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HomeMy Public PortalAbout05.19.2020 City Council Meeting Packet Posted 05/15/2020 Page 1 of 1 AGENDA FOR THE REGULAR MEETING OF THE MEDINA CITY COUNCIL Tuesday, May 19, 2020 7:00 P.M. Meeting to be held telephonically/virtually pursuant Minn. Stat. Sec. 13D.021 I. CALL TO ORDER II. PLEDGE OF ALLEGIANCE III. ADDITIONS TO THE AGENDA IV. APPROVAL OF MINUTES A. Minutes of the May 5, 2020 Regular Council Meeting V. CONSENT AGENDA A. Resolution Granting Approval of Conditional Use Permit to Christine and James Stetler for Accessory Structure Over 5,000 Square Feet at 1832 Medina Road B. Approve First Amendment to Development Agreement between City of Medina and The Wealshire, LLC C. Approve Amendment to Upland Buffer Easement Agreement at 3153 Magnolia Drive D. Resolution Approving and Authorizing Execution of Construction Cooperative Agreement with Hennepin County for the Arrowhead Drive Railroad Improvement Project E. Resolution Exhibit E for Grant Agreement to State Transportation Fund Local Road Improvement Program Grant Terms and Conditions SAP 250-593-001 for the Arrowhead Drive Railroad Improvement Project F. Resolution Accepting Bids and Awarding the Contract for the Arrowhead Drive Railroad Improvement Project G. Resolution Accepting Resignation of Aaron Amic from the Planning Commission VI. COMMENTS A. From Citizens on Items Not on the Agenda B. Park Commission C. Planning Commission VII. PRESENTATIONS A. Abdo Eick & Meyers – 2019 Annual Financial Report VIII. NEW BUSINESS A. Tamarack Drive Corridor/Visioning Study – Concept Review and Update B. 2020 Meeting & Event Calendar Updates C. Public Safety COVID-19 Update IX. CITY ADMINISTRATOR REPORT X. MAYOR & CITY COUNCIL REPORTS XI. APPROVAL TO PAY BILLS XII. ADJOURN Telephonic/Virtual Meeting Call-in Instructions Join via Microsoft Teams to view presentations at this link: https://medinamn.us/council/ For audio only: Dial 1-612-517-3122 Enter Conference ID: 491 897 16# MEMORANDUM TO: Medina City Council FROM: Scott Johnson, City Administrator DATE OF REPORT: May 14, 2020 DATE OF MEETING: May 19, 2020 SUBJECT: City Council Meeting Report Telephonic/Virtual Meeting Call-in Instructions Join via Microsoft Teams to view presentations at this link: https://medinamn.us/council/ For audio only: Dial 1-612-517-3122; Enter Conference ID: 491 897 16# V. CONSENT AGENDA A. Resolution Granting Approval of Conditional Use Permit to Christine and James Stetler for Accessory Structure Over 5,000 Square Feet at 1832 Medina Road – The City Council reviewed this request at their May 5th meeting and directed staff to prepare the attached resolution for approval. Staff recommends approval of the resolution granting a conditional use permit to Christine and James Stetler at 1832 Medina Road. See attached resolution. B. Approve First Amendment to Development Agreement between City of Medina and The Wealshire, LLC – The Wealshire LLC has applied for permits to construct the 2nd Phase of its building at 4555 Mohawk Drive. The City Council granted Site Plan Review approval for this addition when the original building was approved. The City Attorney has drafted an amendment to the Development Agreement which allows the use of the existing Letter of Credit to cover the limited site improvements to be constructed with Phase II. The amendment also establishes a deadline for completion of the site improvements. Staff recommends approval of the First Amendment to Development Agreement and authorize the Mayor and City Administrator to execute. See attached agreement. C. Approve Amendment to Upland Buffer Easement Agreement at 3153 Magnolia Drive – The property owner has requested to amend the upland buffer on the property to provide more space for a deck on the property. The upland buffer is proposed to be “averaged” on the property, widened in one portion of the lot to make up for the narrower portion. This averaging is allowed in the City’s wetland protection ordinance. The amended easement agreement would document the new location. Staff will also be requiring an escrow to guarantee that the wider portion of the buffer is planted as required. Staff recommends  2 approval of the Amendment to Upland Buffer Easement Agreement and authorize the Mayor and City Administrator to execute. See attached agreement. D. Resolution Approving and Authorizing Execution of Construction Cooperative Agreement with Hennepin County for the Arrowhead Drive Railroad Improvement Project – There are two agreements required for the Arrowhead Drive Railroad Improvement Project. The first is a two-party agreement between the City and Hennepin County that generally addresses ownership, maintenance, and construction management of the proposed improvements. Staff recommends adoption of the resolution approving and authorizing execution of this agreement. See attached memo, agreement and resolution. E. Resolution Exhibit E for Grant Agreement to State Transportation Fund Local Road Improvement Program Grant Terms and Conditions SAP 250-593-001 for the Arrowhead Drive Railroad Improvement Project – The second agreement that is required for the Arrowhead Drive Railroad Improvement Project is a three-party agreement between the City, Hennepin County, and MnDOT which integrates the LRIP funding mechanism and will allow the City to be reimbursed for project costs with these funds. Staff recommends adoption of the resolution authorizing this agreement. See attached agreement and resolution. F. Resolution Accepting Bids and Awarding the Contract for the Arrowhead Drive Railroad Improvement Project – Five bids were received with the apparent low bid submitted by Minger Construction Company, Inc. in the amount of $426,969.10 (still under the LRIP amount of $450,000). The low bid did come in above the engineer’s estimate of $354,364.00. The major items that accounted for the increase in cost included mobilization, railroad protective liability insurance, utility coordination, and storm sewer work. A summary of the project bid abstract is enclosed. Staff recommends approval of the resolution accepting bids and awarding the contract. See attached bid tabulation and resolution. G. Resolution Accepting Resignation of Aaron Amic from the Planning Commission – Planning Commissioner Aaron Amic is planning to move out of the City in June and, as a result, has submitted his resignation from the Planning Commission. Aaron’s resignation is attached. Staff recommends approval of the resolution accepting his resignation. See attached memo, letter and resolution.  3 VII. PRESENTATIONS A. Abdo Eick & Meyers – 2019 Annual Financial Report – A representative from Medina’s auditing firm, Abdo, Eick, and Meyers, will present a report of the 2019 financial statements at the City Council. See attached financial report. Recommended Motion: Accept the 2019 Audit from Abdo, Eick, and Meyers. VIII. NEW BUSINESS A. Tamarack Drive Corridor/Visioning Study – Concept Review and Update – Staff requests input and direction from the City Council on a preferred option and consider an endorsement of the need for a signal at TH 55. After review, the Council can consider the following actions: Recommended Motion #1: to proceed with Concept # as the preferred option, including a full access with signal at Highway 55. Recommended Motion # 2: to direct staff to take actions necessary to secure approval from relevant agencies for the access at Highway 55 and to complete the Tamarack Drive Study. See attached report. B. 2020 Meeting & Event Calendar Updates – Due to COVID-19, staff is seeking council direction on changes to Medina’s 2020 Meeting & Event Calendar. The attached memo outlines recommendations for Medina Clean-up Day, Night to Unite, and Medina Celebration Day. See attached memo and calendar. Recommended Action:  Discuss feasibility of holding a limited contact Clean-up Day Event  Discuss cancelling Medina Celebration Day in 2020  Adopt updated meeting calendar C. Public Safety COVID-19 Update – Public Safety Director Jason Nelson will provide an update at the meeting on COVID-19 and Public Safety. See attached memo. XI. APPROVAL TO PAY BILLS Recommended Motion: Motion to approve the bills, EFT 005511E-005527E for $55,336.49 and order check numbers 050215-050250 for $76,543.78, payroll EFT 0510225-0510258 for $52,177.99.  4 INFORMATION PACKET:  Planning Department Update  Police Department Update  Public Works Department Update  Claims List  Medina City Council Meeting Minutes 1 May 5, 2020 DRAFT 1 2 MEDINA CITY COUNCIL MEETING MINUTES OF MAY 5, 2020 3 4 The City Council of Medina, Minnesota met in regular session on May 5, 2020 at 7:00 5 p.m. in the City Hall Chambers. Mayor Martin presided. 6 7 Martin read a statement explaining that it is not prudent at this time to hold in person 8 meetings because of the health risks of public gatherings due to COVID-19 and 9 therefore this meeting will be held telephonically. 10 11 I. ROLL CALL 12 13 Members present: Albers, Anderson, DesLauriers, Martin, and Pederson. 14 15 Members absent: None. 16 17 Also present: City Administrator Scott Johnson, Assistant City Administrator Jodi 18 Gallup, City Attorney Ron Batty, Finance Director Erin Barnhart, City Engineer Jim 19 Stremel, City Planning Director Dusty Finke, Public Works Director Steve Scherer, and 20 Chief of Police Jason Nelson. 21 22 II. PLEDGE OF ALLEGIANCE (7:09 p.m.) 23 24 III. ADDITIONS TO THE AGENDA (7:09 p.m.) 25 Johnson stated that staff is requesting to add an Item under New Business, Item C, 26 Public Works Maintenance Technician and Seasonal Position. 27 28 Moved by Martin, seconded by Anderson, to approve the agenda as amended. Motion 29 passed unanimously. 30 31 IV. APPROVAL OF MINUTES (7:10 p.m.) 32 33 A. Approval of the April 21, 2020 Regular City Council Meeting Minutes 34 Martin noted that changes provided by herself and Anderson were circulated prior to the 35 meeting for incorporation. 36 37 Moved by Anderson, seconded by Albers, to approve the April 21, 2020 regular City 38 Council meeting minutes as amended. Motion passed unanimously. 39 40 V. CONSENT AGENDA (7:12 p.m.) 41 42 A. Approve 2019 Annual Report 43 B. Approve Mill and Paving Services Agreement with Omann Brothers, Inc. 44 C. Approve Seal Coating Services Agreement with Pearson Brothers, Inc. 45 D. Approve Services Agreement for Lake Independence Shoreline 46 Stabilization Project with Hantho Outdoor Services 47 E. Approve Ardmore Culvert Replacement Agreement with Burchville 48 Construction, Inc. 49 Moved by Pederson, seconded by Anderson, to approve the consent agenda. Motion 50 passed unanimously. 51 Medina City Council Meeting Minutes 2 May 5, 2020 1 VI. COMMENTS (7:14 p.m.) 2 3 A. Comments from Citizens on Items not on the Agenda 4 There were none. 5 6 B. Park Commission 7 Scherer reported that the park spring cleanup was done the past week with the new 8 contractor and they are doing a good job. He provided an update on the parks including 9 improvements and increased activity. 10 11 Martin asked about social distancing within the parks. 12 13 Scherer reported that typically they are viewing a family with perhaps a neighbor, noting 14 that perhaps two families have decided to become a group. He stated that for the most 15 part people are respecting each other and maintaining space. He noted that as in other 16 locations, some people take it more seriously than others. 17 18 DesLauriers stated that he noticed four people playing basketball together at the park. 19 He stated that he also observed the fence installed to shorten the little league fence, 20 noting that originally, he had concern with parents and children close to the parking lot 21 but now seeing it in place, he believes the setup will work. 22 23 Anderson asked if the City has printed signage encouraging social distancing that could 24 be placed around the parks. 25 26 Scherer stated that they had laminated signs placed near the park equipment. He stated 27 that if desired, staff could place a few additional signs encouraging social distancing. 28 29 C. Planning Commission 30 Finke reported that the Planning Commission will meet the following week to conduct 31 public hearings regarding a request for a two-lot subdivision for property east of City Hall 32 along Medina Road and a request related to setback requirements for garden sheds. 33 34 VII. NEW BUSINESS 35 36 A. Stetler – Conditional Use Permit for Barn at 1832 Medina Road (7:22 p.m.) 37 Finke reported that the applicants are seeking a Conditional Use Permit for an accessory 38 structure of 14,600 square feet which will house an indoor riding arena, barn and staging 39 area. He noted that a CUP is required for accessory structures over 5,000 square feet in 40 size. He reviewed the location of the property, noting that the single-family home on the 41 property is currently under construction. He provided details on pasture and paddocks 42 areas along with the manure management plan. He reviewed the architectural details 43 and proposed materials for the structure. He stated that the Planning Commission held 44 a public hearing, noting that one comment of support was received, and the Commission 45 recommended approval subject to the conditions within the report. 46 47 Pederson commented that it appears that this will be an outstanding looking building. 48 He asked if there will be a requirement for sprinklers to be installed because the size of 49 the building exceeds 12,000 square feet, or whether that requirement is simply for 50 commercial use. 51 Medina City Council Meeting Minutes 3 May 5, 2020 1 Finke stated that this would be subject to building code requirements and review but did 2 not believe that sprinklers would be required for this type of use. 3 4 Pederson commented that he likes the architectural elements and colors proposed. 5 6 Martin commented that she also finds the design aesthetically pleasing. 7 8 Moved by Anderson, seconded by Pederson, to direct staff to prepare a resolution 9 approving the Conditional Use Permit for a barn at 1832 Medina Road per the conditions 10 noted in the staff report. 11 12 A roll call vote was performed: 13 14 Pederson aye 15 Anderson aye 16 DesLauriers aye 17 Albers aye 18 Martin aye 19 20 Motion passed unanimously. 21 22 B. City Attorney Update on Allowing a Return to In-Person Meetings (7:33 23 p.m.) 24 Batty stated that this is a follow up to the short discussion at the last Council meeting as 25 to what it could look like transitioning from the telephone meetings. He noted that his 26 memorandum provided background information on how the City got to this position and 27 what has occurred over the past seven weeks. He stated that the Governor’s Stay at 28 Home Order does not directly relate to public meetings, but the spirit is to prevent people 29 from gathering in large numbers. He stated that the City found that it was not prudent or 30 practical to hold public meetings and that is why the telephone meetings began. He 31 provided details on the Statute that is used to allow meetings to be held telephonically. 32 He noted that if the Local Emergency were ended, if the State Emergency were ended, 33 and if there were no longer a health pandemic, then the City would be forced to hold in 34 person meetings. He explained that it is difficult to say when those things would happen 35 and when COVID-19 will no longer be ruled a pandemic. 36 37 Martin stated that she misses seeing everyone in person but is surprised at how well the 38 telephonic meetings have gone. She stated that members of the public participating 39 have been cordial and courteous. She stated that she would continue to hold telephone 40 meetings until such time it is safe to hold in person meetings. 41 42 Anderson echoed the comments of Martin that he also misses seeing everyone in 43 person. He commented that as well run as the telephone meetings are, it is still better to 44 see people. He stated that the decision will have to be made in the future as the 45 Governor’s Stay at Home Order remains in place. 46 47 Pederson commented that he believes that it is important that the City continue to hold 48 telephonic meetings in order to continue public safety. He commented that as nice as it 49 is to see everyone, he would not want to risk anyone’s health, whether that is the 50 Council or City staff. 51 Medina City Council Meeting Minutes 4 May 5, 2020 1 DesLauriers stated that the decision is moot at this point. He stated that he misses 2 seeing everyone in person and the events that have been canceled, but this method is 3 going well, and the City is still able to accomplish its business. 4 5 Martin stated that she is also missing the City events. 6 7 Albers echoed the comments, noting that the City will remain on a wait and see 8 approach. He agreed that the meetings have been effective in this manner. 9 10 Martin applauded City staff for coordinating these meetings and helping them run 11 smoothly. 12 13 C. Public Works Maintenance Technician and Seasonal Position (7:43 p.m.) 14 Johnson stated that on May 4th the City received a resignation letter from an employee 15 that was hired one week prior. 16 17 Scherer echoed the comments that the employee resigned after just a few days. He 18 stated that the City has previous approval to solicit and bring on the seasonal employee 19 and he would like to bring that employee on board. He stated that he will bring back a 20 request to solicit and fill the maintenance technician position in the future. 21 22 Moved by Martin, seconded by Anderson, to adopt Resolution No. 2020-25 accepting 23 the resignation of Public Works Maintenance Technician Curtis Biegert and to authorize 24 the appointment of Seasonal Maintenance Technician. 25 26 A roll call vote was performed: 27 28 Albers aye 29 DesLauriers aye 30 Anderson aye 31 Pederson aye 32 Martin aye 33 34 Motion passed unanimously. 35 36 VIII. CITY ADMINISTRATOR REPORT (7:46 p.m.) 37 Johnson had nothing further to report. 38 39 IX. MAYOR & CITY COUNCIL REPORTS (7:46 p.m.) 40 Martin stated that she and Johnson will attend a Zoom meeting with Dean Phillips the 41 following day. 42 43 X. APPROVAL TO PAY THE BILLS (7:47 p.m.) 44 Moved by Anderson, seconded by DesLauriers, to approve the bills, EFT 005490E-45 005510E for $97,986.76, order check numbers 050167-050214 for $198,124.37, and 46 payroll EFT 0510198-0510224 for $50,775.35 and payroll check 0020445 for 47 $13,862.67. Motion passed unanimously. 48 49 Martin encouraged everyone to continue to socially distance, wear masks, wash their 50 hands and remain safe and healthy. 51 Medina City Council Meeting Minutes 5 May 5, 2020 1 XI. ADJOURN 2 Moved by Anderson, seconded by Albers, to adjourn the meeting at 7:49 p.m. 3 4 A roll call vote was performed: 5 6 Pederson aye 7 Anderson aye 8 DesLauriers aye 9 Albers aye 10 Martin aye 11 12 Motion passed unanimously. 13 14 15 16 __________________________________ 17 Kathleen Martin, Mayor 18 Attest: 19 20 ____________________________________ 21 Jodi M. Gallup, City Clerk 22 Resolution No. 2020- DATE Member __________ introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION 2020-## RESOLUTION GRANTING APPROVAL OF CONDITIONAL USE PERMIT TO CHRISTINE AND JAMES STETLER FOR ACCESSORY STRUCTURE OVER 5,000 SQUARE FEET WHEREAS, the city of Medina (the “City”) is a municipal corporation, organized and existing under the laws of Minnesota; and WHEREAS, Christine and James Stetler (the “Owners”) own property located at 1832 Medina Road (the “Property”), which is legally described in Exhibit A, attached hereto; and WHEREAS, on behalf of the Owners, Nor-Son Custom Builders has requested a conditional use permit for construction of an accessory structure with a footprint size of 14,592 square feet on the Property; and WHEREAS, Section 825.19 of the City Code states that the City may grant a conditional use permit to allow for more accessory structures in excess of 5,000 square feet on properties more than five acres; and WHEREAS, the Planning Commission held a public hearing and reviewed the requested conditional use permit on April 14, 2020, heard testimony from the Owners, City staff, and interested parties, and recommended approval subject to certain conditions; and WHEREAS, the City Council reviewed the request at the May 5, 2020 meeting, reviewed the testimony and recommendation of the Planning Commission and took additional testimony; and WHEREAS, following such review, the City Council made the following findings: 1) The proposed accessory structures are consistent with the specific requirements for the conditional use as described in Section 825.19 and 826.98 of the City Code, subject to the conditions noted in this resolution. 2) The proposed uses are consistent with the general criteria described for conditional uses in Section 825.39 of the City Code. Agenda Item # 5A Resolution No. 2020- 2 DATE NOW, THEREFORE BE IT RESOLVED, that the City Council of Medina, Minnesota hereby approves the conditional use permit for the accessory structure noted above, subject to the following terms and conditions: 1) The Owners shall update plans in a manner approved by the City Engineer to direct runoff from the accessory structure away from the paddock area. 2) The Owners shall obtain approval from the Elm Creek Watershed Commission. 3) The Owners shall install improvements as indicated on the civil plans received by the City on 5/1/2020 and architectural plans received 3/20/2020, except as modified by the conditions herein. 4) The Owners shall meet the requirements of the wetland protection ordinance, including provisions for recordation of easements, planting of appropriate vegetation and installation of required signs. 5) The Owners shall execute a stormwater maintenance agreement, in compliance with city requirements, and maintain stormwater management practices as described in the agreement. 6) Manure shall be managed in a manner which prevents nuisance and protects water quality. The Owners shall actively manage the use of pastureland in a manner which prevents overgrazing and erosion. The Owners shall implement manure and pasture management plans in conformance with University of Minnesota Extension guidance. The manure and pasture management shall be subject to periodic review by city staff. 7) The number of animal units shall not exceed eight unless manure and pasture management plans are approved by City staff for additional animals. In any event, animal density on the Property shall not exceed the amount permitted in the Property’s respective zoning district. 8) The Owners shall pay to the City a fee in the amount sufficient to pay for all costs associated with the review of the application for the conditional use permit. Dated: May 19, 2020. By: ______________________ Kathleen Martin, Mayor Attest: By: ___________________________ Jodi M. Gallup, City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member ________ and upon vote being taken thereon, the following voted in favor thereof: And the following voted against same: Whereupon said resolution was declared duly passed and adopted. Resolution No. 2020- 3 DATE EXHIBIT A Legal Description of the Property 1 FIRST AMENDMENT TO DEVELOPMENT AGREEMENT THIS FIRST AMENDMENT TO DEVELOPMENT AGREEMENT (the “First Amendment”) is made this ____ day of _____________, 2020, by and between the city of Medina, a municipal corporation under the laws of Minnesota (the “City”), and The Wealshire, LLC, a Minnesota limited liability company (the “Developer”). WITNESSETH: WHEREAS, on June 8, 2016, the City and the Developer entered into that certain development agreement, which was recorded on June 15, 2016 as Document Number A10322639 (the “Agreement”); and WHEREAS, the Agreement contains the terms and conditions under which the Developer is allowed to develop the real property legally described as follows: The East 740 feet of the Southeast Quarter of the Northwest Quarter of Section 3, Township 118 North, Range 23 West, Hennepin County, Minnesota (the “Property”); and WHEREAS, the Agreement contemplates that the development of the Property would occur in two phases and the Developer recently submitted a new building permit application for the second phase; and WHEREAS, the original set of Plans, as that term is defined in the Agreement, needs to be revised due to updated engineering and constructions plans related to the second phase of the development; and WHEREAS, the Agreement also needs to reflect an updated cost estimate for the Improvements based on the recently updated Plans, and further needs to establish a completion deadline for those Improvements associated with Phase II. NOW, THEREFORE, in consideration of the covenants and the mutual obligations Agenda Item # 5B 2 contained herein, the City and the Developer hereby covenant and agree that the following sections of the Agreement are hereby amended and revised as follows: Section 1. Section 2a) of the Agreement is hereby deleted in its entirety and replaced with the following: 2. Plans; Improvements. a) The Developer agrees to develop the Property in accordance with the City Approvals, as detailed in City ordinance No. 597, and City resolution No. 2016-33, which ordinance and resolution are hereby incorporated into this Agreement, and to construct all improvements on the Property in accordance with the approved final engineering and construction plans dated as of ______________, 2016, and most recently revised on _______________, 2020 (collectively, the “Plans”). The documents which constitute the Plans are those on file with and approved by the City and are listed on Exhibit B attached hereto. The Plans may not be modified by the Developer without the prior written approval of the City. Section 2. Section 5b) of the Agreement is hereby deleted in its entirety and replaced with the following: b) Within 30 days after the completion of the Improvements, the Developer shall supply the City with a complete set of reproducible “as constructed” plans and three complete sets of paper “as constructed” plans, each prepared in accordance with City standards and in AutoCADD format based on Hennepin County coordinates. Sanitary sewer, water and stormwater “as constructed” plans shall also be submitted to the City in GIS format compatible with Arc Map 10.3 in the coordinates and with the attributes directed by the city engineer. Iron monuments must be installed on the Property in accordance with state law. The Developer’s surveyor shall submit a written notice to the City certifying that the monuments have been installed. All Improvements required by this Agreement shall be completed by no later than September 30, 2017, except that those Improvements identified in the Plans as being part of Phase II shall be completed no later than June 30, 2021. Section 3. Exhibit B of the Agreement, which is intended to contain a list of the documents constituting the Plans, shall be removed from the Agreement in its entirety and replaced with the new Exhibit B attached hereto. Section 4. Exhibit F, which contains a site improvement cost estimate prepared by the city engineer, shall be removed from the Agreement in its entirety and replaced with the new Exhibit F attached hereto. Section 5. Except as specifically modified in this First Amendment, all terms and conditions of the Agreement shall remain the same and in full force and effect. ************************** 3 IN WITNESS WHEREOF, the City and the Developer have caused this First Amendment to be duly executed in their names and behalves on or as of the date first above written. CITY OF MEDINA By: __________________________________ Kathleen Martin, Mayor By: __________________________________ Scott T. Johnson, City Administrator STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ___ day of __________, 2020, by Kathleen Martin and Scott T. Johnson, the mayor and city administrator, respectively, of the city of Medina, a Minnesota municipal corporation, on behalf of the municipal corporation. ____________________________________ Notary Public 4 THE WEALSHIRE, LLC By__________________________________ Thomas A. Wiskow, Manager STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ___ day of _______________, 2020, by ___________________, the Manager of The Wealshire, LLC, a Minnesota limited liability company, on behalf of the company. ____________________________________ Notary Public B-1 EXHIBIT B TO DEVELOPMENT AGREEMENT [to be inserted] F-1 EXHIBIT F TO DEVELOPMENT AGREEMENT Site Improvement Cost Estimate [to be inserted] 1  AMENDMENT TO UPLAND BUFFER EASEMENT AGREEMENT THIS AMENDMENT TO UPLAND BUFFER EASEMENT AGREEMENT (the “Amendment”) is made this ____ day of ___________, 2020, by and between the city of Medina, a Minnesota municipal corporation (the “City”), and Parin A. Winter and Jeffrey C. Winter as Trustees of the Parin A. Winter Revocable Trust dated November 30, 2017 (the “Grantor”). RECITALS A. Grantor is the fee owner of property located in Hennepin County, Minnesota, legally described in Exhibit A attached hereto (the “Property”). B. The Property is subject to an Upland Buffer Easement (the “Upland Buffer Easement”), which was created by the Upland Buffer Easement Agreement (the “Agreement”). The Agreement was recorded in the office of the Hennepin County Recorder on July 8, 2011 as doc. no. A9672811. The Upland Buffer Easement is also referenced in the Master Declaration of Covenants for The Enclave recorded September 20, 2012 as doc. no. A9844055 and the Annexation Amendment to Amended and Restated Master Declaration of Covenants for The Enclave recorded on May 30, 2013 as doc. no. A09969201. C. City regulations permit the width of the Upland Buffer Easement to vary, provided certain requirements are met. D. Grantor desires to alter the location of the Upland Buffer Easement on the Property. E. The City has reviewed the request and determined that the proposed Amended Upland Buffer Easement is consistent with City regulations and agrees to the new location. Agenda Item # 5C 2  PROVISIONS In consideration of the mutual promises of the parties contained herein, the parties agree as follows: 1. Grantor hereby grants to the City a non-exclusive easement for upland buffer purposes, as such purposes are more fully described in the Agreement. The legal description of the Amended Upland Buffer Easement on the Property is included in Exhibit B, attached hereto. 2. The location of the Amended Upland Buffer Easement is depicted in Exhibit C, attached hereto. 3. The location of the Upland Buffer Easement shall be hereby amended to be located as described in this Amended Upland Buffer Easement instead of the location originally described. Except as explicitly noted in this Amendment, all other terms and conditions of the Agreement shall remain in full force and effect. 4. Grantor represents that Grantor owns the Property in fee simple, subject only to the encumbrances of record and has the right and authority to amend the Agreement as set forth herein. 5. Any notice required in this Amendment shall be delivered personally or sent by U.S. certified mail, return receipt requested: a) as to Grantor: Parin A. Winter and Jeffrey C. Winter 3153 Magnolia Drive Medina, MN 55340 b) as to City: City of Medina 2052 County Road 24 Medina, MN 55340 ATTN: City Administrator with a copy to: Ronald H. Batty Kennedy & Graven 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 or at such other address as either party may from time to time notify the other in writing in accordance with this paragraph. 6. The Agreement recorded as doc. no. A9672811 was also recorded against other parcels in addition to the Property. This Amendment affects only the Upland Buffer Easement on the Property and does not affect any other parcel against which the Agreement was originally recorded. 3  IN WITNESS WHEREOF, the parties to this Amended Upland Buffer Easement Agreement have caused these presents to be executed as of the day and year aforesaid. Parin A. Winter ______________________________ Jeffrey C. Winter STATE OF MINNESOTA ) ) ss. COUNTY OF ___________ ) This instrument was acknowledged before me this ____ day of ______________, 2020, by Parin A. Winter, Trustee of the Parin A. Winter Revocable Trust dated November 30, 2017. ____________________________________ Notary Public STATE OF MINNESOTA ) ) ss. COUNTY OF ___________ ) This instrument was acknowledged before me this ____ day of ______________, 2020, by Jeffrey C. Winter, Trustee of the Parin A. Winter Revocable Trust dated November 30, 2017 ____________________________________ Notary Public 4  CITY OF MEDINA By: Kathleen Martin, Mayor By: Scott T. Johnson, City Administrator STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ____ day of _______________, 2020, by Kathleen Martin and Scott T. Johnson, the mayor and city administrator, respectively, of the city of Medina, a Minnesota municipal corporation, on behalf of the municipal corporation. Notary Public This instrument drafted by: City of Medina (DDF) 2052 County Road 24 Medina, MN 55340 A-1  EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY Lot 12, Block 5, THE ENCLAVE AT MEDINA 2ND ADDITION, Hennepin County, Minnesota, according to the recorded plat thereof. B-1  EXHIBIT B LEGAL DESCRIPTION OF THE AMENDED UPLAND BUFFER EASEMENT     An upland buffer easement over, under, and across that part of Lot 12, Block 5, ENCLAVE AT MEDINA 2ND ADDITION, described as beginning at the westerly corner of said Lot 12, thence on an assumed bearing North 61 degrees 02 minutes 16 seconds East along the northwesterly line of said Lot 12, a distance of 24.42 feet; thence South 16 degrees 06 minutes 08 seconds East, a distance of 19.44 feet; thence South 27 degrees 29 minutes 37 seconds West, a distance of 11.79 feet; thence South 06 degrees 24 minutes 56 seconds East, a distance of 18.81 feet; thence South 19 degrees 17 minutes 36 seconds East, a distance of 22.68 feet; thence South 47 degrees 27 minutes 46 seconds East, a distance of 6.98 feet; thence South 77 degrees 53 minutes 53 seconds East, a distance of 8.26 feet; thence South 27 degrees 31 minutes 19 seconds East, a distance of 3.32 feet to the southerly line of said Lot 12; thence South 84 degrees 02 minutes 38 seconds West along said southerly line, a distance of 15.23 feet to the westerly line of said Lot 12; thence North 24 degrees 02 minutes 41 seconds West along said westerly line, a distance of 74.88 feet to the point of beginning.   C-1  EXHIBIT C DEPICTION OF AMENDED UPLAND BUFFER EASEMENT   MEMORANDUM TO: City Council, through City Administrator Scott Johnson FROM: Jim Stremel, City Engineer DATE: May 14, 2020 MEETING: May 19, 2020 SUBJECT: Arrowhead Drive Railroad Improvement Project – Agreements and Project Award Background: On January 21, 2020 the City Council adopted a resolution approving the Arrowhead Drive Railroad Improvement Project plans/specifications and authorized advertisement for bids. Bids were received electronically and opened at 10:00 AM on Friday, March 6, 2020. Since this time, staff have been working with both Hennepin County and MnDOT to finalize the two agreements required for this project. Project Bidding: Five bids were received with the apparent low bid submitted by Minger Construction Company, Inc. in the amount of $426,969.10. The low bid did come in above the engineer’s estimate of $354,364.00. The major items that accounted for the increase in cost included mobilization, railroad protective liability insurance, utility coordination, and storm sewer work. A summary of the project bid abstract is enclosed. Project Cost & Funding Review: The LRIP grant awarded to the City was in the amount of $450,000. The grant can cover the actual cost of construction for the implementation of the quiet zone and railroad crossing improvements with respect to the multi-use trail up to this amount, but overhead costs are not eligible such as engineering or legal cannot be reimbursed by this funding mechanism. An update to the major cost groupings based on the low bid amount along with the proposed method of payment has been provided in the table below. Description Amount Funding Source Surface Improvements $ 325,897.35 LRIP Storm Sewer $ 79,451.00 LRIP Trail Improvements $ 21,620.75 LRIP Contingency (5%) $ 21,348.46 LRIP Eligible CO Railroad Crossing Panels $ 18,000.00 LRIP Subtotal $ 466,317.56 Total LRIP Eligible Overhead (Eng/Legal) (Approx. 22%) $ 98,000.00 City Funds* Grand Total $ 564,317.56 LRIP/City Funds Agenda Items #5D, 5E, 5F 2 Although the bids came in higher than estimated, the total bid cost plus railroad crossing panels is within the $450,000 allotted to the City by the LRIP grant funding. After adding in a 5% contingency to cover unforeseen costs (change orders), the total amount has the potential to be above the allotted LRIP amount. The City has a balance of $92,000 of allocated funds for quiet zones. Anything in addition to $92,000 will be expended from the road fund or engineering funds. Agreements: There are two agreements required for this project. The first is a two-party agreement between the City and Hennepin County that generally addresses ownership, maintenance, and construction management of the proposed improvements. The second is a three-party agreement between the City, Hennepin County, and MnDOT which integrates the LRIP funding mechanism and will allow the City to be reimbursed for project costs with these funds. A separate resolution for each of these agreements has been included with this memo for City Council consideration. Next Steps: Assuming the City Council awards the project and approves both agreements as recommended, construction would likely start in June or July and be substantially complete in September. Once a pre-construction meeting is held, a more detailed construction schedule will be available. City Council Action Requested: There are three resolutions included with this memo for consideration: 1. Adopt the resolution approving the two-party agreement between the City and Hennepin County 2. Adopt the resolution approving the three-party agreement between the City, Hennepin County, and MnDOT (Exhibit E for Grant Agreement to State Transportation Fund Local Road Improvement Program Grant Terms and Conditions SAP 250-593-001 for the Arrowhead Drive Railroad Improvement Project) 3. Adopt the resolution accepting the low bid and awarding the contract to Minger Construction Co., Inc. for the Arrowhead Drive Railroad Improvement Project in the amount of $426,969.10. Agreement No. PW 22-36-20 County Project No. 2193100 County Road No. 118 City of Medina County of Hennepin 1 _____ CONSTRUCTION COOPERATIVE AGREEMENT This Agreement is made between the County of Hennepin, a body politic and corporate under the laws of the State of Minnesota, hereinafter referred to as the “County,” and the City of Medina, a Minnesota municipal corporation, hereinafter referred to as the “City.” The County and the City collectively are referred to as the “Parties.” Recitals The following Recitals are incorporated into this Agreement: 1. The City, in coordination with the Minnesota Department of Transportation (MnDOT) and the County, is planning to widen a segment of County Road (CR) 118 (Arrowhead Drive) at Trunk Highway (TH) 55 to incorporate railroad crossing safety improvements, a multi-use trail railroad crossing surface, raised medians within the roadway to facilitate the implementation of a whistle-less crossing (quiet zone), under County Project (CP) No. 2193100, City Project No. 13211-000, and which shall hereinafter be referred to as the “Project.” 2. The Parties have entered into a separate Agreement PW 17-40-20 (State Contract No. 1036577) with the Minnesota Department of Transportation to accept Local Road Improvement Program (LRIP) grant funds for the Project. 3. The Parties have agreed to enter into this Agreement to memorialize the partnership and to outline each party’s financial and maintenance responsibilities, and associated costs for the Project. 4. The City shall be the lead agency in design engineering, construction, and construction administration of the Project, and be responsible for acquiring all governmental permits required for the Project. 5. The City shall be responsible for obtaining a separate agreement with the Canadian Pacific (CP) Railway for right of way access and meeting other requirements of CP Railway for Project construction. 6. The Project will be carried out by the Parties under the provisions of Minnesota Statutes, Section 162.17, Subdivision 1, and Section 471.59. Agreement No. PW 22-36-20 CR 118; C.P. 2193100 2 _____ Agreement NOW, THEREFORE, the Parties agree as follows: 1. Term of Agreement and Survival of Terms. Effective Date. This Agreement is effective as of the date of the final signature. Expiration Date. This Agreement will expire after all obligations have been satisfactorily fulfilled. Survival of Terms. Provisions that by their nature are intended to survive the term, cancellation or termination of this Agreement do survive such term, cancellation or termination. Such provisions include but are not limited to: Maintenance Responsibilities, Records/Audits, Indemnification, Insurance, Worker Compensation Claims, Cancellation, Termination, and Minnesota Laws Govern. 2. The City’s Construction Responsibilities. Contract Award and Administration. The City or its agents shall prepare the necessary plans, specifications, and proposal; obtain approval of the plans and specifications from the Minnesota Department of Transportation (MnDOT), and the County; advertise for bids for the work and construction; receive and open bids pursuant to the advertisement; enter into a contract with the successful bidder at the unit prices specified in the bid of such bidder; administer the contract; and perform the required engineering and inspection; all in accordance with the plans and specifications set forth below. Plans and Specifications. 2.2.1. All design work performed by the City and its agents that is to be incorporated into the bidding documents for the Project shall be prepared and certified by a Professional Engineer licensed in the State of Minnesota. All designs which affect County facilities shall conform to the MnDOT Design Standards applicable to County State Aid Highways and be approved by the County Engineer. 2.2.2. The plans and specifications are referenced and identified as: S.A.P. 250-593-001, S.A.P. 250-593-002 and approved by MnDOT. 2.2.3. The City shall furnish the County with plans and specifications for review and approval as follows: electronic submittals at 60%, 90%, and 100%; comment response letter with 90% and 100% package; hard copy of plans at 100% with title sheet for county signature. Title sheet for county signature must arrive two weeks prior to Project advertisement and include the City signature. Upon completion of the Project, the City or its agents shall furnish the County with a complete set of as-built plans certified as Agreement No. PW 22-36-20 CR 118; C.P. 2193100 3 _____ to their accuracy by the City Engineer. The as-designed plans, specifications and as- built plans for the Project shall be provided by the City at no cost to the County. All designs and plans shall be submitted to Public Works Transportation Project Delivery Design Division Manager. 2.2.4. Permits and Approvals. The City shall obtain, and comply with, any and all permits and approvals required from other governmental or regulatory agencies to accomplish the Project. The permits and approvals shall be obtained prior to the start of any construction and made available to the County upon request. Construction Supervision and Inspection. The City or its agents will administer the construction contract, and perform all necessary engineering, inspection and testing of all the contract work. All work for the Project shall be completed in compliance with the County approved plans and specifications. The County Highway Engineer or designated representatives shall have the right, as the work progresses, to enter upon the job site to make any inspections deemed necessary and shall cooperate with the City Engineer and staff at their request to the extent necessary, but will have no responsibility for the supervision of the work. Plan Changes and Additional Construction. 2.4.1. The County agrees that the City may make changes in the plans or in the character of the contract construction that are reasonably necessary to cause the construction to be in all things performed and completed in a satisfactory manner. It is further agreed by the County that the City may, subject to the County’s rights under Section 2.2, enter into any change orders or supplemental agreements with the City’s contractor for the performance of any additional construction or construction occasioned by any necessary, advantageous or desirable changes in plans, within the original scope of the Project. 2.4.2. The County shall have the right to review any proposed changes to the plans and specifications prior to the work being performed, and in those instances where the proposed changes necessitate a re-engineering of the design and/or specifications, the City shall submit the re-engineered design and/or specifications to the County. The County Highway Engineer or designated representatives shall respond to the City’s request for approval to authorize the issuance of any negotiated change orders or supplemental agreements prepared by the City within a reasonable time frame. 3. The City’s Maintenance Responsibilities. Upon completion of the Project, the City shall provide for maintenance of the improvements as follows: Multi-use Trail. Maintenance of the newly constructed multi-use trail. Maintenance includes, but is not limited to, snow, ice and debris removal, patching, crack repair, and any other maintenance activities according to accepted city maintenance practices. 4. The County’s Maintenance Responsibilities. Upon completion of the Project, the County Agreement No. PW 22-36-20 CR 118; C.P. 2193100 4 _____ shall provide for maintenance of the improvements as follows: Roadways. Maintenance of CR 118 reconstructed under the Project. Maintenance includes, but is not limited to sweeping, snow, ice and debris removal, resurfacing and seal coating, and any other maintenance activities according to accepted county maintenance practices. County Road Pavement Striping. The County shall thereafter maintain and repair all pavement striping for roadway users installed as a part of the Project at the expense of the County. Raised Medians. The County shall thereafter maintain and repair the raised medians constructed as a part of the Project at the expense of the County. Storm Sewers. Maintenance of catch basins and associated lead pipes within or between the outermost curb lines of the County roadways and those within the radius return limits of intersecting municipal streets, at the expense of the County. 5. The County’s Cost Participation. There will not be any cost participation from the County for this Project. The City is the lead agency in the Project design and construction and shall assume all financial responsibilities of the Project. 6. Authorized Representatives. In order to coordinate the services of the County with the activities of the City, and vice versa so as to accomplish the purposes of this Agreement, the Hennepin County Highway Engineer and the City Engineer, or their designated representatives shall manage this Agreement on behalf of the County and the City. County of Hennepin, Public Works Transportation Carla Stueve County Highway Engineer 1600 Prairie Drive, Medina, MN 55340 Office: 612-596-0356 Carla.Stueve@hennepin.us City of Medina: Scott Johnson City Administrator 2052 County Rd 24, Medina, MN 55340 Office: 763-473-8840 scott.johnson@medinamn.gov 7. Assignment, Amendments, Default, Waiver, Agreement Complete, Cancellation or Termination. Assignment. The City shall not assign, subcontract, transfer or pledge this Agreement Agreement No. PW 22-36-20 CR 118; C.P. 2193100 5 _____ and/or the services to be performed hereunder, whether in whole or in part, without the prior written consent of the County. Amendments. Any alterations, variations, modifications or waivers of provisions of this Agreement shall only be valid when they have been reduced to writing as an amendment to this Agreement and signed by the Parties hereto. Default. If a party fails to perform any of the provisions of this Agreement or so fails to administer the work as to endanger the performance of the Agreement, this shall constitute a default. Unless the default is excused by the non-defaulting parties, the Parties may upon written notice immediately cancel this Agreement in its entirety. Waiver. The Parties’ failure to insist upon strict performance of any provision or to exercise any right under this Agreement shall not be deemed a relinquishment or waiver of the same, unless consented to in writing. Such consent shall not constitute a general waiver or relinquishment throughout the entire term of the Agreement. Agreement Complete. The entire Agreement between the Parties is contained herein and in the separate Agreement PW 17-40-20 (State Contract No. 1036577) with MnDOT, which supersedes all oral agreements and negotiations between the Parties relating to the subject matter hereof. All items referred to in this Agreement are incorporated or attached and are deemed to be part of this Agreement. Cancellation or Termination. This Agreement may be terminated or cancelled by each party with or without cause upon thirty (30) day written notice. This Agreement shall be terminated or cancelled by any party upon a material breach by the other party that is not waived by the non-breaching party. 8. Indemnification. The Parties agree to defend, indemnify and hold each other harmless, including their officials, officers, agents, volunteers, and employees from any liability, claims, causes of action, judgments, damages, losses, costs or expenses, including reasonable attorneys’ fees, resulting directly or indirectly from any act or omission of either party or either party’s consultant or sub consultant, anyone directly or indirectly employed by them, and/or anyone for whose acts and/or omissions they may be liable in the performance of the services required by this contract, and against all loss by reason of the failure of either party to perform fully, in any respect, all obligations under this contract. The Parties’ liability shall be governed by the provisions of Minnesota Statutes, Chapter 466 or other applicable law. 9. Insurance. The City agrees that any future contract let by the City for the performance of any of the work included hereunder shall include clauses that will: 1) Require the contractor to indemnify and hold the County, its commissioners, officers, agents and employees harmless from any liability, claim, demand, judgments, expenses, action or cause of action of any kind or character arising out of any act or omission of the contractor, its officers, employees, agents or subcontractors; 2) Require the contractor to be an independent contractor for the purposes of completing the work provided for in this Agreement; and 3) Require the Contractor to provide and maintain the following insurance so as to assure the performance of its Agreement No. PW 22-36-20 CR 118; C.P. 2193100 6 _____ indemnification and hold harmless obligation: Limits (1) Commercial General Liability on an occurrence Basis with contractual liability coverage: General Aggregate $2,000,000 Products - Completed Operations Aggregate $2,000,000 Personal and Advertising Injury $1,500,000 Each Occurrence - Combined Bodily Injury and Property Damage $1,500,000 Hennepin County shall be named as an additional insured for the Commercial General Liability coverage with respect to operations Covered under this Agreement. (2) Automobile Liability: Combined Single limit each occurrence coverage or the equivalent covering owned, non-owned, and hired automobiles: $1,500,000 (3) Workers’ Compensation and employer’s Liability: Work Workers’ Compensation: Statutory If the Contractor is based outside the State of Minnesota, coverage must apply to Minnesota laws. Employer’s Liability. Bodily injury by: Accident – Each Accident $500,000 Disease – Policy Limit $500,000 Disease - Each Employee $500,000 (4) Professional Liability – Per Claim and Aggregate: $2,000,000 The above listed Professional Liability insurance will not be required in any construction contract let by the City if the City’s Contractor is not required to perform design engineering as part of the construction contract. An umbrella or excess policy over primary liability coverages is an acceptable method to provide the required insurance limits. Agreement No. PW 22-36-20 CR 118; C.P. 2193100 7 _____ The above subparagraphs establish minimum insurance requirements. It is the sole responsibility of the City's Contractor to determine the need for and to procure additional insurance which may be needed in connection with the Project and any subsequent maintenance work covered under this Agreement. All insurance policies shall be open to inspection by the County and copies of policies shall be submitted to the County upon written request. 10. Worker Compensation Claims. Any and all employees of the City and all other persons engaged by the City in the performance of any work or services required or provided for herein to be performed by the City shall not be considered employees of the County, and any and all claims that may or might arise under the Workers' Compensation Act or the Unemployment Compensation Act of the State of Minnesota on behalf of the employees while so engaged and any and all claims made by any third parties as a consequence of any act or omission on the part of the employees while so engaged on any of the work or services provided to be rendered herein shall in no way be the obligation or responsibility of the County. Any and all employees of the County and all other persons engaged by the County in the performance of any work or services required or provided for herein to be performed by the County shall not be considered employees of the City, and any and all claims that may or might arise under the Workers' Compensation Act or the Unemployment Compensation Act of the State of Minnesota on behalf of the employees while so engaged and any and all claims made by any third parties as a consequence of any act or omission on the part of the employees while so engaged on any of the work or services provided to be rendered herein shall in no way be the obligation or responsibility of the City. 11. Records/Audits. The City agrees that the County, the State Auditor or any of their duly authorized representatives at any time during normal business hours, and as often as they may reasonably deem necessary, shall have access to and the right to examine, audit, excerpt and transcribe any books, documents, papers, records, etc., which are pertinent to the Project and maintenance work, and the accounting practices and procedures of the City which involve transactions relating to this Agreement. 12. Nondiscrimination. The provisions of Minnesota Statute Section 181.59 and of any applicable local ordinance relating to civil rights and discrimination and the Affirmative Action Policy statement of Hennepin County shall be considered a part of this Agreement as though fully set forth herein. 13. Minnesota Laws Govern. The laws of the State of Minnesota shall govern all questions and interpretations concerning the validity and construction of this Agreement and the legal relations between the Parties and their performance. The appropriate venue and jurisdiction for any litigation will be those courts located within the County of Hennepin, State of Agreement No. PW 22-36-20 CR 118; C.P. 2193100 8 _____ Minnesota. Litigation, however, in the federal courts involving the Parties will be in the appropriate federal court within the State of Minnesota. (This space left intentionally blank) Agreement No. PW 22-36-20 CR 118; C.P. 2193100 9 _____ IN TESTIMONY WHEREOF, The Parties hereto have caused this Agreement to be executed by their respective duly authorized officers as of the day and year first above written. CITY OF MEDINA Seal By: Mayor Date: ___________________________________ And: City Administrator Date: COUNTY OF HENNEPIN ATTEST: By: By:__________________________________ Deputy/Clerk of the County Board Chair of its County Board Date: Date: ________________________________ And: ________________________________ County Administrator Date: ________________________________ REVIEWED BY THE COUNTY ATTORNEY’S OFFICE: And:_________________________________ Assistant County Administrator, Public Works By: Date:________________________________ Assistant County Attorney Date: RECOMMENDED FOR APPROVAL By:_________________________________ County Highway Engineer Date:________________________________ RECOMMENDED FOR APPROVAL By:_________________________________ Department Director, Transportation Operations Date:________________________________ Resolution No. 2020-## May 19, 2020 Member _________ introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION NO. 2020-## A RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF CONSTRUCTION COOPERATIVE AGREEMENT WITH HENNEPIN COUNTY WHEREAS, the City of Medina (the “City”), in coordination with the Minnesota Department of Transportation and the County of Hennepin (the “County”), is planning to widen a segment of County Road 118 (Arrowhead Drive) at Trunk Highway 55 to incorporate railroad crossing safety improvements, a multi-use trail railroad crossing surface, raised medians within the roadway to facilitate the implementation of a whistle-less crossing (the “Project”); and WHEREAS, the City and County have prepared a Construction Cooperative Agreement to memorialize the partnership and to outline each party’s financial and maintenance responsibilities, and associated costs for the Project. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Medina, Minnesota, as follows: 1. The Construction Cooperative Agreement as presented at the May 19, 2020 City Council meeting is hereby approved. 2. The City Council hereby authorizes the Mayor and City Administrator to execute the Construction Cooperative Agreement on behalf of the City of Medina. Dated: May 19, 2020. _________________________ Kathleen Martin, Mayor Attest: ___________________________________ Jodi M. Gallup, City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member _________ and upon a vote being taken thereon, the following voted in favor thereof: Resolution No. 2020-## 2 May 19, 2020 And the following voted against same: Whereupon said resolution was declared duly passed and adopted. MnDOT Agreement No. 1036577 LOCAL ROAD IMPROVEMENT PROGRAM (LRIP) GRANT AGREEMENT This Agreement between the Minnesota Department of Transportation (“MnDOT”), the Grantee named below, and the County named below is made pursuant to Minnesota Statutes Section 174.52 and pursuant to Minn. Laws 2018, Chapter 214- H.F. 4425. The provisions in that section and the Exhibits attached hereto and incorporated by reference constitute this Agreement and the persons signing below agree to fully comply with all of the requirements of this Agreement. This Agreement will be effective on the date State obtains all required signatures under Minnesota Statutes §16C.05, subdivision 2. 1. Public Entity (Grantee) name, address and contact person: City of Medina 2052 County Road 24 Medina, MN 55340 Contact: Scott Johnson, City Administrator scott.johnson@medinamn.gov 763-473-8840 2. County (County) name, address and contact person: County of Hennepin 1600 Prairie Drive Medina, MN 55340 Contact: Tim Bruers Timothy.Bruers@hennepin.us 612-596-0393 3. Project(s): Name of Project & Project Number (See Exhibit C for location) Amount of LRIP Funds Amount of Required Matching Funds Completion Date Medina Arrowhead Dr. Rail Improvements SAP 250-593-001; SAP 250-593-002 $444,969.10 $0 9/30/2021 4. Total Amount of LRIP Grant for all projects under this Agreement: $444,969.10 MnDOT Agreement No. 1036577 5. The following Exhibits for each project are attached and incorporated by reference as part of this Agreement: Exhibit A Completed Sources and Uses of Funds Schedule Exhibit B Project Completion Schedule Exhibit C Bond Financed Property Certification Exhibit D Grant Application Exhibit E Grantee and County Resolutions Approving Grant Agreement Exhibit F General Terms and Conditions 6. Additional requirements, if any: 7. Any modification of this Agreement must be in writing and signed by all parties. (The remaining portion of this page was intentionally left blank.) MnDOT Agreement No. 1036577 COUNTY By: Title: Date:______________________________ By:______________________________ Title:______________________________ Date:______________________________ CITY OF MEDINA (GRANTEE) By: Title: Date:______________________________ By: Title: Date:______________________________ DEPARTMENT OF TRANSPORTATION Approval and Certifying Encumbrance By: Title: State Aid Programs Engineer Date: Office of Financial Management, Grant Unit By:___________________________________ Agency Grant Supervisor Date:_________________________________ OFFICE OF CONTRACT MANAGEMENT By: _________________________________ Contract Administrator Date:_________________________________ MnDOT Agreement No. 1036577 EXHIBIT A SOURCES AND USES OF FUNDS SCHEDULE SOURCES OF FUNDS USES OF FUNDS Entity Supplying Funds Amount Expenses Amount State Funds: Items Paid for with LRIP LRIP Grant (SAP 250-593-001) $426,969.10 Grant Funds: Force Accnt (SAP 250-593-002) $ 18,000.00 Railroad Crossing $ 37,500.00 Trail Improvements $ 21,620.75 Roadway Improvements__ $367,848.35 Pedestrian Crossing Impr. $ 18,000.00 Subtotal $ 444,969.10 Subtotal $444,969.10 Public Entity Funds: Items paid for with Non- Matching Funds LRIP Grant Funds: Grantee Funds Subtotal $0 Subtotal $0 TOTAL FUNDS $444,969.10 = TOTAL PROJECT COSTS $444,969.10 MnDOT Agreement No. 1036577 EXHIBIT B PROJECT COMPLETION SCHEDULE (Provide for enough time to final the project through the MnDOT state aid pay request process.) Completion Date : September 30, 2021 MnDOT Agreement No. 1036577 EXHIBIT C BOND FINANCED PROPERTY CERTIFICATION State of Minnesota General Obligation Bond Financed Property The undersigned states that it has a fee simple, leasehold and/or easement interest in the real property located in the County of Hennepin, State of Minnesota that is generally described or illustrated graphically in Attachment 1 attached hereto and all improvements thereon (the “Restricted Property”) and acknowledges that the Restricted Property is or may become State bond-financed property. To the extent that the Restricted Property is or becomes State bond- financed property, the undersigned acknowledges that: A. The Restricted Property is State bond-financed property under Minn. Stat. Sec. 16A.695, is subject to the requirements imposed by that statute, and cannot be sold, mortgaged, encumbered or otherwise disposed of without the approval of the Commissioner of Minnesota Management and Budget; and B. The Restricted Property is subject to the provisions of the Local Road Improvement Program Grant Agreement between the Minnesota Department of Transportation and the undersigned dated ________________, 20___; and C. The Restricted Property shall continue to be deemed State bond-financed property for 37.5 years or until the Restricted Property is sold with the written approval of the Commissioner of Minnesota Management and Budget. Date: __________________, 20____ _____________________________________ County of Hennepin, a political subdivision of the State of Minnesota By: ________________________________ Name: _______________________________ Title: _______________________________ By: ________________________________ Name: _______________________________ Title: _______________________________ MnDOT Agreement No. 1036577 Attachment 1 to Exhibit C GENERAL DESCRIPTION OF RESTRICTED PROPERTY (Insert a narrative or graphic description of the Restricted Property for the project. It need not be a legal description if a legal description is unavailable.) PROPOSED SECTION 13' THRU LANE 13' THRU LANE - 2 5' MEDIAN 12.5' TURN LANE 0% CP RAILROAD TO FURNISH AND INSTALL TWO 1219' CROSSING SURFACE PANELS (TOTAL OF IT OF CROSSING SURFACE EXTENSION) APPROX EX ' GATE LOCATION 11' THRU LANE 12.5' TURN LANE 13' THRU LANE EXISTING SECTION 12' THRU LANE 2.0% 12' TURN LANE 20%- 12' THRU LANE 13' TURN LANE wsb ARROWHEAD DRIVE RAILROAD QUIET ZONE PROJECT CITY OF MEDINA, MINNESOTA FIGURE 1 5' MEDIAN OPTION 2/12/2019 MnDOT Agreement No. 1036577 EXHIBIT D GRANT APPLICATION Attach the grant application for the project Local Road Improvement Program 2019 Application Form State Aid For Local Transportation Page 1 of 4 A. Applicant Information 1. Name (First & Last):2. Phone Number: 3. E-mail:4. Agency Name: 5. Street Address: 6. City:7. State:8. Zip Code: 9. Is the applicant a sponsor on this project? B. Project Location 1. MnDOT District:2. County: 3. City:4. Township: 5. Name of Road:6. Type of Road: 7.Road Authority (who owns and has jurisdiction of the road): 8. Project Termini: From 9. To: C. Project Description 1. Select type of project. 2.Provide a description and summary of the proposed project. Local Road Improvement Program 2019 Application Form State Aid For Local Transportation Page 2 of 4 D.Eligibility 1.Select the LRIP Account your project is eligible under. 2.Does your project meet one or more of the Routes of Regional Significance Criteria (select all that apply)? Farm to Market route Part of an economic development plan Provides capacity or congestion relief to a parallel trunk highway system or county road Part of a 10-ton route network Connect to regional tourist destination Is a connection to the IRC system, trunk highway or a county road 3. Describe the project contribution to the local, regional or state economic development or redevelopment efforts. E.Project Readiness 1.Construction Year: 2.Are there railroad impacts (railroad crossings or railroad tracks within 600’ of the project)? 3.What is the status of the engineering and design work on the project? Local Road Improvement Program 2019 Application Form State Aid For Local Transportation Page 3 of 4 F. Safety 1. Is this project or components of this project identified in a County Safety Plan? 2.Select the appropriate focus area your project/safety strategy align with in the Minnesota Strategic Highway Safety Plan. 3.Identify the transportation deficiency, type of crash, or safety hazard this project is trying to address. Respond even if project is in a county safety plan or the Minnesota Strategic Highway Safety Plan. 4. Describe how this project improves safety, reduce traffic crashes, fatalities, injuries, and property damages. Respond even if project is in a county safety plan or the Minnesota Strategic Highway Safety Plan. Local Road Improvement Program 2019 Application Form State Aid For Local Transportation Page 4 of 4 G.Multimodal/Complete Street Identify infrastructure improvements for non-motorized users on this project. H. Estimated Project Cost Source of Funding 1.LRIP Request: 2.Federal Funds: 3.State Aid Funds: 4.Local/Other Funds: 5.Total Project Cost: I. Attachments At least one project location map with routes labeled Engineer’s Estimate with an itemized breakdown Project schedule Local agency resolution Sponsor agency resolution (if applicable) Letters of concurrence or support When you are ready to submit the application, save the application form with LRIP, agency and road in the name of the document; e.g. LRIP_RamseyCounty_CSAH30.pdf. The application and attachments are due March 1, 2019. Applications and attachments should be submitted electronically to saltirhelp.dot@state.mn.us. More information on the program is available on the Local Road Improvement Program website, http://www.dot.state.mn.us/stateaid/lrip.html. If you have questions regarding this solicitation, contact Patti Loken at 651-366-3803 or patti.loken@state.mn.us. MnDOT Agreement No. 1036577 EXHIBIT E GRANTEE AND COUNTY RESOLUTIONS APPROVING GRANT AGREEMENT MnDOT Agreement No. 1036577 EXHIBIT F GENERAL TERMS AND CONDITIONS FOR LOCAL ROAD IMPROVEMENT PROGRAM (LRIP) GRANTS Article I DEFINITIONS Section 1.01 Defined Terms. The following terms shall have the meanings set out respectively after each such term (the meanings to be equally applicable to both the singular and plural forms of the terms defined) unless the context specifically indicates otherwise: “Advance(s)” - means an advance made or to be made by MnDOT to the Public Entity and disbursed in accordance with the provisions contained in Article VI hereof. “Agreement” - means the Local Road Improvement Program Grant Agreement between the Public Entity, the County, and the Minnesota Department of Transportation to which this Exhibit is attached. “Certification” - means the certification, in the form attached as Exhibit C, in which the County acknowledges that its interest in the Real Property is bond financed property within the meaning of Minn. Stat. Sec. 16A.695 and is subject to certain restrictions imposed thereby. “Code” - means the Internal Revenue Code of 1986, as amended, and all treasury regulations, revenue procedures and revenue rulings issued pursuant thereto. “Commissioner” - means the Commissioner of Minnesota Management & Budget. “Commissioner’s Order” - means the “Fourth Order Amending Order of the Commissioner of Minnesota Management & Budget Relating to Use and Sale of State Bond Financed Property” dated July 30, 2012, as it may be amended or supplemented. “Completion Date” - means the projected date for completion of the Project as indicated in the Agreement. “Construction Contract Documents” - means the document or documents, in form and substance acceptable to MnDOT, including but not limited to any construction plans and specifications and any exhibits, amendments, change orders, modifications thereof or supplements thereto, which collectively form the contract between the Public Entity and the Contractor(s) for the completion of the Construction Items on or before the Completion Date for either a fixed price or a guaranteed maximum price. “Construction Items” - means the work to be performed under the Construction Contract Documents. “Contractor” - means any person engaged to work on or to furnish materials and supplies for the Construction Items including, if applicable, a general contractor. “Draw Requisition” - means a draw requisition that the Public Entity, or its designee, submits to MnDOT when an Advance is requested, as referred to in Section 4.02. MnDOT Agreement No. 1036577 “G.O. Bonds” - means the state general obligation bonds issued under the authority granted in Article XI, Sec. 5(a) of the Minnesota Constitution, the proceeds of which are used to fund the LRIP Grant, and any bonds issued to refund or replace such bonds. “Grant Application” - means the grant application that the Public Entity submitted to MnDOT which is attached as Exhibit D. “LRIP Grant” - means a grant from MnDOT to the Public Entity under the LRIP in the amount specified in the Agreement, as such amount may be modified under the provisions hereof. “LRIP” - means the Local Road Improvement Program pursuant to Minn. Stat. Sec. 174.52 and rules relating thereto. “MnDOT” - means the Minnesota Department of Transportation. “Outstanding Balance of the LRIP Grant” - means the portion of the LRIP Grant that has been disbursed to the Public Entity minus any amounts returned to the Commissioner. “Project” - means the Project identified in the Agreement to be totally or partially funded with a LRIP grant. “Public Entity” - means the grantee of the LRIP Grant and identified as the Public Entity in the Agreement. “Real Property” - means the real property identified in the Agreement on which the Project is located. Article II GRANT Section 2.01 Grant of Monies. MnDOT shall make the LRIP Grant to the Public Entity and disburse the proceeds in accordance with the terms and conditions herein. Section 2.02 Public Ownership, The Public Entity and the County acknowledge and agree that the LRIP Grant is being funded with the proceeds of G.O. Bonds, and as a result all of the Real Property must be owned by one or more public entities. The County represents and warrants to MnDOT that it has one or more of the following ownership interests in the Real Property: (i) fee simple ownership, (ii) an easement that is for a term that extends beyond the date that is 37.5 years from the Agreement effective date, or such shorter term as authorized by statute, and which cannot be modified or terminated early without the prior written consent of MnDOT and the Commissioner; and/or (iii) a prescriptive easement for a term that extends beyond the date that is 37.5 years from the Agreement effective date. Section 2.03 Use of Grant Proceeds. The Public Entity shall use the LRIP Grant solely to reimburse itself for expenditures it has already made, or will make, to pay the costs of one of the following applicable activities: (i) preliminary, final construction and engineering and administration (ii) constructing or reconstructing city streets, county highways, or town roads with statewide or regional significance that have not been fully funded through other state, federal, or local funding sources; or (iii) capital improvement projects on county state-aid highways that are intended primarily to reduce traffic crashes, deaths, injuries, and property damage. The Public Entity shall not use the LRIP Grant for any other purpose, including but not limited to, any work to be done on a state trunk highway or within a trunk highway easement. MnDOT Agreement No. 1036577 Section 2.04 Operation of the Real Property. The Real Property must be used by the Public Entity or the County in conjunction with or for the operation of a county highway, county state-aid highway, town road, or city street and for other uses customarily associated therewith, such as trails and utility corridors, and for no other purposes or uses. The Public Entity and the County shall have no intention on the effective date of the Agreement to use the Real Property as a trunk highway or any part of a trunk highway. The Public Entity and the County must annually determine that the Real Property is being used for the purposes specified in this Section and, upon written request by either MnDOT or the Commissioner, shall supply a notarized statement to that effect. Section 2.05 Sale or Lease of Real Property. The County shall not (i) sell or transfer any part of its ownership interest in the Real Property, or (ii) lease out or enter into any contract that would allow another entity to use or operate the Real Property without the written consent of both MnDOT and the Commissioner. The sale or transfer of any part of the County’s ownership interest in the Real Property, or any lease or contract that would allow another entity to use or operate the Real Property, must comply with the requirements imposed by Minn. Stat. Sec. 16A.695 and the Commissioner’s Order regarding such sale or lease. Section 2.06 Public Entity’s and County’s Representations and Warranties. The Public Entity and the County, where applicable, represent and warrant to MnDOT that: A. It has legal authority to execute, deliver and perform the Agreement and all documents referred to therein, and it has taken all actions necessary to its execution and delivery of such documents. B. It has the ability and a plan to fund the operation of the Real Property for the purposes specified in Section 2.04 and will include in its annual budget all funds necessary for the operation of the Real Property for such purposes. C. The Agreement and all other documents referred to therein are the legal, valid and binding obligations of the Public Entity and County enforceable against the Public Entity and County in accordance with their respective terms. D. It will comply with all of the provisions of Minn. Stat. Sec. 16A.695, the Commissioner’s Order and the LRIP. It has legal authority to use the G.O. Grant for the purpose or purposes described in this Agreement. E. All of the information it has submitted or will submit to MnDOT or the Commissioner relating to the LRIP Grant or the disbursement of the LRIP Grant is and will be true and correct. F. It is not in violation of any provisions of its charter or of the laws of the State of Minnesota, and there are no actions or proceedings pending, or to its knowledge threatened, before any judicial body or governmental authority against or affecting it relating to the Real Property, or its ownership interest therein, and it is not in default with respect to any order, writ, injunction, decree, or demand of any court or any governmental authority which would impair its ability to enter into the Agreement or any document referred to herein, or to perform any of the acts required of it in such documents. G. Neither the execution and delivery of the Agreement or any document referred to herein nor compliance with any of the provisions or requirements of any of such documents is prevented by, is a breach of, or will result in a breach of, any provision of any agreement or document to which it is now a party or by which it is bound. MnDOT Agreement No. 1036577 H. The contemplated use of the Real Property will not violate any applicable zoning or use statute, ordinance, building code, rule or regulation, or any covenant or agreement of record relating thereto. I. The Project will be completed and the Real Property will be operated in full compliance with all applicable laws, rules, ordinances, and regulations of any federal, state, or local political subdivision having jurisdiction over the Project and the Real Property. J. All applicable licenses, permits and bonds required for the performance and completion of the Project and for the operation of the Real Property as specified in Section 2.04 have been, or will be, obtained. K. It reasonably expects to possess its ownership interest in the Real Property described in Section 2.02 for at least 37.5 years, and it does not expect to sell such ownership interest. L. It does not expect to lease out or enter into any contract that would allow another entity to use or operate the Real Property. M. It will supply whatever funds are needed in addition to the LRIP Grant to complete and fully pay for the Project. N. The Construction Items will be completed substantially in accordance with the Construction Contract Documents by the Completion Date and all such items will be situated entirely on the Real Property. O. It will require the Contractor or Contractors to comply with all rules, regulations, ordinances, and laws bearing on its performance under the Construction Contract Documents. P. It shall furnish such satisfactory evidence regarding the representations and warranties described herein as may be required and requested by either MnDOT or the Commissioner. Q. It has made no material false statement or misstatement of fact in connection with its receipt of the G.O. Grant, and all the information it has submitted or will submit to the State Entity or Commissioner of MMB relating to the G.O. Grant or the disbursement of any of the G.O. Grant is and will be true and correct. Section 2.07 Event(s) of Default. The following events shall, unless waived in writing by MnDOT and the Commissioner, constitute an Event of Default under the Agreement upon either MnDOT or the Commissioner giving the Public Entity and the County 30 days’ written notice of such event and the Public Entity’s or County’s failure to cure such event during such 30-day time period for those Events of Default that can be cured within 30 days or within whatever time period is needed to cure those Events of Default that cannot be cured within 30 days as long as the Public Entity or the County is using its best efforts to cure and is making reasonable progress in curing such Events of Default; however, in no event shall the time period to cure any Event of Default exceed six (6) months unless otherwise consented to, in writing, by MnDOT and the Commissioner. A. If any representation, covenant, or warranty made by the Public Entity or the County herein or in any other document furnished pursuant to the Agreement, or to induce MnDOT to disburse the LRIP Grant, shall prove to have been untrue or incorrect in any material respect or materially misleading as of the time such representation, covenant, or warranty was made. MnDOT Agreement No. 1036577 B. If the Public Entity or the County fails to fully comply with any provision, covenant, or warranty contained herein. C. If the Public Entity or the County fails to fully comply with any provision, covenant or warranty contained in Minn. Stat. Sec. 16A.695, the Commissioner’s Order, or Minn. Stat. Sec. 174.52 and all rules related thereto. D. If the Public Entity fails to use the proceeds of the LRIP Grant for the purposes set forth in Section 2.03, the Grant Application, and in accordance with the LRIP. E. If the Public Entity or the County fails to operate the Real Property for the purposes specified in Section 2.04. F. If the Public Entity fails to complete the Project by the Completion Date. G. If the County sells or transfers any portion of its ownership interest in the Real Property without first obtaining the written consent of both MnDOT and the Commissioner. H. If the Public Entity fails to provide any additional funds needed to fully pay for the Project. I. If the Public Entity or the County fails to supply the funds needed to operate the Real Property in the manner specified in Section 2.04. Notwithstanding the foregoing, any of the above events that cannot be cured shall, unless waived in writing by MnDOT and the Commissioner, constitute an Event of Default under the Agreement immediately upon either MnDOT or the Commissioner giving the Public Entity and the County written notice of such event. Section 2.08 Remedies. Upon the occurrence of an Event of Default and at any time thereafter until such Event of Default is cured to the satisfaction of MnDOT, MnDOT or the Commissioner may enforce any or all of the following remedies. A. MnDOT may refrain from disbursing the LRIP Grant; provided, however, MnDOT may make such disbursements after the occurrence of an Event of Default without waiving its rights and remedies hereunder. B. If the Event of Default involves a sale of the County’s interest in the Real Property in violation of Minn. Stat. Sec. 16A.695 or the Commissioner’s Order, the Commissioner, as a third party beneficiary of the Agreement, may require that the County pay the amounts that would have been paid if there had been compliance with such provisions. For other Events of Default by Public Entity or the County, the Commissioner may require that the Outstanding Balance of the LRIP Grant be returned to it. C. Either MnDOT or the Commissioner, as a third-party beneficiary of the Agreement, may enforce any additional remedies it may have in law or equity. The rights and remedies specified herein are cumulative and not exclusive of any rights or remedies that MnDOT or the Commissioner would otherwise possess. If the Public Entity does not repay the amounts required to be paid under this Section or under any other provision contained herein within 30 days of demand by the Commissioner, or any amount ordered by a court of competent jurisdiction within 30 days of entry of judgment against the Public Entity and in favor MnDOT Agreement No. 1036577 of MnDOT and/or the Commissioner, then such amount may, unless precluded by law, be offset against any aids or other monies that the Public Entity is entitled to receive from the State of Minnesota. Section 2.09 Notification of Event of Default. The Public Entity or the County shall furnish to MnDOT and the Commissioner, as soon as possible and in any event within seven (7) days after it has obtained knowledge of the occurrence of each Event of Default, a statement setting forth details of each Event of Default and the action which the Public Entity or the County proposes to take with respect thereto. Section 2.10 Effect of Event of Default. The Agreement shall survive Events of Default and remain in full force and effect, even upon full disbursement of the LRIP Grant, and shall only be terminated under the circumstances set forth in Section 2.11. Section 2.11 Termination of Agreement and Modification of LRIP Grant. A. If the Project is not started within five (5) years after the effective date of the Agreement or the LRIP Grant has not been disbursed within four (4) years after the date the Project was started, MnDOT’ s obligation to fund the LRIP Grant shall terminate. In such event, (i) if none of the LRIP Grant has been disbursed by such date, MnDOT shall have no obligation to fund the LRIP Grant and the Agreement will terminate, and (ii) if some but not all of the LRIP Grant has been disbursed by such date, MnDOT shall have no further obligation to provide any additional funding for the LRIP Grant and the Agreement shall remain in force but shall be modified to reflect the amount of the LRIP Grant that was actually disbursed and the Public Entity is still obligated to complete the Project by the Completion Date. B. The Agreement shall terminate upon the County’s sale of its interest in the Real Property and transmittal of the required portion of the proceeds of the sale to the Commissioner in compliance with Minn. Stat. Sec. 16A.695 and the Commissioner’s Order, or upon the termination of the County’s ownership interest in the Real Property if such ownership interest is an easement. Section 2.12 Excess Funds. If the full amount of the G.O. Grant and any matching funds referred to in Section 5.13 are not needed to complete the Project, then, unless language in the G.O. Bonding Legislation indicates otherwise, the G.O. Grant shall be reduced by the amount not needed. Article III COMPLIANCE WITH MINNESOTA STATUTE, SEC. 16A.695 AND THE COMMISSIONER’S ORDER Section 3.01 State Bond Financed Property. The County acknowledges that its interest in the Real Property is, or when acquired by it will be, “state bond financed property”, as such term is used in Minn. Stat. Sec. 16A.695 and the Commissioner’s Order and, therefore, the provisions contained in such statute and order apply, or will apply, to its interest in the Real Property, even if the LRIP Grant will only pay for a portion of the Project. Section 3.02 Preservation of Tax Exempt Status. In order to preserve the tax-exempt status of the G.O. Bonds, the Public Entity and the County, where applicable, agree as follows: A. It will not use the Real Property or use or invest the LRIP Grant or any other sums treated as “bond proceeds” under Section 148 of the Code (including “investment proceeds,” “invested sinking funds” and “replacement proceeds”) in such a manner as to cause the G.O. Bonds to be classified as “arbitrage bonds” under Code Section 148. MnDOT Agreement No. 1036577 B. It will deposit and hold the LRIP Grant in a segregated non-interest-bearing account until such funds are used for payments for the Project. C. It will, upon written request, provide the Commissioner all information required to satisfy the informational requirements set forth in the Code, including Sections 103 and 148, with respect to the G.O. Bonds. D. It will, upon the occurrence of any act or omission by the Public Entity or the County that could cause the interest on the G.O. Bonds to no longer be tax exempt and upon direction from the Commissioner, take such actions and furnish such documents as the Commissioner determines to be necessary to ensure that the interest to be paid on the G.O. Bonds is exempt from federal taxation, which such action may include: (i) compliance with proceedings intended to classify the G.O. Bonds as a “qualified bond” within the meaning of Code Section 141(e), or (ii) changing the nature of the use of the Real Property so that none of the net proceeds of the G.O. Bonds will be deemed to be used, directly or indirectly, in an “unrelated trade or business” or for any “private business use” within the meaning of Code Sections 141(b) and 145(a). E. It will not otherwise use any of the LRIP Grant or take, permit or cause to be taken, or omit to take, any action that would adversely affect the exemption from federal income taxation of the interest on the G.O. Bonds, and if it should take, permit or cause to be taken, or omit to take, as appropriate, any such action, it shall take all lawful actions necessary to correct such actions or omissions promptly upon obtaining knowledge thereof. Section 3.03 Changes to G.O. Compliance Legislation or the Commissioner’s Order. If Minn. Stat. Sec. 16A.695 or the Commissioner’s Order is amended in a manner that reduces any requirement imposed against the County, or if the County’s interest in the Real Property becomes exempted from Minn. Stat. Sec. 16A.695 and the Commissioner’s Order, then upon written request by the County, MnDOT shall execute an amendment to the Agreement to implement such amendment or exempt the County’s interest in the Real Property from Minn. Stat. Sec. 16A.695 and the Commissioner’s Order. Article IV DISBURSEMENT OF GRANT PROCEEDS Section 4.01 The Advances. MnDOT agrees, on the terms and subject to the conditions set forth herein, to make Advances of the LRIP Grant to the Public Entity from time to time in an aggregate total amount not to exceed the amount of the LRIP Grant. If the amount of LRIP Grant that MnDOT cumulatively disburses hereunder to the Public Entity is less than the amount of the LRIP Grant delineated in Section 1.01, then MnDOT and the Public Entity shall enter into and execute whatever documents MnDOT may request in order to amend or modify this Agreement to reduce the amount of the LRIP Grant to the amount actually disbursed. Provided, however, in accordance with the provisions contained in Section 2.11, MnDOT’s obligation to make Advances shall terminate as of the dates specified in Section 2.11 even if the entire LRIP Grant has not been disbursed by such dates. Advances shall only be for expenses that (i) are for those items of a capital nature delineated in Source and Use of Funds that is attached as Exhibit A, (ii) accrued no earlier than the effective date of the legislation that appropriated the funds that are used to fund the LRIP Grant, or (iii) have otherwise been consented to, in writing, by the Commissioner. It is the intent of the parties hereto that the rate of disbursement of the Advances shall not exceed the rate of completion of the Project or the rate of disbursement of the matching funds required, if any, under Section 5.13. Therefore, the cumulative amount of all Advances disbursed by the State Entity at any point in time MnDOT Agreement No. 1036577 shall not exceed the portion of the Project that has been completed and the percentage of the matching funds required, if any, under Section 5.13 that have been disbursed as of such point in time. This requirement is expressed by way of the following two formulas: Formula #1: Cumulative Advances < (Program Grant) × (percentage of matching funds, if any, required under Section 5.13 that have been disbursed) Formula #2: Cumulative Advances < (Program Grant) × (percentage of Project completed) Section 4.02 Draw Requisitions. Whenever the Public Entity desires a disbursement of a portion of the LRIP Grant the Public Entity shall submit to MnDOT a Draw Requisition duly executed on behalf of the Public Entity or its designee. Each Draw Requisition with respect to construction items shall be limited to amounts equal to: (i) the total value of the classes of the work by percentage of completion as approved by the Public Entity and MnDOT, plus (ii) the value of materials and equipment not incorporated in the Project but delivered and suitably stored on or off the Real Property in a manner acceptable to MnDOT, less (iii) any applicable retainage, and less (iv) all prior Advances. Notwithstanding anything herein to the contrary, no Advances for materials stored on or off the Real Property will be made by MnDOT unless the Public Entity shall advise MnDOT, in writing, of its intention to so store materials prior to their delivery and MnDOT has not objected thereto. At the time of submission of each Draw Requisition, other than the final Draw Requisition, the Public Entity shall submit to MnDOT such supporting evidence as may be requested by MnDOT to substantiate all payments which are to be made out of the relevant Draw Requisition or to substantiate all payments then made with respect to the Project. The final Draw Requisition shall not be submitted before completion of the Project, including any correction of material defects in workmanship or materials (other than the completion of punch list items). At the time of submission of the final Draw Requisition the Public Entity shall submit to MnDOT: (I) such supporting evidence as may be requested by MnDOT to substantiate all payments which are to be made out of the final Draw Requisition or to substantiate all payments then made with respect to the Project, and (ii) satisfactory evidence that all work requiring inspection by municipal or other governmental authorities having jurisdiction has been duly inspected and approved by such authorities and that all requisite certificates and other approvals have been issued. If on the date an Advance is desired the Public Entity has complied with all requirements of this Agreement and MnDOT approves the relevant Draw Requisition, then MnDOT shall disburse the amount of the requested Advance to the Public Entity. Section 4.03 Additional Funds. If MnDOT shall at any time in good faith determine that the sum of the undisbursed amount of the LRIP Grant plus the amount of all other funds committed to the Project is less than the amount required to pay all costs and expenses of any kind which reasonably may be anticipated in connection with the Project, then MnDOT may send written notice thereof to the Public Entity specifying the amount which must be supplied in order to provide sufficient funds to complete the Project. The Public Entity agrees that it will, within 10 calendar days of receipt of any such notice, supply or have some other entity supply the amount of funds specified in MnDOT's notice. Section 4.04 Condition Precedent to Any Advance. The obligation of MnDOT to make any Advance hereunder (including the initial Advance) shall be subject to the following conditions precedent: MnDOT Agreement No. 1036577 A. MnDOT shall have received a Draw Requisition for such Advance specifying the amount of funds being requested, which such amount when added to all prior requests for an Advance shall not exceed the amount of the LRIP Grant set forth in Section 1.01. B. No Event of Default under this Agreement or event which would constitute an Event of Default but for the requirement that notice be given or that a period of grace or time elapse shall have occurred and be continuing. C. No determination shall have been made by MnDOT that the amount of funds committed to the Project is less than the amount required to pay all costs and expenses of any kind that may reasonably be anticipated in connection with the Project, or if such a determination has been made and notice thereof sent to the Public Entity under Section 4.03, then the Public Entity has supplied, or has caused some other entity to supply, the necessary funds in accordance with such section or has provided evidence acceptable to MnDOT that sufficient funds are available. D. The State Entity shall have received evidence, in form and substance acceptable to the State Entity, that the Public Entity has sufficient funds to fully and completely pay for the Project and all other expenses that may occur in conjunction therewith. E. The Public Entity and the County have supplied to the State Entity all other items that the State Entity may reasonably require Section 4.05 Processing and Disbursement of Advances. The Public Entity acknowledges and agrees as follows: A. Advances are not made prior to completion of work performed on the Project. B. All Advances are processed on a reimbursement basis. C. The Public Entity must first document expenditures to obtain an Advance. D. Reimbursement requests are made on a partial payment basis or when the Project is completed. E. All payments are made following the “Delegated Contract Process or State Aid Payment Request” as requested and approved by the appropriate district state aid engineer. Section 4.06 Construction Inspections. The Public Entity and the County shall be responsible for making their own inspections and observations regarding the completion of the Project, and shall determine to its own satisfaction that all work done or materials supplied have been properly done or supplied in accordance with all contracts that the Public Entity has entered into regarding the completion of the Project. Article V MISCELLANEOUS Section 5.01 Insurance. If the Public Entity or the County elect to maintain general comprehensive liability insurance regarding the Real Property, then the Public Entity or the County shall have MnDOT named as an additional named insured therein. MnDOT Agreement No. 1036577 Section 5.02 Condemnation. If, after the County has acquired the ownership interest set forth in Section 2.02, all or any portion of the Real Property is condemned to an extent that the County can no longer comply with Section 2.04, then the County shall, at its sole option, either: (i) use the condemnation proceeds to acquire an interest in additional real property needed for the County to continue to comply with Section 2.04 and to provide whatever additional funds that may be needed for such purposes, or (ii) submit a request to MnDOT and the Commissioner to allow it to sell the remaining portion of its interest in the Real Property. Any condemnation proceeds which are not used to acquire an interest in additional real property shall be applied in accordance with Minn. Stat. Sec. 16A.695 and the Commissioner’s Order as if the County’s interest in the Real Property had been sold. If the County elects to sell its interest in the portion of the Real Property that remains after the condemnation, such sale must occur within a reasonable time period after the date the condemnation occurred and the cumulative sum of the condemnation and sale proceeds applied in accordance with Minn. Stat. Sec. 16A.695 and the Commissioner’s Order. If MnDOT receives any condemnation proceeds referred to herein, MnDOT agrees to or pay over to the County all of such condemnation proceeds so that the County can comply with the requirements of this Section. Section 5.03 Use, Maintenance, Repair and Alterations. The Public Entity and the County shall not, without the written consent of MnDOT and the Commissioner, (i) permit or allow the use of any of the Real Property for any purpose other than the purposes specified in Section 2.04, (ii) substantially alter any of the Real Property except such alterations as may be required by laws, ordinances or regulations, or such other alterations as may improve the Real Property by increasing its value or which improve its ability to be used for the purposes set forth in Section 2.04, (iii) take any action which would unduly impair or depreciate the value of the Real Property, (iv) abandon the Real Property, or (v) commit or permit any act to be done in or on the Real Property in violation of any law, ordinance or regulation. If the Public Entity or the County fails to maintain the Real Property in accordance with this Section, MnDOT may perform whatever acts and expend whatever funds necessary to so maintain the Real Property, and the Public Entity and the County irrevocably authorize MnDOT to enter upon the Real Property to perform such acts as may be necessary to so maintain the Real Property. Any actions taken or funds expended by MnDOT shall be at its sole discretion, and nothing contained herein shall require MnDOT to take any action or incur any expense and MnDOT shall not be responsible, or liable to the Public Entity, the County, or any other entity, for any such acts that are performed in good faith and not in a negligent manner. Any funds expended by MnDOT pursuant to this Section shall be due and payable on demand by MnDOT and will bear interest from the date of payment by MnDOT at a rate equal to the lesser of the maximum interest rate allowed by law or 18% per year based upon a 365-day year. Section 5.04 Recordkeeping and Reporting. The Public Entity and the County shall maintain books and records pertaining to Project costs and expenses needed to comply with the requirements contained herein, Minn. Stat. Sec. 16A.695, the Commissioner’s Order, and Minn. Stat. Sec. 174.52 and all rules related thereto, and upon request shall allow MnDOT, its auditors, the Legislative Auditor for the State of Minnesota, or the State Auditor for the State of Minnesota, to inspect, audit, copy, or abstract all of such items. The Public Entity and the County shall use generally accepted accounting principles in the maintenance of such items, and shall retain all of such books and records for a period of six years after the date that the Project is fully completed and placed into operation. Section 5.05 Inspections by MnDOT. The Public Entity and the County shall allow MnDOT to inspect the Real Property upon reasonable request by MnDOT and without interfering with the normal use of the Real Property. MnDOT Agreement No. 1036577 Section 5.06 Liability. The Public Entity, the County, and MnDOT agree that each will be responsible for its own acts and the results thereof to the extent authorized by law, and no party shall be responsible for the acts of another party and the results thereof. The liability of MnDOT and the Commissioner is governed by the provisions of Minn. Stat. Sec. 3.736. The liability of the County is governed by the provisions of Chapter 466. If the Public Entity is a “municipality” as that term is used in Minn. Stat. Chapter 466, then the liability of the Public Entity is governed by the provisions of Chapter 466. The Public Entity’s liability hereunder shall not be limited to the extent of insurance carried by or provided by the Public Entity, or subject to any exclusion from coverage in any insurance policy. Section 5.07 Relationship of the Parties. Nothing contained in the Agreement is to be construed as establishing a relationship of co-partners or joint venture among the Public Entity, the County, MnDOT, or the Commissioner, nor shall the Public Entity or the County be considered to be an agent, representative, or employee of MnDOT, the Commissioner, or the State of Minnesota in the performance of the Agreement or the Project. No employee of the Public Entity, the County, or other person engaging in the performance of the Agreement or the Project shall be deemed have any contractual relationship with MnDOT, the Commissioner, or the State of Minnesota and shall not be considered an employee of any of those entities. Any claims that may arise on behalf of said employees or other persons out of employment or alleged employment, including claims under the Workers’ Compensation Act of the State of Minnesota, claims of discrimination against the Public Entity, the County, or their officers, agents, contractors, or employees shall in no way be the responsibility of MnDOT, the Commissioner, or the State of Minnesota. Such employees or other persons shall not require nor be entitled to any compensation, rights or benefits of any kind whatsoever from MnDOT, the Commissioner, or the State of Minnesota, including tenure rights, medical and hospital care, sick and vacation leave, disability benefits, severance pay and retirement benefits. Section 5.08 Notices. In addition to any notice required under applicable law to be given in another manner, any notices required hereunder must be in writing and personally served or sent by prepaid, registered, or certified mail (return receipt requested), to the address of the party specified below or to such different address as may in the future be specified by a party by written notice to the others: To the Public Entity or the County: At the addresses indicated on the first page of the Agreement. To MnDOT at: Minnesota Department of Transportation Office of State Aid 395 John Ireland Blvd., MS 500 Saint Paul, MN 55155 Attention: Patti Loken, State Aid Programs Engineer To the Commissioner at: Minnesota Management & Budget 400 Centennial Office Bldg. 658 Cedar St. St. Paul, MN 55155 Attention: Commissioner Section 5.09 Assignment or Modification. Neither the Public Entity, the County, nor MnDOT may assign any of its rights or obligations under the Agreement without the prior written consent of the other party. MnDOT Agreement No. 1036577 Section 5.10 Waiver. Neither the failure by the Public Entity, the County, MnDOT, or the Commissioner, as a third party beneficiary of the Agreement, in one or more instances to insist upon the complete observance or performance of any provision hereof, nor the failure of the Public Entity, the County, MnDOT, or the Commissioner to exercise any right or remedy conferred hereunder or afforded by law shall be construed as waiving any breach of such provision or the right to exercise such right or remedy thereafter. In addition, no delay by any of the Public Entity, the County, MnDOT, or the Commissioner in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude other or further exercise thereof or the exercise of any other right or remedy. Section 5.11 Choice of Law and Venue. All matters relating to the validity, interpretation, performance, or enforcement of the Agreement shall be determined in accordance with the laws of the State of Minnesota. All legal actions arising from any provision of the Agreement shall be initiated and venued in the State of Minnesota District Court located in St. Paul, Minnesota. Section 5.12 Severability. If any provision of the Agreement is finally judged by any court to be invalid, then the remaining provisions shall remain in full force and effect and they shall be interpreted, performed, and enforced as if the invalid provision did not appear herein. Section 5.13 Matching Funds. Any matching funds as shown on Page 1 of the Grant Agreement that are required to be obtained and supplied by the Public Entity must either be in the form of (i) cash monies, (ii) legally binding commitments for money, or (iii) equivalent funds or contributions, including equity, which have been or will be used to pay for the Project. The Public Entity shall supply to MnDOT whatever documentation MnDOT may request to substantiate the availability and source of any matching funds. Section 5.14 Sources and Uses of Funds. The Public Entity represents to MnDOT and the Commissioner that the Sources and Uses of Funds Schedule attached as Exhibit A accurately shows the total cost of the Project and all of the funds that are available for the completion of the Project. The Public Entity will supply any other information and documentation that MnDOT or the Commissioner may request to support or explain any of the information contained in the Sources and Uses of Funds Schedule. If any of the funds shown in the Sources and Uses of Funds Schedule have conditions precedent to the release of such funds, the Public Entity must provide to MnDOT a detailed description of such conditions and what is being done to satisfy such conditions. Section 5.15 Project Completion Schedule. The Public Entity represents to MnDOT and the Commissioner that the Project Completion Schedule attached as Exhibit B correctly and accurately sets forth the projected schedule for the completion of the Project. Section 5.16 Third-Party Beneficiary. The Governmental Program will benefit the State of Minnesota and the provisions and requirements contained herein are for the benefit of both the State Entity and the State of Minnesota. Therefore, the State of Minnesota, by and through its Commissioner of MMB, is and shall be a third-party beneficiary of this Agreement. Section 5.17 Public Entity Tasks. Any tasks that the Agreement imposes upon the Public Entity or the County may be performed by such other entity as the Public Entity or the County may select or designate, provided that the failure of such other entity to perform said tasks shall be deemed to be a failure to perform by the Public Entity or the County. Section 5.18 Data Practices. The Public Entity and the County agree with respect to any data that they possess regarding the G.O. Grant or the Project to comply with all of the provisions and restrictions MnDOT Agreement No. 1036577 contained in the Minnesota Government Data Practices Act contained in Minnesota Statutes Chapter 13, as such may subsequently be amended or replaced from time to time. Section 5.19 Non-Discrimination. The Public Entity and the County agree to not engage in discriminatory employment practices regarding the Project and they shall fully comply with all of the provisions contained in Minnesota Statutes Chapters 363A and 181, as such may subsequently be amended or replaced from time to time. Section 5.20 Worker’s Compensation. The Public Entity and the County agree to comply with all of the provisions relating to worker’s compensation contained in Minn. Stat. Secs. 176.181 subd. 2 and 176.182, as they may be amended or replaced from time to time with respect to the Project. Section 5.21 Antitrust Claims. The Public Entity and the County hereby assign to MnDOT and the Commissioner of MMB all claims they may have for over charges as to goods or services provided with respect to the Project that arise under the antitrust laws of the State of Minnesota or of the United States of America. Section 5.22 Prevailing Wages. The Public Entity and the County agree to comply with all of the applicable provisions contained in Minnesota Statutes Chapter 177, and specifically those provisions contained in Minn. Stat.§. 177.41 through 177.435 as they may be amended or replaced from time to time with respect to the Project. By agreeing to this provision, the Public Entity and the County are not acknowledging or agreeing that the cited provisions apply to the Project. Section 5.23 Entire Agreement. The Agreement and all of the exhibits attached thereto embody the entire agreement between the Public Entity, the County, and MnDOT, and there are no other agreements, either oral or written, between the Public Entity, the County, and MnDOT on the subject matter hereof. Section 5.24 E-Verification. The Public Entity and the County agree and acknowledge that they are aware of Minn.Stat. § 16C.075 regarding e-verification of employment of all newly hired employees to confirm that such employees are legally entitled to work in the United States, and that they will, if and when applicable, fully comply with such order. MnDOT Agreement No. 1036577 Resolution No. ________ May 19, 2020 Member ___________ introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION NO. _______ EXHIBIT E FOR GRANT AGREEMENT TO STATE TRANSPORTATION FUND LOCAL ROAD IMPROVEMENT PROGRAM GRANT TERMS AND CONDITIONS SAP 250-593-001 WHEREAS, the City of Medina has applied to the Commissioner of Transportation for a grant from the Minnesota State Transportation Fund for Local Road Improvement; and WHEREAS, the Commissioner of Transportation has given notice that funding for this project is available; and WHEREAS, the amount of the grant has been determined to be $444,969.10 by reason of the lower responsible bid; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Medina, Minnesota, as follows: 1. The City of Medina does hereby agree to the terms and conditions of the grant consistent with Minnesota Statutes, section 174.52 and will pay any additional amount by which the cost exceeds the estimate and will return to the Minnesota State Transportation Fund any amount appropriated for the project but not required. 2. The City Council hereby authorizes the Mayor and City Administrator to execute a grant agreement on behalf of the City of Medina and any amendments thereto with the Commissioner of Transportation concerning the above-referenced grant. Dated: May 19, 2020 _________________________ Kathleen Martin, Mayor Attest: ___________________________________ Jodi M. Gallup, City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member ___________ and upon a vote being taken thereon, the following voted in favor thereof: Resolution No. ________ May 19, 2020 2 And the following voted against same: Whereupon said resolution was declared duly passed and adopted. PROJECT: Arrowhead Drive Railroad Crossing Improvements S.A.P. 250-593-001 OWNER: City of Medina, MN WSB PROJECT NO.: 013211-000 BIDS OPENED: Friday, March 6, 2020, at 10:00 a.m. Local Time Contractor Bid Bond (5%) Add. Nos. 1, 2, & 3 Rec'd.Grand Total Bid 1 Minger Construction Co., Inc. X X $426,969.10 2 New Look Contracting, Inc. X X $444,318.00 3 Meyer Contracting, Inc. X X $444,752.50 4 Urban Companies X X $477,369.00 5 GL Contracting, Inc. X X $509,437.90 Engineer's Estimate $354,364.00 Denotes corrected figure James L. Stremel, PE, Sr. Project Manager BID TABULATION SUMMARY I hereby certify that this is a true and correct tabulation of the bids as received on March 6, 2020. K:\013211-000\Admin\Construction Admin\Bidding & Contracts\013211-000 CST Bid Tab Summary-030620 Resolution No. ________ May 19, 2020 Member ___________ introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION NO. _______ RESOLUTION ACCEPTING BIDS AND AWARDING THE CONTRACT WHEREAS, pursuant to an advertisement for bids for the Arrowhead Drive Railroad Improvement Project, the improvement of Arrowhead Drive south of TH 55 by constructing a raised concrete median, pedestrian railroad crossing panels and other improvements, bituminous pavement patching, installation of storm sewer, and pavement striping, bids were received, opened electronically, and tabulated according to the law, and the following three bids were received complying with the advertisement: Company Grand Total Bid Minger Construction Co., Inc. $426,696.10 New Look Contracting, Inc. $444,318.00 Meyer Contracting, Inc. $444,752.50 Urban Companies $477,369.00 GL Contracting, Inc. $509,437.90 AND WHEREAS, it appears that Minger Construction Co., Inc. of Jordan, MN is the lowest responsible bidder for the Grand Total Bid. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Medina, Minnesota, as follows: 1. The Mayor and City Administrator are hereby authorized and directed to enter into the attached contract with Minger Construction Co., Inc. in the name of the City of Medina for the improvement of a city roadway on Arrowhead Drive south of TH 55 by constructing a raised concrete median, pedestrian railroad crossing panels and other improvements, bituminous pavement patching, installation of storm sewer, and pavement striping, according to the plans and specifications therefor approved by the City Council and on file in the office of the City Administrator. 2. The City Administrator is hereby authorized and directed to return forthwith to all bidders the deposits made with their bids, except that the deposits of the successful bidder and the next lowest bidder shall be retained until a contract has been signed. Resolution No. ________ May 19, 2020 2 Dated: May 19, 2020. _________________________ Kathleen Martin, Mayor Attest: ___________________________________ Jodi M. Gallup, City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member ___________ and upon a vote being taken thereon, the following voted in favor thereof: And the following voted against same: Whereupon said resolution was declared duly passed and adopted. Planning Commission Page 1 of 1 May 19, 2020 Resignation City Council Meeting MEMORANDUM TO: Mayor Martin and Members of the City Council FROM: Dusty Finke, Planning Director; through City Administrator Scott Johnson DATE: May 14, 2020 MEETING: May 19, 2020 City Council SUBJ: Planning Commission Resignation Resignation Planning Commissioner Aaron Amic is planning to move out of the City in June and, as a result, has submitted his resignation from the Planning Commission. Aaron’s resignation is attached. Filling Vacancy Staff has consulted with Mayor Martin, City Council liaison Todd Albers, and Planning Commission Chair Robin Reid related to filling the vacancy in the term, which expires at the end of 2020. The group intends to review applications for the appointments at the beginning of the year, some of which were not able to be appointed. After review and confirming interest, the group will either recommend appointment of a previous candidate or seek additional applicants. Recommended Action Motion to adopt a resolution accepting resignation of Aaron Amic from the Planning Commission. Attachments 1. Resolution 2. Resignation Letter Agenda Item # 5G Resolution No. 2020-## DATE Member __________ introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION NO. 2020-## RESOLUTION ACCEPTING RESIGNATION OF AARON AMIC FROM THE PLANNING COMMISSION WHEREAS, on January 2, 2018, the City Council appointed Aaron Amic to the Planning Commission, with a term to expire on December 31, 2020; and WHEREAS, on May 13, 2020, Mr. Amic submitted a letter of resignation from his position on the Planning Commission. NOW, THEREFORE, BE IT RESOLVED by the city council of the city of Medina that Aaron Amic’s letter of resignation from the Planning Commission is hereby accepted. Dated: ______________________________ Kathleen Martin, Mayor ATTEST: _______________________________ Jodi M. Gallup, City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member _____ and upon vote being taken thereon, the following voted in favor thereof: And the following voted against same: Whereupon said resolution was declared duly passed and adopted. 1 Dusty Finke From:Aaron Amic <aaronjamic@gmail.com> Sent:Wednesday, May 13, 2020 4:46 PM To:Dusty Finke Subject:Resignation Hi Dusty,    As discussed and finalized over the past couple months, I will be moving and while we looked around Medina, the house  that jumped out at us is in Orono.  I love the city of Medina and will continue of course to be a business owner here.  It is  a special city and the people who work for the city and serve on the commission and council are amazing people who I  will miss working with on city issues.    I am very sorry to send this resignation letter but I am sure we’ll cross paths again.  You are the best city planner a city  could ever hope for and I have often been in awe of your preparation and knowledge.  Thanks for letting me serve these  past three years!    Thank you,  Aaron Amic  612‐281‐7014   City of Medina Medina, Minnesota For the Year Ended December 31, 2019 Annual Financial Report THIS PAGE IS LEFT BLANK INTENTIONALLY City of Medina, Minnesota Annual Financial Report Table of Contents For the Year Ended December 31, 2019 Page No. Introductory Section Elected and Appointed Officials 9 Financial Section Independent Auditor’s Report 13 Management’s Discussion and Analysis 17 Basic Financial Statements Government-wide Financial Statements Statement of Net Position 29 Statement of Activities 30 Fund Financial Statements Governmental Funds Balance Sheet 34 Reconciliation of the Balance Sheet to the Statement of Net Position 35 Statement of Revenues, Expenditures and Changes in Fund Balances 36 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities 37 General Fund Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 39 Proprietary Funds Statement of Net Position 40 Statement of Revenues, Expenses and Changes in Net Position 43 Statement of Cash Flows 44 Notes to the Financial Statements 47 Required Supplementary Information Schedule of Employer’s Share of Public Employees Retirement Association Net Pension Liability - General Employees Retirement Fund 78 Schedule of Employer’s Public Employees Retirement Association Contributions - General Employees Retirement Fund 78 Notes to the Required Supplementary Information - General Employees Retirement Fund 79 Schedule of Employer’s Share of Public Employees Retirement Association Net Pension Liability - Public Employees Police and Fire Fund 80 Schedule of Employer’s Public Employees Retirement Association Contributions - Public Employees Police and Fire Fund 80 Notes to the Required Supplementary Information - Public Employees Police and Fire Fund 81 Schedule of Changes in the City’s Total OPEB Liability 83 3 THIS PAGE IS LEFT BLANK INTENTIONALLY 4 City of Medina, Minnesota Annual Financial Report Table of Contents (Continued) For the Year Ended December 31, 2019 Page No. Combining and Individual Fund Financial Statements and Schedules Nonmajor Governmental Funds Combining Balance Sheet 86 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 87 Nonmajor Special Revenue Funds Combining Balance Sheet 88 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 90 Nonmajor Capital Projects Funds Combining Balance Sheet 92 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 94 General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 96 Debt Service Funds Combining Balance Sheet 100 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances 102 Summary Financial Report Revenues and Expenditures for General Operations - Governmental Funds 104 Other Required Report Independent Auditor’s Report on Minnesota Legal Compliance 107 5 THIS PAGE IS LEFT BLANK INTENTIONALLY 6 INTRODUCTORY SECTION CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 7 THIS PAGE IS LEFT BLANK INTENTIONALLY 8 City of Medina, Minnesota Elected and Appointed Officials For the Year Ended December 31, 2019 Name Title Term Expires Kathleen Martin Mayor 12/31/20 John Anderson Council Member 12/31/20 Jeff Pederson Council Member 12/31/20 Todd Albers Council Member 12/31/22 Dino DesLauriers Council Member 12/31/22 Name Title Scott Johnson City Administrator Erin Barnhart Finance Director Jodi Gallup Assistant City Administrator/City Clerk ELECTED APPOINTED 9 THIS PAGE IS LEFT BLANK INTENTIONALLY 10 FINANCIAL SECTION CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 11 THIS PAGE IS LEFT BLANK INTENTIONALLY 12 INDEPENDENT AUDITOR’S REPORT Honorable Mayor and City Council City of Medina, Minnesota Report on the Financial Statements We have audited the accompanying financial statements of governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Medina, Minnesota (the City), as of and for the year ended December 31, 2019, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City as of December 31, 2019, and the respective changes in financial position and, where applicable, cash flows thereof and the budgetary comparison for the General fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. 13 THIS PAGE IS LEFT BLANK INTENTIONALLY 14 Change in Accounting Standards As described in Note 10 to the financial statements, the City adopted the provisions of Governmental Accounting Standard Board (GASB) Statement No. 84, Fiduciary Activities, for the year ended December 31, 2019. Adoption of the provisions of these statements results in changes to the classifications of the components of the financial statements. Our opinion is not modified with respect to this m atter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis starting on page 17 and the Schedules of Employer’s Share of the Net Pension Liability, the Schedules of Employer’s Contributions, the related note disclosures, and the Schedule of Changes in the City’s OPEB liability starting on page 78 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquires of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquires, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming an opinion on the basic financial statements that collectively comprise the City’s basis financial statements. The introductory section and combining and individual fund financial statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual fund financial statements and schedules are fairly stated, in all material respects, in relation to the financial statements as a whole. The introductory section has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on it. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated May 12, 2020, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance. ABDO, EICK & MEYERS, LLP Minneapolis, Minnesota May 12, 2020 15 THIS PAGE IS LEFT BLANK INTENTIONALLY 16 Management’s Discussion and Analysis As management of the City of Medina, Minnesota (the City), we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2019. Financial Highlights • The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $45,418,136 (net position). Of this amount, $13,110,724 (unrestricted net position) may be used to meet the City’s ongoing obligations to citizens and creditors. • The total net position of governmental activities increased by $2,745,814 and total net position of the business- type activities increased by $1,854,996. This resulted in an increase to total net position of $4,600,810 for the City. The increase is mainly due to capital contributions from developers totaling $2,553,000. • As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $13,549,160, an increase of $1,164,873 in comparison with the prior year. • At the end of the current fiscal year, unassigned fund balance for the General fund was $2,933,435, or 57.7 percent of total General fund expenditures and transfers out. • The City’s total debt decreased $1,420,657, or 11.3 percent during the current fiscal year mainly due to regularly scheduled principal payments made on outstanding debt. 17 Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements comprise of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplemental information in addition to the basic financial statements themselves. The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of combining and individual fund financial statements and schedules that further explains and supports the information in the financial statements. Figure 1 shows how the required parts of this annual report are arranged and relate to one another. In addition to these required elements, we have included a section with combining and individual fund financial statements and schedules that provide details about nonmajor governmental funds, which are added together and presented in single columns in the basic financial statements. Figure 1 Required Components of the City’s Annual Financial Report Management's Discussion and Analysis Basic Financial Statements Required Supplementary Information Government- wide Financial Statements Fund Financial Statements Notes to the Financial Statements Summary Detail 18 Figure 2 summarizes the major features of the City’s financial statements, including the portion of the City government they cover and the types of information they contain. The remainder of this overview section of management’s discussion and analysis explains the structure and contents of each of the statements. Figure 2 Major Features of the Government-wide and Fund Financial Statements Fund Financial Statements Government-wide Statements Governmental Funds Proprietary Funds Scope Entire City government (except fiduciary funds) The activities of the City that are not proprietary or fiduciary, such as police, fire and parks Activities of the City that operates similar to private businesses, such as the water and sewer systems Required financial statements • Statement of Net Position • Statement of Activities • Balance Sheet • Statement of Revenues, Expenditures, and Changes in Fund Balances • Statements of Net Position • Statements of Revenues, Expenses and Changes in Fund Net Position • Statements of Cash Flows Accounting basis and measurement focus Accrual accounting and economic resources focus Modified accrual accounting and current financial resources focus Accrual accounting and economic resources focus Type of asset/liability information All assets and liabilities, both financial and capital, as well as short-term and long- term Only assets expected to be used up and liabilities that come due during the year or soon thereafter; no capital assets included All assets and liabilities, both financial and capital, as well as short-term and long-term Type of deferred outflows/inflows of resources information All deferred outflows/inflows of resources, regardless of when cash is received or paid Only deferred outflows of resources expected to be used up and deferred inflows of resources that come due during the year or soon thereafter; no capital assets included All deferred outflows/inflows of resources, regardless of when cash is received or paid Type of inflow/outflow information All revenues and expenses during the year, regardless of when cash is received or paid Revenues for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and payment is due during the year or soon thereafter All revenues and expenses during the year, regardless of when cash is received or paid Government-wide Financial Statements. The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business. The statement of net position presents information on all of the City’s assets and deferred outflows of resources and liabilities and deferred inflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). 19 Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, streets and highways, sanitation and recycling, culture and recreation, economic development, miscellaneous and interest on long-term debt. The business-type activities of the City include water, sanitary sewer, and storm water. The government-wide financial statements start on page 29 of this report. Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into two categories: governmental funds and proprietary funds. Governmental Funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact by the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains numerous individual governmental funds, nine of which are Debt Service funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General fund, Debt Service fund, and the Sewer Capital Improvements fund, all of which are considered to be major funds. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements or schedules elsewhere in this report. The City adopts an annual appropriated budget for its General fund. A budgetary comparison statement has been provided for the General fund to demonstrate compliance with this budget. The basic governmental fund financial statements start on page 34 of this report. Proprietary Funds. The City maintains one type of proprietary fund. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water, sanitary sewer and storm sewer. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for each of the three enterprise funds, all of which are considered to be major funds of the City. The basic proprietary fund financial statements start on page 40 this report. Notes to the Financial Statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements start on page 47 of this report. Other Information. The combining statements referred to earlier in connection with nonmajor governmental funds are presented following the notes to the financial statements. Combining and individual fund statements and schedules start on page 86 of this report. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City’s progress in funding its obligation to provide pension and other post- employment benefits to its employees. Required supplementary information can be found starting on page 78 of this report. 20 Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $45,418,136 at the close of the most recent fiscal year. By far, the largest portion of the City’s net position (61.3 percent) reflects its investment in capital assets (e.g., land, buildings, machinery and equipment), less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. City of Medina’s Summary of Net Position Increase Increase 2019 2018 (Decrease) 2019 2018 (Decrease) Assets Current and other assets 17,263,227$ 15,808,067$ 1,455,160$ 5,315,109$ 4,734,941$ 580,168$ Capital assets 26,274,363 25,089,057 1,185,306 12,593,515 11,914,762 678,753 Total Assets 43,537,590 40,897,124 2,640,466 17,908,624 16,649,703 1,258,921 Deferred Outflows of Resources 1,104,251 1,349,562 (245,311) 20,889 42,383 (21,494) Liabilities Noncurrent liabilities outstanding 12,110,504 12,876,608 (766,104) 1,451,108 2,056,802 (605,694) Other liabilities 1,834,134 1,153,143 680,991 45,989 46,338 (349) Total Liabilities 13,944,638 14,029,751 (85,113) 1,497,097 2,103,140 (606,043) Deferred Inflows of Resources 1,667,293 1,932,839 (265,546) 44,190 55,716 (11,526) Net Position Net investment in capital assets 16,439,841 14,239,264 2,200,577 11,402,682 10,143,543 1,259,139 Restricted 4,464,889 4,482,055 (17,166) - - - Unrestricted 8,125,180 7,562,777 562,403 4,985,544 4,389,687 595,857 Total Net Position 29,029,910$ 26,284,096$ 2,745,814$ 16,388,226$ 14,533,230$ 1,854,996$ Governmental Activities Business-type Activities An additional portion of the City’s net position (9.8 percent) represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position $13,110,724 may be used to meet the City’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all three categories of net position, both for the City as a whole, as well as for its separate governmental and business-type activities. The same situation held true for the prior fiscal year. 21 Governmental Activities. Governmental activities increased the City’s net position by $2,745,814. Key elements of this increase are as follows: City of Medina’s Changes in Net Position Increase Increase 2019 2018 (Decrease) 2019 2018 (Decrease) Revenues Program Revenues Charges for services 1,254,827$ 983,365$ 271,462$ 2,103,976$ 2,105,158$ (1,182)$ Operating grants and contributions 420,950 366,506 54,444 439 1,586 (1,147) Capital grants and contributions 2,809,171 1,883,427 925,744 1,259,302 11,555 1,247,747 General Revenues Property taxes 4,063,049 3,914,577 148,472 - - - Tax increments 491,715 436,528 55,187 - - - Franchise taxes 61,648 57,688 3,960 - - - Grants and contributions not restricted to specific programs 31,331 17,869 13,462 - - - Unrestricted investment earnings 431,793 153,109 278,684 143,725 48,816 94,909 Gain on sale of capital assets 35,880 39,173 (3,293) - - - Total Revenues 9,600,364 7,852,242 1,748,122 3,507,442 2,167,115 1,340,327 Expenses General government 1,319,665 1,133,831 185,834 - - - Public safety 2,755,337 2,563,683 191,654 - - - Streets and highways 1,803,752 1,239,728 564,024 - - - Sanitation and recycling 15,311 12,415 2,896 - - - Culture and recreation 471,625 499,008 (27,383) - - - Economic development 203,234 208,617 (5,383) - - - Interest on long-term debt 211,132 226,983 (15,851) - - - Water - - - 840,718 983,624 (142,906) Sewer - - - 691,716 888,224 (196,508) Storm water - - - 194,506 180,344 14,162 Total Expenses 6,780,056 5,884,265 895,791 1,726,940 2,052,192 (325,252) Change in Net Position Before Transfers 2,820,308 1,967,977 852,331 1,780,502 114,923 1,665,579 Transfers - Capital Assets (22,321) (132,082) 109,761 22,321 132,082 (109,761) Transfers (52,173) 179,440 (231,613) 52,173 (179,440) 231,613 Change in Net Position 2,745,814 2,015,335 730,479 1,854,996 67,565 1,787,431 Net Position, January 1 26,284,096 24,268,761 2,015,335 14,533,230 14,465,665 67,565 Net Position, December 31 29,029,910$ 26,284,096$ 2,745,814$ 16,388,226$ 14,533,230$ 1,854,996$ Governmental Activities Business-type Activities Capital contributions increased $925,744 mainly due to contributions from developers. Charges for services increased $271,462 mainly due to public safety and streets and highways. Property taxes represent 42.3 percent of total revenues in 2019 in governmental activities. 22 The following graph depicts various governmental activities and shows the revenue and expenses directly related to those activities. Expenses and Program Revenue - Governmental Activities $- $300,000 $600,000 $900,000 $1,200,000 $1,500,000 $1,800,000 $2,100,000 $2,400,000 $2,700,000 $3,000,000 Expenses Revenues Revenue by Source - Governmental Activities Charges for Services 13.0% Operating Grants and Contributions 4.4% Capital Grants and Contributions 29.3% Taxes 48.1% Grants and Contributions Not Restricted to Specific Programs 0.3% Unrestricted Investment Earnings 4.5% Gain on Sale of Capital Assets 0.4% 23 Business-type Activities. Business-type activities increased the City’s net position by $1,854,996. The increase from prior year is mainly due to capital contributions from developers of $1,134,000. The following graph depicts various business-type activities and shows the revenue and expenses directly related to those activities. Expenses and Program - Revenue Business-type Activities Graph $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,100,000 $1,200,000 $1,300,000 $1,400,000 $1,500,000 $1,600,000 $1,700,000 $1,800,000 Water Sewer Storm Water Expenses Revenues Revenue by Source - Business-type Activities Charges for Services 60.0% Grants and Contributions 35.9% Unrestricted Investment Earnings 4.1% 24 Financial Analysis of the Government’s Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental Funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. Increase Major Funds 2019 2018 (Decrease) General 3,126,401$ 3,262,310$ (135,909)$ Debt Service 1,589,730$ 1,457,144$ 132,586$ Sewer Capital Improvements 3,122,661$ 2,868,180$ 254,481$ Fund Balance December 31, The fund balance of the General fund decreased by $135,909 as a result of transfers out of the general fund that were greater than budgeted. The Sewer Capital Improvement fund balance increased $254,481 mainly due to an increase in interest revenue from investments and special assessment revenue received in the current year. The Debt Service fund balance increased $130,747 mainly due to transfers in during the current year. Proprietary Funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. Unrestricted net position of the enterprise funds at the end of the year amounted to $4,985,544. The total increase in net position for the funds was $1,854,996. Other factors concerning the finances of this fund have already been addressed in the discussion of the City’s business-type activities. General Fund Budgetary Highlights The City’s General fund budget was not amended during the year and the budget called for no change in fund balance. Revenues exceeded the budget by $379,739, primarily due to licenses and permits and charges for services exceeding the budget by $148,447 and $104,643, respectively. Expenditures were over budget by $115,648 during the year. The budget variance can be attributed mainly to general government, streets and highways, and capital outlay of $68,969, $24,550, and $18,000, respectively. Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business type activities as of December 31, 2019, amounts to $27,842,523 (net of accumulated depreciation). This investment in capital assets includes land, structures, improvements, machinery and equipment, park facilities, and roads. Major capital asset events during the current fiscal year included the following: • Hickory Drive reconstruction • Brockton Lane reconstruction • New ballfield dugouts • Public works loader 25 Additional information on the City’s capital assets can be found in Note 3B starting on page 59 of this report. City of Medina’s Capital Assets (Net of Depreciation) Increase Increase 2019 2018 (Decrease) 2019 2018 (Decrease) 813,779$ 813,779$ -$ 56,393$ 56,393$ -$ 13,457,735 12,663,785 793,950 5,627,071 4,637,000 990,071 7,503,802 7,749,307 (245,505) 4,793,191 4,984,902 (191,711) 1,963,600 2,029,013 (65,413) 1,139,591 1,214,707 (75,116) 1,132,698 902,000 230,698 950,963 1,019,733 (68,770) Medina Land Infrastructure Buildings Improvements Machinery and Equipment Construction in Progress 1,402,749 931,173 471,576 26,306 2,027 24,279 Total 26,274,363$ 25,089,057$ 1,185,306$ 12,593,515$ 11,914,762$ 678,753$ Governmental Activities Business-type Activities Long-term Debt. At the end of the current fiscal year, the City had total bonded debt outstanding of $13,810,000. City of Medina’s Outstanding Debt Increase Increase 2019 2018 (Decrease) 2019 2018 (Decrease) General Obligation Improvement Bonds 9,705,000$ 10,445,000$ (740,000)$ -$ -$ -$ G.O. Tax Increment Bonds 175,000 255,000 (80,000) - - - General Obligation Revenue Bonds - - - 1,170,000 1,735,000 (565,000) Unamortized Premium on Bonds 129,522 149,793 (20,271) 20,833 36,219 (15,386) Total 10,009,522$ 10,849,793$ (840,271)$ 1,190,833$ 1,771,219$ (580,386)$ Governmental Activities Business-type Activities The City’s total debt decreased $1,420,657 (11.3 percent) during the current fiscal year mainly due to regularly schedule principal payments. Additional information on the City’s long-term debt can be found in Note 3D starting on page 62 of this report. Economic Factors and Next Year’s Budgets and Rates •The unemployment rate for Hennepin County is currently 2.6 percent (Apr 2020). This compares favorably to the State of Minnesota’s average unemployment rate of 3.1 percent and the national average rate of 3.5 percent. •Property valuations increased 4.8 percent within the City from 2019 to 2020. The City’s total property tax levy will increase in 2020 by 9.7 percent. The General fund levy increase amounts to 2.7%, with the remaining increase attributable to the addition of the Municipal Park fund levy and Capital Equipment levy. The City’s tax capacity rate decreased from 21.50% for 2019 to 22.48% for 2020. A water rate increase of 1.5 percent was approved for the three individual water systems for 2020. Sanitary sewer a 2% increase and storm water utility rates also increased 3.0 percent. All of these factors were considered in preparing the City’s budget for the 2020 fiscal year. Requests for Information This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Director, City of Medina, 2052 County Road 24, Medina, MN 55340-9790. 26 GOVERNMENT-WIDE FINANCIAL STATEMENTS CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 27 THIS PAGE IS LEFT BLANK INTENTIONALLY 28 City of Medina, Minnesota Statement of Net Position December 31, 2019 Governmental Business-type Activities Activities Total Assets Cash and temporary investments 15,134,488$ 5,102,769$ 20,237,257$ Receivables Accounts 42,047 133,430 175,477 Taxes 98,601 - 98,601 Special assessments 1,872,475 32,779 1,905,254 Due from other governments 42,814 11,853 54,667 Prepaid items 72,802 34,278 107,080 Capital assets Nondepreciable 2,216,528 82,699 2,299,227 Depreciable, net of accumulated depreciation 24,057,835 12,510,816 36,568,651 Total Assets 43,537,590 17,908,624 61,446,214 Deferred Outflows of Resources Deferred pension resources 1,091,038 19,082 1,110,120 Deferred other postemployment benefits 13,213 1,807 15,020 Total Deferred Outflows of Resources 1,104,251 20,889 1,125,140 Liabilities Accounts payable 213,198 25,936 239,134 Due to other governments 17,367 5,514 22,881 Salaries payable 150,426 6,002 156,428 Accrued interest payable 91,143 8,537 99,680 Deposits payable 1,308,236 - 1,308,236 Unearned revenue 53,764 - 53,764 Noncurrent liabilities Due within one year 1,022,477 582,687 1,605,164 Due in more than one year 9,346,401 665,980 10,012,381 Net pension liability 1,633,495 187,475 1,820,970 Other postemployment benefits liability 108,131 14,966 123,097 Total Liabilities 13,944,638 1,497,097 15,441,735 Deferred Inflows of Resources Deferred pension resources 1,671,955 44,817 1,716,772 Deferred other post employment benefits (4,662) (627) (5,289) Total Deferred Inflows of Resources 1,667,293 44,190 1,711,483 Net Position Net investment in capital assets 16,439,841 11,402,682 27,842,523 Restricted for Debt service 3,021,763 - 3,021,763 Park improvements 1,238,690 - 1,238,690 Police expenditures 204,436 - 204,436 Unrestricted 8,125,180 4,985,544 13,110,724 Total Net Position 29,029,910$ 16,388,226$ 45,418,136$ The notes to the financial statements are an integral part of this statement. 29 City of Medina, Minnesota Statement of Activities For the Year Ended December 31, 2019 Operating Grants Capital Grants Charges for and and Expenses Services Contributions Contributions Governmental Activities General government 1,319,665$ 112,016$ -$ 444$ Public safety 2,755,337 964,375 193,601 150 Streets and highways 1,803,752 12,142 - 2,755,523 Sanitation and recycling 15,311 - 25,238 - Culture and recreation 471,625 166,294 202,111 53,054 Economic development 203,234 - - - Interest on long-term debt 211,132 - - - Total Governmental Activities 6,780,056 1,254,827 420,950 2,809,171 Business-type Activities Water 840,718 1,055,766 194 576,400 Sewer 691,716 799,379 166 614,152 Storm water 194,506 248,831 79 68,750 Total Business-type Activities 1,726,940 2,103,976 439 1,259,302 Total 8,506,996$ 3,358,803$ 421,389$ 4,068,473$ General Revenues Taxes Property taxes, levied for general purposes Property taxes, levied for debt service Tax increments Franchise taxes Grants and contributions not restricted to specific programs Unrestricted investment earnings Gain on sale of capital assets Transfers - Capital Assets Transfers Total General Revenues and Transfers Change in Net Position Net Position - January 1 Net Position, December 31 Functions/Programs Program Revenues The notes to the financial statements are an integral part of this statement. 30 Governmental Business-type Activities Activities Total (1,207,205)$ -$ (1,207,205)$ (1,597,211) - (1,597,211) 963,913 - 963,913 9,927 - 9,927 (50,166) - (50,166) (203,234) - (203,234) (211,132) - (211,132) (2,295,108) - (2,295,108) - 791,642 791,642 - 721,981 721,981 - 123,154 123,154 - 1,636,777 1,636,777 (2,295,108) 1,636,777 (658,331) 3,530,087 - 3,530,087 532,962 - 532,962 491,715 - 491,715 61,648 - 61,648 31,331 - 31,331 431,793 143,725 575,518 35,880 - 35,880 (22,321) 22,321 - (52,173) 52,173 - 5,040,922 218,219 5,259,141 2,745,814 1,854,996 4,600,810 26,284,096 14,533,230 40,817,326 29,029,910$ 16,388,226$ 45,418,136$ Changes in Net Position Net (Expenses) Revenues and The notes to the financial statements are an integral part of this statement. 31 THIS PAGE IS LEFT BLANK INTENTIONALLY 32 FUND FINANCIAL STATEMENTS CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 33 City of Medina, Minnesota Balance Sheet Governmental Funds December 31, 2019 101 403 Other Total Debt Sewer Capital Governmental Governmental General Service Improvements Funds Funds Assets Cash and temporary investments 4,684,924$ 1,580,513$ 3,014,082$ 5,854,969$ 15,134,488$ Receivables Accounts 5,717 - 4,515 31,815 42,047 Taxes 84,313 14,288 - - 98,601 Special assessments 43,885 1,508,888 - 319,702 1,872,475 Due from other governments 30,555 9,217 - 3,042 42,814 Due from other funds - - 117,408 - 117,408 Prepaid items 72,802 - - - 72,802 Total Assets 4,922,196$ 3,112,906$ 3,136,005$ 6,209,528$ 17,380,635$ Liabilities Accounts payable 177,844$ -$ 8,829$ 26,525$ 213,198$ Due to other funds - - - 117,408 117,408 Due to other governments 15,924 - - 1,443 17,367 Salaries payable 150,426 - - - 150,426 Deposits payable 1,308,236 - - - 1,308,236 Unearned revenue 15,167 - 4,515 34,082 53,764 Total Liabilities 1,667,597 - 13,344 179,458 1,860,399 Deferred Inflows of Resources Unavailable revenue - taxes 84,313 14,288 - - 98,601 Unavailable revenue - assessments 43,885 1,508,888 - 319,702 1,872,475 Total Deferred Inflows of Resources 128,198 1,523,176 - 319,702 1,971,076 Fund Balances Nonspendable 72,802 - - - 72,802 Restricted - 1,589,730 - 1,443,126 3,032,856 Committed - - - 1,430,895 1,430,895 Assigned 120,164 - 3,122,661 2,954,345 6,197,170 Unassigned 2,933,435 - - (117,998) 2,815,437 Total Fund Balances 3,126,401 1,589,730 3,122,661 5,710,368 13,549,160 Total Liabilities, Deferred Inflows of Resources and Fund Balances 4,922,196$ 3,112,906$ 3,136,005$ 6,209,528$ 17,380,635$ The notes to the financial statements are an integral part of this statement. 34 City of Medina, Minnesota Reconciliation of the Balance Sheet to the Statement of Net Position Governmental Funds December 31, 2019 Amounts reported for governmental activities in the statement of net position are different because Total Fund Balances - Governmental Funds 13,549,160$ Capital assets used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds. Cost of capital assets 37,243,290 Less accumulated depreciation (10,968,927) Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term liabilities at year-end consist of Bonds payable (9,880,000) Plus premium on bonds (129,522) Compensated absences payable (359,356) Other postemployment benefits payable (108,131) Pension liability (1,633,495) Some receivables are not available soon enough to pay for the current period's expenditures, and therefore are unavailable in the funds. Taxes receivable 98,601 Special assessments receivable 1,872,475 Governmental funds do not report long-term amounts related to pensions and other postemployment benefits. Deferred outflows of pension resources 1,091,038 Deferred inflows of pension resources (1,671,955) Deferred outflows of other postemployment benefits resources 4,662 Deferred inflows of other postemployment benefits resources 13,213 Governmental funds do not report a liability for accrued interest until due and payable.(91,143) Total Net Position - Governmental Activities 29,029,910$ The notes to the financial statements are an integral part of this statement. 35 City of Medina, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2019 101 403 Other Total Debt Sewer Capital Governmental Governmental General Service Improvements Funds Funds Revenues Taxes 3,367,192$ 532,962$ -$ 702,593$ 4,602,747$ Licenses and permits 418,547 - - - 418,547 Intergovernmental 295,467 - - 44,200 339,667 Charges for services 335,089 - 87,290 600,515 1,022,894 Fines and forfeitures 98,187 - - 122,418 220,605 Special assessments 444 291,365 100,000 284,244 676,053 Interest on investments 116,324 26,259 89,513 199,697 431,793 Miscellaneous 107,254 - - 710,526 817,780 Total Revenues 4,738,504 850,586 276,803 2,664,193 8,530,086 Expenditures Current General government 1,249,250 - - - 1,249,250 Public safety 2,426,319 - - 9,475 2,435,794 Streets and highways 752,427 - - - 752,427 Sanitation and recycling 15,033 - - - 15,033 Culture and recreation 222,957 - - 80,552 303,509 Capital outlay General government - - - 13,716 13,716 Public safety - - - 320,274 320,274 Streets and highways - - 22,322 905,745 928,067 Culture and recreation 18,000 - - 63,631 81,631 Economic development - - - 190,872 190,872 Debt service Principal - 820,000 - - 820,000 Interest and other charges - 238,347 - - 238,347 Total Expenditures 4,683,986 1,058,347 22,322 1,584,265 7,348,920 Excess (Deficiency) of Revenues Over (Under) Expenditures 54,518 (207,761) 254,481 1,079,928 1,181,166 Other Financing Sources (Uses) Proceeds from sale of capital assets - - - 35,880 35,880 Transfers in 213,573 340,347 - 404,000 957,920 Transfers out (404,000) - - (606,093) (1,010,093) Total Other Financing Sources (Uses)(190,427) 340,347 - (166,213) (16,293) Net Change in Fund Balances (135,909) 132,586 254,481 913,715 1,164,873 Fund Balances, January 1 3,262,310 1,457,144 2,868,180 4,796,653 12,384,287 Fund Balances, December 31 3,126,401$ 1,589,730$ 3,122,661$ 5,710,368$ 13,549,160$ The notes to the financial statements are an integral part of this statement. 36 City of Medina, Minnesota Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the Year Ended December 31, 2019 Amounts reported for governmental activities in the statement of activities are different because Total Net Change in Fund Balances - Governmental Funds 1,164,873$ Capital outlays are reported in governmental funds as expenditures. However, in the statement of activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense. Capital outlay 1,086,147 Depreciation expense (1,243,350) A gain or loss on the disposal of capital assets, including the difference between carrying value and any related sales proceeds, is included in net position. However, only the sales proceeds are included in the change in the change in fund balance.(54,171) Capital assets constructed in capital projects funds but intended for enterprise fund use are transferred in the government-wide financial statements.(22,321) Donations of capital assets increase net position in the statement of activities, but do not appear in the governmental funds because they are not financial resources.1,419,000 The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts are amortized in the statement of activities. Amortization of bond premium 20,271 Principal repayments 820,000 Interest on long-term debt in the statement of activities differs from the amount reported in the governmental funds because interest is recognized as an expenditure in the funds when it is due, and thus requires the use of current financial resources. In the statement of activities, however, interest expense is recognized as the interest accrues, regardless of when it is due.6,944 Certain revenues are recognized as soon as they are earned. Under the modified accrual basis of accounting certain revenues cannot be recognized until they are available to liquidate liabilities of the current period. Property taxes 13,665 Special assessments (411,313) Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Other postemployment benefits costs (78) Compensated absences (23,573) Long-term pension activity is not reported in governmental funds. Pension expense (43,326) Pension revenue 13,046 Change in Net Position - Governmental Activities 2,745,814$ The notes to the financial statements are an integral part of this statement. 37 THIS PAGE IS LEFT BLANK INTENTIONALLY 38 City of Medina, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended December 31, 2019 Actual Variance with Original Final Amounts Final Budget Revenues Taxes 3,358,897$ 3,358,897$ 3,367,192$ 8,295$ Licenses and permits 270,100 270,100 418,547 148,447 Intergovernmental 263,910 263,910 295,467 31,557 Charges for services 230,446 230,446 335,089 104,643 Fines and forfeitures 110,000 110,000 98,187 (11,813) Special assessments 1,715 1,715 444 (1,271) Interest on investments 20,000 20,000 116,324 96,324 Miscellaneous 103,697 103,697 107,254 3,557 Total Revenues 4,358,765 4,358,765 4,738,504 379,739 Expenditures Current General government 1,180,281 1,180,281 1,249,250 (68,969) Public safety Police 1,663,425 1,663,425 1,661,551 1,874 Building inspection 318,343 318,343 339,171 (20,828) Fire 446,242 446,242 425,597 20,645 Streets and highways 727,877 727,877 752,427 (24,550) Sanitation and recycling 20,080 20,080 15,033 5,047 Culture and recreation 212,090 212,090 222,957 (10,867) Capital outlay - - 18,000 (18,000) Total Expenditures 4,568,338 4,568,338 4,683,986 (115,648) Excess (Deficiency) of Revenues Over (Under) Expenditures (209,573) (209,573) 54,518 264,091 Other Financing Sources (Uses) Transfers in 213,573 213,573 213,573 - Transfers out (4,000) (4,000) (404,000) (400,000) Total Other Financing Sources (Uses)209,573 209,573 (190,427) (400,000) Net Change in Fund Balances - - (135,909) (135,909) Fund Balances, January 1 3,262,310 3,262,310 3,262,310 - Fund Balances, December 31 3,262,310$ 3,262,310$ 3,126,401$ (135,909)$ Budgeted Amounts The notes to the financial statements are an integral part of this statement. 39 City of Medina, Minnesota Statement of Net Position Proprietary Funds December 31, 2019 Nonmajor 601 602 603 Water Sewer Storm Water Totals Assets Current Assets Cash and temporary investments 2,793,160$ 1,812,088$ 497,521$ 5,102,769$ Receivables Accounts 51,014 75,536 6,880 133,430 Special assessments 14,804 14,804 3,171 32,779 Due from other governments 7,632 3,871 350 11,853 Prepaid items 1,874 32,066 338 34,278 Total Current Assets 2,868,484 1,938,365 508,260 5,315,109 Noncurrent Assets Capital assets Land 7,393 49,000 - 56,393 Infrastructure 6,111,534 2,756,462 47,811 8,915,807 Buildings 8,216,454 192,000 - 8,408,454 Improvements 330,082 - 1,087,315 1,417,397 Machinery and equipment 1,164,212 2,921,472 44,174 4,129,858 Construction in progress - 22,374 3,932 26,306 Less accumulated depreciation (6,833,352) (3,232,426) (294,922) (10,360,700) Total Noncurrent Assets 8,996,323 2,708,882 888,310 12,593,515 Total Assets 11,864,807 4,647,247 1,396,570 17,908,624 Deferred Outflows of Resources Deferred pension resources 8,441 7,209 3,432 19,082 Deferred other postemployment benefits 821 661 325 1,807 Total Deferred Outflows of Resources 9,262 7,870 3,757 20,889 Business-type Activities - Enterprise funds The notes to the financial statements are an integral part of this statement. 40 City of Medina, Minnesota Statement of Net Position (Continued) Proprietary Funds December 31, 2019 601 602 603 Water Sewer Storm Water Totals Liabilities Current Liabilities Accounts payable 21,911$ 3,381$ 644$ 25,936$ Accrued interest payable 8,537 - - 8,537 Salaries payable 2,636 2,393 973 6,002 Due to other governments 4,576 938 - 5,514 Compensated absences payable - current 5,428 4,946 2,313 12,687 Bonds payable - current 570,000 - - 570,000 Total Current Liabilities 613,088 11,658 3,930 628,676 Noncurrent Liabilities Other postemployment benefits payable 6,940 5,321 2,705 14,966 Compensated absences payable 18,662 17,621 8,864 45,147 Pension liability 82,931 70,823 33,721 187,475 Bonds payable 620,833 - - 620,833 Total Noncurrent Liabilities 729,366 93,765 45,290 868,421 Total Liabilities 1,342,454 105,423 49,220 1,497,097 Deferred Inflows of Resources Deferred pension resources 19,825 16,931 8,061 44,817 Deferred other post employment benefits (276) (239) (112) (627) Total Deferred Inflows of Resources 19,549 16,692 7,949 44,190 Net Position Net investment in capital assets 7,805,490 2,708,882 888,310 11,402,682 Unrestricted 2,706,576 1,824,120 454,848 4,985,544 Total Net Position 10,512,066$ 4,533,002$ 1,343,158$ 16,388,226$ Business-type Activities - Enterprise funds The notes to the financial statements are an integral part of this statement. 41 THIS PAGE IS LEFT BLANK INTENTIONALLY 42 City of Medina, Minnesota Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds For the Year Ended December 31, 2019 Nonmajor 601 602 603 Water Sewer Storm Water Totals Operating Revenues Charges for services 1,055,766$ 799,379$ 248,831$ 2,103,976$ Operating Expenses Wages and salaries 159,929 144,097 70,154 374,180 Materials and supplies 91,394 8,576 1,561 101,531 Professional services 44,803 34,544 46,165 125,512 Repairs and maintenance 103,365 13,882 15,015 132,262 Insurance 7,178 5,343 437 12,958 Utilities 91,023 7,447 - 98,470 Depreciation 335,758 86,271 61,174 483,203 Sewer treatment charges - 391,556 - 391,556 Total Operating Expenses 833,450 691,716 194,506 1,719,672 Operating Income 222,316 107,663 54,325 384,304 Nonoperating Revenues (Expenses) Interest on investments 72,205 55,669 15,851 143,725 Miscellaneous income 194 166 79 439 Interest and service charges (7,268) - - (7,268) Total Nonoperating Revenues (Expenses)65,131 55,835 15,930 136,896 Income Before Contributions and Transfers 287,447 163,498 70,255 521,200 Capital Contributions from Other Funds - 22,321 - 22,321 Capital Contributions 576,400 614,152 68,750 1,259,302 Transfers In 360,093 - - 360,093 Transfers Out (122,149) (127,582) (58,189) (307,920) Change in Net Position 1,101,791 672,389 80,816 1,854,996 Net Position - January 1 9,410,275 3,860,613 1,262,342 14,533,230 Net Position, December 31 10,512,066$ 4,533,002$ 1,343,158$ 16,388,226$ Business-type Activities - Enterprise funds The notes to the financial statements are an integral part of this statement. 43 City of Medina, Minnesota Statement of Cash Flows Proprietary Funds For the Year Ended December 31, 2019 Nonmajor 601 602 603 Water Sewer Storm Water Totals Cash Flows from Operating Activities Receipts from customers and users 1,040,460$ 792,470$ 245,849$ 2,078,779$ Payments to suppliers (325,431) (460,348) (69,971) (855,750) Payments to employees (170,148) (146,122) (71,255) (387,525) Net Cash Provided (Used) by Operating Activities 544,881 186,000 104,623 835,504 Cash Flows from Noncapital Financing Activities Transfers from other funds 360,093 - - 360,093 Transfers to other funds (122,149) (127,582) (58,189) (307,920) Net Cash Provided (Used) by Noncapital Financing Activities 237,944 (127,582) (58,189) 52,173 Cash Flows from Capital and Related Financing Activities Acquisition of capital assets - (7,976) (1,905) (9,881) Connection fees 9,400 - - 9,400 Intergovernmental - 47,152 68,750 115,902 Principal paid on bonds (565,000) - - (565,000) Interest paid on bonds (26,581) - - (26,581) Net Cash Provided (Used) by Capital and Related Financing Activities (582,181) 39,176 66,845 (476,160) Cash Flows from Investing Activities Interest received on investments 72,207 55,670 15,851 143,728 Net Increase in Cash and Cash Equivalents 272,851 153,264 129,130 555,245 Cash and Cash Equivalents, January 1 2,520,309 1,658,824 368,391 4,547,524 Cash and Cash Equivalents, December 31 2,793,160$ 1,812,088$ 497,521$ 5,102,769$ Business-type Activities - Enterprise funds The notes to the financial statements are an integral part of this statement. 44 City of Medina, Minnesota Statement of Cash Flows (Continued) Proprietary Funds For the Year Ended December 31, 2019 Nonmajor 601 602 603 Water Sewer Storm Water Totals Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities Operating income 222,316$ 107,663$ 54,325$ 384,304$ Adjustments to reconcile operating income to net cash provided by operating activities Other items related to operations 194 166 79 439 Depreciation 335,758 86,271 61,174 483,203 (Increase) decrease in assets and deferred outflows Accounts receivable (10,426) (3,449) (2,856) (16,731) Due from other governments (5,319) (3,871) (285) (9,475) Special assessments receivable 245 245 80 570 Prepaid items (452) 1,165 - 713 Pension resources 10,836 8,424 4,041 23,301 Other postemployment benefits (821) (661) (325) (1,807) Increase (decrease) in liabilities and deferred inflows Accounts payable 10,471 (442) (6,468) 3,561 Due to other governments 3,134 938 - 4,072 Salaries payable (15) 234 (31) 188 Compensated absences payable (5,021) (2,105) (860) (7,986) Pension liability (11,654) (5,885) (2,941) (20,480) Pension resources (5,191) (3,358) (1,636) (10,185) Other postemployment benefits payable 826 665 326 1,817 Net Cash Provided (Used) by Operating Activities 544,881$ 186,000$ 104,623$ 835,504$ Schedule of Noncash Capital Financing Activities Contribution of assets from developers 567,000$ 567,000$ -$ 1,134,000$ Contribution of assets from other funds -$ 22,321$ -$ 22,321$ Amortization of bond premium 15,386$ -$ -$ 15,386$ Business-type Activities - Enterprise funds The notes to the financial statements are an integral part of this statement. 45 THIS PAGE IS LEFT BLANK INTENTIONALLY 46 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies A. Reporting Entity The City of Medina, Minnesota (the City) operates under the “Optional Plan A” form of government as defined in the State of Minnesota statutes. Under this plan, the government of the City is directed by a City Council composed of an elected Mayor and four elected City Council Members. The City Council exercises legislative authority and determines all matters of policy. The City Council appoints personnel responsible for the proper administration of all affairs relating to the City. The City has considered all potential units for which it is financially accountable and other organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City’s financial statements to be misleading or incomplete. The Governmental Accounting Standards Board (GASB) has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization’s governing body, and (1) the ability of the primary government to impose its will on that organization or (2) the potential for the organization to provide specific benefits to, or impose specific financial burdens on the City. Blended component units, although legally separate entities are, in substance, part of the City’s operations and so data from these units are combined with data of the City. The City has the following component unit: Blended Component Unit. The Medina Economic Development Authority (MEDA) of the City was created pursuant to Minnesota statutes 469.090 through 469.108 to carry out economic and industrial development and redevelopment consistent with policies established by the City Council. It is comprised of five members, all of which are City Council members, and has a December 31 year end. The EDA activities are blended and reported in a Capital Project fund (Tax Increment 1-9) due to substantively the same governing board and the financial benefit/burden relationship. Separate financial statements are not issued for this component unit. B. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the City. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Amounts reported as program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. 47 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) C. Measurement Focus, Basis of Accounting and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the City. Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenue is recorded in the year in which the resources are measurable and become available. Non-exchange transactions, in which the City receives value without directly giving equal value in return, include property taxes, grants, entitlement and donations. On an accrual basis, revenue from property taxes is recognized in the year for which the tax is levied. Revenue from grants, entitlements and donations is recognized in the year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the year when use is first permitted, matching requirements, in which the City must provide local resources to be used for a specified purpose, and expenditure requirements, in which the resources are provided to the City on a reimbursement basis. On a modified accrual basis, revenue from non-exchange transactions must also be available before it can be recognized. Unearned revenue arises when assets are recognized before revenue recognition criteria have been satisfied. Grants and entitlements received before eligibility requirements are met are also recorded as unearned revenue. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 48 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major governmental funds: The General fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Debt Service fund accounts for the resources accumulated and payments made for principal and interest on long- term general obligation debt of governmental funds. The Sewer Capital Improvements fund accounts for the costs associated with replacement of the City’s utility and road systems. The City reports the following major proprietary funds: The Water fund accounts for the activities of the City’s water distribution system, which are financed by the water utility fee, and insure that user charges are sufficient to pay for those costs. The Sewer fund accounts for the activities of the City’s wastewater collection operations which are financed by the sanitary sewer utility fee, and insure that user charges are sufficient to pay for those costs. As a general rule, the effect of interfund activity has been eliminated from government-wide financial statements. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the City enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. 49 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position/Fund Balance Deposits and Investments The City’s cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. The proprietary funds’ portion in the government-wide cash and temporary investments pool is considered to be cash and cash equivalents for purposes of the statement of cash flows. Cash balances from all funds are pooled and invested, to the extent available, in certificates of deposit and other authorized investments. Earnings from such investments are allocated on the basis of applicable participation by each of the funds. The City may also invest idle funds as authorized by Minnesota statutes, as follows: 1. Direct obligations or obligations guaranteed by the United States or its agencies. 2. Shares of investment companies registered under the Federal Investment Company Act of 1940 and received the highest credit rating, rated in one of the two highest rating categories by a statistical rating agency, and have a final maturity of thirteen months or less. 3. General obligations of a state or local government with taxing powers rated “A” or better; revenue obligations rated “AA” or better. 4. General obligations of the Minnesota Housing Finance Agency rated “A” or better. 5. Obligation of a school district with an original maturity not exceeding 13 months and (i) rated in the highest category by a national bond rating service or (ii) enrolled in the credit enhancement program pursuant to statute section 126C.55. 6. Bankers’ acceptances of United States banks eligible for purchase by the Federal Reserve System. 7. Commercial paper issued by United States banks corporations or their Canadian subsidiaries, of highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less. 8. Repurchase or reverse repurchase agreements and securities lending agreements with financial institutions qualified as a “depository” by the government entity, with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000, a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York, or certain Minnesota securities broker-dealers. 9. Guaranteed Investment Contracts (GIC’s) issued or guaranteed by a United States commercial bank, a domestic branch of a foreign bank, a United States insurance company, or its Canadian subsidiary, whose similar debt obligations were rated in one of the top two rating categories by a nationally recognized rating agency. Broker money market funds operate in accordance with appropriate state laws and regulations. The reported value of the pool is the same as the fair value of the shares. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. 50 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) The City has the following recurring fair value measurements as of December 31, 2019: • U.S. Government Agency securities of $1,189,200 are valued using quoted market prices (Level 1 inputs) • Negotiable certificates of deposit of $10,939,119 are values using a matrix pricing model (Level 2 inputs) The Minnesota Municipal Money Market Fund is regulated by Minnesota statutes and the Board of Directors of the League of Minnesota Cities and is an external investment pool not registered with the Securities Exchange Commission (SEC) that follows the regulatory rules of the SEC. In accordance with GASB Statement No. 79, the City’s investment in this pool is valued at amortized cost, which approximates fair value. There are no restrictions or limitations on withdrawals from the 4M Liquid Asset Fund. Investments in the 4M Plus must be deposited for a minimum of 14 calendar days. Withdrawals prior to the 14-day restriction period will be subject to a penalty equal to seven days interest on the amount withdrawn. Seven days' notice of redemption is required for withdrawals of investments in the 4M Term Series withdrawn prior to the maturity date of that series. A penalty could be assessed as necessary to recoup the Series for any charges, losses, and other costs attributable to the early redemption. Financial statements of the 4M Fund can be obtained by contracting RBC Global Management at 100 South Fifth Street, Suite 2300, Minneapolis, MN 55402-1240. At December 31, 2019, the City had no investments in one issuer (other than investments issued by or explicitly guaranteed by U.S. government, mutual funds, external investment pools, and other pooled investments) that represent 5 percent or more of the City’s investments. The investment in the Minnesota Municipal Money Market Mutual Fund is not subject to the custodial credit risk classifications as noted in paragraph 9 of GASB Statement No. 40. Property Taxes The City Council annually adopts a tax levy and certifies it to the County in December for collection the following year. The County is responsible for collecting all property taxes for the City. These taxes attach an enforceable lien on taxable property within the City on January 1 and are payable by the property owners in two installments. The taxes are collected by the County Treasurer and tax settlements are made to the City during January, July and December each year. Delinquent taxes receivable include the past six years’ uncollected taxes. Delinquent taxes have been offset by a deferred inflow of resources for delinquent taxes not received within 60 days after year end in the fund financial statements. Accounts Receivable Accounts receivable include amounts billed for services provided before year end. Unbilled utility enterprise fund receivables are also included for services provided in 2019. The City annually certifies delinquent water, sewer and storm water accounts to the County for collection in the following year. As a result, there has been no allowance for doubtful accounts established for the enterprise funds. Special Assessments Special assessments represent the financing for public improvements paid for by benefiting property owners. Assessments were also completed for unreimbursed costs and uncollected City charges for services. These assessments are recorded as receivables upon certification to the County. Special assessments are recognized as revenue when they are certified to the County or received in cash or within 60 days after year end. All governmental special assessments receivable are offset by a deferred inflow of resources in the fund financial statements. 51 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) Interfund Receivables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as “due to/from other funds.” Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.” Prepaid Items Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. Capital Assets Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items) are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of three years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. The City reports infrastructure assets on a network and subsystem basis. Accordingly, the amounts spent for the construction or acquisition on infrastructure assets are capitalized and reported in the government-wide financial statements. In the case of the initial capitalization of general infrastructure assets (i.e., those reported by governmental activities) the City chose to include all assets accounted for prospectively from the phase 3 GASB 34 implementation date. As the City constructs or acquires additional capital assets each period, including infrastructure assets, they are capitalized and reported at historical cost. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. The reported value excludes normal maintenance and repairs which are essentially amounts spent in relation to capital assets that do not increase the capacity or efficiency of the item or extend its useful life beyond the original estimate. Donated capital assets are recorded at acquisition value at the time of donation. Property, plant and equipment of the City are depreciated using the straight-line method over the following estimated useful lives: Useful Lives Assets in Years Buildings 20 to 40 Land Improvements 20 Building Improvements 20 Furniture and Equipment 5 to 10 Light Vehicles 3 to 5 Machinery and Equipment 5 to 10 Heavy Trucks 7 to 10 Infrastructure 25 to 40 52 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) Deferred Outflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has two items which qualify for reporting in this category. Accordingly, the items, deferred pension resources and deferred other postemployment benefit resources, are reported only in the statement of net position. These items result from actuarial calculations and current year pension contributions and OPEB contributions made subsequent to the measurement dates. Compensated Absences The City compensates employees who resign or retire in good standing for all unused vacation. Sick leave may be accumulated and banked to a maximum of 960 hours for full-time and regular part-time employees. For sick leave accumulated is excess of 960 hours, the employee may bank the hours in an account established by the City for retirement health insurance premiums. An employee who leaves employment voluntarily, with four of more years of service with the City and gives a 14 calendar day notice of termination of employment will be paid at the base rate of pay, one-third of accumulated sick leave hours. Any sick leave banked in excess of 960 hours will be forfeited. Two options are available in regards to accrued sick leave for an employee who voluntarily leaves after 20 or more years of service with the City. After giving at least a 14 day notice of termination of employment an employee may receive payment for one-half of all accrued sick leave at the employee’s base rate of pay at the time of termination including sick leave banked in excess of 960 hours. A second option allows the employee to give the City at least 14 days’ notice of termination of employment; which then allows the employee to place any accrued sick leave into the retirement health insurance account including sick leave banked in excess of 960 hours converted to a monetary value by using the employees base rate of pay for that year. Compensation time is also paid out upon termination. All hourly employees can earn compensation time for every hour of overtime they work. Each hour of overtime is accrued into 1.5 hours of compensation time. Also, a police employee who works any of the 11 holidays can accrue at a rate of 1.5 compensation hours per hour worked and be paid out for accruals over 80 hours. Vacation, sick, and compensation time pay are considered expenditures in the year paid in the governmental fund statements. This differs from the proprietary and government-wide statements where vacation, sick, and compensation pay are expensed when earned. The General fund is typically used to liquidate governmental compensated absences. Postemployment Benefits Other Than Pensions Under Minnesota statute 471.61, subdivision 2b., public employers must allow retirees and their dependents to continue coverage indefinitely in an employer-sponsored health care plan, under the following conditions: 1) Retirees must be receiving (or eligible to receive) an annuity from a Minnesota public pension plan, 2) Coverage must continue in group plan until age 65, and retirees must pay no more than the group premium, and 3) Retirees may obtain dependent coverage immediately before retirement. All premiums are funded on a pay-as-you-go basis. The liability was actuarially determined, in accordance with GASB Statement 75, at January 1, 2019. The General fund is typically used to liquidate the governmental liability. Long-term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Recognition of bond premiums and discounts are delayed and amortized over the life of the bonds using the straight line method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as an expense in the period incurred. 53 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) In the fund financial statements, governmental fund types recognized bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. Pensions For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension expense, information about the fiduciary net position of the Public Employees Retirement Association (PERA) and additions to/deductions from PERA’s fiduciary net position have been determined on the same basis as they are reported by PERA except that PERA’s fiscal year end is June 30. For this purpose, plan contributions are recognized as of employer payroll paid dates and benefit payments and refunds are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. The General fund is typically used to liquidate the governmental net pension liability. General Employees Fund 122,762$ Police and Fire Fund 171,381 Total 294,143$ Deferred Inflows of Resources In addition to liabilities, the statement of net position and fund financial statements will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from two sources: delinquent taxes and special assessments. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. Furthermore, the City has additional items which qualify for reporting in this category on the statement of net position. The items, deferred pension resources and deferred other postemployment benefit resources, are reported only in the statement of net position and results from actuarial calculations involving net differences between projected and actual earnings on plan investments and changes in proportions. Net Position Net position represents the difference between assets and deferred outflows of resources and liabilities and deferred inflows of resources. Net position is displayed in three components: a. Net investment in capital assets - Consists of capital assets, net of accumulated depreciation reduced by any outstanding debt attributable to acquire capital assets. b. Restricted net position - Consists of net position balances restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, laws or regulations of other governments. c. Unrestricted net position - All other net position that do not meet the definition of “restricted” or “net investment in capital assets”. When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed. 54 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 1: Summary of Significant Accounting Policies (Continued) Fund Balance In the fund financial statements, fund balance is divided into five classifications based primarily on the extent to which the City is bound to observe constraints imposed upon the use of resources reported in the governmental funds. These classifications are defined as follows: Nonspendable - Amounts that cannot be spent because they are not in spendable form, such as prepaid items. Restricted - Amounts related to externally imposed constraints established by creditors, grantors or contributors; or constraints imposed by state statutory provisions. Committed - Amounts constrained for specific purposes that are internally imposed by formal action (resolution) of the City Council, which is the City’s highest level of decision-making authority. Committed amounts cannot be used for any other purpose unless the City Council modifies or rescinds the commitment by resolution. Assigned - Amounts constrained for specific purposes that are internally imposed. In governmental funds other than the General fund, assigned fund balance represents all remaining amounts that are not classified as nonspendable and are neither restricted nor committed. In the General fund, assigned amounts represent intended uses established by the City Council itself or by an official to which the governing body delegates the authority. The City Council has adopted a fund balance policy which delegates the authority to assign amounts for specific purposes to the City Administrator. Unassigned - The residual classification for the General fund and also negative residual amounts in other funds. The City considers restricted amounts to be spent first when both restricted and unrestricted fund balance is available. Additionally, the City would first use committed, then assigned, and lastly unassigned amounts of unrestricted fund balance when expenditures are made. The City has formally adopted a fund balance policy for the General fund. The City’s policy is to maintain an unrestricted fund balance in the General fund of the greater of (1) 50 percent of the next year’s General fund property tax levy, or (2) a minimum of five months of the next year’s budgeted expenditures of the General fund. Note 2: Stewardship, Compliance and Accountability A. Budgetary Information Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America for the General and all special revenue funds. All annual appropriations lapse at fiscal year-end. The City does not use encumbrance accounting. In July of each year, all departments of the City submit requests for appropriations to the City Administrator so that a budget may be prepared. Before September 30th, the proposed budget is presented to the City Council for review. The City Council holds public hearings and a final budget is prepared and adopted in December. The appropriated budget is prepared by fund, function and department. The City’s department heads, with the approval of the City Administrator, may make transfers of appropriations within a department. Transfers of appropriations between departments require the approval of the City Council. The legal level of budgetary control is the department level. Budgeted amounts are as originally adopted, or as amended by the City Council. There were no budget amendments during the year. 55 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 2: Stewardship, Compliance and Accountability (Continued) B. Excess of Expenditures Over Appropriations For the year ended December 31, 2019, expenditures exceeded appropriations in the following fund: Excess of Expenditures Over Fund Budget Actual Appropriations General 4,568,338$ 4,683,986$ 115,648$ The excess expenditures were funded with greater than anticipated revenues. C. Deficit Fund Equity The following funds had deficit fund balances at December 31, 2019: Amount Nonmajor Tax increment 1-9 117,998$ Fund The City plans to fund these deficits with future revenues including tax increments and other revenues. Note 3: Detailed Notes on All Funds A. Deposits and Investments Deposits Custodial credit risk for deposits and investments is the risk that in the event of a bank failure, the City’s deposits and investments may not be returned or the City will not be able to recover collateral securities in the possession of an outside party. In accordance with Minnesota statutes and as authorized by the City Council, the City maintains deposits at those depository banks, all of which are members of the Federal Reserve System. Minnesota statutes require that all City deposits be protected by insurance, surety bond or collateral. The fair value of collateral pledged must equal 110 percent of the deposits not covered by insurance or bonds, with the exception of irrevocable standby letters of credit issued by Federal Home Loan Banks as this type of collateral only requires collateral pledged equal to 100 percent of the deposits not covered by insurance or bonds. 56 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) Authorized collateral in lieu of a corporate surety bond includes: • United States government Treasury bills, Treasury notes, Treasury bonds; • Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; • General obligation securities of any state or local government with taxing powers which is rated “A” or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated “AA” or better by a national bond rating service; • General obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity; • Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence that the bank’s public debt is rated “AA” or better by Moody’s Investors Service, Inc., or Standard & Poor’s Corporation; and • Time deposits that are fully insured by any federal agency. Minnesota statutes require that all collateral shall be placed in safekeeping in a restricted account at a Federal Reserve Bank, or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. The selection should be approved by the government entity. As of December 31, 2019 the City’s carrying amount of deposits was $680,824 and the bank balance was $748,171. Of the bank balance $250,000 was covered by federal depository insurance and the remaining amount was covered by collateral held by the City’s agent in the City’s name. Investments As of December 31, 2019, the City had the following investments that are insured or registered, or securities held by the City or its agent in the City’s name. Credit Segmented Quality/Time Ratings (1) Distribution (2)Amount Level 1 Level 2 Level 3 Pooled Investments Broker money market N/A less than 6 months 1,227,407$ -$ -$ -$ 4M Money Market Fund N/A less than 6 months 5,026,876 - - - Mutual Fund N/A less than 6 months 1,173,531 - - - Non-pooled Investments U.S. Government Agencies AAA 5 year to 10 years 1,189,200 1,189,200 - - Brokered Certificates of Deposit N/A less than 1 year 2,727,715 - 2,727,715 - Brokered Certificates of Deposit N/A 1 year to 5 years 7,717,463 - 7,717,463 - Brokered Certificates of Deposit N/A 5 year to 10 years 493,941 - 493,941 - Total Investments 19,556,133$ 1,189,200$ 10,939,119$ -$ Investment Type Fair Value Measurement Using (1) Ratings were provided by various rating agencies where applicable to indicate associated credit risk. (2) Interest rate risk disclosed using the segmented time distribution method. N/A Indicates not applicable or available. 57 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) The investments of the City are subject to the following risk: • Credit Risk: This is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. State law limits investments in commercial paper and corporate bonds to be in the top two ratings issued by nationally recognized statistical rating organizations. The City’s investment policy states the instruments that the City will invest in will be consistent with the GFOA Policy Statement on the State and Local Laws Concerning Investment Practices and Minnesota statutes 118A. It also states investments in derivatives shall not be allowed. • Custodial Credit Risk - Deposits: For deposits, this is the risk that in the event of bank failure the City’s deposits may not be returned to it. The City has a policy in place to address custodial credit risk for deposits, stating all demand deposit accounts, including checking accounts and nonnegotiable certificates of deposit, in accordance with the GFOA Recommended Practices on the Collateralization of Public Deposits and Minnesota statutes 118A will be required to be fully collateralized. • Interest Rate Risk: This is the risk that market values of securities in a portfolio would decrease due to changes in market interest rates. The City’s investment policy states the City will minimize interest rate rise by structuring the portfolio so that securities mature to meet cash requirements for ongoing operations and investing operating funds primarily in shorter term securities, money market mutual funds or similar investment pools and limiting the average maturity of the portfolio. The policy states the City will not directly invest in securities maturing more than 10 years from the date of purchase or in accordance with the state and local statutes and ordinances unless matched to a specific cash flow. The policy also states the investments will be diversified by investing in securities with varying maturities, continuously investing at least 10 percent of the portfolio in readily available funds such as LGIPs, money market funds to ensure that appropriate liquidity is maintained and never investing more than 20 percent of the portfolio in securities with final maturities greater than five years. • Concentration of Credit Risk: This is the risk of loss attributed to the magnitude of an investment in a single issuer. The City’s investment policy states the City will limit investments to avoid over concentration in securities from a specific issuer or business sector, excluding U.S. Treasury securities and limiting investments in securities that have higher credit risks and investing in securities with varying maturities. The policy also states the City will diversify the investment portfolio so the impact of potential losses from any one type of security or from any one individual issuer will be minimized. Cash Summary A reconciliation of cash as shown on the statement of net position for the City follows: Carrying Amount of Deposits 680,824$ Investments 19,556,133 Cash on Hand 300 Total 20,237,257$ Cash and temporary investments Government-wide 20,237,257$ 58 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) B. Capital Assets Capital asset activity for the year ended December 31, 2019 was as follows: Beginning Ending Balance Increases Decreases Balance Governmental Activities Capital Assets not Being Depreciated Land 813,779$ -$ -$ 813,779$ Construction in progress 931,173 492,566 (20,990) 1,402,749 Total Capital Assets, not Being Depreciated 1,744,952 492,566 (20,990) 2,216,528 Capital Assets Being Depreciated Infrastructure 18,361,023 1,419,000 - 19,780,023 Buildings 9,500,690 - - 9,500,690 Improvements 2,739,006 84,621 - 2,823,627 Machinery and equipment 2,590,688 507,629 (175,895) 2,922,422 Total Capital Assets Being Depreciated 33,191,407 2,011,250 (175,895) 35,026,762 Less Accumulated Depreciation for Infrastructure (5,697,238) (625,050) - (6,322,288) Buildings (1,751,383) (245,505) - (1,996,888) Improvements (709,993) (150,034) - (860,027) Machinery and equipment (1,688,688) (222,761) 121,725 (1,789,724) Total Accumulated Depreciation (9,847,302) (1,243,350) 121,725 (10,968,927) Total Capital Assets, Being Depreciated, Net 23,344,105 767,900 (54,170) 24,057,835 Governmental Activities Capital Assets, Net 25,089,057$ 1,260,466$ (75,160)$ 26,274,363$ Depreciation expense was charged to functions/programs of the governmental activities as follows: Governmental Activities General government 27,174$ Public safety 74,570 Streets and highways 964,745 Culture and recreation 164,499 Economic development 12,362 Total Depreciation Expense - Governmental Activities 1,243,350$ 59 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) Beginning Ending Balance Increases Decreases Balance Business-type Activities Capital Assets not Being Depreciated Land 56,393$ -$ -$ 56,393$ Construction in progress 2,027 24,279 - 26,306 Total Capital Assets not Being Depreciated 58,420 24,279 - 82,699 Capital Assets Being Depreciated Infrastructure 7,773,884 1,141,923 - 8,915,807 Buildings 8,408,454 - - 8,408,454 Improvements 1,421,643 - (4,246) 1,417,397 Machinery and equipment 4,129,858 - - 4,129,858 Total Capital Assets Being Depreciated 21,733,839 1,141,923 (4,246) 22,871,516 Less Accumulated Depreciation for Infrastructure (3,136,884) (151,852) - (3,288,736) Buildings (3,423,552) (191,711) - (3,615,263) Improvements (206,936) (70,870) - (277,806) Machinery and equipment (3,110,125) (68,770) - (3,178,895) Total Accumulated Depreciation (9,877,497) (483,203) - (10,360,700) Total Capital Assets Being Depreciated, Net 11,856,342 658,720 (4,246) 12,510,816 Business-type Activities Capital Assets, Net 11,914,762$ 682,999$ (4,246)$ 12,593,515$ Depreciation expense was charged to functions/programs of the business-type activities as follows: Business-type Activities Water 335,758$ Sewer 86,271 Storm Water 61,174 Total Depreciation Expense - Business-type Activities 483,203$ 60 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) C. Interfund Receivables, Payables and Transfers Interfund Balances The composition of interfund balances at December 31, 2019 is as follows: Purpose Amount Sewer Capital Improvements Fund Nonmajor governmental Cash flow purposes 117,408$ Payable FundReceivable Fund Interfund Transfers The composition of interfund transfers for the year ended December 31, 2019 is as follows: Debt Nonmajor General Service Governmental Water Total Transfer Out General -$ -$ 404,000$ -$ 404,000$ Nonmajor governmental - 246,000 - 360,093 606,093 Water 79,693 42,456 - - 122,149 Sewer 75,691 51,891 - - 127,582 Storm Water 58,189 - - - 58,189 Total 213,573$ 340,347$ 404,000$ 360,093$ 1,318,013$ Transfer in Fund During the year, transfers are used to 1) move revenues from the fund with collection authorization to the Debt Service fund as debt service principal and interest payments become due and 2) move General fund resources to provide an annual subsidy to the transit fund. The City made the following one-time transfers for the year ended December 31, 2019: • The non-major governmental fund transferred $246,000 to the Debt Service fund for future debt service payments. The non-major governmental fund also transferred $360,093 to the Water fund for future debt service payments. • The Water fund ($79,693), Sewer fund ($75,691) and the Storm Water fund ($58,189) made budgeted transfers to the General fund for operating costs. • The Water fund ($42,456), and the Sewer fund ($51,891) made budgeted transfers to the Debt Service funds for debt service payments for the 2012 building bonds and for recharacterized water bonds. • The General fund made a budgeted transfer of $404,000 to the nonmajor governmental funds for future capital improvements. 61 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) D. Long-term Debt General Obligation Improvement Bonds The City issues G.O. improvement bonds to finance various improvements and will be repaid from special assessments levied on the properties benefiting from the improvements, tax increment from the district and ad valorem tax levies. All special assessment debt is backed by the full faith and credit of the City. Each year the combined assessment and tax levy equals 105 percent of the amount required for debt service. The excess of 5 percent is to cover any delinquencies in tax or assessment payments. Authorized Issue Maturity Balance at and Issued Date Date Year End G.O. Improvement Bonds, Series 2011B 870,000$ 0.75 - 4.00 %07/12/11 02/01/22 295,000$ G.O. Improvement Bonds, Series 2010A 315,000 1.50 - 3.85 07/07/10 02/01/21 60,000 G.O. Improvement Bonds, Series 2012A 6,100,000 1.50 - 2.75 11/07/12 02/01/34 5,235,000 G.O. Crossover Refunding Bonds, Series 2013A 1,170,000 1.75 - 2.00 04/25/13 02/01/23 615,000 G.O. Improvement Bonds, Series 2015A 1,765,000 2.00 - 3.00 06/24/15 02/01/31 1,400,000 G.O. Refunding Bond Series 2016A 1,220,000 2.00 08/11/16 02/01/24 890,000 G.O. Improvement Bonds, Series 2017A 1,210,000 2.00 - 3.00 06/24/15 02/01/31 1,210,000 Total General Obligation Improvement Bonds 9,705,000$ Interest RateDescription Annual debt service requirements to maturity for the general obligation improvement bonds are as follows: Year Ending December 31,Principal Interest Total 2020 830,000$ 207,561$ 1,037,561$ 2021 855,000 190,049 1,045,049 2022 820,000 172,716 992,716 2023 735,000 157,591 892,591 2024 760,000 143,244 903,244 2025 - 2029 3,030,000 514,947 3,544,947 2030 - 2034 2,675,000 158,688 2,833,688 Total 9,705,000$ 1,544,796$ 11,249,796$ Governmental Activities 62 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) General Obligation Tax Increment Bonds The G.O Refunding Bonds, Series 2012B were issued to refund tax increment bonds which were originally issued for storm water mitigation and road work within phase one of the TIF district. The bonds will be repaid with future tax increments collections. Authorized Issue Maturity Balance at and Issued Date Date Year End G.O. Refunding Bonds, Series 2012B 650,000$ 1.50 %11/07/12 02/01/21 175,000$ Rate Interest Description Annual debt service requirements to maturity for the general obligation tax increment bonds are as follows: Year Ending December 31,Principal Interest Total 2020 85,000$ 1,988$ 86,988$ 2021 90,000 675 90,675 Total 175,000$ 2,663$ 177,663$ Governmental Activities G.O. Revenue Bonds The following bonds were issued to finance capital improvements, and finance acquisition and construction of capital facilities. They will be repaid from future net revenues pledged from the Water fund and are backed by the taxing power of the City. Annual principal and interest payments on the bonds are expected to require over 50 percent of net revenues from the Water fund. For 2019, principal and interest paid and total customer net revenues for the Water fund were $591,581 and $1,055,766, respectively creating a pledged revenue percentage of 56.0%. Authorized Issue Maturity Balance at and Issued Date Date Year End G.O. Water Revenue Crossover Refunding Bonds, Series 2012B 2,195,000$ 1.50 %11/07/12 02/01/20 380,000$ G.O. Water Revenue Crossover Refunding Bonds, Series 2013A 1,520,000 1.75 - 2.00 04/25/13 02/01/23 790,000 Total G.O. Revenue Bonds 1,170,000$ Rate Interest Description Annual debt service requirements to maturity for the general obligation revenue bonds are as follows: Year Ending December 31,Principal Interest Total 2020 570,000$ 15,738$ 585,738$ 2021 195,000 9,038 204,038 2022 200,000 5,338 205,338 2023 205,000 1,792 206,792 Total 1,170,000$ 31,906$ 1,201,906$ Business-type Activities 63 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) Changes in Long-term Liabilities Long-term liability activity for the year ended December 31, 2019, was as follows: Beginning Ending Due Within Balance Increases Decreases Balance One Year Governmental Activities Bonds Payable General obligation improvement bonds 10,445,000$ -$ (740,000)$ 9,705,000$ 830,000$ General obligation tax increment bonds 255,000 - (80,000) 175,000 85,000 Unamortized premium on bonds 149,793 - (20,271) 129,522 - Total Bonds Payable 10,849,793 - (840,271) 10,009,522 915,000 Compensated Absences Payable 335,783 249,010 (225,437) 359,356 107,477 Governmental Activities Long-term Liabilities 11,185,576$ 249,010$ (1,065,708)$ 10,368,878$ 1,022,477$ Business-type Activities Bonds Payable General obligations revenue bonds 1,735,000$ -$ (565,000)$ 1,170,000$ 570,000$ Unamortized premium on bonds 36,219 - (15,386) 20,833 - Total Bonds Payable 1,771,219 - (580,386) 1,190,833 570,000 Compensated Absences Payable 65,820 30,258 (38,244) 57,834 12,687 Business-type Activities Long-term Liabilities 1,837,039$ 30,258$ (618,630)$ 1,248,667$ 582,687$ 64 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 3: Detailed Notes on All Funds (Continued) E. Components of Fund Balance At December 31, 2019, portions of the City’s fund balance are not available for appropriation due to not being in spendable form (Nonspendable), legal restrictions (Restricted), City Council action (Committed), policy and/or intent (Assigned). The following is a summary of the components of fund balance: Other Debt Sewer Capital Governmental General Service Improvements Funds Total Nonspendable Prepaid items $ 72,802 $ - $ - $ - $ 72,802 Restricted for Park improvements $ - $ - $ - $ 1,238,690 $ 1,238,690 Debt service - 1,589,730 - - 1,589,730 Police expenditures - - - 204,436 204,436 Total Restricted $ - $ 1,589,730 $ - $ 1,443,126 $ 3,032,856 Committed to Park improvements $ - $ - $ - $ 638,309 $ 638,309 Police expenditures - - - 61,626 61,626 Field house - - - 8,038 8,038 German liberal cemetary - - - 155,299 155,299 Community event - - - 18,865 18,865 Cable - - - 21,347 21,347 Environmental - - - 527,411 527,411 Total Committed $ - $ - $ - $ 1,430,895 $ 1,430,895 Assigned to Capital improvements $ - $ - $ 3,122,661 $ 2,853,164 $ 5,975,825 Future benefits 120,164 - - - 120,164 Equipment replacement - - - 101,181 101,181 Total Assigned $ 120,164 $ - $ 3,122,661 $ 2,954,345 $ 6,197,170 65 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide A. Plan Description The City participates in the following cost-sharing multiple-employer defined benefit pension plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA’s defined benefit pension plans are established and administered in accordance with Minnesota statutes, chapters 353 and 356. PERA’s defined benefit pension plans are tax qualified plans under Section 401(a) of the Internal Revenue Code. General Employees Retirement Plan (GERP) All full-time and certain part-time employees of the City are covered by the General Employees Retirement Plan (GERP). GERP members belong to the Coordinated Plan. Coordinated Plan members are covered by Social Security. Public Employees Police and Fire Plan (PEPFP) The PEPFP, originally established for police officers and firefighters not covered by a local relief association, now covers all police officers and firefighters hired since 1980. Effective July 1, 1999, the PEPFP also covers police officers and firefighters belonging to a local relief association that elected to merge with and transfer assets and administration to PERA. B. Benefits Provided PERA provides retirement, disability and death benefits. Benefit provisions are established by state statute and can only be modified by the state Legislature. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. GERP Benefits GERP benefits are based on a member’s highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. Two methods are used to compute benefits for PERA's Coordinated Plan members. Members hired prior to July 1, 1989 receive the higher of Method 1 or Method 2 formulas. Only Method 2 is used for members hired after June 30, 1989. Under Method 1, the accrual rate for Coordinated members is 1.2 percent of average salary for each of the first 10 years of service and 1.7 percent of average salary for each additional year. Under Method 2, the accrual rate for Coordinated members is 1.7 percent for average salary for all years of service. For members hired prior to July 1, 1989 a full annuity is available when age plus years of service equal 90 and normal retirement age is 65. For members hired on or after July 1, 1989 normal retirement age is the age for unreduced Social Security benefits capped at 66. Annuities, disability benefits and survivor benefits are increased effective every January 1. Beginning January 1, 2019, the postretirement increase will be equal to 50 percent of the cost-of-living adjustment (COLA) announced by the SSA, with a minimum increase of at least 1 percent and a maximum of 1.5 percent. Recipients that have been receiving the annuity or benefit for at least a full year as of the June 30 before the effective date of the increase will receive the full increase. For recipients receiving the annuity or benefit for at least one month but less than a full year as of the June 30 before the effective date of the increase will receive a reduced prorated increase. For members retiring on January 1, 2024, or later, the increase will be delayed until normal retirement age (age 65 if hired prior to July 1, 1989, or age 66 for individuals hired on or after July 1, 1989). Members retiring under Rule of 90 are exempt from the delay to normal retirement. PEPFP Benefits Benefits for the PEPFP members first hired after June 30, 2010, but before July 1, 2014, vest on a prorated basis from 50 percent after five years up to 100 percent after ten years of credited service. Benefits for PEPFP members first hired after June 30, 2014 vest on a prorated basis from 50 percent after ten years up to 100 percent after twenty years of credited service. The annuity accrual rate is 3.0 percent of average salary for each year of service. A full, unreduced pension is earned when members are age 55 and vested, or for members who were first hired prior to July 1, 1989, when age plus years of service equal at least 90. 66 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide (Continued) Annuities, disability benefits and survivor benefits are increased effective every January 1. Beginning January 1, 2019, the postretirement increase will be fixed at 1 percent. Recipients that have been receiving the annuity or benefit for at least 36 months as of the June 30 before the effective date of the increase will receive the full increase. For recipients receiving the annuity or benefit for at least 25 months but less than 36 months as of the June 30 before the effective date of the increase will receive a reduced prorated increase. C. Contributions Minnesota statutes chapter 353 sets the rates for employer and employee contributions. Contribution rates can only be modified by the state Legislature. General Employees Fund Contributions Coordinated Plan members were required to contribute 6.50 percent of their annual covered salary in fiscal year 2019 and the City was required to contribute 7.50 percent for Coordinated Plan members. The City’s contributions to the GERP for the years ending December 31, 2019, 2018 and 2017 were $90,945, $88,679 and $85,109, respectively. The City’s contributions were equal to the required contributions for each year as set by state statute. Police and Fire Fund Contributions Police and Fire member’s contribution rates increased from 10.80 percent of pay to 11.30 percent and employer rates increased from 16.20 percent to 16.95 percent on January 1, 2019. The City’s contributions to the Police and Fire Fund for the years ending December 31, 2019, 2018 and 2017 were $152,505, $139,304 and $133,772, respectively. The City’s contributions were equal to the required contributions for each year as set by Minnesota statute. D. Pension Costs GERP Pension Costs At December 31, 2019, the City reported a liability of $928,834 for its proportionate share of the General Employees Fund’s net pension liability. The City’s net pension liability reflected a reduction due to the State of Minnesota’s contribution of $16 million to the fund in 2017. The State of Minnesota is considered a non-employer contributing entity and the state’s contribution meets the definition of a special funding situation. The State of Minnesota’s proportionate share of the net pension liability associated with the City totaled $28,999. The net pension liability was measured as of June 30, 2019, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportionate share of the net pension liability was based on the City’s contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2018 through June 30, 2019 relative to the total employer contributions received from all of PERA’s participating employers. At June 30, 2019, the City’s proportionate share was 0.0168 percent which was a decrease of 0.0007 percent from its proportion measured as of June 30, 2018. City's Proportionate Share of the Net Pension Liability 928,834$ State of Minnesota's Proportionate Share of the Net Pension Liability Associated with the City 28,999 Total 957,833$ For the year ended December 31, 2019, the City recognized pension expense of $120,590 for its proportionate share of the General Employees Plan’s pension expense. In addition, the City $2,172 as pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s contribution of $16 million to the General Employees Fund. 67 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide (Continued) At December 31, 2019, the City reported its proportionate share of the General Employees Plan’s deferred outflows of resources and deferred inflows of resources, and its contributions subsequent to the measurement date, from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Economic Experience 32,218$ 2,554$ Changes in Actuarial Assumptions 4,322 77,891 Net Difference Between Projected and Actual Earnings on Plan Investments - 98,260 Changes in Proportion 12,881 43,340 Contributions Paid to PERA Subsequent to the Measurement Date 45,117 - Total 94,538$ 222,045$ The $45,117 related to pensions resulting from the City’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2020. Other amounts reported as deferred outflows and inflows of resources related to GERP pensions will be recognized in pension expense as follows: (64,195)$ (78,673) (31,253) 1,497 2020 2021 2022 2023 Police and Fire Fund Pension Costs At December 31, 2019, the City reported a liability of $892,136 for its proportionate share of the Police and Fire Fund’s net pension liability. The net pension liability was measured as of June 30, 2019, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportionate share of the net pension liability was based on the City’s contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2018 through June 30, 2019 relative to the total employer contributions received from all of PERA’s participating employers. At June 30, 2019, the City’s proportionate share was 0.0838 percent which was an increase of 0.0047 percent from its proportionate share measured as of June 30, 2018. For the year ended December 31, 2019, the City recognized pension expense of $160,068 for its proportionate share of Police and Fire Plan’s pension expense. The City also recognized $11,313 for the year ended December 31, 2019, as revenue and an offsetting reduction of net pension liability for its proportionate share of the State of Minnesota’s on-behalf contributions to the Police and Fire Fund. Legislation passed in 2013 required the State of Minnesota to begin contributing $9 million to the Police and Fire Fund each year until the plan is 90 percent funded or until the State Patrol Plan (administered by the Minnesota State Retirement System) is 90 percent funded, whichever occurs later. In addition, the state will pay $4.5 million on October 1, 2018 and October 1, 2019 in direct state aid. Thereafter, by October 1 of each year, the state will pay $9 million until full funding is reached or July 1, 2048, whichever is earlier. 68 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide (Continued) At December 31, 2019, the City reported its proportionate share of Police and Fire Plan’s deferred outflows of resources and deferred inflows of resources, and its contributions subsequent to the measurement date, from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Economic Experience 48,875$ 161,435$ Changes in Actuarial Assumptions 821,583 1,082,354 Net Difference Between Projected and Actual Earnings on Plan Investments - 167,645 Changes in Proportion 67,704 83,293 Contributions Paid to PERA Subsequent to the Measurement Date 77,420 - Total 1,015,582$ 1,494,727$ The $77,420 reported as deferred outflows of resources related to pensions resulting from the City’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2020. Other amounts reported as deferred outflows and inflows of resources related to GERP pensions will be recognized in pension expense as follows: (79,783)$ (145,582) (350,628) 6,886 12,542 2020 2021 2022 2023 2024 E. Actuarial Assumptions The total pension liability in the June 30, 2019 actuarial valuation was determined using an individual entry-age normal actuarial cost method and the following actuarial assumptions: Inflation 2.50% per year Active Member Payroll Growth 3.25% per year Investment Rate of Return 7.50% F. Salary increases were based on a service-related table. Mortality rates for active members, retirees, survivors and disabilitants were based on RP-2014 tables for males or females, as appropriate, with slight adjustments to fit PERA’s experience. Cost of living benefit increases after retirement for retirees are assumed to be 1.25 percent per year for General Employees Plan and 1.0 percent per year for Police and Fire Plan. Actuarial assumptions used in the June 30, 2019 valuation were based on the results of actuarial experience studies. The most recent four-year experience study in the General Employees Plan was completed in 2019. The most recent four-year experience study for the Police and Fire Plan was completed in 2016. Economic assumptions were updated in 2018 based on a review of inflation and investment return assumptions. 69 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The following changes in actuarial assumptions and plan provisions occurred in 2019: General Employees Fund Changes in Actuarial Assumptions • The mortality projection scale was changed from MP-2017 to MP-2018. Changes in Plan Provisions • The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million per year. The State’s special funding contribution was changed prospectively, requiring $16.0 million due per year through 2031. Police and Fire Fund Changes in Actuarial Assumptions • The mortality projection scale was changed from MP-2017 to MP-2018. Changes in Plan Provisions • There have been no changes since the prior valuation. The State Board of Investment, which manages the investments of PERA, prepares an analysis of the reasonableness on a regular basis of the long-term expected rate of return basis using a building-block method in which best-estimate ranges of expected future rates of return are developed for each major asset class. These ranges are combined to produce an expected long-term rate of return by weighting the expected future rates of return by the target asset allocation percentages. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table: Asset Class Domestic Equity 35.5 %5.10 % Private Markets 25.0 5.90 Fixed Income 20.0 0.75 International Equity 17.5 5.90 Cash Equivalents 2.0 - Total 100.0 % Target Expected Real Allocation Rate of Return Long-term F. Discount Rate The discount rate used to measure the total pension liability in 2019 was 7.50 percent. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net position of the General Employees Fund and the Police and Fire Fund were projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 70 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 4: Defined Benefit Pension Plans - Statewide (Continued) G. Pension Liability Sensitivity The following presents the City’s proportionate share of the net pension liability for all plans it participates in, calculated using the discount rate disclosed in the preceding paragraph, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate 1 percentage point lower or 1 percentage point higher than the current discount rate: 1 Percent 1 Percent Decrease (6.50%) Current (7.50%) Increase (8.50%) General Employees Fund 1,526,954$ 928,834$ 434,968$ Police and Fire Fund 1,950,043 892,136 17 H. Pension Plan Fiduciary Net Position Detailed information about each pension plan’s fiduciary net position is available in a separately-issued PERA financial report that includes financial statements and required supplementary information. That report may be obtained on the internet at www.mnpera.org. Note 5: Postemployment Benefits Other Than Pensions A. Plan Description The City operates a single-employer retiree benefit plan ("the Plan") that provides health, life and dental insurance to eligible employees and their families through the City's health insurance plan. The full cost of the benefits is covered by the plan. Benefit and eligibility provisions are established through negotiations between the City and various unions representing City employees and are renegotiated each two-year bargaining period. The Plan does not issue a publicly available report. At December 31, 2019, 25 active plan members were covered by the benefit terms. B. Funding Policy Contribution requirements are also negotiated between the City and union representatives. The City contributes a predetermined portion of the cost of current-year premiums for eligible retired plan members and their spouses based on the employment contract in effect at the time of retirement. For the year ended December 31, 2019, the City’s average contribution rate was 6.15 percent of covered-employee payroll. C. Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities, consistent with the long-term perspective of the calculations. The City’s total OPEB liability of $123,097 was measured as of December 31, 2018, and the total OPEB liability used to calculate the total OPEB liability was determined by an actuarial valuation as of January 1, 2019. Roll forward procedures were used to roll forward the total OPEB liability to the measurement date. 71 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 5: Postemployment Benefits Other Than Pensions (Continued) The total OPEB liability in the January 1, 2017 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified: Discount Rate 20-Year Municipal Bond Yield Inflation Rate Salary Increases 2.74% 2.74% 2.75% 3.50% Medical Trend Rate 8.00% in 2019 decreasing 0.50% per year to ultimate rate of 5.00 The discount rate used to measure the total OPEB liability was 2.74 percent. The plan is not funded. Benefit payments are discounted at the 20-year municipal bond rate. The equivalent single rate is the discount rate. Mortality rates were based on the RP-2014 White Collar Mortality Tables with MP-2016 Generational Improvement Scale. The actuarial assumptions used in the December 31, 2019 valuation were based on input from a variety of published sources of historical and projected future financial data. Each assumption was reviewed for reasonableness with the source information as well as for consistency with the other economic assumptions. D.Changes in the Total OPEB Liability Total OPEB Liability (a) Balances at December 31, 2018 96,841$ Changes for the Year: Service cost 6,415 Interset 4,208 Differences between expected and actual experience 8,257 Changes in assumptions or other inputs 8,104 Benefit payments (728) Net Changes 26,256 Balances at December 31, 2019 123,097$ In 2019, there were no benefit changes. 72 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 5: Postemployment Benefits Other Than Pensions (Continued) E. Sensitivity of the Total OPEB Liability The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (1.74 percent) or 1-percentage-point higher (3.74 percent) than the current discount rate: 1 Percent 1 Percent Decrease (1.74%)Current (2.74%)Decrease (3.74%) 135,145$ 123,097$ 112,056$ The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using a Healthcare Cost Trent Rates that is 1-percentage point lower (8 percent decreasing to 6.00 percent) or 1-percentage-point higher (8 percent increasing to 9.00 percent) than the current discount rate: Healthcare Cost 1 Percent Decrease Trend Rates 1 Percent Increase (6% Decreasing (8% Decreasing (9% Decreasing to 4%)to 5%)to 6%) 107,328$ 123,097$ 141,699$ F. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB For the year ended December 31, 2019, the City recognized OPEB expense of $11,395. At December 31, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: Deferred Outflows Deferred Inflows of Resources of Resources Differences Between Expected and Actual Experience 7,580$ -$ Changes in Actuarial Assumptions 7,440 (5,289) 15,020$ (5,289)$ 73 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 5: Postemployment Benefits Other Than Pensions (Continued) December 31, 2020. Other amounts reported as deferred outflows and inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year Ended December 31: 2020 772$ 2021 772 2022 772 2023 772 2024 772 Thereafter 5,871 Note 6: Other Information A. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters for which the City carries insurance. The City obtains insurance through participation in the League of Minnesota Cities Insurance Trust (LMCIT), which is a risk sharing pool with approximately 800 other governmental units. The City pays an annual premium to LMCIT for its workers compensation and property and casualty insurance. The LMCIT is self-sustaining through member premiums and will reinsure for claims above a prescribed dollar amount for each insurance event. Settled claims have not exceeded the City’s coverage in any of the past three fiscal years. Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities, if any, include an amount for claims that have been incurred but not reported (IBNRs). The City’s management is not aware of any incurred but not reported claims. B. Legal Debt Margin In accordance with Minnesota statutes, the City may not incur or be subject to net debt in excess of 3 percent of the market value of taxable property within the City. The City has no debt applicable to this limit at year end. C. Tax Increment Districts The City’s tax increment district is subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. 74 City of Medina, Minnesota Notes to the Financial Statements December 31, 2019 Note 7: Jointly Governed Organizations Pioneer - Sarah Creek Watershed Management Commission The Cities of Independence, Loretto, Maple Plain, Medina, Minnetrista, and Greenfield, Minnesota, as equal participants, are the members of the Pioneer - Sarah Creek Watershed Management Commission (the “Commission”). The purpose of the Commission is to preserve and use natural water management programs required by Minnesota Statutes 103B.201 to 103B.251. The Commission is governed by a board comprised of one representative and one alternate of each Member City. The City remitted $14,839 to the commission in 2019. The contribution as reported in the City’s Water Resource Department fund. Complete financial statements for the Commission can be obtained at the City’s Municipal Center. Note 8: Conduit Debt Obligations The City has issued revenue obligations to finance and refinance, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement The financing authorized the issuance of $7,000,000. The City hereby authorizes the Note to be issued as a “tax-exempt bond” the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. At December 31, 2019, the balance of the bond outstanding was $6,770,259. Neither, the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. The City has issued revenue bonds to provide financial assistance to private-sector entities to finance multifamily housing developments. The financing authorized the issuance not to exceed $10,000,000. The City hereby authorizes the Note to be issued as a “tax-exempt bond” the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. At December 31, 2019, the balance of the bond outstanding was $10,000,000. Neither, the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. Note 9: Subsequent Event In December 2019, a novel strain of coronavirus (COVID-19) surfaced. The spread of COVID-19 around the world in the first quarter of 2020 has caused significant volatility in U.S. and international markets. There is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies and, as such, the City is unable to determine if it will have a material impact to its operations. Note 10: Change in Accounting Principle During fiscal year 2019, the City implemented a new accounting pronouncement issued by the Government Accounting Standards Board (GASB), Statement No. 84, Fiduciary Activities. This standard required a retroactive implementation which resulted in the restatement of beginning balances in the December 31, 2019 financial statements. Changes related to this standard are reflected in the financial statements and related disclosures. 75 THIS PAGE IS LEFT BLANK INTENTIONALLY 76 REQUIRED SUPPLEMENTARY INFORMATION CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 77 City of Medina, Minnesota Required Supplemental Information For the Year Ended December 31, 2019 Schedule of Employer’s Share of PERA Net Pension Liability - General Employees Fund State's Proportionate City's Share of Proportionate the Net Pension Share of Liability City's Fiscal the Net Pension Associated with Covered Year Liability the City Total Payroll Ending (a)(b)(a+b)(c) 06/30/19 0.0168 %928,834$ 28,999$ 957,833$ 1,191,702$ 80.4 %80.2 % 06/30/18 0.0175 970,828 31,891 1,002,719 1,179,495 85.0 79.5 06/30/17 0.0171 1,091,653 13,726 1,091,653 1,101,593 100.3 75.9 06/30/16 0.0178 1,445,272 18,946 1,464,218 1,106,840 132.3 68.9 06/30/15 0.0166 860,298 - 860,298 977,965 88.0 78.2 City's Proportionate Share of the Net Pension City's Liability as a Plan Fiduciary the Net Pension Payroll of the Total Liability ((a+b)/c)Pension Liability Net Position Proportion of Percentage of as a PercentageCovered Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer’s PERA Contributions - General Employees Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Required Required Deficiency Covered Year Contribution Contribution (Excess)Payroll Ending (a)(b)(a-b)(c) 12/31/19 90,945$ 90,945$ -$ 1,212,601$ 7.50 % 12/31/18 88,679 88,679 - 1,182,386 7.50 12/31/17 85,109 85,109 - 1,134,782 7.50 12/31/16 81,610 81,610 - 1,088,133 7.50 12/31/15 77,467 77,467 - 1,032,893 7.50 (b/c) Contributions as a Percentage of Covered Payroll Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 78 City of Medina, Minnesota Required Supplemental Information (Continued) For the Year Ended December 31, 2019 Notes to the Required Supplementary Information - General Employee Fund Changes in Actuarial Assumptions 2019 - The mortality projection scale was changed from MP-2017 to MP-2018. 2018 - The mortality projection scale was changed from MP-2015 to MP-2017. The assumed benefit increase was changed from 1.00 percent per year through 2044 and 2.50 percent per year thereafter to 1.25 percent per year. 2017 - The Combined Service Annuity (CSA) loads were changed from 0.8 percent for active members and 60 percent for vested and non-vested deferred members. The revised CSA loads are now 0.0 percent for active member liability, 15.0 percent for vested deferred member liability and 3.0 percent for non-vested deferred member liability. The assumed post- retirement benefit increase rate was changed from 1.0 percent per year for all years to 1.0 percent per year through 2044 and 2.5 percent per year thereafter. 2016 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2035 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 7.5 percent. Other assumptions were changed pursuant to the experience study dated June 30, 2015. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2035 and 2.5 percent per year thereafter. Changes in Plan Provisions 2019 - The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million per year. The state’s special funding contribution was changed prospectively, requiring $16.0 million due per year through 2031. 2018 - The augmentation adjustment in early retirement factors is eliminated over a five-year period starting July 1, 2019, resulting in actuarial equivalence after June 30, 2024. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Contribution stabilizer provisions were repealed. Postretirement benefit increases were changed from 1.00 percent per year with a provision to increase to 2.50 percent upon attainment of 90.00 percent funding ratio to 50.00 percent of the Social Security Cost of Living Adjustment, not less than 1.00 percent and not more than 1.50 percent, beginning January 1, 2019. For retirements on or after January 1, 2024, the first benefit increase is delayed until the retiree reaches normal retirement age; does not apply to Rule of 90 retirees, disability benefit recipients, or survivors. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017 - The State’s contribution for the Minneapolis Employees Retirement Fund equals $16,000,000 in 2017 and 2018, and $6,000,000 thereafter. The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund changed from $21,000,000 to $31,000,000 in calendar years 2019 to 2031. The state’s contribution changed from $16,000,000 to $6,000,000 in calendar years 2019 to 2031. 2015 - On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General Employees Fund, which increased the total pension liability by $1.1 billion and increased the fiduciary plan net position by $892 million. Upon consolidation, state and employer contributions were revised. 79 City of Medina, Minnesota Required Supplemental Information (Continued) For the Year Ended December 31, 2019 Schedule of Employer’s Share of PERA Net Pension Liability - Police and Fire Fund State's Proportionate City's Share of Proportionate the Net Pension Share of Liability City's Fiscal the Net Pension Associated with Covered Year Liability the City Total Payroll Ending (a)(b)(a+b)(c) 06/30/19 0.0838 %892,136$ -$ 892,136$ 892,136$ 100.9 %89.3 % 06/30/18 0.0791 843,125 - 843,125 833,645 101.1 88.8 06/30/17 0.0790 1,066,594 - 1,066,594 813,313 131.1 85.4 06/30/16 0.0870 3,491,461 - 3,491,461 841,198 415.1 63.9 06/30/15 0.0900 1,022,611 - 1,022,611 822,038 124.4 86.6 Liability as a Plan Fiduciary City's Proportionate Share of the Net Pension City's Percentage of Net Position Proportion of Covered as a Percentage the Net Pension Payroll of the Total Liability ((a+b)/c)Pension Liability Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer’s PERA Contributions - Police and Fire Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Required Required Deficiency Covered Year Contribution Contribution (Excess)Payroll Ending (a)(b)(a-b)(c) 12/31/19 152,505$ 152,505$ -$ 899,735$ 16.95 % 12/31/18 139,304 139,304 - 859,900 16.20 12/31/17 133,772 133,772 - 825,751 16.20 12/31/16 131,872 131,872 - 814,025 16.20 12/31/15 130,345 130,345 - 804,599 16.20 (b/c) Contributions as a Percentage of Covered Payroll Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 80 City of Medina, Minnesota Required Supplemental Information (Continued) For the Year Ended December 31, 2019 Notes to the Required Supplementary Information - Police and Fire Fund Changes in Actuarial Assumptions 2019 - The mortality projection scale was changed from MP-2017 to MP-2018. 2018 - The mortality projection scale was changed from MP-2016 to MP-2017. As set by statute, the assumed post- retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. 2017 - Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The Combined Service Annuity (CSA) load was 30 percent for vested and non-vested deferred members. The CSA has been changed to 33 percent for vested members and 2 percent for non-vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.0 percent for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65 percent to 60 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed post-retirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.6 percent to 7.5 percent. 2016 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2037 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 5.6 percent. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2037 and 2.5 percent per year thereafter. 81 City of Medina, Minnesota Required Supplemental Information (Continued) For the Year Ended December 31, 2019 Notes to the Required Supplementary Information - Police and Fire Fund (Continued) Changes in Plan Provisions 2018 - As set by statute, the assumed post-retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. An end date of July 1, 2048 was added to the existing $9.0 million state contribution. New annual state aid will equal $4.5 million in fiscal years 2019 and 2020, and $9.0 million thereafter until the plan reaches 100 percent funding, or July 1, 2048, if earlier. Member contributions were changed from 10.80 percent to 11.30 percent of pay, effective January 1, 2019 and 11.80 percent of pay, effective January 1, 2020. Employer contributions were changed from 16.20 percent to 16.95 percent of pay, effective January 1, 2019 and 17.70 percent of pay, effective January 1, 2020. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017- Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The combined service annuity (CSA) load was 30.00 percent for vested and non-vested, deferred members. The CSA has been changed to 33.00 percent for vested members and 2.00 percent for non-vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.00 percent for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65.00 percent to 60.00 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed postretirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.60 percent per annum to 7.50 percent per annum. 2015 - The post-retirement benefit increase to be paid after attainment of the 90 percent funding threshold was changed, from inflation up to 2.5 percent, to a fixed rate of 2.5 percent. 82 City of Medina, Minnesota Required Supplemental Information (Continued) For the Year Ended December 31, 2019 Schedule of Changes in the City’s Total OPEB Liability 2019 2018 Total OPEB Liability Service cost 6,415$ 6,650$ Interest 4,208 3,467 Differences between expected and actual experience 8,257 - Changes in assumptions 8,104 (6,427) Benefit payments (729) (1,956) Net Change in Total OPEB Liability 26,255 1,734 Total OPEB Liability - Beginning 96,842 95,108 Total OPEB Liability - Ending 123,097$ 96,842$ Covered - Employee Payroll 2,000,000$ 1,900,000$ City's total OPEB liability as a percentage of covered employee payroll 6.2 %5.1 % Benefit Changes: In 2019, there wer no benefit changes Changes in Assumptions: In 2019, there were no assumptions changes Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 83 THIS PAGE IS LEFT BLANK INTENTIONALLY 84 COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 85 City of Medina, Minnesota Nonmajor Governmental Funds Combining Balance Sheet December 31, 2019 Total Nonmajor Special Capital Governmental Revenue Projects Funds Assets Cash and temporary investments 1,268,495$ 4,586,474$ 5,854,969$ Receivables Accounts - 31,815 31,815 Special assessments - 319,702 319,702 Due from other governments 114 2,928 3,042 Total Assets 1,268,609$ 4,940,919$ 6,209,528$ Liabilities Accounts payable -$ 26,525$ 26,525$ Due to other funds - 117,408 117,408 Due to other governments - 1,443 1,443 Unearned revenue 2,267 31,815 34,082 Total Liabilities 2,267 177,191 179,458 Deferred Inflows of Resources Unavailable revenue - assessments - 319,702 319,702 Fund Balances Restricted 204,436 1,238,690 1,443,126 Committed 1,061,906 368,989 1,430,895 Assigned - 2,954,345 2,954,345 Unassigned - (117,998) (117,998) Total Fund Balances 1,266,342 4,444,026 5,710,368 Total Liabilities, Deferred Inflows of Resources, and Fund Balances 1,268,609$ 4,940,919$ 6,209,528$ 86 City of Medina, Minnesota Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2019 Total Nonmajor Special Capital Governmental Revenue Projects Funds Revenues Taxes Property taxes 14,069$ 135,161$ 149,230$ Tax increments - 491,715 491,715 Franchise fees 61,648 - 61,648 Intergovernmental - 44,200 44,200 Charges for services 4,960 595,555 600,515 Fines and forfeitures 122,418 - 122,418 Special assessments - 284,244 284,244 Interest on investments 40,143 159,554 199,697 Miscellaneous 318,303 392,223 710,526 Total Revenues 561,541 2,102,652 2,664,193 Expenditures Current Public safety 9,475 - 9,475 Culture and recreation 80,552 - 80,552 Capital outlay General government - 13,716 13,716 Public safety 61,102 259,172 320,274 Streets and highways - 905,745 905,745 Culture and recreation 16,355 47,276 63,631 Economic development - 190,872 190,872 Total Expenditures 167,484 1,416,781 1,584,265 Excess of Revenues Over Expenditures 394,057 685,871 1,079,928 Other Financing Sources (Uses) Proceeds from sale of capital assets - 35,880 35,880 Transfers in 4,000 400,000 404,000 Transfers out - (606,093) (606,093) Total Other Financing Sources (Uses)4,000 (170,213) (166,213) Net Change in Fund Balances 398,057 515,658 913,715 Fund Balances, January 1 868,285 3,928,368 4,796,653 Fund Balances, December 31 1,266,342$ 4,444,026$ 5,710,368$ 87 City of Medina, Minnesota Nonmajor Special Revenue Funds Combining Balance Sheet December 31, 2019 204 226 227 235 Municipal Field Police Environmental Park House Forfeiture Assets Cash and temporary investments 527,411$ 271,473$ 8,038$ 248,123$ Due from other governments - 114 - - Total Assets 527,411$ 271,587$ 8,038$ 248,123$ Liabilities Unearned revenue -$ 2,267$ -$ -$ Fund Balances Restricted - - - 204,436 Committed 527,411 269,320 8,038 43,687 Total Fund Balances 527,411 269,320 8,038 248,123 Total Liabilities and Fund Balances 527,411$ 271,587$ 8,038$ 248,123$ 88 236 238 240 250 Police Reserve German Liberal Community Cable Equipment Cemetery Event Franchise Total 17,939$ 155,299$ 18,865$ 21,347$ 1,268,495$ - - - - 114 17,939$ 155,299$ 18,865$ 21,347$ 1,268,609$ -$ -$ -$ -$ 2,267$ - - - - 204,436 17,939 155,299 18,865 21,347 1,061,906 17,939 155,299 18,865 21,347 1,266,342 17,939$ 155,299$ 18,865$ 21,347$ 1,268,609$ 89 City of Medina, Minnesota Nonmajor Special Revenue Funds Combining Statement of Revenue, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2019 204 226 227 235 Municipal Field Police Environmental Park House Forfeiture Revenues Taxes Property -$ 14,069$ -$ -$ Franchise fees - - - - Charges for services - - - - Fines and forfeitures - - - 122,418 Interest on investments 13,618 6,620 299 7,697 Miscellaneous 165,476 123,782 1,668 2,227 Total Revenues 179,094 144,471 1,967 132,342 Expenditures Current Public safety - - - 7,687 Culture and recreation 45,630 - 4,285 - Capital outlay Public safety - - - 61,102 Culture and recreation - 16,355 - - Total Expenditures 45,630 16,355 4,285 68,789 Excess (Deficiency) of Revenues Over (Under) Expenditures 133,464 128,116 (2,318) 63,553 Other Financing Sources Transfers in - - - - Net Change in Fund Balances 133,464 128,116 (2,318) 63,553 Fund Balances, January 1 393,947 141,204 10,356 184,570 Fund Balances, December 31 527,411$ 269,320$ 8,038$ 248,123$ 90 236 238 240 250 Police Reserve German Liberal Community Cable Equipment Cemetery Event Franchise Total -$ -$ -$ -$ 14,069$ - - - 61,648 61,648 1,125 3,835 - - 4,960 - - - - 122,418 566 4,908 634 5,801 40,143 350 - 24,800 - 318,303 2,041 8,743 25,434 67,449 561,541 1,788 - - - 9,475 - 4,149 13,024 13,464 80,552 - - - - 61,102 - - - - 16,355 1,788 4,149 13,024 13,464 167,484 253 4,594 12,410 53,985 394,057 - - 4,000 - 4,000 253 4,594 16,410 53,985 398,057 17,686 150,705 2,455 (32,638) 868,285 17,939$ 155,299$ 18,865$ 21,347$ 1,266,342$ 91 City of Medina, Minnesota Nonmajor Capital Projects Funds Combining Balance Sheet December 31, 2019 225 401 402 406 General Water Tax Park Capital Capital Increment Dedication Improvement Improvement 1-9 Assets Cash and temporary investments 1,607,679$ 317,969$ 1,483,661$ -$ Receivables Accounts - - 31,815 - Special assessments - - - - Due from other governments - - - 1,438 Total Assets 1,607,679$ 317,969$ 1,515,476$ 1,438$ Liabilities Accounts payable -$ -$ -$ 585$ Due to other funds - - - 117,408 Due to other governments - - - 1,443 Unearned revenue - - 31,815 - Total Liabilities - - 31,815 119,436 Deferred Inflows of Resources Unavailable revenue - assessments - - - - Fund Balances Restricted 1,238,690 - - - Committed 368,989 - - - Assigned - 317,969 1,483,661 - Unassigned - - - (117,998) Total Fund Balances 1,607,679 317,969 1,483,661 (117,998) Total Liabilities, Deferred Inflows of Resources, and Fund Balances 1,607,679$ 317,969$ 1,515,476$ 1,438$ 92 411 420 Equipment Road Replacement Improvement Total 102,935$ 1,074,230$ 4,586,474$ - - 31,815 - 319,702 319,702 1,096 394 2,928 104,031$ 1,394,326$ 4,940,919$ 2,850$ 23,090$ 26,525$ - - 117,408 - - 1,443 - - 31,815 2,850 23,090 177,191 - 319,702 319,702 - - 1,238,690 - - 368,989 101,181 1,051,534 2,954,345 - - (117,998) 101,181 1,051,534 4,444,026 104,031$ 1,394,326$ 4,940,919$ 93 City of Medina, Minnesota Nonmajor Capital Projects Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2019 225 401 402 406 General Water Tax Park Capital Capital Increment Dedication Improvement Improvement 1-9 Revenues Taxes Property taxes -$ -$ -$ -$ Tax increments - - - 491,715 Intergovernmental 44,200 - - - Charges for services 8,854 - 586,701 - Special assessments - - 100,000 - Interest on investments 50,608 7,947 47,938 - Miscellaneous - 4,200 - - Total Revenues 103,662 12,147 734,639 491,715 Expenditures Capital outlay General government - 4,338 - - Public safety - - - - Streets and highways - - 23 - Culture and recreation 27,016 20,260 - - Economic development - - - 190,872 Total Expenditures 27,016 24,598 23 190,872 Excess (Deficiency) of Revenues Over (Under) Expenditures 76,646 (12,451) 734,616 300,843 Other Financing Sources (Uses) Proceeds from sale of capital assets - - - - Transfers in - 200,000 - - Transfer out - - (360,093) (246,000) Total Other Financing Sources (Uses)- 200,000 (360,093) (246,000) Net Change in Fund Balances 76,646 187,549 374,523 54,843 Fund Balances, January 1 1,531,033 130,420 1,109,138 (172,841) Fund Balances, December 31 1,607,679$ 317,969$ 1,483,661$ (117,998)$ 94 411 420 Equipment Road Replacement Improvement Total 135,161$ -$ 135,161$ - - 491,715 - - 44,200 - - 595,555 - 184,244 284,244 6,526 46,535 159,554 88,957 299,066 392,223 230,644 529,845 2,102,652 9,378 - 13,716 259,172 - 259,172 357,543 548,179 905,745 - - 47,276 - - 190,872 626,093 548,179 1,416,781 (395,449) (18,334) 685,871 35,880 - 35,880 200,000 - 400,000 - - (606,093) 235,880 - (170,213) (159,569) (18,334) 515,658 260,750 1,069,868 3,928,368 101,181$ 1,051,534$ 4,444,026$ 95 City of Medina, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (Continued on the Following Pages) For the Year Ended December 31, 2019 (With Comparative Actual Amounts for the Year Ended December 31, 2018) 2018 Actual Variance with Actual Original Final Amounts Final Budget Amounts Revenues Taxes Property taxes 3,358,897$ 3,358,897$ 3,367,192$ 8,295$ 3,206,239$ Licenses and permits 270,100 270,100 418,547 148,447 409,983 Intergovernmental Federal 27,000 27,000 22,576 (4,424) 22,701 State Property tax credits 4,000 4,000 3,812 (188) 4,059 Police state aid 85,000 85,000 102,586 17,586 88,354 Fire state aid 40,000 40,000 49,886 9,886 45,332 PERA aid 1,773 1,773 1,773 - 1,773 Other grants and aids 93,137 93,137 101,981 8,844 93,592 County Other grants and aids 13,000 13,000 12,853 (147) 16,154 Total intergovernmental 263,910 263,910 295,467 31,557 271,965 Charges for services General government 22,200 22,200 24,878 2,678 19,617 Public safety 178,846 178,846 256,690 77,844 248,948 Public works 4,400 4,400 4,777 377 4,593 Culture and recreation 25,000 25,000 48,744 23,744 39,283 Total charges for services 230,446 230,446 335,089 104,643 312,441 Fines and forfeitures 110,000 110,000 98,187 (11,813) 88,044 Special assessments 1,715 1,715 444 (1,271) 1,761 Interest on investments 20,000 20,000 116,324 96,324 45,460 Miscellaneous Contributions and donations 31,000 31,000 15,358 (15,642) 30,250 Other 72,697 72,697 91,896 19,199 139,835 Total miscellaneous 103,697 103,697 107,254 3,557 170,085 Total Revenues 4,358,765 4,358,765 4,738,504 379,739 4,505,978 2019 Budgeted Amounts 96 City of Medina, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (Continued) For the Year Ended December 31, 2019 (With Comparative Actual Amounts for the Year Ended December 31, 2018) 2018 Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures Current General government Mayor and council Personal services 19,694$ 19,694$ 17,494$ 2,200$ 17,494$ Other services and charges 8,050 8,050 8,770 (720) 7,780 Total mayor and council 27,744 27,744 26,264 1,480 25,274 Administration Personal services 522,623 522,623 503,948 18,675 485,876 Supplies 5,100 5,100 3,172 1,928 4,043 Other services and charges 103,005 103,005 225,074 (122,069) 109,417 Total administration 630,728 630,728 732,194 (101,466) 599,336 Elections Personal services 6,000 6,000 - 6,000 10,039 Supplies 800 800 298 502 939 Other services and charges 4,450 4,450 1,080 3,370 4,257 Total elections 11,250 11,250 1,378 9,872 15,235 Assessing Supplies 250 250 - 250 - Other services and charges 93,590 93,590 101,144 (7,554) 91,229 Total assessing 93,840 93,840 101,144 (7,304) 91,229 Planning and zoning Personal services 137,111 137,111 133,991 3,120 131,486 Supplies 800 800 (140) 940 249 Other services and charges 59,500 59,500 50,642 8,858 38,156 Total planning and zoning 197,411 197,411 184,493 12,918 169,891 PW/PD facility Supplies - - 814 (814) 690 Other services and changes 76,915 76,915 71,967 4,948 80,843 Total PW/PD facility 76,915 76,915 72,781 4,134 81,533 Budgeted Amounts 2019 97 City of Medina, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (Continued) For the Year Ended December 31, 2019 (With Comparative Actual Amounts for the Year Ended December 31, 2018) 2018 Actual Variance with Actual Original Final Amounts Final Budget Amounts Budgeted Amounts 2019 Expenditures (Continued) Current (continued) General government (continued) Other general government Supplies 18,800$ 18,800$ 22,630$ (3,830)$ 21,680$ Other services and changes 123,593 123,593 108,366 15,227 98,961 Total other general government 142,393 142,393 130,996 11,397 120,641 Total general government 1,180,281 1,180,281 1,249,250 (68,969) 1,103,139 Public safety Police Personal services 1,428,125 1,428,125 1,436,687 (8,562) 1,446,047 Supplies 60,150 60,150 62,943 (2,793) 58,506 Other services and charges 175,150 175,150 161,921 13,229 155,621 Total police 1,663,425 1,663,425 1,661,551 1,874 1,660,174 Building inspection Personal services 171,193 171,193 156,494 14,699 147,638 Supplies - - - - 606 Other services and charges 147,150 147,150 182,677 (35,527) 261,121 Total building inspection 318,343 318,343 339,171 (20,828) 409,365 Fire Other services and charges 446,242 446,242 425,597 20,645 413,375 Total public safety 2,428,010 2,428,010 2,426,319 1,691 2,482,914 Streets and highways Streets Personal services 307,747 307,747 361,589 (53,842) 296,210 Supplies 214,080 214,080 214,190 (110) 216,163 Other services and charges 206,050 206,050 176,648 29,402 129,341 Total streets and highways 727,877 727,877 752,427 (24,550) 641,714 Sanitation and recycling Personal services 11,130 11,130 11,222 (92) 10,558 Supplies 4,500 4,500 566 3,934 580 Other services and charges 4,450 4,450 3,245 1,205 1,430 Total sanitation and recycling 20,080 20,080 15,033 5,047 12,568 98 City of Medina, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (Continued) For the Year Ended December 31, 2019 (With Comparative Actual Amounts for the Year Ended December 31, 2018) 2018 Actual Variance with Actual Original Final Amounts Final Budget Amounts Budgeted Amounts 2019 Expenditures (Continued) Current (continued) Culture and recreation Personal services 83,315$ 83,315$ 96,534$ (13,219)$ 126,349$ Supplies 29,420 29,420 10,385 19,035 47,044 Other services and charges 99,355 99,355 116,038 (16,683) 105,994 Total culture and recreation 212,090 212,090 222,957 (10,867) 279,387 Total current 4,568,338 4,568,338 4,665,986 (97,648) 4,519,722 Capital outlay Culture and recreation - - 18,000 (18,000) 15,132 Total Expenditures 4,568,338 4,568,338 4,683,986 (115,648) 4,534,854 Excess (Deficiency) of Revenues Over (Under) Expenditures (209,573) (209,573) 54,518 264,091 (28,876) Other Financing Sources (Uses) Transfers in 213,573 213,573 213,573 - 208,110 Transfers out (4,000) (4,000) (404,000) (400,000) (53,362) Total Other Financing Sources (Uses)209,573 209,573 (190,427) (400,000) 154,748 Net Change in Fund Balances - - (135,909) (135,909) 125,872 Fund Balances, January 1 3,262,310 3,262,310 3,262,310 - 3,136,438 Fund Balances, December 31 3,262,310$ 3,262,310$ 3,126,401$ (135,909)$ 3,262,310$ 99 City of Medina, Minnesota Debt Service Funds Combining Balance Sheet December 31, 2019 312 313 316 319 G.O. Hunter South Hunter North G.O. Capital Improvement Improvement Improvement Improvement Bonds 2010A Bonds 2011A Bonds 2011B Bonds 2012A Assets Cash and temporary investments 39,397$ -$ 191,514$ 441,788$ Receivables Taxes 765 - 1,779 6,400 Special assessments 5,024 - - - Due from other governments 250 - 502 2,055 Total Assets 45,436$ -$ 193,795$ 450,243$ Deferred Inflows of Resources Unavailable revenue - taxes 765$ -$ 1,779$ 6,400$ Unavailable revenue - special assessments 5,024 - - - Total Deferred Inflows of Resources 5,789 - 1,779 6,400 Fund Balances Restricted for debt service 39,647 - 192,016 443,843 Total Deferred Inflows of Resources and Fund Balances 45,436$ -$ 193,795$ 450,243$ 100 320 321 322 323 324 G.O. Refunding G.O. Refunding G.O. G.O. Refunding G.O. Bonds Bonds Improvement Bonds Improvement 2012B 2013A Bonds 2015A 2016A Bonds 2017A Total 14,824$ 220,160$ 297,019$ 35,320$ 340,491$ 1,580,513$ - 3,453 1,891 - - 14,288 15,381 - 581,763 33,159 873,561 1,508,888 25 1,157 5,025 203 - 9,217 30,230$ 224,770$ 885,698$ 68,682$ 1,214,052$ 3,112,906$ -$ 3,453$ 1,891$ -$ -$ 14,288$ 15,381 - 581,763 33,159 873,561 1,508,888 15,381 3,453 583,654 33,159 873,561 1,523,176 14,849 221,317 302,044 35,523 340,491 1,589,730 30,230$ 224,770$ 885,698$ 68,682$ 1,214,052$ 3,112,906$ 101 City of Medina, Minnesota Debt Service Funds Combining Schedule of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2019 312 313 316 319 G.O. Hunter South Hunter North G.O. Capital Improvement Improvement Improvement Improvement Bonds 2010A Bonds 2011A Bonds 2011B Bonds 2012A Revenues Taxes 29,729$ 45$ 59,453$ 243,703$ Special assessments - - 1,052 - Interest on investments 607 1,839 4,793 8,042 Total Revenues 30,336 1,884 65,298 251,745 Expenditures Debt service Principal 25,000 20,000 90,000 175,000 Interest and other charges 2,724 3,270 13,409 114,991 Total Expenditures 27,724 23,270 103,409 289,991 Excess (Deficiency) of Revenues Over (Under) Expenditures 2,612 (21,386) (38,111) (38,246) Other Financing Sources Transfer in - - - 60,427 Net Change in Fund Balances 2,612 (21,386) (38,111) 22,181 Fund Balances, January 1 37,035 21,386 230,127 421,662 Fund Balances, December 31 39,647$ -$ 192,016$ 443,843$ 102 320 321 322 323 324 G.O. Refunding G.O. Refunding G.O. G.O. Refunding G.O. Bonds Bonds Improvement Bonds Improvement 2012B 2013A Bonds 2015A 2016A Bonds 2017A Total -$ 136,842$ 63,190$ -$ -$ 532,962$ 9,327 - 92,014 11,240 177,732 291,365 - 3,243 - - 7,735 26,259 9,327 140,085 155,204 11,240 185,467 850,586 80,000 145,000 120,000 165,000 - 820,000 3,915 13,665 38,278 22,629 25,466 238,347 83,915 158,665 158,278 187,629 25,466 1,058,347 (74,588) (18,580) (3,074) (176,389) 160,001 (207,761) 75,000 33,920 - 171,000 - 340,347 412 15,340 (3,074) (5,389) 160,001 132,586 14,437 205,977 305,118 40,912 180,490 1,457,144 14,849$ 221,317$ 302,044$ 35,523$ 340,491$ 1,589,730$ 103 City of Medina, Minnesota Summary Financial Report Revenues and Expenditures For General Operations Governmental Funds For the Years Ended December 31, 2019 and 2018 2019 2018 Revenues Taxes 4,602,747$ 4,368,247$ 5.4 % Licenses and permits 418,547 409,983 2.1 Intergovernmental 339,667 271,965 24.9 Charges for services 1,022,894 911,839 12.2 Fines and forfeitures 220,605 121,917 81.0 Special assessments 676,053 283,360 138.6 Interest on investments 431,793 153,109 182.0 Miscellaneous 817,780 322,500 153.6 Total Revenues 8,530,086$ 6,842,920$ 24.7 % Per Capita 1,283$ 1,080$ 18.8 % Expenditures Current General government 1,249,250$ 1,103,139$ 13.3 % Public safety 2,435,794 2,486,143 (2.0) Streets and highways 752,427 641,714 17.3 Sanitation and recycling 15,033 12,568 19.6 Culture and recreation 303,509 351,819 (13.7) Capital outlay General government 13,716 47,427 (71.1) Public safety 320,274 251,886 27.2 Streets and highways 928,067 886,421 4.7 Culture and recreation 81,631 291,359 (72.0) Economic development 190,872 196,255 (2.7) Debt service Principal 820,000 825,000 (0.6) Interest and other 238,347 251,246 (5.1) Total Expenditures 7,348,920$ 7,344,977$ 0.1 % Per Capita 1,106$ 1,159$ (4.6) % Total Long-term Indebtedness 9,880,000$ 10,700,000$ (7.7) % Per Capita 1,487 1,689 (12.0) General Fund Balance - December 31 3,126,401$ 3,262,310$ (4.2) % Per Capita 470 515 (8.7) The purpose of this report is to provide a summary of financial information concerning the City of Medina to interested citizens. The complete financial statements may be examined at City Hall, 2052 County Road 24, Medina, Minnesota 55340-9790. Questions about this report should be directed to the Finance Director at (763) 473-4643. Percent Increase (Decrease) Total 104 OTHER REQUIRED REPORT CITY OF MEDINA MEDINA, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2019 105 THIS PAGE IS LEFT BLANK INTENTIONALLY 106 INDEPENDENT AUDITOR’S REPORT ON MINNESOTA LEGAL COMPLIANCE Honorable Mayor and City Council City of Medina, Minnesota We have audited, in accordance with auditing standards generally accepted in the United States of America, the financial statements the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Medina, Minnesota (the City), as of and for the year ended December 31, 2019, and the related notes to the financial statements which collectively comprise the City’s basic financial statements, and have issued our report thereon dated May 12, 2020. In connection with our audit, nothing came to our attention that caused us to believe that the City of Medina failed to comply with the provisions of the contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous provisions, and tax increment financing sections of the Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor pursuant to Minn. Stat. § 6.65, insofar as they relate to accounting matters. However, our audit was not directed primarily toward obtaining knowledge of such noncompliance. Accordingly, had we performed additional procedures, other matters may have come to our attention regarding the City’s noncompliance with the above referenced provisions, insofar as they relate to accounting matters. This report is intended solely for the information and use of those charged with governance and management of the City of Medina and the State Auditor and is not intended to be, and should not be, used by anyone other than these specified parties. ABDO, EICK & MEYERS, LLP Minneapolis, Minnesota May 12, 2020 107 City of Medina 2019 Financial Statement Audit Introduction Audit Opinion and Responsibility General Fund Results Other Governmental Funds Enterprise Funds Key Performance Indicators 2 Audit Results Auditor’s Opinion Minnesota Legal Compliance 3 Audit Results 2019 Audit Findings •Adjustment related to capital asset infrastructure additions contributed by developers. Internal Control Finding -Material Audit Adjustment 4 General Fund Comparing Unassigned Fund Balance to Future Year Budget 50.9%50.3% 65.3%63.4%61.0% $4,119,507 $4,309,741 $4,426,643 $4,572,338 $4,807,123 50%50%50%50%50% $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 2015 2016 2017 2018 2019 2020 Unassigned Fund Balance Budget Minimum Fund Balance Policy 5 General Fund Budget to Actual Final Budgeted Actual Variance with Amounts Amounts Final Budget Revenues 4,358,765$ 4,738,504$ 379,739$ Expenditures 4,568,338 4,683,986 (115,648) Excess (Deficiency) of Revenues (209,573) 54,518 264,091 Over (Under) Expenditures Other Financing Sources (Uses) Transfers in 213,573 213,573 - Transfers out (4,000) (404,000) (400,000) Total Other Financing Sources (Uses)209,573 (190,427) (400,000) Net Change in Fund Balances - (135,909) (135,909) Fund Balances, January 1 3,262,310 3,262,310 - Fund Balances, December 31 3,262,310$ 3,126,401$ (135,909)$ 6 General Fund Revenues and Expenditures by Type $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 Taxes Intergovernmental Charges for Services Other 2017 2018 2019 $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 General Government Public Safety Streets and Highways Other 2017 2018 20197 Special Revenue Fund Balances $(200,000) $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 Restricted Committed Unassigned 2017 2018 2019 Increase 2019 2018 (Dec rease) Nonmajor Environmental 527,411$ 393,947$ 133,464$ Municipal Park 269,320 141,204 128,116 Field House 8,038 10,356 (2,318) Police Forfeiture 248,123 184,570 63,553 Police Reserve Equipment 17,939 17,686 253 German Liberal Cemetery 155,299 150,705 4,594 Community Event 18,865 2,455 16,410 Cable Franchise 21,347 (32,638) 53,985 Total 1,266,342$ 868,285$ 398,057$ December 31, Fund Balances Fund 8 Capital Projects Fund Balances $(1,000,000) $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 Restricted Committed Assigned Unassigned 2017 2018 2019 Increase 2019 2018 (Decrease) Major Sewer Capital Improvements 3,122,661$ 2,868,180$ 254,481$ Nonmajor Park Dedication 1,607,679 1,531,033 76,646 General Capital Improvement 317,969 130,420 187,549 Tax Increment 1-9 (117,998) (172,841) 54,843 Water Capital Improvements 1,483,661 1,109,138 374,523 Road Improvement 1,051,534 1,069,868 (18,334) Equipment Replacement 101,181 260,750 (159,569) Total Nonmajor 4,444,026 3,928,368 515,658 Total 7,566,687$ 6,796,548$ 770,139$ December 31, Fund Balances Fund 9 Debt Service Cash Total Bonds Maturity Balance Assets Outstanding Date 312 G.O. Improvement Bonds 2010A 39,397$ 45,436$ 60,000$ 2021 316 Hunter North Improvement Bonds 2011B 191,514 193,795 295,000 2022 319 G.O. Capital Improvement Bonds 2012A 441,788 450,243 5,235,000 2034 320 G.O. Refunding Bonds 2012B 14,824 30,230 175,000 2021 321 G.O. Refunding Bonds 2013A 220,160 224,770 615,000 2023 322 G.O Refunding Bonds 2015A 297,019 885,698 1,400,000 2024 323 G.O. Improvements Bonds 2016A 35,320 68,682 890,000 2024 324 G.O. Improvements Bonds 2017A 340,491 1,214,052 1,210,000 2031 Total 1,580,513$ 3,112,906$ 9,880,000$ Total Remaining Interest Payments 1,547,459$ Debt Description $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Principal Interest 10 Water Fund - Cash Flows from Operations and Cash Balances $2,052,731 $2,360,985 $2,520,309 $2,793,160 $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 2016 2017 2018 2019 Cash BalanceMinimum Target Balance (Following Year Debt Service Plus 6 Months of Operating Costs) $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 2016 2016 2017 2017 2018 2018 2019 2019 Operating Disbursements Debt Payments (Including Related Transfers)Operating Receipts 11 Sewer Fund - Cash Flows from Operations and Cash Balances $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2016 2016 2017 2017 2018 2018 2019 2019 Operating Disbursements Operating Receipts $1,885,856 $1,816,475 $1,658,824 $1,812,088 $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 $1,600,000 $1,800,000 $2,000,000 2016 2017 2018 2019 Cash Balance Minimum Target Balance (Following Year Debt Service Plus 6 Months of Operating Costs) 12 Storm Water Fund - Cash Flows from Operations and Cash Balances $- $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 2016 2016 2017 2017 2018 2018 2019 2019 Operating Disbursements Operating Receipts $380,008 $529,812 $368,391 $497,521 $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 2016 2017 2018 2019 Cash Balance Minimum Target Balance (Following Year Debt Service Plus 6 Months of Operating Costs) 13 Cash and Investments Balances by Fund Type $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 2017 2018 2019 General Fund Capital Projects Funds Special Revenue Funds Debt Service Funds Enterprise Funds 14 Key Performance Indicators 2016 2017 2018 2019 Class 4 Cities 59.1%59.8%58.5%N/A Cities in Hennepin County 43.5%43.7%41.9%N/A City of Medina 23.3%22.3%20.1%21.5% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% Tax Rates 15 Key Performance Indicators 2016 2017 2018 2019 Class 4 Cities $507 $524 $549 N/A Cities in Hennepin County $706 $727 $752 N/A City of Medina $715 $714 $696 $695 $- $100 $200 $300 $400 $500 $600 $700 $800 Taxes Per Capita 16 Key Performance Indicators 2016 2017 2018 2019 Class 4 Cities $2,860 $2,693 $2,697 N/A Cities in Hennepin County $2,094 $2,040 $1,942 N/A City of Medina $2,584 $2,289 $1,992 $1,685 $- $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 Debt Per Capita 2016 2017 2018 2019 Class 4 Cities 22.69%21.79%20.55%N/A Cities in Hennepin County 16.93%18.84%16.40%N/A City of Medina 17.51%20.79%18.98%18.20% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% Debt Service Expenditures as a Percent of Current Expenditures 17 Key Performance Indicators 2016 2017 2018 2019 Class 4 Cities 137%167%174%N/A Cities in Hennepin County 102%164%168%N/A City of Medina 118%119%81%92% 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 200% Water Fund Debt Service Coverage 18 Key Performance Indicators 2016 2017 2018 2019 Class 4 Cities $713 $730 $753 N/A Cities in Hennepin County $793 $809 $825 N/A City of Medina $824 $693 $690 $693 $- $100 $200 $300 $400 $500 $600 $700 $800 $900 Current Expenditures Per Capita 2016 2017 2018 2019 Class 4 Cities $377 $418 $400 N/A Cities in Hennepin County $338 $391 $336 N/A City of Medina $424 $195 $264 $231 $- $50 $100 $150 $200 $250 $300 $350 $400 $450 Capital Expenditures Per Capita 19 Questions? Audit Team Steve McDonald Justin Nilson Greta Pudas Erik Wagner Jill Knutson Tomi McDonald 20 City of Medina Medina, Minnesota For the Year Ended December 31, 2019 Management Communication Agenda Item # 7A May 12, 2020 Management, Honorable Mayor and City Council City of Medina, Minnesota We have audited the financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Medina, Minnesota (the City), for the year ended December 31, 2019. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated October 16, 2019. Professional standards also require that we communicate to you the following information related to our audit. Our Responsibility Under Auditing Standards Generally Accepted in the United States of America As stated in our engagement letter, our responsibility, as described by professional standards, is to express opinions about whether the financial statements prepared by management with your oversight are fairly presented, in all material respects, in conformity with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your responsibilities. Our responsibility is to plan and perform the audit to obtain reasonable, but not absolute, assurance that the financial statements are free of material misstatement. As part of our audit, we considered the internal control over financial reporting (internal control) of the City. Such considerations were solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures specifically to identify such matters. Significant Audit Findings In planning and performing our audit of the financial statements, we considered the District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. As described below, we identified a deficiency in internal control that we consider to be a material weakness, as finding 2019-001. 2 2019-001 Material Audit Adjustments Condition: During our audit, adjustments were needed to record capital asset additions for developer contributed infrastructure. Criteria: Such adjustments were needed to correct year end balances. Amounts reported in the District’s accounting system need to agree to the underlying supporting documentation. Cause: The City has not prepared a year-end trial balance reflecting all necessary accounting entries. Effect: This indicates that misstatements may occur and not be detected by the City’s system of internal control. Recommendation: We recommend management review the related journal entries, obtain an understanding of why the entries were necessary and modify current procedure to ensure that future corrections are not needed. Management Response: Management has reviewed the journal entry and implemented a process to ensure that this will not be recurring. Compliance As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we performed tests of compliance with certain provisions of Minnesota statutes. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. While our audit provides a reasonable basis for our opinion, it does not provide a legal determination on the City’s compliance with those requirements. We noted no instances of noncompliance with Minnesota statues. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the financial statements. The City changed accounting policies during the year related to accounting for fiduciary activities (GASB 84). We noted no transactions entered into by the governmental unit during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. 3 Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were related to estimated historical cost of the capital assets, depreciation on capital assets, evaluating a liability for other post-employment benefits, and the liability for the City’s pensions. • Management’s estimate of depreciation is based on estimated useful lives of the assets. Depreciation is calculated using the straight-line method. • Allocations of gross wages and payroll benefits are approved by City Council within the City’s budget and are derived from each employee’s estimated time to be spent servicing the respective functions of the City. These allocations are also used in allocating accrued compensated absences payable and other postemployment benefits. • Management’s estimate of its pension liability is based on several factors including, but not limited to, anticipated investment return rate, retirement age for active employees, life expectancy, salary increases and form of annuity payment upon retirement • Management’s estimate of its OPEB liability is based on several factors including, but not limited to, anticipated retirement age for active employees, life expectance, turnover, and healthcare cost trend rates. We evaluated key factors and assumptions used to develop these accounting estimates in determining that it is reasonable in relation to the financial statements taken as a whole. The disclosures in the financial statements are neutral, consistent, and clear. Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. We proposed one journal entry that we consider to be an audit entry or correction of management decisions. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated May 12, 2020. 4 Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Other Matters We applied certain limited procedures to the required supplementary information (RSI) (Management’s Discussion and Analysis, the Schedules of Employer’s Share of the Net Pension Liability, the Schedules of Employer’s Contributions, Schedule of changes in the City's OPEB Liability and Related Ratios), which is information that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI. We were engaged to report on the supplementary information (combining and individual fund financial statements and schedules, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We were not engaged to report on the introductory section, which accompany the financial statements but is not RSI. We did not audit or perform other procedures on this other information, and we do not express an opinion or provide any assurance on it. 5 Future Accounting Standard Changes The following Governmental Accounting Standards Board (GASB) Statements have been issued and may have an impact on future City financial statements: (1) GASB Statement No. 87 - Leases Summary The objective of this Statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This Statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. Effective Date and Transition The requirements of this Statement are effective for reporting periods beginning after December 15, 2019. Earlier application is encouraged. Leases should be recognized and measured using the facts and circumstances that exist at the beginning of the period of implementation (or, if applied to earlier periods, the beginning of the earliest period restated). However, lessors should not restate the assets underlying their existing sales-type or direct financing leases. Any residual assets for those leases become the carrying values of the underlying assets. How the Changes in This Statement Will Improve Accounting and Financial Reporting This Statement will increase the usefulness of governments’ financial statements by requiring reporting of certain lease liabilities that currently are not reported. It will enhance comparability of financial statements among governments by requiring lessees and lessors to report leases under a single model. This Statement also will enhance the decision- usefulness of the information provided to financial statement users by requiring notes to financial statements related to the timing, significance, and purpose of a government’s leasing arrangements. GASB Statement No. 89 - Accounting for Interest Cost Incurred before the End of a Construction Period Summary The objectives of this Statement are (1) to enhance the relevance and comparability of information about capital assets and the cost of borrowing for a reporting period and (2) to simplify accounting for interest cost incurred before the end of a construction period. This Statement establishes accounting requirements for interest cost incurred before the end of a construction period. Such interest cost includes all interest that previously was accounted for in accordance with the requirements of paragraphs 5–22 of Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre- November 30, 1989 FASB and AICPA Pronouncements, which are superseded by this Statement. This Statement requires that interest cost incurred before the end of a construction period be recognized as an expense in the period in which the cost is incurred for financial statements prepared using the economic resources measurement focus. As a result, interest cost incurred before the end of a construction period will not be included in the historical cost of a capital asset reported in a business-type activity or enterprise fund. This Statement also reiterates that in financial statements prepared using the current financial resources measurement focus, interest cost incurred before the end of a construction period should be recognized as an expenditure on a basis consistent with governmental fund accounting principles. 6 Future Accounting Standard Changes (Continued) Effective Date and Transition The requirements of this Statement are effective for reporting periods beginning after December 15, 2019. Earlier application is encouraged. The requirements of this Statement should be applied prospectively. How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will improve financial reporting by providing users of financial statements with more relevant information about capital assets and the cost of borrowing for a reporting period. The resulting information also will enhance the comparability of information about capital assets and the cost of borrowing for a reporting period for both governmental activities and business-type activities. GASB Statement No. 91 - Conduit Debt Obligations Summary The primary objectives of this Statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. This Statement achieves those objectives by clarifying the existing definition of a conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of additional commitments and voluntary commitments extended by issuers and arrangements associated with conduit debt obligations; and improving required note disclosures. All conduit debt obligations involve the issuer making a limited commitment. Some issuers extend additional commitments or voluntary commitments to support debt service in the event the third party is, or will be, unable to do so. An issuer should not recognize a conduit debt obligation as a liability. However, an issuer should recognize a liability associated with an additional commitment or a voluntary commitment to support debt service if certain recognition criteria are met. As long as a conduit debt obligation is outstanding, an issuer that has made an additional commitment should evaluate at least annually whether those criteria are met. An issuer that has made only a limited commitment should evaluate whether those criteria are met when an event occurs that causes the issuer to reevaluate its willingness or ability to support the obligor’s debt service through a voluntary commitment. This Statement also addresses arrangements - often characterized as leases - that are associated with conduit debt obligations. In those arrangements, capital assets are constructed or acquired with the proceeds of a conduit debt obligation and used by third-party obligors in the course of their activities. Payments from third-party obligors are intended to cover and coincide with debt service payments. During those arrangements, issuers retain the titles to the capital assets. Those titles may or may not pass to the obligors at the end of the arrangements. This Statement requires issuers to disclose general information about their conduit debt obligations, organized by type of commitment, including the aggregate outstanding principal amount of the issuers’ conduit debt obligations and a description of each type of commitment. Issuers that recognize liabilities related to supporting the debt service of conduit debt obligations also should disclose information about the amount recognized and how the liabilities changed during the reporting period. Effective Date and Transition The requirements of this Statement are effective for reporting periods beginning after December 15, 2020. Earlier application is encouraged. 7 Future Accounting Standard Changes (Continued) How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will improve financial reporting by eliminating the existing option for issuers to report conduit debt obligations as their own liabilities, thereby ending significant diversity in practice. The clarified definition will resolve stakeholders’ uncertainty as to whether a given financing is, in fact, a conduit debt obligation. Requiring issuers to recognize liabilities associated with additional commitments extended by issuers and to recognize assets and deferred inflows of resources related to certain arrangements associated with conduit debt obligations also will eliminate diversity, thereby improving comparability in reporting by issuers. Revised disclosure requirements will provide financial statement users with better information regarding the commitments issuers extend and the likelihood that they will fulfill those commitments. That information will inform users of the potential impact of such commitments on the financial resources of issuers and help users assess issuers’ roles in conduit debt obligations. (1) Note. From GASB Pronouncements Summaries. Copyright 2019 by the Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, USA, and is reproduced with permission. * * * * * Restriction on Use This communication is intended solely for the information and use of the City Council, management, others within the City and the Minnesota Office of the State Auditor and is not intended to be and should not be used by anyone other than these specified parties. The comments and recommendation in this report are purely constructive in nature, and should be read in this context. Our audit would not necessarily disclose all weaknesses in the system because it was based on selected tests of the accounting records and related data. If you have any questions or wish to discuss any of the items contained in this letter, please feel free to contact us at your convenience. We wish to thank you for the continued opportunity to be of service, and for the courtesy and cooperation extended to us by your staff. ABDO, EICK & MEYERS, LLP Minneapolis, Minnesota May 12, 2020 8 MEMORANDUM TO: City Council, through City Administrator Scott Johnson FROM: Jim Stremel, City Engineer DATE: May 14, 2020 MEETING: May 19, 2020 SUBJECT: Tamarack Drive Corridor/Visioning Study – Concept Review & Update Background: The City’s 2040 Comprehensive Plan anticipates residential, institutional, and commercial growth within the Tamarack Drive corridor. The study corridor is located from Hamel Road to the south up to Meander Road to the north. There has been development interest on the north side of Trunk Highway (TH) 55, and on the south side of TH 55 where the Wayzata School District recently purchased property. Although no specific plans are underway for construction of a school on this site, staff believes it is appropriate to anticipate the potential after 2025, when the property is staged for development. It is anticipated that the development along the corridor will likely be completed by multiple parties at different times. The Tamarack Drive Visioning Study was initiated to develop a cohesive plan that can be provided to property owners and developers guiding the transportation needs, right-of-way, public utilities, access points/spacing, pedestrian mobility, and other parameters adjacent to their properties within the Tamarack Drive corridor. The Study will provide a guide to the City for the following as development occurs: 1. Requiring right-of-way to allow construction of the improvements 2. Require construction of portions of the roadway as part of the required improvements by adjacent developments. 3. Provide a framework for securing financial contributions for certain portions of the roadway which benefit all of the adjacent developments and may not be able to be constructed until a future time. The intent of this memo is to provide an update to the City Council as to what has been completed to date with the study including traffic forecasting/analysis, traffic operations review, concept plan development, public engagement, and coordination with stakeholders. City staff and the engineering team are asking for City Council comments, questions, and direction in development of the vision and preparation of the final study report. Existing Conditions: Currently, there is no connection between TH 55 and Meander Road or between TH 55 and Hamel Road. A prescriptive easement does exist for the current unmaintained roadway south of TH 55, but not to the north. The proposed roadway corridor is a combination of agricultural land, floodplains, and wetlands. There is no existing paved (improved) roadway or city utilities within the proposed corridor. There is an access off of TH 55 in both the north and south directions including eastbound Agenda Item # 8A 2 and westbound turn lanes. Just to the south of TH 55, CP Railroad owns and operates a single track and a narrow crossing exists. Traffic Forecasting Analysis: Traffic forecasts were prepared for the twenty-year design (year 2040) condition, representing the full development of the area using the land uses in the City’s 2040 Comprehensive Plan. The traffic forecasts were prepared by adding the projected annual background traffic growth and anticipated area development site traffic generation to determine the 2040 Build traffic conditions in and around the immediate area. The estimated existing and projected 2040 traffic volumes are listed below: Location Existing ADT Projected 2040 ADT Tamarack Drive south of Meander Road NA 1,750 Tamarack Drive north of TH 55 NA 8,300 Tamarack Drive south of TH 55 NA 3,300 Tamarack Drive north of Hamel Road NA 1,000 TH 55 west of Arrowhead Drive 16,600 22,300 TH 55 west of future Tamarack Drive 18,800 24,800 TH 55 west of Pinto Drive (CSAH 116) 18,800 27,200 TH 55 east of Pinto Drive (CSAH 116) 25,000 33,500 Meander Road east of Arrowhead Drive 400 1,200 Meander Road west of Pinto Drive (CSAH 116) 900 2,200 Arrowhead Drive north of Meander Road 1,050 7,100 Arrowhead Drive south of TH 55 2,200 2,500 Pinto Drive (CSAH 116) north of Meander Road 9,600 12,200 Pinto Drive (CSAH 116) north of TH 55 9,600 11,000 Pinto Drive (CSAH 116) south of TH 55 2,200 2,600 Hamel Road east of Arrowhead Drive 1,200 1,400 Hamel Road west of Pinto Drive (CSAH 116) 1,600 2,100 3 Traffic Operations Analysis: Tamarack Drive has been identified by the City of Medina as a future Collector roadway between Meander Road and Hamel Road that would provide access to the development area north and south of TH 55. The access of Tamarack Drive at TH 55 is included in the MnDOT Access Management Guidelines as a future full movement signalized intersection. In addition, left and right turn lanes are currently provided for both eastbound and westbound TH 55 at the future Tamarack Drive intersection. The City has been guiding development of the areas adjacent to TH 55 based on the current City 2040 Comprehensive Plan assuming a full movement signalized access on TH 55 at Tamarack Drive. However, in order to verify the need for this access, two roadway access alternatives were included as part of this analysis including: 1. A full movement signalized intersection with northbound and southbound left and right turn lanes, and; 2. A partial access, right-in/right-out stop-controlled intersection with northbound and southbound right turn lanes. The traffic analysis evaluated the operations for the existing and projected 2040 conditions at the impacted area intersections with the proposed Tamarack Drive corridor improvements. The following table shows the level of service comparison of the existing and 2040 build conditions with both access alternatives. Co n t r o l Intersection Existing Projected 2040 Full Access Projected 2040 Right-in/Right-out AM Peak Hour PM Peak Hour AM Peak Hour PM Peak Hour AM Peak Hour PM Peak Hour Si g n a l TH 55 at Arrowhead Dr D (E) C (E) E (F) D (E) F (F) E (F) Si g n a l TH 55 at Pinto Dr (CSAH 116) E (F) D (E) F (F) F (F) F (F) F (F) Th r u - St o p Meander Rd at Arrowhead Dr A (A) A (A) A (A) A (A) A (B) A (B) Th r u - St o p Meander Rd at Pinto Dr (CSAH 116) A (F) A (C) F (F) A (F) F (F) C (F) Th r u - St o p Hamel Rd (CSAH 115 at Arrowhead Dr A (A) A (A) A (A) A (A) A (A) A (A) Th r u - St o p Hamel Rd (CSAH 115) at Pinto Dr (CSAH 116) A (A) A (A) A (B) A (A) A (B) A (B) Th r u - St o p Meander Rd at Development Access NA NA A (A) A (A) A (A) A (A) Th r u - St o p Meander Rd at Tamarack Dr NA NA A (A) A (A) A (A) A (A) Th r u - St o p Tamarack Dr at Development Access NA NA A (B) A (B) A (A) A (B) 4 Si g n a l TH 55 at Tamarack Dr NA NA D (E) D (E) C (E) C (E) Th r u - St o p Hamel Rd at Tamarack Dr NA NA B (C) A (A) C (D) A (A) C = Overall LOS, (D) = Worst movement LOS Source: WSB & Associates, Inc Based on the analysis conducted, WSB has concluded the following: • The City of Medina identified the need to prepare a preliminary plan and vision for the future Tamarack Drive corridor from Meander Road to Hamel Road (CSAH 115). The corridor has been included in the City’s 2040 Comprehensive Plan. • The access to TH 55 at Tamarack Drive is included in the MnDOT Access Management Guidelines. In addition, MnDOT completed a preliminary corridor design concept for TH 55 from I-494 to the Crow River in 2007 and an EA/EAW in 2008. These documents both identified a future controlled intersection access at the TH 55 and Tamarack Drive. • The areas north and south of TH 55 adjacent to the future Tamarack Drive corridor is planned for commercial and residential development north of TH 55 and could potentially be developed for Wayzata School District use south of TH 55. • The future area development is anticipated to generate up to 10,307 daily, 752 AM peak hour and 1,030 PM peak hour trips north of TH 55 and; 3,079 daily, 955 AM peak hour and 260 PM peak hour trips south of TH 55. • Two roadway access alternatives were prepared and analyzed including: a full movement signalized intersection with northbound and southbound left and right turn lanes, and; a partial access, right-in/right-out stop-controlled intersection with northbound and southbound right turn lanes. • Based on comparison of the two access alternatives, the right-in/right-out access alternative would divert traffic to the adjacent roadways and would have significant traffic operation impacts specifically at the adjacent intersections of: TH 55 at Arrowhead Drive; TH 55 at Pinto Drive (CSAH 116), and; Pinto Drive (CSAH 116) at Meander Road. In addition, there is a safety concern with vehicles turning out from Tamarack Drive merging with vehicles on TH 55 traveling at 55mph. Based on these conclusions the following is recommended. 1. Provide a full movement intersection at TH 55 and Tamarack Drive to provide access to the existing and future development area north and south of TH 55, as identified by the City of Medina and in the current MnDOT Access Management Guidelines for the TH 55 corridor. 2. The construction of Tamarack Drive including the full movement access connection to TH 55 should be completed as development continues to occur in the area north of TH 55. It is recommended that should Meander Road reach a level of 3,100vpd, which would be a level 5 to warrant a traffic signal at the Meander Road and Pinto Drive (CSAH 116) intersection, the connection to TH 55 should be completed. Assuming the existing traffic volume on Meander Road (900vph) with the full development of the Meadow View Townhomes (1,010vpd), a portion of the commercial development (1,190vpd) or approximately 12% of the development could be completed prior to the need for the construction of Tamarack Drive. 3. As the area adjacent to TH 55 and Tamarack Drive is developed, continue to review the warrants for installation of a traffic signal system at the intersection. When warrants are met work with MnDOT for approval and construction of the traffic signal system. Based on review of the Minnesota Manual on Uniform Traffic Control (MnMUTCD) traffic signal warrants, it is estimated that the required traffic volume currently exist on TH 55 (>15,000vpd) to warrant a traffic control signal system, however, it is anticipated that approximately 35% of the development on the north side of TH 55 or the school development on the south side of TH 55 or a combination of both (>3,100vpd) would need to be completed to warrant the traffic signal system. 4. As traffic grows in the area work with MnDOT and Hennepin County on possible improvements at the intersections of TH 55 at Arrowhead Drive; TH 55 at Pinto Drive (CSAH 116), and; Pinto Drive (CSAH 116) at Meander Road to improve future traffic operations Public Engagement & Concept Plan Development: In order to gather input and engage the public on a vision for the Tamarack Drive corridor, City Staff prepared a survey, mapping activity (currently underway), and held an open house. Initially, when the scope of the project was prepared, and in-person open house was proposed to engage the pubic on this project. Due to the current COVID-19 pandemic and to respect the CDC guidelines limiting public gatherings, the public engagement strategy needed to be in a virtual format that did not require direct in-person contact. With that challenge at hand, the City ultimately decided to use Social Pinpoint, an online public engagement platform that where surveys and a mapping interface can be developed. Here is a summary of the virtual public engagement activities utilized for this study, which generally focused on the portion of the corridor north of TH 55. • A survey was developed asking for input on various hard-scape design elements and street sections that would be feasibility in the corridor. These included a center median (parkway) street section, typical undivided street section, round-about/traditional intersection designs, landscaping ideas, and pedestrian access options. Those who participated were able to vote on these various options and provide other input on the “ideas wall”. Enclosed with this memo are the survey results and comments placed on the ideas wall. • A virtual open house through a webinar platform was held on April 14, 2020 that included general information on the corridor and study elements, a commercial site analysis/mapping, review comments provided on the initial online survey, and live resident feedback (voice calls and written questions) from residents during the meeting. The intent was to mimic what would normally have been available at an in-person meeting. 6 • Based on the initial survey results and the virtual open house, two final concepts were created (Concepts A & B) utilizing both a parkway roadway design and a traditional undivided roadway section with various commercial site alternatives. The concepts are currently posted on Social Pinpoint and open for comments until May 28th. Staff believe the best way for the Council to review the feedback is to visit the site here: https://wsb.mysocialpinpoint.com/tamarackdrive WSB’s Land Development team also analyzed the commercial areas north of TH 55 for potential site layouts and access points to the proposed Tamarack Drive extension. This included a site-fit analysis to maximize potential commercial uses with current City ordinance guidelines for setbacks, parking areas. The uses considered included a convenience store/gas station, hotel, single/multi-tenant retail, and a single tenant retail (with loading dock), with various access options to both Tamarack Drive and at Meander Road. These concepts were included with the virtual open house presentation and integrated into the final concepts for the current Social Pinpoint mapping activity (Concepts A & B). Based on the traffic forecasting and analysis, a concept plan for the entire corridor was prepared that includes geometric improvements, preliminary intersection control design (stop condition or roundabout), signal improvements at TH 55, and right-of-way needs. The street section considered for each of the concepts includes a divided roadway/parkway design with both sidewalks and multi- use trails. Enclosed is a draft concept for review and comment. Next Steps: Based on City Council input and direction, WSB will proceed with further geometric refinement, prepare right-of-way files and linework (available for developers), include a water/sewer utility review, finalize the feasibility study for the signalized intersection and related improvements, and complete a more refined cost estimating of the preferred option. A final report is planned to be brought forth at the June 16th Council Meeting. Results of the final public engagement activity will also be available at that time. City Council Action Requested: Staff requests input and direction from the City Council on a preferred option and consider an endorsement of the need for a signal at TH 55. After review, the Council can consider the following actions: 1. Motion to proceed with Concept # as the preferred option, including a full access with signal at Highway 55. 2. Motion to direct staff to take actions necessary to secure approval from relevant agencies for the access at Highway 55 and to complete the Tamarack Drive Study. 1 Tamarack Drive Corridor Visioning Study: Social Pinpoint Activity Results Survey (22 responses as of 04/21/20) Section 1: Example Roadways Ranking 1 = most preferred choice, 6 = least preferred choice Summary Votes for Each Rank by Example Rank Example 1 Example 2 Example 3 Example 4 Example 5 Example 6 1 6 0 12 1 1 2 2 2 3 5 0 9 2 3 4 3 1 5 3 4 4 0 5 3 5 4 3 5 3 4 0 7 3 2 6 5 5 0 2 0 7 6 0 12 1 1 22 3 5 0 9 2 4 3 1 5 3 4 0 5 3 5 4 33 4 0 7 3 2 5 5 0 2 0 7 0 2 4 6 8 10 12 14 Example 1 Example 2 Example 3 Example 4 Example 5 Example 6 Ranking Distribution Overview 1 2 3 4 5 6 2 Example 1 6 2 4 0 3 5 0 1 2 3 4 5 6 7 1 2 3 4 5 6 Example 1 Ranking Distribution 3 Example 2 0 3 3 5 4 5 0 1 2 3 4 5 6 1 2 3 4 5 6 Example 2 Ranking Distribution 4 Example 3 12 5 1 3 0 0 0 2 4 6 8 10 12 14 1 2 3 4 5 6 Example 3 Ranking Distribution 5 Example 4 1 0 5 5 7 2 0 1 2 3 4 5 6 7 8 1 2 3 4 5 6 Example 4 Ranking Distribution 6 Example 5 1 9 3 4 3 0 0 1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 Example 5 Ranking Distribution 7 Example 6 2 2 4 3 2 7 0 1 2 3 4 5 6 7 8 1 2 3 4 5 6 Example 6 Ranking Distribution 8 Section 2: Roadway Features Summary Yes Votes by Feature Feature Yes Votes Percent Trees/Vegetation 18 82% Sidewalks and/or Trails 18 82% Grass or Landscaped Median 14 64% Decorative Lighting 13 59% Roundabout 5 23% Bump-Out (Curb Extension) 2 9% Concrete Median 2 9% Sidewalks and/or Trails Yes, this feature fits my vision for Tamarack Drive: 18/22 (82%) Comments: · Trails will be nice. Combination of this with natural landscaped median. · Trails are a good idea. · It would be nice to extend the trails in the area along both sides of Tamarack Drive. · Trail/sidewalk is great for families and kids to be able to walk and bike the area · Making the neighborhoods connected with bike trails wold be ideal. · Walking, jogging and biking trail · Trails or wide sidewalks are a must. Lots of pedestrians in high residential areas and for commercial business. · Adding trails is always positive in my opinion. 2 2 5 13 14 18 18 0 5 10 15 20 Concrete Median Bump-Out (Curb Extension) Roundabout Decorative Lighting Grass or Landscaped Median Sidewalks and/or Trails Trees/Vegetation Number of Yes Votes 9 Trees/Vegetation Yes, this feature fits my vision for Tamarack Drive: 18/22 (82%) Comments: · This would be an ideal scenario. · I prefer trees and vegetation. · The more trees/vegetation the better as far as I'm concerned. · We need WAY MORE TREES in Medina so that along with other vegetation, that gets manicured and taken care of would be great to see. · Mature trees and beautiful flowers like hanging baskets... · Whether trees/bushes are located on street sides or the median, they fit that location of Medina well and make it a greener more luxurious look than just roadway. Grass or Landscaped Median Yes, this feature fits my vision for Tamarack Drive: 14/22 (64%) Comments: · Aesthetically pleasing. · Landscaped is nice. Grass, if not maintained, will be aesthetically unappealing. · I like the look of landscaped medians. · Would prefer this over concrete median, but a median is needed. · Landscaping will be key to make this look upscale and nice. Decorative Lighting Yes, this feature fits my vision for Tamarack Drive: 13/22 (59%) Comments: · Optional - but not necessary. · I would prefer to not have any additional lights/streetlights added. · I like the idea of decorative lighting as long as it doesn't increase the overall light pollution near residences. Would be nice along trails for safety in the evening, but it does have a more commercial/retail feel to me. · We don't have enough lighting in general in our current neighborhood in the Fields of Medina on Jubert Trail. Also on Meander there is hardly any lighting. For community safety I would like to see more lighting in general. · Well lit roads to take safe evening walks. · I'm not in favor of adding light pollution to our neighborhood. Roundabout Yes, this feature fits my vision for Tamarack Drive: 5/22 (23%) Comments: · Just doesn't feel right for the area. · No roundabout, too much road, not necessary for this plan and future road. 10 Concrete Median Yes, this feature fits my vision for Tamarack Drive: 2/22 (9%) Comments: · Maintenance issues with this. Not ideal or sustainable long term. · I don't like concrete. · I prefer landscaped medians to concrete. · concrete is so ugly and does not provide an upscale look · One of the reasons I love living in Medina is because of the wildlife and natural beauty. I don't believe that a concrete median would be consistent with the current landscape. Bump-out (Curb Extension) Yes, this feature fits my vision for Tamarack Drive: 2/22 (9%) Comments: · I would not want to encourage parking along Tamarack Drive. I think there should be other, dedicated parking areas. · I think that will slow traffic which will be great. Traffic on Meander drives WAY too fast. Other Features (What other features would you like to see that were not included in the examples above?) Comments: · I think that the combination of the trails with natural landscaping is an ideal scenario. · A stop light at 55/Tamarak is critical to manage egress and release pressure on the meander/116/arrowhead egress that will come from future development · Please ensure Tamarack and ideally, Arrowhead becomes whistle free crossings for train track parallel to 55. Thank you! The whistle free crossings create a better environment for families to enjoy the growing neighborhoods, the ability to play outside without interruption and sleep with windows open. · Would like to see Many Tall evergreens planted on the North side of Meander to separate the Fields of Medina Neighborhood to what will be the newly developed space. · benches, small grass areas for walking, sitting. · I live in the Fields of Medina - West neighborhood, and my biggest concern is the volume and speed of cars on Meander road. Because of how the road straightens out, cars often exceed the 40 mph speed limit, which makes me nervous to have my children playing in the back yard. Thank you for consulting the community for this project! 11 Ideas Wall (14 comments as of 04/21/20) Within each comment type, responses are sorted from most likes to least. Things I would like to see (7 comments) 1. If townhomes are built the city should leverage Meander Rd for an outlet to both 116 and Arrowhead. Meander can be expanded with a median to 4 lanes. No railroad crossing req. There will be minimal traffic northbound to Hamel Rd. We’ve been told by Medina city officials numerous times that the county will not allow an intersection with a light at Mohawk and now somehow it is appropriate to add another intersection and a light on hwy 55. I can’t see any logic or rationale with this decision. [5 Likes, 3 Dislikes] 2. We need to very mindful of walkable areas from Meander onto 116. This walkway does not go through and is very dangerous - especially for those turning right from the southbound lane. We need to be able to mitigate future issues that limit sight lines for those that walk this route. From my standpoint, we cannot move forward with this project until we address the potential density issues that will impact this area. [3 Likes, 0 Dislikes] 3. Need to have a traffic light at 116/meander and/or tamarack/55. Currently it's very dangerous making a left or right turn off of meander to 116. Meander can't support additional traffic from this new development at this intersection without a light. [3 Likes, 0 Dislikes] 4. Please consider traffic and safety along all of Meander Road with the addition of this proposed neighborhood and new road. There is significant pedestrian traffic from the current residential areas along Meander and traffic controls such as roundabouts at the existing roads of Jubert Dr and Cavanaugh Dr as well as the proposed intersection of Tamarak could assist with slowing traffic and keeping families safe [2 Likes, 0 Dislikes] 5. If we do need to better link parts of Medina north and south of Hwy 55, could we add a bike and pedestrian tunnel or tasteful access bridge? Always concerning seeing people try to cross the Hwy & hoping drivers follow the traffic lights. Would be nice for the retail and restaurant space to have a very walkable almost park like feel with benches, landscape, fountains, etc. that encourage community vs. a typical strip mall. Adding the biking & pedestrian access could help encourage that vibe. [1 Likes, 0 Dislikes] 6. *If increasing residential density, will need a plan to mitigate light pollution. *A nice to have for the residents in the area would be an off leash dog park. *Meander Road will need to be expanded into a total of 4 lanes (2 lanes in each direction) to accommodate traffic, with a median in between. *And please refrain from using any roundabouts! *When evaluating restaurant ideas, prioritize local eateries/breweries and fast casual (like Chipotle and Punch Pizza). [1 Likes, 0 Dislikes] 7. first choice would be to see an upscale retail / restaurant development use the entire space to compliment an upscale community like Medina. Using the entire space would allow ample room to keep a country like feeling and draw people from neighboring cities. 12 Second choice would be to move the proposed neighborhood to Meander and Arrowhead where they would already have access to 2 exits eliminating the additional traffic on Meander. [0 Likes, 0 Dislikes] Things I would not like to see (4 comments) 1. I fail to see how 138 new townhomes, an additional traffic restricting light on hwy 55 and a new railroad crossing aligns with the council’s stated mission statement; “Keep Medina Rural”. Perhaps a business park with small retail shops, restaurants and coffee shops, and maybe a soccer pitch accessible via Meander Rd to 116 and Arrowhead would be less invasive and serve the neighborhoods in the area better without further restricting traffic on hwy 55. [9 Likes, 2 Dislikes] 2. Agree with all other comments. This proposed neighborhood and new road do not make sense in this location. This does not fall in line at all with the vision of Medina and why residents move here. If you need to bring down the average home price in Medina, please don't do it at the expense of other residents. There is PLENTY of space in Medina to add a massive townhouse development that would not be adjacent to an another established neighborhood. Put this development on the other side of 55 [2 Likes, 0 Dislikes] 3. I have concerns that the existing park that already accommodates, both East and West Fields of Medina, Bridgewater and the Foxberry neighborhoods would not be large enough to accommodate another 100+ homes. [0 Likes, 0 Dislikes] 4. For safety reason's I would not want a hotel overlooking the park. [0 Likes, 0 Dislikes] Other comments (3 comments) 1. It would be nice to get public comments on if adding another through road across 55 is the correct design plan vs. just the aesthetics; which I imagine to be ignored regardless. I totally understand new access points to the proposed development area will need to be created off of 55, but I don’t understand why it’s seen as necessary for it to go all the way through to Meander or across the highway to connect to Hamel road. Agreed with another poster that a light at Meander/116 would be better. [6 Likes, 0 Dislikes] 2. If Medina is committed to keeping a rural feeling, they should take a hard look at allowing 130 plus town homes and determine if that really fits the vision of Medina. One of the most attractive qualities of this area is Wayzata schools without the congesting and constant building like Plymouth. What does this mean for our schools that are already filled to the max? Will this result in redistricting yet again? I think this is a slippery slope. [5 Likes, 0 Dislikes] 3. As Medina expands the neighborhoods near Pinto and Arrowhead, it would be ideal to ensure Tamarack and Arrowhead become whistle free train intersections. To enjoy the peace of the countryside and allow residents to sleep with windows open - whistle free train intersections are a must as Medina expands developments. [3 Likes, 0 Dislikes] C: \ U s e r s \ e k e l l y \ D o c u m e n t s \ P R O J E C T _ M e d i n a \ 0 1 5 5 9 9 C o m m e r c i a l C o n c e p t s 0 4 2 9 2 0 Tamarack Drive Study - Commercial Area Concepts Tamarack Drive Study - Medina, Minnesota April 29, 2020 | WSB Project number: 015599-000 Concept A Concept B Scale in Feet 800’0’200’400’North Scale in Feet 800’0’200’400’North WET WE T W E T WE TWE T WET WE T W E T WE T WET WET WE T WE T WE T WE T WE T WE T WET WET W E T WET WE T W E T WE TWE T WET WE T W E T WE T WET WET WE T WE T WE T WE T WE T WE T WET WET W E T FUTURE MEDIUM DENSITY RESIDENTIAL FUTURE MEDIUM DENSITY RESIDENTIAL Undivided Roadway Section - 66’ R.O.W.Parkway Section - 80’ R.O.W. Tamarack Drive - Undivided Road Tamarack Drive - Parkway Alternate Intersection at Commercial Entrance Alternate Intersection at Commercial Entrance Note: Commercial uses are illustrative only to show context for potential street orientations. LEGEND PROPOSEDTAMARACK DR ALIGNMENT COMMERCIAL OR RETAIL DEVELOPMENT LANDSCAPESCREENING STORMWATERMANAGEMENT AREA FRONTAGEROAD DRIVEWAY ACCESS TO COMMERCIAL SIGNALIZED INTERSECTION ROUNDABOUT RESIDENTIAL DEVELOPMENT wetland wetland wetland wetland wetland wetland RETAIL 3.0 ac. +/- COM M E R C I A L 3.0 acr e s + / - HIGH W A Y 5 5 HIGH W A Y 5 5 MEANDER ROAD RETAIL 2.3 ac. +/- RETAIL 1.5 ac. +/- RETAIL 3.0 ac. +/- COMMERCIAL 2.5 ac. +/-COMMERCIAL 5.5 ac. +/- City Park Fields of Medina City Park Fields of Medina COMMERCIAL 5.0 ac.+/- CO M M E R C I A L 1. 8 a c . + / - MEANDER ROAD stormwater management Paved Trail Paved Trail MedianSidewalkSidewalk TA M A R A C K D R TA M A R A C K D R TA M A R A C K D R COM M E R C I A L 3.0 acr e s + / - RETAIL 1.0 ac. RETAIL 1.0 ac. RETAIL 2.0 ac. RETAIL 3.0 ac.+/- RETAIL 4.0 ac.+/- RETAIL 2.5 ac.+/- RETAIL 3.0 ac.+/- COMMERCIAL 8.0 ac.+/- COMMERCIAL 4.0 ac.+/- TA M A R A C K D R stormwater management W S B F i l e n a m e : D a t e : P r i n t e d : 5 / 1 4 / 2 0 2 0 K : \ 0 1 5 5 9 9 - 0 0 0 \ C a d \ La y o u t \ 0 1 5 5 9 9 - 0 0 0 _ l o . d g n City of Medina May 2020 Tamarack Drive Corridor Study REQUIREMENTS PLANS AND SIGHT DISTANCE BASED ON DEVELOPMENT ROAD INTERSECTION WILL BE FINAL LOCATION OF HAMEL BASE ON DEVELOPMENT ACCESS TO BE DETERMINED EXACT ALIGNMENT AND Legend ROADWAY SHOULDERS (PAVED) CURB SIDEWALK INPLACE SIGNAL PROPOSED SIGNAL DELINEATED WETLAND EXISTING R/W PROPOSED R/W S TO P ROUNDABOUT OPTION S TO P STOP STOP N 0 SCALE IN FEET 150 300 Figure X Proposed Roadway Geometics and Alignments S TO P EXISTING ADT PROJECTED 2040 ADT XXX (XXX) MINNESOTA 55 M e a n d e r R o a d H a m el R o a d 400 (1800) 900 (2200) 1200 (1400) 18,800 (24,800) 0 (1000) 0 (3300) 0 (8300) 0 (1750) 18,800 (27,200) 1600 (2100) Rural Street Section Urban Undivided Street Section - 66' ROW Urban Divided (Parkway) Street Section - 80' ROW S M T W T F S S M T W T F S 1 2 3 4 1 2 3 4 5 6 7 8 9 10 11 5 6 7 8 9 10 11 12 13 14 15 16 17 18 12 13 14 15 16 17 18 19 20 21 22 23 24 25 19 20 21 22 23 24 25 26 27 28 29 30 31 26 27 28 29 30 31 1 S M T W T F S S M T W T F S 1 2 3 4 5 6 7 8 2 3 4 5 6 7 8 9 10 11 12 13 14 15 9 10 11 12 13 14 15 16 17 18 19 20 21 22 16 17 18 19 20 21 22 23 24 25 26 27 28 29 23 24 25 26 27 28 29 30 31 S M T W T F S S M T W T F S 1 2 3 4 5 6 7 1 2 3 4 5 8 9 10 11 12 13 14 6 7 8 9 10 11 12 15 16 17 18 19 20 21 13 14 15 16 17 18 19 22 23 24 25 26 27 28 20 21 22 23 24 25 26 29 30 31 27 28 29 30 S M T W T F S S M T W T F S 1 2 3 4 1 2 3 5 6 7 8 9 10 11 4 5 6 7 8 9 10 12 13 14 15 16 17 18 11 12 13 14 15 16 17 CITY COUNCIL - 7:00 pm 19 20 21 22 23 24 25 18 19 20 21 22 23 24 1st Tuesdays* 26 27 28 29 30 1 2 25 26 27 28 29 30 31 WORK SESSION - 6:00 pm CITY COUNCIL - 7:00 pm S M T W T F S S M T W T F S 3rd Tuesdays* 3 4 5 6 7 8 9 1 2 3 4 5 6 7 10 11 12 13 14 15 16 8 9 11 12 13 14 PLANNING COMMISSION - 7:00 pm 17 18 19 20 21 22 23 15 16 17 18 19 20 21 2nd Tuesdays* 24 25 26 27 28 29 30 22 23 24 25 26 27 28 31 29 30 PARK COMMISSION - 7:00 pm 3rd Wednesdays* S M T W T F S S M T W T F S HOLIDAYS 1 2 3 4 5 6 1 2 3 4 5 7 8 9 10 11 12 13 6 7 8 9 10 11 12 ELECTION DAYS 14 15 16 17 18 19 20 13 14 15 16 17 18 19 21 22 23 24 25 26 27 20 21 22 23 24 25 26 CITY EVENTS 28 29 30 27 28 29 30 31 *unless otherwise noted January 7th: 5 PM City Council Goal Setting Session February 25th: Precinct Caucuses March 3rd: Presidential Primary (Council moved to Wednesday) April 8th: 6:30 PM Board of Appeal and Equalization Meeting April 21st: 6 PM - Continuation of Board of Appeal Meeting April 25th: 8 AM to Noon Clean-up Day August 11th: Primary Election Day (Planning moved to Wednesday) September 1st: 6 PM Budget Open House September 19th: 4 PM to 8 PM Medina Celebration Day October 6th: Night to Unite (Council moved to Wednesday) November 3rd: General Election Day (Council moved to Wednesday) November 10th: 6PM City Council Special Meeting: Canvass Election Results (Planning Starts at 7PM) December 24th: Employees will use personal leave accrual to close City Hall JUNE NOVEMBER DECEMBER JANUARY FEBRUARY MARCH APRIL MAY JULY AUGUST SEPTEMBER OCTOBER 2020 MEETING CALENDAR 10 Compatibility Report for 2012 Meeting Calendar.xls Run on 11/28/2011 14:52 The following features in this workbook are not supported by earlier versions of Excel. These features may be lost or degraded when opening this workbook in an earlier version of Excel or if you save this workbook in an earlier file format. Minor loss of fidelity # of occurrences Some cells or styles in this workbook contain formatting that is not supported by the selected file format. These formats will be converted to the closest format available. 11 Version Excel 97-2003 1 TO: Medina City Council FROM: Jodi Gallup, Assistant City Administrator Jason Nelson, Public Safety Director Steve Scherer, Public Works Director DATE: May 14, 2020 RE: 2020 Meeting & Event Calendar Updates Clean-up Day Medina’s annual Clean-up Day was originally scheduled for April 25th but had to be postponed due to the Governor’s stay-at-home order. We have received feedback from the community that they would still like to see this event happen to be able to dispose of their unwanted bulky items/garbage/etc., especially since people are at home and have had more time to clean out their garages, basements, and storage areas. Staff is proposing we move the event date to Saturday, July 11th or 18th. We will change the event layout to have a single-file drop off, advertise that people dropping off items must unload their own items (so no additional volunteers are needed), and have staff wear personal protective gear (facemasks and gloves) to accept money and direct residents on where to unload their items. We will not serve food or sell trees at this year’s event. Night to Unite The annual Night to Unite neighborhood gatherings have been postponed nationally from August 4th to October 6th. The original event date was scheduled for the first Tuesday in August, which we had adjusted the City Council meeting calendar to move the Council meeting to Wednesday evening to not conflict with this event. Since the event will no longer interfere with the first Tuesday in August, staff recommends updating the meeting calendar to move the first August Council meeting back to Tuesday evening (August 4th) instead of Wednesday evening. Similarly, the newly scheduled October 6th Night to Unite celebration is scheduled on the first Tuesday in October, so staff recommends moving the October 6th City Council meeting to Wednesday, October 7th. These changes have been reflected on the attached calendar. Medina Celebration Day Medina Celebration Day is scheduled for Saturday, September 19th. This event is our city’s main community festival, which has been drawing over 1,000 people each year. The city staff facilitate the community planning committee each year and coordinate the fundraising, business vendors, food vendors, fireworks contracts, promotional materials, volunteers, entertainment, and event set-up and clean-up. This event takes many months to plan, but we have not yet started planning this year’s event with the uncertainty of COVID-19 and the ability to hold large public gatherings. Staff greatly enjoys this community event but recognizes the need to consider proactively cancelling it for the MEMORANDUM Agenda Item # 8B 2 safety of our residents and employees and to save on city resources in planning an event that may not be able to happen. Additionally, from the perspective of Public Safety, our police officers have not been able to take vacations for two months due to COVID-19 scheduling, therefore there is a lack of personnel that can assist with the event due to the need to schedule weekends off. As for our reserve officers, we again are trying to be very mindful of how we utilize them and not put them into compromising situations as over half fall into the risk category for one reason or another. We are also being mindful that there is a good potential for a second wave of COVID this fall, and it is important for using police personnel only when essential. We are really trying to eliminate large group gatherings where there will be an issue with social distancing and trying to regulate those gatherings. Staff believes it is important that we error on the side of caution by cancelling Medina Celebration Day in 2020. Recommended Actions: • Discuss feasibility of holding a limited contact Clean-up Day Event • Discuss cancelling Medina Celebration Day in 2020 • Adopt updated meeting calendar POLICE DEPARTMENT COVID-19 UPDATE CHIEF JASON NELSON The Lakes Area Emergency Management group continues to meet online weekly and all have reported little or no COVID-19 related illness to personal. The Governor issued three Executive Orders (20-54, 20-55, 20-56) on 5/13/2020. Executive Order 20-56 details the reopening of businesses except for bars and restaurants. EO 20-56 address gatherings including drive-in type gatherings. I have fielded several calls or emails the past few weeks about businesses wanting to reopen, or people wanting to have graduation parties, etc. I am providing those individuals with documentation and information in trying to answer their questions. Most people want to be compliant with the orders and do not want to do anything to violate them. Individuals call with stories about how they are trying to keep their small business open and not lose their vehicles, homes, businesses, etc. It is heart wrenching listening to these stories, and I inform them that I am listening, and we as the Minnesota Chiefs of Police Association, along with the Minnesota Sheriff’s Association, are forwarding our concerns to the Governor’s Office. We will continue to attempt to uphold the orders from the Governor and we will do this through education with the hopes to not take enforcement action. We are always looking to add to our personal protection equipment (PPE). The current goal is to have at least a 30 supply for each employee if the pandemic hits our area. We are currently sitting ok with PPE; the officers have done a great job in preserving them. As of today, we have had very few COVID-19 related medical calls but are aware of some COVID cases in the community and within our congregant care facilities. These numbers continue to rise daily. For example, just yesterday there were a total of 2,926 positive cases in congregate settings which was up 164 cases from the day before. There are 498 congregate facilities with a least one COVID case reported, which is up 23 overnight. Agenda Item # 8C Planning Department Update Page 1 of 2 May 19, 2020 City Council Meeting MEMORANDUM TO: Mayor Martin and Members of the City Council FROM: Dusty Finke, Planning Director; through City Administrator Scott Johnson DATE: May 14, 2020 SUBJ: Planning Department Updates – May 19, 2020 City Council Meeting Land Use Application Review A) Stetler Barn CUP – 1832 Medina Road – Chris and Jim Stetler have requested a Conditional Use Permit for construction of a 12,300 square foot barn and riding arena. The Planning Commission held a public hearing at the April 14 meeting and recommended approval. The City Council reviewed on May 5 and directed staff to prepare a resolution of approval, which will be presented to the City Council on May 19. B) Roehl Preliminary Plat – 1735 Medina Road – The Estate of Robert Roehl has requested a preliminary plat to subdivide 28 acres into two lots. The Planning Commission held a public hearing on May 12 and recommended approval. Staff intends to present to the City Council on May 19. C) Meadow View Townhomes– north of Highway 55, west of CR116 – Lennar has indicated that they will likely proceed with a development under the R3 standards and incorporating as many comments received during previous concept review that they can. D) OSI Expansion – Arrowhead Drive, north of Highway 55 – Arrowhead Holdings (real estate company for OSI) has requested final plat approval for Cavanaughs Meadowwoods Park 3rd Addn. The City Council previously granted approval of a site plan review and preliminary plat to construct an expansion to the existing building and parking lot at 4101 Arrowhead Drive. Staff is awaiting final construction plan, and will present the final plat to the City Council when complete. E) Cates Ranch Comp Plan Amendment and Rezoning – 2575 and 2590 Cates Ranch Drive – Robert Atkinson has requested a change of the future land use from Future Development Area to Business, a staging plan amendment to 2020, and a rezoning to Business Park. The application is incomplete for review, and the City has requested additional materials. F) Mark of Excellence Comp Plan Amendment, PUD Concept Plan – east of Mohawk Drive, north of Highway 55 – Mark Smith (Mark of Excellence Homes) has requested a Comp Plan Amendment and PUD Concept Plan for development of 76 twinhomes, 41 single- family, and 32 townhomes on the Roy and Cavanaugh properties. The Council adopted a resolution granting conditional approval and authorizing submission to the Met Council. Staff is preparing the submission. G) Adam’s Pest Control Site Plan Review, Pre Plat, Rezoning – Jan-Har, LLP (dba Adam’s Pest Control) has requested various approvals for development of a 35,000 s.f. office building, restaurant, and 13,000 s.f. warehouse/repair shop north of Highway 55, west of Willow Drive (PIDs 04-118-23-21-0001 and 04-118-23-24-0001). The Planning Commission held a public hearing at the November 12 and March 10 meetings and recommended approval. The City Council adopted approval documents on March 17. H) Johnson ADU CUP, Hamel Brewery, St. Peter and Paul Cemetery – The City Council has adopted resolutions approving these projects, and staff is assisting the applicants with the conditions of approval in order to complete the projects. I) Hamel Haven subdivision – These subdivisions have received final approval. Staff is working with the applicants on the conditions of approval before the plat is recorded. Planning Department Update Page 2 of 2 May 19, 2020 City Council Meeting Other Projects A) Tamarack Drive study – The City Engineer intends to present the feedback received and draft concepts for review at the May 19 council meeting. B) Hackamore Road Preliminary Design – Online engagement is currently underway on two concepts for the Hackamore Road Improvements. Planning staff prepared a postcard, newsletter article and webpage within formation. WSB has created an online activity that is available and a virtual open house will be held from 5-6:45 on May 19. Both available at https://medinamn.us/hackamore C) Wealshire Phase II – Staff is reviewing plans for construction of Phase II of the Wealshire, to include an additional 56 residents. Construction is anticipated to begin soon. D) Hennepin County Climate Change Partnership – I attended a meeting hosted by Hennepin County to discuss potential partnerships and resources related to policies that the County, cities, watershed, and state agencies can work together to address climate change. TO: City Council FROM: Jason Nelson, Director of Public Safety, Through City Administrator Scott Johnson DATE: May 15, 2020 RE: Police Department Updates The past two weeks have filled with ups and downs within the department. First and foremost, I want to thank the City Council and City Administrator for the support during these unprecedented times. The entire staff at the police department appreciates everything you do for us. We have been lucky that COVID-19 has not reached our staff or its family members, however, this does not mean that it does not have impacts on us both personally and professionally as it has for the rest of the community. The staff has been doing an excellent job with the constant changing mandates, schedule changes in these trying times. Long time Reserve Officer Jeffery Kordiak has turned in his resignation. Jeff has been with the department for the past ten years as a Community Service Officer and a Reserve Officer. Jeff has decided on a career path change into nursing and informed the department that he has enrolled in nursing school and as a result does not have the time to commit to the Reserve organization. We will miss Jeff but wish him the best of luck in his future endeavors. On May 14, 2020 I learned of the passing of Reserve Officer Todd Larson’s father in Rochester, Minnesota. Our condolences go out to Todd and his family as they are all in my thoughts and prayers. Officer Justin Hanson has completed his fourth phase of Field Officer Training and will be out on his own. He will be an excellent addition to our department as he comes with 8 years of experience from Oklahoma. We were extremely lucky to find such a good candidate in our last hiring process. We are still one officer short from what was authorized; more to come next month on that. I have decided that we are going to go back to our normal patrol schedule as of May 19th. There are several other area departments that are doing the same. We will continue using our new standard operating procedures as far as responding to calls for service, everyday patrol operations, cleaning of squads and the police department. The Reserve Officers will be allowed to come back after the holiday weekend and will resume their role as well. We will continually monitor the status of the MEMORANDUM schedule and if needed switch back. All employees have been extremely flexible in doing this but are ready to come back to a normal work schedule. Patrol: Patrol Updates 04/29/2020 through 05/12/2020 Patrol Activities – Between the dates of April 29, 2020 through May 12, 2020 our officers issued 32 citations and 37 warnings for various traffic violations. There were 3 property damage accidents reported, 6 medicals, 7 business alarms, 2 residential alarms, 8 suspicious calls, and 10 assists to other agencies. Rush hour traffic has been picking up in the morning and late afternoon as the Executive Order has been modified to allow more people to go to work. With the Reserves being asked to stay home, Officers have also been conducting additional house/business checks for the residents that have requested additional checks. During this time period 70 house/business checks were conducted. On 05/02/2020 Officers were made aware of a pursuit involving a stolen vehicle was heading towards the Medina border southbound on County Road 116. The pursuit had been initiated in Wright County by Wright County Deputies. Officers assisted with the pursuit which ended up eastbound on Highway 55 into Plymouth where MN State Patrol used spike strips to deflate the vehicle’s tires. The vehicle finally came to a stop on Vicksburg Lane and the suspect was taken into custody without incident. On 05/02/2020 at approximately 10:30 pm a 69-year-old female was arrested for DWI after being stopped for lane violations. The arrested party was brought to West Health in Plymouth where a search warrant was executed and a blood sample was obtained. Charges are pending the results of the blood test. On 05/04/2020 the sewer construction project began along County Road 19 in the southwest area of the city. Numerous complaints were received of north and southbound traffic disobeying the road closed signs and cutting through the Sycamore neighborhood to bypass the closed section of the roadway. Officers conducted extra patrol in the area and stopped 38 vehicles cutting through the Sycamore neighborhood, issuing 28 warnings and 10 citations for driving past the barricades. On 05/07/2020 three suspicious vehicles were reported by a neighbor on a property along the 3000 block of Hamel Road where a home had been torn. Officers arrived and found three teens hanging out on the property. Officers learned that the teens had learned of this spot on social media that it was a good place to hang out. Officers observed a lot of trash laying around indicating that numerous people have been hanging out on the property. The property owner was contacted who was unaware of the issue. Since that incident several other teens have been found on the property who also indicated they had heard of the property on social media. Extra patrol continues at the property and the property owner is working on putting a gate or no trespassing signs on his property to deter further incidents. On 05/10/2020 Officer was dispatched to a welfare check at the Holiday on Baker Park Road. It was reported a male was rolling around in the grass and looked confused. Officers made contact with the individual who was found to possibly be having a mental health crisis. The individual agreed to go to the hospital to be seen by doctors. On 05/12/2020 Officer stopped two off road vehicles for driving on the roadway. Both drivers were found to have revoked driver’s licenses and were cited for those offenses. They were advised to push the vehicles back to their residence. Investigations: In March of 2020, I executed a search warrant and obtained a buccal swab from a suspect. The suspects DNA was found at the scene of a burglary in August of 2019. I recently received the results from the buccal swab, and it was confirmed to be the same DNA that was found at the scene of the burglary. I have submitted my report to the Hennepin County Attorney’s office and requesting the suspect be charged with 3rd Burglary. I completed a theft investigation from a local business. The suspect has been responsible for numerous from area businesses. The case was submitted to the city attorney’s office for charging. Received a report from Hennepin County Child Protection about possible physical abuse at a residence. I have been in contact with a social worker from the child protection about the incident. Investigation is ongoing. Completed some background checks for solicitor permits in the city. MEMORANDUM TO: City Council, through City Administrator Scott Johnson FROM: Steve Scherer, Public Works Director DATE: May 14, 2020 MEETING: May 19, 2020 SUBJECT: Public Works Update STREETS • Public Works graded the gravel streets in town and we have been replacing signs along the roadways. • The streets are in good condition. There are a few potholes that need to be repaired but we are focused on culvert repairs while the stream waters are low. • WSB has been working closely with both Public Works and Planning on visioning for both the Tamarack and Hackamore street projects. There are currently public input opportunities on the website for both projects. WATER/SEWER/STORMWATER • Public Works flushed the hydrants in the Independence Beach area as we do every second Thursday of the month. This schedule seems to keep water complaints to a minimum. • Inflow and infiltration have been halted with the dryer weather. It is difficult to identify problems when sources dry up. • A weekly progress meeting was held with the Metropolitan Council Environmental Services and their construction partners. The project is well on its way, with the first County Road 19 crossing complete already. There will be one more closure when they get to the east end and need to cross County Road 19 one more time. • Public Works completed the work with Burschville Construction to install a large pipe on Ardmore Ave. Public Works assisted in the material handling and reconstruction work. The street was closed for two days. PARKS/TRAILS • The parks are being utilized even more and so it is great to have our seasonal employee on board to assist with the maintenance. • We have been working to secure easements with Loram for the extension of the Arrowhead Trail project. Once the paperwork is done, Public Works plans on starting construction from the railroad crossing to the south, to tie into the existing trail. Dusty Finke plans on drafting the easement for the project. PERSONNEL • Our part time Public Works Maintenance Technician, Nate Dingmann, started and we are glad to have him on board. ORDER CHECKS MAY 5, 2020 – MAY 20, 2020 050215 CHETTIAR, MOHAN ............................................................... $1,150.00 050216 IMMADISETTY, PRATAPKUMAR .............................................. $440.00 050217 MN DEPT OF LABOR/IND(BLDGPERM) ................................ $5,226.23 050218 VOID .............................................................................................. $0.00 PRINTING ISSUE 050219 ADAMS PEST CONTROL INC .................................................... $89.84 050220 ASPEN MILLS INC .................................................................... $225.60 050221 BAILEY NURSERIES, INC. ........................................................ $641.95 050222 BEAUDRY OIL & PROPANE .................................................. $2,019.61 050223 BLUE CROSS BLUE SHIELD OF MN ................................... $33,117.46 050224 BOYER FORD TRUCKS INC ....................................................... $59.99 050225 CAREFREE SERVICES INC .................................................. $6,869.00 050226 CIRCLE V SPECIALTIES, INC................................................... $250.00 050227 D FENCE ................................................................................ $1,900.00 050228 DITTER COOLING & HEATING.............................................. $6,842.79 050229 DPC INDUSTRIES INC ........................................................... $2,059.73 050230 ECM PUBLISHERS INC .............................................................. $94.98 050231 GRAFIX SHOPPE ...................................................................... $111.41 050232 GRAINGER................................................................................ $132.22 050233 HAKANSON ANDERSON ASSOCIATES I ................................ $838.00 050234 HAMEL BUILDING CENTER ..................................................... $203.45 050235 HAMEL LIONS CLUB ................................................................ $525.00 050236 JIMMYS JOHNNYS INC ............................................................ $775.36 050237 LAW ENFORCEMENT LABOR SERVICES ............................... $496.00 050238 LEXISNEXIS ................................................................................ $55.00 050239 MAPLE PLAIN, CITY OF ........................................................... $735.36 050240 MATRIX CONSULTING GROUP ............................................ $3,200.00 050241 MORRIS ELECTRONICS INC. .................................................... $40.00 050242 NAPA OF CORCORAN INC ...................................................... $107.04 050243 NELSON ELECTRIC MOTOR REPAIR ..................................... $375.00 050244 OFFICE DEPOT ........................................................................ $128.35 050245 ORONO, CITY OF .................................................................. $1,277.47 050246 SENSUS METERING SYSTEMS INC ..................................... $1,949.94 050247 STEVES OUTDOOR SERVICES ............................................... $650.00 050248 TALLEN & BAERTSCHI .......................................................... $3,438.00 050249 TIME SAVER OFFSITE SEC SVCS IN ...................................... $509.00 050250 WESTSIDE WHOLESALE TIRE .................................................. $10.00 Total Checks $76,543.78 ELECTRONIC PAYMENTS MAY 5, 2020 – MAY 19, 2020 005511E FURTHER .............................................................................. $1,544.47 005512E CENTURYLINK.......................................................................... $234.10 005513E PR PERA .............................................................................. $15,671.11 005514E PR FED/FICA ....................................................................... $16,223.33 005515E PR MN Deferred Comp ........................................................... $1,850.00 005516E PR STATE OF MINNESOTA .................................................. $3,504.56 005517E FURTHER .............................................................................. $1,749.29 005518E CITY OF MEDINA ........................................................................ $21.00 005519E FARMERS STATE BANK OF HAMEL ....................................... $150.00 005520E AFLAC ....................................................................................... $375.36 005521E CIPHER LABORATORIES INC. ............................................ $10,973.05 005522E CULLIGAN-METRO ..................................................................... $33.70 005523E FURTHER ................................................................................. $577.53 005524E FRONTIER .................................................................................. $56.91 005525E MEDIACOM OF MN LLC ........................................................... $522.24 005526E VALVOLINE FLEET SERVICES ................................................ $198.63 005527E VERIZON WIRELESS ............................................................. $1,651.21 Total Electronic Checks $55,336.49 PAYROLL DIRECT DEPOSIT MAY 19, 2020 0510225 BOEDDEKER, KAYLEN ............................................................ $628.35 0510226 JOHNSON, PATRICK M. ........................................................... $633.53 0510227 ALBERS, TODD M. .................................................................... $230.87 0510228 ALTENDORF, JENNIFER L. ................................................... $1,521.00 0510229 ANDERSON, JOHN G. .............................................................. $230.87 0510230 BARNHART, ERIN A. ............................................................. $2,514.01 0510231 BOECKER, KEVIN D. ............................................................. $2,724.82 0510232 CONVERSE, KEITH A. ........................................................... $1,978.15 0510233 DESLAURIES, DEAN ................................................................ $230.87 0510234 DION, DEBRA A. .................................................................... $1,880.14 0510235 ENDE, JOSEPH...................................................................... $1,721.91 0510236 FINKE, DUSTIN D. ................................................................. $2,594.12 0510237 GALLUP, JODI M. ................................................................... $2,119.18 0510238 GLEASON, JOHN M. .............................................................. $2,417.55 0510239 GREGORY, THOMAS ............................................................ $1,950.75 0510240 HALL, DAVID M. ..................................................................... $2,039.87 0510241 HANSON, JUSTIN .................................................................. $1,956.64 0510242 JACOBSON, NICOLE ................................................................ $949.86 0510243 JESSEN, JEREMIAH S. .......................................................... $2,258.13 0510244 JOHNSON, SCOTT T. ............................................................ $2,286.94 0510245 JONES, KATRINA M............................................................... $1,467.04 0510246 KLAERS, ANNE M. ................................................................. $1,427.39 0510247 LEUER, GREGORY J. ............................................................ $1,947.76 0510248 MARTIN, KATHLEEN M ............................................................ $327.07 0510249 MCGILL, CHRISTOPHER R. .................................................. $1,533.81 0510250 MCKINLEY, JOSHUA D .......................................................... $2,014.46 0510251 NELSON, JASON ................................................................... $2,531.59 0510252 PEDERSON, JEFF .................................................................... $230.87 0510253 REINKING, DEREK M ............................................................ $2,149.90 0510254 SCHARF, ANDREW ............................................................... $1,882.65 0510255 SCHERER, STEVEN T. .......................................................... $2,372.90 0510256 SCHNEIDER, BENJAMIN .......................................................... $599.09 0510257 BIEGERT, CURTIS .................................................................... $569.38 0510258 DINGMANN, NATHAN ............................................................... $256.52 Total Payroll Direct Deposit $52,177.99