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FCM20111011 CITY OF MUSKEGO Approved 10/25/2011 FINANCE COMMITTEE MINUTES Tuesday, October 11, 2011 Muskego City Hall Mayor Chiaverotti called the meeting to order at 5:30 p.m. Committee Members Ald. Schaumberg and Werner were present as well as Finance and Administration Director Mueller and Deputy Clerk Blenski. Committee Member Ald. Fiedler was absent. Also present: Parks & Recreation Director Anderson, Community Development Director Muenkel, Ald. Snead and Borgman. Ald. Harenda and Soltysiak arrived at 5:40 p.m. Those present recited the Pledge of Allegiance. The Deputy Clerk noted that the meeting was noticed in accordance with the Open Meeting Law. APPROVAL OF MINUTES Ald. Schaumberg moved for approval of the minutes of September 27, 2011. Ald. Werner seconded; motion carried. LICENSE APPROVALS Operators Ald. Werner moved to recommend approval of an Operator’s License for Linda Reinke, Suzette Roushia and Robert Skinner subject to the licensing requirements being completed prior to issuance. Ald. Schaumberg seconded; motion carried. Temporary “Class B” License for Friends of the Muskego Public Library An application was submitted on behalf of the Friends of the Muskego Public Library for the “Murder and Mayhem” event to be held on November 11, 2011. Ald. Schaumberg moved to recommend approval of a Temporary License for the Sale of Fermented Malt Beverages and Wine for the Friends of the Muskego Public Library for November 11, 2011. Ald. Werner seconded; motion carried. NEW BUSINESS Recommendation Regarding Initiating the Process for the Potential City Purchase of Boxhorn Launch Mr. Anderson stated the Parks and Recreation Board is recommending that the City pursue acquisition of the Boxhorn Boat Launch. The City has attempted to acquire the property or extend the lease for the past seven years. Ten years remain on the current lease. People would like to see public improvements made to the launch site. The Parks and Recreation Board has been reluctant to do that because funding from the DNR Waterways Commission is not available because the City has a current lease of less than 20 years. The owner of the property, Art Dumke, has indicated that he will reinvest the funds from the sale into the gun club, which he now owns. The cost for the appraisals should not exceed $10,000, which will come from Park Dedication funds. A letter of retroactivity from the DNR has been received, which will allow the City to apply for grant funding to defray the cost of the purchase. Mr. Anderson noted that the property owner has indicated that if the gun club does not remain viable, he will explore development of the property including the existing launch Finance Committee Meeting Page 2 October 11, 2011 area. This means it would not be available to the City. The City will pay approximately $32,000 in lease payments over the next ten years if the property is not purchased. Mr. Anderson stated that this is the best launch site on Big Muskego Lake. He also noted that 47 parking stalls are required for Big Muskego regardless of how many launch sites there are. The City is currently 17 stalls short. The Boxhorn site is not large enough to accommodate the total number of parking stalls required. This is why the grant received for the Durham Overflow Lot is important because it will provide the additional 17 stalls that are needed. Ald. Werner moved to recommend pursuing acquisition of the property. Ald. Schaumberg seconded; motion carried. Recommendation Regarding the Issuance and Sale of $2,750,000 Water System Revenue Refunding Bonds Ms. Mueller stated that a refinancing of three outstanding water revenue bonds is being proposed. This would result in a savings of approximately $392,000 because of low interest rates. Mr. Paul Thompson of Hutchinson, Shockey, Erley & Co. was present. He stated that the outstanding issues have various interest rates ranging from 4.79% to 5.8%. They can be refinanced with a new bond issue with an interest rate estimated to be 2.41%. The total savings of $392,236 is comprised of $80,000, which will come from the current reserve fund and $312,236 due to lower interest rates. Because of lower interest costs, the $80,000 is no longer needed in the reserve fund and can be applied to the outstanding principal amount. Ald. Schaumberg moved to recommend approval to move forward. Ald. Werner seconded; motion carried. Recommendation Regarding Issuance and Sale of $14,500,000 General Obligation Promissory Notes Ms. Mueller distributed the following itemization to reflect what projects the $14,500,000 will cover: COST 2011 2012 2013 TOTAL PROJECT Durham Drive $2,600,000 $300,000 $2,900,000 Janesville Road $1,385,900 $3,843,055 $1,835,000 $7,063,955 Pioneer Drive $80,000 $2,495,080 $2,575,080 Borst Property Purchase $1,243,648 $1,243,648 Borst Grant -$400,000 -$400,000 Boxhorn Launch $500,000 $500,000 Misc. Contingency* $617,317 $617,317 Total $5,409,548 $6,638,135 $2,452,317 $14,500,000 * Available funding for other future capital projects such as public safety radios, trails, flood related issue resolution, Lake property purchase, VFD truck, water tower tower painting . . . Or lowering the refunding amount. She noted that initially a borrowing of $15 million was anticipated. However, she and the Mayor reviewed the dollar amounts closer. The Mayor has recommended that the total amount be reduced by $500,000. Mr. Thompson stated this is a two year borrowing. He explained the State regulations regarding borrowing for a period of less than ten years, which allows the City flexibility in spending the funds. The short term Finance Committee Meeting Page 3 October 11, 2011 borrowing will also allow the City to take advantage of a declining future debt service payment on its current indebtedness. The interest rate is estimated to be 2%. Ald. Werner moved to recommend approval to move forward. Ald. Schaumberg seconded; motion carried. Mayor Chiaverotti thanked Sharon Mueller for reviewing the total amount to be borrowed so it could be reduced. Mr. Thompson noted that final interest rates will be presented at the October 25 Council meeting. Ms. Mueller stated the importance of moving forward with the borrowing as the City has substantial bills for some of the 2011 projects. Update Regarding Personnel Changes within the Library The Mayor stated that Library Board Present Josephine Scalzo was present. Mayor Chiaverotti noted that the Library Board recently accepted the resignation of Jane Genzel as Library Director. Ms. Genzel will resume her former position as Librarian III - Head of Reference and Adult Services. The Board will be working on hiring an interim director. Ms. Scalzo stated the Board has established a search committee to recruit a permanent library director. She stated that Tom Hennen, System Director of the Waukesha County Federated Library System, will also provide assistance. The Mayor thanked Ms. Scalzo for the time she has devoted to the library. Recommendation Regarding Developer’s Agreement for Steve Anderson Mr. Muenkel stated the Common Council already approved a certified survey map for the Anderson property on Tess Corners Drive. The Developer’s Agreement is for a small sewer extension. The agreement language is standard. Ald. Werner moved to recommend approval. Ald. Schaumberg seconded; motion carried. Recommendation Regarding Utility Easements on City-Owned Property Mayor Chiaverotti stated WE Energies has requested that the City convey easements for Library property and the retention pond property on Martin Drive. The easements are for the burial of overhead facilities for the Janesville Road Reconstruction project. Ald. Werner moved to recommend approval. Ald. Schaumberg seconded; motion carried. VOUCHER APPROVAL Ald. Schaumberg moved to recommend approval of Utility Vouchers in the amount $119,883.79. Ald. Werner seconded; motion carried. Ald. Schaumberg moved to recommend approval of General Vouchers in the amount $770,625.79. Ald. Werner seconded; motion carried. FINANCE DIRECTOR’S REPORT Ms. Mueller stated that she will need to spend time to prepare for the Moody’s call to determine the City’s bond rating. ADJOURNMENT Ald. Schaumberg moved to adjourn the meeting at 5:55 p.m. Ald. Werner seconded; motion carried. Minutes taken and transcribed by Jill Blenski, Deputy Clerk.