HomeMy WebLinkAbout09/11/2000_Recessed• CITY OF ROCHESTER
COUNCIL AGENDA
MEETING NO. 18
ADJOURNED
PAGE
A) OPEN COMMENT PERIOD
B) CALL TO ORDER
C) LETTERS AND PETITIONS
SEPTEMBER 11, 2000
4:15 P.M., ROOM 104
(1-2) D) CONSENT AGENDAIORGANIZATIONAL BUSINESS
(3-4) 1) Owner Contract/Basic Construction in Kingsbury Hills Subdivision
(5-6) 2) Owner Contract/Basic Construction to Serve Diamond Ridge
Eighteen
(7-10) 3) Permit Parking Ordinance Amendments
E) HEARINGS
F) REPORTS AND RECOMMENDATIONS
(11-28) 1) City Administrator - Compliance with Truth in Taxation
Requirements
(29-44) 2) City Administrator - Findings of Fact and Conclusions of Law Relating
to Whether Road Constructors is a Reliable or
Responsible Bidder
G) RESOLUTIONS AND ORDINANCES
H) TABLED ITEMS
1) OTHER BUSINESS
J) ADJOURNMENT
REQUEST FOR COUNCIL ACTION MEETING
DATE: 9/11/00
A SECTION: ORIGINATING DEPT:
CONSENT AGENDA CITY ADMINISTRATOR
ITEM DESCRIPTION:
APPROVAL OF CONSENT AGENDA ITEMS
ITEM NO.
D-1-3
CAI l�ii-u/:�i W
This RCA lists all the items which have been included in the consent agenda for this meeting. The Council can
approve all of the items with a single motion to approve. The Council President will allow the Councilmembers
an opportunity to state whether there are any of these items which you wish to have removed from the consent
agenda approval and to have them discussed and acted upon separately by the Council.
The consent agenda for this meeting consists of the following RCAs:
D-1. Owner Contract/Basic Construction in Kingsbury Hills Subdivision
D-2. Owner Contract/Basic Construction to Serve Diamond Ridge Eighteen
D-3. Permit Parking Ordinance Amendments
COUNCIL ACTION REQUESTED:
„f L Motion to approve consent agenda items.
COUNCIL ACTION: Motion by: Second by: to:
REQUEST FOR COUNCIL ACTION MEETING
DATE:
9/11/00
SECTION:
ORIGINATING DEPT:
ITEM NO.
�ENDA
CONSENTAGENDA
Public Works
D
ITEM DESCRIPTION: Owner Contract — Basic Construction in Kingsbury Hills
PREPARED BY:
Subdivision (J9684)
M. Baker Q
Staff would offer the following Owner Contract project for consideration by the Council:
• Joel Bigelow & Sons Enterprises, Inc. (Owner) & Elcor Construction (Contractor) are requesting a
City / Owner Contract J9684 consisting of "Basic Construction in Kingsbury Hills Subdivision".
COUNCIL ACTION REQUESTED:
Adopt a Resolution authorizing the Mayor and City Clerk to execute the City / Owner Contract for J9684
"Basic Construction in Kingsbury Hills Subdivision"
COUNCIL ACTION: Motion by: second by: to:
REQUEST FOR COUNCIL ACTION MEETING
DATE:
`J
9/11/00
SECTION: ORIGINATING DEPT:
ITEM NO.
�ENDA
CONSENT AGENDA Public Works
j, — a,
ITEM DESCRIPTION: Owner Contract — Basic Construction to Serve Diamond Ridge
PREPARED BY:
Eighteen (J9650)
M. Bake
Staff would offer the following Owner Contract project for consideration by the Council:
• Western Walls, Inc. (Owner) & Elcor Construction (Contractor) are requesting a City / Owner
Contract J9650 consisting of "Basic Construction to Serve Diamond Ridge Eighteen".
ksti�Y7.
fob), st wy
COUNCIL ACTION REQUESTED:
Adopt a Resolution authorizing the Mayor and City Clerk to execute the City / Owner Contract for J9650
"Basic Construction to Serve Diamond Ridge Eighteen"
COUNCIL ACTION: Motion by: Second by: to:
REQUEST FOR COUNCIL ACTION MEETING
DATE
9-11-00
SECTION:
ORIGINATING DEPT:
ITEM NO.
INENDA
CONSENT AGENDA
Public Works
D - 3
ITEM DESCRIPTION: Permit Parking Ordinance Amendments
PREPARED By:
D. Rossma
This is a recommendation to change the Permit Parking Ordinance, R.C.O. #138 to clarify the following
two issues:
a) Expansion of Permit Parking Zones: The present ordinance allows for establishment of Permit
Parking Zones. Staff recommends adding criteria on expanding existing zones. The amendment
proposed would allow the expansion areas to be smaller than 30 dwelling units and would allow
sections within a zone that are not contiguous to each other.
b) Eligible Permittees: The current ordinance allows permits to be issued to employees of a
business facility permitted to locate and operate within the residential parking permit zone. Staff
would recommend that this be clarified to add employees of churches and schools within the
zone.
COUNCIL ACTION REQUESTED:
Amend the ordinance 138 Residential Permit Parking Zones to include the expansion of existing zones and the
addition employees of churches & schools as being eligible to purchase permits.
COUNCIL ACTION: Motion by: second by: to:
Am
ROCHESTER CODE OF ORDINANCES
138. RESIDENTIAL PERMIT PARKING ZONES
138.01. Establishment Authorized. The Common Council may,
following the procedures set forth in section 138.03, establish a
parking zone on a designated street or streets where only a resident
or employee of a business facility may lawfully park a vehicle
during hours in which parking is restricted by signs te—aresident.
138.02. Criteria for Establishment or Expansion of Zone.
Subdivision 1. No zone shall be established unless the following
criteria exist:
(a) The land abutting a street designated as part of the zone
is zoned for single family residential purposes;—
(h) The land abutting the streets designated as part of the
zone contain 30 or more residential dwelling units; and—
(c) The streets in the area contained in the zone are
adversely impacted by the parking of vehicles, during certain
hours, by e€ nonresidents of the area.
Subd. 2. No zone shall be expanded unless the following
criteria exist:
(a) The expansion area represents a minimum of one -block of
street frontage measured from intersection to intersection; and
(b) The street in the expansion area is adversely impacted by
the parking of vehicles, during certain hours, by nonresidents.
136.03. Procedure. No residential parking permit zone shall
be established or expanded unless a petition is filed with the city
clerk from the—c..___rs __ __s_rants sf at least sixty percent of the
owners or occupants of property abutting on a street residential
-
de:e'_linq u..___ contained within the proposed residential parking
permit zone. The city clerk shall refer the petition to the city
engineer, who shall report to the common council in writing his
January 8, 1999 - Update
ow
• CHAPTER 138. RESIDENTIAL PERMIT PARKING ZONES
recommendations with respect to establishment or expansion of the
proposed residential parking permit zone. Thereafter, if the common
council finds that the appropriate criteria exist, and that it is in
the public interest that the proposed residential parking permit
zone be established or expanded, the common council 1-t- shall
schedule a public hearing on the question of establishment or
expansion of the residential parking permit zone. Prior to the
hearing, mailed notice of said hearing shall be given at least 14
days prior thereto to the owners or occupants of property abutting
on a street proposed to be included in the proposed residential
parking permit zone. If, following the hearing, the common council
determines the petition satisfies the criteria provided in section
138.02, then it may establish or expand said zone by adoption of a
resolution amending the comprehensive parking resolution.
138.04 Permit Agglication Procedure Subdivision 1. A
resident of a dwelling unit which abuts a street contained within a
residential parking permit zone, and any employee of a business
facility permitted to locate and operate within the residential
parking permit zone, may obtain from the city clerk an annual permit
entitling the resident or employee to park a vehicle therein during
a time that parking is restricted to the same rresiden�.e. An
applicant shall be required to provide information relating to the
vehicle for which the permit shall apply, and evidence that he or
she resides in a dwelling unit or is employed at a business facility
which abuts a street contained in the residential parking permit
zone. For purposes of this chapter the term "business facility"
includes churches and schools.
Subd. 2. An application fee of $5.00 will be charged each
applicant for the initial application. An annual fee of $5.00 shall
be charged for each vehicle permit issued to an applicant, or a
member of the applicant's household. Said permit shall be valid for
the period from the first day of September to the 30th day of August
of the following year. There will not be a proration of the fee for
those making an application after the first of September.
January 8, 1999 - Update
459
io
ROCHESTER CODE OF ORDINANCES
138.05 Display of Permit. The permit issued shall be
permanently affixed on the inside of the rear window of the vehicle
for which it is issued. A permit shall not be transferable from one
vehicle to another, or from one person to another.
138.06. Unauthorized parkinct prohibited. (a) No person,
including a resident along the abutting street, shall park a vehicle
in a residential permit parking zone during a time in which parking
is restricted unless the vehicle displays a valid permit issued
pursuant to section 138.04, in the manner set forth in section
138.05.
(b) The prohibition contained in (a) of this paragraph shall
not be deemed to apply to a vehicle whose operator is making a
delivery or engaged in repair or construction work in a building
dwelling ent ai -a adjacent to a street within the residential
parking permit zone; a vehicle collecting solid waste; a school bus;
or a vehicle which is stopped temporarily for the purpose of picking
up a passenger.
138.07. Termination. The common council may terminate a
residential permit parking zone on its own initiative or at the
request of the persons residing therein, following a public hearing
where prior notice is given pursuant to the procedures set forth in
section 138.03.
(2604, 7/19/88; 2795, 3/3/92; 2875, 5/4/93; 3003, 8/22/95; 3048,
7/16/96; 3213, 12/22/98)
January 8, 1999 - Update
460
•
REQUEST FOR COUNCIL ACTION
MEETING I
DATE: 9/11/00
AVIDA
SECTION:
ORIGINATING DEPT:
ITEM NO.
REPORTS AND RECOMMENDATION
CITY ADMINISTRATOR
,F -
ITEM DESCRIPTION: COMPLIANCE WITH TRUTH IN TAXATION 5 QUIREMENTS
PREPARED BY:
S. KVENVOLD
Pursuant to the State mandated Truth in Taxation requirements, the City is required to take action on the following matters:
Certification of Preliminary Properly Tax Lew for 2001
The City is required to certify a 2001 preliminary property tax levy by 9/15/00. The final 2001 property tax levy may be
less than the preliminary property tax levy to be established at this time; however, it may not be greater.
A recommendation has been made to establish a 2001 preliminary property tax levy in the range of $18,900,000 to
$19,000,000 (see attached).
Adoption of a Proposed Budget Amount for 2001
The City is required to adopt a proposed budget amount for 2001, which may be increased or decreased at the time of
budget adoption.
I recommend a preliminary 2001 budget amount of $110,000,000.
Tax Rate Authorization Hearing
The State Legislature requires cities to hold a public hearing and adopt a resolution which allows the City to increase the
property tax rate.
p,
Selection ofHearine Dates for the Proposed 1001 Budget
lY
The City is required to hold public hearings on the proposed 2001budget.
The following hearing dates are recommended:
Tax Rate Authorization Hearin e Monday, October 16, 2000, at 7:00 p.m.
u
Initial Bucket Hearin e Monday, DecemberX 2000, at 7:00 p.m.
Continuation Hearing (If Needed) Monday, December 4. 2000, at 7:00 p.m.
Adoption of 2001 Budget Monday, December 18, 2000, at 7:00 p.m.
COUNCIL ACTION REQUESTED:
Request a motion approving a preliminary 2001 property tax levy, the 2001 budget sum and the 2001 proposed budget
hearing dates.
rn
4(2ifqrre�
COUNCIL ACTION: Motion by: t��Cl�+�— Second by: I" 4A�r_ to: Y ��
Ia
Memo
TO: Mayor and City Council
From: Stevan E. Kvenvold A(
Date: September 1, 2000
Subject: Preliminary Property Tax Levy for 2001
State law requires that the City Council adopt a preliminary property tax levy for the
budget year 2001 by September 15, 2000. The City Council may adopt a final 2001
property tax levy which is less than the preliminary levy; however, the final levy amount
may not exceed the preliminary levy.
A State imposed maximum property tax limit does not exist for the 2001 budgetyear.
The attached material prepared by the Finance Department provides some information
on estimates of major revenues for 2001 and three property tax levy scenarios for
2001.
The minimum property tax levy of $17,841,346 would maintain the operation of the
organization as it exists in 2000. It would not allow for the addition of any new
positions or for any new initiatives such as the recent request from the Neighborhood
Association for $50,000 in 2001 to fund a Neighborhood Coordinator position.
The City is continuing to experience considerable growth in the area of the City and
some expansion in property tax levy will be needed in order to provide a satisfactory
level of City services to the new and existing areas.
I recommend a preliminary property tax levy in the range of $18,900,000 to
$19,000,000. This would allow for the preparation of a 2001 budget that would
accommodate some of the increased demands placed upon the City organization by the
rapidly growing community.
I would request that the 9(6(00 Council meeting be continued to 4:15 p.m., Monday,
September 11, 2000, in Room 104, City Hall to discuss this matter and adopt a 2001
preliminary property tax levy.
13
DATE:
TO:
FROM:
SUBJECT:
August 30, 2000
Stevan Kvenvold, City Administrator
Dale Martinson, Director of Finance
Preliminary Levy and Budget
FINANCE DEPARTMENT
VNTMORT3,91-mill u
We will need to approve a preliminary levy, a total budget and establish hearing dates
for the 2001 budget prior to September 15tn. I have provided you with scenarios for the
preliminary 2001 budget as well as a picture of the market value growth in the City for
pay 2001.
The various scenarios provide a range for consideration of a preliminary levy based
upon new employee requests and information we have to date on other revenue
sources. It is important to remember that once we set the preliminary levy we cannot
increase that levy though we can always lower it based upon new information up until
the final adoption scheduled for December 18tn
The following key points should be considered when reviewing this information:
Community Growth and Inflation Considerations
• Total Estimated Market Valuation for pay 2000 increased nearly 16% due to
revaluations (inflation), annexations, and new construction.
Pay 2000 Est. Market Valuation $
Plus:
New Construction $
Increase in Mkt Value (Inflation) $
Percent Increase
Amount From Prior Year Total
3,484,350,300
161,540,600 4.6%
389,852,800 11.2%
Pay 2001 Est. Market Valuation $ 4,035,743,700 15.8%
New construction alone amounted to $161.5 million representing 4.6% of
growth in our City in one year. However, please remember that while we now
need to provide Citv services to this new arowth. we aain no additional taxes
from these properties unless we levv more —their Drooertv taxes otherwise iust
o to reduce existing taxpayer's bills
Market Valuation. The increase in market valuation is one method of tracking
inflation... at least inflation in real estate values... when looking over a long period
(� Preliminary Levy and Budget 2001
Page 2 of 3
of time. Part of the 11.2% increase in the City's valuation of existing properties
reflects the high demand for property in this community. It is true that our
inflation in costs of providing services to these properties may not go up (or
down) in exactly the same proportion. But it is true that we have inflation in our
costs in addition to having to serve an ever-growing City. If revenues are not
increased for both inflation and new growth, we cannot keep up with the
demands of providing City services over the long haul.
Other Inflation Measures. It is true that inflation for one person or business is
different than another, but to find some consistent measure of inflation from year
to year, the U.S. Bureau of Labor Statistics tracks prices of many goods and
aggregates them into a Consumer Price Index. That index has recently started
to rise and was at 3.5% for the 12 months ended in July of 2000 (current
information attached).
"Reasonable" levy increase. Combining the community growth due to new
construction of 4.6% plus the 3.5% rate of inflation (as an approximation of the
increased cost of doing business) could suggest that a total levy increase of as
much as 8.1 % would not be "unreasonable" from a "big -picture" perspective.
Current Budget Projections
In reviewing specific details known at this point about the City's budgetary position for
next year, we have put together the attached scenarios that include various
assumptions:
Revenue Assumptions
Key revenue sources for which we have specific information about or have reason
to believe will be significantly different in 2000 have been listed separately. All other
revenues have assumed about a 1 % growth based upon our historical record of
adjusting fees.
Police and Fire Pension Aid will no longer exist due to the merger of these plans
with PERA. The expenses for those plans have also gone away.
Expense Assumptions
• Employee health care costs are currently estimated at a 8% increase over last
year with dental estimated at 2% over last year. Our stop -loss carrier is suggesting
much higher expected claims, but I believe the fund can remain strong at this level
of increase. (They were wrong last year, too.)
• Expenses for existing employees assume salary increases as listed in current
contracts or 3% for all others.
• The City's share of employee expenses under the COPS grant approved by the
Council for submittal has been listed in the "minimum levy" scenario since we are
committed if the grant is approved.
• Capital outlay has been listed based upon requests received.
• All other expenses have been arbitrarily listed at a 3% increase. We have not
evaluated other departmental expense requests at this stage. Some requests are
significantly over this 3% assumption.
1s
Preliminary Levy and Budget 2001
Page 3 of 3
• Additional expenses listed in the "preliminary levy" scenarios include either 1)no
new requested employees being approved, 2) A increase in expenses of $600,000
being provided for new employee or other "extra" needs / requests, or 3) An
increase of $883,000 to cover all current requests for new employees for 2001.
There is still much work to do and further information to obtain before we can definitively
set the minimum levy needed to provide appropriate services to the City. The
discussion about possible annexations and the required additional costs to serve them
is just one example that has not been addressed in these scenarios. I encourage
consideration of setting the preliminary levy at a level sufficient to work with these
issues and estimates up until the final levy decision needs to be made.
(6
2000 Operating Budget Scenarios
# 1 - Preliminary Levy - Minimum
Govermental Only
200u
Budget
2000
"What IT'
Amount
Change
Percent
Change
Revenues
(Max Levy)==>
17,841,346
Property Tax Levy
17,600,000
18,302,746
702,746
4.0%
Less: Levy to CIP
(1,346,582)
(1,386,979)
(40,397)
3.0%
Add'I CIP Levy -Streets
Less: Levy to Sewer Ent.
(154,426)
(154,426)
-
0.0%
Net Property Tax For Operating:
16,098,992
16,761,341
662,349
4.1 %
Hotel/Motel Tax
1,900,000
1,900,000
-
0.0%
Building Permits
1,400,000
1,618,5D0
218,500
15,6%
Cable Franchise
520,000
800,000
280.000
53.8%
Fines
363,000
408,000
45,000
12.4%
Unfunded Pension Aid (estimate)
40,000
-
(40,000)
-100.0%
HACA
4.369,974
4,370,953
979
0.0%
Local Performance Aid
_
Local Government Aid
6,853,446
7,067,521
214,075
3.1%
Utility In Lieu of Tax - RPU
6,000,000
6,843, 000
843,000
14.1 %
Utility In Lieu of Tax - Parking
230,490
238,865
8,375
3.6%
Utility In Lieu of Tax - Sewer
370,000
480,000
110,000
29.7%
Prior Year - CIP
1,600,000
1,600,000
-
0.0%
Prior Year - Other
922,240
808,740
(113,500)
-12.3%
All Other
11.331,194
11,424,692
93,498
0.8%
Subtotal - Non -Tax Revs
35.900,344
37,560,271
1,659,927
Total Operating Revenues
51,999,336
54,321,612 2,322,276
4.5%
2,322,276
'Expenditures
_
Employee Services
34.124,533
35,739,207
1,614,674
4.7%
Plus: Add'I Contrib. Pension
-
-100.0%
Plus:
City Share COPS Grant (8 officers)
173,785
228,644
54,859
31.6%
Employee Requests:
-
Subtotal Employee Services
34,298,318
35,967,851
1,669,533
4.9%
Other Current Expenses
17,214,980
17,814,032
599,052
3.5%
Capital Outlay
486,038
539,729
53,691
11.0%
Total Operating Expenses
51,999,336
54,321,612 F___2_,_32_2,_2_76_j
4.5%
Other Fund Expenditures:
Enterprise Funds
11,152.123
11,439,809
287,686
2.6%
Internal Service Funds
1,677,085
1,877,085
0
0.0%
Capital Improvement Funds
46,575,446
46,575,446
0
0.0%
Debt Service Funds
1,329,800
2,193,5D0
863,700
64.9%
Total Budget _.
112,933,790
116,407,452
3,473,662
3.1%
•
01 prelimmin.xis 8/30100
F
2000 Operating Budget
# 2 - Preliminary Levy - wlemployee reqs.
r1fDP1
Property Tax Levy
17,600,000
18,902,746
1,302,746
7.4%
Less: Levy to CIP
(1,346,582)
(1,386,979)
(40,397)
3.0%
Add'I CIP Levy -Streets
Less: Levy to Sewer Ent.
(154,426)
(154,426)
-
0.0%
Net Property Tax For Operating:
16,098,992
17,361,341
1.262,349
7.8%
Hotel/Motel Tax
1,900,000
1,900,000
-
0.0%
Building Permits
1,400,000
1,618,500
218,500
15.6%
Cable Franchise
520,000
800,000
280,000
53.8%
Fines
363,000
408,000
45,000
12.4%
Unfunded Pension Aid (estimate)
40,000
-
(40,000)
-100.0%
HACA
4,369.974
41370,953
979
0.0%
Local Performance Aid
_
Local Government Aid
6,853,446
7,067,521
214,075
3.1%
Utility In Lieu of Tax - RPU
6,000,000
6,843,000
843,000
14.1 %
Utility In Lieu of Tax - Parking
230,490
238,865
6,375
3.6%
Utility In Lieu of Tax - Sewer
370,000
480,000
110,000
29.7%
Prior Year -CIP
1,600,000
1,600,000
-
0.0%
Prior Year - Other
922,240
808.740
(113.500)
-12.3%
All Other
11,331,194
11,424,692
93,498
0.8%
Subtotal - Non -Tax Revs
35,900,344
37,560,271
1,659,927
Total Operating Revenues
51,999,336
54,921,612 2,922,276
5.6%
2,922.276
Expenditures
_
Employee Services
34,124,533
35,739,207
1,614,674
4.7%
Plus: Add1 Contrib. Pension
-
-100.0%
Plus:
City Share COPS Grant (8 officers)
173,785
226,644
54,859
31.6%
Employee Requests:
_
13.5 X 45,000
600,000
600,000
Subtotal Employee Services
34.298,318
36,567,851
2,269,533
6.6%
Other Current Expenses
Capital Outlay
Total Operating Expenses
17,214,980
486,038
51,999,336
17,814,032
539,729
54,921,612
599,052
53,691
2,922,276
3.5%
11.0%
5.6%
Other Fund Expenditures:
Enterprise Funds
11,152.123
11,439,809
287,586
2.6%
Internal Service Funds
1,877,085
1,877,085
0
0.0%
Capital Improvement Funds
46,575,446
46,575,446
0
0.0%
Debt Service Funds
1,329,800
2,193,500
863,700
64.9%
Total Budget
112,933,790
117,007,452
4,073,662
3.6%
01 prelimmid.xls Mpf00
18
2000 Operating Budget Scenarios
# 3 - Prellminary Levy - w/employee reqs.
Max
2000
2000
Amount
Percent
Govermental Only
Budget
"What IT'
Change
Change
Revenues
Property Tax Levy
17,600,000
19,185,773
1,585,773
9,0%
Less: Levy to CIP
(1,346,582)
(1,386,979)
(40,397)
3.0%
Add'I CIP Levy -Streets
Less: Levy to Sewer Ent
(154,426)
(154,426)
-
0.0%
Net Property Tax For Operating:
16,098,992
17,644,368
1,545,376
9.6%
HoteVMatel Tax
1,900,000
1,900,000
-
0.0%
Building Permits
1,400,000
1,618.500
218,500
15.6%
Cable Franchise
520,000
800,000
280,000
53.8%
Fines
363,000
408,000
45,000
12.4%
Unfunded Pension Aid (estimate)
40,000
-
(40,000)
-100.0%
HACA
4,369,974
4,370,953
979
0.0%
Local Performance Aid
_
Local Government Aid
6,853,446
7,067,521
214,075
3.1%
Utility In Lieu of Tax - RPU
6,000,000
6,843,000
843.000
14.1 %
Utility In Lieu of Tax - Parking
230,490
238,865
8,375
3.6%
Utility In Lieu of Tax - Sewer
370.000
480,000
110,000
29.7%
Prior Year -CIP
1,600,000
1.600,000
-
0.0%
Prior Year - Other
922,240
808,740
(113,500)
-12.3%
All Other
11,331,194
11,424,692
93,498
0.8%
Subtotal - Nan -Tax Revs
35,900,344
37,560,271
1,659,927
Total Operating Revenues
51,999,336
55,204,639 3,205,303
6.2%
3,205,303
Expenditures
-
Employee Services
34,124,533
35,739,207
1,614,674
4.7%
Plus: Add'I Contrib. Pension
-
-100.0%
Plus:
City Share COPS Grant (8 officers)
173,785
228,644
54,859
31.6%
Employee Requests:
_
Actual Requests less enterprise
883,027
883,027
Subtotal Employee Services
34,298,318
36,850,878
2,552,560
7.4%
Other Current Expenses
17,214.980
17,814,032
599,052
3.5%
Capital Outlay
486,038
539,729
53,691
11.0%
Total Operating Expenses
51,999,336
55,204,639
3-,2-05-,-3-03-1
6.2%
Other Fund Expenditures:
Enterprise Funds
11,152,123
11,439,809
287,686
2.6%
Internal Service Funds
1.877,085
1,877,085
0
0.0%
Capital Improvement Funds
46,575,446
46,575,446
0
0.0%
Debt Service Funds
1,329,800
2,193,500
863,700
64.9%
Total Budget
112,933,790
117 290 479
4,356,689
3.9%
01 prelimmax3.xis 8/30/00
�9
• Percent Increase
Amount From Prior Year Total
Pay 2000 Est. Market Valuation $ 3,484,350,300
Plus:
New Construction $ 161,540,600 4.6%
Increase in Mkt Value (Inflation) $ 389,852,800 11.2%
Pay 2001 Est. Market Valuation $ 4,035,743,700 15.8%
6Z) Total Property Tax Trends
By Parcel Type and Valuation
Through Payable 2000
RESIDENTIAL
Estimated Total
Market Property
Parcel 1 - $59,100 Value Tax
2000
59,100
692
1999
54,500
686
1998
52,700
710
1997
52,700
680
1996
52,700
672
1995
52,700
682
1994
52,700
680
1993
50,200
630
1992
50,200
608
1991
46,600
548
1990
46,600
510
10-Year Increase ($)
$12,500
$182
10-Year Increase (%)
26.8%
35.7%
Avg of Annual Increases (%)
2.5%
3.2%
10-Year Compounded Growth
Rate
2.4%
3.1%
Estimated Total
Market Property
Parcel 2- $87,900 Value Tax
2000
87,900
1,112
1999
81,000
1,068
1998
79,500
1,118
1997
77,300
1,064
1996
77,300
1,054
1995
77,300
1,070
1994
77,300
1,066
1993
73,700
946
1992
73,700
914
1991
67,900
798
1990
67,900
744
10-Year Increase ($)
$20,000
$368
10-Year Increase (%)
29.5%
49.5%
Avg of Annual Increases (%)
2.7%
4.3%
10-Year Compounded Growth Rate
2.6%
4.1%
•
1 of 6
Total Property Tax Trends
By Parcel Type and Valuation
Through Payable 2000
• RESIDENTIAL (continued)
Estimated Total
Market Property
Parcel 3 - $108,800 Value Tax
2000
108,800
1,512
1999
103,100
1,520
1998
100,400
1,614
1997
100,400
1,660
1996
100,400
1,642
1995
100,400
1,668
1994
100,400
1,660
1993
96,500
1,518
1992
96,500
1,466
1991
89,400
1.302
1990
89,400
1,214
10-Yearincrease($)
$19,400
$298
10-Yearincrease(%)
21.7%
24.5%
Avg of Annual Increases (%)
2.0%
2.4%
10-Year Compounded Growth
Rate
2.0%
2.2%
Estimated Total
Market Property
Parcel 4 - $223,000 Value Tax
2000
223,000
4,224
1999
210,300
4,160
1998
204,300
4,270
1997
204,300
4,338
1996
204,300
4,292
1995
204,300
4,358
1994
218,100
4,696
1993
207,900
4,310
1992
207,900
4,730
1991
226,000
5,874
1990
219,800
5,386
10-Yearincrease ($J
$3,200
($1,162)
10-Year Increase (%)
1.5%
-21.6%
Avg of Annual Increases (%)
0.2%
-2.1%
10-Year Compounded Growth Rate
0.1%
-2.4%
2of6
Total Property Tax Trends
By Parcel Type and Valuation
Through Payable 2000
RENTAL PROPERTY
Estimated Total
Market Property
Parcel 1 - $58,000 Value Tax
2000
58,000
1,376
1999
53,500
1,324
1998
52,000
1,534
1997
52.000
1,542
1996
52,000
1,526
1995
52,000
1.548
1994
52,000
1,542
1993
52,000
1,552
1992
49,500
1,680
1991
46,900
1,652
1990
46,900
1,542
10-Year Increase ($)
$11,100
($166)
10-Year Increase (%)
23.7%
-10 8%
Avg of Annual Increases (%)
2.2%
-1.0%
10-Year Compounded Growth
Rate
2.1%
-1.1%
Estimated Total
Market Property
Parcel 2 - $125,800 Value Tax
2000
125,800
4,284
1999
114,400
4,088
1998
114,400
4,600
1997
114,400
5,014
1996
114,400
4,960
1996
114,400
5,036
1994
104,000
4,560
1993
104,000
4,434
1992
104,000
4,410
1991
103,100
4,360
1990
94,600
3,732
10-Year Increase ($)
$31,200
$552
10-Year Increase (%)
33.0%
14.8%
Avg of Annual Increases (%)
3.0%
1.7%
10-Year Compounded Growth Rate
2.9%
1.4%
•
3 of 6
LJ
Total Property Tax Trends
By Parcel Type and Valuation
Through Payable 2000
RENTAL PROPERTY (continued)
Estimated Total
Market Property
Parcel 3 - $857,200 Value Tax
2000
857,200
29,190
1999
779,200
27,846
1998
779,200
31,332
1997
779,200
34,150
1996
779,200
33,786
1995
779,200
34,304
1994
779,200
34,160
1993
779,200
33,216
1992
779,200
33,044
1991
779,200
32,950
1990
779,200
30,740
10-Yearincrease ($)
$78.000
($1,550)
10-Year Increase (%)
10.0%
-5.0%
Avg of Annual Increases (%)
1.0%
-0.4%
10-Year Compounded Growth Rate
1.0%
-0.5%
Estimated Total
Market Property
Parcel 4 - $3,018,200 Value Tax
2000
3,018,200
102,778
1999
2,743,800
98,054
1998
2,743,800
110,328
1997
2,743,800
120,252
1996
2,743,800
118,966
1995
2,743,800
120,790
1994
2,743,800
120,288
1993
2,743,800
116,966
1992
2,743,800
116,360
1991
2,723,600
115,174
1990
2,494,400
98,406
10-YearIncrease ($)
$523,800
$4,372
10-YearIncrease (%)
21.0%
4.4%
Avg of Annual Increases (%)
2.0%
0.7%
10-Year Compounded Growth Rate
1.9%
0.4%
4 of 6
Total Property Tax Trends
�11 By Parcel Type and Valuation
Through Payable 2000
COMMERCIAL / INDUSTRIAL
Estimated Total
Market Property
Parcel 1 - $37,300 Value Tax
2000
37,300
1,270
1999
33,900
1,188
1998
33,900
1,272
1997
33,900
2,010
1996
29,300
1,720
1995
29,300
1,746
1994
29,300
1,738
1993
29,300
1,726
1992
27,900
1,606
1991
27,900
1,622
1990
27,900
1,548
10-Year Increase ($)
$9,400
($278)
10-Year Increase (%)
33.7%
-18.0%
Avg of Annual Increases (%)
3.1%
-0.9%
10-Year Compounded Growth Rate
2.9%
-1.9%
Estimated Total
Market Property
Parcel 2 - $189,600 Value Tax
2000
189,600
7,000
1999
172,300
6,362
1998
172,300
6,856
1997
172,300
8,154
1996
149,200
6,712
1995
149,200
6,814
1994
149,200
6,786
1993
149,200
6,660
1992
142,100
6,180
1991
142,100
6,206
1990
142,100
5,950
10-Year Increase ($)
$47,500
$1,050
10-Year Increase (%)
33.4%
17.6%
Avg of Annual Increases (%)
3.1%
2.1%
10-Year Compounded Growth Rate
2.9%
1.6%
•
5 of 6
•
Total Property Tax Trends t
By Parcel Type and Valuation
Through Payable 2000
COMMERCIAL / INDUSTRIAL (continued)
Estimated Total
Market Property
Parcel - $322,600 Value Tax
2000
322,600
15,422
1999
293,300
14,514
1998
293,300
16,108
1997
293,300
17,392
1996
253,900
14,894
1995
253,900
15,122
1994
253,900
15,060
1993
253,900
14,962
1992
241,800
13,918
1991
241,800
14,060
1990
241,800
13,408
10-Year Increase {$)
$80,800
$2,014
10-Year Increase (%)
33.4%
15.0%
Avg of Annual Increases (%)
3.1%
1.7%
10-Year Compounded Growth Rate
2.9%
1.4%
Estimated Total
Market Property
Parcel 3 - $1,464,900 Value Tax
2000
1,464,900
67,974
1999
1,331,700
63,734
1998
1,331,700
70,526
1997
1,331,700
78,964
1996
1,207,800
70,852
1995
1,207,800
71,938
1994
1,207,800
71,638
1993
1,207,800
71,176
1992
1,150,300
66,204
1991
1,150,300
66,884
1990
1,050,300
58,240
10-Year Increase ($)
$414,600
$9,734
10-Year Increase (%)
39.5%
16.7%
Avg of Annual Increases (%)
3.5%
1.9°%
10-Year Compounded Growth Rate
3.4%
1.6%
6of6
ERA
United States
ews Department `
Nof Labor
Bureau of Labor Statistics Washington, D.C. 20212
FOR TECHNICAL INFORMATION:
Patrick C. Jackman (202) 691-7000
CPI QUICKLINE: (202) 691-6994
FOR CURRENT AND HISTORICAL
INFORMATION: (202) 691-5200
MEDIA CONTACT: (202) 691-5902
INTERNET ADDRESS: http://stats.bis.govlcpihome.htm
USDL-00-234
TRANSMISSION OF
MATERIAL IN THIS
RELEASE IS EMBARGOED
UNTIL 8:30 A.M. (EDT)
Wednesday, August 16, 2000
CONSUMER PRICE INDEX: JULY 2000
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in July, before
seasonal adjustment, to a level of 172.6 (1982-84=100), the Bureau of Labor Statistics of the U.S. Department
of Labor reported today. For the 12-month period ended in July, the CPI-U increased 3 5 percent
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) rose 0.1 percent in
July, prior to seasonal adjustment. The July level of 169.3 was 3.7 percent higher than the index in July 1999.
CPI for All Urban Consumers (CPI-U)
On a seasonally adjusted basis, the CPI-U rose 0.2 percent in July after increasing 0.6 percent in June.
The energy index, which advanced 5.6 percent in June, rose 0.1 percent in July. A 2.0 percent increase in the
index for energy services was largely offset by 1.6 percent decline in the index for petroleum -based energy.
The food index advanced 0.5 percent in July, following a 0.1 percent increase in June. The index for food at
home rose 0.7 percent, reflecting increases of 1.0 percent each in the indexes for fruits and vegetables, for
cereals and bakery products, and for nonalcoholic beverages. Excluding food and energy, the CPI-U rose 0.2
percent in July, the same as in each of the previous three months.
Table A. Percent changes in CPI for All Urban Consumers (CPI-U)
Seasonally
adjusted
Un-
Changes
from preceding
month
Compound
annual rate
3-mos. ended
Jul '00
3.6
4.6
4.6
-7.2
4.5
4.2
3.6
Expenditure
Category
All Items
Food and beverages
Housing
Apparel
Transportation
Medical care
Recreation
Education and
adjusted
12-mos.
ended
Jul '00
3.5
2.7
3.5
-2.2
7.1
4.1
1.5
2000
Jan. Feb. Mar. A r. May June Jul
.2 .5 .7 .0 .1 .6 .2
.0 .4 .1 .1 .5 .1 .5
.3 .5 .4 .1 .2 .5 .4
-1.1 .2 .3 -.5 -.2 -.6 -1.0
.1 1.3 2.5 -.7 -.5 1.8 -.3
.3 .4 .5 .3 .3 .4 .3
.2 .0 .4 .0 .3 .3 .3
Communication
Other goods and
.5
-.5
.0
.0
.1
1
.6
2.4
1.6
Services
Special Indexes
.6
.8
.5
1.4
-.6
-.2
1.0
.6
5.4
Energy
Food
All Items less
1.0
-.1
4.6
.4
4.9
l
-1.9
1
-1.9
.5
5.6
.1
.1
.5
15.6
4.6
19.3
2.6
Food and energy
.2
.2
.4
.2
.2
.2
.2
2.2
2.4
See page 4 for a note on the use of hedonic models to adjust prices of selected products in the CPI for changes
in quality.
Bureau of Labor Statistics Data
Bureau`d tabor SMIS-Vti& Datar
1 1
Data extracted on: August 31, 2000 (04:42 PM)
Consumer Price Index -All Urban Consumers
Series Catalog:
Series ID : CUUROOOOSAO
Not Seasonally Adjusted
Area: U.S. city average
Item: All items
Base Period: 1982-84=100
Data:
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Consumer Price Indexes Home Page
Data florae Page-
0 BLS Home Page
Page I of 2
0? /
http://146.142.4.24/cgi-bin/surveymost 8/31/00
REQUEST FOR COUNCIL ACTION
MEETING
DATE: 9/11/00
AGSECTION:
ORIGINATING DEPT:
ITEM NO.
WA
REPORTS AND RECOMMENDATIONS
CITY ADMINISTRATOR
F - a
ITEM DESCRIPTION: Findings of Fact and Conclusions of Law Relating to Whether Road
PREPARED BY:
Constructors is a Reliable or Responsible Bidder
G. NEUMANN
On September 6, 2000 the Mayor and Council held a public hearing to take testimony on whether Road
Constructors is a reliable and responsible bidder for an award of bids for the Wellner Drive street construction
project.
At the conclusion of the hearing, the Council instructed the City Attorney to prepare findings of fact and
conclusions of law and order that would state that Road Constructors would be determined to be a responsible
bidder, but which would establish a one year monitoring period on their performance due to concerns regarding
the lack of communication with property -owners affected by sewer back-ups on two previous projects
performed by Road Constructors.
COUNCIL ACTION REOUESTED:
The Council may adopt, modify, or revise the findings of fact, conclusions of law and order as needed.
COUNCIL ACTION: Motion by. Second by: to:
BEFORE THE COMMON COUNCIL
CITY OF ROCHESTER, MINNESOTA
In Re: Road Constructors, Inc.,
and Wellner Drive Street
Construction Project
Findings of Fact,
Conclusions of Law,
and Order
On September 6, 2000, the Common Council of the City of Rochester held a public
hearing, upon notice to the public, to consider whether Road Constructors, Inc., (hereinafter
"RCI") is a reliable and responsible bidder for purposes of the Wellner Drive Street Construction
Project from 3151 Street N.E., to Rocky Creek Drive N.E. (hereinafter "Project").
At the public hearing, numerous neighbors who lived in the area of 48h Street and 13'h
Avenue N.W., testified concerning a sewer backup which occurred on or about June 1, 2000.
RCI's legal representative and the legal representative for RCI's insurer (The Cincinnati
Companies) (hereinafter "Insurer') also appeared and testified about their clients' roles in the
sewer backup and the manner in which they responded to inquiries from the public and from city
officials. The Council considered the information provided at the September 6'" public hearing a
copy of which is attached, incorporated herein by reference and identified as Exhibit A. The
Council also considered that information they requested to be provided to the Council and
included in the Council's official record. That information is attached, incorporated herein by
reference and identified as Exhibit B. In all, the Council spent two hours listening to public
testimony and discussing the issues which were presented.
•
3(
• Based upon the evidence presented at the hearing, the Common Council of the City of
Rochester does hereby make the following findings of fact, conclusions of law, and order.
Ia1►19112Ce'l-MeIa 7s�11
1. At the August 21, 2000, city council meeting, the issued of awarding a public
contract for the construction of the Project came before the Common Council pursuant to the
state's and the city home rule charters competitive bidding requirements.
2. Section 12.06 of the Rochester Home Rule Charter states that public contracts
must be awarded "to the lowest reliable and responsible bidder."
3. RCI submitted the lowest bid for the Wellner Drive Project.
4. At the August 21, 2000, council meeting, several Rochester residents appeared
before the Council and stated that RCI was not a reliable and responsible bidder. They based
their contention on a sewer backup incident which occurred on or about June 1, 2000, in the
area of 48' Street and 13' Avenue N.W. The residents, who owned homes in this area which
were damaged by the sewage backup, alleged that RCI was responsible for the sewage backup
as a result of its work on an adjacent construction project. They stated that RCI failed to cover
manholes which allowed significant amounts of water to enter the sewer line which resulted in
the sewage backup. They contended that RCI and its Insurer failed to promptly and responsibly
compensate them for the damages sustained. They also alleged that RCI refused to cooperate
or promptly communicate with those residents damaged by the sewer backup incident as well as
W
with city officials interested in obtaining additional information concerning the incident. •
5. Based on the concerns expressed at the August 21, 2000, council meeting, the
Council concluded that there should be an opportunity for all interested parties, including RCI
and its Insurer, to present information to the Council on the issue of whether RCI was a reliable
and responsible bidder. Accordingly, the Council tabled the award of a contract for the Project
and, instead, scheduled this public hearing. The issue before the Council was whether RCI was
entitled to the award of the public contract for the Project on the basis that it was the "lowest
reliable and responsible bidder."
6. Bob Bowron, 4215 13'" Avenue N.W., testified that he experienced a sewer backup
in his home on June 1, 2000. He called Rochester Public Utilities and they sent someone out to
inspect the home. The RPU representative investigated the matter. A week later, Mr. Bowron
received a letter from the City's insurers adjuster. The letter indicated that the City was not at
fault for the sewer backup. Instead, the letter indicated that RCI was responsible for the backup
as a result of its construction of a road on adjacent property. The letter suggested that he
contact RCI. RCI told Mr. Bowron that his name would be submitted to RCI's Insurer. After
several phone calls and a wait of six weeks, he received a two sentence letter from Insurer
which read: "Please be advised that we have completed our investigation of the above
referenced claim. Until you have established that the backup originated with our insured, we
must respectfully deny your claim for damages." Breta Rietz signed the letter on behalf of the
Insurer
33
• 7. Mr. Bowron stated that RCI never inquired of him as to their well being or the
condition of their home. He said they ignored him and acted like "cold people." He stated that
RCI and its Insurer "were just thumbing their noses at us" in hopes the delay would frustrate the
homeowners' desire to seek reimbursement for their damages. It was his opinion that RCI
should not be given any consideration for public contracts until they make amends to the people
who were affected by their negligence.
8. Mary Jo Bowron, 4214 13"' Avenue N.W., testified that responsible means "once
you have been chosen to do a job, you do the best job possible. ... When the same thing
[sewer backup] happens more than once, I call that irresponsible and negligent." She said if RCI
and its Insurer had acted responsibly, there would be no need for this hearing. She said if RCI
continues to act this way, they should find a more responsible insurer or the City should cease
doing business with this contractor. She stated that she made several attempts to contact Breta
Rietz at the Insurer. Ms. Rietz "laughed" at the City's insurance adjuster's letter which placed the
responsibility for the sewer backups on RCI and stated that it was simply one person's opinion.
She never received any response from RCI. She said, "we never heard from them."
9. Gloria Engle, 4412 13' Avenue N.W., testified that she incurred damages in
excess of $12,000 because of the sewer backup. She said RCI was responsible for two sewer
backups which occurred within a three week time period. She said she had pictures of the
damages caused by the sewer backup and wanted them introduced into the record.
10. In response to a question, Ms. Engle stated that she made many calls to RCI and
its Insurer. She repeatedly left messages with RCI and its Insurer, but they never responded to
34
her calls. On one occasion, she did call and managed to talk to Breta Rietz.
11. In response to a question, Ms. Engle said that the Insurer never informed her of
any on -site investigation conducted in order to respond to the claims.
12. Jim Lehman, 3600 48' Street N.W., testified that he lives next to RCI's building
site. He experienced $20,000 in damages because of the sewer backup incident on June 1"
and wanted to submit pictures into the record showing the damage sustained. He stated that on
Thursday, June 1', he, along with Bruce Timmerman and Linda Lehman, watched a bulldozer
push water down into an open manhole cover into a sewer line.
13. In response to a question, Mr. Lehman testified that he made about ten phone
calls to RCI concerning this incident. He stated that RCI responded "slowly, very slowly." He
also stated that RCI personnel were "very rude, very cold." He stated he attempted to call Breta
at the Insurer on several occasions without success. He said no one from RCI or its Insurer
came out to inspect his house.
14. Allan Mirehouse, 3512 48" Street N.W., testified that he called RPU after the
sewer backup occurred on June 1s'. An employee of RPU told him that there were manholes left
uncovered. He said on June 151, he watched a bulldozer push water into a manhole. He said
some engineering company came on Friday, June 2nd and made the bulldozer stop pushing the
water into the drain. Instead, the engineering company representative caused the water to be
pumped into a nearby pond or dike. He called RCI about the sewer backup and the City's
insurance adjuster's statement that the sewer backup occurred because RCI left manholes
uncovered. The RCI person said, "Oh, is that the story they're telling you?" She said RCI would
3s
t6n contact with them. The next contact was a letter from RCI's Insurer denying responsibility
for the damages. He tried to contact Breta Reitz at the Insurer and left messages. Breta Reitz
never returned any of his phone calls. He said RCI has taken no responsibility for this incident
and is simply dragging their heels.
15. In response to a request from Council President Hunziker, Mr. Lehman and Mr.
Mirehouse said they would supply additional information to be introduced into the record about
the identity of the engineering company that visited the scene of the sewer backup. In response
to another request from Council President Hunziker, RPU General Manager Larry Koshire said
he would check RPU's records and provide additional information to be introduced into the
record concerning RPU personnel who responded to this incident.
16. In response to a question, Mr. Mirehouse said he saw one manhole cover ajar
from the opening and one manhole completely under water.
17. In response to a request from Council President Hunziker, Wade Dumond from
Yaggy Colby said he would provide information to be included in the record as to the identity of
the person who stopped the bulldozer from pushing water into the sewer line and, instead,
caused it to be pumped into a nearby pond.
18. Bob Forsyth, Heartman Insurance, testified that he handled RCI's need for
insurance coverage. He extended sympathies to the homeowners who experienced sewer
backup damages. He stated it was unfortunate that the homeowners did not carry sewer
backup coverage on their homeowners' policies. He said they received claims in late June and
referred them to the Insurer. He said Breta Reitz is the local claim representative for the Insurer.
3160
She normally returns calls within 24 hours. He said there should be no blame on RCI because •
of a dispute between the City and the Insurer as to what caused this incident. He stated that the
liability issues involved in this case include pump problems, vandalism, other areas of entry,
removal of manhole covers and acts of nature. Mr. Forsyth stated that for the City to suggest
that RCI is not reliable or responsible is in itself somewhat irresponsible. RCI have been
involved in the growth of this City for the past 44 years and has been a responsible contractor
during all of that time. The Insurer is rated A++ which is reserved for the top 2% of insurance
companies. He stated this is a disputed claim and should not be considered in discussing RCI's
reliability or responsibility. He said the City should let the legal system handle this claim.
19. In response to a question, Mr. Forsyth said they did receive the claim the third
week of June.
20. In response to a question, Mr. Forsyth disputed the allegation that phone calls to
the Insurer were never returned. He also said that it is not unusual for adjusters to not call
individual claimants.
21. In response to a question, Mr. Forsyth indicated that he received the City
Attorney's July 6, 2000, tender of defense letter and forwarded to the Insurer. The City Attorney,
in response to a question, indicated he had not received any response to the tender of defense
letter
22. In response to a question, Mr. Forsyth agreed that the City was named as an
additional insured on the insurance policy issued by the Insurer.
23. Ken Moen, attorney for RCI, testified that RCI complied with all contractual
3?
ASirements associated with the Project. They have obtained the required insurance and bond.
He stated that RCI tendered claims to its Insurer on June 8'", the Insurer has accepted the
tender and is processing the claims. As such, he indicated that RCI is out of the picture once its
Insurer assumes responsibility for the claims. He stated RCI has done all that is required by the
City's contract and, as such, is entitled to be awarded the contract for the Project.
24. Mr. Moen stated that RCI cannot simply go out, accept liability and write out
checks. He said there are disputes about potential liability in this matter. He said the Council
cannot act as judge and jury in this matter. The City contract requires only the appropriate bond
and insurance policy in place. The contract does not require RCI to assume absolute liability in
any liability claim. He said it is inappropriate for the City to decide the liability in this case when
the City's liability may be at stake in this case. Instead, the City should only be concerned with
RCI's obligation under the contract.
25. In response to a comment from Council President Hunziker that the Council was
not acting as judge and jury in determining liability in this case, but instead was only taking
testimony from citizens as to whether RCI is a reliable and responsible bidder for this particular
Project, Mr. Moen stated, "I don't know that it is appropriate, Mr. Chair."
26. Council President Hunziker stated, "all I am taking is evidence of people's reaction
to how they were treated by Road Constructors." He furthered stated that, "[y]ou say that this is
a well -respected, local firm that has been part of the community for 40 years. I would think that a
well -respected local firm that has been part of the community for 40 years would care enough
that they might at least show up and find out what happened. Granted, it's a lot easier to send a
letter and let somebody else worry about it. But a well -respected local firm, I would think, would •
like to at least make some point of meeting with people that are living with sewage in their
basement."
27. In response to the City Attorney's question whether the City's contract documents
should include a requirement that the contractor return phone calls to those citizens who call
about how they perform their work and respond to city officials requests to appear and indicate
what the facts are, Mr. Moen stated, "put it in the contract if that's what you want." He later
stated that the evidence shows that there were prompt responses and that claims were promptly
tendered to the insurance company.
28. Peter Sandberg, attorney for the Insurer, appeared and testified that RCI was
insured for third party liability with the Insurer. RCI has notified the Insurer of the claims by third
parties as has the City. Once those claims are tendered to the Insurer, neither RCI nor the City
controls the processing of the claims. The Insurer controls the defense and payment of these
claims. He noted that if there is some criticism about the returning of phone calls, it should be
addressed to the Insurer rather than RCI. He further stated that the Insurer will either accept or
deny the City's tender of the claims. He also stated there may be some legal conflict between
the City, RCI, the Insurer and the homeowners.
29. In response to a question, Mr. Sandberg acknowledged that the City did tender the
defense of these sewer backup claims to the Insurer. He indicated that the Insurer has not
formally responded to the City Attorney's July 6, 2000, tender of defense letter. He stated he did
not see the file until the second week of August. Currently, the matter remains under review, He
3q
Astated that a response to the City's tender should be made within the next 60 days.
30. In response to several questions, Mr. Sandberg stated that it is not unusual for an
insurance adjuster to not visit the accident site which prompted the filing of a third party claim for
damages.
31. The City Administrator stated that, in response to the Council's request, he talked
to Mr. Quick at RCI about appearing before the Council to discuss these sewage backup cases.
The Council made that request on July 5, 2000. The City Administrator spoke to Mr. Quick the
next day. Mr. Quick indicated that the matter had been turned over to his insurance company
and, therefore, he would decline the invitation to appear before the Council.
32. Mr. Moen indicated that his appearance before the City Council's August 28, 2000,
Committee of the Whole meeting was in response to the City Administrator's request to appear
before the Council. He further stated that he advised RCI to not make public statements
concerning this incident.
33. There was some discussion as to whether the Council made one or two requests
that RCI appear before the Council. Mr. Moen indicated that his August 28' appearance before
the Committee of the Whole was in response to Councilmember Senjem's August 21, 2000,
motion to approve the city -owner contract with Michael Younge Development, Inc., for
Lincolnshire North Fourth Subdivision subject to the condition that someone from RCI appear
and discuss the substantive issues involved in the sewage backup incident.
qC)
CONCLUSIONS OF LAW
1. This matter is properly before the Common Council pursuant to Section 12.06 of
the City of Rochester Home Rule Charter.
2. This matter is also properly before the Common Council pursuant to numerous
Minnesota court cases holding that cities enjoy reasonable discretion in determining the lowest
responsible bidder and that the lowest bid is not necessarily the lowest responsible bidder. 5�=
ea., Otter Tail Power Co. v. Village of Elbow Lake, 49 N.W.2d 197, 201 (Minn. 1951).
3. The Council concludes that it does not have the authority to determine the
negligence claims present in this case. A city council does not have the responsibility or
obligation to determine who is responsible for the June 1, 2000, sewage backup cases in the
area of 48t' Street and 13' Avenue N.W. Instead, these claims can only be resolved through
the legal system.
4. The Council concludes, however, that it does have the authority to inquire as to the
manner in which public work is performed by those who are awarded a public contract pursuant
to the state's and city's competitive bidding laws. These considerations make up, at least in part,
the phrase "the lowest reliable and responsible bidder' as used in Section 12.06 of the
Rochester Home Rule Charter. Those to whom public contracts are awarded in order to perform
public projects for the good and benefit of the general public are acting as agents for and on
behalf of the City of Rochester and must be held to the high standard demanded by the citizens
of Rochester. Any sub -standard method of operation or lack of good interpersonal skills reflects
•
ply on the City and the members of the Common Council. Any communication to the affected
property owners as to what happened, what is being done and what can be expected to occur in
the future, as limited in scope as it might be, is better than no communication at all.
5. Based upon the substantial amount of testimony received at the public hearing, the
Common Council concludes there is a basis for concern as to the manner in which RCI
responded to private citizens and city officials concerning the sewage backup incident occurring
on June 1, 2000, in the area of 48' Street and 13'" Avenue N.W. Private property owners and
city officials did not receive prompt and helpful information from RCI concerning the June 1s'
sewage backup incident.
6. Based upon the substantial amount of testimony received at the public hearing, the
Common Council determines that, although there is a basis for concern as to the manner in
which RCI handled communications with private property owners and the City in response to this
sewage backup, there is insufficient evidence showing RCI to be an unreliable and irresponsible
bidder. The testimony is unclear and equivocal as to RCI's demeanor and approach to the
affected property owners. The affected property owners claim that RCI and its insurer failed to
perform their public contract with the public's interest in mind when it ignored them and the
damages to their home, failed to return phone calls, failed to provide helpful information, failed to
physically appear and inspect the damage, and failed to meet or discuss the incident with the
City of Rochester Common Council. RCI claims that it satisfied those contractual obligations
imposed by the City, including obtaining the necessary bond and insurance coverage, and
tendering the affected property owners' claims to its insurer. RCI also claims that its response to
1(;
requests for a public discussion of this incident were tempered by the filing of the claims and •
legal counsel's advice to avoid public statements. RCI's stated that once it receives claims for
damages, the Insurer, rather than RCI, controls the handling, processing and resolution of the
claims. According to the Insurer, if there was a lack of communication problem with affected
property owners and the City, the problem rests with the Insurer rather than RCI.
7. Because of the Council's concern, the Council concludes that it will monitor, for a
time period of one year, the manner by which RCI performs public work pursuant to public
contracts awarded by the City of Rochester. The Council encourages RCI, and its Insurer, to
reexamine its method of dealing with the public and with City officials, and to determine ways to
improve communication skills. During the one year time period, the Council reserves the ability
to revisit the issue of RCI's reliability and responsibility to perform public work on a particular
public project should additional or new information be presented to the Council.
The Common Council of the City of Rochester, pursuant to Section 12.06 of the
Rochester Home Rule Charter, does determine that Road Constructors, Inc., is the to the lowest
reliable and responsible bidder for the Wellner Drive Street Project.
The Council further orders that, for a time period of one year, it will monitor the manner by
which RCI performs public work pursuant to public contracts awarded by the City of Rochester
and reserves the right to revisit this issue upon presentation of additional relevant information.
`f3
Dated at Rochester, Minnesota this day of September, 2000.
John Hunziker, President of the
Rochester City Council
Fof.zoneRespBldder RoadO1
REQUEST FOR COUNCIL ACTION
MEETING
DATE: 9/11/00
AGEU2A SECTION:
ORIGINATING DEPT:
ITEM NO.
REPORTS AND RECOMMENDATIONS
CITY ADMINISTRATOR
F'- 3
ITEM DESCRIPTION: CONTINGENCY FUNDING - 173RD AIRBORNE VICENZA,
PREPARED BY:
ITALY DELEGATION
G. NEUMANN
The Mayor has requested a Contingency Fund transfer of $2,500 to be utilized to partially fund a delegation to
the City of Vicenza, Italy. The 173 d Airborne Unit has been reactivated in Vicenza, Italy.
The VFW Post has committed $5,000 to the cost of the delegation and they are requesting that the City provide
$2,500 in funding.
The attached memo from the Mayor provides the information on this request.
COUNCIL ACTION REQUESTED:
Approval of a Contingency Fund transfer of $2,500 for the Vicenza, Italy 173`d Airborne delegation costs.
COUNCIL ACTION: Motion by: second by: to:
.pGXF3TER....IAA
-"`�°. Mayor Chuck Canfield had
a I ? > 111-aMYRICA Cirl
201 3ih Street SE Room 281
Ro< hexer. YIN 5590 t 3782
Phone (50o 295-8080 tag (5071287.7979
T[D • AUGU51 ' S • .
MEMORANDUM
TO: Members of Council
FROM: Mayor Chuck Canfield
DATE: September 11, 2000
RE: Formalizing 173d Airborne/Rochester Connection
Vicenza, Italy
I have been notified by Floyd Riester that the 173d Airborne Brigade, formerly located in
Vietnam, has been reactivated in Vicenza, Italy.
They are handling hot spots in southeastern Europe and are currently active in Kosovo. The
brigade was very pleased by the way they have been welcomed in Rochester these past five
years and have requested that the connection formerly led by the Rochester Jaycees be
reactivated to adopt the 173d as a Rochester sponsored unit. This would include participation
in the VFW Youth Patriot Awards each year and prizes for the youth would include a trip for a
young person and his parents to go to Vicenza, Italy.
To formalize the partnership between the City of Vicenza and the 173d Brigade and the City of
Rochester, a delegation from Rochester is being assembled by the local VFW Post, chaired by
Floyd Riester. The VFW Post has committed $5,000 to the expense of the delegation and they
ask that the City commit half that amount, $2,500. All members of the delegation are expected
to pay at least $350 of their airfare and all of their personal expenses while in Italy. I have
agreed to do so myself and would be interested to know If any members of the City Council
would like to be part of the delegation. There are already 12 volunteers for the delegation,
including me. We will leave on October 30 and return on November 8.
Please advise if this could be handled out of the Contingency Fund and also inform me if any of
you are interested in being a delegate.
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