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MINUTES REGULAR SAINT MICHAEL CITY COUNCIL MEETING January 24, 2006 Saint Michael Council Chambers 7:00 p.m. Present: Mayor Jerry Zachman; Council Members Joe Hagerty, Dean Eggert (7:20 p.m.), Joe Marx, and Cindy Weston; City Engineer Steven Bot; City Attorney Nate Allen; City Administrator Robert Derus; and City Clerk Carol Beall. Mayor Zachman called the meeting to order, declaring a quorum present. The Pledge of Allegiance was said, and the Mayor welcomed those in the audience. Set Agenda. Engineer Bot added a Town Center Senior Housing Update to his report. Council Members Hagerty/Weston moved approval of the agenda, as amended, with all voting aye. Citizen Input. Paul Vorderbruggen, representing Timber Bay, was present to introduce himself to the Council and let them know a little about the Timber Bay organization. Vorderbruggen graduated from STMA High School and has worked for Timber Bay for over seven years. He now plans to start a group in the St. Michael-Albertville area. Timber Bay is a Christian mentoring organization for at risk youth. Their camp, which is about 89 miles from St. Michael, is their primary base of operation, with follow-up in the community. Vorderbruggen said, beginning in April, he will be approaching law enforcement, schools, social services, etc. for referrals to St. Michael-Albertville Timber Bay. He said he appreciates the City’s awareness of a need with regard to St. Michael youth. Traditionally, the program has started at Age 14 through high school and beyond; however, Vorderbruggen said more 11-and 12-year old at risk youth are being seen, so it is possible going to a younger age will be considered in the future. One goal is to get community organizations more involved. Timber Bay is a state-wide organization working in eight areas of Minnesota--mostly suburban and rural--for 35 years. The organization saw this as a good time to start something new in the St. Michael-Albertville area. Vorderbruggen answered Council questions. Consent Agenda. After brief discussions, Council Members Weston/Hagerty moved approval of Consent Agenda Items a) through l), as listed below. All voted aye. a) Resolution #01-24-06-01 Approving City Council Minutes of January 10 and 17, 2006 b) Resolution #01-24-06-02 Acknowledging Receipt of the December 2005 Investment Report c) Resolution #01-24-06-03 Approving the Annual Board of Review Meeting for May 4, 2006 @ 3:00 P.M. d) Resolution #01-24-06-04 Approving the Hanover Athletic Association conducting Lawful Gambling Activity at the Corner Bar, 10 Main Street South, St. Michael, 04-01-06 through 03- 31-08 e) Resolution #01-24-06-05 Authorizing an Interfund Loan for Advance of Certain costs in Connection with Tax Increment Financing District No. 1 (J&B Expansion TIF District) f) Resolution #01-24-06-06 Approving Renewal of Knights of Columbus Charitable Gambling Lease at Ditto’s Bar, 23 W. Central Avenue, St. Michael, 04-01-06 through 03-31-08 g) Resolution #01-24-06-07 Acknowledging Receipt of WWTP Report for December 2005 h) Resolution #01-24-06-08 Approving Purchase of Fire Department Office Furniture i) Resolution #01-24-06-09 Approving Purchase of Fire Department Telephone System j) Resolution #01-24-06-10 Ordering Feasibility Report for TH 241 One Way Pair Project k) Resolution #01-24-06-11 Approving Payment No. 9 (FINAL) and Change Order No. 1 to Visser Scraper Service LLC for the Reed Bed Expansion Project in the amount of $91,959.70. l) Resolution #01-24-06-12 Approving Renewal of Community Charities of Minnesota Gambling Lease at River Lanes 2006 Bond Presale Report, Mark Ruff, Ehlers. Mark Ruff of Ehlers & Associates, Inc., addressed the Council about a proposed Bond sale. He introduced himself and told about his career with Ehlers. He then referred to the current issue, calling for sale of $6.215 million General Obligation Permanent Improvement Revolving Fund Bonds. The funding is proposed for the Community Center (Civic CC – 01-24-06 – Page 2

Center) project, the 30th Street NE Improvements, and the One-Way Pair funding. (Eggert in) Ruff explained the proposal and answered Council questions. Council Members Hagerty/Weston moved approval of Resolution 01-24-06-13, providing for the sale of $6,215,000 General Obligation Permanent Improvement Revolving Fund Bonds, Series 2006A. All voted aye. COMMUNITY DEVELOPMENT REPORT EDA Report. The Council was provided with draft minutes from the January 18, 2006, meeting of the Economic Development Authority. Community Development Director Weigle was attending a meeting in Rogers, so Administrator Derus reported only one action was forwarded to the Council from that meeting, which was a recommendation to terminate the purchase agreement with Moen- Leuer for Lot 5, Block 1, St. Michael Industrial Park, and return the $10,000 earnest money. After discussion among the Council, Council Members Hagerty/Marx moved to terminate the purchase agreement with Moen-Leuer for Lot 5, Block 1, St. Michael Industrial Park and to return the $10,000 earnest money, as recommended by the EDA. All voted aye. School Siting Update. Engineer Bot reported he and Community Development Director Weigle met with the STMA School District Architect and Superintendent, along with the Administrator and Engineer from Albertville. He showed the area where the district is close to a purchase agreement for property for the upcoming high school and elementary school. He pointed out potential layouts for roadways, and reported Albertville is looking at permanently servicing the property with sewer. That is doable at their current plant, where there is also capacity for expansion. This should be discussed at the joint meeting on Monday. There was discussion on various possibilities and scenarios, including billing, WAC and SAC costs, flood mitigation and possible alternate energy uses. CITY ENGINEER REPORT. Accepting Feasibility Report and Ordering Public Hearing- Town Center Civic Site Phase I. Engineer Bot provided the Council with a feasibility study/preliminary engineering report for Town Center Civic Site Phase I Roadway and Utility Improvements. Bot explained what was involved in the project – road sewer and water, as well as storm sewer. Council Members Eggert/Hagerty moved approval of Resolution No. 01-24-06-14, accepting the feasibility study/preliminary engineering report and ordering a public improvement hearing February 28, 2006, for the St. Michael Town Center Civic Site Phase I Roadway and Utility Improvements. All voted aye. Accepting Feasibility Report and Ordering Public Hearing – TH 241 One-Way Pair Project. Engineer Bot also provided the Council with a feasibility study/preliminary engineering report for TH 241 One-Way Pair Project Roadway and Utility Improvements. Council Members Weston/Hagerty moved approval of Resolution No. 01-24-06-15, accepting the feasibility study/preliminary engineering report and ordering a public improvement hearing February 28, 2006, for the TH 241 one-way pair roadway and utility improvement project. All voted aye. 2006 Computer Purchases. Bot explained the need for upgrades of computers at City Hall and as recommended by the City’s computer consultants. He also explained the recommendation for a black and white laser printer for the Fire Department. Lastly, it was recommended the virus protection be upgraded from the current version. Staff was requesting Council approval of the recommendations. Council Members Weston/Hagerty moved to approve the purchases as recommended, which were within the budget. All voted aye. Town Center Senior Update. Engineer Bot said he talked to Scott Dahlke about the soils report for the proposed senior housing area in Town Center. It was a verbal communication and Bot has asked to receive a copy of the soils report. Bot explained the verbal communication and the reason for the high cost estimate for corrections. The underground parking proposed for senior housing is an advantage, as well as parking areas which would not require as much correction. There would be a significant savings to use the area for the senior proposal over town homes—probably half or more. Administrator Derus reported he met with Developer Mike Leuer and Gina Carlson, an architect with CC – 01-24-06 – Page 3

Interspace West, Inc., who has expressed an interest in the senior project. They will be taking a good look at it before submitting any proposal. Derus said they did ask about TIF financing. At this time they were talking about proposing 100 units and also about multi-level (different levels of care needs) within the same building. Bot will get a copy of the soils report and as further information is received, the Council will be kept informed. CITY ATTORNEY REPORT. Attorney Allen had nothing specific to report. CITY ADMINISTRATOR REPORT. Alcohol Sales Training. City Administrator Derus provided the Council with a letter from Wright County Public Health Department informing the City about upcoming alcohol sales training. The City is being encouraged to inform/mandate the sales training to licensed liquor establishments. Councilor Hagerty said all liquor establishments had been informed of the training, so the City will not need to forward the information. Derus said the Council had wanted to upgrade the City’s ordinance, and it will be reviewed for upgrading. Meeting with Albertville Council – February 8, 2006. Derus reported the Albertville City Council approved a joint meeting with St. Michael’s Council February 8, 2006, at 7 p.m. at the Albertville City Hall; however, St. Michael’s Mayor has a conflict on that date. The Council suggested February 15 as an alternate date and will check with Albertville on Monday at the joint meeting. Council Members Hagerty/Weston moved to set a joint meeting with Albertville and St Michael City Councils for February 15, 2006, at 7 p.m., at the St. Michael City Hall. All voted aye. 2006 Budget: Special Revenue, Capital Project, Debt Service & Enterprise Funds. Derus reviewed with the Council 2006 Budget funds, other than the General Fund. He went through each of the funds, explaining each and answering questions. Council Members Weston/Marx moved to approve the 2006 Budget Other Funds as recommended by the City Administrator. All voted aye. 2006 Goals. Derus said he received goal forms from two Council members and was looking for the other three. He will then arrange for tabulation of the responses and put the subject on the next work session. The list may be supplemented with some staff suggestions. Building Department Activity. The Council was given a memorandum from Building Official Clayton Talbot, which outlined recent activities and expected upcoming activities in the Building Department. Derus said Talbot can be contacted directly with any questions, or he could come to a future meeting if the Council asked. Administrator Performance Review. Derus said Councilor Joe Marx volunteered to do the Administrator’s performance review. Derus was looking for one more volunteer. Council Member Dean Eggert volunteered to serve with Joe Marx on the Performance Review Committee. APPROVAL OF CLAIMS. After explanations, Council Members Weston/Eggert moved to approve Checks #20317 – 20405 in the amount of $4,041,413.74; and Debit Card Transactions of December 31, 2005 – January 18, 2006, in the amount of $1,109.20. All voted aye. Adjourn. After brief discussion, Council Members Eggert/Weston moved to adjourn at 9:55 p.m. All voted aye. Attest:

______City Clerk Mayor