Loading...
HomeMy WebLinkAboutApproved Minutes - 2010-09-07 PMCITY COUNCIL REGULAR MEETING MINUTES September 7, 2010 Council President Roger Hennagin called the regular City Coun:-�" meeting to order at 6:36 p.m. on September 7, 2010, in the City Council Chambers, 380 A Avenue. Present: Council President Hennagin, Councilors Olson, Moncrieff, Tierney, Jordan, and Vizzini. Mayor Hoffman was excused. Staff Present: Alex McIntyre, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Christine Kirk, Public Affairs Manager; Joel Komarek, LOIS Project Director; Jane Heisler, LOIS Communications Director; Ursula Euler, Finance Director; Denny Egner, Long Range Planning Manager 3. PRESENTATIONS 3.1 Distinguished Service Awards: Brent Ahrend, Transportation Advisory Board Council President Hennagin presented a Distinguished Service Award to Brent Ahrend and thanked him for his service on the Transportation Advisory Board as Vice Chair. He mentioned Mr. Ahrend's knowledge of traffic engineering as a traffic engineer with Group MacKenzie. Mr. Ahrend indicated to Council President Hennagin that he was born and raised in Lake Oswego. • Ron Gronowski, Sustainability Advisory Board Council President Hennagin presented a Distinguished Service Award to Ron Gronowski and thanked him for his service as an inaugural member of the Sustainability Advisory Board. He mentioned that Mr. Gronowski's interest in the practice of sustainable design. Mr. Gronowski indicated that to Council President Hennagin that he has lived in Lake Oswego for 23 years, and was transferring to the Foothills Citizen Advisory Committee. • Nancy Gronowski, Natural Resources Advisory Board Council President Hennagin presented a Distinguished Service Award to Nancy Gronowski and thanked her for her service on the Natural Resources Advisory Board. He mentioned that she was a landscape architect and a planner for the Portland Parks Bureau, as well as a volunteer on the Second Look Task Force. He noted that she was transferring to the Parks & Recreation Advisory Board. • Morgan Holen, Natural Resources Advisory Board Council President Hennagin presented a Distinguished Service Award to Morgan Holen and thanked her for her service on the Natural Resources Advisory Board. He mentioned that she was a forester who also volunteered on the Century Tree project. Ms. Holen confirmed that she worked part-time for the City as an Assistant Natural Resources Planner. She indicated to Council President Hennagin that she was a fourth generation forester. • Adrianne Brockman, Planning Commission Council President Hennagin presented a Distinguished Service Award to Adrianne Brockman and thanked her for her service on the Planning Commission. He noted that she was resigning from the Commission. Ms. Brockman indicated to Council President Hennagin that this was her second term of service on the Planning Commission. raving served her first term from 1981-1990. City Council Regular Meeting Minutes Page 1 of 16 September 7; 2010 She mentioned getting the infill code amendments to the Council as an accomplishment. She said that she was a lawyer with a master's in planning. She expressed her appreciation for the opportunity to serve her community. • Philip L. Stewart, Planning Commission Council President Hennagin presented a Distinguished Service Award to Philip Stewart and thanked him for his service on the Planning Commission. He mentioned that he was resigning from the Commission. He noted that Mr '�tewart served as Commission Chair and worked to make the development code more user- r�-3ndly. Mr. Stewart indicated to Council President Hennagin that he served on the Commission for two and a half years. He mentioned the infill amendments to the Code, beginning Periodic Review, and working with the Sensitive Lands Ordinance as accomplishments. • Robert Galante, Redevelopment Director Council President Hennagin presented a Distinguished Service Award to Bob Galante and thanked him for his years of service with the City. Mr. Galante recalled that he had worked with Ms. Brockman and Ms. Gronowski early in his career at the City. He reviewed his tenure at the City, starting as a Development Review Planner, then as a Senior Planner and Planning Director before his appointment as Redevelopment Director. He described the City staff as his extended family. He commented that he has enjoyed working on the many downtown redevelopment and other City projects over the years. Council President Hennagin mentioned that Mr. Galante was involved in the planning for Millennium Plaza Park, the Headlee Walkway, Lakeview Village, Foothills Park, the Kincaid Curlicue Park, and the A Avenue, State Street, First Street and Evergreen, and Leonard Street improvements. He commented that the City would miss his expertise and experience, and wished him luck in his retirement. He led the room in a round of applause. 3.2 Federal Legislative Update Ms. Kirk reported on the federal legislative efforts undertaken by Capital Edge on behalf of the City since the last update (pp. 1-2). She mentioned Capital Edge helping the City make strategic investments of time and gain access to the Congressional delegation. She described the City staff and Capital Edge as working together as a team. She noted the number of issues revolving around water, such as questions from the Oregon Water Utilities Council and assistance with the federal permitting process for the Lake Oswego/Tigard Water Partnership. Chris Giglio, Capital Edge, attended by Skype from Washington, D.C. He noted that Congress was currently in its summer recess, and not expected back until next week. Following the October 8 scheduled end of the next session, Congress would not reconvene until after the November elections for a lame duck session. He mentioned the Energy Efficiency and Conservation block grants and the formula grants to states for recreation and conservation activities (in the Energy bill) and an extension of the bond provisions in the 2009 stimulus package (Build America Bonds) as items anticipated for Congressional debate that were of interest to Lake Oswego. He mentioned the expectation of much debate regarding the FY 2011 budget. He observed that deficit reduction has been a major topic of discussion in Congress. Consequently, the budget hawks were eyeing domestic discretionary funding for cuts in FY 2011. Unfortunately, many programs that could assist local governments fell under domestic discretionary funding and might not see much growth. He reported that Representative Schrader and Senators Wyden and Merkley requested the respective Appropriations Committees to consider the two projects that Capital Edge helped the City officials identify earlier this year for 'earmarking' in the FY 2011 budget- the Foothills planning effort and wastewater treatment projects. He explained that these projects had significant local City Council Regular Meeting Minutes Page 2 of 16 September 7, 2010 support and contributions, -they were projects that federal money could complete, and they met the program eligibility requirements, which made them attractive to Congress. He described the Congressional delegation requesting both projects as showing significant progress in educating the Congressional delegation on Lake Oswego's needs. However, due to the deficit and anticipated budget cuts, he did not think it likely that Congress would fund the projects in FY2011. He pointed out that sometimes getting funding for projects was a multi-year process. He mentioned the outside chance of Congress including funding for the wastewater projects in thy. FY2011 budget for the EPA. He mentioned ether projects they continued to work on behalf of the City; such as potExitial federal grant opportu,nities, discouraging federal intrusion into local matters, and public safety issues. He reported that the City submitted an application to the Tiger 2 grant program run by the Department of Transportation, which was a transportation, land use, and sustainability initiative. He commented that, although the City had a strong application, even if it failed, they hoped submitting it would bear fruit in future proposals by demonstrating the City's commitment to combining these three elements. He reported that the City's early application to a program in the new health care bill about reimbursing local governments for up to 80% of health care costs related to early retirees (or $90,000) has been approved. He indicated to Council President Hennagin that it was a $5 billion program conducted on a first come, first served basis. He clarified that the program intent was to encourage local governments to continue to provide benefits. He acknowledged that an unintended consequence would be to open up employment opportunities for non -retirees. Mr. Giglio indicated to Councilor Vizzini that specific program in the EPA funding stream to which the City made application was the State and Tribal Assistance Grants program (STAG). He explained that this was an earmark for local wastewater treatment facility upgrades. The City made its application for the Foothills planning effort to a $150 million joint program from HUD, DOT, and EPA seeking to combine land use, sustainability, and transportation. He reiterated that they did not expect to see increased funding to these programs due to the deficit concerns. He indicated to Councilor Vizzini that he saw prospects for funding through EPA for the City's anticipated watershed planning work, as watershed planning was a hot topic at conferences and on the EPA's radar screen. He commented that, while there was not significant programmatic funding yet, his impression was that the US Army Corps of Engineers and the Department of the Interior wanted to work in this area in the future. Mr. Giglio left the meeting. Mr. McIntyre indicated to Councilor Olson that he had not intended to bring back the Capital Edge contract renewal to the Council for discussion, as its renewal was under his authority. However, if the Council wished to discuss it, he would bring it back. Councilor Olson recalled a Council conversation about discussing the results of this work after one year to see if the Council agreed to continue it. Mr. McIntyre said that his recollection was that the Council decided that one year was an insufficient length of time to evaluate adequately the success of this program; it would need two to three years to show success or lack of success. He recalled that he had explicitly told the Council that the success of this legislative effort was not in bringing the money home, but rather in influencing decision makers in Washington D.C., and getting Lake Oswego on the radar screen. Councilor Tierney commented that he did measure success by bringing home the money as an investment. He concurred that the budget discussions did conclude that a one-year time frame was too short to assess this work. He advocated for continuing the contract for another year. Council President Hennagin indicated that he also recalled the conclusion that they would take two to three years to determine whether this program was worthwhile or not. City Council Regular Meeting Minutes Page 3 of 16 September 7, 2010 3.3 Water Partn rship Update Mr. Komarek reported that the team was working on project definition and assessing the conditions of the existing facilities in order to quantify and characterize the challenges they would be facing during construction. He mentioned the tribal burial grounds near the intake and raw water pipeline. He indicated that both Lake Oswego and Tigard, as joint applicants for an extension, and the opponents filed exceptions to the administrative law judge ru;Ing in August. He explained that the participants felt that the ruling granted some authority to this Oregon Department of Fish & Wildlife that was not part of the original conditions. He noted that the Director had no time limit on issuing his final order, but once he did, the parties had 60 days to appeal the final order directly to the appellate court. He mentioned the six distinct projects identified through project definition: the Clackamas River intake facility, 14,000 feet of raw water pipeline crossing the Willamette, connecting that pipeline to the treatment plant in West Linn, 35,000 feet of treated water to the Waluga Reservoir, the Tigard connection to the Waluga Reservoir, and Tigard's distribution system. He reported that their assessment of the existing pipelines found 50,000 plus feet of pipeline with no quantifiable leakage and a better than expected condition. He mentioned the consensus recommendation by the expert panel and the Citizen's Sounding Board to use the conventional water treatment method plus ozone. He indicated that they would discuss these issues with the Oversight Committee and the Council. He commented that there was an interested group of neighbors of the Waluga Reservoir wanting to have input into the facility design. Ms. Heisler discussed their good neighbor outreach efforts to engage all the facility neighbors, particularly those neighbors who would experience the most impacts during construction. She mentioned the Robinwood Neighborhood and the Maple Grove Plat property owners in West Linn where the treatment plant was located, and the Waluga Reservoir neighbors. She explained that the City had to get 75% approval from the Maple Grove Plat property owners to use the properties to the south of the treatment plant for any type of water -related facility. The team was sounding them out about an underground clear well and a small pump station. She noted that the project proposed a 3.5 million gallon reservoir at the existing 1 million gallon Waluga Reservoir site. Ms. Heisler indicated to Council President Hennagin that about a dozen property owners out of the 85 property owners in the Plat attended the City's ice cream social. She discussed the joint pilot program (Treatment Plant, Engineering, and Water Conservation Specialist) in August and September to encourage people to conserve water. She described it as a way to raise awareness and encourage people to save money and -water as a preliminary to a fuller program next year. She indicated that the team would meet with the City's Water Conservation Specialist at the end of September to see if it had an impact. Mr. Komarek reviewed the meetings scheduled through the end of the year, including monthly Oversight Committee meetings to discuss the progress towards a joint Council decision on the CIP. He mentioned the concurrent Lake Oswego rate update work to see how well the tiered water pricing structure was working. He presented the website address and phone numbers, encouraging residents to log on to the website, which had up-to-date information about the partnership, thanks to Ms. Heisler and her team's work. Councilor Vizzini asked if the City has sufficient meter information to determine whether there was an effect on Beat the Peak this summer. Ms. Heisler observed that that was tied to outside temperatures, yet she doubted that they were pulling much water out of the river. City Council Regular Meeting Minutes Page 4 of 16 September 7, 2010 Mr. Komar k described to Councilor Olson the appeals process -following the Director's issuance of the final order. He mentioned the current thinking that the Director would issue that order within a few weeks to three months. He speculated that it would take a year for the appeal to go through the courts. Council President Hennagin commented that how long it would take was impossible to predict. He conjectured that it could take two years. Councilor Tierney asked Mr. Komarek to summarize the water rights decision because it was a lynch pin for the whole process. If the City did not get the water rights, then the project stopped, yet they were proceeding as if thoy would get it. Mr. Komarek explained that this had to do with the 2005 House bill that turned tie municipal water rights world upside down. Instead of the continual extension of water rights in recognition of cities and jurisdictions growing into their water rights over time, the State decided to allow each jurisdiction a 20 -year block of time. During those 20 years, a jurisdiction had to show that it was managing the existing water rights to the best of its ability, and that the development of the undeveloped rights would not result in harm to endangered species. Mr. Komarek said that Lake Oswego initially applied for water rights extension in 2000 and was halfway through the process when this new legislation came through and put everything on hold. He recounted how two years ago Water Watch and the Southfork Water Board immediately contested the Department's proposed final order approving Lake Oswego's water rights extension. Lake Oswego's efforts to reach an out-of-court settlement were unsuccessful, and eventually an administrative law judge issued a ruling upholding the proposed final order. He concurred that securing the extension of these water rights was extremely important, not only to the Partnership, but also to Lake Oswego alone for growth and economic development. 3.4 LOIS Update Mr. Komarek concurred with Council President Hennagin that drawing down the lake has run into Mother Nature trying to fill it back up again. He reported that the contractors have finished the West Bay CPPP (cured in place plastic pipe) work and anticipated finishing similar work in Lakewood Bay and Foothills early next week. He indicated that they did get the Country Club irrigation systern in place and operational before lake draw down. He discussed several important elements in the project. He mentioned the debris sump installation to collect and trap debris upstream of the lake to prevent debris entering the buoyant pipe and causing difficulties. He spoke of the bypass pumping necessary in working with a live sewer system. He described the work done on the Bryant and Foothills pump stations. He mentioned the City's coordination work with the Lake Corp, not only on the LOIS project, but also on the Corporation's desire to dredge during the lake down phase in order to make some modifications to their dam for flood control benefits. He referenced Mr. McIntyre's memo sent out last week about the City receiving the highest rating by both bond rating agencies for its full faith and credit revenue bonds. Ms. Heisler indicated that the team has been focusing its recent communication efforts on draw down. She noted the Lake Corporation's efforts to advertise its intent to dredge, which meant that owners had to get their boats out of the water. She mentioned the intense media and public interest in the lake draw down. She mentioned the need to update constantly the information on the website as the bypass pumping system would move around the lake with the work on different manholes. She indicated that staff met with three easement groups to discuss the upcoming work near those easements. She noted that the CIPP work in Half Moon Bay, the northeast Arm, and the remainder of Lakewood Bay would require a six-week closure of the North Shore Bridge. She said that the team would communicate with emergency services regarding the one day when emergency vehicles will not be able to travel over the bridge. City Council Regular Meeting Minutes Page 5 of 16 September 7, 2010 Mr. -Komar k indicated that the project was on track witt its schedule with some projects completed ahead of schedule. He commented that he expected the Lake Down Phase to catch up, weather permitting. He reported beginning initial discussions with the Portland Bureau of Environmental Services (BES) about partnering on the Foothills sewer seismic upgrade He reported that the project costs were steadily decreasing over time, with the latest project total estimate coming in at $90 million. COUNCIL QUESTIONS Cues, cilor Jordan thanked Mr. Komarek for the fantastic job that he and hi t,� am have done with keeping the LOIS project moving and keeping all those impacted by the work i-iformed and prepared. She commended Mr. Komarek and Ms. Heisler for their skills in helping this project to proceed smoothly. She commented that she thought the same would happen with the water project, which made her glad that the City had talented people on staff to do this work. Council President Hennagin concurred with Councilor Jordan regarding how well this project has gone. He asked Mr. Komarek to address the confusion among the public regarding the need for a larger diameter sewer through the lake to handle increased present and future sewer flow and yet the City was riot enlarging the pipe through Lakewood Bay but only re -lining it. Mr. Komarek explained that the modeling showed that the West Bay pipeline had adequate hydraulic capacity to pass the designed flows based on certain assumptions. He indicated that an important assumption was that the City would continue to address the infiltration and inflow issues in the smaller diameter collection systems upstream. He emphasized that if the City allowed this to go unattended, then it would see overflows into the lake again. He indicated to Council President Hennagin that the pipe in Lakewood Bay had the same 35 inch inside diameter as the pipe running through the main lake; its size was adequate to handle both storm and domestic flows. He mentioned their determination that there was little seismic risk to the pipe, as it was buried. He explained that re -lining the pipe would extend the useful life and give the pipe more st=ture. 4. CONSENT AGENDA Councilor Jordan moved the Consent Agenda. Councilor Moncrieff seconded the motion. A voice vote was taken, and the motionap ssed with Council President -Hennagin, Councilors Olson, Moncrieff, Tierney, Jordan, and Vizzini voting "aye." [6-0] 4.1 RESOLUTIONS 4.1.1 Resolution 10-49, making appointments to the 50+ Advisory Board Action: Adopt Resolution 10-49, appointing Gail Zimmerman, Debbie Harris and Marcia Robertson to the 50+ Advisory Board, Gale Gipson as alternate 4.1.2 Resolution 10-50, making appointments to the Planning Commission Action: Adopt Resolution 10-50, re -appointing Russell Jones to the Planning Commission and continuing to recruit for additional candidates 4.1.3 Resolution 10 - 55, authorizing an intergovernmental agreement to accept a grant for the Juvenile Youth Diversion Program Action: Adopt Resolution 10-55 4.1.4 Resolution 10 - 56, appointing an additional member to the Foothills Oversight Committee Action- Adopt Resolution 10-56 4.1.5 Resolution 10-57, regarding oversight of Lake Oswego School District's New Sustainability Fund City Council Regular Meeting Minutes September 7, 2010 Page 6 of 16 -- _ Action: Adopt Resolution 10-57 -- -- 4.2 APPROVAL OF MINUTES 4.2.1 March 30, 2010, special meeting 4.2.2 April 13, 2010, special meeting 4.2.3 April 13, 2010, regular meeting 4.2.4 April 20, 2010, regular meeting 4.2.5 May 17, 2010, special meeting Action: Approve minutes as written END CONSENT AGENDA 5. ITEMS REMOVED FROM THE CONSENT AGENDA 6. CITIZEN COMMENT • Jerry Ghiglieri, 667 McVey She asked the Council to waive the fee for the use of the West End Building for the December 4 ceremony honoring the 82nd Brigade, Army National Guard. She mentioned that many of these heroic men and women in the Guard served more than two tours, and others have made the ultimate sacrifice. Mr. McIntyre indicated to Council President Hennagin that waiving the fee was within his discretion, and that he wouid do so. Ms. Ghiglieri thanked the Council and the City Manager. Councilor Jordan observed that this was consistent with the community covenant that the City signed with Clackamas County to support all of their military personnel and their families. She thanked Ms. Ghiglieri for bringing this request forward. Dr. Bill Korach, Lake Oswego School Superintendent On behalf of the School Board, the children and the families, he thanked the Council for its serious consideration of helping the School District financially. He indicated that this financial support made a big difference to the kids, as $75,000 meant one teacher and $150,000 two teachers. He thanked the City staff for their help in getting the Lake Oswego High School building open in time for the students' arrival. He mentioned that Mr. McIntyre has worked closely with him through the year, and the District felt good about its partnership with the City. 7. REPORTS 7.1 One -Time Financial Support to the Lake Oswego School District Mr. McIntyre presented his recommendation to fund for one year on a one-time grant basis support to the School District for the continuation of its aquatics and orchestra programs. He noted that both these programs were consistent with the City's values regarding cultural and youth activities. He commented that; while at any other time he might be more rigorous in defending the Measure 5 line between cities and schools, the Council did put undesignated funds into the contingency funds in anticipation of some future event. He described this as one future event of $150,000 for Council consideration. He indicated to Council President Hennagin that the Council put $256,000 into contingency. Mr. Powell indicated to Council President Hennagin that there could be an issue with the Measure 5 restrictions, depending on where the funds came from. He noted that staff presented this request as a use of franchise fees. He explained that that was a defeasible use, as there were no strings attached to those funds as there were to property tax funds. City Council Regular Meeting Minutes Page 7 of 16 September 7, 2010 Councilor Moncrieff observed that the -Lake -Oswego schools differentiated Lake Oswego from - the surrounding communities. She described this as an appropriate expenditure of funds, as the schools were a community value. Councilor Olson cited an Oregonian article discussing other school districts in the state eliminating music programs. She commented that music programs were something that distinguished Oregon schools. She remarked that strong schools were a prime reason that people moved to this community and a major factor in maintaining high property values. She emphasized that this was a one-tim _• grant. She spoke to the City and the State finding a permanent fix for fr.y problems faced by the r, chool District. Councilor Jordan indicated that she supported this request. She observed that Lake Oswego had one of the strongest school systems in the state; supporting the schools was part of the fabric of this community. She concurred with Councilor Olson that they needed to address school financing as a statewide issue, since education fueled the State's economic engine. She suggested that Ms. Kirk help create a message to send to the legislature about the importance of schools. Councilor Tierney stated that he would support the resolution. He asked the City Manager to incorporate into the details of the agreement a specific linkage between the orchestra and the community, such as holding an orchestra event at a City venue or having a performance open to the community. Councilor Vizzini concurred with the Councilor comments that this issue went beyond the community. He argued that all communities in the state should be advocating for a permanent solution to school funding in the upcoming legislative cycle. He agreed that this was a one-time grant. He mentioned that he saw the Lake Oswego High School fields filled with kids and their parents every evening as he rode his bike home. He held that the linkage between the school students and the new branding of tha community was manifest. He described the students as representing the community when they attended athletic events elsewhere in the state. He commented that he saw the students as part of the community's economic development strategy. He noted the action item on the League of Oregon Cities' legislative agenda to allow communities to vote to exceed the limits of Measures 5 and 50. He argued that the time has come to return to the Lake Oswego citizens having more direct control over the school budget. Council President Hennagin said that he also supported this allocation of contingency funds. He remarked that it was a sad commentary on the State tax system and allocation of funds that the school districts had to raise funds through foundations and charitable giving in order to provide the desired level of education. He agreed that the legislature needed to find a solution. He commented that, while he did not like these "Band-aids," on occasion they did need to use them. Councilor Olson moved to adopt Resolution 10-59, authorizing a resolution transfer of $150,000 from the City's General Fund Contingency to the non -departmental budget to provide one time funding for the Lake Oswego School District. Councilor Jordan seconded the motion. A voice vote was taken, and the motionap ssed with Council President Hennagin, Councilors Olson, Moncrieff, Tierney, Jordan, and Vizzini voting "aye." [6-0] 7.2 LOIS Bond Issue #2 Mr. Komarek presented his request that the Council direct a bond issue in the amount of $35 million for the completion of the LOIS project. He noted the additional $5 million for an expanded scope of work to upsize a piece of the system. He explained that this piece could wait but if the City took advantage of the qualified contractors already working for it, the staff believed they could achieve some economies of scale. He mentioned staff's anticipation that the $5 million could also pay to address some other deficiencies in the small diameter waterfront sewers ringing the lake. City Council Regular Meeting Minutes Page 8 of 16 September 7, 2010 He directed the Council to Exhibit -2.-8 in the handout (p.114, packet), a table that showed -the future rate increases over four years required by a $110 million wastewater funding project, as identified in the December 2009 wastewater cost of service analysis. He mentioned the staff's anticipation of completing the project for around $90 million. He explained that the project was close to cons,.!ming all of the $60 million 2009 bond issue. He spoke of taking advantage of the good credit market climate, the low LOIS project costs, and the availability of qualified contractors for the additional work by issuing $35 million in bonds at this time. Mr. McIntyre commented that the City would have to do the additi,.-,al work in a couple of years anyway. Staff just thought that it made sense to take advantage ol Lhe contractors already on the lake to do that work now. Council President Hennagin asked Mr. Komarek to explain how doing this work now resulted in saving substantial amounts of money. Mr. Komarek explained that the City needed to do re -fine another 4,000 feet of the main Canal trunk sewer and replace and lower 100 existing sewer laterals serving properties abutting either side of the canal because of damage that occurred whenever the Lake Corporation dredged the canal. He explained that mobilization was a huge cost in any project, and with the specialized CIPP contractors already mobilized and on the lake with their equipment, the City saved that cost for this re -lining project in the future. He reiterated that the funds might potentially cover taking care of some additional small waterfront sewers ringing the lake. Mr. Komarek explained to Councilor Tierney that it was difficult to estimate how much this project would cost if done in a few years. He mentioned inflation and mobilization as a higher percentage of a smaller project's costs. He pointed out that the work would have to coincide with future drawdowns initiated by the Lake Corp; when and how far they would draw the lake down were unknowns. He indicated to Councilor Tierney that he would expect to see a $250,000 to $500,000 higher cost in the future over the cost of doing the project today. Mr. Komarek indicated to Councilor Vizzini that staff realized a 30% cost reduction over the engineer's estimate for the Lake Full Phase due to doing the work during an economic recession. He mentioned a 10% cost reduction during the Lake Down Phase. Councilor Vizzini commented that that proved the truth that one should build as much as possible during a recession because the pricing was good. He observed that having the workers in town was another economic benefit. Mr. Komarek said that the contractors expected to have 50 to 60 people on the lake down phase at any given time. Councilor Olson mentioned another cost savings of $100,000 in bond fees if they issued this $5 million in bonds separately. She noted the current very low bond rates also. Mr. Komarek spoke of other additional costs for design work and another bid process, as well as the question of whether these specialty contractors would be available when the City next needed them. Chip Pierce, Bond Consultant, confirmed Councilor Olson's estimate of $100,000 in savings by not doing a separate bond issue. He described taking advantage of these historically low bond yields as an economically sound approach. Councilor Moncrieff asked why staff did not recommend Scenario 3, an additional $10 million in bond issues to take care of the cleaning inspection and condition assessment of the sewer lines ringing the lake. Mr. Komarek explained that staff would not have the inspection work completed to assess the condition of the lines. He discussed his concern about the staffing capacity required to do that work, especially in light of the Lake Oswego/Tigard Partnership coming online. He spoke of finding the middle ground between what could be done and being sensitive to rate increases. Mr. McIntyre asked how soon did the City have to spend the funds, once the City received them. Mr. Pierce said that the rule was that the City had to have a reasonable expectation of spending 90% Df the proceeds within three years. Mr. Mclntyre commented that that changed things slightly for Illrn. City Council Regular Meeting Minutes Page 9 of 16 September 7, 2010 Councilor Olson commented that if Mr. Komarek continued his stellar management -of LOIS, then the City could have an additional $5 million in contingency to use for the additional work instead of issuing bonds. Councilor Jordan commented that Mr. Komarek has justified increasing the scope of work, as Council asked him to do last summer. She pointed out the decreased rate increases under this scenario from the original 2009 estimated rate increases (p.114). She observed that the City was decreasing the expense to the residents' pocketbooks over the next couple of years with regard to sewer rates and still doing more work on ,..e sewer. Councilor Tierney asked Mr. Pierce to a;�souss the risks associated with the Build America Bond provisions. Mr. Pierce indicated that, whi;a there were elements of the Build America Bond (BAB) program that were attractive and would achieve savings, there were also risks. He mentioned the risks involved with the IRS -required certifications by the underwriters. He discussed the loss of the 35% subsidy on the interest with re -funding the BABs in comparison to savings achieved when re- funding the traditional tax-exempt bonds. He explained that if the federal government decided that the City has not used federal money it has received for a given project appropriately, then it could withhold interest subsidies on un -related bonds. Mr. Pierce observed that BABs sounded terrific on their face but there were factors to consider before going with BABs. He said that they might end up issuing straight 25 -year tax-exempt bonds at a rate in the mid -3s. He commented that BABs might have a little lower rate but he was not certain they were worth the offset. He mentioned their intention to sell the bonds competitively, as a more economically efficient way for the City to sell them. Councilor Tierney indicated that he would not be disappointed if the City sold straight bonds. Ms. Euler referenced the earlier question about why staff did not recommend the 840 million bond scenario instead of the $35 million bond issue. She explained that, even with the lower customer rate increases, the City was still accumulating a fund balance that seemed adequate to take care of non -LOIS capital projects or any unforeseen major project. Council President Hennagin commented that he had no doubt that the savings realized in the long run from the various factors articulated by staff would be beneficial. Councilor Tiei ney moved to direct staff to sell $35 million in a combination of full faith and credit tax exempt obligations, Series 210A obligations, and full faith and credit taxable obligations, Series 210B obligations to pay cost of or to reimburse the City for payment of costs of capital improvements to the City's wastewater system, and to pay costs of issuance. Councilor Jordan seconded the motion. A voice vote was taken, and the motion passed with Council President Hennagin, Councilors Olson, Moncrieff, Tierney, Jordan. and Vizzini voting "aye." [6-0] Council President Hennagin recessed the meeting at 8:38 p.m. for a break. He reconvened the meeting at 8:46 p.m. 7.3 Boones Ferry Road Project Phase 2: Consultant Selection and Public Process Mr. Egner mentioned that staff would like to return to Council on September 21 with a resolution appointing an advisory committee and approving the project contract. He explained that Phase 2 was intended to provide a mechanism to make recommendations on the 22 refinements recommended by the consultant during the technical analysis of Phase 1, to pin down a specific right-of-way, and to conduct a public process. He reviewed the consultant selection process (pp. 113-119). He prFsented the staff recommendation to hire HNTB as the consultant (p.119). He indicated that staff was negotiating the contract that they anticipated presenting for approval at the Council September 21 meeting He presented the staff recommendation for a seven -member Advisory Committee (pp. 119-120) comprised of four members from the old Lake Grove Village Center Task Force and three City Council Regular Meeting Minutes Page 10 of 16 September 7, 2010 members from the current Transportation Advisory Board (TAB). He commented that staff did not know at this point whether this project would simply implement the Village Center Plan or develop proposed amendments. Staff would take any amendments to the Planning Commission and the City Council, but implementing the concepts was solely a Council decision. He discussed the proposed schedule. He indicated that, if Council approved this approach, he would meet with TAB later this month and convene the first meeting of the Advisory Committee in October. He said that the goal was to have a six-month project ending in April 2011. He noted the key decision N:�ints listed in the schedule (p.120). Council President Hennagin commented that he had hoped that this would be the lass step and not the next step because the property owners along Boones Ferry Road needed to know where the improvements would be before undertaking any redevelopment or property improvements. Mr. Egner stated that this project would provide some certainty about the location of the improvements but there were still unknowns. He mentioned that one unknown was how the City would pay for the project. He remarked that the Homebuilders Association has tied up a Metro construction excise tax grant in a lawsuit. Mr. Egner agreed with Council President Hennagin's hope that this project would not result in amendments to the Lake Grove Village Center Plan, but he noted that there were a few of the 22 refinements which, if recommended by the Advisory Committee, might require amendments. Councilor Olson commented that she was glad to see this moving along within a six months time frame. She referenced Mr. Egner's report indicating that the Lake Grove Village Plan Advisory Committee had rejected some of the 22 refinements later identified by the Phase 1 consultant. She asked if the new Advisory Committee would actually consider those items originally rejected. Mr. Egner noted that the wording was 'they were considered and rejected.' He gave an example of putting a full service traffic signal in for all four legs of the Lanewood intersection. He recalled that the Lake Grove Plan Advisory Committee had rejected extending Hallmark as one of the intersection legs because of concerns about traffic going past the school. He indicated that, since the Committee never decided whether or not that signal served the redevelopment of the furniture store site, he believed that the question was left open regarding connecting to the furniture store parking lot. He mentioned the Madrona intersection as another traffic signal discussion. Councilor Olson referenced the fourth cost cutting strategy mentioned in Mr. Egner's report, using the accurate, high-resolution aerial photos instead of detailed surveys. She asked if the City would need those detailed surveys in the future. Mr. Egner explained that these photos were as accurate as the staff could get without going to construction level drawings. He indicated that they would only do spot surveys for the construction level drawings, and not a full survey of the roadway. Councilor Jordan mentioned that part of the issue with the 22 refinements was that some of them anticipated growth using models with estimates of future populations. She pointed out that until they resolved the issue at the railroad crossing on Bryant Road, nothing they did on Boones Ferry would alleviate the traffic stacking up. She described the intent of the plan as making a more pedestrian friendly, accessible corridor in the next five to ten years and not trying to implement the 35-year plan right now. She agreed that the Boones Ferry Road property owners waiting to do projects needed to know the exact location of the right-of-way and the pedestrian facilities. She observed that the location of the pedestrian crossings would help identify the locations of future driveway consolidations. Councilor Vizzini thanked Mr. Egner for taking some of his comments about the Advisory Committee into consideration. He said that he was pleased with the Committee's composition. He mentioned his concerns about the scope of work. He discussed the need to make the aspirational Village Center Plan real on the ground through the access management planning process recommended by Planning Commissioner Glisson City Council Regular Meeting Minutes Page 11 of 16 September 7, 2010 He stated that -his concern was that the plan was written with the intent of completing the access management plan and the economic analysis in order to make decisions about the engineering plans, and of having a process to get community buy -in on the refinements. He stated his personal opinion that the program needed more money in order to complete the economic analysis promised to the community, in addition to the resources budgeted for the scope of work proposed for Phase 2. Mr. Egner indicated that the project team included an economic consultant to help with the economic analysis. He said that the scope of work would _ e in the Council's September 21 packet. Councilor Vizzini commented that he saw a significant amount of work to be done in this phase to get to two things: certainty for the property owners regarding the location of the road, and sustaining a community consensus about what the corridor would look like and how it would work. He emphasized that his greatest concern was that, at the end of Phase 2, the City had a consensus about what the corridor would look like and how it impacted the abutting properties. Councilor Vizzini concurred with Mr. Egner that only about five of the 22 refinements identified were controversial, but he observed that they were significant issues. Councilor Tierney asked for clarification on Mr. Egner's statement on p. 118 stating that doing an economic impact analysis separate from the technical engineering work required adding $10,000 to $15,000 dollars to the cost. He mentioned that he would support adding money to accomplish what Councilor Vizzini talked about. Mr. Egner clarified that the contract amount coming to Council in two weeks would be for $140.000 to $145,000, which included the additional money. He said that the originai amount mentioned to the consultants had been $130,000. He explained that staff had asked the consultants for creative ideas on how to pare the costs down. Councilor Jordan noted that the recommended consultant team included the economic piece in their proposal, which none of the other consultants did. Council President Hennagin commented that he thought that the public would be interested to know that staff was taking steps to maintain cost controls, as described in the written staff report. He mentioned that he too had thought that combining TAB members and former Lake Grove Advisory Committee members would be an appropriate composition for the Advisory Committee. Councilor Olson concurred with Councilor Vizzini about the importance of this project and the economic study. She questioned quibbling about $15,000 for this project when the Council was investing over $1 million in Foothills. She commented that she hoped that the Council would move ahead with the financing strategy, even without the Metro grant, because the Lake Grove people have been waiting a long time for this, and the City needed to get it done. Councilor Olson questioned including on the Advisory Committee an individual who, due to the nature of his work, regularly appeared before the Planning Commission and City Council with projects. Councilor Jordan explained that they had been trying to get a balance of the people with the most involvement on the Lake Grove Village Plan and knowledge from both sides of the issue. She commented that the City has invested over $900,000 in the Lake Grove planning process and the property owners still had no idea of where the line would be drawn. She agreed that they needed to keep moving on this project. She held that the recommended team would do a good job. Mr. Egner indicated to Council President Hennagin that he had not been looking for input from the Council on the individual Committee members, but rather for a nod of heads to come back at the September 21 meeting with the contract and a list of Committee members. Councilor Vizzini summarized the Council's comments as supportive of adding sufficient money to get the entire body of work done. He reiterated that the two end products that represented success to him were a reasonable and accur:.: description of the corridor for property owners City Council Regular Meeting Minutes Page 12 cf 16 September 7, 2010 (and which honored the goals and policies of the plan) and consensus from the broader Lake Oswego community that was investing in this plan. Councilor Tierney concurred with Councilor Vizzini. He commented that he did not think that they had enough public relations and energy behind this project to keep it moving forward, as the energy has dissipated over time. He indicated that he would support the additional money for a scope of work to move the project to the next step. 7.4 Financial Review as o< .sune 30, 2010 Council President Hennagin ✓ited the Budget Committee members present to come forward to the table: Jeff Gudman, Ron :smith, and Kent Studebaker. Ms. Euler indicated that staff had only preliminary numbers for this review because the audit was still underway. They would have final numbers after the auditors issued their report. She noted the sources of the $.9 million that the General Fund was returning to its fund balance and the importance of evaluating surpluses and deficiencies in balancing a budget (pp.125-126). She discussed the City's revenue from property taxes, both current and delinquent (p.126). She noted that the budget revenues overall were $500,000 below the budget projection due to reduced revenues in other City fees. She indicated that reduced expenditures in personal services and materials and services readily balanced that shortfall. She pointed out that staff had used very conservative numbers in the budget for the franchise fees but the silver lining was that PGE, NW Natural Gas, and Comcast were all reporting increases in retail sales, which meant more franchise fee revenue. She mentioned the motor vehicle fees and street maintenance fee revenues (p.127). She commented that she was thankful that the budget had had a bit of a cushion in it, given the vacation and other accruals that they needed to take into account at the end of the year. Ms. Euler confirmed to Councilor Tierney that the transfers from other funds to the general fund to pay for administrative services charged to those funds by the general fund comprised a large part of the other financing sources. She indicated that the only other financing source she could think of would be bonds. She agreed with the Councilor that there should be a balance of transfers citywide. Councilor Tierney asked how they got so far off on debt service (57%). Ms. Euler explained that the line of credit interest had been budgeted high at 4%. However, the most recent renewal came in at under 2%. Councilor Tierney asked why the capital outlays across all funds (excluding LOIS and the water project) were substantially below budget. He wondered whether cheaper projects or not done projects were the reason. Ms. Euler indicated that there was a variety of reasons, including delayed projects and project funding coming in different from anticipated. She said that she could e-mail Councilor Tierney a detailed list of the projects that might have caused the savings. She gave an example of a project for which they budgeted a capital outlay of $980,000 in federal stimulus funds as cash, only to have the $900,000 come in as in kind. Councilor Tierney expressed his concern that the Council has budgeted for infrastructure capital improvements for two years and the improvements were not getting done. He noted that taking the $900,000 out still left $200,000, on which he would like some detail. Councilor Vizzini suggested adding to the report a separate capital project summary giving the status of these projects. Councilor Olson concurred that the Council needed a Capital Improvement Plan financial report. Ms. Euler indicated that she and her staff were working on the report, per Council's earlier request, and testing it internally to make sure that it had the right numbers and would be useful to the Council. Councilor Olson pointed out that Portland billed the City less on wastewater because the flow volumes to the wastewater treatment plant were significantly lower than in previous years (p.126). City Council Regular Meeting Minutes Page 13 of 16 September 7, 2010 Ms. Euler indicated that she would have to get the answer from other staff members on why that was. She pointed out that her wording specified 'reported,' and not 'actual' flows. Councilor Olson asked what the revenue line item in both the water fund and the wastewater fund (p. 135, 136) called 'licenses and fees' was, given that it had no budget number. Ms. Euler explained that staff sometimes worked for other utilities, and this represented those charges. She indicated that it was similar to transfers, but transfers were usually based on estimates and allocations, whiie these items represented actual hours worked on a project. C,�ugcilor Olson commented that, while she liked the report format very she would appreciate a cover sheet that provided citywide totals. Ms. Euler indicated that staff has begun creating those summary reports for the new year. Councilor Jordan argued that the Council needed to understand why the reported figures for capital projects were different from the budgeted numbers. Councilor Tierney concurred that the why was important. Councilor Tierney discussed the question of whether it was good to have a budget surplus at the end of the year or not. He indicated that he thought that there was a 'magic' amount in there. He pointed out that they could get too conservative and have an unnecessary flexibility and tax rates slightly higher than they needed to be. He observed that the City enjoyed a favorable surplus gained over many years, but he thought that there could be more of a balance with a tighter budget. He commented that it was also important not to hold staff responsible to come in with a surplus every year, especially when the year started out with a tight budget. He recalled the long Budget Committee discussion regarding the reduction in personal services, which he thought could have gone higher than 1 %. He indicated that he was not afraid to overspend slightly some place if they concurred that there was a very tight budget going into the year. He conjectured that, if they did not collect the revenue in a given year from raising the assessment to the full 3%, then the Council could take it from contingency and manage the budget going forward. Councilor Vizzini asked to expand Councilor Olson's request for a summary of the Citywide totals to include a break down of expenditures in the major objective categories. He suggested tracking the workload measures on an annual basis along with the dollars, as opposed to on a monthly or quarterly basis. Council President Hennagin invited the Budget Committee members to ask questions. Mr. Smith asked what impact the $6.7 million surplus had on the 2010/11 budget. He wondered whether Ms. Euler needed to do something different based on this information. Ms. Euler clarified that the $6.7 million was citywide, including utilities. She pointed out that the budget was an estimate, which their team still tried to manage responsibly as best they could. She explained that this additional information helped them to evaluate their progress and determine whether their work was going according to plan, based on the underlying assumptions of the plan. Mr. Smith indicated that he would like more clarity on the assumptions made going forward. He recalled that they cut the Community Services Officer and Traffic Engineer positions. He wondered whether this new information would now allow them to reinstate those positions. Ms. Euler mentioned that internally staff has worked on a five-year forecast, which they hoped to use in the next budget season. She commented that they needed to strike a balance between capital projects, positions, people, services, and new items, such as saving for major equipment and vehicle replacements. Mr. McIntyre confirmed to Mr. Smith that post -audit they would know the exact amount in the City's bank account. Mr. Smith suggested re -visiting priorities to see if funds were available for things cut during the original budget Mr. Gud;nan suggested that the Council consider exploring the possibility of converting LORA's floating rate debt to a fixed rate debt with :-ates a: these historic lows (p.144). He pointed out that City Council Regular Meeting Minutes Page 14 of 16 September 7, 2010 with the WEB building debt budgeted at -3% but -coming in at 2% for the first quarter (p.129), there - - - was money left on the table that could be used for other services. He advocated for a consolidated summary showing the transfers as revenues and expenses and for a capital expenditure summary, in support of Councilors Olson, Tierney, and Vizzini. Mr. Studebaker asked whether the Budget Committee should expect to see a surplus in personal services and materials and services in the next budget cycle, given that the figures were substantially lower in the actual than in the budget. Ms. Euler commented that some of that was real art, and she wanted to reserve judgment for °ew more months. She indicated that she could not point to reasons why the actuals were lower :; s:in the budget, but she intended to discuss the question with staff. Mr. Studebaker commented Knat he would appreciate her finding out why because it could significantly affect how they budgeted next time. Councilor Olson observed that the City budgeted every position as filled 100% of the time, which they all knew did not happen. She recalled that that was why they budgeted a 1 % reduction in the personal service budget last year, which she agreed could have been higher. Councilor Vizzini suggested looking first to the salary savings gained through turnover, such as when a lower salaried new person replaced a higher salaried senior staff person, to determine the reason for the difference. Mr. McIntyre observed that Lake Oswego was the little city that loved to think big and did everything in a robust way. He noted that Lake Oswego and Portland were the only two full service cities in the Metro area. He commented that the complexity in budgeting made it challenging to be the management team that the Council expected. He described the decision making process as they went along as thoughtful and ardent. He pointed out that budgeting was as much science as it was art in trying to find the perfect wedge that was satisfactory to both the public and the decision makers. He commented that, while the City did well on budgeting for utilities and the general fund, it did not do well on budgeting for capital projects. He indicated that he has made a conscious effort to get general fund money for capital projects because it was an area that was seriously lacking, as the City facilities demonstrated. He acknowledged that staff did not present the workload measures that it should have. He indicated that they would do so in the future. He pointed out that each year they all got better at the budget process. He thanked Ms. Euler and her budget team for their hard work in seeking to understand the budget and knowing how the numbers moved and what the impacts were. He reiterated that the City budget was very complex. INFORMATION FROM THE COUNCIL 8.1 Councilor Information Councilor Moncrieff reported that Youth Councilor Ben Silbert was on his way to Northwestern University to study economics. She wished him well. 8.2 Reports of Council Committees, Organizational Committees, and Intergovernmental Committees Councilor Jordan reported on a meeting that she and Councilor Olson attended last week organized by Clackamas County with regard to high-speed rail and ODOT's current plans to attract federal money proposed for those types of projects. She asked to put on the September 14 agenda a discussion of the letter that Clackamas County was drafting, which all city organizations impacted by ODOT's current rail plan would sign. She indicated that the concern was that ODOT was looking at only one of two items that the State should be looking at, and it was not looking at it with a good le^s. She mentioned a suggestion made at the meeting to revive the TooTco Cauc 2 in .vhich al! the cities affected by ODOT's City Council Regular Meeting Minutes Paye 15 of 16 September 7, 2010 proposal to stop the train service between Eugene and Portland had rallied around the service and convinced the legislature to continue the train service. She spoke of possibly taking rail out of ODOT and putting it with a consultant who did not have the same connections to the projects done as ODOT staff did. 9. REPORTS OF OFFICERS 9.1 City Manager 9.1.1 Review of G,l!ncil Schedule Mr. McIntyre indicated to Councilor Jordan that he would make room on the September 14 meeting to discuss the Clackamas County letter regarding high-speed rail. Th Council agreed by consensus with Councilor Olson's suggestion that the Council take two weeks off at Christmas. Councilor Jordan suggested holding the second regular business meeting on December 14 for the public hearing and construction contract award. Mr. McIntyre confirmed to Councilor Olson that the November 9 special meeting on sensitive lands was a study session. He clarified that the Code audit item on October 26 was an update and report on the funding source. 9.1.2 Review of Council Digest Mr. McIntyre explained that this new agenda item was a time for Council members to ask questions about items in the Council Digest or to suggest putting Digest topics on the agenda. 9.2 City Attorney 10. EXECUTIVE SESSION Council President Hennagin recessed the meeting to Executive Session at 10:05 p.m. pursuant to ORS 192.660 (2) (e) to conduct deliberations with persons designated to negotiate real property transactions. Mr. Powell reviewed the Executive Session parameters. 11. RETURN TO OPEN SESSION Council President Hennagin reconvened the meeting at 10:25 p.m. 12. ADJOURNMENT Council President Hennagin adjourned the meeting at 10:25 p.m. Respectfully submitted, WM -9 1 Robyn - City .d APPROVED BY THE CITY COUNCIL: Hoffman, City Council Regular Meeting Minutes Page 16 of 16 September 7, 2010