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HomeMy WebLinkAboutAgenda Item - 2002-02-05 - Number 4.3 - 4.3 02/05/02 CITY OF LAKE OSWEGO AGENDA REPORT SUMMARY MEETING DATE: February 5, 2002 SUBJECT: Approval of Minutes from: 1. December 10, 2001, information session 2. December 18, 2001, morning meeting 3. December 18, 2001, special meeting with TAB 4. January 8, 2002, special morning meeting 5. January 8, 2002, special meeting 6. January 15, 2002, special meeting RECOMMENDED MOTION: Approve minutes as written (or as corrected if Council adds corrections to the motion) EST. FISCAL ATTACHMENTS: NOTICED (Date): IMPACT: Minutes from: • December 10, 2001, information session • December 18, 2001, morning STAFF COST: $ meeting • December 18, 2001, special Ordinance no.: BUDGETED: meeting with TAB Y N • January 8, 2002, special Resolution no.: morning meeting FUNDING SOURCE: • January 8, 2002, special meeting Previous Council • January 15, 2002, special consideration: meeting CITY M AGER S( ate col 0 2, signoff/ N:\Robyn\report minutes.doc 4.3. 1 02/05/02 MINUTES OF DECEMBER 10, 2001 INFORMATION SESSION 3 i 3 ; /41k �� CITY COUNCIL SPECIAL MEETING MINUTES '�^� December 10,2001 Mayor Judie Hammerstad called the City Council information session to order at 4:10 p.m. on December 10, 2001, at the Main Fire Station, 300 B Avenue. Present: Mayor Hammerstad, Councilors Rohde, Schoen, Turchi and Hoffman. Councilors Graham and McPeak were excused. Staff Present: David Powell, City Attorney; Jane McGarvin, Deputy City Recorder; Bob Kincaid, Chief of Staff; Janice Deardorff, Human Resources Director; Richard Seals, Financial Planning Manager; Chris Jordan, Assistant City Manager 3. INFORMATION SERSION 3.1 Discussion of subjects for January Council Retreat Mayor Hammerstad commented that many of the matters mentioned by Mr. Schmitz were not necessarily the source of major goals, although the Council would handle them during the course of the year. She mentioned sending out letters to the Advisory Committees asking for their year end reports and goals and informing them of their scheduled time with the Council on Saturday morning. She indicated that they would invite LONAC also. Councilor Rohde suggested inviting the Chamber. Mayor Hammerstad asked if the Council wanted an open invitation to civic organizations. She suggested scheduling those who wanted to come after the advisory committees and allowing half an hour. The Council agreed by consensus. Mayor Hammerstad suggested spending Friday on a review and self-evaluation of the Council and its Year 2000 goals, focusing on what they accomplished, why they did not accomplish other things and where they could improve in both substance and process. She noted that Joe Hertzberg would facilitate the meeting. David Powell, City Attorney, indicated to Councilor Rohde that the periodic review of the Comprehensive Plan would begin in 2002. Councilor Rohde spoke to reversing the review process to start with the Council identifying its areas of concern, and then sending their concerns first to the Task Force and the Planning Commission instead of receiving a final recommendation from the Planning Commission and being on the tail end of the process. Mayor Hammerstad suggested scheduling this issue for discussion at a Monday information session. Councilor Rohde asked for discussion of the Youth Council goals and their projects. Mayor Hammerstad mentioned going through the visioning exercise again to see if anything changed. Councilor Schoen requested a printout of last year's exercise. Councilor Hoffman discussed his interest in determining how much money was actually available in the community for ballot measures to fund programs, both in the short-term and in the long-term. He suggested having an analysis of the level of debt of the average Lake Oswego household (past and present) in order to determine the ability of the community to absorb more ballot measures for funding programs. He spoke of determining the long-term needs, resources and the political factors. Councilor Hoffman asked for a list of all the Capital Improvement Plan(CIP) projects, especially those that they had choices about. He asked for a discussion of prioritizing projects. He questioned if they could find other funding sources for any CIP projects, which they have paid for using dedicated funds. He indicated to Councilor Rohde that an examination of the Public Facilities Plan would be part of the discussion. Mayor Hammerstad concurred that this was an issue under the `Needs for the next 20-30 years' category. City Council Information Session Minutes Page 1 of 12 December 10, 2001 3 3 Councilor Rohde indicated to Councilor Hoffman that the previous Council rejected a community forest program. Councilor Hoffman reported on his Internet research on tree codes, which existed all over the country. He asked for discussion of a community forest program, as there might be other options to their tree code. Mayor Hammerstad suggested having a brief presentation on the issue with future discussion within a goals context. Councilor Hoffman mentioned an article he read in a New Urbanism newsletter, which discussed new zoning codes that allowed `flex-housing' in neighborhoods and neighborhood commercial uses. He spoke of the `orange juice and Frisbee' test: people should be able to live in a neighborhood in which a 12-year old kid could ride his/her bicycle to a store to pick up a quart of orange juice on a Sunday morning, and in which the residents could walk to the park to play Frisbee. Councilor Hoffman asked for discussion of allowing more flexibility in the Zoning Code, such as allowing non-traditional uses in a zone (i.e., multi-family housing in an R-10 zone). He commented that it might not happen for 20 years but there was a lot of information coming out about how to adapt New Urbanism concepts to existing neighborhoods. Councilor Rohde asked for a discussion on affordable housing. Councilor Hoffman pointed out that affordable housing could be combined with a New Urbanism discussion. Councilor Schoen mentioned looking at what services the City might have to discontinue, given the revenue projections. Chris Jordan,Assistant City Manager, indicated to Councilor Turchi that citizens would pay on the 20-year street maintenance bond until 2017. Mayor Hammerstad mentioned Councilor McPeak's opinion that the Council should start budgeting like adults. Councilor Turchi asked to discuss the School District's likely financial position next year and what the City's role might be with respect to the District. He mentioned the possibility that a large contingent of people might come to the Council in mid-February or March to ask the Council to save the School District. Mayor Hammerstad observed that the two aspects of that issue—philosophical and practical— might be different discussions. Councilor Turchi concurred. He described this as a situation in which they had some flexibility and projected needs that they needed to discuss at the same time. Mayor Hammerstad mentioned the need to consider the different missions of the two agencies. Councilor Turchi indicated that the School Board held its goal setting session in August. Mayor Hammerstad noted the list of things under land use, including revisiting the Council goal, neighborhood livability in a community context, as well as discussing sustainability. Other land use topics mentioned included annexations and island annexations. Mayor Hammerstad mentioned her expectation that a result of the goal setting session would be the Council having a common understanding of their short-term goals. She spoke of setting a couple of long-term goals this year. Councilor Rohde asked about getting a jumpstart on the 2003 legislative session by developing a legislative agenda. He recalled that last year they did their goal setting after the legislative session started, and he felt that they had reacted to things. Mayor Hammerstad concurred that it had felt like they were always behind but observed that at this point they had little information available and could end up spending time on something that they did not need to work on. She suggested a future discussion on questions to ask the candidates in September. Councilor Hoffman suggested that Mr. Powell make a presentation to the Council in July on the 2002 ballot measures, after he attended the Oregon City Attorneys Association meeting. Mr. Powell mentioned revisiting the Council's legislative objectives, noting that they had been too late on the photo radar issue. 3.2 Employee Assisted Housing City Council Information Session Minutes Page 2 of 12 December 10, 2001 Bob Kincaid, Chief of Staff,recalled that Councilor Rohde asked staff to look into an employee assisted housing program. He said that he had been well into his research on it when the Oregonian came out with an article about Fannie Mae putting together employer assisted housing program. He reported that he met with Fannie Mae representatives who designed a program for Lake Oswego. He introduced Sue Krake, Senior Deputy of Fannie Mae Partnership Office and Jane Leo,Portland Metropolitan Area Realtors. Mr. Kincaid recalled Councilor Turchi's query on how many life-safety employees lived within the Lake Oswego city limits. He presented a map showing where all full-time City employees lived in the region. He said that seven police officers and seven fire fighters lived within the City's urban services boundary with an additional 22 employees living in and around the Lake Oswego area. He noted that the regular work force of 285 employees were scattered from Sandy to Forest Grove and from Castle Rock, WA,to Salem. Councilor Hoffman summarized the percentages as 15%police, 15% fire and 10%other employees living within the Lake Oswego USB. Mr. Kincaid indicated that he did not know how that compared with other jurisdictions. Janice Deardorff,Human Resources Director, said that cities did not necessarily routinely keep those statistics. She recalled that Portland used to have a residency requirement. Councilor Turchi asked if those living around Lake Oswego were older employees who purchased homes when homes were more affordable in Lake Oswego. Mr. Kincaid said that he did not know, pointing out that the employee might rent rather than own a home. Ms. Deardorff indicated that it was a mix of employees from older employees to mid-range employees to new employees. Ms. Krake gave a presentation using overhead graphics. She described three pieces to setting up a program to help employees live close within the city: the nuts and bolts of the program, how to measure what people could afford, and did the housing exist for them to purchase. She emphasized that the discussion was predicated on everyone acknowledging the desire to have City employees live near or within the city. Ms. Krake commented that she has worked with employer-assisted housing in the public and private sectors for six years. She observed that the programs were custom-made and designed to meet the needs of the employer. She said that this conversation was an opportunity to discuss a general framework that could be customized to Lake Oswego's situation. Ms. Krake reviewed five ways in which employers could work with employees: direct assistance through a grant or a loan, education on purchasing a home and taking out a home loan, matching the employee's savings, and loan guarantees working with a lender partner. She noted that each option had different advantages and disadvantages in meeting both the employer and the employee's goals (keeping employees close in(employer) and buying a home (employee)). Ms. Krake discussed the affordability element. She mentioned that Mr. Kincaid insisted that a range of salaries be looked at in order to get a realistic view. She went through an example of what an employee at the administrative secretary grade level could afford. At an average salary of$2,909 per month(62%of the metro area median income), this employee could afford a $107,950 home (97% or$104,700 loan, 3% or$3,200 down payment and $960 per month house payment, including taxes and insurance). She noted that the maximum other debt that this employee could carry was $144 per month(including car payment and credit cards). She indicated that the cost to the employee to complete the transaction (down payment and closing costs) was $8,205. The handout included three other positions. Councilor Rohde asked if Ms. Krake used a percentage formula to calculate what an employee could afford to pay. He observed that people put a greater percentage of their income towards housing than was typically recommended. Ms. Krake explained that 15 years ago, the qualification structure for a loan used to be 25% of the income for the house payment and 33% City Council Information Session Minutes Page 3 of 12 December 10, 2001 3J maximum debt; today those percentages have shifted to 33% and 38%, which was what she used in calculating these figures. Ms. Krake concurred with Ms. Deardorff that a person's debt load usually surpassed the $144 per month remaining after a house payment. She mentioned educating people on how to reduce their debt; it could take a year or so to pay off bills prepatory to buying a home. Ms. Krake clarified to Councilor Hoffman that the minimum requirement for Fannie Mae was that the buyers themselves needed to provide 3% of the home purchase price. She explained that in her example, 3% of the purchase price ($3,239) subtracted from $8,205 left a balance of $4,966. She confirmed that$4,000 to $5,000 was the typical amount paid by the employer. Ms. Krake acknowledged Councilor Hoffman's point about finding homes in Lake Oswego within these price ranges. She said that the next step after identifying the employees that the City wanted to bring into the city was identifying how many housing units existed in the city that were affordable. Ms. Leo reviewed the data(plotted on maps) pulled from the realtor's multiple listing service listing homes with Lake Oswego addresses, which fell within the various price ranges. She noted that the majority of the 100 housing units falling in the $0 to $175,000 range were in Mountain Park and the Lake Grove area(primarily condominiums under$100,000). She noted the broader spread across the city of the 30 units falling within the $176,000 to $200,000 price range (Lake Grove, Jean Road), and of the 39 units falling within the $201,000 to $250,000 price range. She concluded that Lake Oswego did have a healthy housing stock on the market in a broad price range. Ms. Krake pointed out that first time homebuyers usually did not buy the "American Dream" house with a white picket fence;they bought condominiums, row houses or single-family fixer uppers on a small lot. She confirmed to Ms. Deardorff that their example figures were based on the salary of the employee alone as opposed to a dual income. Mr. Kincaid indicated to Mayor Hammerstad that he was not aware that the City has surveyed its safety employees about their desire to live in Lake Oswego. Ms. Deardorff mentioned that she has heard in the past that many safety employees did not want to reside in the town in which they worked because they did not want their families targeted or ostracized because of their work. She mentioned that she has not asked that question in today's terms, so she did not know if it was still true. She commented that she had not heard that from fire fighters. Ms. Krake said that she heard both stories. She recalled a City of Portland police officer employer-assisted housing program that included the ability to finance security or other housing modifications in order to increase the officers' comfort levels with living in the city. Councilor Turchi wondered whether the large number of employees lived in West Linn in order to be close to the city but without live in the city itself Councilor Turchi noted that the figures showed that a fire fighter, making 88%of the average municipal income in the metro area,was eligible to purchase a$151,000 home, which meant that he/she would have a hard time finding a home in Lake Oswego. Ms. Krake indicated that that was true all over the metro area, which was why many municipalities were trying to figure out how to give employees a choice between buying a home versus renting. Ms. Leo spoke to the Council remembering during its goal setting that anything the City did could affect the price of housing, especially in terms of making housing affordable. She noted that Lake Oswego and West Linn led the way in terms of the most expensive housing on the market. She indicated that a family of four, at a median income of$5,409 per month, fell approximately $600 short of being able to buy a median-priced house. She described the $100,000 units as a place to start. Ms. Leo indicated to Councilor Turchi that she was not saying that a Council decision to subsidize a down payment for a home might increase the cost of homes, although that depended City Council Information Session Minutes Page 4 of 12 December 10, 2001 36 on the funding sources. She used an example of planting a new 4-inch caliper tree versus replacing a 4-inch caliper tree: it cost$400 to purchase and plant a new tree but it cost $400 plus a permit fee and other costs to replace the tree. Ms. Leo mentioned the Portland ordinance requiring developers to plant one caliper inch of tree for every 1,000 square feet of new construction, which translated to $500 for 5 caliper inches of trees on a 5,000 square foot lot and an additional fee tacked on to the housing price. She commented that they saw many people coming to the table with all the cash they had and the extra fee was simply too much. Councilor Hoffman asked how the $4,000 to $5,000 at closing helped a homebuyer. Ms. Krake pointed out that most people's rent payments were at or above a mortgage payment. She indicated that the biggest barrier was accumulating the cash to get into the transaction in the first place. She said that the employer, by providing assistance with the closing costs, really made a difference in people's ability to buy a home. Councilor Rohde commented that the City could borrow money at low rates. He asked if there were programs in which the agency borrowed the money, loaned it to the employee and passed on the low interest rates. Ms. Krake said that there were programs using loans instead of grants. She discussed the impact dynamic of loan interest, which added on to the house payment amount and ate away at the additional debt a person could carry. Mayor Hammerstad asked if there was a way in an employer-assisted program to prevent the speculative selling of property that someone purchased at a low price but which had a value twice the purchase price. She asked if there were programs where the agency recouped the down payment at the time the employee sold the home and realized the profit. Ms. Krake said that there were programs structured to recoup the down payment at any transfer of ownership. She noted that an employee leaving the City would also trigger a repayment. Councilor Hoffman expressed concern that the draft program report used an official seal, making it look like it was a program in effect. He asked either to remove the seal or to mark the report as `draft.' Ms. Krake reviewed the draft framework program. She noted the draft eligibility requirements: • Permanent City employee for a minimum of one continuous year before application; • An agreed upon level of evaluation in their last written performance evaluation; • The City could chose to make the program available in less than a year to safety personnel; • The City could limit the program to certain job grades or use whatever criteria it wanted. Ms. Krake reviewed the draft program requirements: • A minimum of 3% of the sale price from the borrower's own funds; • The home must be the principal residence of the employee during the term of the program; • The home must be located within the city boundaries; • Participating employees must attend and complete a class on buying and home ownership through an approved education buyer(this protected the City's investment through proper management of the home); • Eligible employees must be able to qualify for a mortgage through a financial institution (leaving the determination of mortgage qualifications to the lenders); • The purchase price could not exceed 120% of the median home sales price for the Lake Oswego area(average price $300,071 per Ms. Leo). Ms. Krake suggested a variety of elements to think about when defining the program (draft): City Council Information Session Minutes Page 5 of 12 December 10, 2001 3 7 • A loan would be up to 5%of the purchase price for a term of five years; • A cap on the amount provided by the agency; • The money provided must be used for the transaction costs to get into the home; • Loan proceeds could be used to cover the expense of an energy rating; • The principal and interest due on the loan would be forgiven(or a piece of it) if the employee maintained or exceeded his/her performance level rating (although it remained as taxable income)' • The principal was considered income; • The loan was secured against the property in order to allow the agency the option of recouping the money if someone sold the home or refinanced it; • The remaining portion of the loan would be paid in full upon sale of the home or the employee leaving the agency's employment; • The employee must sign and abide by an agreement codifying the details of the program; • The loan could be paid in full at any time. Mr. Jordan indicated to Councilor Rohde that the City could not do much better than most people in terms of interest rates. The Council discussed interest rates. Mayor Hammerstad commented that the next step for the Council to think about was budgeting money for a program during the budget cycle. Ms. Krake noted the cost benefit analysis included in the report. She mentioned that under the model used, the program would cost the City $10,000 over ten years. She pointed out the option for the Council to budget a certain amount each year, and when that money was gone, the program waited until the next year. Ms. Deardorff asked if Ms. Krake has seen collective bargaining groups ask for this benefit. Ms. Krake said that she has not seen this benefit attached to a contract, although agencies have offered it to employees, such as the Portland School District and the University of Portland. Councilor Hoffman noted that on the average, over 10 years, the cost was $6,000 per the employee per year, factoring in a decreasing turnover rate due to age. Ms. Krake indicated that she based the decreasing turnover rate on the historical data she had available, which showed a rate of 1.5%to 5%. Councilor Rohde asked how much the Council should budget for the program. Mr. Kincaid said that it depended on how big a program the Council wanted and how much their employees would participate. He mentioned the option of limiting the program to the first seven or eight employees in the first year or limiting the amount of money allocated to it. He commented that, over time, the Council might want to adjust the parameters and see how successful the program was. Councilor Hoffman spoke to articulating the arguments in favor of doing the program first. He mentioned Councilor Rohde's comment that the police officers should live in the city, as they used to. He summarized Ms. Deardorff s comment as keeping the officers in the city might not be the primary reason why public employers had the program because it might not be as much a benefit to the officers as they thought. Councilor Hoffman said that it sounded like a good idea but he was nervous about it because he did not know the arguments in favor of it, especially for a municipality. He asked which employees were good to have live in the city. Councilor Hoffman asked for comparables with other cities. He asked if there was a way to find out from employees whether they were interested in such a program but without raising City Council Information Session Minutes Page 6 of 12 December 10, 2001 3 8 expectations. He summarized his questions as would employees take advantage of the program and could employees articulate a reason why the community benefited from them living in the community. Councilor Hoffman clarified to the Mayor that he was interested in anecdotal information gained by Ms. Deardorff, as opposed to a survey of employees. He suggested asking the managers if they thought employees would be interested in the program. He stated that he also needed to know the arguments against the program before he would feel comfortable with it. Councilor Schoen said that he did not want to float something among the employees without solid information. He spoke to getting more information before proceeding too far. Ms. Deardorff commented that, given that this program targeted first-time homebuyers, they should ask how many employees already owned their own homes. She observed that they might be talking about a small number of people. Mr. Kincaid indicated that he had no idea how many employees owned their own home. Councilor Hoffman spoke of the different levels to articulate in a white paper on why this was a good idea. He observed that a consideration from an organizational standpoint might be trying to attract younger people with their lower salaries. He posed the questions of did it benefit the organization to have employees live in the city, and did it benefit the community to have employees in the city. Mayor Hammerstad observed that Portland and other cities must have written rationales for their programs. Ms. Deardorff recalled that,when the program came out, Portland's rationale had been to try to get people to move into the North Portland and Northeast Portland neighborhoods, which were traditionally more crime-ridden; the premise was that the presence of more police officers in those communities would decrease crime and support the overall development and financial stability of those areas. Ms. Krake commented that it had also served as a recruitment tool. Ms. Leo pointed out that Portland's program was still limited to specific geographical areas and remained a healthy program. She indicated that Portland was willing to carry $100,000 as a silent second in order to get police officers into those areas. She commented that first year cops in Portland, who made less than the median for one person, could buy into those neighborhoods with$200,000. Ms. Leo indicated that the AFL-CIO program (fire fighters)was broader, covering any Portland address in an attempt to attract and retain employees. She asked if the Council's intention was to target the first-time homebuyer or to attract its employees to live within the city limits, which would not limit the program to first-time homebuyers. Councilor Schoen recalled that the original premise raised by Councilor Rohde had been a program for public safety personnel. Ms. Krake pointed out that, in the event of a disaster, the first line of defense relied heavily on maintenance workers as well as police and fire. Councilor Turchi commented that what they were looking for were people who would be in the city and available 24 hours a day; therefore, first-time homeowner criteria did not matter. Councilor Hoffman indicated that he was not certain that that was the only reason justifying a municipality having more employees living in its own neighborhoods. Mayor Hammerstad commented that it would be helpful to look at other communities of similar size and see if they had successful programs. Councilor Hoffman spoke to looking at the demographics also. Councilor Hoffman asked staff if it was possible to look for a placeholder for some amount to start the process. He mentioned not committing to anything other than just looking at an amount and investigating their options, as he might want to spend the money on something else. Councilor Schoen observed that their choices would come out in their priorities. City Council Information Session Minutes Page 7 of 12 December 10, 2001 3;i Mayor Hammerstad commented that the program did have some larger societal values in terms of having people live close to their work, which raised considerations of commuting and travel time. She reiterated her interest in seeing what other communities have done. She said that she did not know whether she would vote for or against an employer-assisted housing program but she did want to know more about it. Mayor Hammerstad mentioned that it had less financial cost in the long term than she would have thought. She held that having 25 employees moving into the community for a total cost of $60,000 had considerable benefit. She indicated that the Council would revisit the issue when more information became available. 3.3 Review: Update of Master Fees and Charges Booklet Richard Seals, Financial Planning Manager, confirmed to Mayor Hammerstad that the master fees and charges booklet update was scheduled for the Council's December 19 meeting. He noted that the effective date of the updated fees was in January 2002. He described the booklet as a consolidation of all the City fees and charges from utility rates to developer SDCs, etc. He mentioned that the City's total fee revenue was $18 million a year or one-third of the operating revenues for the City budget. Mr. Seals indicated that roughly $10 million of the $18 million came from the utility rate revenues. He stated that the proposed update contained no significant changes for 2002; any changes were mostly inflationary in nature. He noted the increase in the main surge fee to $8 to cover software and an increase in the golf fees from 75 cents to $1.00 per 9-hole round. Mayor Hammerstad asked why staff did not round the golf fees of$8.75 and $15.25 to $9 and $16. Mr. Seals said that he had wondered the same thing but did not know why the Golf Course Manager did not round the fees after his market analysis. Mayor Hammerstad pointed out that the rates were so low that she could not imagine anyone objecting to $9 and $16 with $10 on Friday, Saturdays and some holidays. Mr. Seals mentioned that he knew that the rates came from the Parks and Recreation Advisory Board. Mayor Hammerstad confirmed to Mr. Jordan that she was recommending rounding the fees to $9 and $16, with$10 for the price of Saturday and Sunday and keeping the $17 where it was. Councilor Hoffman recounted a comment he heard from a remodeler that the City was lacking timely permit processing, and that the remodeler would support increasing permit fees if the City added staff. He described the problem as the City not having enough inspectors. He indicated that he knew from personal experience that it took a long time to get building inspections. Councilor Graham indicated that she has heard similar stories. Mr. Jordan observed that if the City was not providing satisfactory service, even with the increases,then staff needed to do something to improve that service. Councilor Hoffman spoke to asking the builders and remodelers if the City was getting things through the process so that they could get their projects done; if not, then would they be willing to pay an extra 10%for the City to hire more staff. Mr. Jordan mentioned the staff shortage in the Building Department. He expressed his hope that when they got back up to full staff,they would no longer hear those kinds of complaints; however, if they continued, then they needed to do something about it. Councilor Hoffman pointed out that the homeowners in Lake Oswego were more concerned about time than money. Mayor Hammerstad recalled that improved service was one of Mr. Schmitz's goals, and consequently, staff conducted a survey of people interacting with the Planning Department, which might give Mr. Jordan more than anecdotal information. Ms. Deardorff noted that the City had a new Community Development Director and Building Official, both of whom were looking at the City's delivery of service in order to determine if they were providing services at the appropriate level. She spoke to the Council not hastily deciding City Council Information Session Minutes Page 8 of 12 December 10, 2001 4 0 that this was a `people' issue when it might be a `setting of the standards and follow-through' issue. She said that she would inform Mr. Schmitz and Mr. Lashbrook of this concern during her Friday meeting with them. Councilor Schoen asked why staff did not raise the athletic field user charges (page 19). Mr. Jordan said that there has been serious consideration on raising those charges. He explained that staff did not want to raise the fees prematurely and chose to wait until after they brought back the information to Council,which Council requested a month and a half ago, and Council gave them the guidelines. Councilor Schoen asked if the Council could make an interim increase of fees. He discussed his concern with the athletic field user charges, which he argued the Council needed to look at realistically. He questioned whether the provider organizations would choose to donate equivalent funds to support field maintenance and equipment purchases in lieu of a per player per season fee. He held that the organizations had additional funds, which should be part of the original fee system. Mr. Jordan concurred with Mr. Seals that the Council could increase fees at any time; this was an annual booklet,which the Council could change at any time. He described the Council's two options: an immediate interim increase and a second increase in a couple of months (following the staff report) or no increase now but a new increase following the staff report. Councilor Schoen mentioned the tournament and special use reservation fees in particular. He held that those uses in particular would have a huge impact on the fields. He acknowledged the argument that the City had a responsibility to provide recreational facilities for all its citizens but argued that the City was not responsible for providing those facilities for non-citizens, especially at a nominal fee. He spoke to looking at the big picture, noting the huge deficit in field maintenance (which was complicated by the artificial turf situation). Councilor Schoen said that he was not suggesting charging the field users 100% of the costs but he did think that the City charged them only a very small percentage of its costs. He spoke to taking a tough look at the issue in light of the Council's fiduciary responsibility, even though it would upset the team sports people. Councilor Hoffman mentioned that PRAB and Kim Gilmer were meeting this Wednesday with representatives of the non-profit organizations providing recreational opportunities to kids in Lake Oswego in order to discuss the delivery of recreation services in Lake Oswego. He pointed out to Councilor Schoen that the City had some basic maintenance costs for field upkeep, regardless of who used the fields, because grass grew, etc. He recalled that staff was working on obtaining those numbers at the Council's request. Councilor Hoffman spoke to distinguishing between organized usage and unorganized usage and developing the rationale for increasing the fees. Councilor Schoen observed that this was not a simple issue but reiterated that the City needed to look at the consequences of the increased usage. Mr. Jordan mentioned receiving some new charts recently from Parks & Recreation showing field usage, which indicated that staff was in the process of obtaining the requested information. He observed that right now was a good time to wait for a month or two to increase fees because the fields were not in use at this time of year, and the City did not forego any potential revenues. He indicated that staff would have something to the Council in January for discussion. Mr. Jordan suggested addressing Councilor Schoen's concern that people would assume that there were no new increases by adding a footnote to the printed fee, which stated that the Council would review this fee in early 2002 for potential changes. The Council agreed by consensus. Councilor Rohde posed a scenario of going to a hardware store,buying a toilet and installing it in his home. He questioned having to pay a$75 permit fee (page 30). Mayor Hammerstad questioned whether she was supposed to have obtained a permit to replace her dishwasher. City Council Information Session Minutes Page 9 of 12 December 10, 2001 4 i Councilor Hoffman spoke to conducting a useful exercise of reviewing the fees to see if they made sense today. Mr. Powell clarified that the permit fee was for replumbing a home to install additional fixtures, and not for replacing an existing appliance. Mayor Hammerstad suggested adding some clarifying language. Mr. Jordan mentioned that the State Building Code might have a requirement of a plumbing permit in order to do some of this work. The Council discussed the backflow prevention device, which the Mayor held was a most annoying and impractical device. Mr.Jordan said that he would try to get the Council an explanation on why it was required. Councilor Rohde raised the question of the fee for the appeal of a hearing body decision to the Council (page 37). He noted that the City could waive that fee for neighborhood associations but not for any other non-profit organization. He mentioned the possibility that the Bicycle Transportation Alliance might appeal the DRC decision on bike parking at the high schools. He spoke to having the ability to waive the fee for non-profits. Councilor Hoffman expressed concern at setting a precedent, which any kind of organization could cite. Councilor Rohde suggested limiting it to non-profit organizations filed under the state. He pointed out that the fee for appealing a decision on the high school would be enormous. He reiterated that there should be an opportunity to waive the fee for non-profit organizations or to charge a reduced fee. He observed that a complete waiver would make it meaningless. Councilor Schoen commented that he saw no value in waiving an appeal fee for the Alliance. Councilor Hoffman summarized Councilor Rohde's concern as not discouraging non-frivolous appeals by neighbors. Councilor Hoffman noted the statement that the City Manager has waived the fee in the past, asking where that was in the ordinance. Mr.Powell directed the Councilor to Section 1,page 1, which allowed the City Manager to establish a waiver in a particular case or based on past practice. He indicated that the Council could include a blanket category but pointed out that making an appeal too easy (through an extremely low fee or fee waiver)would provide an opportunity for the many non-profits with their varying points of view to bring a multitude of items before the Council. He agreed that they did not want to make an appeal prohibitively expensive so that people could not exercise their rights. Councilor Rohde concurred that it should be an amount that established a seriousness about the appeal but was not so high, as to discourage people completely. He spoke of finding a balance, mentioning$300 as a reasonable amount. Councilor Hoffman mentioned his concern about staffing costs, as appeals involved a significant time commitment from staff He discussed his concern at giving too much discretion to the position of City Manager, as an incumbent could abuse that discretion in encouraging or discouraging appeals based on waiving or not waiving the fee. He indicated to Mayor Hammerstad that giving the discretion to the Council put the Council in a difficult position, especially with regards to quasi-judicial decision, as it allowed the Council to establish who came before it and who did not. Mr. Jordan referenced the language on page one, which described the City Manager's authorization to waive a fee if it met certain criteria and the requirement that he/she inform the Council in writing of the request and his/her decision for comment. Mayor Hammerstad indicated that that language was fine for addressing the concern. Councilor Hoffman concurred but indicated that he found Councilor Rohde's concern legitimate. Mayor Hammerstad suggested waiting to see if the procedure outlined worked in the Bicycle Transportation Alliance's situation; if the Alliance came to the Council saying that it could not pay the fee, the Council could send them to the City Manager to request a waiver. Councilor Rohde concurred. City Council Information Session Minutes Page 10 of 12 December 10, 2001 Mayor Hammerstad discussed her concern with the fees relating to historical preservation (page 36). She spoke to reinstating the two fees crossed out on the schedule. She explained that last year she had not supported the fees because she thought that the law did provide for the City doing these services and the high fee subverted the legislative intent. She indicated that, with more information, she believed that the fee level was appropriate for the service provided. Mr. Powell indicated to Councilor Hoffman that the City charged $1,600 because it required either a hearing based on criteria in the Comprehensive Plan or a waiver process,which was similar to a land use hearing. He mentioned that recent court decisions have established the requirements. Mayor Hammerstad indicated to Councilor Hoffman that they could not charge a huge amount because there had to be a nexus between the fee charged and the cost to provide the service. Mr. Powell mentioned the probability of a due process argument on an extremely high fee. Jane McGarvin,Deputy City Recorder, asked why general service copies were 10 cents at the library and 25 cents everywhere else in the City (pages 10, 15). Mr. Seals recalled that he pointed that out to the library personnel but the librarians felt strongly that they needed to maintain the 10 cents per page charge. He said that Mr. Schmitz raised the same question but decided to let it go this year. Mr. Powell pointed out that people did self-service copies at the library while doing research whereas elsewhere in the City, staff had to retrieve the record in order to make a copy. Mayor Hammerstad questioned whether they should hold the tree code fee increases (page 38) in abeyance until after the Tree Code Task Force did its work. Mr. Seals noted that the increases were purely inflationary. Councilor Hoffman commented that the Task Force would not finish its work until mid-summer. Councilor Hoffman spoke in support of holding off on the fee increases because people would interpret fee increases as the Council having already made up its mind about the tree code. He suggested putting a note that the City held the fees at the 2001 rates, pending the review of the tree code by the Task Force. Mr. Seals mentioned that the utility rates reflected year 2 of the 6-year plan. He indicated to Councilor Hoffman that the City was in good shape and on track with respect to saving money for the lake interceptor project. Councilor Hoffman asked when staff would know if the cost might be higher than the original estimate. He discussed his concern that they charge a slightly higher fee now to accommodate potential increased costs as opposed to charging a significantly higher fee during the project. Mr. Seals said that the latest estimates he heard were between$18 and $25 million;they used $20 million as their design dollar amount for the project. Mr. Jordan said that he has not heard anything more on it either. He noted that staff was trying to accumulate enough money at this time to meet the covenants and to sell bonds. Mayor Hammerstad suggested revisiting the issue at budget time. 3.4 Review: Amendment to the annual budget for fiscal year 2001-02 and making appropriations Mr. Seals confirmed to Mayor Hammerstad that the Council would take formal action on this item at its Tuesday evening meeting. He noted the adjustments to six funds and that the biggest adjustment was in the public safety capital improvement fund to reflect the FEMA grant for the sprinklers in adult foster care. 4. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 6:10 p.m. Respectfully submitted, City Council Information Session Minutes Page 11 of 12 December 10, 2001 4 3 /10.A..1227/1441) 6ne McGarvin Deputy City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Information Session Minutes Page 12 of 12 December 10, 2001 4 4 4.3.2 02/05/02 MINUTES OF DECEMBER 18, 2001 MORNING MEETING 45 46 CITY COUNCIL MORNING MEETING MINUTES / December 18, 2001 4EGON Mayor Judie Hammerstad called the special City Council meeting to order at 7:33 a.m. on December 18, 2001, in the City Council Chambers. Present: Mayor Hammerstad, Councilors Turchi (arrived 8:00 a.m.), Graham, McPeak, Hoffman, Rohde and Schoen(arrived 7:35 a.m.). Staff Present: Doug Schmitz, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Kim Gilmer, Parks & Recreation Director; Richard Seals, Financial Planning Manager; Chip Larouche, Information Technology Manager; Bob Kincaid, Chief of Staff; Tom Tushner, Principal Engineer • Arts Downtown Jean Folwell,Arts Commission Co-Chair, explained that immediately after the Arts Downtown kick-off in June 2001 (coinciding with the Festival of the Arts) the Commission decided to move the kick-off date for Arts Downtown from June 2002 to September 2002. She indicated that they did so in order to preserve the opportunity to have art all summer and to avoid wearing out the City staff and the Arts Commission. She mentioned the opportunity to couple Arts Downtown with a fundraiser. Ms. Folwell pointed out that moving the event to September 2002 took it out of the 2001/02 fiscal year budget, which was where the funds for Arts Downtown 2002 were presently located. She asked the Council to roll over the $25,000 allocated for Arts Downtown 2002 to the 2002/03 budget, so they could have it available in September 2002. Marta Furman, Arts Commission Co-Chair, reviewed the artist selection committee for Arts Downtown 2002. She mentioned that 13 of the Arts Downtown 2001 sculptors resubmitted either their current piece or a new piece; the committee chose another seven new artists for a total of 20 sculptors. She commented that because they used a call for artists (as opposed to an invitation), the show saw a wider range of styles. She indicated that she had the letters ready to send to the sculptors. Councilor Rohde asked if the Council making this decision now was in advance of the Budget Committee's decision-making process. Doug Schmitz, City Manager, confirmed that this money has already been allocated in the budget for this project. Mayor Hammerstad acknowledged Councilor Rohde's point about the Budget Committee and conceded that the Council could not guarantee 100% that the Budget Committee would approve the request. She pointed out that the decision ultimately came back to the Council for final approval. She held that it was 99%probable that the Council would approve carrying the money over. Ms. Folwell confirmed to Councilor Graham that the Arts Commission did have a matching grant from the Tourism Bureau. She said that they would try to use it in this fiscal year to pay for the pedestals Ms. Furman indicated to Councilor McPeak that five of the 13 repeat artists were submitting the same statue that they had submitted in Arts Downtown 2001; the selection committee felt strongly about those 5 pieces and re-selected them again. She said that the other eight artists would submit new pieces. Mayor Hammerstad suggested that the Arts Commission write a letter to the Budget Committee informing it that the Commission presented this proposal to the Council to carry over City Council Morning Meeting Minutes Page 1 of 11 December 18, 2001 47 this money to the next fiscal year for expenditure for the same purpose for which it was allocated. Councilor McPeak referenced the proposed policy for purchasing a sculpture from Arts Downtown using City or Trust fund monies. She mentioned that this draft incorporated the suggestions she received from the Arts Commission and the Public Art Committee. She noted that it still included the additional public process for selecting a piece that the Council discussed. Councilor McPeak noted that Step 1 of the proposal was different from her original draft version. She explained that the Arts Commission thought it important to inform the artists up front of the purchase price limitations for a City purchase, giving them a minimum and a maximum. She said that she did not include a minimum because she saw no need for one. Councilor Rohde asked what affect might the purchase price limitation have on limiting an artist's willingness to participate in the show. Ms. Furman stated that the three artists participating in the discussion had been the strongest proponents of providing a ball park figure to the artists; artists wanted to sell their work and the potential price helped them to decide on the materials. She indicated that she did not think the limitations would discourage the artists from participating. Councilor Hoffman concurred that the answer was 'no', citing the discussion at the Arts Commission meeting that artists mentally decided whether to create a $6,000 or$60,000 sculpture. Councilor Rohde asked if that meant that the public did not get to view a $60,000 sculpture for a year. Councilor McPeak conceded that it might but held that the artist who submitted the $175,000 piece could not have expected the City to purchase it. Ms. Furman indicated that she trusted the level of professionalism exhibited by the selected artists to lead the artists to do the right thing. She observed that 13 out of 19 artists returning indicated support for the City's exhibit. Councilor Graham pointed out that Arts Downtown also provided good publicity for the artists. Mayor Hammerstad observed that if the City set a maximum amount of$10,000 and artists dropped out, then the City would know that that did not work. Councilor McPeak commented that the price was subjective, including the factor of the materials selected by the artist. Mayor Hammerstad mentioned the hope that the businesses would buy a piece. Kim Gilmer, Parks & Recreation Director, held that it was significant that the City would buy a piece; therefore, the price range was important. Councilor McPeak spoke of the City commitment while the Mayor spoke of the budget cycle. Ms. Furman indicated that the Commission would recommend that the City purchase at least one sculpture. She noted that the pieces were for sale to the public. Mayor Hammerstad suggested making it a strong recommendation. Councilor Rohde suggested including an historical reference to the City purchasing a certain piece for a certain price. Ms. Gilmer noted that the City did sign a contract. Councilor Hoffman spoke to finding a way around the budget cycle. Councilor McPeak discussed Step 2 of the purchase policy. She spoke to selecting up to five pieces that were suitable in terms of price and location. Mayor Hammerstad asked for an opinion from the Arts Commission on whether the art stayed in the downtown area and whether they should include Lake Grove. Ms. Furman spoke of moving art out into the parks. Councilor McPeak discussed Step 3, speaking to selecting only pieces that the City could afford. She mentioned the selection committee developing a short list as the first step of the selection process. Councilor McPeak discussed Step 4, which included the same public process as the original draft but eliminated the veto. Mayor Hammerstad spoke to eliminating Step 4. She expressed her concern that one person could vote 20 times. Councilor McPeak argued that the public process, even flawed, had a high value. She spoke to selecting with controlled limits. Ms. City Council Morning Meeting Minutes Page 2 of 11 December 18, 2001 4b Furman spoke of the public having ownership through a public input process. Mayor Hammerstad held that they could select one piece in Step 3. Councilor Hoffman agreed with Councilor McPeak about having the public process. Councilor Turchi arrived at 8:00 a.m. Ms. Furman commented that the Commission would like some consensus of what people would like. Ms. Folwell indicated that they wanted to explain this policy to the Commission. She mentioned seeing what worked. Councilor Rohde indicated that he liked Step 4, which he thought they could monitor. Councilor Schoen held that they were making this process too complex. He noted the representative on the committee. Councilor Rohde moved to accept Arts Downtown purchase policy with the change to Step 1. Councilor McPeak seconded the motion. Councilor Rohde accepted Councilor McPeak's friendly amendment of developing a short list of up to five pieces suitable in terms of price and location. Mr. Schmitz noted that staff would put the guidelines for the proposal in the form of a resolution. A roll call vote was taken and the motion passed with Councilors Turchi, Graham, McPeak, Hoffman and Rohde voting in favor; Mayor Hammerstad and Councilor Schoen voted against the motion. [5-2] 3. REVIEW EVENING AGENDA Mayor Hammerstad mentioned that the list of topics provided by the Transportation Advisory Board looked like items for discussion at the Council goal setting session. She suggested asking the Board for specifics from the list in order to learn what were their concerns and most important issues. Item 4, Consent Agenda Councilor McPeak noted a correction to Item 4.1: her name was left off the interview committee. Mayor Hammerstad noted that Councilor Turchi was doing the consent agenda this evening. Councilor Rohde asked Councilor Turchi to flesh out two consent agenda items in more detail: what the Tree Code Review Task Force would be doing and more information about what would happen with the First Street alley sewer project. Mayor Hammerstad referenced Councilor Graham's e-mail to her about the business owner's concern regarding the First Street alley sewer project, that it would disrupt his business. Mr. Schmitz explained that the City delayed this project a year to early 2002 because of this same business owner's concerns. Councilor Rohde recalled that this business owner thought that this sewer pipe should go in State Street. There were no corrections to the minutes. Mayor Hammerstad asked to reduce the testimony time limits allowed by City ordinance from 10 minutes for neighborhood associations and 5 minutes for individuals to 5 and 3 minutes respectively for the hearing tonight. She held that this allowed ample time for testimony yet still allowed them to get through the hearing process. Councilor McPeak moved to reduce the testimony time limits to 3 minutes for an individual and 5 minutes for a representative of an organized neighborhood association. Councilor Turchi seconded the motion. A voice vote was taken and the motion passed with Mayor Hammerstad, Councilors Turchi, Graham,McPeak, Hoffman, Rohde and Schoen voting in favor. [7-0] City Council Morning Meeting Minutes Page 3 of 11 December 18, 2001 4 ,4 Item 7.1, Master Fee Schedule Update Mayor Hammerstad noted the revised copy of the fee schedule in the packet. Councilor Rohde asked for discussion on treating non-profit organizations the same as neighborhood associations with respect to waiver of appeal fees (page 118). Mayor Hammerstad pointed out that the City Manager had the ability to waive fees (page 82). Councilor Hoffman indicated that he was not concerned unless abuse became a problem. The Council discussed whether the City Manager should return to informing the Council of every waiver that occurred. Councilor Rohde indicated that he did not mind the notifications. Councilor Hoffman held that doing so was a waste of time. Richard Seals, Financial Planning Manager, indicated to Councilor Schoen that he did add the disclaimer(the City was currently studying the fee) to the athletic field fee (page 100), to the permit fee (page 111) and to the tree code fees (page 119). Item 8.1, Ordinance 2308 Mayor Hammerstad said that she would ask for additional testimony on the two amendments that the Council asked for at the last meeting, which were exempting lakefront properties and setting a sunset date. Item 9, Information from the Council Councilor Rohde said that he had a JPACT report. Councilor Rohde mentioned hearing that Metro was now looking at 800-foot buffers. Mayor Hammerstad stated that that was ridiculous. She noted that, if a local jurisdiction were to make the decision, then it could, within the ESEE analysis, set virtually any setback that it wanted to set. She indicated that Metro was using a basin approach. She explained that Lake Oswego, because it was in a number of basins, would have to form intergovernmental agreements with the governing jurisdictions. She questioned whether this approach was workable, given the need for joint hearings. Mayor Hammerstad commented to Councilor Rohde that the 800-foot number must have been a typo or something in the newspaper article cited by Councilor Schoen. She reiterated that there was no basis for that number. Item 9.1.1, Recommendation from the Parks and Recreation Advisory Board regarding Softball Field at Lakeridge High School Councilor Hoffman asked Mr. Schmitz to have staff provide him assurance at tonight's meeting that this field would be for community use by both the adult softball league and Little League. He described this as the school's problem, which the Superintendent wanted to solve by using the $250,000 of the community bond funds that were originally slated for the north Lakeridge field. Councilor Hoffman noted that both the Parks &Recreation Advisory Board (PRAB) and the Team Sports Advisory Committee (TSAC) concurred with the request. He held that it could be a win-win situation in developing a field as a recreation facility for baseball and softball, as long as it was a community facility, given that it used community bond money. Mr. Schmitz indicated to Councilor McPeak that this would meet the Title 9 requirements facing the School District, as the primary use of the field would be for Lakeridge girls' softball, followed by community use as secondary. He noted that this conformed to the joint use agreement. Mr. Schmitz explained to Councilor Schoen that the City was contributing $250,000 to a field that would cost$600,000 to build. He indicated that they could not segregate out what part of the field the City money was used for; their contribution would be used for construction costs. City Council Morning Meeting Minutes Page 4 of 11 December 18, 2001 5 0 Mayor Hammerstad confirmed that the District would be responsible for covering all the cost over and above the $250,000 contributed by the City. Councilor Schoen asked what park projects were they giving up by using the money here. Councilor Hoffman indicated that they lost the north Lakeridge field(the water tower field), to which this money had been allocated, and gained a facility that they probably needed. Councilor Graham mentioned receiving a phone call from a citizen upset over using City money to bail out a School District Title 9 problem. She spoke to assuring the people that other city activities would occur on that field. Councilor Graham asked if a girls' softball field was smaller than the standard adult softball field. Ms. Gilmer said that she would check on that but she did think that adult softball could use a girls' softball field. She noted that a Little League field was a bit shorter than a softball field. Councilor Turchi asked if the City agreeing to contribute funds gave tacit approval to lighting the field. Mr. Schmitz noted that the City was not specifying the elements of the field. He mentioned that the Oregon Civil Rights Commission has indicated that there was a need for lighting on the field. Mayor Hammerstad described the probable Council consensus as spending the money on the development of a girls' softball field was consistent with community use and in accordance with the joint use agreement. Mr. Schmitz noted that Superintendent Korach would be at the meeting; they could get his remarks on the record and do a follow-up letter. Councilor Graham mentioned her concern about who had responsibility for mitigating the wetland area. Mayor Hammerstad pointed out that the City was not selecting the site. Councilor Hoffman concurred with Councilor Turchi that lighted fields were a sensitive subject, and that, by approving the request, the City tacitly approved a lighted field. Mr. Schmitz said that the application had to go through the conditional use process, including notification of the neighbors. He emphasized that the City was approving a financial request. Mayor Hammerstad reiterated that the City was not selecting the site. Mr. Schmitz explained that, by staying out of the siting issue, the Council did not put itself in the potential position of hearing an appeal of a land use action that it has already endorsed. Councilor Rohde recalled that the City listed the original project in the bond for the voters to recognize, when he described as a 'good faith obligation.' He asked if the City would add the original project to the CIP and suggest future funding. Mr. Schmitz said that the City has gone through a process of saying that it was willing to transfer those funds to another project and to abandon the Cloverleaf project. Mayor Hammerstad reitereated that both PRAB & TSAC made that recommendation. Item 9.1.2 Clackamas County Coordinating Council Proposal Mayor Hammerstad noted the matrix provided by the Clackamas County Coordinating Committee illustrating the various proposals for a parks and/or library district. She observed that a parks district had many problems. She commented that, given Lake Oswego's existing parks program and its parks bond, she did not see that option as providing much benefit to the City. She referenced Councilor Rohde's earlier comment that Lake Oswego's tendency to pass these kinds of measures provided the rest of the County with a large number of positive votes, whereas the east side of the river was not inclined to pass them; thus, Lake Oswego could override local control. Mayor Hammerstad suggested that the Council not support the parks district option because Lake Oswego had its own parks system, and because imposing it on the rest of the County seemed arrogant and heavy-handed. She observed that it might not be possible at all, due to the economy. She mentioned that Bob Kincaid has been attending the technical meetings. City Council Morning Meeting Minutes Page 5 of 11 December 18, 2001 5 1 Bob Kincaid, Chief of Staff, concurred that the parks district concept would probably fall apart, citing other jurisdictions trying to develop their own parks systems. Councilor Hoffman asked what the problem was that they were trying to solve. Mayor Hammerstad said that the problem was the rest of the county not having enough money for parks. She noted that the problem with the library was slightly different: Mayor Hammerstad said that forming a separate library district (Option 4) was cumbersome and required a governing body as well as a tax base. She reiterated that, with Lake Oswego passing the last library levy at 80%, the city provided votes to pursue that option. She observed that Lake Oswego might not get as much out of a library district as it would out of a local option levy for libraries (Option 8). Mayor Hammerstad observed that Option 8, the local option levy for libraries, was essentially the same thing that they have done in the past. She noted that Lake Oswego passed the levy at 80%; therefore, it carried countywide. She mentioned the current funding allocation formula based on circulation. She recalled that it was a `bloodbath' when they did the allocation formula five years ago but it worked well for Lake Oswego because they had high circulation. Mayor Hammerstad mentioned the County's consideration of redoing the formula based on population, which would not be good for Lake Oswego. She pointed out that Lake Oswego had significant influence on the development of the allocation formula, since it brought an 80% vote to the table. She said that she would not move forward with either option unless they kept the circulation formula. Mayor Hammerstad indicated to Councilor McPeak that there was another option for Lake Oswego that was not listed on the matrix: going out for its own local option for the library. She explained that that was not necessarily the best option because Lake Oswego was part of a county library system, which included the ability to check books out in Multnomah and Washington Counties. She recommended supporting the County levy as in the City's best interest, provided that the allocation formula was fair. Mayor Hammerstad indicated to Councilor McPeak that the current allocation formula included a population element already. She agreed with Councilor Rohde that this would be a good discussion for the public to hear. Councilor Rohde referenced the discussion of the transportation utility fee and the transportation impact fee. He indicated that the County would model the transportation impact fee after the Washington County model, which collected the fee countywide and allocated it to the affected jurisdiction. Tom Tushner, Principal Engineer, described the Washington County program, which recognized the regional impacts of development. He said that the County obliged the local jurisdictions to spend the money on its arterial system. He mentioned a credit for development. Councilor McPeak asked if there was the political will in Clackamas County to do a countywide fee. Councilor Rohde recalled that there had been strong interest exhibited at the Timothy Lake retreat in developing a countywide system, as opposed to individual jurisdiction transportation utility fees. He pointed out that it created a more unified system of collection. Councilor Rohde noted that the request was for Lake Oswego to participate in funding a consultant to develop the program and the allocation formula for consideration. He said that right now they did not know how it would work, given the usual jurisdictional self-interests. Councilor McPeak asked if it was possible that Lake Oswego could get $1.2 million out of it. Mayor Hammerstad said that she thought it was possible but reiterated that the request was to hire a consultant to develop the program. City Council Morning Meeting Minutes Page 6 of 11 December 18, 2001 5 Councilor Rohde indicated that the Committee based the individual jurisdiction contribution amounts on a population allocation, similar to the way the League of Oregon Cities determined membership fees. Mr. Schmitz advised the Council that the petition regarding the naming of a certain tree in town might come forward under citizen comment. 4. REVIEW FUTURE AGENDA ITEMS Mayor Hammerstad mentioned the Bicycle Transportation Alliance presentation scheduled for January 2. David Powell, City Attorney, advised the Council that they needed to update the City's resolution listing the criteria for a recommendation to the OLCC to grant a liquor license. He recommended the January 2 date for the required public hearing. The Council discussed whether to hold a January 2 meeting. It agreed to cancel the January 2 meeting and to move the scheduled agenda items to January 15, including the swearing in of the Youth Councilors. Councilor Rohde suggested scheduling the Bicycle Transportation Alliance presentation for January 15. Mayor Hammerstad asked the Council to approve a reduction in the testimony time limits for the density guidelines hearing. Mayor Hammerstad indicated to Councilor Hoffman that the Council would receive the latest amended copy of the Waluga Neighborhood Plan, scheduled for January 8. Councilor Hoffman mentioned that he did have some concerns with the plan, which he had written up in his e-mail. Mayor Hammerstad explained that Mr. Sin's changes addressed those concerns, including removing the language favoring single-family detached homes (which LCDC objected to). Mr. Powell informed the Council that, while it was welcome to read all the Code consolidation documentation, it only had to read the executive summary because all the changes were content neutral and affected only the Code organization. 5. OTHER BUSINESS 5.3 City Phone System Councilor Hoffman expressed his concern that this item sounded like the Council was approving a $250,000 expense at a morning meeting, as opposed to an evening meeting. He held that the public would be interested in this discussion. Mr. Schmitz explained that this item was informational only; it did not require legislative action because it was already in the budget and on the State bid list. Mr. Powell concurred that the Council did not need to award the bid formally. Chip Larouche, Information Technology Manager,presented the plan to purchase Cisco voiceover/IT phones, thus giving every employee a new phone. He noted that the current phones and the 15 year old phone switch would disappear. He mentioned their background research into phone systems; Siemans (the owner of the City's current switch) gave a ballpark estimate in the $400,000 range, as did the maker of the switch at the school district. Mr. Larouche explained that he brought this to the Council today because they were ready to purchase some equipment that was on sale (40.5% discount) until December 31, 2001, through a Qwest contract with the State of Oregon. Mr. Larouche distributed a chart illustrating the impact of the system change on the operating costs: a 55% drop every year, which meant that the system paid for itself in six years. He explained that the system contained modular parts, which allowed staff to replace system elements as opposed to the entire system. He asked for Council approval to proceed with the purchases. City Council Morning Meeting Minutes Page 7 of 11 December 18, 2001 5 3 Mr. Larouche indicated to Councilor Turchi that a human voice would still answer the phone, as that was the Council policy. He described the expanded capabilities of the voice messaging system, including sending voice mails to the e-mail box for review. He indicated that the system did have the option of an automated answering system. Mr. Larouche indicated to Councilor Rohde that the dramatic increase in the costs for trunks represented buying additional capacity. He explained that the 24 trunks they had coming into the City were full, with no expansion room; by purchasing two `pries' (each capable of carrying 24 trunks) and putting 12 trunks in each pry, the City could add more trunks if it wanted to. Mr. Larouche indicated to Councilor Rohde that this new system used the same highways to transmit voice that were in the fiber coming from AT&T(scheduled for installation by January 31); the fiber would significantly improve the City's data transmissions. Mr. Larouche indicated to Councilor Rohde that the system did have wireless capabilities, but whether to take advantage of them or not was a policy decision. He explained that wireless phones required either a receiver or some kind of Internet Service Provider arrangement. Mr. Larouche confirmed to Councilor Hoffman that the State was converting to this system. He indicated that the only other jurisdiction that he knew of using this system was the City of Bend, which was 80% completed. He recounted the staff trip to Bend to look at the system. He said that Bend was happy with it. Mr. Larouche pointed out the $5,000 a year that the City currently spent on bringing Qwest in to do adds and changes; with the new system, he could do the adds and changes by computer. He indicated to Mayor Hammerstad that his goal was to have the system up and running by April 15 with June 30 as the final deadline. Mr. Larouche explained to Mayor Hammerstad that the Citywide problem with the current phones being dead lay in the 15-year-old switch. He commented that they were hoping it survived until April 15. Mr. Larouche indicated to Councilor Rohde that they built three days of training into the contract as well as web training tools and the ability to send people to Qwest or Cisco for refresher training. Mr. Larouche answered a series of specific questions asked by the Council. He explained to Councilor Turchi which buttons would be reprogrammed for re-dial. He mentioned that the receptionist phones were 6-line phones while all other phones were 2-line phones. He noted that the phones included caller id. He said that each user could program in his/her own directory of frequently called numbers. He indicated to Councilor Schoen that the system did not have a camera and therefore could not do face-to-face phone calls. Mr. Larouche indicated to Councilor Rohde that when the power went out, the system ran on its UPS (uninterrupted power supply) for the first 15 to 20 minutes and then would need the building's emergency direct generator. He mentioned to Councilor Graham that they talked Cisco into giving the City $10,000 to $12,000 for the old equipment and hauling it away. 5.1 Demolition of Hart House Mr. Schmitz indicated to Councilor Rohde that he needed to talk with Rachel about getting into the house. He clarified to Councilor Schoen that the Taylor house, not the Hart house, had been trashed. He confirmed to Councilor Graham that the City has allowed salvage of handrails, doorknobs, etc., from previous demolitions and would do so with the Hart house. Councilor Graham noted that the $13,000 price for the demolition was exclusive of any other costs arising due to hazardous materials. She asked if the Harts would be responsible for the removal of asbestos and lead-based paint. Mr. Powell said that the City purchased the house on an 'as is' basis, which meant that it had responsibility for the costs of that removal. He indicated City Council Morning Meeting Minutes Page 8 of 11 December 18, 2001 5 4 that something requiring an environmental action by DEQ, such as contamination from an oil- based furnace,would probably be the responsibility of the previous owners. Councilor Rohde asked if this house has been evaluated with respect to architectural integrity and historical value, given its age. He mentioned the possibility of raising money through grants for the restoration of historic properties. Mr. Schmitz said that the house was not on the City's historic inventory list because the evaluation did not rate a high number. Councilor Rohde reiterated that he wanted to see the house. Councilor Hoffman asked staff to obtain the Historic Review Advisory Board's opinion because its members were sensitive to the demolition of 84-year-old structures. He asked for the Glenmorrie Neighborhood Association's opinion also as well as the Natural Resources Advisory Board. He commented that the public tended to accuse a public body of not providing sufficient notice, and therefore he would like to garner input from these groups. Staff mentioned that the neighborhood would like the house to come down. The Council discussed taking a tour of the house with the Historic Review Advisory Board. Councilor Rohde commented that the demolition evaluation described the Hart house as being in the same condition as the Heritage House had been in before it was renovated. The Council agreed that staff should arrange a tour. 5.2 Compassionate Leave Policy Mayor Hammerstad indicated that she removed this item from the agenda. 5.3 State & A Mr. Schmitz mentioned the letter received by Mayor Hammerstad from a citizen about the change in the sequencing of traffic at the Highway 43 and A Avenue intersection. Mr. Tushner recounted the story of ODOT's changing of the signal light sequencing. He said that ODOT contacted City staff in early October about timing changes to accomplish three goals: to interconnect the McVey signal for the mid-day timing plan, to increase the cycle length to address peak hour southbound traffic movements and to address a litigation problem at the intersection with respect to the amber clearance signal. Mr. Tushner reviewed ODOT's change in the amber clearance interval from none to 'at the start of the cycle' (leading) to 'at the end of the cycle' (lagging). He indicated that the changes were made to achieve amber clearance for the center lane traffic. Mr. Tushner mentioned that he had asked ODOT to give him advance warning in writing of the exact date in November that they would implement the change but he received only two days advance notice. Mr. Tushner said that he put ODOT on notice about the software and minor hardware problems needing adjustment. He indicated that ODOT has received comments on the changes but not a deluge of comments. Mr. Tushner explained that the phasing at the signal at State and A was unusual in the state; the Lake Oswego police enforced someone stopping as 'an obstruction of traffic, which was a different interpretation than used by other police departments in the state. He commented that from his perspective that interpretation was somewhat awkward. He recalled that the police department had had some issues with the leading left turn when it was first installed. He speculated that they were seeing similar issues with the change to a lagging left turn. Mayor Hammerstad pointed out that people had gotten used to the initial signal setting. She commented that she thought that the leading left turn had worked well for both the north and south directions. She noted that the problem with the change to a lagging left turn was the inability of trucks to make a left-hand turn from the inner lane; therefore, they sat in the outer lane with a green light and no where to go, which backed up that lane almost past the railroad City Council Morning Meeting Minutes Page 9 of 11 December 18, 2001 0J tracks. She held that the changes were far worse than the initial set-up that everyone was used to. The Council generally agreed that the situation was worse now. Councilor Rohde suggested putting up a `doghouse' signal light and a sign on the signal light standard explaining when to turn. Mr. Tushner said that he would investigate installing a doghouse light, which he thought was a possibility. He mentioned that they were readily available and insignificant in cost but he did not know if it was an issue for ODOT. Mr. Tushner recounted the history he has heard with respect to the City's effort to put up a custom sign when the initial leading light went in, and ODOT's reluctance to allow a custom sign. He observed that traffic control signs needed to convey a clear and simple message. He mentioned ODOT and the State Traffic Engineer's efforts to keep signage uniform so that both daily commuters and out-of-towners could understand what they were supposed to do. Mayor Hammerstad commented that `proceed on arrow' seemed understandable. Mr. Tushner said that he would talk to ODOT, which maintained that it was the responsible agency, about reverting to the original sequencing and putting up additional signage. He indicated to Councilor Schoen that staff would investigate installing the doghouse light. Councilor McPeak commented that, by changing the original sequencing, ODOT has already admitted tacitly that this intersection was unusual. She described this as an unusual enough situation to warrant a sign, even if ODOT did not want signs in many places. Mayor Hammerstad described the problem with turning left from A Avenue to Highway 43 (heading towards Portland) during rush hour traffic. She mentioned the north lane backing up through the intersection and the short light that allowed only five cars through. Councilor Rohde commented that the City asked for that design in order to allow for the median. Mr. Tushner recalled that, during their first meeting with ODOT, ODOT agreed not to substantially change and of the side street timing when it retimed the signals. He noted that ODOT increased the cycle length but retained the percentage allocated to the side streets. He observed that things became very difficult with an under-capacity intersection. He indicated that part of the reason for the current left turn configuration was an attempt to address the capacity issues. He mentioned that the long-term plans called for a dual left turn lane but on a practical level, that was an expensive project. Councilor Turchi commented that they should discuss this at an evening meeting. Mayor Hammerstad suggested that Mr. Tushner bring it up under Information from the Council. Mr. Tushner suggested that he approach ODOT before discussing this in public. He indicated that he preferred to have an ODOT Westside traffic signal manager with him during that discussion. Mayor Hammerstad concurred that Mr. Tushner should contact ODOT and inform them that this was a community concern. She mentioned scheduling a presentation on a TV night, such as February 5. Mayor Hammerstad suggested to Councilor Rohde that they discuss his concern about the youth candidates on the advisory boards at the agenda retreat. She suggested that Councilors Turchi and Rohde recruit right now at the high schools for these positions. Councilor Turchi observed that they might reach more interested students in the political action classes. Councilor Turchi suggested that they go through the chain of command, starting with Mr. Schmitz talking to Mr. Korach, in recruiting advisory board youth members. Mayor Hammerstad directed Mr. Schmitz to start the process. Councilor Turchi spoke to setting up a process whereby they advertised for Youth Councilors and made the appointments in April and May, rather than in October. He suggested recruiting from the current juniors and sophomores for the Youth Council. City Council Morning Meeting Minutes Page 10 of 11 December 18, 2001 5 6 6. EXECUTIVE SESSION Mayor Hammerstad recessed the meeting at 9:30 a.m. to Executive Session pursuant to ORS 192.660(1)(e), to consult with persons authorized to negotiate real property transactions on behalf of the City. 7. RETURN TO OPEN SESSION Mayor Hammerstad reconvened the meeting at 9:43 a.m. 8. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 9:45 a.m. Respectfully submitted, 61(44 RobynChr' tie City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Morning Meeting Minutes Page 11 of 11 December 18, 2001 J 5 , 4.3.3 02/05/02 MINUTES OF DECEMBER 18, 2001 SPECIAL MEETING 54 li (► o�L.,oswe ` c° CITY COUNCIL SPECIAL MEETING MINUTES 11► December 18, 2001 \ / o« Mayor Judie Hammerstad called the City Council special meeting to order at 5:20 p.m. on December 18, 2001, in the Municipal Courtroom. Present: Mayor Hammerstad, Councilors Rohde, Schoen, Turchi, Graham, McPeak and Hoffman. Staff Present: Doug Schmitz, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Kathy Marcott, Engineering Technician; Tom Tushner, Principal Engineer TAB Present: Jim Kronenberg, Henry Germond, Rose Rummel-Eury, Donna Jordan (Chair), and Steven Schulte (Vice Chair) 3. Study Session with the Transportation Advisory Board Donna Jordan, TAB Chair, discussed a problem that the Board had with reaching a quorum. She mentioned two upcoming public hearings, for which they were trying to make sure that five Board members would be present. Ms. Jordan discussed the pathway criteria plan they developed, and their efforts to make sure that funds were reallocated in the budget for the pathway projects. She reported that the Board felt that the top three projects they have identified were well received by the neighborhoods. She mentioned a concern that, by having a set of pathway criteria, people might expect to see a continued expansion of the tax rate. She spoke of looking into how they could expand the vision of funding, not only street maintenance, but all the various pieces in the puzzle of improving and maintaining all transportation opportunities. Ms.Jordan indicated that they were proceeding with the George Rogers Park expansion. She noted the problem of bringing more cars into the area, as the neighbors already complained about people parking in front of their houses. She mentioned another issue of getting pedestrians across Highway 43 safely. Ms.Jordan spoke of looking at the whole downtown redevelopment in terms of the traffic light pattern placements, referencing the citizen concern about the crossing at 5th and A. She mentioned that the Board was trying to figure out how to work with the Council and its goals that were specific to the Board's purview. Mr. Germond raised a concern with their youth board member who had attendance problems due to her commitment to the soccer team. He suggested including attendance as a criteria during the interview process. Mayor Hammerstad apologized for the Board not having a youth member. She mentioned that the Council redesigned the Shadow Council program in order to give the students a better experience. She noted that the additional responsibilities and expectations scared some students away. Mayor Hammerstad said that the Council was working on the youth advisory board member appointments, but the Board might not have a youth member until spring or next year. Mr. Germond suggested having alternates. Ms. Jordan mentioned a difficulty with finding a chairman. Mayor Hammerstad observed that that was a common problem for committees. She mentioned that last year some committees might not have had enough `meat' in terms of their work. City Council Special Meeting Minutes Page 1 of 3 December 18, 2001 6 1 Ms.Jordan spoke of the Board's efforts to keep involved and to find creative solutions to problems. She mentioned the heavy involvement of people and time with the Boones Ferry Corridor Study. She noted their concern with how to keep those kinds of big projects moving forward, mentioning the upcoming Meadows Road project. Tom Tushner, Principal Engineer, recalled that six months ago staff applied to ODOT for $25,000 cash towards a $130,000 project on Meadows Road between Carman Drive and Bangy Road. He said that when ODOT rejected their request, they cut the project out. He explained that a week ago ODOT sent the City a letter, referencing the upcoming economic stimulus package and asking if Lake Oswego could live up to its original commitment. He indicated that staff was looking into finding the $100,000. Mayor Hammerstad informed the Board that the Council has asked for a presentation by ODOT on the State's changes to the intersection at State Street and A Avenue. She mentioned wanting to discuss the efficiency or non-efficiency of those changes. Ms. Rummel-Eury described the confusion that she has observed at the intersection following those changes. Ms. Jordan wondered why ODOT chose to change the signal light timing in November, which was the start of the holiday season. Mayor Hammerstad referenced the Council's goal setting session in January. Ms.Jordan mentioned finances and the entrance to Hwy 43 in Glenmorrie. She spoke of having the capability to make small changes. Mr. Germond observed that the Oak Street/Glenmorrie crashes did not warrant a major change; however, that count did not include incidents or near misses. He spoke of a sharp upgrade. Mayor Hammerstad commented that sometimes the solution was worse than the problem. Ms. Jordan mentioned citizen involvement and reaching a compromise on the 5th and A crosswalk situation. Mayor Hammerstad spoke of a trolley to streetcar connection. She mentioned the North Macadam project, which ended at Gibbs Street. She indicated that it was on a fast track for 2004 and without federal dollars. She referenced the Foothills properties in Lake Oswego and spoke to the possibilities over the next five years. Ms. Rummel-Eury noted the neighborhood opposition to the tram. Mayor Hammerstad commented that the North Macadam to OHSU traffic became accommodated traffic. Mr. Schulte referenced the four projects identified by the Board for this year, all of which had good neighborhood support. He discussed their concern that they might not be able to spend all their allocations for those projects within this fiscal year. He asked if they could carry the money over to the next fiscal year. He indicated that three projects were short in length and the fourth longer. He asked if they should prioritize. Doug Schmitz, City Manager, indicated that there was no guarantee of a carry over, although they could make the request to the Budget Committee. Ms. Jordan observed that they needed to get moving on the projects. She mentioned making links to schools or other public areas. She discussed the issue of geographic equity in the distribution of links. Mr. Tushner pointed out that the three smaller projects were easier to engineer, which staff was in the process of doing. He indicated that staff would develop a recommended priority list for the Board and give the Board a sense of the engineering and feasibility of the four projects. He observed that the larger($135,000) project would likely not be done this year but perhaps the remaining three ($40,000 each) would. Ms. Jordan expressed the Board's appreciation for Mr. Tushner and Ms. Marcott's work as their staff liaisons. Mr. Schmitz announced that construction started on the Palisades project tomorrow. City Council Special Meeting Minutes Page 2 of 3 December 18, 2001 6 ; Councilor Turchi noted that the Board members have now received their property tax statements, which included the school measure. He asked to what degree did they think that Lake Oswego citizens would favor increased property taxes to fund traffic and transportation projects. Ms.Jordan mentioned the Board's discussion of reviving local improvement districts (including partial districts) and finding creative ways to generate neighborhood support for pathways. Ms. Jordan spoke to getting one of these pathway projects going in order to have something to point to in generating that support. Mr. Kronenberg commented that people did not know about the projects. He speculated that if they saw a project in progress or completed, then they might feel better about the process. Ms.Jordan observed that there were many ways to provide pedestrian connections other than the traditional sidewalk, curb and gutter. 4. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 6:00 p.m. Respectfully submitted, ‘ a),:,,,,k,-, R byn istie City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Special Meeting Minutes Page 3 of 3 December 18, 2001 6 3 64 4.3.4 02/05/02 MINUTES OF JANUARY 8, 2002 SPECIAL MORNING MEETING 66 01 Oat OSM} ` \° CITY COUNCIL MINUTES CAI► 1R January 8, 2002 �O EGO$ - Mayor Judie Hammerstad called the special City Council meeting to order at 7:32 a.m. on January 8, 2002, in the City Council Chambers. Present: Mayor Hammerstad, Councilors Turchi, Graham, McPeak, Hoffman, Rohde (arrived 7:35 a.m.) and Schoen. Staff Present: Doug Schmitz, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Stephan Lashbrook, Community Development Director 3. REVIEW EVENING AGENDA Mayor Hammerstad noted the four presentations scheduled for the study session this evening. She requested that Councilors ask only for more information this morning and hold their substantive questions for this evening. Item 3.2 Planning Commission Recommendation for Approval of Zoning/Development Code Consolidation (LU 01-0048) David Powell, City Attorney, indicated to Mayor Hammerstad that staff could make the staff report this evening short, depending on the level of detail that the Council wanted to hear. He expressed his appreciation for Councilor Hoffman reading the whole thing but pointed out that all the Council really needed to know was that staff was consolidating everything into one place in an effort to make the Code more logical and readable. Item 3.3. Draft Waluga Neighborhood Plan (LU 00-0025) Mayor Hammerstad noted that the neighborhood made the changes to its plan that Council requested. Mayor Hammerstad explained to Councilor Graham that she did not need to read earlier drafts of a staff report because staff incorporated the changes into the latest draft. She suggested following a rule of thumb: read only what was pertinent. Item 3.4 Planning Commission Recommendation for Approval of Density Guidelines (ZC 7-98) Councilor McPeak requested information on whether other jurisdictions had the future development plan concept in place or were considering it. Mayor Hammerstad observed that the concept existed in overlays on developments, such as Clackamas Town Center or Washington Square, with one intent of preventing underdevelopment. Stephan Lashbrook, Community Development Director, indicated to Councilor McPeak that, with respect to minimum density specifically, he knew that some jurisdictions have applied the minimum density requirements across the board and not exempted partitions at all. He explained that the Planning Commission had been trying to create a situation where people could not circumvent the minimum density requirement by going through a series of partitions year after year. He said that he would research the question today and provide the information in the evening. Mr. Lashbrook indicated to Mayor Hammerstad that Lake Oswego, if not the last jurisdiction to adopt the minimum density requirements, was one of a handful of the last. Mayor Hammerstad asked Mr. Lashbrook to explain to her later in the day, the application of the mathematical formula for determining a lot size (minus the 20% for roads and streets). City Council Morning Meeting Minutes Page 1 of 4 January 8, 2002 6 'r Mayor Hammerstad recalled that she had talked to David Bragdon about the impact of the City buying up open space in an area that might come into the urban growth boundary in light of the population and housing targets mandated by Metro, and whether it led to a problem of density transfer, including the open space. She said that the answer was yes, according to the City Code. Mayor Hammerstad said that Metro, in looking at the amount of the area that could come into the urban growth boundary, would take out the open space. She stated that she wanted to be on that committee in order to ensure that Lake Oswego did not have density transfer from that open space, which would put the City in a bad situation. Mr. Lashbrook clarified to Councilor Schoen that the City either took out the actual amount of roads, streets and parks or it used the 80%/20% allocation. Councilor McPeak asked staff to give a clear explanation of density transfer for the audience this evening. Mayor Hammerstad mentioned including the exemptions. 4. REVIEW FUTURE AGENDA ITEMS Mayor Hammerstad noted the addition of a study session on annexation and tax increment financing on Monday, January 28. She indicated to Councilor Schoen that sign ordinance was rescheduled for January 29. The Council discussed going out to dinner after the Friday retreat session but decided to do it another night. Mayor Hammerstad mentioned that the invitation to civic groups to come to the Saturday morning session would be in the paper this week. The Council discussed the parking arrangements at U.S. Bank. 5. OTHER BUSINESS 5.1 Selection of date for tour of Hart Property Mayor Hammerstad recalled the concerns on the Council that the City might want to preserve the house instead of demolishing it. She referenced the demolition request in asking for consideration that the Council was not experts on the question, and it did have a recommendation for demolition from an expert who reviewed the matter. Mayor Hammerstad observed that the Council going out en masse might arouse neighbors' concerns. She asked what the consequences were to a Council desire to preserve the home, especially in terms of finances. She indicated to Councilor Hoffman that she thought it would be more appropriate for the Historic Review Advisory Board to tour the house, as opposed to accompanying the Council on a tour. Councilor Rohde reported that he looked at the house after the last meeting. He indicated that it was probably a house worth saving; it was over 100 years old and Lake Oswego had few of those homes left. He pointed out that the `expert' who recommended demolition also recommended the demolition of Lantern Lodge, the Thiely residence and the Heritage House for the same reasons: the houses were in terrible condition and would require a lot of money to renovate. He argued that those facts did not mean that they simply abandoned the effort. Councilor Rohde held that the house had some historical value to the community. He spoke to finding ways to preserve it, such as National Historic Register grants. He argued that, although it was easier and less costly in monetary terms to tear down the structure, it might be more expensive in social terms. Councilor Graham said that she would like to tour the house. She indicated that she wanted to know why it would be demolished and why it would not be demolished. She suggested splitting the Council visit if it would attract too much attention. Councilor McPeak asked if it was trickier politically to have HRAB tour the house, recommend retaining it and the Council disagree with the recommendation. She said that, in that situation, City Council Morning Meeting Minutes Page 2 of 4 January 8, 2002 6b she was uncomfortable not seeing the house. She questioned the difficulty of an HRAB decision versus a Council visit. Councilor Turchi reported that he took looked at the house and saw some architectural merit, characteristic of the period. He acknowledged the point that HRAB designating the house as worth preserving left the Council with having to take on an historically designated site, a situation with which he was uncomfortable. Mayor Hammerstad indicated to Councilor McPeak that it was best to see the inside rather than simply to go and look at the outside on one's own. Councilor Hoffman said that he had no problem touring the home with HRAB. He pointed out that the citizens on that committee have given the Council their opinion on the head gate and other items; the Council accepted some of their recommendations but not all of them. He commented that HRAB wanted to be consulted by the Council on these matters. He remarked that the house might be worth preserving but the Council might not be able to afford to do so. He spoke in support of looking at the house. The Council discussed when to schedule the tour. Councilors Schoen, Turchi, Rohde and Hoffman each indicated that he could take the tour on Wednesday, January 9, at 10 a.m.; Mayor Hammerstad, Councilors McPeak and Graham each indicated that she could take the tour on Wednesday, January 16, at 9 a.m. The Council discussed setting a date for the Board and Commission/City Council dinner(with spouses) at the Country Club. It agreed on January 27 at 6:30 p.m. Councilor Hoffman agreed to confirm the date at the Country Club. Mayor Hammerstad confirmed to Councilor Graham that she should tell Shirley to re- schedule the Library Advisory Board interviews (January 24) because they conflicted with the Clackamas Cities Dinner. Mayor Hammerstad noted that Lake Oswego was the host for the February Clackamas Cities dinner. She commented that Councilor Rohde's suggested economist sounded like a good speaker. Councilor Rohde also suggested Representative Darlene Hooley. Mayor Hammerstad said that she would ask her. Mr. Schmitz indicated that staff would respond to the request from a schoolgirl in Rye,NY, regarding her school project on cities on the West Coast. Councilor Turchi mentioned that Lake Oswego school children send out letters all across the country requesting similar things, and that there was a certain reciprocity expected. 6. EXECUTIVE SESSION Mayor Hammerstad recessed the meeting at 8:04 a.m. to Executive Session pursuant to ORS 192.660(1)(i), to review and evaluate the performance of an officer, employee, or staff member pursuant to standards, criteria, and policy directives adopted by the City Council. Councilor Turchi moved to give the City Manager and the City Attorney a 5% increase to get them partially towards parity with other jurisdictions, and an additional 2% added on July 1, 2002, to cover the cost of living. Councilor Graham seconded the motion. A voice vote was taken and the motion passed with Mayor Hammerstad and Councilors Turchi, Graham, McPeak, Hoffman, Rohde and Schoen voting in favor. [7-01 7. RETURN TO OPEN SESSION Mayor Hammerstad reconvened the morning meeting at 9:33 a.m. Councilor Graham presented a request from Kay Roney of the Lake Oswego Lakers that the Council donate a luncheon as an item at the Lakers annual fund-raising auction in February. Mayor Hammerstad discussed her concern that the Council already had a meal engagement City Council Morning Meeting Minutes Page 3 of 4 January 8, 2002 6 �i donated to the Rotary Club, which has not been taken up. She expressed her discomfort with the Council donating several of these kinds of things, only to have them all come up during the same month. The Council agreed not to donate a luncheon. 8. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 9:37 a.m. Respectfully submitted, Rob hris ie ajl'A:4411 City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Morning Meeting Minutes Page 4 of 4 January 8, 2002 U 4.3.5 02/05/02 MINUTES OF JANUARY 8, 2002 SPECIAL MEETING 71 7N LAKE 1p) osw CITY COUNCIL MINUTES January 8, 2002 atmom Mayor Judie Hammerstad called the City Council study session to order at 6:05 p.m. on January 8, 2002, in the City Council Chambers, 380 A Avenue. Present: Mayor Hammerstad, Councilors Turchi, Graham, McPeak, Hoffman, Rohde and Schoen. Staff Present: Doug Schmitz, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Sidaro Sin, Associate Planner; Evan Boone, Deputy City Attorney; Stephan Lashbrook, Community Development Director; Jane Heisler, Associate Planner; Denny Egner, Long Range Planning Manager 3. STUDY SESSION 3.1 Planning Commission Recommendations for Approval of Neighborhood Notice Requirements (LU 01-0045) Sidaro Sin,Associate Planner,mentioned that the intent of the proposed amendments was to increase notification and citizen involvement in land use applications. He noted that these amendments would apply citywide and pertain to the required neighborhood association meetings and mailed notices for pending land use applications. Mr. Sin noted the change requiring developers to mail notices to the abutting neighborhood associations, in addition to the impacted neighborhood association. He reviewed the requirement that expanding the 300-foot mailing notice area in 10-foot increments until 50 property owners were notified(when there were not 50 property owners living within 300 feet of the property). Mr. Sin mentioned the requirement that the applicant provide more detailed and specific information at the neighborhood meetings. He indicated that a neighborhood association chair would have the opportunity to provide a list of the neighborhood's concerns in addition to the applicant's separate minutes. Mr. Sin said that Jeff Novak was the sole testifier at the Planning Commission's November 16 hearing; staff incorporated his comments into the draft amendments, which the Commission recommended for approval. Councilor Graham asked for clarification on Point 6 (page 5). She asked if the determination that an application was complete meant that the application was in compliance or simply completed. Mr. Sin explained that an application had to meet certain requirements in order to be deemed complete. Councilor Schoen noted that, although the requirements applied city wide, four neighborhoods drove the changes. He asked what input the City received from the rest of the city. Mr. Sin said that staff did multiple mailings through the Planning Commission and received no comments from any other neighborhood association. Councilor Schoen asked what was the rationale behind notifying abutting neighborhood associations of developments. Mr. Sin said that the concern arose out of the fact that the impacts of a development in one neighborhood, such as on traffic or water runoff, could potentially impact the abutting neighborhoods. He clarified that the requirement was to mail out letters to the abutting neighborhood association chairs, and not to everyone in the abutting neighborhoods. City Council Study Session Minutes Page 1 of 13 January 8, 2002 , (3 Mr. Sin indicated to Councilor Hoffman that the Code consolidation would update the references in the document. Councilor Hoffman asked if the 10-foot increment rule was in the Waluga Neighborhood Plan, stating that he did not remember seeing it there. Mr. Sin indicated that the reference to the closest 50 property owners was in the Waluga plan but the idea came from Planning Commission brainstorming sessions on how to notify 50 property owners. Councilor Hoffman observed that this would apply to all neighborhood plans and land use applications. He indicated that he did not see this as an unduly expensive proposition for the developers, who preferred working with the neighborhoods at the beginning of the process as opposed to hearing objections at the Planning Commission hearing. Councilor Rohde asked to include First Addition and Old Town on the grid (page 4) because they were adopted neighborhood plans. He pointed out that First Addition served as the template for the remaining neighborhood plans. Councilor Rohde asked why the lake was left off as an abutting neighborhood association. He pointed out that something done in his neighborhood association was seen by everyone in Hallinan across the lake. Mr. Sin indicated that the Commission did discuss that question. He said that staff recommended staying with the abutting neighborhood associations because all the lake was zoned residential; there was little chance of multi-family or commercial developments with their significant visual impacts occurring. Dan Vizzini, Planning Commission, concurred that the Commission concluded that, given the predominantly residential nature of the neighborhoods around the lake, notifying the across-the- lake neighborhoods seemed like overkill. He spoke of trying to reach a balance in not making this too onerous. He indicated to Councilor Rohde that they tried to incorporate as much of the neighborhood plan noticing requirements as possible while achieving more efficiency in a uniform code for the city. Councilor Hoffman referenced Section 49.36.710 (page 10). He questioned giving the neighborhood associations an additional 10 days to identify issues after starting the 120-day clock(upon completion of the application). He suggested deeming an application complete except for neighborhood input and waiting until after the 10 days to start the 120-day clock. He observed that it was a staff issue of determining whether they needed the time. Mr. Sin explained that often, between the time of the neighborhood meeting and the application submittal, the design or application changed. He said that giving the neighborhood the 10 days was staffs attempt to deal with neighborhood issues at the beginning of the process, as opposed to at the end of it. He mentioned that, as part of these amendments, they were writing into the Code that the neighborhood chairs could submit their own list of concerns. He indicated that he was comfortable that they could get through the process within the 120 days. Councilor Graham referenced Section D (page 10) and Section 7A (page 11). She asked why the same sentence was crossed out on page 10 but left in on page 11. David Powell, City Attorney, indicated that the sentence was duplicative, and did not need to be on the first page. Mayor Hammerstad noted the public hearing scheduled for February 5. 3.2 Planning Commission Recommendation for Approval of Zoning/Development Code Consolidation (LU 01-0048) Mr. Sin explained that the intent was to reorganize the City Zoning Code, Development Code and Development standards by consolidating them into a more logical flow. He noted that the consolidation did not include any substantive modification to the text. He mentioned that the last Code reorganization occurred in 1982. City Council Study Session Minutes Page 2 of 13 January 8, 2002 7 4 Mr. Sin reviewed the three categories of revisions: changing references from Planning Director to City Manager, correcting typographical errors and providing an explanation for any changes that went beyond the first two. He noted the errata sheets for errors detected after the consolidation went to print in December. Mr. Sin described how the reorganized Code followed the chronological steps of the land use process. He mentioned that there was no public testimony at the Planning Commission's November 26 public hearing; staff had not received any written comments. He said that the Planning Commission recommended adoption of the reorganization. Councilor McPeak asked why staff changed `Planning Director' to 'City Manager.' Evan Boone, Deputy City Attorney, explained that the Development Code said City Manager while the Zoning Code said Planning Director; Tom Coffee, the former Planning Director who worked on the reorganization, had favored City Manager over Planning Director. He noted that the definition of City Manager included the City Manager or his designee. Mr. Powell observed that the Code often referred to City Manager in lieu of another staff position title because the Charter mandated that the City have a City Manager, whereas the City could change other staff position titles as appropriate. He said that the City Manager then delegated those duties to the various department heads. Mr. Boone discussed the process he, Tom Coffee, Hamid Pishvaie and Mike Wheeler went through, beginning in 1999, to develop the Code consolidation. He indicated that the Planning Department has been using the working draft(second draft following staff comments) for 8 months, which resulted in additional comments and revisions. He mentioned the press release on the draft Code consolidation given to the papers, the Chamber and frequent users of planning services as well as the inclusion of the draft on the City website. Mr. Boone indicated that staff issued another press release to the same people following the Planning Commission's work. He mentioned an article in Hello, LO. He said that they have not received any public comments, other than from one neighborhood chair who said that he was pleased with the result. Councilor Rohde asked how staff has integrated the Code consolidation with the City's e- government procedures. Mr. Boone explained that, upon adoption and becoming part of the Code, staff would put it on the City website under the Code page. He mentioned the use of a PDF mode, which would make it easier to view the Code online. He noted that the consolidation also included the development standards, which have not been online previously. Councilor Rohde spoke to staff writing an article on the Code consolidation for the League of Oregon Cities newsletter. He thought that other communities in Oregon would be interested in following up on Lake Oswego's process. Mr. Powell mentioned that Lake Oswego's Code was among those posted on the League website and accessible statewide. Mayor Hammerstad suggested that Mr. Powell and Mr. Boone send a press release to the League. Dan Vizzini, Planning Commissioner, said that the Commission was happy with the product and has been using it since it received the first draft. He mentioned that the most critical user of the document, Ken Sandblast (a planning professional), was pleased with the flow of the document and found it a good product from the user's point of view. Mr. Boone mentioned that they would put the neighborhood notice provisions (and the other ordinances scheduled for hearing on the same night) into the consolidation format once they knew that they would be adopted. He explained that the theory was that when the Council adopted the new Community Development Code first, staff would have already put the other ordinances into the new format. Councilor Hoffman said that he thought it was a good product. He asked where the definitions were for Section 50.41 (drainage standards for major development), as he could not find them. City Council Study Session Minutes Page 3 of 13 January 8, 2002 '( J Mr. Boone indicated that Councilor Hoffman was the first one to notice that omission; staff would put those definitions in the definition section. Mr. Powell mentioned the hard work and time invested by Mr. Boone and the Planning staff (Mr. Pishvaie, in particular) in reorganizing the Code. Mayor Hammerstad noted that the public hearing on the Code was scheduled for February 5. 3.3 Draft Waluga Neighborhood Plan (LU 00-0025) Mayor Hammerstad recalled that the Council appointed a Council subcommittee to work with neighborhood representatives with respect to Council concerns with the plan. She mentioned that they also worked on the revisions requested by the Department of Land Conservation and Development(DLCD) for compliance with state law. Mr. Sin mentioned that the subcommittee had identified 16 policies of concern. He indicated that the subcommittee, staff and the Waluga Steering Committee worked over the last 7 months to find acceptable language for the 16 policies. He noted that the earlier agenda item addressed the plan policies requiring additional notification. He commented that the working group reworded the plan policies, which had required a higher degree of scrutiny for changes to multi- family or commercial zones, to strongly emphasize the City's current requirements for zone changes. Mr. Sin indicated that the group eliminated those policies, which the DLCD construed as unfairly promoting single-family development, and replaced them with a statement regarding the character of single-family developments as urban space and the use of open space. He noted that the subcommittee supported the plan policy prohibiting new drive-through window facilities in the Lake Grove business district (as a means of ensuring a design quality for future development in the area). Mr. Sin said that the subcommittee accepted the Transportation Advisory Board's recommendation to keep the sidewalk and bike lane on the east side of Quarry in addition to providing a sidewalk along Douglas Way. Mr. Sin confirmed to Mayor Hammerstad that the neighborhood association agreed with the changes. Councilor Hoffman said that he went through the plan pretending to be a developer who wanted to get a zone change for a tri-plex (a major development). He stated that he could not figure out what the burden of proof was for the applicant. He confirmed to Mr. Powell that he was referencing the example on page 9. Mr. Powell indicated that the Comprehensive Plan Goal 2, Policy 14F, already set out the burden of proof for an applicant, which was confirmed by case law as applicable in all quasi- judicial land use proceedings. He concurred that the Comprehensive Plan policy did not include the words `strictly required.' He referenced Mr. Sin's staff report discussing the DLCD's objections to the proposed plan policies favoring single-family housing. Mr. Powell explained that, in the discussions, the neighborhood clarified that it wanted to say that what it really meant was that a developer had to demonstrate substantial evidence and meet the burden of proof described in Policy 14F. He mentioned the neighborhood's concern that prior decisions did not pay enough attention to the existing burden of proof. He said that the Task Force recommended language, such as `strictly required,' in order to address the neighborhood's concern, rather than changing the criteria. Councilor Schoen asked what the rationale was for not allowing new drive-through food services. Mr. Sin referenced the research on other cities' handling of this issue, which he did at the subcommittee's request. He said that 50% allowed some form of drive through facilities and 50% did not. He explained that the primary factor was the intent to develop pedestrian activity in town centers; drive-through facilities were seen as having an adverse impact to that intent. He City Council Study Session Minutes Page 4 of 13 January 8, 2002 7 6 noted that this prohibition was also consistent with the Lake Grove Neighborhood plan, which governed the other side of Boones Ferry. Mayor Hammerstad mentioned the subcommittee's concern about proliferation, as there were already several drive-throughs in the area. She pointed out that this prohibited new drive- throughs as a means of making the area more pedestrian friendly and discouraging drive through use. Councilor Schoen observed that this was the only area of the City that provided drive- through services. Mr. Boone confirmed to Councilor Hoffman that the plan would include the 10-foot increment in the noticing provisions discussed earlier. Councilor Hoffman noted a typographical error on page 2, RAM 2. Mayor Hammerstad opened the meeting to public testimony. • Jeff Novak, 4322 Collins Way Mr. Novak expressed his hope that they would see this adopted soon, as they have been working on it for five years. He noted the active involvement by the neighbors and the Steering Committee's work in soliciting input from the neighbors. He described the biggest issue for them as finding a way to communicate the characteristics of their neighborhood for planning decisions. Mr. Novak observed that Waluga was unique in that it was the densest of all the Lake Oswego neighborhoods. He noted that their geography shaped them as an island of residential, which they wanted to protect from encroachment. He explained that that factor lay behind the wording `strictly required.' He acknowledged Waluga's status as a primary planning model of what the City was trying to do in terms of single-family residential surrounded by multi-family residential and a business district. Mr. Novak indicated to Mayor Hammerstad that the neighborhood was supportive of the Council discussion. Mayor Hammerstad noted that the public hearing on the plan was scheduled for February 2. Councilor Hoffman asked for clarification of a statement on page 47: "do not adopt criteria that will include deterioration or demolition as a justification for a zone change." Mr. Powell noted the deletion of the original policy proposed by the neighborhood to not allow deterioration or demolition of existing homes as a reason for plan and zoning map amendment changes. Mr. Powell discussed the subcommittee's concern about having a policy that prohibited deterioration as a reason for a zone change, while at the same time the City wanted to encourage the redevelopment of dilapidated areas. He described the statement as a compromise, in which the neighborhood asked that the City not adopt official zone change criteria that included deterioration or demolition as justifications themselves. Mr. Powell indicated to Councilor McPeak that the City has never adopted those criteria. He noted that this was a directive to the City not to do so. He described the neighborhood's concern as a developer using the deterioration of a house as it aged as justification for a zone change to commercial. He pointed out that this compromise provided the neighborhood with some assurance that the Council would not make that a criterion yet did not delve into the motivations of redevelopers. Councilor Hoffman asked what it added to the plan to include the statement on page 49 about enhancing the character of low-density residential development within the Waluga neighborhood by requiring the preservation of open space and natural resources per the City's adopted Sensitive Lands Ordinance. He pointed out that the City already had the Sensitive Lands Ordinance and overlays. City Council Study Session Minutes Page 5 of 13 January 8, 2002 7 7 Mayor Hammerstad recalled that this was one of many similar comments and a problem for the DLCD. She explained that the subcommittee decided to leave in basic goal statements of what the residents wanted their neighborhood to look like while removing other superfluous comments. Councilor Hoffman said that he had no problem with the neighborhood character statement, except that it seemed to be directly contrary to what DLCD said. He questioned whether the list of characteristics on page 61 was consistent with the subcommittee's intent and DLCD's direction. Mayor Hammerstad said that the subcommittee looked at this list as a goal statement and the statement on page 49 as a mission statement. She emphasized that they were not regulatory statements. Councilor Hoffman reiterated that he saw a tension between DLCD's direction and the Steering Committee's discussion of its vision for the future. Mr. Powell pointed out that DLCD's letter did not oppose the idea of celebrating the idea of the neighborhood's single-family nature and desiring to preserve it. He explained that DLCD objected to regulatory provisions that made that harder or impossible to achieve. He concurred that the Task Force did not see the character statement as violating DLCD's direction; it was a statement declaring the neighborhood's aspirations. Mayor Hammerstad recalled that DLCD wanted the neighborhood plan to allow for any type of housing. She indicated that the lack of that allowance was what DLCD based its objections on. She spoke to leaving the statement in, citing the numerous compromises by the patient neighborhood, which was been willing to work these issues through. Councilor Hoffman concurred that the plan was a good piece of work. Mr. Powell referenced a sentence on page 66 and several policies under Goal 10, which stated a goal of encouraging the maintenance of single-family residential uses as the predominant land use, as long as other housing types were not unduly excluded. He held that that was consistent with the neighborhood character statement. Councilor Rohde asked if RAM 9 (page 91) was the only reference to the parking problems in the area. Mr. Sin noted that it was also addressed under major issues in regulation 6. Doug Schmitz, City Manager, indicated that this was a compromise between making a policy versus a recommended action measure (RAM). Mr. Sin confirmed that the neighborhood did this before the subcommittee formation. Mayor Hammerstad mentioned the public hearing on February 5. 3.4 Planning Commission Recommendation for Approval of Density Guidelines (ZC 7-98) Jane Heisler, Community Planning Manager, reviewed the history of the density guidelines, starting in 1996 with the adoption by Metro of its Urban Growth Management Functional Plan that required all cities and counties to change their Comprehensive Plans and Zoning Codes to meet the Functional Plan requirements. She mentioned that many of those requirements did result in more efficient use of urban land, the infrastructure, transportation system and open space as a preventative against the expansion of the urban growth boundary. Ms. Heisler mentioned the City Council's 1997 adoption of regulating language for R-3 and R-5 zones, which the proposed amendment deleted because it applied to lots created by subdivision or by partition. She explained that later Metro explained that the minimum that the City had to do to meet its requirements was apply the guidelines to subdivisions, which the proposed amendment did. Ms. Heisler noted that the second proposal in 1999 to apply the guidelines to the rest of the residential zones including applying minimum density to any proposed lot with a minimum of a half acre size. She recalled that Council asked staff to meet with Metro to discuss the City's options and a possible exception; Metro did not find an exception feasible because the City could not meet its density targets within the city limits. City Council Study Session Minutes Page 6 of 13 January 8, 2002 '( b Ms. Heisler indicated that this proposal, heard by the Planning Commission on November 14, 2001, did what Council requested by justifying application of the guidelines to subdivisions. She noted the Planning Commission findings (Exhibit A, pages 115 — 116). She reviewed the arguments that the Commission heard during public testimony. She summarized the Commission's response to the testimony as the City was trying to do its part in terms of regional goals, and that long-range planning involved looking at the future. Ms. Heisler mentioned that staff originally proposed not including the R-2, R-0 and DD zones because those three zones based the maximum number of units on floor area ratio rather than on minimum lot sizes. She explained that staff put them back in when Metro argued that the City was not dealing with all its residential zones. She observed that doing so was also more in keeping with the Council's direction to apply the minimum density requirements to subdivisions. Ms. Heisler mentioned the Commission's concern that a property owner could circumvent the minimum density requirements through a series of partitions over more than one calendar year. She discussed the Commission's solution of requiring a `future development plan,' by which the City would not lose the opportunity for minimum density on the entire parcel. Ms. Heisler used an overhead projector graphic to demonstrate how the future development plan worked. She described a scenario of a person applying to partition into two lots, land that was four times the minimum lot size. The person would draw up a future development plan that showed how the parcel could be developed at minimum density over time; the City would record the notice of the future development plan so that any property owner would know about it as well as the City, and both could use it as a guide for future development. Ms. Heisler described another scenario of a property owner with a lot with an existing house on it who wanted to partition it into two lots and build another house; he/she had to locate the house on the second lot in such a manner that it would not preclude the future partitioning of the remaining lot. Councilor Turchi asked if this requirement precluded a property owner with two acres of land from partitioning his/her property to give half to his/her children to build a house on and use the other half to build his/her dream house, nestled in the trees in the center of the property. Ms. Heisler agreed that there was a potential for this requirement to impose a size restriction and a location restriction on homes, even if the property was not ever subdivided. Mr. Vizzini concurred, arguing that the zone itself established the restriction because it determined how many lots could occupy the space, as well as the building envelope through setbacks. Ms. Heisler confirmed to Councilor Turchi that a person building on Lot 2 would have to pick out which of the potentially available lots he/she would put his/her house on. She concurred that a dream house could not be located in the woods in the center of the property. Councilor Turchi commented that this was different from his general notion of minimum density, which has been that it was not a big deal, as a person could partition his/her property into three lots. He pointed out that this proposal allowed the partitioning into three lots but then required building on the property as though it were a subdivision. Mr. Vizzini stated that a person had to build in keeping with the zone. Mr. Vizzini described the friction as arising from saying, on one hand, that the property owner needed to plat his/her property according to the zone requirements, and on the other, that he/she could not build on multiples of the lots once they were platted, because that meant building incompatibly with the zone. He argued that trying to put a building that normally fit on an R-10 zone in an R-5 zone raised neighborhood compatibility issues. He commented that he heard concern about the idea that people could not build across lots, once they were platted, and that this proposal required the building envelope to fit within a single lot on the plat. City Council Study Session Minutes Page 7 of 13 January 8, 2002 7 r�� Councilor Turchi said that he understood that intellectually but he had a problem with the larger pieces of land in Forest Highlands. He observed that many Forest Highlands property owners only wanted to partition their land to build a second house on it; they did not want to subdivide. He argued that this requirement did not allow them to partition their property and use it as though it were a one-acre lot. Mayor Hammerstad referenced the Atherton Heights development on Derby Street. She pointed out that the developer did cluster the houses towards the front of the five acres, thus leaving the back land for future development, which was a good decision in light of preserving the urban growth boundary. She held that it would have been a better decision if it had been a rule. Mr. Vizzini mentioned another possibility of not dividing the property but simply placing a secondary structure on the acreage. Councilor Turchi commented that he supported the urban growth boundary and Lake Oswego taking its fair share of growth and development in the Portland metro area but he wanted to be sure that he understood the ramifications of the proposal. Ms. Heisler concluded that the language stating 'two lots' meant that her idea of building a secondary dwelling unit within the square footage of the home or as an accessory structure would not work. Mr. Powell discussed the concern of the Forest Highland property owners, who were not as interested in building secondary dwelling units on the same lot, as they were in partitioning the land and giving half of it to their children. He observed that clearly the Council had a difficult choice. The Council could either go strictly with Metro's minimum requirements and allow the opportunity for serial partitions to get around the minimum density requirement or it could use the Commission's ingenious solution of requiring a shadow plat for partitions. Mayor Hammerstad held that, from a practical standpoint, the market would drive the issue. She argued that property owners would put the maximum number of dwelling units possible on the land in order to achieve the maximum profit in the long run. She pointed out that Lake Oswego was already developing at more than 80% density. Councilor McPeak observed that one reason why the Council let this subject simmer as long as it has was because of its lack of welcome by possibly the majority of the Council. She concurred that the Council overall supported the concept of the urban growth boundary, which she did not want to expand more rapidly than necessary. She stated that she would wait to be convinced that this was a good idea. Councilor McPeak argued that if they made this change for the small number of likely serial partitions, they would be adding to a controversial solution. She described the idea as `difficult to defend.' She said that she found it hard to support the idea at this time. She held that, in trying to achieve this perfectly efficient use of land, the Council could harm its chances of achieving a good but not perfect use of land. Councilor McPeak stated that if Metro did not ask this of the Council, then she was not yet convinced that they should ask it of themselves. She held that the gains were small and the negatives were large. Ms. Heisler put up a graphic showing what other communities have done. She noted that some cities have achieved 50% minimum density because they were so close to meeting their targets while others have included partitions because they could not meet their targets if they restricted it to subdivisions. Mr. Lashbrook presented the research staff did per Council's request this morning. He reported that there were four jurisdictions still pending before Metro on compliance with this issue: Lake Oswego, Oregon City, Durham and Multnomah County. He indicated that Oregon City was still City Council Study Session Minutes Page 8 of 13 January 8, 2002 working on it, Durham asked for an extension because it did not want to do it, and Multnomah County was doing it through a participatory process with its cities. Ms. Heisler clarified that Multnomah County did not provide urban services; therefore, it used an intergovernmental agreement process with its cities to achieve compliance, which it needed to finish. Mr. Lashbrook reviewed the three questions he asked of individuals at each of the cities, including whether they applied it to land partitions and whether they had a method of phasing it in. He noted that, while most of the cities were already doing more than the minimum Metro requirements, they were not all doing them the same. Councilor Schoen concurred with Councilor McPeak's comments. He commented that he had come in with the understanding that the City would not apply minimum density to partitions. He stated that he could not support the proposal. He spoke to doing what Metro required the City to do, which would be an easier sell. He recalled that the number of developable parcels in the city were not enough to create a battle over partitions versus future development plans for partitions. Mayor Hammerstad commented that if this provision was going to be a fatal flaw in the support of the ordinance, then the Council wanted to see an ordinance with this part deleted. Councilor Hoffman asked what problem the City was trying to solve with the future development plan. Mr. Lashbrook summarized the comments of Mr. Johnson and Mr. Sandblast, the two Planning Commissioners most strongly supporting the future development plan. He indicated that these two gentlemen have been around the business long enough to have seen developers using a series of partitions to get around subdivision requirements. He mentioned a scenario of a developer asking for a two-lot partition on December 30 and another two-lot partition two weeks later. Mr. Vizzini clarified that the Commission thought it unfair to allow two different standards for identical properties abutting each other. He noted that one coming under the subdivision requirements had one set of standards while the other coming under a series of partitions had another set of standards, which reeked of unfair application of the requirements. Mr. Vizzini indicated that he did not see this as an issue of Metro compliance but rather as a logical extension of the zoning map. He argued that the Comprehensive Plan and Zoning Map established a given area of town for development at a certain density level, which also achieved neighborhood compatibility. Mr. Vizzini pointed out that this proposal did not apply to all partitions but only those that met the four times the minimum lot size requirement. He emphasized that they were not talking about small lots dividable into two to three parcels but only lots large enough to divide into four or more parcels. He mentioned that this issue was personal to him because of the situation on the large parcel in back of his house, in which the property owner built a large house that was incompatible with the neighborhood and proposed dividing the property in two and building a second incompatible house. Mr. Vizzini cited the development behind his house as an example of the problem that could result from serial partitioning. He conceded that looking at the situation in terms of an owner wanting to give his/her children a piece of the property was one way to look at it. He argued that another way was to see that serial partitioning allowed the opportunity for incompatible developments that were at odds with the underlying zone and the Comprehensive Plan. Mayor Hammerstad described a scenario, using the graphic, in which a property owner demolished a little house on his/her land and built a big house under the County standards. Then the owner wanted to annex into the City and subdivide, which presented a problem because of the house location. She held that this was happening along the major streets, especially in Forest Highlands, where a huge house took up a large amount of land and made it almost impossible to put in development compatible with the neighborhood. City Council Study Session Minutes Page 9 of 13 January 8, 2002 81 Mayor Hammerstad argued that they could prevent this scenario by using the shadow platting, so that they knew where the house could go. She spoke of doing an intergovernmental agreement with the County with respect to the minimum density requirements for the region. Mayor Hammerstad concurred with Councilor Turchi that for these examples, the market was not working. Councilor McPeak referenced the Mayor's earlier comment that market forces supported the concept. She argued that zoning was supposed to put ultimate limits on the use of the land but not force people towards a limit. She held that minimum density did force people with respect to the use of the land, while zoning simply laid out the boundaries. Councilor Hoffman disagreed, contending that zoning was a forced use of the land, regulations that came into existence because the market was not working. Councilor McPeak clarified that she was speaking of a single piece of property. She pointed out that zoning allowed a property owner to divide a large piece of property up into a certain number of pieces but it did not force the property owner to divide it. Mayor Hammerstad conceded the point but argued that minimum density did not force anything either. Councilor McPeak disagreed, arguing that a shadow plat prohibited a property owner from building a big house. She said that zoning currently allowed a person to have one house on a big piece of land. She contended that the shadow plat added another restriction on the land use by saying that the property owner could not build a big house on that piece of land. Mr. Vizzini pointed out that the restriction was what was allowed in the zone. Councilor McPeak reiterated that zoning was not intended to force that,rather it limited a lot to a certain size under the zoning and allowed the property owner to build up to whatever the zone allowed. Councilor Hoffman agreed, commenting that zoning forced the size of the building as well as the type of development. Councilor McPeak argued that this went beyond that. Mr. Vizzini pointed out that the Mayor's scenario used an undivided lot with the dream house built on the back of the lot; then the owner came into the city in order to divide the lot. He described the situation as a `grandfathered situation,' in asking the question of what did the minimum density rule require of the property owner when he/she came into the city to divide the land. Mr. Vizzini mentioned his and Ms. Heisler's search through the exceptions to see if, under this circumstance, the owner could divide the remaining property into fewer lots than otherwise would be required under the zone. He noted that the location and size of the house precluded the full subdivision of the land per the zone requirements because there was not enough room to meet the setback requirements. Mr. Vizzini pointed out that there was a loophole in the way the ordinance was written, which could be codified by adding an exception under Sec 48.57.15: in cases where there was a pre- existing structure and insufficient land to meet the minimum requirement, then one divided the land up to the maximum extent possible under the zone. Councilor Schoen asked if the reality was that people would develop to the County standards before annexing to the city. He argued that this put an unnecessary restriction on the use of the land. Councilor McPeak asked if the City could put a timing regulation that prohibited partitions closer than one year apart. Mr. Powell noted that Metro used the state law definitions of partitions and subdivisions. He conceded that there might be some opportunity for the City to make that kind of a regulation, as long as it used the same terminology and applied it at least to subdivisions. He indicated that Metro would not prohibit the City from applying it to partitions beyond the definition of subdivision. Mr. Vizzini argued that this was not about restricting the use of someone's property; only a partition or subdivision of the property triggered this provision. He held that a person could develop a dream house on his/her property at any time under the current rules and these proposed City Council Study Session Minutes Page 10 of 13 January 8, 2002 82 rules. He described this as an issue about land subdivision based on the zone, and not about development. Councilor Rohde described how one could get around the minimum density requirement under the Mayor's scenario by using a lot line adjustment. Mr. Sin concurred that there were loopholes people could use to get around the rules. Councilor McPeak mentioned that there were some property owners who were families in which the senior members of the family owned a big piece of land, which served as their retirement nest egg or which they could give to their children. She held that a partition was their route. She argued that the City limited their use of their property by allowing a partition into two lots but not allowing them to use the property as they wished; instead, they had to site houses in a way that fit in with the ultimate use of the land in the future. She reiterated that she saw that as a big restriction. Mr. Vizzini concurred that it was. Councilor Rohde held that a property owner could do that, under the scenario he just suggested. Mr. Vizzini said that the issue for him was what tools did they have in place to realize the Comprehensive Plan and the Zoning Map that flowed from it. He asked how to address the demand in the community to protect neighborhood character without the tools in place to do so. He argued that the most essential tool was the zone. Mr. Vizzini spoke of the incompatibilities that resulted from not following the zone. He asked why they went through the effort of the Comprehensive Plan and Zoning Map if they did not use it as a blueprint for development. He argued that this was about developing the tools to ensure that the City used the Plan and Map as a blueprint. Councilor McPeak observed that Mr. Vizzini spoke of ensuring it while she spoke of allowing it. Mr. Vizzini argued that a similar tool was street connectivity. The City required developers to go through that in order to ensure that they developed in a manner that was in keeping with the goals and blueprint for the community. He contended that, without the blueprint, they would see the hodge-podge development of East Portland. Mr. Vizzini concurred with Councilor Graham that the compatibility question was an issue. Mayor Hammerstad agreed,pointing out that allowing two houses on a 1.5-acre piece of land in an R-7.5 zone, which were larger than what was allowed in an R-15 zone, eliminated the zoning pattern. Councilor Schoen said that he was looking for the simplest requirement. He held that creating a situation in which people had to figure out how to get around the requirement was an unhealthy way to develop land. He reiterated that if Metro required a minimum density requirement, then they should do what Metro required. Mayor Hammerstad noted the public hearing on January 15 and the deliberation and decision on February 5. She indicated that they would leave the record open for a week and a half for written comments. Councilor Rohde asked staff to provide a colored map showing the large pieces of land within the City's urban services boundary. He held that that information made it clear why Forest Highlands became so upset over this issue, considering that its R-20 County zone translated to an R-7.5 zone in the city. Ms. Heisler presented a map showing that information. She concurred that Forest Highlands was the neighborhood outside the city limits most impacted by these guidelines. Councilor Turchi asked if the piecemeal annexation and development in the Forest Highlands area resulted in inefficient engineering of City services,perhaps having to go around County land and costing the taxpayers money. Ms. Heisler indicated no, noting that provision of services was primarily 'pay as you go.' Mr. Lashbrook clarified that if all that land had been in City Council Study Session Minutes Page 11 of 13 January 8, 2002 83 the city 30 years ago, the City could have provided the services more efficiently, as the land was topographically challenging. Mayor Hammerstad mentioned the exceptions to minimum density requirements (page 120). She discussed her concern about the effect on development of density transfers for publicly owned open space. She commented that the City has purchased a significant amount of open space in the Stafford area or it might purchase open space in other areas. She pointed out that a density transfer for the open space meant developing the rest of the area as multi-family. Mayor Hammerstad mentioned an upcoming Metro subcommittee that would be looking at taking open space out of the inventory of developable land, which she wanted to sit on. She wondered if they could state in the ordinance that publicly owned open space was not subject to density transfer. She pointed out that, with a movement of the urban growth boundary, the productivity of Stafford came in at a certain number of units without the consideration of open space; that number became Lake Oswego's target, which it could not meet with density transfers for open space. Mayor Hammerstad spoke of two lines of defense: getting on the committee and exempting publicly owned open space from density transfers. Councilor Schoen asked if that would include watersheds and sensitive lands. He observed that by the time they took everything out of Stafford, there was not as much developable land left as everyone thought. Mr. Powell indicated that he did not think that it would hurt anything to add it in. Mayor Hammerstad asked staff to do so. Councilor Graham questioned whether Metro would disallow Lake Oswego superceding its rules when it came down to the final crunch. Mayor Hammerstad pointed out that open space was a value that Metro was looking for within the urban growth boundary. Councilor Schoen asked if Metro would require density transfer for sensitive lands. Mayor Hammerstad indicated that Metro did not require it but the City has taken it out. Councilor Hoffman indicated that his only concern with the ordinance was the future development plan. He said that he understood that people were trying to ensure that any development was consistent with the zone, which was why zoning was a planning tool; if the City believed that R-7.5 was the right zone in an area, then it should not allow someone to split a 20,000 square foot lot into two 10,000 square foot lots. He noted that they were trying to get development that matched the neighborhood. Ms. Heisler indicated to Councilor McPeak that the map showing the actual number of acres affected by the ordinance has changed, and staff would provide the Council with an updated map. Mayor Hammerstad requested colored maps for the packets, including an updated unincorporated area map. 4. OTHER BUSINESS Mr. Lashbrook introduced Denny Egner, the new Long Range Planning Manager. Mr. Vizzini thanked the Council for the opportunity to speak. Mayor Hammerstad asked the Council to allow a reduction in the testimony time limits for minimum density from 10 minutes for neighborhood associations and 5 minutes for individuals to 5 minutes and three minutes respectively. Councilor Rohde disagreed with reducing it. Councilor Turchi moved to reduce the testimony time limits to 5 minutes for neighborhood associations and 3 minutes for individuals. Councilor Schoen seconded the motion. Mayor Hammerstad explained that by restricting the testimony to those time limits and leaving the record open for written comment, she hoped to move things along in an expeditious manner. City Council Study Session Minutes Page 12 of 13 January 8, 2002 84 Councilor Hoffman concurred with Councilor Rohde that they should not reduce the time limits. He pointed out that this was the only chance for these people to speak and it was an important issue to some. Mr. Lashbrook suggested allowing those who felt cut off by the time limits to speak again at the end. He observed that not many stuck around. Councilor Hoffman said that was fine. Mr. Vizzini mentioned that Mayor Katz of Portland,upon hearing the same testimony for the fifth time, would ask for a show of hands from the audience in support of the comments and then ask that folks not take up additional time stating what has already been stated. He concurred that there was a civic engagement issue but held that the Council also did not need to listen to the same thing repeatedly. Councilor Turchi withdrew his motion. 5. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 8:00 p.m. Respectfully submitted, �i1�1✓L(dil.(I1J Robyn Chr tie City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Study Session Minutes Page 13 of 13 January 8, 2002 8J b6 4.3.6 02/05/02 MINUTES OF JANUARY 15, 2002 MORNING MEETING 87 `/�`LAKE°sw� `° CITY COUNCIL MORNING MEETING MINUTES January 15, 2002 .O EGOI Mayor Judie Hammerstad called the special City Council meeting to order at 7:34 a.m. on January 15, 2002, in the City Council Chambers. Present: Mayor Hammerstad, Councilors Turchi, Graham, McPeak, Hoffman, Rohde and Schoen. Staff Present: Doug Schmitz, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Janice Deardorff, Human Resources Director; Stephan Lashbrook, Community Development Director; Joel Komarek, Interim City Engineer; Richard Seals, Financial Planning Manager; Jane Heisler, Associate Planner; Chris Jordan, Assistant City Manager 3. REVIEW EVENING AGENDA Mayor Hammerstad asked Councilor McPeak to review the consent agenda this evening. She mentioned the presentation of The First 90 Years of Herald and Virginia Campbell, compiled by Patricia Rovainen, to the library. The Council asked staff to provide a clarifying explanation of Item 5.1.1, the contract award, tonight. Mayor Hammerstad noted two corrections to the minutes: • p. 51, 6th paragraph, change "Lake Oswego as the last city" to "Lake Oswego as one of the last cities" • p. 52, 6th paragraph, change"zoning density"to "zoning" Item 8.1 Density Guidelines Mayor Hammerstad mentioned that she asked for clarification on the relationship of the numbers in the analysis of parcels subject to the minimum density of partitions (page 171). Stephan Lashbrook, Community Development Director, indicated that staff would clarify the numbers this evening. Councilor Rohde suggested that Mayor Hammerstad make it clear to the citizens at the hearing tonight that only one person could speak as the neighborhood representative for the ten minutes, as there has been confusion about that in the past. Mayor Hammerstad indicated that she would also clarify that they would strictly adhere to the testimony time limits. Mayor Hammerstad explained to the Council that her intent tonight was for the Council to ask questions, get additional information or deliberate but it would not make a decision. She said that at the subsequent meeting, the Council would deliberate, discuss and vote but there would be no public testimony. She indicated to Councilor McPeak that tonight was the best time to make an amendment, although a Councilor could do so on the night that the Council made the decision. She pointed out that they would need to take testimony again on any substantive changes. Mayor Hammerstad indicated to Mr. Lashbrook that she intended to leave the record open for one week for written testimony. She commented that she thought that this process gave them the opportunity to give thoughtful consideration to the issues and to be clear about what the Council wanted to do. Mayor Hammerstad mentioned that the City received a letter from OLCC regarding applications for liquor licenses, stating that Lake Oswego's process was fine (Item 8.2). City Council Morning Meeting Minutes Page 1 of 8 January 15, 2002 Item 9.1 Information from the Council Doug Schmitz, City Manager, clarified to Councilor Graham that Phase 3 (Item 9.1.1, page 220) had no funding and staff has not scheduled it. He confirmed that Phase 1 of the recommendation was taking out the crosswalk and the orange crossing flags. Mayor Hammerstad indicated that they would want to discuss that this evening. Councilor Rohde mentioned that he had a JPACT report. Councilor Graham indicated that she had some items also. 4. REVIEW FUTURE AGENDA ITEMS Mayor Hammerstad observed that they were in the process of scheduling items discussed at the retreat. She recalled that during Mr. Schmitz's evaluation, they had talked about doing the 5 Traits of Leadership for the whole Council, but they did not discuss it at the retreat. Janice Deardorff, Human Resources Director, reported that the cost was just under $4,000 for the entire Council. Mayor Hammerstad spoke to this program as a training opportunity. She recalled the Council's discussion about some Councilors, who were not going to Washington, D.C., attending other meetings that the Council felt might be more valuable. Ms. Deardorff described the program as providing an individual profile of personality and management style. She observed that the consultant would also look at the Council's management style as a group, if all the Councilors participated, and give feedback on areas of strength and areas needing development. Mayor Hammerstad recommended that the Council go through the program. She said that they would write a proposal for Council's consideration at a future date. Mayor Hammerstad mentioned that Councilors McPeak and Graham would take the Hart House tour this week. Councilor Hoffman referenced an e-mail he received regarding the development at the Durham Quarry. He recalled their conversation at the retreat about the potential impacts of this development on Lake Grove. He asked staff to contact Tualatin and Washington County to get information on the plans, traffic studies and other retail information. He asked Mr. Lashbrook to summarize the information and report to the Council on the development, as well as giving his perspective on how it would affect the West End. Mr. Schmitz announced that last night the School Board continued the Lakeridge girls' softball field matter for 30 days in order to do a hydrology study on Sites 1 and 3. He indicated that this was acceptable to Mr. Wright, the OCR complainant, and to Mr. Powers, Development Review Board. Mr. Schmitz indicated to Councilor Rohde that the District was not under a court order to have this done by a certain date but they had wanted it online for the 2003 season. He observed that with the delays and the time it took for the sod to mature to playing level, it would take longer. He mentioned that Mr. Korach talked with OCR yesterday about the extension and was able to negotiate something acceptable. 5. OTHER BUSINESS 5.1 Management Compensation Methodologies Ms. Deardorff introduced Bill Erdle, Compensation Resources, LLC, a consultant who specialized in compensation and classification work. She mentioned that she has worked with Mr. Erdle since the 1980s. She noted that he did work at the City of Lake Oswego before her arrival, based on his reputation in working in the public sector. Ms. Deardorff mentioned that Mr. Erdle has been helping staff look at how to restructure the City's management compensation program, with a particular emphasis on finding a way to link City Council Morning Meeting Minutes Page 2 of 8 January 15, 2002 5U performance more tightly to compensation. She spoke of getting away from the annual cost of living adjustment, which was somewhat of a shell game played with other organizations. She noted that they could not get totally away from it because of the way that the market was set up. Ms. Deardorff spoke to discussing the issue of compensation philosophically this morning, following Mr. Erdle's presentation on compensation in general. Mr. Erdle gave a slide presentation (see handout, Compensation Overview). He reviewed the areas for discussion (page 2) and his background in industrial psychology and compensation (in both the public and private sectors). He mentioned that the main focus of the majority of programs that he set up was pay for performance, although he could set up whatever type of program an organization wanted. Mr. Erdle noted that compensation programs provided guidance for managerial pay decisions, supported organizational goals, insured fairness in the pay program and provided for both legal and regulatory compliance. He observed that the typical objectives for a compensation program were to attract, retain and motivate employees. Mr. Erdle discussed the two general areas of rewards in a compensation program: extrinsic and intrinsic. He described extrinsic rewards as base pay, benefits and any variable compensation while intrinsic rewards included recognition in the job, the work itself and the organizational working conditions. Mr. Erdle reviewed the factors to consider in setting up a compensation program. He mentioned internal equity (the perceived worth of a job relative to other jobs in the organization), external equity (the value of the job to similar jobs in other organizations), individual equity (how employees perceived their level of pay relative to other individuals), and process/program equity (the employee's perception of fairness in the organization's compensation program). Mr. Erdle recommended that organizations be open and explain their compensation programs clearly to their employees. He cited an example of an organization that had a good program but did not explain it clearly to its employees; consequently, the employees were suspicious about what was going on. Mr. Erdle mentioned other factors to consider(page 6), including performance and productivity incentives (motivating and rewarding higher levels of employee performance). He cautioned care in setting these up in order to avoid motivating or rewarding inappropriate behavior. He mentioned compliance with state and federal laws, ease and flexibility of program administration and cost-effectiveness. Mr. Erdle reviewed a diagram demonstrating the process an organization went through in determining what to pay an employee (page 7). He explained that job analysis involved information about what the job itself entailed(usually collected through questionnaires or interviews), which was followed by job documentation(writing up job descriptions). Mr. Erdle explained that the next two simultaneous steps - external pay comparison and internal job evaluation—involved identifying the appropriate markets for the various jobs outside the organization and determining the relative value of the job within the organization. He noted that internal job evaluation systems, which used four factors of skill, effort, responsibility and working conditions, were categorized as quantitative and non-quantitative (page 8). Mr. Erdle mentioned that the job ranking system(non-quantitative) was the oldest type of system and very simple. He commented that he called the quantitative systems `pseudo- scientific' because they were also subjective, although they gave the impression that they were not because they yielded a dollar value based on factors or points. He observed that all the systems yielded about the same results. City Council Morning Meeting Minutes Page 3 of 8 January 15, 2002 9i Mr. Erdle reviewed the next step, the internal and external reconciliation (page 10). He said that the result of the reconciliation, a job worth hierarchy, translated into salary ranges. Mr. Erdle reviewed an example of a salary structure using a 10%progression from mid-point to mid-point (page 12). He described the process as identifying the market, deciding where an organization wanted to pay in relation to the market, and setting up the salary structure to fit those factors. Mr. Erdle mentioned differences between the public and private sectors. The private sector typically set the market rate for the jobs within a pay grade at the mid-point, while the public sector typically set the market rate at the maximum point. The private sector kept an eye on the market rate annually and adjusted its structure accordingly in order to remain competitive, while the public sector was either behind the market at the end of the year(lag structure), at the market at the end of the year(lead structure) or at the market mid-year and behind the market at the end of the year(lead-lag structure) (page 13). The public sector went through the entire analysis considerably less frequently than the private sector. Mr. Erdle reviewed the different types of pay increases (page 14). He observed that across-the- board increases were becoming less popular among private organizations, as where cost-of- living increases, but the public sector and union contracts still used the cost-of-living increase. He indicated that step and promotional increases were used in both sectors. Mr. Erdle indicated that merit increases, or pay for performance, were the type of program that he usually set up. He noted that a good performance evaluation system was critical in a merit increase program. He observed that it was also a lot more work for an organization because of the time commitment to employee performance evaluation and setting goals, etc. Mr. Erdle reviewed the factors in maintaining a compensation program(page 15). He recalled that when the City of Vancouver went from an analysis and review of its pay structures every seven years to every two years, the number of employee complaints decreased significantly. Mr. Erdle indicated to Councilor Turchi that a supervisor could adequately supervise five to eight people and determine merit. He concurred that a Police Chief writing evaluations for 50 people and determining merit was in a difficult situation. He spoke to moving evaluations down to the supervisory ranks. Ms. Deardorff indicated that in Lake Oswego the sergeants and lieutenants did the employee evaluations; the Police Chief only did the captains and the administrative personnel who reported directly to him. Ms. Deardorff indicated to Councilor Turchi that a typical supervisor in the City supervised between five to eight people. She confirmed that Councilor Turchi's situation at the school district, where he supervised 53 people at an elementary school and wrote the merit evaluations, would not exist at the City. Councilor McPeak asked if there were guidelines to help define a market. She recalled that the City had to change the market it used when recruiting for a position. Ms. Deardorff indicated that the City changed from the metro local market (still used for the labor groups) to a statewide market. Mr. Erdle said that the guideline he used with the private sector was with whom was the organization competing with for its employees. He commented that the market was not necessarily the same industry, citing a high-tech company losing employees to a sports manufacturing company. He said that typically agencies gathered that information through exit interviews. Ms. Deardorff confirmed that the City did exit interviews and used the information in its analysis. Ms. Deardorff recounted what happened in the City's recruiting process for a Community Development Director. She recalled that they ended up identifying the top 10 cities in Oregon as their market. She observed that the market played itself out when Mark Schoening left for the City of Eugene (No. 2 in population in the state). City Council Morning Meeting Minutes Page 4 of 8 January 15, 2002 92 Councilor McPeak asked if the factors shifted fast or were predictable. Mr. Erdle said that sometimes they were. He spoke to re-evaluating every year whether the market was still the correct market, as some organizations would come in or drop out. Ms. Deardorff commented that Lake Oswego lost its fire fighters to Tualatin Valley Fire & Rescue and the City of Portland but it did not use those organizations as market comparators because that market was so high that the City could not compete. She concurred with Councilor McPeak that this was a case of a hierarchy of organizations and that Lake Oswego recognized where it fit in the hierarchy, instead of in a level of competition. Ms. Deardorff commented that Lake Oswego was an attractive employer within its current market, citing the 48 interviews for police officers this week. She mentioned that Lake Oswego has not taken a single position and used a different market than its typical market. She recalled that at the City of Portland, they had jobs in a hot skills market and used a private sector market for those jobs because that was whom they were competing against. Mr. Erdle suggested considering a different salary structure when using a different market, such as a structure that allowed employees to move along it at a different rate than others. Councilor Schoen asked how Mr. Erdle's system differed from the Hay system, which was based on accountability and decision-making. He observed that realistically Lake Oswego could not complete with Eugene. He commented that he had a difficult time with the merit increases, given the accountability issue and the budget as the biggest driving force in pay rates. Mr. Erdle indicated that he tended to shy away from the Hay system because it was complex, pseudo-scientific and required a large staff to administer. He said that he could include factors from it in the internal evaluation of jobs portion of a performance system. He spoke to creating a simple system that was easy to understand and use. He described the whole job ranking approach that he used successfully with Norm Thompson's in developing a pay structure. Mr. Erdle described how the salary range for a job (minimum to maximum) interacted with appraisal ratings (meets sometimes/new to job, meets, exceeds) to determine a pay increase tied directly to job performance level. He noted that studies have shown that people can only differentiate between three different levels of performance. Mr. Erdle said that this system gave managers a tool for figuring out what kind of increase to give and organizations a tool for budgeting for increases. He explained that once the organization knew what the employee performance levels were and where the employees were in the salary structure, then it could develop guidelines for giving increases. Councilor Rohde asked what an organization did when all the employees did a great job, exceeding expectations and warranting a 5% increase but the organization's revenues only increased 3% a year. Mr. Erdle discussed changing the expectations or criteria for the appraisal ratings, including getting the managers together to reach a consensus on rating employees. He mentioned `forced distribution,' which made make sure that there were a certain number of exceeds or meets. Mr. Erdle confirmed to Ms. Deardorff that forced distribution meant that not everyone would necessarily get an increase. Ms. Deardorff observed that the timing of bringing up this discussion was difficult in face of the budget crisis and the need to reduce personnel costs. She pointed out that they did need to maintain the City's compensation program in order not to lose people, which cost the City more money in the long run. Councilor Rohde clarified that he did not want to set up a program based on market and merit that set up unreasonable expectations in a restricted revenue environment. Ms. Deardorff concurred. City Council Morning Meeting Minutes Page 5 of 8 January 15, 2002 , Councilor Hoffman commented that staff's challenge might be to reduce managers. Ms. Deardorff concurred. She indicated that they did take advantage of opportunities not to fill positions vacated due to attrition. She mentioned that the Library Advisory Board felt that the reduction in the number of supervisors at the library resulted in an understaffed library. She observed that the Board did not consider that the library might have had too many supervisors for too long, and this reduction brought the City in line with where it needed to be. Councilor McPeak held that it was difficult to maintain a tough grading system, as organizations tended towards grade inflation. She asked if it was possible in the public sector to have an objective merit system. Mr. Erdle said that he did not know. He indicated that he did not know of any one in the public sector using merit, although that did not mean that no one was on the national level. Mr. Erdle indicated to Councilor Schoen that he would recommend removing the step system in a new system or moving to a combination system, which allowed rapid step movement during a training period. He mentioned seeing the combination system in the private sector. Ms. Deardorff referenced the handout"Year 2002 Compensation Program,"which outlined the transition steps staff intended to take during the year 2002. She noted that they would maintain the current step and pay program for 2002. She explained that the resolution for a 2% cost of living increase was before the Council today in order to keep the City on the market in the next year. Councilor Turchi asked why this program ran from January to January rather than with the fiscal year. Ms. Deardorff said that she understood the history behind that fact as there had been a desire 10 years ago to move the management non-represented group away from the collective bargaining effective dates, which ran with the fiscal year. Mr. Schmitz indicated to Mayor Hammerstad that he thought it was timely to pursue this option, as they have talked about making the transition for several years. Ms. Deardorff indicated that staff would work on developing the program over the next year and present it to Council; at that point, Council could consider the financial situation and decide whether to adopt it. She did not advise trying to sell widening the pay ranges to the public right now. She spoke to having concrete evidence that the City linked performance to the pay ranges before doing so. Mr. Erdle commented that the City could gradually move into the system, as the Metro Area Communications Commission did, and set the market at the mid-point. He mentioned his personal opinion that the public would be receptive to a merit system, as most people already worked under a pay for performance system. Ms. Deardorff discussed the other side of pay for performance, what happened when someone did not meet the performance criteria. She disagreed with the common perception that people in the public sector could not be gotten rid of. She argued that it took a commitment to more documentation and performance monitoring but it could happen. Ms. Deardorff asked for the Council's concurrence to start talking to the directors, managers and supervisors about their commitment to managing performance, setting performance criteria/standards and evaluating performance. She observed that right now the City's system was mixed in terms of doing performance reviews. She described it as a commitment to the Council and the public that the public would be happy to know what the City was doing as an organization. Councilor Graham asked if it was common in the public sector to give severance pay to an employee who clearly went beyond the rules. Ms. Deardorff said that it was not common in the past but she thought that it was becoming more common. Mr. Erdle concurred but pointed out that the City did not have to have a severance package at all. He mentioned seeing severance City Council Morning Meeting Minutes Page 6 of 8 January 15, 2002 9;I packages in layoff situations that were not due to the employee's performance, but not in a performance based system. Ms Deardorff mentioned that they were moving department heads into an 'at will' status, which meant that they were working 'at the will' of the City Manager. She explained that the contract typically provided for some sort of payment if they left the organization, although termination for cause would be a lesser payment. She indicated that they did not have that structure for the current supervisors, managers or other department heads but they set it up for new department heads. Ms. Deardorff observed that people were more litigious now than they have been in the past. She mentioned that it could cost the City less to settle a payment on an employee suing the City for whatever the employee felt he/she was owed than to go through the court process, which was time-consuming and expensive. She described it as an unfortunate cost of doing business today. Councilor Schoen asked if the City stated clearly in these contracts the 90 day and 120 day performance reviews, and the option to let the employee go in the event that their performance was unsatisfactory. Ms. Deardorff said yes. She mentioned a provision for an annual contract renewal that included a review. Ms. Deardorff indicated that their next management training for supervisors, managers and department heads would include performance management from a legal context as well as coaching in performance evaluation. Ms. Deardorff indicated to Councilor Schoen that they projected a cost of between $5,000 and $10,000 to develop the program. She said that she would come back with a more exact figure. She confirmed to Councilor Rohde that the cost was in the 2001/02 budget. The Council agreed by consensus to direct Ms. Deardorff to proceed with developing the program. Councilor Turchi moved to approve Resolution 02-05, adjusting management confidential salaries. Councilor McPeak seconded the motion. Ms. Deardorff clarified to Councilor Turchi that people would get a 2% increase plus a step increase (if they were in a position to get a step increase). Richard Seals, Financial Planning Manager, indicated to Councilor Turchi that the staff estimate of$100,000 for the salary increases included all related benefit increases. Ms. Deardorff clarified to Councilor Schoen that the City was not doing any additional salary adjustments in 2002, other than for those under Step 5 who were eligible for a merit increase; a merit increase became effective on the employee's anniversary date. She confirmed that charter officers were not included in this program. A voice vote was taken and the motion passed with Mayor Hammerstad, Councilors Turchi, Graham, McPeak, Hoffman, Rohde and Schoen voting in favor. [7-0] 6. EXECUTIVE SESSION Mayor Hammerstad recessed the meeting at 8:50 a.m. to Executive Session pursuant to ORS 192.660(1)(a), consider the employment of a public officer or the evaluation of a public officer. David Powell, City Attorney, reviewed the Executive Session parameters. 7. RETURN TO OPEN SESSION Mayor Hammerstad reconvened the morning meeting at 8:53 a.m. Councilor Schoen moved to adjust the municipal judge's salary by 2%. Councilor McPeak seconded the motion. A voice vote was taken and the motion passed with Mayor City Council Morning Meeting Minutes Page 7 of 8 January 15, 2002 9J Hammerstad, Councilors Turchi, Graham, McPeak, Hoffman, Rohde and Schoen voting in favor. 17-0] 8. ADJOURNMENT Mayor Hammerstad adjourned the meeting at 8:55 a.m. Respectfully submitted, .V0- 300tGat)2.1- Robyn Chritie City Recorder APPROVED BY THE CITY COUNCIL: ON Judie Hammerstad, Mayor City Council Morning Meeting Minutes Page 8 of 8 January 15, 2002 96