on behalf of
the City of Ortonville:
A.
Enhance economic growth in this area
B.
Create high quality job growth in this area
C.
Retain high quality jobs in this area
D.
Stabilize the community
E.
Other specified purpose
This policy is adopted in
compliance with M.S. § 116J.994 Subd. 2. A
copy of the policy shall be submitted to the Department of Employment and
Economic Development along with the first annual Business Subsidy report.
Principles of Business Subsidy
Implementation.
The City of Ortonville shall target its business subsidy
assistance to businesses that demonstrate a clear and ongoing commitment
to the community by providing living wage jobs to their employees and to
City of Ortonville residents, where applicable, by giving priority to
those businesses over businesses that have not traditionally paid living
wages.
The City of Ortonville
shall focus its business subsidy assistance only to
businesses which agree to comply with annual business subsidy reporting
requirements as required by Job
Opportunity Building Zone (JOBZ) statute M.S. §§
469.310 - 469.320; and/or as required by
the Business Subsidy statute M.S.
§§ 116J.993 - 116J.995.
All other things being equal and
to the extent legally possible, the City of Ortonville shall give
preferential treatment for business subsidies to businesses that engage in
responsible labor relations defined as neutrality on union organizing.
Although the primary purpose of
this policy is the creation of living wage jobs, we cannot achieve our
economic development goals without a trained and ready workforce and
adequate childcare. The City of Ortonville shall commit to assist
businesses to obtain trained and work-ready employees through the DEED
Workforce Development Centers; MNSCU and other services; and to facilitate
access to childcare.
The City of Ortonville
agrees to require
that a qualified business shall not compete with or displace local
businesses currently operating within the subzone community.
I. DEFINITIONS
“Authorized Business Subsidy Signatory” means Economic
Development Authority
who is authorized by this Policy to
execute business subsidy agreements on behalf of the City of
Ortonville.
“JOBZ Business Subsidy” means
tax exemptions or tax credits available to a qualified business located in
a job zone under the Job Opportunity Building Zone (JOBZ) statute
M.S. §§ 469.310 - 469.320.
JOBZ Business (OPTIONAL SECTION)
Subsidies shall include:
A.
Exemption from
individual income taxes as provided under M.S. §
469.316;
and
B.
Exemption from
corporate franchise taxes as provided under M.S. §
469.317;
and
C.
Exemption from the
state sales and use tax and any local sales and use taxes on qualifying
purchases as provided in M.S. §
297A.68,
subdivision 37; and
D.
Exemption from the
state sales tax on motor vehicles and any local sales tax on motor
vehicles as provided under M.S. §
297B.03;
and
E.
Exemption from the
property tax as provided in M.S. §
272.02,
subdivision 64; and
F.
Exemption from the
wind energy production tax under M.S. §
272.029,
subdivision 7; and
G.
The jobs credit
allowed under M.S. §
469.318.
“Business Subsidy” means a
state or local government agency grant, contribution of personal property,
real property, infrastructure, the principal
amount of a loan at rates below
those commercially available to the recipient, any reduction or deferral
of any tax or any fee, any guarantee of any payment under any loan, lease,
or other obligation, or any preferential use of government facilities
given to a business, and as defined by the Business Subsidy statute M.S.
§§ 116J.993 - 116J.995. Business subsidies shall include, but not be
limited to:
H.
Loan
I.
Grant
J.
Tax
abatement
K.
TIF
or other tax reduction or deferral
L.
Guarantee of payment
M.
Contribution of property or infrastructure
N.
Preferential use of governmental facilities
O.
Land
contribution
P.
Other specified subsidy.
Business subsidies do not include the following:
Q.
assistance of less than $25,000.
R.
assistance that is generally available to all businesses or to a
general class of similar businesses, such as a line of businesses, size,
location or similar general criteria;
S.
public improvements to buildings or lands owned by the City of
Ortonville that serve a public purpose and do not principally
benefit a single business or defined group of businesses at the time the
improvements are made;
T.
property polluted by contaminants being redeveloped as defined in
M.S. § 116J.552, subd. 3.
U.
assistance provided for the sole purpose of renovating old or
decaying building stock or bringing it up to code and assistance to
designated historic preservation sites or districts, provided that the
assistance is equal to or less than 50% of the total cost of the
development;
V.
assistance to provide job readiness and training services;
W.
assistance for housing;
X.
assistance for pollution control or abatement, including assistance
from a TIF hazardous substances subdistrict;
Y.
assistance for energy conservation;
Z.
tax reductions resulting from conformity with federal tax law;
AA.
workers compensation and unemployment compensation;
BB.
benefits derived from regulation;
CC.
indirect benefits derived from assistance to educational
institutions;
DD.
funds from bonds allocated under M.S., Chapter 47A refunding bonds
and 501(c)(3) bonds;
EE.
assistance for collaboration between a Minnesota higher education
institution and a business;
FF.
assistance for a tax increment financing soils condition district
as defined under M.S.469.174, subd.19;
GG.
redevelopment when the Recipients or Qualified Business’ investment
in the purchase of the site and in site preparation is 70 percent or more
of the assessor’s current years estimated market value;
HH.
general changes in tax increment financing law and other general
tax law changes of a principally technical nature;
II.
federal assistance until the assistance has been repaid to and
reinvested by the local governmental unit;
JJ.
funds from dock or wharf bonds issued by a seaway port authority;
KK.
business loans or loan guarantees of $75,000 or less; and
LL.
federal loan funds provided through the U.S. Economic Development
Administration.
“Business Subsidy Report” means
the annual reports submitted each year for each business receiving a
business subsidy in the community. The report is submitted by the LGU in
order to comply with M.S. § 116J.994 Subd. 7. (b).
“Criteria” means the equitably
applied, uniform standards by which the Economic Development Agent and /or
the City of Ortonville bases its decision to award any business subsidy to
a private business or development project establishing a business and
creating jobs in the City of Ortonville.
“DEED” means Minnesota
Department of Employment and Economic Development.
“Economic Development Agent”
means the City of Ortonville department, local or regional economic
development agency or other authorized entity that is empowered to
solicit, negotiate and form business subsidy agreements on behalf of the
City of Ortonville.
The Economic Development Agent for the
City of Ortonville shall be the Economic Development Authority,
hereinafter “Agent”.
“Health Insurance” means basic group health insurance that
is available to full time employees of the recipient.
“Living Wage Job” shall mean a
job which pays wages and health benefits that total at least the rate of
110% of the current poverty level for a family of four.
“Local Governmental Unit”
hereinafter LGU, means the statutory or home rule charter City of
Ortonville, county, town, iron range resources and rehabilitation agency,
regional development commission.
“Operation Start Date” shall mean
the date by which the business begins its operations in the zone as
evidenced by constructing a facility or relocating to an existing building
in a facility and beginning revenue generating operations and/or hiring
employees.
“Qualified Business” means a
person that carries on a trade or business at a place of business located
within a Job Opportunity Building Zone as referenced in M.S. § 469.310
Subd. 11; and complies with the reporting requirements specified by M.S. §
469.313 Subd. 2. (5); and shall comply with the criteria in Section II.C.
of this agreement; and shall also mean “Recipient” as defined by Business
Subsidy law. A qualified business shall not include a retail business, a
low-wage service business, an agricultural production business, or a
business that pays less than the living wage defined in this agreement.
“Recipient” mean any business entity that receives a
business subsidy as defined by M.S. § 116J.993, and that has signed a
Business Subsidy Agreement with the City of Ortonville.
“Relocating Business” A business relocating from another
Minnesota non-JOB Zone location.
“Relocation Agreement” means a binding written agreement
between a relocating qualified business and the commissioner of DEED
pledging that the qualified business shall either: (a) increase full-time
or full-time equivalent employment in the first full year of operation
within the job opportunity building zone by at least 20 percent, or
(b) make a capital investment on the property equivalent to 10% of the
gross revenues of operation that was relocated in the immediately
preceding taxable year; and provides for repayment of all tax benefits if
the requirements of (a) or (b) are not met.
“Subzone” means the parcel or parcel of land designated by
the Commissioner of Employment and Economic Development within a Job
Opportunity Building Zone within the boundaries of Ortonville to receive
certain tax credits and exemptions specified under M.S. § 469.310-469.320.
“Zone” means a Job Opportunity Building Zone or an
Agricultural Processing Facility Zone designated by the commissioner of
Employment and Economic Development under M.S. §
469.314.
II. BUSINESS SUBSIDY REQUIREMENTS
MM.
Business
Subsidy Policies. The City of
Ortonville
adopts the following:
1.
Any time the
City of Ortonville provides a
business subsidy to a Qualified Business
or recipient, that business is subject to the wage levels, job creation
and other criteria set forth in this policy and specified in the Business
Subsidy Agreement made with the LGU. In the event of a conflict between
the requirements of the Business Subsidy statute M.S. §§ 116J.993 -
116J.995 and the JOBZ statute
M.S. §§ 469.310 - 469.320, the JOBZ statute shall
supersede.
2.
The
recipient, in the case of a quantifiable non-JOBZ business subsidy, shall
create and/or retain at least one full-time living wage job and which
provides basic health benefits as committed within the JOBZ policy for
each $25,000 of business subsidy received. These jobs shall be created
not later than a date mutually agreed upon by the LGU and recipient.
3.
The
qualified business, in the case of a JOBZ business subsidy that is
non-quantifiable at the time of the Business Subsidy Agreement, must
create and retain for the period of the Job Zone duration or until
December 31, 2015, all of the jobs committed to in the Business Subsidy
Agreement. These jobs shall be created not later than a specific date
identified in a Business Subsidy Agreement.
4.
The
qualified business shall be identified in the Business Subsidy Agreement
as a:
a.
Trade or
business located in and operating in a JOBZ or APF Zone at the time of
Zone designation; OR
b.
New trade or business start-up located with the subzone;
OR
c.
Business expanding in the subzone which
is a business that maintains its current operations in its current
location and is expanding its operations and its payroll within the
City of Ortonville subzone; OR
d.
A business relocating from another state; OR
e.
A business relocating from another
Minnesota non-Zone location specifying the City of Ortonville.
5.
The City of
Ortonville may deviate from wage and job criteria in Section II, by
documenting the reason in writing for the deviation and attaching a copy
of this reason to the next annual Business Subsidy Report submitted to
DEED.
6.
The
City of Ortonville shall have as its overall GOAL that 100% of new
FTE jobs created under this policy shall be held by City of Ortonville
residents. It is expected that all qualified businesses or recipients
shall have a quantified target for the number of residents to be hired.
7.
The
City Council of Ortonville authorizes the Mayor and EDA President, as
representatives of the City to act as its Authorized Business Subsidy
Signatories to execute business subsidy agreements on behalf of the City
of Ortonville.
NN.
The City Council of Ortonville authorizes EDA President to
act as its Economic Development Agent for purposes of marketing,
initiating and negotiating Business Subsidy Agreements and executing
Business Subsidy Agreements on its behalf.
OO.
Requirements of businesses.
The City of Ortonville of shall require all businesses receiving a
business subsidy to comply with the following:
1.
The business shall attend a properly
noticed public hearing held by the City of
Ortonville as provided by M.S. § 116J.994, when the value of the
subsidy does or is expected to exceed $100,000 from local sources. The
purpose of the hearing shall be to identify and define the criteria that
the qualified business or recipient shall meet in order to be eligible to
receive a business subsidy or become a qualified business for purposes of
the JOBZ statute. The hearing shall specify the subsidy provided, public
purpose(s) that shall be achieved by offering the subsidy, and shall
specify the measurable, specific, and tangible goals committed to by the
qualified business. As provided by M.S. 116J.994, Subd. 5., a public
notice shall be published in print and if possible, on the internet, at
least 10 days prior to the hearing, identifying the location, date, time,
and place of the hearing and providing information about the business
subsidy proposed, including a summary of the terms of the subsidy.
2.
If the business is qualified to receive JOBZ tax benefits, that
business shall agree to continue to operations in the jurisdiction where
the subsidy is used (the subzone) for the duration of the job zone term.
3.
If the qualified business or recipient is a relocating business
under the definition in this agreement, the business shall be required to
enter into a binding written Relocation Agreement between the qualified
business and the commissioner of DEED pledging that the qualified
relocating business shall:
(a)
Commit to signing a Relocation Agreement with DEED; and
(b)
Increase full time employment by 20% (measured relative to the
operations that were relocated) within the first full taxable year of
operation within the Zone and maintains the required level of employment
during each year of zone designation; and/or
(c)
Make a capital investment in the Zone
equivalent to at least 10% of gross revenues for the taxable year
immediately preceding relocation to the Zone.
d. The business shall identify an operation start date when
business operations for the proposed qualified business are planned to
begin in the zone. The date when business operations begin is called the
“operation start date”.
PP.
Application Fee
1.
Applicants for JOBZ Business Subsidies are subject to an
application fee of ½ of 1% of the past year’s business payroll (if an
existing business) or the first year’s projected payroll (if a new
business).
2.
This fee is payable upon signing the Business Subsidy Agreement
between the LGU and the Recipient.
QQ.
Reporting Fee
1.
The recipient is obligated to pay an
annual fee to the LGU in the amount of $200. This fee is meant to
offset the cost of completing and submitting the Business Assistance
Report required by the State. Due payable annually by January 31st.
2.
All information about the Recipient
required to complete the Business Assistance Report must be provided to
the LGU annually by January 31st for the previous calendar year
for the duration of the requirements of the Business Subsidy Law or the
JOBZ Law.
RR.
Related Development Costs
1.
Cost, which may be assessed back to the business for the
construction, extension or expansion will be negotiated between the LGU
and the recipient.
2.
The negotiated agreement shall become part of Business Subsidy
Agreement.
Upon roll call vote the following
voted aye: Sellin, Berkner, Arndt, Dorry, Dinnel, Reinke and the following
voted nay: none.
Resolution 04-034 passed this 17th
day of May 2004.
APPROVED:
____________________
David Dinnel,
Mayor
ATTEST:
_____________________
Charleen K. Grossman,
City Clerk-Administrator
15. Motion approving
payment of bills as presented.
With all members voting in favor, the
motion carried.
RECOMMENDATIONS OF CITIZEN BOARDS,
COMMITTEES AND COMMISSIONS:
Arndt left the meeting.
Upon recommendation of the Border City
Tax Credit Committee, Berkner moved and Reinke
seconded and the motion passed unanimously approving the recommendations
of the February 2, 2004 meeting for tax credits to be approved for Big
Stone Therapies, Inc.- $12,330.00.
REPORTS FROM COUNCIL COMMITTESS:
Dorry offered the First Reading of Ordinance (Ordinance
04-04) pertaining to
Installation of five stop signs at the following locations:
South Minnesota and Atlantic Avenue – Stopping South
Minnesota
Two stop signs on Fourth Street at Lincoln Avenue
Two stop signs on Fifth Street at Jackson Avenue
Arndt returned to meeting.
Additional information has been
received from the City Attorney regarding the Waste Management Contract.
Berkner moved and Sellin seconded and the motion
passed unanimously approving referring the contract back to the Utility
Committee for further deliberation and recommendations.
UNFINISHED BUSINESS:
The recommendations from
Larson-Peterson & Associates, Inc. for the Hilltop sewer project was
reviewed. Dinnel moved and Reinke seconded and
the motion passed unanimously approving the referral of the
recommendations to the Utility Committee for further deliberation and
recommendations.
The completion of the new marina dock
was discussed. Due to weather conditions and other projects the
installation has been on hold. Will check with Tim Scherer on a
completion date.
Arndt questioned when the park board
will be meeting, and also if there has been discussion regarding the
granite along the Lakeside Park. Park board members will include the
granite issue on the May 20th park board agenda.
Clarification is needed as to where
the Corn Festival fireworks display will be launched.
Dinnel moved and Reinke seconded and the motion passed
unanimously to refer the permit application from Big Stone Lake Area
Chamber of Commerce back to them for more information.
At the November 3, 2003 meeting the
transferring of the Local Board of Appeal and Equalization duties to Big
Stone was discussed. No transfer was made at that time. The same
discussion occurred at the Board of Review meeting on April 14, 2004 and
upon the recommendation of the board this topic was to come back to the
City Council. Council Member Arndt felt that the City would lose control
if this transfer would happen. He is willing to attend the required
training sessions. A motion was made by Arndt
and seconded by Sellin and did pass unanimously to decline the offer of
combining the City’s Board of Appeal and Equalization with the County.
A donation will be received from a
walleye club for four benches to be installed by the City employees on the
dock. A motion was made by Arndt and seconded by
Sellin and did pass unanimously to accept the donation for the benches.
CLERK/ADMINISTRATOR REPORTS &
RECOMMENDATIONS:
Tom Koop and I have discussed the pros
and cons in regard to compiling with a GASB 34 audit. Since we are in the
process of changing computer accounting programs, I have been updating the
chart of account to comply with the GASB 34 audit. So if and when this
change might occur we would be prepared but will take considerable office
staff time for the conversion.
ADJOURNMENT:
There being no further business to
come before the Council, Berkner moved the
adjournment of the meeting and with no objections thereto, Dinnel
adjourned the May 17, 2004 meeting of the Ortonville City Council at 8:25
P.M.
Charleen K. Grossman, City
Clerk-Administrator
