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07-24-1995 Minuteson 95-229 CITY OF SALINA, KANSAS REGULAR MEETING OF THE BOARD OF COMMISSIONERS July 24, 1995 4:00 p.m. The Regular Meeting of the Board of Commissioners met in the Commission Meeting Room, City -County Building, on Monday, July 24, 1995, at 4:00 p.m. There were present: Mayor John Divine, Chairman presiding Commissioner Abner Perney Commissioner Evelyn Maxwell Commissioner Peter F. Brungardt Commissioner Kristin M. Seaton comprising a quorum of the Board, also present: Absent: Greg Bengtson, City Attorney Dennis M. Kissinger, City Manager Judy D. Long, City Clerk None. CITIZEN FORUM Margaret Jilka, 224 East Minneapolis, spoke regarding the surfacing material for the new bike path. The Mayor noted that the Abilene Municipal Band will be at Oakdale Park on Saturday. The Mayor explained the new artwork on display in the new commission room. AWARDS - PROCLAMATIONS None. PUBLIC HEARINGS AND ITEMS SCHEDULED FOR A CERTAIN TIME None. CONSENT AGENDA (6.1) Approve the Minutes of the Regular Meeting of June 17, 1995. (6.2) Resolution Number 95-4892 directing and ordering a public hearing on the advisability of an improvement to Seitz Drive between Pheasant Lane and Crawford Street. Set the date of August 7, 1995 for public hearing. (6.3) Change Order Number 2 for the East Crawford Recreation Area Ball Field Lighting and Electrical System Improvement Project Number 94-905 in the net amount of $788.00. (6.4) An Ingress -Egress Agreement granting Harry Sinsabaugh access to a tract of land. Moved by Commissioner Brungardt, seconded by Commissioner Seaton, to approve all items on the consent agenda. Aye: (5) . Nay: (0) . Motion carried. DEVELOPMENT BUSINESS None. ADMINISTRATION (8.1) License agreement with Asbury -Salina Regional Medical Center and St. John's Regional Health Center to allow placement of communication cable in the public right-of-way. Shawn O'Leary, Assistant Director of Engineering and Utilities, explained the proposed license agreement. Action 95-230 Moved by Commissioner Seaton, seconded by Commissioner Maxwell, to adopt Resolution Number 95-4866, approving the license agreement with Asbury -Salina Regional Medical Center and Saint John's Regional Health Center. Aye: (5). Nay: (0). Motion carried. (8.2) Third reading Ordinance Number 95-9697 granting DS&O Rural Electric Cooperative Association, Inc. an electric franchise. Dennis Kissinger, City Manager, explained that there are two areas of North Salina currently in the City limits that appear on the KCC maps as DS&O territory. The areas were annexed in the 1960's and 19701s. One area was annexed before the retail electric law set up the territories and contains documents that indicate a transfer to KP&L. The second area was annexed after the law passed without a request for franchise from DS&O. The City's franchise agreement is with KP&L, however, the transfer to KP&L was not completed and the area is showing certification to DS&O. There are no customers in this second area. Mr. Kissinger clarified that the franchise being requested by DS&O is general and could raise the possibility of DS&O serving the area as it is still certified. This area is of a different type, commercial industrial. As with other cities, Salina has a limited amount of highway commercial industrial area along the interstate and developers can be sensitive to a variety of issues, including utility availability and costs. Asked if DS&O could have a rural and an urban rate structure, Mr. Kissinger believes they can, but was uncertain about the process. Jerry Rumbaugh, General Manager for DS&O, spoke regarding the North Salina situation. He informed the Commission that the North Salina impact would be determined by when the services were there, when the line was there or when the annexation took place relative to the certification of the territories. He explained that the basic premise of the certification process was that no utility would lose existing customers and that no Independently Owned Utility ( IOU) would lose sole certificated territory to that utility. He stated that upon inspection he located a DS&O power line with poles dated 1972, and poles dated 1975 by KP&L, both prior to the certification process. He shared his belief that DS&O should have received transmission rights only through that area as they had no meters and couldn't have served new customers if the process had been handled correctly at the time of the annexation. Mr. Kissinger, asked specifically that if the area is found to be in DS&O territory, if granted a franchise, DS&O would voluntarily turn that industrial area back to KP&L. Mr. Rumbaugh responded, "We would serve anything that comes along, certainly." He continued that if an error was made and DS&O has the potential to serve an area they will go after it. Mr. Kissinger clarified that this point is critical to today's Commission decision. Mr. Rumbaugh closed the discussion by stating that DS&O will discuss the situation in North Salina if they get the franchise. Mr. Rumbaugh went on to discuss rates, indicating that other areas have not been sensitive to electric utility rates. He advised the Commission that he spoke with the secretary of Lowell Miller, a developer in the Topeka area. The secretary had built a new home in an area served by KAW Valley and advised Mr. Rumbaugh that the subject of an option for electric service was not raised. Mr. Rumbaugh stated, "They chose the lot, their location and it turned out it was KAW Valley. " The rates for 750 kwh in that area are: KAW Valley $70.15, KP&L $48.37 and DS&O $61.60. As another example, Mr. Rumbaugh sited a discussion he had with a member of the Olathe Planning Services Department who had also built a new home in a dual franchise area. The Olathe representative did not think there was a difference in development based on rates, telling Mr. Rumbaugh that utilities haven't been a concern. Mr. Rumbaugh said that when he asked if rates would impact the representative's selection to purchase, the response was that if rates were three times higher maybe, but not for just a couple dollars. The Olathe rates for 750 kwh are: KCPL $60.55, KP&L $48.37, and DS&O $61.60. Mr. Rumbaugh continued by identifying 127 new homes within the DS&O territory since January 1992. He gave a brief history of electric co-ops and compared the cost to a new home owner to place electric service. He ction stated that the cost of hooking up a new home with KP&L was $1,000 compared to $100 with DS&O based upon the different philosophies of the utility companies. He shared the impact this would have on a customers' mortgage payment, $9.50 a month. In closing, Mr. Rumbaugh stated that DS&O thinks that the certified areas are their's to serve and that rates won't impact development. Mr. Frank Norton, 2524 East Magnolia Road, spoke regarding the amount of rebate from DS&O. He stated that a bill of $22,000 per year received a rebate of $48.00 each year. Mr. Norton said someone would pay to put the cable underground. He felt it should be paid by the developer and not spread between users. In response to Commissioner Maxwell's question about what impact this would have for a developer of more affordable sized lots and sized homes, Mr. Norton asked to be treated the same as other Salina developers. Commissioner Perney responded: "I might answer the question. I have more experience with low income housing than anyone else in the City, I believe. Now I feel that in my experience it's the monthly operating costs that is the most critical factor. The initial cost is not what makes an affordable house affordable. It's what it costs to stay there and the difference on the front end costs and how they are financed does not even by Mr. Rumbaugh's explanation, does not bring you the final answer. The final answer includes the utility costs that you have have to pay each and every month. So I am concerned that if DS&O were granted the franchise and it really doesn't relate to the current subdivision - Mr. Norton's subdivision so much because it is going to be high cost. But I am concerned that if DS&O is granted the franchise it will limit the possibility for future affordable housing, particularly on the east side of town, perhaps on the north also. And, I think to have DS&O in as a second utility company . " In response to Mayor Divine's question, the Commission then discussed with the City Manager and the City Attorney the consequences of refusal by KP&L to serve if the DS&O franchise is not granted. In response to Commissioner Maxwell's question, the City Manager related his discussions with KCC staff regarding how the KCC would view any appeal by DS&O arising from the City's denial of the franchise application. Mayor Divine stated his position: "I am concerned about the North Salina at this time, and not having a clear understanding, and I think it clouds the issue related to what is in DS&O's franchise and what is not, so I will be voting to deny the franchise at this time." Commissioner Brungardt stated his position: "Mr. Mayor, the rural electrification notion and idea that no one should be without service of course dates back many years as we have heard, and I think the KCC's idea of how to apportion that service and the way they drew the map is kind of self-evident, they just wanted to make sure that it happened and in some kind of fashion. Cities, however, organize things a little differently than the rural areas. Cities have their own point of view on this issue that doesn't really share anything with the electric company or the co-op, or the developer, or KP&L, or anybody else. Cities are very, very concerned about fringe development, about areas that want to be like the city, that have the same services, that want to enjoy the same amenities, but don't want to be in the City. That is an ongoing problem for us as it is for all municipalities. It is often without solution, frankly. But it remains a very big problem for us in the organization of our growth and the attraction of orderly growth and the kind of development we would like to see. Mr. Norton's subdivision actually lends itself when you inspect it as kind of a rural development. You look at it and say 'Gee, maybe that fits a DS&O concept.' Except that this Commission has agreed to annex it within the City of Salina, and if it is part of the City of Salina, I think that it is incumbent upon us to offer a uniform blanket or level of services and a like type of activity that you would see anywhere else within the city limits of Salina. I share Mayor Divine's comments also that looking ahead particularly with the idea of increased commercial or industrial development in some of these areas that also lends a little impetus to the notion that Salina has got to keep its options open and its ability to offer pretty much the same level of services wherever anybody goes within the City of Salina. For that reason, I also will vote to deny the franchise." Commissioner Seaton stated her position: "I will also vote to deny on the franchise. I am fairly confident that the land between the city limits and I. the proposed annexed area for Mr. Norton's property will also end up being developed and be annexed into the City. I think it would be most consistent to continue the services provided by KP&L and I think that is just a better I, choice at this time." Commissioner Maxwell stated her position: "I am very concerned about having affordable housing options as large as we can get them and I think in terms of this particular development that if people wanted to move there at $10 or $12 difference between their actual usage would not make any difference, but I do want to maintain the option of having more affordable monthly payments for their utilities and I think that any cost breaks that go to the country should go to the agricultural folks and not to rural residents who are there for other reasons, so I too will vote to deny the franchise." I 95-231 Moved by Commissioner Brungardt, seconded by Commissioner Maxwell, that the DS&O application for an electric franchise in Salina be denied. Further comment by Commissioner Maxwell: "I would like to make also a comment that from the materials that have been provided by staff there are ! five reasons in the supplementary (staff report) and I believe that in our city j in the reasons that I have stated that in our city the subdivision or the j developmental process does meet all of those criteria that have been laid out by II staff and would like to be considered as part of the motion." I Commissioner Brungardt consented to agree to put that in the context of the motion. It was then clarified that a vote in favor of the motion would have the same effect as a vote to defeat Ordinance Number 95-9697 on third reading. I �A roll call vote was taken. Aye: (5), Perney, Maxwell, Brungardt, Seaton, Divine. Nay: (0). Motion carried. i (8.3) Second reading of Charter Ordinance Number 27, exempting the City of Salina from the provisions of K.S.A. 13-1017, as amended. Dennis Kissinger, City Manager, explained the the purpose of the Charter Ordinance. (8.4) First reading of Ordinance Number 95-9699, establishing procedures for public improvement construction and modification. I Dennis Kissinger, City Manager, explained Ordinance Number 95-9699 which sets the public improvement procedures for the City. 95-232 Moved by Commissioner Perney, seconded by Commissioner Maxwell, to approve Charter Ordinance 27. A roll call vote was taken. Aye: (5), Perney, Maxwell, Brungardt, Seaton, Divine. Nay: (0). Motion carried. 95-233 Moved by Commissioner Maxwell, seconded by Commissioner Perney, to approve Ordinance Number 95-9699 for first reading. Aye: (5). Nay: (0). Motion carried. (8.5) Approval of the Notice of Hearing for the 1996 Budget and setting a hearing date of August 14, 1995. Bob Biles, Director of Finance and Administration, explained that this will be published Friday and the hearing will be August 14, 1995. 95-234 Moved by Commissioner Maxwell, seconded by Commissioner Seaton, to approve the Notice of Hearing for the 1996 Budget. Aye: (5) . Nay: (0) . Motion carried. (8.6) First reading Ordinance Number 95-9698 amending Chapter 23 of the Salina Code pertaining to Municipal Court and repealing the existing chapter. Judy Long, City Clerk, explained the amendment to Chapter 23 of the Salina Code. 95-235 Moved by Commissioner Brungardt, seconded by Commissioner Seaton, to approve Ordinance Number 95-9698 for first reading. Aye: (5). Nay: (0) . Motion carried. (8.7) Award contract for Gypsum Hill Water Tower Painting Project Number ction 94-912 to Loyd's of Kern Painting Co., in the amount of $224,400. Don Hoff, Director of Engineering and Utilities, explained the painting project. I 95-236 Moved by Commissioner Seaton, seconded by Commissioner Brungardt, to award the contract for painting the Gypsum Hill Water Tower to Loyd's of Kern Painting Company in the amount of $224,400. Aye: (5). Nay: (0) . Motion carried. (8.8) Change Order Number 3 for the 1994 Subdivision Improvements Project Number 94-907A in the net amount of $15,017.00. Shawn O'Leary, Assistant Director of Engineering and Utilities, explained Change Order Number 3. 95-237 Moved by Commissioner Brungardt, seconded by Commissioner Maxwell, to approve Change Order Number 3 for the 1994 Subdivision Improvements Project Number 94-907 in the amount of $15,017. Aye: (5). Nay: (0). Motion carried. OTHER BUSINESS (9.1) Ordinance Number 95-9700 authorizing the City Manager to execute a contract for fire protection of property outside the City Limits. Dennis Kissinger, City Manager, explained the contract with Rosemary Bonin, 209 East Pleasant Hill Road. 95-238 Moved by Commissioner Maxwell, seconded by Commissioner Seaton, to adopt Ordinance Number 95-9700 for first reading. Aye: (5) . Nay: (0) . ii Motion carried. 95-239 Moved by Commissioner Brungardt, seconded by Commissioner Maxwell, to declare an emergency exists as there will not be a commission meeting July 31, 1995. Aye: (5). Nay: (0). Motion carried. 95-240 Moved by Commissioner Perney, seconded by Commissioner Maxwell, to adopt Ordinance Number 95-9700 on second reading. A roll call vote was taken. Aye: (5), Perney, Maxwell, Brungardt, Seaton, Divine. Nay: (0). Motion carried. (8.9) Request for Executive Session to discuss a personnel matter. 95-241 Moved by Commissioner Seaton, seconded by Commissioner Brungardt, that the Board of Commissioners recess into executive session for 15 minutes for the purpose of discussing a personnel matter regarding a non -elected employee of the City for the reason that public discussion of the matter would invade the privacy of the employee involved. Aye: (5). Nay: (0). Motion carried. The Board of Commissioners recessed at 5:37 p.m. and reconvened at 5:52 p.m. The commissioners took no action. ADJOURNMENT 95-242 Moved by Commissioner Brungardt, seconded by Commissioner Maxwell, that the Regular Meeting of the Board of Commissioners be adjourned. Aye: (5) . Nay: (0) . The meeting adjourned 5:5 p.�� (SEAL) ATT ohn Divine, Mayor D. . ng, Cit lerk