City Council - Regular Meeting

we can get going. I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Okay, the first thing on the first thing after call meeting to order is to approve the regular agenda. Does anyone have any changes, questions, revisions to the agenda as presented? If not, I'll look for a motion to approve the agenda. So moved. Second. Okay, I got a motion by Maggie Bass, second by Rick Sayler. If there's no other questions or comments, all in favor say I. I. Any opposition? Okay, passes 5-0. Next on the agenda is a consent agenda. Does anyone have any questions in any items in the consent agenda? If not, I guess I'm looking for a motion to approve the consent agenda. So moved. Second. Second. I got a motion by Rick Sayler, second by Bruce Wolf. If there's no other questions or comments, all in favor say I. Any opposition? Okay, passes 5-0. Next, we have government agency updates. I see we're here the honorable Commissioner Teetz to kind of give us a update what's going on. He hasn't been here for a while, so I'm sure Do we need to sit back a little bit? You're going [clears throat] to give us a dissertation here or what? Your phone's in your refrigerator is not there.

[laughter]

Thank you all for allowing me to come in again. Appreciate it. So, we have a couple updates going on in the county. I don't know if you heard, but uh the rifle shotgun uh the commissioners voted on a 3-2 Oh, so I had it on. It wasn't. So, the commissioners voted on a 3-2 vote to allow uh the rifles to uh to partake uh using rifles in our county. So, with that uh we're joined with Scott County, I believe Dakota County, Waseca County, Blue Earth County, Nicollet County. I know they they probably made it the decision by now, but I don't uh I don't know the outcome what that was. I know they had a public uh uh public hearing hearing, thank you. And uh I don't know uh what they decided. I know Scott County opted not to do the public hearing. Therefore, if you don't have the public hearing, it automatically goes to what the state recommended. Um we're working or um Hey Dennis, quick question. Is that something I is evaluated every year or is it So, good question. So, yeah, we could change it back every year. I mean, now if we want to change it back to shotgun, we'll have to have a public hearing again. Um my stand on that is it's going to be pretty hard for me to go back to shotgun just because you're going to have people now trading in probably their shotgun for a rifle and then the next year tell them that oh, now you got to go back to shotgun.

[clears throat]

I uh I would I made the motion to keep it shotgun and I got a second. However, I was like I said, outvoted by the other three commissioners, so. Do you know if the DNR is going to evaluate that? DNR did not want We invited the DNR to come to our meetings and they wanted to stay totally clear of it. Uh the DNR would have a force enforced any ordinances that if we had to said we wanted to keep shotgun, they were on board enforcing that along with any peace officer uh town cop, county cop, state trooper. I mean, everybody would have had the the right to enforce it, but uh yeah, so. I tried, I guess. I I And like I said, I listened to my constituents in this area. I was overwhelmed with people wanting to keep it shotgun in the my district, which is District 1. I think uh I think the other commissioners probably did the same, you know.

[clears throat and cough] New Prague is more metro than, you know, Cleveland and that area over by Waterville, so. We'll see how it goes. Hopefully, knock on wood, we don't have uh any incidents other than deer getting shot. Um [clears throat] We're wrapping up our Vision 2025 uh 2050 uh comp plan. [snorts]

We're five This is kind of been been finalized. It's opened up for anybody on the public to go to our web page to give input before this goes to our board to finalize it. So, this will be open for I don't I I don't have a a date when we close it, but we're looking for public input on suggestions from the people in our county on things that we should do or shouldn't do or whatever. Um getting a lot of phone calls on First Avenue Southeast. Uh as you know, that's County Road 60, but it's your First Avenue. Um I don't know if I needed to defer to Mr. Rinda. Um it's my understanding that this is maybe something in your CIP or capital improvement plan for 2027. Is that any confirmation on that? Yeah, that's the plan. Uh it's my understanding then utilities will all be done uh with that. Uh partially. Um obviously, we're in the very beginning stages of saying that to the council besides the uh thoughts of First Avenue being done uh and do a turn back with the county if that's agreed upon, but um Oh, we won't we I don't think we'll object to that. Um yeah, but there is some utility work that needs to be done, street work. Um Yeah, that's what, you know, what I got to tell the constituents is, you know, people are like, put another layer over this. It's like, if we put another layer, we're going to be ripping it all up next year. So, right now, hopefully, everybody can understand that we'll try to bandage it as much as possible, but there are I drove it two days ago and yeah, it needs attention and our our highway department county engineer is aware of it. Excuse me, my allergies are kicking in. Hey Matt, just a quick question on that. Is this something like we did with uh on the Scott County side that

we fixed it up and they pay for it and to give it back to us? We have a meeting this week. I think it's this week. I'd have to look at my calendar. This week or next week next week. Uh me, Ken, Chris Knutson with SEH, and then the county. Um we haven't got down to the nitty-gritty of who's doing the project, who's engineering, who's designed it, how it's being paid for. We haven't even got into that stage yet. So, like I guess we're in the very early stages where um it's really hard to tell how that's going to work out. Yeah, I'm sure Dennis will pay for it.

Yeah, right. So, obviously, you're aware of that. So, it seems like from 8th Street to the south is where it's bad. I mean, everything from 8th Street north seems to be in good shape. Yeah, it's about 400 ft north of 8th Street was redone 20 years ago. And then everything south of that has not been touched in 25 to 30 years. So, that's what we concentrate or is that what you're looking at just doing that from 8th Street Um

south? That's what we'd be talking about being redone, but that's we're the city's not just going to take over a street that's also 20 plus years. In my uh That would not be my recommendation to the council. I would say we need We're not taking over a street that's 20 years old and say it's good enough. Okay. Plus just minding Ken's discussions we've had uh prior to even coming to the council. I think we're still weeks away from Sure. [clears throat] But technically it is a county road still to this day. County road 60 so Yeah. Which I was Wasn't that under your control? That's your in district. Yeah. Yeah, but I mean why isn't the county patching that up and [clears throat]

We we are we're bandaging it right now. Okay, you are so that's happening. All right. Well, I don't know if it's happening today, but they they've done it once and then just with the weather, the rain before we could get blacktop before that even open to get the blacktop, we had to wait for that. So But the cost is that this at the patching is that 100%? Yeah, we have a Okay, that's what I wanted that's what I was It's the county's. Yeah. Uh any questions? No. We have uh a county official meeting coming up um I think we're hosting in Le Sueur County at towards the end of the May which is falls on a We usually do those on a Wednesday so I think it's the last Wednesday so And where's that at? I believe the county Le Sueur I think I think we're at Courthouse in Courthouse. Okay. Thank you all. I appreciate again appreciate it. Well, thanks for the update. Thank you. Okay, next um on the agenda is the public forum. This is an opportunity for uh people to speak on any topic to address the uh council. Um the only name I have on the list right now is Brian Paulson. Brian, do you want to come forward, please? Uh Brian Paulson, 206 4th Street Southwest. Uh Mayor and members of the council, uh I'd like to discuss something that's later on the agenda so Um pardon anyone follow follow along if I uh talk about things, but it's it's for later in the agenda and I'll be referencing stuff. Um so I do support finishing the trail along the 6th Avenue Northwest, but I oppose the method being proposed. So I'm talking about the the TIF uh district. Uh why are we using this for the first time? Uh normally just like all the street improvement projects that you have done the last years off Main Street, construction is assessed directly on the property owners of the street. But why not here? What is special about this project that

you're choosing not to use the formal approved special assessment policy that policy that the city has? Normally the business owners would be assessed a special assessment and pay the increase in normal property taxes from the improvements. But under this TIF, the properties skip the special assessment entirely and only pay the normal tax increase on the new value. In a special assessment, the school district and the county uh would collect their share of the tax increase, but under the TIF, they'll get none of the increase over the next 9 years. It is also worth noting that the two lots currently paying zero taxes so there's three lots discussed. Um one is two lots that are getting sold to one company uh paying zero dollars in taxes to the school district and the county and the city owns them. Uh once officially sold, uh Aventis Investments will have a multi-million dollar building constructed on them. That's already planned construction that would otherwise send hundreds of thousands of dollars to our schools and the county over the next 9 years. With this TIF, the school district gets nothing from that growth that's already planned without a trail. The city is required by state law to make the case that this TIF is necessary with the private investment uh that the private investment Brick's additional building uh and the construction of the last two lots would not reasonably occur without it. That's a stretch. This memo itself says Brick's expansion quote would be construction additional buildings by its agreement. And that the two lots will build out after closing. Those projects are already planned and moving forward. With this TIF, the new source of money uh is not a new source of money. It's a redirect directive taxes that are all already already going to be paid. Yet under the TIF, once the buildings are assessed, the new taxes that they generate, roughly 100,000 to 150,000 per year, will be captured 100% by the city for 9 years. This includes the full share that would normally go to our school district and Scott County. The school district and the county get nothing from the growth on these parcels

for nearly a decade. Compare that to how New Prague has always handled infrastructure. The city's own special assessment policy says that trails and public improvements should be paid by the properties that directly benefit assessed by front footage at a 1.3 times the residential rate for industrial properties. That's exactly how every other business and property owner in the city has paid for roads, streets, and similar improvements historically. Those owners paid their special assessments on top of their normal taxes. At $380,000 cost, this trail was only about $146 per foot. The city applied the same 1.3 industrial rate to its own policy requires, they would collect roughly $494,000 in assessments. $114,000 surplus over the real cost of the project. The TIF gives the businesses in the TIF district, which I believe is just those two properties, a special break that no one else received. They only paid their normal taxes and with the rest of us, we get special assessments and our schools and county services subsidize the EDA. The memo even admits staff discussed levying the project a special assessment but they chose the TIF instead. The city uh that choice lets the city capture the extra dollars from other taxing entities and frees up EDA funds, but it violates the benefit principle that the city has followed for years. I respectfully ask that the council reject the TIF and instead follow its own special assessment policy and let the properties that directly benefit from the trail pay for it the same way every other property owner in New Prague has. Thank you. Thank you.

[clears throat] Anyone else like to speak at this time? Okay, if not, we'll go on uh item six. We have no public hearing scheduled for tonight. Uh number seven, uh there wasn't really anything really uh Matt in our packet. Uh is there a I know we have the uh Friday is it the opening of the bids for

The opening this Friday for the 2026 project and hopefully that uh goes well. Um oil prices are a big concern right now especially with the uh pavement project so we'll keep an eye on that and uh we'll have a recommendation at the May 18th meeting. Okay. What about uh the projects that you know I think it was a 2024 project that we've had a hard time uh Um so that's still scheduled for middle of May. I have not got an update, but like I said that's uh the bond company has been aware and that's usually when things start moving along a little faster. Uh 2022 project, uh you might have saw some work being done on that uh today. They're removing some curb and uh sidewalk that'll be Columbus Avenue North by the hospital. Um that should be completed this week and then the county is doing a project that started today by the high school. Uh if you heard that was kind of a mess up there this morning. I talked to Scott County a little bit and they're hopefully going to have a little bit better plan tomorrow to have that traffic get moving through uh the morning rush in the evening or the afternoon rush. So um So that's on County Road 15? Yeah, right in front of the public works waste treatment plant shop. Is that going all the way uh north then?

on two. Okay. I believe that's where it's stopping. Okay. So yeah, they got it all milled up today so um they're doing a mill and overlay? For the most part, yep. And then some seal coating they'll do afterwards and striping and that. Yep. Okay. And anything else? Nope, that's it. Okay, thank you. Next item eight, um we have this I think Ken, are you taking this or is Josh? Uh I will take it. Okay. short PowerPoint I'll run through for a summary from the planning commission meeting.

[clears throat]

Give it a minute to catch up there. There we go. Uh yeah, so we have an item from the planning commission meeting. Uh this would be a proposed re-guiding which would be amending the comprehensive plan and then rezoning of the west 750 ft of Outlot G which is the Outlot uh between Raven Stream Elementary and Trunk Highway 19 uh heading west out of town and they're looking to move uh that small portion of it from B2 Community Commercial to RM Medium Density Residential. Calvary Church of New Prague is the applicant. Um so as I noted, um that 750 ft is basically the western portion of the property that they own that totals about 13 uh a little over 13 uh acres uh for that site. They do not need all of that uh for their uh future church development and are looking at potentially selling that uh western portion uh to help them fund um the construction of the church at some future date. Um again in the comprehensive plan, we have the entire corridor along Trunk Highway 19 on the west uh side of town there guided B2 Community Commercial. We've had it that way uh since roughly late 2004 early 2005 with that iteration of the comp plan and that really initially predated uh the construction of the Raven Stream uh development including Raven Stream Elementary. And over the past, you know, 20 21 years uh that we've had that guided that way, we've not had anything built. We did have the um interest from Walmart uh back in 2008. Obviously that did not happen. So then the zoning was kind of trued up to basically about 500 ft north and south of of uh Trunk Highway 19 out there um as a guided use. So with the church, their entire property uh whether they are B2 community commercial or medium density residential, they are a conditional use in those districts. So, whether all of it or a portion of it's rezoned

to medium density residential, doesn't really matter for the church's use. They are conditional in in either one of these, whether it be the existing zoning or changing it all to RM, but staff and looking at this, wanting to keep as much commercial out there that we can, and hopefully getting some more residential out there will spur on you know, more residential users and traffic to that side of town to actually make commercial viable and keep that commercial around in just that node or the four corners of the roundabout at Trunk Highway 19 and 11th Avenue. Here's a map of that area. Everything in that kind of reddish almost looks more brown or orange on the map there. We have along that entire corridor as I was mentioning is guided that way. This property is fully within the city limits of New Prague, so it does currently have the zoning of B2 community commercial right now, but the box outlined in orange is what they're looking to to move into that medium density residential. Eric as you know, as I noted as I noted a lot of the property to southwest and that area is

[clears throat]

outside of city limits, not developed. We don't know how that will develop, but again we have other land in the area guided B2 community commercial. And anything to the north we've got zoned currently around Raven Stream as medium density residential. As you head further to the west, we do have single family residential zoning that for the land that would abut Nailor Avenue, which is currently mostly unimproved as you head north. Here's a couple of concept plans that they did submit along with the rezoning request. The top one shows a townhome or twin home type concept. This is not anything they're proposing right now, just to show what could fit in that area. Roughly 46 units of townhomes that would also likely need to be approved through a planning and development. So, between the platting and any planning and development that would take a couple of different public hearings at the planning commission and ultimately the council if that were to be something that would have be applied for by a developer in the future. And then concept plan number two on the bottom there shows single family, which is allowed through our medium density residential. I would tend to think developer wouldn't see that as attractive for single family homes. There you just can't fit many of them. This shows roughly 20. And typically multi-family such as townhomes are a good buffer between a higher traffic roadway and then obviously the institutional type uses being the church and then Raven Stream Elementary to the north there. So, that would seem to be a good transition between those different land uses in that area. We did have a public hearing at the planning commission meeting. We did not get any public comments other than from the applicants from Calvary Church who are here tonight should you have any questions for them. From staff perspective, public works, utilities, police, we did not have any

concerns or comments that were provided that would prevent this from moving forward. And again, just to summarize, staff believes the request is justifiable. It hasn't had any movement out there for commercial use in over 20 years. So, this would move just a small portion of that into a medium density residential, try to get the traffic count and population up a little bit in that area from what it is today and maybe support that future commercial to actually happen. So, next steps, as I noted the planning commission did recommend approval on a 4-0 vote. And tonight what we would be looking for would be to have the resolution approved to amend the comprehensive plan. And then following that, we would look tonight for an introduction of the ordinance that would introduce the rezoning ordinance for that 750 foot portion of that property. And then again, if you had a favorable finding on that tonight with the first reading, you would move that to May 18th for a final reading and adoption. So, with that I'll put the map up back on the overhead kind of showing the area in question. Can the um So, if I understood you correctly, there are there's no land to the west of this that's B2 commercial. No, we've we've we've got it guided there. We did talk actually at the planning commission, we addressed it in the staff report whether we should just take everything from that that orange box all the way west to the corner at Nailor there, which is currently outside city limits. Should we just reguide all of that as medium density residential?

guided at now? What's that?

What's it guided at now? B2 community commercial all the way out to Nailor. Oh, okay. That's why I was asking. So, it goes that way. So, we have it that way. So, this we thought about that and we thought we just take this middle portion of that. We'll just say the block between Nailor and 11th at this point for medium density. I don't know that there's going to be much long-term demand for commercial along Nailor or at that corner of Nailor and 19. We could include all of that, but we didn't go through the hearing to include it at this point. Something we could we could change at a different date. The other thing that obviously can see there's single family homes there on the corner right now. You know, Nailor's going to be a more major road. It does connect all the way north to County Road 2. So, maybe we want to keep a couple of nodes there and just have the multi-family in the middle. So, we did talk about that, but ultimately this is a request we have in front of us. We could always reguide that in the future. Obviously cannot be rezoned until it's annexed. So, there's plenty of time for that if we wanted to come back and and reguide that as well to medium density residential, but for right now that that is not what the planning commission is recommending. So, I I should know this, but I can't see that well anymore. But, is is there four homes in that corner or There's actually five homes total on that corner there. Okay. Obviously in the future that's going to be a hard corner and that would be an advantageous lot for commercial property. I think what would make it and I didn't mention this in staff report, it would be a lot easier to justify that as a more major commercial corner if the roadway to the south on the sewer county lined up with that.

Yeah. Yeah. Right now it doesn't. They're offset a little bit. Not that that couldn't change, but you do have another home on that southeast corner of that intersection as well. Go go figure. be a tough sell for this general traffic. That's the way our area developed. We can't chew down a cell for that yet. Yeah, well, he's still here. Yeah, at least our county didn't match up the road. [laughter]

Well, normally I think of highway commercial as an important designation because just for planning and development of cities, that's a transition. But, this is kind of unique in the way I look at it and I'm sure everyone else did too that it's so close to the school. Yeah. And I think it does make a good transition, but um normally on a high traffic street, you you don't necessarily want to have residential homes right next to it. Right. I mean, I didn't go to planning school, but you did. Isn't that kind of how it usually goes? Multi-family is is not unusual at all. Again, as I noted it would be a good transition uh specifically with the two institutional uses being the future church and the school as well. Um yeah, it's one of those uses that it's it's in my opinion a good transition between the two. I don't think single family would be a good fit. I don't think a developer would even look at it that way just cuz you couldn't get enough units in there to justify the the cost, but townhomes would be a good you got good good traffic for the density of townhomes and it seems to me that that would be a viable option there. So, again we're trying to get, you know, housing units in town and and we do have overall limited areas for medium density throughout the city right now with the exception of basically directly to the east of Raven Stream. We do have land zoned that way right now and uh those haven't developed that way, although the Latter-Day Saints Church does not have their land openly on the market. And then the other lot north of that that five acre lot we've looked at and we actually have that reguided for high density residential or an apartment. So, this seems to be a good transition towards the school, but so that's a motivation, but is is it also a

motivation because it's felt that this residential be more marketable than the B2 commercial? Yeah, from what we've heard from any commercial developer, you know, we have roughly we'll just say 10,000 cars a day on the east side of town. You're looking at under 5,000 cars a day on the west side of town currently. [clears throat]

There's just really not anything pushing people, you know, commuting wise to head that way. You've got you know, Belle Plaine that way. You can head to Henderson and 169, but you know, it's under half the volume hitting through that western corridor of 19. And we still have a lot of land out on the east side that is to be developed and can be developed and that's kind of where the the bulk of everything will need to be. I think we'll get neighborhood commercial on these quadrants, but nothing huge. You know, you could get a gas station. You might get a a small office building, but I don't see much more than that. [clears throat and cough]

I brought this. Are you done, Bruce? Yes, thank you. I had brought the question up during the planning commission meeting. With medium housing there though, um you can see Kennedy Street right there, which doesn't has been a pretty sleepy street since there's been no development there. And that's going to we thought if you added 40 42 or 46 more medium density houses in there that that could potentially make that a much busier road, and I'm not sure the residents are know are used to that. And then the other aspect was is even though they can go out towards the roundabout twice a day, we kind of discussed the fact that that's full of 30, 40 buses that go around to go pick up kids there, pick them back and then take them back out the most of them out that that direction right at rush hour. So, we're and if you get 46 more units in there, uh as opposed to single family houses, that's a lot more cars and whatnot coming in there, and it could that, you know, it'll it'll force it'll push traffic down Kennedy is what it'll ultimately do, which snakes around and then comes out on on 21 there. So,

Kennedy is this far left one? It's the far left one, yeah. Right there. So, what time do the children get out of the the school? I I don't know what the direct bus schedule, but yeah, it's the morning and afternoon. Yeah, so having a kid over there, I know they go into school at 9:00. And get out of school at like 3:45 over there. So, our traffic picks up usually around 4:00. [snorts] Yeah. And obviously there will not be any outlet to the highway. Not directly from this development, no.

I know I meant that one a lot that So, my question [clears throat] is if uh we that area that's guided outside city limits, is that something when we annex it, would that be the opportunity to change that kind of uh designation too? It definitely would be an opportunity. It could be done before that as well. I mean, if we if we see interest for residential here, you know, quickly or I was going to say relatively quickly, even that might kind of push the demand thought to change and and move that direction. Okay. Any other questions? So, I guess the first thing we probably do what, the resolution first and then the ordinance?

Correct. Okay. So, I guess I'll look for a motion on the resolution CC-26-05-04-01 amending the comprehensive plan. So moved. I would Okay. Motion by Shawn Ryan, second by Rick Seiler. There's no other questions, comments. All in favor say I. I. Any opposition? Okay, passes 5-0. Next is the first reading of ordinance number 361. I guess I'll make a motion to approve the first reading of ordinance 361. I'll second. Yeah, second by Maggie Bass. If there's no other questions or comments, everyone say I. Any opposition? Okay, passes 5-0. All right. Good. Thank you. Thank you. Thanks, guys. There's no ordinances for adoption, no resolutions. So, next general business, the first thing on the general business is consideration to purchase 1201 1st Street Northeast. And Josh, I am assuming you're taking this. Yes, I I'll take this one. So, um and I know that we as a council had a had a discussion about this already. So, this is kind of more for the public, I guess. So, I'll try not to be too long-winded. If anyone's interested in more details, there's a a lot of reading materials here for people. Um but I guess kind of just generally, so here a a few weeks ago, I guess more than a few weeks ago now, probably 3 weeks ago, um staff was made aware that a local building uh went on the market. Uh and initially was kind of a conversation of um just a hey, did you know that uh

this particular church building is going on the market? And someone had mentioned, well, um would it kind of work for a city hall? And uh much as we did here a few years ago when a building came on the market and we weren't really looking for a parks building at the time, we decided to just just have a quick look at it. Um and there were a few of us that did kind of go and walk the property. And as we were walking through the property, over at 1201 1st Street Northeast, it it just kind of seemed to make sense as, hey, we we could actually see this building as a city hall. And that that really, I think, comes from the fact that initially, while the building has been a church now for 15, 16 years or something like that, it was an office building before that and was designed as such. And so, uh we we ran some really quick numbers and tried to make see if we could make things work, um knowing that generally when a building goes on the market, they're not looking to sit on it forever. Um and at that point, we then uh reached out to you guys, and some of the city council members were able to walk the building all separately. Um so, that way there's no conversations or potential open meeting violations. Um and then kind of coming out of that, we kind of started digging down, well, this is going to if this could potentially happen, we've got to do some analysis real quick. Um so, coming out using the 2023 study as kind of a guide of what this um this particular structure needs, uh as well as what it could be, um and then as well as trying to put our brains together as to what you would look for in a city hall, um what kind of a new city hall would cost us, uh how we would design that, that sort of thing. We really kind of started trying to break down is is the 1201 1st Street property a legitimate thing in front of us or is it not? And I'll just running through my executive summary here real quick, um looking at this building, uh some of the struggles this building has, in addition

to the um $1.2 million estimated maintenance costs that we have on that, um are accessibility and layout. Um I know one thing that we've struggled with in the past and will continue to struggle with is kind of the the way the top topography is right here on this particular lot. We've got multiple floors that step down. And Josh, just to clarify, you're talking about the current city hall.

city hall, yes. The this city this city hall right here, yeah, sorry. Um multiple floors, and you can see it from the moment you walk in, we've got kind of five steps that you have to walk up if you come in the south entrance. Um so, that particular level's only accessible by going out and around if a person is not able to use the stairs. And in fact, as you continue to go through the building, you go into the police department that's got more steps, and it continues to step down actually a number of times all the way down into the parks building. So, um this particular site is just is just rough for that particular instance. [clears throat]

Um we also have multiple counter stops at this site, which as you move as you look at more and more city halls, they're trying to develop a one-stop-shop type experience where a person visits one counter, and that's it. And then quite frankly, the other big thing I think is just the energy costs um of this building. We have an older building, single-pane windows, multiple HVAC units, and it's it was designed 90 years ago, um and it certainly is not your most energy-efficient building. So, kind of looking at the other facility from some of those same things, some of the things it had going for it was that it is a single single-story with no steps throughout the public areas. There's a small basement, um but that's it's kind of a a storage type area. So, um steps are not really an issue. And it also, um when you start looking at energy efficiency, does have a geothermal unit within it that had its pumps all replaced in 2024. Um research I was able to find shows that energy use can be reduced by over 50%. And in fact, we are able to compare utility bills, um and our utility bills are significantly less than theirs on any given month, anywhere from $300 to $2,800 less than theirs. Now, obviously, the uses are going to be a little different, so

And Josh, can you clarify that again? The energy bills are less at what building?

Yes, sorry. The energy bills at the 1201 building on any given month are anywhere from $300 to $2,800 less over the last couple years. Thank you. Um so, obviously, like I said, the uses are a little bit different. Um in fact, they probably have more weekend use, less daytime use, but they are still open during the day. So, um just looking at that, they do have kind of an open floor plan concept that we'd have to utilize um and build into a little bit, um but kind of the bones of a centralized lobby and a council chambers are there, um along with an efficient use of office space. And I say that because they're really one hallway throughout the building kind of leads the whole thing instead of the break up of hallways. And then just all obviously, as you look at the building, um it kind of has the Czech architectural elements that uh the city uh was having a lot of buildings put in back when this building was built about 25 years ago. So, obviously, um as we play into this, the financial comparison is a big deal. Uh looking at it, uh the asking price was just a just a hair under 1.7 million. Um having really high high numbers uh run, uh and we I asked around. In fact, I did talk to um Wold Architects just on a high level what they thought um because I didn't really want to have to pay them for any sort of analysis at this point. They they figured anywhere from half a million to a million would build out more than what we would need. And I know even uh working out some of those internal renovations potentially would need to happen. We have staff members that could do some of those to bring that cost down even further. So, we'd be you know in total looking at probably somewhere between a 2.2 and a 2.7 million dollar um cost to get kind of get it running and off the ground. And when we compare that with the estimated cost of a new

city hall um today and in what would likely be a more likely time frame 10 to 15 years from now. Um just off of Wold's estimates when they did the facility study, they were thinking city hall may cost us anywhere from 6 million today up to 10 11 million here 10 15 years from now. So, um I think this is certainly a cost um the cost would be in its advantage at this point. Now, I know there are there are certainly things that if you build new that we would get that we wouldn't get out [snorts] of this building. The one nice thing about this building is there is space on the lot right now for expansions without having to tear anything down per se. There's space to the space to the east. There's space up to the northwest and that sort of thing. Uh going back into how exactly we would pay for this, we do currently have about um 1.8 million in available cash um to be able to make a full cash offer. This this comes from money that we have set aside um over the last 10 15 years uh knowing that we had potential city facility uh needs in the near future as well as city road repair facilities. Those are kind of the big ones. Um also in our audit will be uh presented here next week. Um we did have a very favorable year in terms of uh being able to keep expenses down in a couple departments including the planning department due to staff turnover. Um and then also uh build it we had unexpectedly high building permit activity. That actually increased our revenues a little bit more than normal. Then couple all that with just um high interest returns on uh CDs and whatnot that are continuing to um outpace where we project an annual uh revenue stream for. So, coming between those, we do actually have the ability to pay cash for this facility so we wouldn't have to borrow. And then if there were any costs above and beyond needed in terms of renovations, our sanitary sewer fund is

carrying a very healthy balance that is planned to be spent one day um on whether it's future maintenance or expansions, but at the ex this exact moment is not being used um in its totality. And so, we could very healthily afford um basically to pay ourselves a 4% interest rate from the sanitary sewer fund for up to a million dollars if need be. I don't know if we'd even need that much. Um and allow both our sanitary rate to receive a better interest rate than it would on the market for a CD as well as the city would receive likely an at or lower interest rate than what we would be if we had to go out and bond for this. So, I guess at this base that is that's kind of my high level look at this and I'm I'm sure you guys have questions. Um and I'm sure the the public has questions. I know um at this point our uh plan is not to make any formal approvals tonight. Um the plan would be to let this kind of marinate for a couple weeks people in the public. I know the mayor mentioned it this morning on the radio. Um but if people got questions, they can certainly reach out to us. I know one of the big looming questions will be well, what happens to historic city hall here as I'll call it um since it is an almost 90-year-old building. And I think that is certainly a question that we can flesh out. I don't know if it's entirely married to the discussion of purchasing that building. It in in my head, they are certainly two two different questions, but I know that's not everybody's opinion. Um but uh it would allow us to have a conversation as a community as to what we would want to do with this building knowing that uh there would still be those overhanging maintenance needs um going forward with that. So, I guess if if you guys have any questions right now, I would certainly welcome them. [clears throat] Uh one thing uh as as we kind of uh work through this whole process just uh for transparency's sake since we did have our close a close meeting about it, um

the city did make a 1.7 million dollar offer here uh a couple weeks ago and uh that was accepted uh tentatively on that. Obviously pending things such as an appraisal and an environmental review. Um so, uh the one thing that I guess I would just ask the council if if you are all right with Chuck and I going out and kind of working with Kennedy and Graven to um find uh someone to kind of do an environmental review which kind of looks at the grounds and the building just to make sure that they are in the condition that we believe they are in. That sort of thing. So, um we're kind of looking for your blessing I guess for for Chuck and I to put our heads together and call the list of names and see if we can get that work done as well for you. So, one of the questions I have about the inspection is that we have a building inspector. Would that potentially be a conflict of interest to have our own employee inspect that building? I don't know if it's conflict of interest. It's something we did talk about with Kennedy and Graven. Ken and I did since the building inspector falls under his purview. Um I think we have the staffing ability we have the ability to certainly look at it. I don't know obviously somebody who does environmental reviews or building reviews is going to have a higher level of expertise. Um that being said and it would certainly be cheaper. I think the idea would be you'd be going to a third party who may not for better or for worse, you're getting an outside look at the building from somebody who does it all the time and this is what they do. Um building inspectors certainly they read codes, make sure that the building is up to code um and

Typically new construction is what they're looking at. Yeah, yeah, yeah, new new construction.

condition of an old building? So, so so it's a little bit different review. If we had to do it in house, I think we we could. I think we would just have a little bit more robust analysis if we were to go outside. If that makes sense. Understandable. And and I had those same thoughts too of just having uh a a third party Yeah. take a look at things. So, I I just wanted to bring up the question in the event that we were able to use staff. Yeah. I I'm just a little confused by that a little bit because I seem like we're conflating two different things or maybe I'm just reading into it more. The environmental assessment which is environmental Yes.

and property inspection which I think which you were talking about there. Yeah, yeah, yeah. still having an environmental report. Yep. Yes.

so, yeah. A phase one A phase one was done in 2009. And so, yeah, we'd look at prob And that's what I was saying. I know even talking to Scott cuz he's worked with a number of cities now. He said some cities are foregoing it entirely. I don't know if we want to do that. Um but yeah, we'd be looking at having somebody come in hopefully to do the environmental or phase one. And then um even just talking to Scott today, he said one of the firms that uh he said he's worked with also will do that same level analysis inside the building and just the general condition of your building as well. So, as a property inspection inspection. Correct. Um I'm not that concerned with the property inspection part, but I would think that we have enough talent in house here to make that assessment as long as we do that. Yep. And actually we that we have someone look at the roof. Yeah.

Actually look at it not just from the ground. Ground, but get up there and look at it because it has been repaired. So, we do know that it has needed attention. But I I would think and my opinion is we wouldn't need an outside property inspector, but the environmental part should be a third party person. Okay. And and yeah, so yeah, we we can certainly do with it if that's the way the council wants to roll with it. Obviously bringing in a third party for both is going to be more expensive than bringing in a third party just for one. So, um I know that the appraisal um we do have that started or on the books at this point to get someone looking at that. And what was that? $2,000 is what that was? 2,000 is what they said they'd do it for. [clears throat]

Um so, yeah, just so we can get it affirmed of what exactly are we looking at with the property. It's the same thing that we did with the parks building, too. Seems a pretty reasonable appraisal. Yeah. That's what we thought as well. Is that a full-blown appraisal or just a limited appraisal? Ours is full-blown. Full-blown. Hm. What's the environmental review going to cost us? Uh I would guess a few thousand dollars is I mean just from talking to Scott and his experience, that's what he thought it would be. But that's where I was hoping that council would authorize Chuck and I to kind of contact a number of firms and see see what basically we can get for a best quote type situation. Well, I'd be fine with that if we have an understanding that it's not going to come in at $25,000.

I I think it came if it if it came in significantly high like 10 plus then then I think that we've got another conversation to have. So, um yeah. I I would hope it would not come in near that. Mhm. Yes. Oh, it shouldn't come anywhere near that.

Well, that's the yeah, that's what I mean. So, Well, I'm still a little confused on the building inspection and the environmental. So, what how do what is the exact What are they looking for in the environmental? Yeah, so the environmental, I think they're kind of looking at as far as I understand, like like just the layout of the site and kind of And I know Bruce has a little more experience with phase ones than I do. Um maybe looking at them. But even so far even so far into if we wanted to take soil borings on a couple of those spots that are potential expansions in the future. Just what kind of soil are we looking with if we do want to expand the building, that sort of thing. If it was Phase one probably wouldn't get into that level of detail. A phase one is just a the lowest level, the cursory kind of thing. But going into the history of the land, was there any hazardous waste generators or holders on the site? It's more with hazardous waste pollution control, looking at permits in the past and uh pollution control uh sightings violations, all that kind of thing. I would think it'd be pretty clean, but you just It's a protection against the citizens in the city. Yeah, the one from 2009 showed that until the building was built in 2001, it was a farm field. Right. And So Actually, there's probably more risk back then. Just knowing I grew up on a farm what farmers kept on their property. Oil cans and tires. Well, and if it's only a few thousand dollars, it's not worth our you know, doing this having a big long discussion about it. Um But I guess my point is is if we did the study in '09 and those type of things didn't come back. Wasn't to us though. It doesn't protect us. Oh, okay. It's made out to whoever did it and bought it. So, when we buy it, it we're engaged with them and we we have protection if there's something No no yeah, we do have the '09 study and I don't I don't know what the if it's as easy as just getting it updated. Like and maybe that even

becomes a cheaper cost if you're only looking back to '09. That I don't know. And that would be just kind of digging into contacting people. So I would not recommend buying any property without commercial property anyway. I want to put Property inspector would actually be a much more thicker book, much more detail. Door knob on room four doesn't work, you know, that [clears throat] kind of detail. And but I'm assuming we can we have this talent to do that kind of thing. So, I guess we're Any other questions I guess at this point? Like I said, I've got I've got quite a bit in here. Um once you get past page two of that [clears throat]

So Well, I think you should note too that we're not taking a building off of the tax rolls. Uh Correct. So, I know that that had been a conversation in the past. Um in this particular instance, because they are church, they don't currently pay property tax. And so Um It it yeah, we're not the the the the tax generation from the two lots would not change if if we were to purchase it. I have a few things if there's opening here. Um [clears throat]

The deferred maintenance, the 1.2 million dollars, I do think that's a liability that we have or or um an issue that needs to be considered as part of the transaction. It doesn't go away if we buy another building. Um and as I think through it, it's not going to go away unless we sell this building. Correct. So, that's about the or demolish it. I guess those are the two situations where the 1.2 million dollar um debate with uh deferred maintenance that we felt was very important uh would go away. So, I do think it has to be figured in here, especially since when part of the thinking uh through is that as the old study was is to try to look at what's the cost to renovating this space or or building a new one. And obviously, if you renovate this space um then the maintenance would be taken care of as part of that project. So um So, I do think it has to be considered somewhere along the line here because um if we move to a new facility um you still if you're going to use it, you still have a 1.2 million dollars put into it. And that I think was looked at from today to out to five years. I think the tech pointing or was it the roof was going to last another five years possibly something was going to happen, but the 1.2 million was anticipated to be needed in the next few years. So Um so, I do think that has to be I think it's very important at least in my mind that we as part of this transaction or thinking, we think about and commit to what we're going to do with this building because the 1.2 million dollars is real and should be factored into this decision in my mind. Um I was confused by the old uh report a

little bit because the deferred maintenance, I wasn't sure. And maybe you guys can clear up for me, is the renovation cost numbers in the old study did they include the 1.2 million dollars deferred maintenance if we were to renovate the 10,000 or 9,000 some odd square feet foot or would we have that 1.2 in addition to the renovation cost? I guess my understanding is that that was part of that cost. So, if if if we were to renovate it, it would have been um gut and rebuild from the inside. So, that would have included fixing up the outside as well. So, yeah, that that was my understanding of that is that 1.2 if we if we would renovate, the 1.2 was just part of that cuz if you're doing those major renovations take care of that outside stuff as well. Well, I think the numbers get closer then as far as what's adding the best value whether we renovate the space or or make this purchase and then um I guess renovate that space as well or we or adapt it to our needs. The the numbers become closer, but I think it's still financially probably more advantageous to to buy and adapt that building than to renovate. But the numbers do become closer if that 2 1.2 million's in the renovation uh number. Um But the other issue when we first started talking about this was 500,000 dollars of adapting that building to our needs. And what's changed from that to a million dollars?

So, so so I guess I would say nothing has changed. So, so the initial cost the the initial number when I asked him what what would this cost, he initially threw out 500 to a million. And then he said, "What are you looking to do?" And then so I said, "Well, this is probably generally what we'd have to look to do this building." The offices are kind of set up for the most part, but we would need to um certainly front desk type area um as well as whatever the like council chambers and then build this out. And I said the number I was looking at was closer to half a million. He goes, "I think you could certainly do that for half a million and even potentially lower if you were to uh use use your own employees for for some of the work like we have the ability to. So, I think that half a million to a million it is trying to be conservative without having somebody that knows exactly what building costs are, having picked out this and this and this to know what it is. So, it's it's me trying to I hate to come in at half a million and then it comes in at 600,000 due to for whatever reason because I'm not an architect. And and so it's me just trying to play that conservative conservative number. Hopefully we can get closer. In in my mind, if we're talking about a half a million dollars versus a million, the comparison between renovating this spot and doing it that way is pretty clear. Once you get higher higher, then then then it almost the then the numbers become closer and it then in my mind almost deserves that we do a little more study as far as what's updated renovation cost here, especially since you mentioned that the 1.2 is probably in the numbers that Wold had for renovation costs that I think were like $400 a square foot or something like that. Um But um So, I I I would like to I would like hopefully the council would agree that

I would ask you to itemize that 500 to million dollars. I know you listed the items, but actually itemize. So, we have a level of confidence that you've looked into what are the dollar numbers or what you're estimating. Um because we we don't want a racehorse getting away from us and all of a sudden it's a million five. And No, and that's fair. I mean, admittedly, I I this was my asking asking an architect who who has not put pen to the paper and was giving me his super high level. I I don't know how in-depth he's going to want to go if he's not getting necessarily paid for it. And I don't know and like I'm envisioning at some point maybe if we got into this, we would want to hire an architect to help us draw out those two rooms as need be, but I I can I can certainly go back to him with that question because I do not know what a long front desk is necessarily going to cost or what building out the bathrooms um next to that that were removed from the 2001 plans is going to cost. I I admittedly do not know the the cost of those per se and I was kind of going off what someone else was telling me. Right, fair enough. But people in this business have a good idea what a bathroom costs and can assign a number to it. I'm just trying to get a a higher level of confidence that we have good a a number instead of someone just saying, "Well, it's going to be half a million to a million. Yep. Because it does make a difference. I think. Um then I'm on the [clears throat] interesting come if we were to borrow, um that was reflected as that would be part of our ability to pay. If we're going to look at that and consider it, I would like a and hopefully the council would support me in asking that we just do an estimate. What is that based on that we

can afford to make that interest payment? Because we're going to be using up a lot of the funds with the purchase. And the interest rates are going to be lower going out the next year or two than they were the last year or two in the past. So, we're looking at a lower interest rate in earning and lower balances than we've had in the last year's budget as an example or the one before that is what I would have guessed. But just to come up with how do you how do you figure that out? What is our actual interest income going to be? What assumptions are you using? What interest rate and what balances on that? Um And then how do you see this affecting either adding risk or not both our future capital requirements in the next three year five years? I mean I know we have a big fire truck coming up and some of these big things coming out there things that we're not going to have as much cash on hand obviously. Yep. So, [clears throat] I I will say that the risk goes both ways. Obviously, the more cash you you spend, if you don't have cash on hand, obviously you're going to have a little more risk um for other things. That being said, I know we generally we have an equipment fund that we've been [clears throat and snorts] adding to that hopefully is helping us build towards this fire truck. Um I know in the past when we've had large purchases such as a fire truck, we've taken out an equipment certificates and bonded. Um I didn't know during our budget conversations here last year the council kind of discussed hey, how much cash is enough? How much cash is too much? Are we sitting on too much cash? Do we need to play this down? We'd much rather bond first things and stretch those payments out for the taxpayers who are using them versus the saving route. I know cities both go both directions on that end. Um the thing I would say with in this particular instance is we had cash set aside for

city facilities and or the repairs of current facilities and that is basically the cash that we are tapping into at this point for this facility. Um There are there are a couple other small sources of cash that'll potentially add to that as I as I discussed whether it's the 499 fund or um if the police station continues to be built in a way that we're using little to no contingency, we'll have we'll have funds coming back to us that we had pledged to that. So, while yes on the level of not carrying the same amount of cash, I think our risk is going up. Much of the cash that we are using was for capital projects and or city facilities. And so, we'd be using that cash as it was designated. The um If we were true to choose to borrow from our own fund, um and pay with interest income, obviously that would still affect the finances and potentially the levy if we were to go that route if we were needing more than half a million and and like a million and couldn't come up with it all. Uh even that borrowing would still affect a possible pressure on levy somewhere because using that money interest income is money that you you couldn't use that for something else. Yes. That is correct. Um I think I think this is a great opportunity um and to to really do the due diligence on it to it's got a lot of potential. But I do think we have to look at all that kind of issues with the levy as well because um I think when we first started talking about this, you know, I think you your approach to was that we don't want to do

anything that's going to increase the levy at least. I'm not sure if you said that uh Yeah, if if I didn't say it, I was certainly thinking it. Yeah. I probably read your mind maybe. That's maybe what it was. So, I would agree with that if we can do

I I guess I'll say this Bruce before we go too deep into that. Rob and I have run a lot of numbers in terms of what our interest income has been the last few years, what we project out to be the next three years because we are laddered that far out with our CDs. Um I know we've kind of talked with 4M like where we're looking at these things going. I don't have those hard numbers included in this narrative here and I can certainly pull those together for you guys to kind of see that analysis that we were running um down to obviously if you spend cash, that cash is not going to make interest. So, what kind of hits are we taking that we won't that we thought we might be getting otherwise. And so, I can certainly get you that stuff. Well, I just make this comment as tactfully as maybe I can. I I know Shawn brought up uh months ago or or whatever about padding. Uh we that's not really what we're I think the comment about padding the budget wasn't really appropriate, but in another sense, I think that what we've been maybe guilty of sometime is conservative forecasting. And that's all well and good, but I think once we do this and we're starting to use interest income to actually dedicate them a payment, our ability to have conservative forecasting might be less and less. And It'll be a little tighter going forward than Correct. So, so

in the past.

Yes, I mean so some of those conversations aren't obviously people have different thoughts. I and I've shared this in many times in the past. When it comes to things such as interest income which are in the government world I'll say volatile. They're not changing on us day-to-day because we do ladder out three years, they do change. Um I tend to not like to budget reoccurring expenses with what I'll call volatile or volatile or one-off revenues. And so, because that interest income will change, how fast it's going to change up, down, left, or right, I try to budget in a way that is not relying on that interest income to meet daily or yearly revenue needs. Instead, that interest income goes towards the projects that if they disappear, if that interest income disappears, then you're not necessarily um up a creek without a paddle. You now just can't do this capital project that you would have done had it been there. So, um in this year's budget, if the city council moves forward with this, you will likely see a much more accurate interest income reflected because you'll see that interest income actually being used as a payment offset the sanitary fund revenues or potential loan, whatever that turns out to be from sanitary. And then once that loan disappears, if that interest income falls off, we don't have reoccurring expenses that we are relying on. So, it it's not me trying to pad, it's me trying to not put a revenue that could potentially go away one day um or likely will go one day whenever that happens into some sort of thing where now suddenly the city's got to find another two three percent because that interest income is no longer there and we still have to pay the bills. Great. And that's what I I don't want to don't want to see that um because of the circumstances so we go

ahead with this and all and we might see suggestion or budget recommendation for a higher levy because we're going to be conservative and we no Mhm. Um [clears throat]

and in my own mind, I have my own kind of goals of where I think levy should be. And I I think a lot of people would not like to see any spiking happening. And I I think this is a uh an opportunity that we can hopefully manage through in a in a well way, but the a million dollar additional cost to um make it work for us operational. Yeah, I mean I can Hopefully that's not an accurate number, but Yeah, and and I hope like I said, the whole whole point of this and how this started is we have a potential here to meet a need at at a significantly reduced cost um that if we had to build this 10 years from now, would be significantly more than we potentially only have to spend here. And part of that is can we manage this in a way that sees little as a little budget impact as possible. And including down to hopefully zero budget impact if we figure out the cards in our hands. So, Bruce, you remember we did sign on with Who who do we who's doing the strategic planning? Uh we have Abdo working on our long-term plan.

that should all be put into

that. So, so in our strategic plan, we should see what you're asking for. Right. And um as we've talked about before, at least I hope that we would have been in a position to have that done before we did this. And it just so happened this opportunity came before that. So, because then we'd have a better idea where we're going. But now we're looking at doing something and there'll be value to that that work, but it'll be done after the fact. Kind of Mhm. But it also would be able to answer some of your questions. And I think, you know, Well, really guide us is not answering my questions so much as guide us as a group in which way we would want to go. Yeah. Um with it.

[snorts] Okay. Anyone else have any questions or comments? You don't need anything from us. I I guess I would just ask like, do I have the council's blessing to work with the mayor to Yes. line up someone for an environmental review? I say yes. Agree. Yeah, I'm fine. [clears throat]

Yes. Okay. I just want to be I guess more conversation about the thought about this 1.2 million deferred maintenance. Um if we still have the 1.2 million dollar expense that's laying out there, this project is really 2.2 to 2.7 plus 1.2. Um But that's if you do [clears throat] That's if you do the maintenance. Now, if this building sits idle till we make a decision, obviously, you're not going to be heating it, you know, you don't have to do a lot of the stuff because there's not affecting anyone. You know, you know what I'm saying? You mean just let it run down? Well, I mean, let's say, like you said, the roof well, in 5 years, well, we're not going to look into that because we might not own this building in 5 years. You know, so, you know, some of And again, I never I wasn't I don't have the old Yeah. deal cuz I wasn't around, but I'm just saying, you know, what that 1.2 million was. What is it? Is it Is there safety issues What's the windows, roof, Right. HVAC. HVAC.

Right. You know, my question is if Yeah. My question is is tuck pointing, 25% of that tuck pointing.

Right. You know, the question is if there's not there's not a safety hazard on certain tuck pointing, you're probably not going to do it because we're not going to be in this building. You know, a lot of the stuff you wouldn't do, you know, I mean, cuz I assume, you know, we'll probably have to do an analysis, you know, what are our options? What are we going to do with this building? You know, if we go forward with this and we move into the new city hall, what are we going to do with this building? Was there abatements that were going to be needed to be done here for asbestos, lead, or anything else? That would be something we'd have to bring in even when we got a quote to um demo the [clears throat] parks part of that down there. Um was it 100,000, Matt? Is that right? That's correct. Um but that but but but but that did not include any asbestos abatements. Like they they said you'd need to bring somebody in to look at this and determine whether we have

start tearing all this stuff apart, it's going to become friable and it needs to be abated.

I'm going to make the I'm going to make the off I'm going to guess that there's asbestos in a 90-year-old building. I I I I just stab at that. I think we determined the floor of the basement's asbestos, didn't we? I don't recall. We've never had it tested, but talking to people in that field, all the piping is wrapped with asbestos. Yep. Um the tile is wrapped with tar is asbestos just from the year it was installed. So, I mean, without being it tested, I feel very, very confident from talking to the experts that it is. Right. Right. Well, I think your points are well made, Chuck, but I you know, I've been here a few years now and we've we've heard the urgency and the dramatic need that we need to do the maintenance. And it's hard to listen to say, well, we can wait 5 years after we've been hearing for the last few years that it's imminent that we need to do these things.

And and and I think it Yeah, so I mean, I mentioned in my report, I think a lot of it comes down to what do we want to do with the building? If we plan on keeping the building, then yes, I do believe we should do the maintenance because the further it goes, the more expensive it is to get it back. Um in terms of how far down the line you're going for maintenance. But if we're looking at um transferring the build selling it or transferring the building to somebody else or if the the city uh comes together and says, you know what? Maybe just the maintenance costs don't make sense. Like, we don't want the build Whatever whatever that is comes out to be, like I think that'll help guide how quickly that maintenance gets done. Yeah, I think it's just all comes down to determination if this building is going to be occupied or not. And does it make sense to have it occupied and put in 1.2 million or not have it occupied and put in 1.2 million, which doesn't make any sense to me. I mean, if you're just going to let the building sit idle, um But even if we tear it down, you'd still have to do like abatements and stuff like that. Understandable. That's that's understandable. Yes. Yes. But, let's say we do transition into the new building and there's absolutely no need for this building, then it doesn't make sense to sink in that much money for windows and HVAC, etc.

And now I will say and I I do mention it in there. Um We have looked around. We are unable to find any grants for this building. A lot of that is predicated off the fact that it's used as a city hall. People just don't hand out grants for city halls. It's possible, and I don't know who it would be, if somebody came in here and wanted to revitalize the third party or another government entity or maybe even us if we had a plan to use this as a not a city hall, there's there's other grant funds out there for revitalization of buildings, whether for housing needs, that sort of thing. So, um And I yeah, I don't know what what what those would look like. We haven't really explored those cuz this building has always been a city hall for us. City hall condos. Well, yeah, I I [snorts] I I want to move the ball forward at least in that thinking that we are prepared to sell the building if that need be because it isn't as dramatic as a slam dunk to me if we're going to keep this building and put 1.2 million dollars into it. Mhm. If we're going to find a buyer that can do the work themselves, they can save money, da da da da da da, maybe we can sell it or do something, but to me, if we're going to if the decision we're going to keep it and put 1.2 million in it, I think we should do a little more thinking about that because I think the numbers are a little closer than because in either event, neither one of these are meeting the long-term space needs that were identified in the report. Correct. Even that other building is like short of this just straight square footage that they were they were mentioning in there. Um That being said, like I said, there is the ability for that building to expand on site. Like we I'd kind of identify that out. Um I don't know the exact square footage of that expansion. We've not measured out what that is, but that is certainly there. Um So, yes, you you are correct. I If if we were to build exactly brand new, we

might build slightly larger, slightly more in this direction, that sort of thing. So, this this is not the perfect puzzle piece fit by any means, but I feel it is a much, much better puzzle piece fit that if if estimates are right and it would cost us 10 million to build a new one in 2035, we're saving ourselves almost 7 million dollars just on that building. Yeah, I think the estimates they used in Wellstead were a little less than that. That was with the police station with it. When you say 20 million dollars. 10. [clears throat]

10. Oh, I said 10. Okay. Yeah, I think the estimates Cuz I think they were north north of 20 with a police station involved. I think it was like six to seven or eight. Yeah, for 15,000 square foot, I think it was like 6.7 million at $450 a square foot. I think that's a cheaper than building a police station, but 10,000 was closer to 4.5 million. I think either either one of these are less than building a brand new building. Oh, yeah. It's just that renovating and putting in a 1.2 in And and and yeah, it would likely be major renovations over here cuz I know they even talked about you'd attempt to get rid of all these half floors we have going down. I don't know how you do that, but that's what you hire someone else to figure that out. Okay. Should you be clear, we're going to have an appraisal before this week?

has already been ordered and we we were told it would be done before the 18th. Yes. That's that's what we were told. So, we'll we'll be able to see it before then. That's Yes. That's the plan. And That's what it said on the contract, I think. Even talking to Scott today, right before this meeting, he'd mentioned that he just went under contract with someone in Faribault for an environmental. They were turning it around in less than a week. So, um my hope is we can find someone to even get one of those turned around quickly for us. Yeah. Especially if we tell them that we that one was done in 2009. That you can't hurt. And they can have that report and say, okay, here's your starting point. Cuz if that was accepted at that time by obviously, whoever did the mortgage. Maybe you guys should reach out to that firm that did it. I mean, that We're not locked into Scott's guy, are we? No, I mean, well, so yeah, the way that was working is we were just trying to come up with a big list of people if we had to start calling. So, Scott was giving us a list. I think Ken came up with a list of names he knew. Um So, we can start trying to get some quotes. Okay. So, for an agreement, Josh and and I will kind of look into it and we'll go from there. And try to get all the pieces together by the 18th so we can uh go forward cuz I think potentially if I all the pieces fall into place they want to close June 5th. Correct. So. Okay. Thank you. Next we have the potential a TIF for public infrastructure. Uh yes. So, starting back here a few years ago is right after I started. I know the city started applying for grants through MnDOT to pay for the trail collection along 6th Avenue and Ken gets me on this constantly cuz I apparently even though I'm a city planner can't understand streets and avenues. It would be 6th Street not 6th Avenue. Um kind of there through the through through the industrial park about 2600 ft worth. So, thus far we've applied three times and we've still not been funded. Um

I think talking to Ken it sounds like they haven't appropriated funds yet, but if they do again we will Oh, we may likely try to apply again. Uh that being said in 2025 our application uh estimated about uh $380,000 worth of work for that trail. So, we were kind of speaking to uh our elders representatives about funding sources um and one of the things that came up knowing that the city in this instance or I should say the EDA city by extension is the developer and um would be required to put this in was a potential of using a TIF district to fund these um this particular. So, when cities put together a TIF district they have the ability to use that um to build out the infrastructure. In this case this would be part of the infrastructure for that site. Um now of I I should make a note just just off of Mr. Paulson's comment today um in ever since I've been here and I think going even back farther than that when we put sidewalks in we do not assess the cost of a sidewalk to any property owners. Um their their assessment does not change whether the sidewalk is present or not. Um we did that specifically because we only put a sidewalk on one side of the street and it would not be fair to the property owners on one side versus the other side. Um and so because the the sidewalk really is for a benefit of the whole community that is something on all of these streets that we've done that those sidewalks have been put in by the city not necessarily assessed back. So, along the same instance um when we'd be looking at doing that that is why we are not looking at necessarily assessing any of these property owners for this sidewalk. Um and being that we are kind of the developer here generally we would then be responsible for putting that uh sidewalk and or in this case a trail in. So, the reason why TIF came up is we do still have a couple properties out there

that are not fully developed. We have the two uh properties that actually just closed here last week. And then we have the Bricks Boatworks property which through the through the development agreement is planning to put at least three more structures on. I know in informal talks they've talked about potentially even more than that, but the agreement only calls for a few more. Um Uh and basically the way the TIF would work is that any future added value to the property would then be collected by the TIF to be used back towards future improvements. And so, when I say future improvements that basically means anything that is not issued with a building permit. So, if a building permit is if Bricks were to submit a building permit tomorrow for the rest of those buildings um we would not be able to capture any TIF value or added future value because that is no longer future value it becomes the value now. So, if so if the city were to put a TIF district over these two particular properties what would happen is they would just capture all the taxes that are produced by those and use those revenues then to put that trail in um instead of if we were to do it the other way uh we would only capture the city portion. So, TIF does allow us to capture the future value of these county and school district taxes. It does not necessarily take away any taxes that they're currently getting today. Um I shouldn't say necessarily it doesn't take away any taxes they're getting today. It's it's added value on future improvements. And so, we would be looking to use those added future values to help pay for this trail through here. Um At at and it's basically an economic development tool we have to build out the infrastructure and one that we'd be looking at going forward. And my thoughts are really all over the place right now and it looks like Shawn has a question. So, maybe I'll just go to his question and that'll help kind of zero me back in

on where I'm my brain's going. Well, I have a few questions. Um Number one um where is the trail going to? Uh the trail so I think it's it's on our park plan isn't it? But basically it goes along yeah. comp plan. It goes along the north side of 6th and then as um 6th continues to build out it'll continue to get built out. Yeah, but right now it's a trail to nowhere. That is like every single sidewalk we put anywhere. It's a trail to nowhere until it gets added to it.

a trail coming north from the west water tower Okay. that comes out to 6th Street. This would end and basically bring you back into the trail system into Finder Hill Park. Okay. At this point. But Josh is correct it will eventually continue all the way on 6th along that north side all the way over to Nailer Avenue. Okay.

Ultimately when that neighborhood builds out. And and if it's not taking funds the way you described it Josh from the school district and or the county um I I and I should say it's not taking existing funds. So, the county's tax dollars wouldn't go down at all. This would be future funds that would get paid to the county after the TIF district is over. Okay. Well, um then I'll go to your recommendation where your last sentence says it would also allow the EDA to use their funds for other targeted economic development projects. A I'd like to know what that is. Um what that list is. Um and then because they're already sitting on what is it I always say 600,000, but what's in that EDA fund? It's over a million maybe now. So, so with the sale of property today we're just uh just under a million. Just under a million. It's between there there's kind of split up between the industrial park fund um and then the just general EDA fund. But between the two yes it's just under a million for those two. Okay. So, that seems like a pretty substantial checkbook. I don't know what else we would you know um why we would need to use other money that's there. And really I still have a a big problem with the EDA off and not the overall mission of the EDA um but the way that an unelected board is spending tax dollars that we are either giving them on a yearly basis uh and or things like this for a TIF district and then they're coming up with their own projects that seems to benefit them, but maybe not doesn't necessarily benefit the taxpayer in a in a in a way that they want to their taxes to be used. Yeah, and and I guess I I'd respond to that in that the EDA um basically receives their powers both from you as a city council and from the state as to what an EDA is allowed to do whose

general mission. And they they vary a little bit from community to community, but generally the mission of an EDA is to try to increase the number of jobs in the community as well as just increase the general tax base of the community and help the community to grow. Um there are two city council members who sit on the EDA that that can certainly um they have a voice just like all of the others and in fact they probably have a slightly stronger voice with the EDA many times knowing that for a lot of things they do need the city council's blessing to move forward with. Um Many times not all, but I don't want to get too bogged down in there. But but I I I I would just say you asked for a list that is what the EDA is currently working through. Okay. They're exploring everything from expanding the industrial park um to potentially working with downtown businesses or lots to try to improve things in downtown. Um right now that that's just a conversation being had at the EDA as to kind of what's next. And my hope with using a TIF district to pay for this trail is it would allow them to be able to maximize their current dollars to be able to continue their mission cuz I know different people have different opinions. I think that the industrial park has generally been a success if you look at it in the fact that I think none of those businesses may be out there if we did not if the city I didn't say it was wasn't we if the city did not have those lots available. Um I don't think any of this is those businesses would have been there. And I guess I'll I'll point to the fact that there's been no developer that's come along to kind of expand on the back end. And so, but one of the powers that a city has when it does a industrial park expansion is we're not necessarily looking for a return on our investment on day one. Um in my opinion the return on investment for a city comes from the future tax dollars that would not have been created or the the future jobs that would not have been created had those lots not been

available for sale. And so, obviously how the EDA operates it's it's under the purview of the city. Um and if the city wants the EDA to go a different direction than it is it has that ability to. Um but this I guess this is just my recommendation of how to proceed. Sure. All right. So, and then I asked you before the meeting started if I could get a copy of what the total dollars will be over the 9 years from the TIF district that the city we don't have you said you'd look into that and get that number for us. Yeah, that yeah that that was yeah that was the number that I can certainly Okay. Cuz I'm sure the general public will want to know is it 1.3 million or is it 18 million? You know.

Yeah, no that's fair. Um and and I will say and I know that you and I talked about this. This is not approving anything tonight. That this for for a TIF district to go into place, there needs to be a public hearing public notice, that sort of thing. And so we'd working through Ehlers, I know they put together a really high level schedule that would potentially see a public hearing coming that first meeting in June, I think it was. If we decide that this is something we want to look into and that sort of thing. And all that analysis would come with it. I mean part of the TIF district is like one of our representatives likely Rebecca Kurtz would be here presenting all of that information as to what we expect to get out of it, what that payoff would be, how the uses of those funds could go, that sort of thing. So that yes, that is all part of that.

Okay, thank you. And then my next question is is why do we have to do a TIF district to build out a uh asphalt trail? Um I mean it seems like if it's 380,000 that should be maybe part of just a general fund or the an area that we should be able to prioritize within our budget meeting to say hey, we're going to be looking at this, we want to do this or bond for it perhaps or it should be in our overall plan. It could.

I'm just wondering if if if this if already we're in the situation to to and I'll just expound on Bruce's point a little bit cuz he used me as a reference which was true about this patty and I'm just wondering if this isn't trying to somehow make our we didn't have the 380,000 in our general fund or won't have it over a series of years because of the police station and now the the city hall and all these other things that really should be our job to prioritize those to a certain extent and if we can't get a payloader this year cuz it's $380,000, maybe this is we've decided that it's the trail. So I'm just wondering why it isn't in our general fund or in in another fund our park fund or wherever that we could be using that to to extend that trail and that we have to go to this and I'm sorry that it sounds a little pessimistic but I [clears throat] I that's why I question these things. I just I don't know why we wouldn't have that available. No and I now we have to do a TIF district. I think it if the city wanted to go the route of bonding the city I mean I would say to the city cuz the city if the EDA was going to borrow, they'd need the city's permission. If we wanted to go bonding, that is certainly a route we could go. You're paying interest costs at that point. Um If the city wanted to levy for it, that is certainly a route we could go. This this is just one option and um in my opinion, it is a very good option that I don't think the city has ever really utilized for itself at least as far as you know either to utilizing a TIF TIF district for itself to help make economic development improvements. And so um this in this instance, the state allows for cities, counties to establish these TIF TIF TIF districts

to help capture the tax revenue to pay for stuff over and above the normal tax revenue that they would normally collect without increasing the taxes on that particular property. They are just more funneled to one entity instead of split between three. Um and this is just one particular route that I think this is worth considering to build this trail out.

That's a really good point that you just made there because we have we're going to give a tax increment financing to two buildings that are already I've seen plans of them, the lots are sold, these buildings are going in, everything's approved. I have mock-ups of it. So now that it's it isn't new growth that we're we're it's like we're rewarding them We're not re to to build this They're not getting anything out of it though, Shawn.

No, I know they're the business isn't. It's us though but in fact, if we don't take this TIF money the school district and the county will get taxes on those buildings that are going to go up. So when we say that we're not taking money from them we really are because it isn't it isn't new growth that's that's that's going to happen six months from now or eight months from now because we create this district. That's the real idea behind it. Those buildings are already there, I've seen plans of them, I'm on the planning commission, they're going to go up and the school district's going to get the rewards for that for the next nine years if unless we do this TIF district and then we're going to take it, the city and they're going to lose it. So and the county will lose theirs but I will say I can't speak for the school district but I know my guess is that they would be generally supportive of a trail being put in there because I know there are as someone who did a lot of running the last couple summers, ran down 6th Street a lot. There's a lot of people that get down up and down that street without any sidewalks or trails. And so in the past, the school district has generally been supportive of building outside networks for just pedestrian travel knowing that people ride their bikes, whatnot up and down trails. That you are correct though, Shawn, in saying that by us capturing the taxes, there could be up to nine years or however long it would take to pay it off a number of years where the and I I don't even know what the tax value they would be receiving from it cuz I think they receive um less in property taxes than we generally do. But Ehlers will be able to tell us at the Ehlers will be able to tell us should be able to tell us with the evaluation of these buildings, these are the exact tax dollars we expect would have gone to the city, county and school that the city is able to capture and for a temporary time to help pay for this public infrastructure.

$380,000 that's the trail but there's all this there's this unknown extra money that's going to go to the EDA to fund other economic areas. And my point is is that it'll be interesting to know once we get that number when we get that number from Ehlers, then we can let really it should be the school board. Let's see how supportive they are for a trail. Do they want 1.2 million to put in their coffers and do something else or do they want to do that? What number did you get? I'm just throwing out a number. I we don't know what the number is. I wish we would have had that. So that's to make the trail. That's to make the trail. So yeah, I just threw out the number cuz I didn't know a number but it could have been

at the number. It says 380, that's just for the work of the trail. But we're going to collect money for nine years and the EDA is going to get the rest of that money. It ends at that. We don't get more money. Yep, yeah, so we we would have it set up that after you basically set those up so that once the project's done and I think the state requires it. Like you're not allowed to just keep collecting money. You wouldn't get any more money after the 380 said Or once the 380 would be paid for, that kind of closes it out. For the trail. For the trail. For the trail. Correct.

So then why is I'm I'm confused then. Why does it say the last sentence in in your recommendation that we approve this it would also allow the EDA to use their They wouldn't have to use their funds. They wouldn't use their funds for the 380,000 and they're sitting on almost a million dollars. Yes, that's what that says. For other targeted economic development. they could use their existing funds for other projects.

good to know so the the residents know that there is a million dollars out there. If we really need this trail and want this trail because of all the reasons you said, the EDA could still put that trail in. Right. Without taxing and without taking taking the tax dollars up to 386,000 build this out in three years and from the school district and or the county. Right, but you could build it out in three years, too. So much each year over three years. I mean there's a lot of options. You know, if I lived in Le Sueur County, I would say go for it. [laughter]

It's going to be cheaper for me to do this than than not doing it. The people in Scott County, they pay Scott County taxes. Their Scott County's not getting their portion of it. Right. So half of our residents are going to benefit financially from from doing this.

But but in a way those Scott County taxes are also then staying home instead of going somewhere else in Scott County to be spent. And unfortunately, I don't just represent the Le Sueur Scott County side, I represent the entire city. So but But I mean if if if, you know, I don't know what our percentage is but on our taxes what percent does New Prague get versus county versus state? It's it's it's roughly it's roughly 40%. It's like 40 40 county, city and then Funny, so you take 20% of 380. That's what the city portion is. Right. That's the school district portion.

Our school district portion. Was that roughly 73-ish? Yeah, that's what I'm saying. You it's not millions of dollars, it's thousands of dollars. All right. Well, it's tens of thousands of dollars. Yeah, well, whatever roughly 20% of that is 60 you know, 73,000 is Josh was saying. It's over nine years. Well, I don't know. Does that one not a one year check. mean a new school teacher? Does that mean that they don't have to charge so much for parking at the high school? You know, that the school district can use that $73,000 or whatever it turns out to be. That's not one year. So It's spread over the length of the It's still money coming out of it.

Right, but it's not one year. It's not like 73,000, that's a teacher salary. It's you know, if it's nine years, it's $8,000. Right. So, it's going to cost the school $8,000 a year or $9,000 a year.

Again, we're making that decision for them when they would have captured it well, we'll know the number exactly. Right, but I'm just saying it's it it it's it's not as big as numbers you think annually. Okay. All right. Is what I'm saying. If it's if it's 380,000 and they're talking a nine-year TIF I mean, it's and that's all we're we're asking for. We're not asking for a $2 million TIF. We're just asking for $380,000 to do this trail. Right, but when you guys already have money in your checking account of almost a million dollars in the EDA. Well, EDA I was going to say, I wish I had the million dollars in my checking account. checking account. Well, you two are the representatives of this. [laughter]

I don't have it in my pocket. So, I mean, if you Well, but let me Why don't you just use it to build the trail? say that I mean, we speak about the money the EDA has and they have money because they sold land and there's cash there. But it's returning of cash that the city council many many many years ago started the EDA with with the land, the breeders and all that. So, it's money that's come back in from from the the money the city put into it and the land. So, it's not like it's a big there's no profit being made. I mean, you mentioned that it's a success in the sense that we created jobs and there's that, but financially we haven't made money on the industrial park. We're just getting it back from the land and the resources that was put into it and it's being churned over and over again to other EDA projects and things like that. So, it's not like there's no there's not a profit that the EDA or unless the Chuck has made or anybody. But so, it's it's kind of deceiving. So, when you see the cash, yeah, we can stop EDA work or not have an EDA anymore and then take that money and use it for something else. City Council can do that.

And we have done that I think in the past with with some of those first years where we raided that. I've not I've never seen it as big as a million dollars. Well, we raided the ambulance fund to pay buy that land for $1.5 million. I don't recall the initial the park right now. The phase the final phase, yeah. That's where we got the money from. How about that first 10 lots or whatever? Was that just tax dollars out of the general fund that purchased that? Cuz I don't think the EDA had the kind of money to purchase that. No, the land and the breeders was bought. Oh, I don't know about the first phase. Yeah. I have no idea how that was I think that was borrowed against the uh utilities.

Utilities, I think, yeah. Yeah, the utilities borrowed them the money. All right. So, but I think it's I guess unless I hear different, I guess we're looking to If we want to a little bit more information on it, right, Sean? Yes, it is. June? Yep. Yeah, so I guess the yeah if if if the city council's all right with it, just kind of moving forward to kind of start this process. Obviously, like I said, we're not approving anything. In fact, we are on a very much a fact-finding mission at this point and we'll get those analysis from Ehlers um in early June, yes. Okay, great. And that'll get us give time to hear some uh feedback feedback from them. Oh, for sure. Yes. But it'll also give you the numbers you're looking for.

Yes. Thank you. I think we should pursue it. I'm not excited about the school part of it. I I Scott County's been very supportive about any kind of economic development activity that we've done it and partnered with us. The school has been lukewarm, so I'm a little more concerned about that part of it, but Okay. Okay. But yes, I'll vote for moving it forward. Yeah, we don't need a vote. Yeah, we're just [clears throat] directing staff to go forward on researching it. Okay? We're not making any Yep, I know I know what you're saying. [laughter]

So, next we got the SCALE pool insurance pool. And based on reading this, it's saying you guys are recommending not to be part of the pool. Yes, so I know that Explain that cuz it looks like the short term, it's a better deal, but what's the concerns long term? Yeah, so kind of before you came back, Chuck, SCALE, which is a BC and BC an un- an unofficial conglomerate of all the Scott County cities, um school districts, townships, that sort of thing. Uh they started wondering, "Hey, like most most of the communities are not in an insurance pool. They go they go out and they get um insurance individually like New Prague did before we joined Sourcewell here a few years ago. Uh pooling together over the last few years, um talks have been real preliminary. Is this happening? Is this not happening? And for the city at least, it's been more advantageous to kind of say, "You know what? Like we'll keep playing along cuz the process isn't going yet, but as of right now, we're not jumping in because we're already part of a pretty large stable pool um that has a number of benefits to it. So, just was it last week, Robin? Two weeks ago? Um since the last meeting, we did end up meeting uh with the uh from Gallagher who's kind of overseeing this process for SCALE. And they did give us if we were to join their pool as of right now with their estimates, they think that it would be about a 5.7% increase for 2027 on our insurance. Now, this as you mentioned, Mr. Mayor, is significantly less than the cap that has been given to us at 19%. That's not the rate given to us. We we're kind of make decisions based off of that cuz that's the cap. Um but that's kind of [snorts] been the cap

given to us by Sourcewell for 2027. Um these these rates are basically based off of our scores for the last couple years. If you remember it, we had a number of years where I think we were beating most communities in terms of insurance rates. Um and we did uh have have some claims that they bumped us up. And so, the last time we received any sort of analysis from Sourcewell was here uh last summer, I guess it was. And so, we have not received any updated numbers from where Sourcewell thinks we're going to come in. Now, as you read my memo, I do say even though we are at a higher cap at Sourcewell that I recommend staying with Sourcewell over SCALE, and this is why. Right now as the SCALE pool is going together, one of the major bylaws that they're looking putting in, um and I say they, it is SCALE. So, if you were to join, like you are a sitting board member and one vote on the board. Um one of their points that most people are in agreement with is that they would want a five-year commitment out of anyone who joins. Um from the time you join, whether you join now, next year, two years from now, they want a five-year commitment. Um to try to hold their the the stability of the pool a little bit. Sourcewell does not currently require that. Sourcewell does not require that you commit for a certain amount of time. Part of this is also pairing with the next item where we are going to discuss going out for an RFP for a benefits provider in that we have had people come talk to us about, "Hey, have you considered switching?" like sales pitch. Robin and I get sales pitches all the time about everything. Um there are potentially other options out there that they'd mentioned and I maybe Robin even remembers what some of them are called that aren't necessarily insurance how we are doing it. Um and I don't I don't know may may Megan

speak to those. I know she was in the insurance industry for a while, maybe she can't. Um all that being said, if we were to commit to a SCALE, that kind of locks us in for insurance. And I would argue there may not be a reason to go out for benefits provider because this is kind of the benefit we are now providing for the next five years through SCALE. And and I think for me at least, it is that five-year commitment initially right now without us getting to go out and see what else is out there that is keeping me on the fence of wanting to join. It is entirely possible we join next year. Like we we wouldn't be in on the initial build all the bylaws out, but you would still have a seat at the table once you joined. And so, this this isn't in any way locking us out in the future. It's just say would say for 2027, even though you're dangling this potentially lower rate, it would be a smaller pool than what Sourcewell's currently part of. Um and there is just unknowns as this whole process is getting built out and it's very it's preliminary, but they're still trying to get this thing pulled together for 2027. Um that to me, it just feels like staying with Sourcewell. The reason why this is before you now is they we were told that we're at a drop-dead like um May 15th, are you in or you out? type of situation. Um And they're not providing any cap on any of these. They're not providing a cap. They're basically just they're going to They're just dangling I don't even know if it's Gallagher who's going to run the numbers for them yet. Um that was just Gallagher's numbers. I even cuz I asked him like I was like, "We're currently getting told our old cap was this. Like why are you giving us such a much lower number?" And he said, "Oh, everyone runs their numbers a little differently. This is just how I run the numbers when see you guys coming in at." So, it's possible it could come in higher. It's possible it could come in lower once we actually joined. I just feel like at least for this year, if we would like to explore cuz we've been with Gallagher for as long as I've been here and it sounds like far longer. If we'd like to explore other benefit benefits providers and what they may know about or have

access to, joining the SCALE pool kind of nullifies that cuz that really locks us in to joining scale for five at least five years. And they can't provide obviously finalized underwriting until they know who's in the pool. Correct. So, well, that's that's risky. And I do know So, I mean, from things I've heard, I know there's at least one one other community in the pool, and I'm not going to name names. Just put them out there. One other community who's in these numbers who said that they are not joining. They may join in the future, but that they are certainly not joining. I have also heard there's a couple larger communities outside of Scott County that have are considering joining in. So, there's just a lot of flux up in the air with scale. And it feels like we'd be locking ourselves into something that we don't know. We come in we could we could They may have a successful first year, and maybe this time next year we say, "Hey, could you give us a quote and potentially write us in?" And we would just come in on year two. But, the saying no does not lock us out of any future scale. It just I think allows us more flexibility to explore what is out there, as well as let them kind of get their feet under them, so we know what we're working with. All right, because they don't even have um a locked-in provider network or Correct. All of that is in flux. Yeah. So, I would guess I would I would say to this point, if there is action to take, I guess I would just ask that council basically state that we do not want to join the scale pool for 2027, so I can pass that along. Or if they would like to keep their hat in the ring, um that does kind of move us into the scale pool. Or at least I should say keeps us talking.

But, it also um Oh, sorry, Josh. No, I was going to say, but it also basically, from what we're getting told from Sourcewell, it allows them to take their cap off. And so, it it if we end up with less than 19, it's not going to matter anyway, but it would allow them to go higher than 19 because we're out there looking without giving them notice. Got us over a barrel. [laughter] So, that's what Gallagher's telling you. This is what Gallagher Through Sourcewell. Yes. But, the real issue right now is Scale is saying they it May 15th is our date to talk to answer Scale.

Yep, so Scale is using Gallagher to kind of put all their stuff together and have been given the date of, "Hey, May 15th," so that way we're actually start able to pull numbers together and get better hard numbers to people. No. It's It's It's one of those things where I certainly understand the the cost is way lower. I would just hate to lock us into a corner on something that it turns out in a year or two Yeah, unless unless they can say, "Hey, it's it's only going to go up a maximum a year 10%." That that's, you know, cuz it's 5.7 this year, it could be 25% next year. Yeah, there's There's no caps in line.

There's there's just too much unknown of the whole pool Yeah, they're starting a new pool and and providers and in plan benefits and You know, I'm assuming each city that goes in there or county and that stuff probably has a history on it that they can load into the pool in a Yep, yeah, so yeah, they basically get their claims data and that's how they figure it out.

so I mean, claims data. And um No, I I know they'd even mentioned too, it's it I don't Was it going to be a self-funded pool? I I do know that they basically as a pool, they're requiring a larger upfront payment because obviously when claims come in in January, you have to be able to take those claims.

Yeah, they want the three months ahead of time, so that they have funds to I I I will say I there like I said, for us and well, we are currently the only one in a pool. I know um city of Savage was also in the Sourcewell pool for a number of years, and they left because they really liked HealthPartners as a provider. And when Sourcewell switched to Blue Cross here last year, um they wanted to stay with HealthPartners, so they jumped out of the Sourcewell pool. So, I think we might be the only one left that's actually in a pool. For everybody else, like they have had horror stories. Like I know we've had one year one year with relatively bad rates here this last year. Talking to other communities, it's like every year 10, 12, 13, 14, 15%. And so, I think for communities not in a pool, they're salivating at the possibility of maybe trying to stabilize a little bit. Yes, we've had a bad certainly a bad last year. We don't know where this year will be um once it all finally comes in if we end up staying with Sourcewell, but um it just feels like there's more stability shown long-term stability with Sourcewell at this point that I would hate to get us out at a potential new thing that we just don't know about yet. Okay. Okay, um I guess I'll make a motion to uh stay out of the Scale insurance co-op. For 2027. For 2027.

For 2027. I'll second. Okay, I got a motion and a second. Any other questions? Comments? All in favor say I. I. Any opposition? Okay. Next, benefit consultant RFP. I assume this is more of a due diligence to see if uh some of those sales calls you got are worth looking into. Yeah, I'll let Rob or Robin take it. Okay. She She had a whole presentation put together. I know. I'm giving you 30 seconds. Let's go. [laughter]

I was hoping a couple hours. Um You need a teleprompter or something or what? No, I don't have a presentation, but um as Josh Josh prefaced in the previous topic, um so Gallagher is our current agent of record. Um we've worked with them with for many years. Um we had been contacted by a group um and then since other groups and meeting with some. Um like Josh alluded to, one of the things I wrote down was something called Brainshark, um where they do um some AI work and I don't know that we're necessarily are like specific to knowing what we want, and that's why we thought we should probably go out for RFP at at this point. Um Gallagher has certainly served us very well, and just because we're going out for RFP would not mean that we wouldn't end up with Gallagher. Maybe we still will. But, we um thought it was our due diligence, which I I think you may have already mentioned, Mr. Mayor, um to conduct an RFP. And we can do so still this year with an effective date of July 1, 2026, um which would still give us enough time for the renewal process effective January 1, 2027. Um So, if you have questions, I can certainly answer them. Otherwise, I I think I went over my 30 seconds. 32. Uh any questions? I don't have any issue with Do you need a a motion to give you authority to go for the RFP? Yeah, I would. Okay. I'll make a motion to go out to the uh for a benefits consultant RFP. I'll second. It's seconded by Maggie

Bass. Any other questions? Comments? All in favor say I. I. Any opposition? Okay. So, there you can see there's things in your uh miscellaneous section. Uh so, we'll just go with going around the table. Rick, do you have anything? Nothing. Bruce? Sean?

Nope. Maggie? No, sir. Josh? No. Ken? No. Robin? Uh just that you should be receiving your audit document shortly in preparation for the May 18th meeting. Okay. Tim, anything? I don't have anything. Matt? No. Mitch? Ryan, anything else? Patrick, are you with us? Got anything? Okay, the only thing I have is uh the I was looking at the joint powers presentation, and I know that their budget and that uh something I would like to maybe consider and bring forward is maybe redoing the joint powers agreement. Cuz I'm reading it, and there's a section about the construction of the pool and all this stuff. Um I think at this time we might want to you know, it's nothing pressing, but I think it's something that should we look at. Just update [snorts] it. Update it and see if if it should be cleaned up to the point now that we've been having the pool and having the fitness center and things like that. Uh And kind of tighten up the control of that because you know, I I I I understand that it when we went into it day one, we knew that the city was going to help subsidize that um facility. Uh but it sometimes it's feels like uh from reading the minutes, it just seems like sometimes we are running our head into they're making decisions at from the school level. And it really should have been the joint powers making that decision. You know, um and I'm going to have lunch with Andy and kind of talk to him about it, too, but I just reading it just seems like it's outdated. Um and you know, we when we don't need to have all the language in here about

the building construction and what the city was doing and and things like that. You know, that's over the water over the dam. So, I just want to put that on the radar to to maybe go forward and maybe at the next joint powers agreement meeting in May 18th, that can be brought up that as a suggestion that, you know, maybe we should revisit

revisit that. Yep, I've got a note to do that. So, okay, that's all I had. If not, Rick, you're going to do a motion for adjournment? I move to adjourn. Okay, I'll second it. Any other questions? If not, all in favor of adjournment, say aye. Aye. Any opposition? We're out of here. Uh we'll give you five minutes to get out of here. No, and we have a closed session meeting after this. [snorts] Thank you, everyone. You know, when I first came up