TREMONTON CITY CORPORATION
CITY COUNCIL MEETING

JUNE 19, 2018

Members Present:
Diana Doutre—excused
Lyle Holmgren
Jeff Reese—excused
Bret Rohde
Lyle Vance
Roger Fridal, Mayor
Shawn Warnke, City Manager
Linsey Nessen, City Recorder

CITY COUNCIL WORKSHOP

Mayor Fridal called the June 19, 2018 City Council Workshop to order at 6:00 p.m. The meeting was held in the City Council Meeting Room at 102 South Tremont Street, Tremonton, Utah. Those in attendance were Mayor Fridal, Councilmembers Holmgren, Rohde, and Vance, City Manager Warnke, and City Recorder Nessen. The following Department Heads were also present: Parks and Recreation Director Marc Christensen, Public Works Director Paul Fulgham, Police Chief Kurt Fertig, Treasurer Sharri Oyler, and Library Director Kim Griffiths. Also in attendance were: City Attorney Dustin Ericson, Members of the Library Board, and Librarian Rebecca Jeppesen. Councilmembers Doutre and Reese were excused.

1. Opening and Public Meetings Act and Utah Public Officer and Employees Ethics Act Training- Dustin Ericson, City Attorney

Attorney Ericson trained the Council on the Municipal Officers and Employees Ethics Act.

2. Review of items listed on the 7:00 p.m. agenda

Mayor Fridal brought up water rates that had been discussed during the previous meeting ($20 base rate and $1.50 per thousand gallons for 30,000 gallons). This would cost $65 a month for secondary plus culinary. Director Fulgham said the base fee is $8 for culinary with $1.25 for the first 7,000 gallon units. The average home will use 2,000 to 7,000 gallons indoors. Mayor Fridal said that total water bill would be $70, which struck him as being an awful lot.

Treasurer Oyler talked about write-offs for utility and ambulance. The total for utilities is $2,489.70. These individuals have moved and we do not have any forwarding information for them and have been sent to collections. Manager Warnke directed the Council to the balance sheet. We do not think these are collectible and we recognize it as bad debt. Treasurer Oyler said the ambulance write-off is $69,990.20. Most of those are people who have left or were just driving through and have been sent to collections. Councilmember Rohde asked about the bad debt ratio to revenue and how that is trending. Manager Warnke said that is part of our budgeting. In the budget we put a bad debt allowance. We budget $130,000 this year and this is coming in at $70,000. Over the last three years it has been pretty consistent. Director Christensen shared the actuals for 2014 to 2015 ($88,000), 2015 to 2016 ($121,000), 2016 to 2017 ($128,000) and this past year ($69,000). Manager Warnke said this is what we are declaring as bad debt. The likelihood of collecting on it is slim and it is appropriate to recognize it as uncollectable.

Treasurer Oyler also talked about a resolution for the State Treasurer’s Office declaring who can sign on the City’s accounts. She said those who could sign should be herself, Recorder Nessen and Manager Warnke, as well as Mayor Fridal to transfer money in or out. Manager Warnke said this is more specific for the PTIF accounts rather than just checks that go out. This is more making administrative changes to our PTIF accounts.

Director Christensen then talked about the budget. He said a lot of the highlighted items are from the tentative budget, but he highlighted the major changes from when the Council adopted the tentative budget to now. Here are the noteworthy changes in the General Fund: we have added enough salary and benefits for an additional police officer, with a one-time purchase of equipment. That is $60,000 total, $40,000 for the vehicle and $20,000 for the equipment that goes in the vehicle. For the Police Department we have also added some overtime. The Library hours have been extended. This includes wages for two employees for two extra hours a day during the week—an additional $12,000. The Library needs new carpet and $30,000 was transferred to the General Fund to update the community billboard signs. We added additional money for secondary water in the Water Fund ($500,000). For the Storm Drain Fund, a lot of work has been completed on Main Street and those funds have been sent to UDOT. We dropped that amount by half. In the RDA Fund, we have $30,000 for a façade grant. For our contract minute taker we have added the Historic Preservation Commission and Arts Council so we have updated that contract. There will be an additional $1,200 for the year. Councilmember Rohde asked if the minutes can be summarized or if they needed to be verbatim. Manager Warnke said they could be more general in some of the boards where it is not as critical, others, like City Council, requires more detail because there is a higher level of scrutiny and need for records. The contract does have some guidelines and there are minimum requirements in the State Code about what is included in the minutes. Director Christensen said those are the major changes.

Councilmember Holmgren asked about UTOPIA and if it is going to continue to trend down. Manager Warnke said it should trend 2% upwards according to our debt service, but UTOPIA is to a point where those who are current will have revenues available to keep their debt service flat. That is the benchmark they are working toward. Councilmember Vance asked about the road at 10th north that goes up the hill and down past McDonald’s and if we are prioritizing those. Councilmember Vance asked if we need to start putting money away as it will cost a lot to improve those streets. Manager Warnke said we did set up a Capital Transportation Fund (Fund 42) and the revenue associated with that comes from transfers from the General Fund at the end of the fiscal year if we have a surplus. Right now we have about a million-dollar revenue. The next resolution proposes the priority of the transfer of funds. It is proposed that we transfer $400,000 to the Transportation Fund. We are going to spend $600,000 this coming fiscal year to complete the obligation we have to start the BR Mountain Road. That is the next priority we have put money aside for. Fund 42 is meant to work on any project that adds capacity into the system. We are also working with the developer for a collector road at the intersection of 950 East and Main Street. There are a lot of different road projects we foresee. The Transportation Plan will also be coming to the Council on July 17, which shows a lot of projects. We are looking at different revenue sources that the Council can consider if you want to see more funds put aside for transportation, which we will discuss more then.

Director Christensen continued to show the Council the differences between the tentative and final budgets. The Food Pantry is similar to last year and so is the Recreation Fund. Noteworthy items for the Parks Fund is completing the trail and landscaping on the trailhead at the Malad River Bottoms. For Fire and EMS, we will receive $180,000 with the loan and then start paying out on the ambulance, fire truck and defibrillators. Mayor Fridal asked if that is what the $950,000 is going toward. Director Christensen said that is total expenditures from everything Fire and EMS have. The lease service payment is $119,000 of that total and is going toward the loan. There is also the Animal Control building, new playground at Meadow Park, parking lot at the Parks building and the Senior Center roof. Director Fulgham said it needs to be a metal roof because it has all the equipment up top for the AC units. A metal roof would go a long way in eliminating the problems we have had with shingles. There have been a lot of leaks and the carport is so flat that water backs up. That would be contracted out. Director Christensen said Meadow Park is the oldest park we have and is in the most need of repair. Councilmember Vance asked if that amount would take care of the BR Mountain Road. Manager Warnke said we hope so. The cost to get projects done is climbing. We are hoping when we bid it out this fall we get people who want winter work and would keep the cost low.

Director Christensen said for the Water Utility Fund the biggest expense is for secondary water construction. For the Wastewater Fund there are a lot of expenditures this year to get the City up to State Code. There are bio-solids handling and nutrient removal projects. Director Fulgham said it is under design right now and that project will be done by next summer. Director Christensen said the biggest item in the Sewer Fund is the sewer construction for the BR Mountain Road. The Storm Drain Fund we reduced a bit because we have completed the Main Street road with UDOT paying us back for a portion of the pipe ($127,000). In the RDA Fund we added the façade grant ($30,000) to help business owners clean up Main Street—something they can apply for.

Councilmember Rohde said last year we budgeted $13 million and this year it is $15 million and asked if we are expecting to receive enough revenue to cover that $15 million. Manager Warnke said yes, there have been some appropriated fund balances and a lot of it is capital projects. We are doing the Wastewater Treatment projects, which is a couple million, secondary water is a couple million so we will see a big difference because of the number of projects we are undertaking. Director Christensen said a lot of funds we have already put aside and will appropriate. Manager Warnke said there is $325,000 in the General Fund that is coming from the new property tax. There is new taxable value coming out of the West Liberty Foods project area. In the tentative budget we estimated $275,000, but the certified tax rate by the County Auditor is going to deliver $329,000. They understand and know what the new growth is, but since we do not have that component, we do our best to estimate it. That is close to $60,000 additional revenue than we anticipated.

Councilmember Vance said just above the total budget there should be another line that shows transfers from funds and another that shows the growth that happens with new incomes so we can see what is going on. That 17% is ridiculously high when looking at it, but if we had that detailed as to why, it is easier to see. Manager Warnke said in going though the slides we tried to highlight some of those big capital projects, but that would be a nice enhancement on the spreadsheet. Director Fulgham said for the Treatment Plant that is all money set aside from revenues that we have been building and the same goes for secondary. We have been doing that for a few years so we would not have to borrow money. Councilmember Rohde said it would be nice to see another line item showing this year over next year—showing the increase we expect to see. The Council appreciated the work staff did to bring them this information.

3. CLOSED SESSIONS: No closed session was held at this time
a. Strategy session to discuss the purchase of real property when public discussion of the transaction would disclose the appraisal or estimated value of the property under consideration or prevent the public body from completing the transaction on the best possible terms; and/or
b. Strategy session to discuss the character, professional competence or physical or mental health of an individual; and/or
c. Strategy sessions to discuss pending or reasonably imminent litigation; and/or
d. Discussions regarding security personnel, devices or systems

The meeting adjourned at 6:59 p.m. by consensus of the Council.

CITY COUNCIL MEETING

Mayor Fridal called the June 19, 2018 City Council Meeting to order at 7:07 p.m. The meeting was held in the Tremonton City Council Meeting Room at 102 South Tremont Street, Tremonton, Utah. Those in attendance were Mayor Fridal, Councilmembers Holmgren, Rohde, and Vance, City Manager Warnke, and City Recorder Nessen. The following Department Heads were also present: Parks and Recreation Director Marc Christensen, Public Works Director Paul Fulgham, and Police Chief Kurt Fertig. Councilmembers Doutre and Reese were excused.

1. Opening Ceremony:

Mayor Fridal informed the audience that he had received no written or oral request to participate in the Opening Ceremony. He asked anyone who may be offended by listening to a prayer to step out into the lobby for this portion of the meeting. The prayer was offered by Director Christensen and the Pledge of Allegiance was led by Councilmember Holmgren.

2. Introduction of guests:

Mayor Fridal welcomed those in attendance.

3. Approval of Agenda:

Motion by Councilmember Holmgren to approve the agenda of June 19, 2018. Motion seconded by Councilmember Vance. Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

4. Approval of minutes – June 5, 2018

Motion by Councilmember Vance to approve the minutes of June 5, 2018. Motion seconded by Councilmember Rohde. Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

5. Public comments: Comments limited to three minutes.

Jonathan Gardner said he has been reviewing the minutes from previous meetings and appreciates the Council’s thoroughness and thoughtfulness when it comes to the secondary water system. He asked what is going to be done to help with the quality of the water. I live on Radio Hill and cannot do a full acre without having to change the filter because it gets clogged with peat moss, sand and rocks. I am very grateful we have secondary water and are trying to expand it, but I wonder what we are going to do as far as quality and improving filtration. Councilmember Holmgren suggested he stay in touch and talk to Director Fulgham.

6. Public Hearings:
a. To consider adopting the Final Annual Budget entitled “The Tremonton City Annual Implementation Budget 2018-2019 (General Fund, Capital Fund(s), Enterprise Fund(s), and Special Fund(s)”, for the period commencing July 1, 2018, and ending June 30, 2019

Mayor Fridal called a Public Hearing to order at 7:11 p.m. The Public Hearing was closed at 7:12 p.m. There were six people in attendance.

b. To consider amending the Annual Budget entitled “The Tremonton City Annual Implementation Budget 2017-2018 (General Fund, Capital Fund(s), Enterprise Fund(s), and Special Fund(s)”, for the period commencing July 1, 2017, and ending June 30, 2018

Mayor Fridal called a Public Hearing to order at 7:12 p.m. The Public Hearing was closed at 7:12 p.m. There were six people in attendance.

7. New Council Business:
a. Discussion and consideration of adopting Resolution No. 18-28 adopting the Final Budget entitled “The Tremonton Annual Implementation Budget 2018-2019 (General Fund, Capital Fund(s), Enterprise Fund(s) and Special Fund(s)” for the period commencing July 1, 2018, and ending June 30, 2019

Manager Warnke said we have dog kennels we need to add to our existing facility, which is about $1,500 that was not anticipated in the budget. The Council should consider adopting with that addition, as well as the additional $1,200 for the contract minute taker, which will be spread across multiple funds. Lastly, in talking to Chief Batis, we think we can drop the appropriation being proposed from $30,500 closer to $17,000 for ambulance equipment.

Motion by Councilmember Vance to adopt Resolution 18-28 to include the items Manager Warnke has mentioned. Motion seconded by Councilmember Holmgren. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

b. Discussion and consideration of adopting Resolution No. 18-29 amending the budget entitled “The Tremonton City Annual Implementation Budget 2017- 2018 (General Fund, Capital Fund(s), Enterprise fund(s), and Special Fund(s),” for the period commencing July 1, 2017, and ending June 30, 2018

Manager Warnke said there are changes being proposed, but a lot of the amendments are ones the Council has known about. State Code does not allow us to over extend the budget—even $1 could create problems for the City. Sometimes at the end of the year we appropriate funds to ensure there are not overruns. We are usually in pretty good shape. For those that are closer than others, we make sure we have a good safety margin to comply with State Code. This is where we start to replenish some of our Capital Project Funds with transfers from the General Fund based on surplus. There is an order and we can prioritize it anyway we want. We did get some late notice from Director Roberts that there has been a change in State law saying the City cannot have 25% accumulated fund balance within the General Fund. That 25% used to be calculated on next years revenue, but now it is the current year’s actuals. A wild card for the City is sales tax, but we think we are going to have a really good year. We are tracking ahead of last year and climbing over recent years, which allows us to do certain projects, but that might limit the amount we can transfer. If we calculate the transfers based on this new threshold of actuals for this year then it will lessen the amount we would transfer. We will visit with Director Roberts in depth about how we want to replenish these funds. We do have a good amount in the City’s General Fund right now. I recommend we move forward with some of these transfers to change the language in the resolution accordingly. Councilmember Rohde said he does not like a dollar limit and would rather see a percentage. A great year may allow that to come up a little. Manager Warnke said we do that sometimes to ensure a guarantee. We can do an amount or percentage, whichever is greater. Councilmember Rohde asked if we wanted to do more work on those roads and allocate more expenses if we would have to change this resolution or would we balance and transfer some into this account from our General Fund. Manager Warnke said this is one of the mechanisms we go by, but it is not the only one. Part way through the year we can transfer money. In Fund 71, the RDA, we have $200,000 for downtown. We started to amass money within that fund to undertake projects. We have done little projects along the way, but the intent is to do larger ones. We have obligated the tax increment to repay the developer as the first obligation and the second is transferring $400,000 to the Transportation Capacity Capital Project Fund and then the last item would be a 50/50 split of whatever is remaining into the Capital Projects and the Vehicle Equipment Replacement funds. We have done a good job over the years to keep that current. For fiscal year 2020 we have programed in the replacement of a street sweeper and a couple police cars (up to three). We are also contemplating replacing the Public Works mower. There is close to $400,000, but we can move through money fairly quickly in replacing some of the equipment needed to provide services.

Councilmember Vance questioned if Fund 71 (RDA) is different from Tremont Center. Manager Warnke said no and explained that it has a different name because this fund was already established. An RDA was done years ago in the downtown area so they used that same fund, which is the same money. Councilmember Vance wanted to make sure the City is keeping track of that and that the developer is only being paid with tax increment coming from the increase in real estate values and not funds transferred into the RDA by the City. Manager Warnke said they are. Every given year the calculation is known and the check we receive from the County is clear on the increment that is received. Several years ago the RDA and City entered into an agreement whereby we would make a contribution to this fund in advance of tax increment with the understanding from the RDA that if there were sufficient tax increment realized it would be repaid back to the City. We are not keeping track of interest. It is classified as a financial contribution with the understanding that it be repaid if funds are sufficient.

Motion by Councilmember Holmgren to adopt Resolution 18-29. Motion seconded by Councilmember Rohde. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

Manager Warnke said I mentioned the change in State Code and allocation of those State funds and asked if those are the allocations the Council would like to see end up in the fund. The calculation would be a little different by virtue of the actual revenue that would be calculated, but asked if the Council is okay with transferring those funds and amending the resolution to reflect it. The Council agreed.

c. Discussion and consideration of adopting Resolution No. 18-30 approving the revised Tremonton City Compensation and Classification Plan

Recorder Nessen said we update our pay range minimums and maximums every year to reflect COLA increases. We talked about the salary survey we did and changing the starting wages of A1-B1 to start with. This is the usual that happens every year that increases our pay ranges.

Motion by Councilmember Rohde to adopt Resolution 18-30. Motion seconded by Councilmember Holmgren. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

d. Discussion and consideration of adopting Resolution No. 18-31 approving the certified tax rates for the 2018 tax year

Manager Warnke said certified tax rates are aimed at delivering the same amount of revenue that the City received last year, plus new growth. It goes up and down to deliver the same amount of money. This year there is quite a bit of new growth occurring based upon West Liberty Foods taxable value coming out of the RDA and into the City. About $330,000 is associated with that. Tremonton City is not the only taxing entity that is receiving growth—this includes all the taxing entities. This would be ongoing revenue. The certified tax rate will go up and down based upon factors, but it should stay the same with the exception of new growth, which will then increase it. Councilmember Vance clarified that the Council is simply adopting what the County has put together for taxation.

Motion by Councilmember Vance to adopt the resolution. Motion seconded by Councilmember Rohde. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

e. Discussion and consideration of adopting Resolution No. 18-32 approving the first amendment to the interlocal agreement between Tremonton City Redevelopment Agency and Tremonton City, authorizing the Tremonton City Redevelopment Agency to receive tax increment from the Tremont Center Community Development Project Area Plan dated the 17th day of March 2015

Manager Warnke said this is relative to the Tremont Center project area. The way the RDA is able to receive increment is through these interlocal agreements that each taxing entity approves. Tremonton City is a separate unit from the RDA and for that reason, enters into this interlocal agreement. Whenever we do a project area we look at how much growth we think is going to occur and evaluate the base year of taxable value—that is what sets the threshold so we know what the increment received is. When we created the project area the base year taxable value was $10.3 million. In the interlocal agreement the base year taxable value was $148,000 for the annual revenue that was associated off that $10 million. The taxing entities are receiving $148,000 from all the taxable value within that project area’s boundaries. The county auditor uses the PT700 report to calculate tax increment. There is $19 million in there right now as the incremental tax value. The RDA was to receive $90,000, but it was passed onto the developer as part of our reimbursement agreement. The current agreement shows $148,000 as the base year value. The actual resolution, what we are proposing, is correcting and scratching out the $148,000 and inserting the correct base year actualities. We are the agency asking all the other taxing entities to do the same and consider this amendment. This is what we agreed to in principal, we just want to make it correct on paper. The projections have not changed nor has the time limit of 15 years. The only thing that has changed is correcting the clerical error that occurred. We still stand to make $4.5 million with development.

Motion by Councilmember Holmgren to adopt Resolution 18-32 and approve the changes that have been discussed. Motion seconded by Councilmember Rohde. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

f. Discussion and consideration of adopting Resolution No. 18-33 authorizing the Mayor to sign and certify to the Office of the State Treasurer’s Public Entity Resolution Form which designates and authorizes certain City Officials to transact with Tremonton City’s public treasurers investment fund (PTIF) accounts

Motion by Councilmember Vance to adopt the resolution adding the names of Manager Warnke, Recorder Nessen, Treasurer Oyler and Mayor Fridal. Motion seconded by Councilmember Rohde. Roll Call Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

g. Discussion and consideration of ambulance write-off’s for non-collectible accounts as bad debt

Motion by Councilmember Rohde to pass the ambulance write-offs for non-collectible accounts as discussed during the workshop. Motion seconded by Councilmember Holmgren. Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

h. Discussion and consideration of utility write-off’s for non-collectible accounts as bad debt

Motion by Councilmember Rohde to pass the utility write-offs for non-collectible accounts as discussed during the workshop. Motion seconded by Councilmember Holmgren. Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

8. Calendar Items and Previous Assignment
a. Review of calendar

Manager Warnke said there is an opportunity for downtown revitalization information from expert Roger Brooks. Brigham City has engaged him to do some additional work and has extended an invitation for Tremonton City to attend the general session on Tuesday, June 26, from 9:30-10:30 a.m. He is being brought in to work with them on their Main Street. Recorder Nessen will send a text to remind the Council of the event.

Mayor Fridal reminded the Council about the summer party and BBQ, which will be held next Tuesday for City employees at 6 p.m.

Director Christensen said City Days will be July 20-21. We need judges for the BBQ contest and asked the Council to serve breakfast. This Saturday the Arts Council is putting on their Chalk Fest at Midland Square so go and support it.

b. Review of past assignment
There were no past assignments to review.

9. Reports & Comments:
a. City Manager Reports and Comments
b. Land Use Authority Boards Report and Comments
1. None
c. City Department Head Reports and Comments
d. Council Reports and Comments

Councilmember Holmgren thanked Manager Warnke and Director Christensen for going through the budget and making it easy to grasp.

Councilmember Vance echoed Councilmember Holmgren’s comment and added that the flowers are looking good along Main Street.

Mayor Fridal said Manager Warnke and Director Christensen put in a huge amount of work on the budget. It is awesome they have such skills we can use.

10. CLOSED SESSIONS: No closed session was held at this time.
a. Strategy session to discuss the purchase of real property when public discussion of the transaction would disclose the appraisal or estimated value of the property under consideration or prevent the public body from completing the transaction on the best possible terms; and/or
b. Strategy session to discuss the character, professional competence or physical or mental health of an individual; and/or
c. Strategy sessions to discuss pending or reasonably imminent litigation; and/or
d. Discussions regarding security personnel, devices or systems

11. Adjournment.

Motion by Councilmember Holmgren to adjourn the meeting. Motion seconded by Councilmember Vance. Vote: Councilmember Holmgren – aye, Councilmember Rohde – aye, Councilmember Vance – aye. Motion approved.

The meeting adjourned at 7:46 p.m.

The undersigned duly acting and appointed Recorder for Tremonton City Corporation hereby certifies that the foregoing is a true and correct copy of the minutes for the City Council Meeting held on the above referenced date. Minutes were prepared by Jessica Tanner.

Dated this day of , 2018.

Linsey Nessen, City Recorder