PRESENT: Council members Snedden and O’Hara were present. Councilwoman Newton, Chair of the Administrative Committee, was absent. Mayor Hellar was present.
STAFF PRESENT: Planning Director Jeremy Grimm, City Attorney Will Herrington, City Treasurer Shannon Syth, Police Chief Mark Lockwood, Fire Chief Robert Tyler and City Clerk Maree Peck
OTHERS PRESENT: Susan Drumheller, Kathleen Hyde, Gary Garrett, Kevin Trost, Bob Hawn and Liz Hawn.
Councilman O’Hara moved to appoint Councilman Snedden as Acting Chair for this evening’s meeting. Motion passed.
1. PEND D’OREILLE BAY TRAIL MEMORANDUM OF UNDERSTANDING
Councilman Snedden explained that the proposed Memorandum of Understanding is for the administration of the terms and conditions of a $650,000 grant administered by the Department of Environmental Quality (DEQ) for the purpose of conducting environmental assessments at properties associated with the proposed Pend d’Oreille Bay Trail. He said the agreement is between DEQ, Bonner County, Sandpoint, Ponderay and Kootenai. He noted the Cities of Ponderay and Kootenai had already signed the document. City Attorney Will Herrington confirmed that he reviewed the proposed memorandum of understanding and felt it was appropriate.
Councilman Snedden believed the party responsible for the contamination has the first duty to clean up but there is currently nothing identified as contaminated. He noted that Steve Gill of DEQ expected this grant to be $6.5 million for Bonner County and hoped work would begin this fall with only one other Brownfield grant provided in Idaho. He said DEQ is drawing up the work plan and wasn’t sure if they put out to bid for a contract for engineering. Susan Drumheller, member of the Idaho Conservation League and Friends of the Pend d’Oreille Bay Trail, stated Steve Gill from DEQ is looking for local contractors but at this point it’s just an assessment. She said the next grant would be for a cleanup grant.
RECOMMENDATION TO CONSENT CALENDAR: That city council approve the proposed Pend d’Oreille Bay Trail Memorandum of Understanding and to authorize the mayor and city clerk to sign with Councilman Snedden abstaining.
2. DSBA CONTRACT TO MANAGE BID
Kathleen Hyde, Office Manager of Downtown Sandpoint Business Association (DSBA), stated there were no changes to the proposed agreement from last year and that the DSBA Board was satisfied in renewing the contract. Councilman O’Hara asked whether $500,000 in liability coverage was sufficient. Will Herrington noted the city is protected from claims that are over $500,000 and explained there are some events which require higher liability insurance. Kathleen Hyde stated that the DSBA does not insure more than $500,000. She said they sponsor Crazy Days and the holiday tree lighting.
RECOMMENDTION TO CONSENT CALENDAR: That city council approve the proposed
DSBA Contract to Manage BID and to authorize the mayor and city clerk to sign.
3. DSBA BUDGET
Kathleen Hyde, DSBA Office Manager, explained the budget is $140,000 based on if everyone pays their BID on time. She said they budgeted $3,000 in the prior year for the city’s annual audit but there was a change for 2009-10 in the amount of $1,500 because DSBA wanted to hire a private auditor. City Treasurer Shannon Syth noted that the DSBA is a component unit of the city and has to be audited under the city’s auditor because of the way DSBA was created. She stated the city’s annual auditor contract will be on the September Administrative Committee agenda and could try to negotiate for less.
Kathleen Hyde explained to Councilman O’Hara that the budget subtotal are the costs and what DSBA collected from the business association members but is not 100% of income that’s available as several businesses have been delinquent. Shannon Syth explained the funds for special projects and grant matches include those monies received from collections. Kathleen Hyde said some of these funds will be utilized to install a kiosk by the end of August 2009. Kathleen Hyde noted that a person can’t run for membership of the DSBA board unless their dues are current. She stated it’s difficult to determine the amount of the dues that will be collected. Shannon Syth said the city keeps a portion of the revenue that covers the cost for the City to bill and collect as well as the supplies since it’s a separate fund. She noted property taxes can’t pay for the fund. She said the DSBA’s budget will not match the city’s budget because the city adopted their preliminary budget in July and DSBA can ask for an amendment according to the contract.
RECOMMENDTION TO CONSENT CALENDAR: That city council approve the proposed DSBA 2009-10 budget.
4. ARRA ACT GRANT FUNDING FOR ENERGY GENERATION FACILITY AT THE AIRPORT INDUSTRIAL PARK
Planning Director Jeremy Grimm stated that he has been working with Matt Janssen, CEO of Vapor Locomotive Company and Karl Dye, Executive Director of Bonner County Economic Development for submission of a $500,000 grant for the development of a wood biomass cogeneration energy facility on approximately 2.89 acres of City owned property in the Airport Industrial Park. He noted that the rules were released yesterday and the guidelines have been published for three months. He noted the grant application is due October 30th. He said he was seeking city council approval, with no commitment of tax dollars at this time, to put together the project to build a boiler utilizing the wood waste from McFarland Pole Company to produce electricity and steam to be used for heating and cooling for the Bonner Business Center and city shop. He said the electricity would be generated through Avista that would allow the creation of a power district. He stated all city buildings could utilize the power and steam from this power system. He said the city would have a partnership through Panhandle Area Council (PAC) to secure funding which would allow PAC to build $2 million in facilities. He noted that a local laundromat has interest which would be a major buyer of thermal energy. He said PAC would fund through a 504 SBA loan and the businesses could lease purchase or own the structures. He said he was seeking approval to proceed that would take 30 hours of staff time and would include issuance of revenue bonds through the Economic Development Corporation of Sandpoint (EDCS) for the energy production facility. He said the maximum allowance would be for a $500,000 grant and would visit with EDCS to investigate the issuance of $2.5 million in industrial revenue bonds with a projected cost of the project of $3 million for the power generation facility. He said the revenue estimated for the sale of the electricity and steam is projected to manage the debt service for the industrial revenue bonds. He said the State of Idaho is looking for pilot projects for the Renewable Enterprise Zone Grant.
Mr. Grimm explained the buildings on the east side of the property would be funded, constructed and sold to businesses through PAC. He said the projected revenues are predicated by data provided from Mr. Janssen with a need of use of thermal energy by enticing and securing the demand of users. He expected letters of commitment and agreement of PAC before any financial obligations were encumbered. He said the cost of fuel would be $2.90 per ton. He said there would be a limiting factor and could be mirrored on the Renova site. He said there was a question as the where to get the dedicated fuel source for 20 years of bond obligation. He stated it would be difficult to guarantee that the fuel source was available. He said consideration should be given that the Federal government would continue with tree harvesting. He said a background could be conducted on McFarland Pole Company as to whether or not they plan to charge for the use of the land. He said chipped wood would be available elsewhere but at a higher rate. He said the proposed property was an ideal location because it has a density of users that could guarantee the user demand and the city owns the land. He noted the Litehouse Treatment Facility is located in the same area where they use their waste oil for biodiesel. He said in 2007 a resolution was adopted that provided criteria for the Sandpoint Airport Industrial park with this proposed project meeting the threshold outlined in the resolution. He stated the property is currently used for snow storage. He hoped to calculate the thermal demand that could be used to heat the city shop. He stated it would be likely the city would be taking a waste product with the possibility of receiving carbon offset credit and could qualify for other Federal credits for energy production.
He said the city could sell the structures and recover the costs or lease them. He said there would be consideration as to whether the city would be a utility and have city employees manage the facility or that the city would sell to investors or the private sector. Councilman O’Hara commented this proposed project dovetails with the City of Sandpoint of going “green” and felt it was a great idea. Councilman Snedden questioned why the facility would be used to heat only city buildings and felt it could provide a private business element. Jeremy Grimm stated there was discussion of providing electricity to all buildings within the industrial park.
RECOMMENDATION TO CONSENT CALENDAR: That city council authorizes to develop and submit a $500,000 grant to the Idaho Office of Energy Resources to construct a combined heat and power generation facility on city owned land.
5. GARRETT TRANSMITTER SITE LEASE
Gary Garrett, sole proprietor of North Idaho Connection, stated that he provides communication for Bonner General Hospital and the City of Hope for high speed internet access and focuses on those areas outside the area that need his services. He noted that he currently has 300 customers and has been in operation since 1999. City Treasurer Shannon Syth suggested revising the second sentence in Section 6 to add “including utilities”. City Attorney Will Herrington explained that this was a standard lease used for all facilities at Baldy Mountain. He stated that the city would be adopting standards for users to insure there was no interference between owners. He said he would also add a provision requiring lessees to utilize those standards. He stated that all lessees would follow the same lease. He noted that the contract incorporates the rates per resolution plus the fees increased according to the Consumer Price Index.
Police Chief Mark Lockwood stated that the City of Sandpoint is one of the users on the tower which is used for the Public Works shop, Parks Department and the water treatment plant. Chief Lockwood noted the city owns a 60 foot tower and that Mr. Garrett has an antenna plus a smaller tower attached to the city’s building. Councilman O’Hara suggested striking the language requiring the lessee to install a 40 foot tower as Mr. Garrett and Chief Lockwood confirmed that it has already been installed. Will Herrington explained Section 3 is provided so the lessee knows they have an extra three years to negotiate before the lease is terminated. He said it’s a protection for the lessee.
RECOMMENDTION TO CONSENT CALENDAR: That city council approve the proposed Garrett Transmitter Site Lease as amended and to authorize the mayor and city clerk to sign.
FIRE RECOVERY USA
Kevin Trost of Fire Recovery USA noted the process for fire service billing has been in existence for over 20 years. He stated insurance companies have provided coverage for this type of billing but that fire departments have not been aware that they can go after the cost for their services. He said the cost of loss prevention and mitigation is included in policyholder policies. He stated that since the cost of services has risen, there have been no other avenues to seek reimbursement for services. He explained that when the fire department responds, they provide his company with the information and then they submit the information to the insurance company. He said the insurance company will identify the coverage the person has and will let them know how much they will pay. He said the payments are based on the type of incident which takes 30 to 90 days for the process. He stated the city defines the rules for Fire Recovery USA such as whether or not city residents will be billed. He said they deal directly with the insurance company to seek reimbursement or payment. He said for those people who don’t have insurance, direction needs to be provided from the city to his company as to whether or not they will be billed directly.
Councilman Snedden said there were three issues to consider such as to whether to agree to adopt the fees for services, agree to contract with Fire Recovery USA for collection of fees, and to adopt a false alarm ordinance. Fire Chief Robert Tyler stated that persons would be billed for false alarms, for example, after the third false alarm; the city would have the ability to bill to recover the costs for services. City Attorney Will Herrington noted the other reason for a false alarm ordinance is because businesses won’t correct their systems unless they are charged. He noted that other communities have adopted false alarm ordinances and suggested to include burglar alarm systems. City Treasurer Shannon Syth stated that city council will be setting a public hearing at next week’s regular council meeting to be scheduled in September which could include the fire department service fees since they are new fees. Will Herrington explained the false alarm fees would be billed directly to the business. He stated there was an Idaho case, Brewster v. City of Pocatello in 1988, where fees were thrown out because the city was charging for street maintenance and was not a fee that was authorized by the State of Idaho. He said there could be a risk and advised not to make it determinative as to their decision but should be aware the fees could be challenged. He said if the council feels the fees were a good idea, the matter could be dealt with later. He noted there were differences between the fees charged in the Brewster case versus the proposed fees as discussed this evening. He said he would forward the Brewster case to city council.
Chief Tyler added that a person that could be billed directly if they were self insured. Councilman Snedden suggested tabling the false alarm ordinance until next month’s Administrative Committee meeting with an option of adding burglar alarms. He felt it was premature to approve the contract as he had several questions. Chief Tyler noted that the fire department would already have the information that Fire Recovery USA would need. Mr. Trost explained that there was no administrative costs and that the information is forwarded to a secured website which is live 24/7, password protected. He said there may be cases where they run into fraudulent calls. He stated there are a percentage of cases where they could be uncollectable. Chief Tyler said the reason fire departments have not been successful in doing self billing themselves because they need to have someone dedicated to deal with the billings on a full time basis and that fire service billing companies have more experience dealing with insurance companies.
Councilman Snedden suggested tabling the contract with Fire Recovery USA but to only forward to full city council discussion of adoption of user fees for these services, then discuss the proposed ordinance, user fees, and who would be billed next month. Will Herrington suggested that city council review false alarms fees as well and wouldn’t adopt the proposed false alarm ordinance until the September or October regular city council meeting.
RECOMMENDATION: That the full city council review and discuss at the August 19th regular city council meeting the proposed fire department user fees and false alarm fees.
PROPOSED FEE SCHEDULE
City Treasurer Shannon Syth stated that it has been in the past few recent years that city council has reviewed all fees at the same time and is determined during the budget process when reviewing fees. She said city council will set a public hearing in September with the fees to become effective October 1, 2009. She noted that some proposed fee increases were not available as city council will meet with a consultant to review water and sewer rates on August 20th. She pointed out that Community Hall rental fee increases are proposed. She said the reason for the increases are because the city no longer received revenue from Bonner County as they now utilize the meeting room at their new location at the former Federal Building. She said that city council approved a 2% moorage slip fee increase at their July 15th regular city council meeting which will not require a public hearing. She said the Parks and Recreation Director requested that the fees be rounded off to the nearest dollar. She pointed out that the only new fee was for park special events and commercial events. She also mentioned that the Public Works Committee recommended a new way for structuring building permit fees but needed to be determined by city council. She said Water New User Facility Fees (NUFFS) are to be determined based on a rate study and that sewer and water rates are to be determined by city council at a later date. She pointed out that only those fees that are new or are increased over 5% will be set for public hearing on September 16th and will be effective October 1st.
RECOMMENDATION: That the proposed fee schedule be reviewed and discussed with full city council at the August 19th regular meeting and to set a public hearing on September 16th regular city council meeting for all new fees and those over 5% and that this matter be placed on the Public Works Committee and Administrative Committee agendas in September.
The meeting adjourned at 7:04 p.m.
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Maree Peck, City Clerk
