The regular meeting was called to order by Mayor Young at 7:30 p.m. Mayor Young delivered the invocation and led the flag salute.

COUNCIL MEMBERS PRESENT:

Mayor Cheryl A. Young

Councilor Bob Schmor

Councilor Marian Calnon

Councilor Bill Guy

COUNCIL MEMBERS ABSENT:

Councilor Gary Hudson

ALSO PRESENT:

Micah Olson, Public Works Superintendent

Leahnette Rivers, City Administrator/Recorder

ATTORNEY PRESENT:

Harold Olsen, City Attorney

A quorum was present and due notice had been published.

AGENDA ITEM 2 PUBLIC HEARINGS:

2.1 Public Hearing: To gather testimony relating to proposed changes to the System Development Charges for Sanitary Sewer and Water based on the periodic application of an adopted inflation adjustment factor.

Public Hearing opened.

No comments were heard from the public.

Public Hearing closed.

2.2 Public Hearing: To gather public testimony relating to proposed changes to the commercial and industrial sewer usage fees based upon recent winter water usage history.

Public Hearing opened.

No comments were heard from the public.

Public Hearing closed.

AGENDA ITEM 3 CITIZEN INPUT:

None.

4.1 Parks Committee: Chair Calnon said a "thank you" note was received from Means Nursery, and she also has a list of desirable and undesirable street trees. She said Leahnette Rivers discovered a tremendous bargain in azaleas, and 51 azaleas were purchase for just over $2.00 each. She said they are big and beautiful, and several have already been planted in Bundy Park.

4.2 Water Source and Development Committee: Chair Guy said the Water Committee recently met. He said we have received some really positive feedback from the Health Division and DEQ about Coastal's groundwater wells. He said we are looking into whether or not we can transfer our water rights from Bundy and Harvard Parks to the Coastal wells. He said testing the wells is the next step, and Coastal would like a hold harmless agreement in place first. Chair Guy said the City's generator will be used to conduct the flow testing. He said if the wells work out, we will need to install an access road, pipeline, and an electrical service. He said the Water Committee recommends the Council move forward with testing, and ultimately acquiring, the Coastal wells.

Chair Guy said we will need to pull the pumps and weld lids on the wells at Ninth Street before the reservoir construction begins. He said the Committee reviewed the bids received for the reservoir project, and Skaar Construction appeared to be the low bidder with a bid of $1.73-million. He said the bids ranged between $1.73-million and $2.07-million, and the engineer's estimate was $1.91-million. He said the Water Committee recommends the Council move forward with Skaar Construction.

Chair Guy said the Health Division has reviewed the plans for the water reservoir project, and is requiring the installation of a meter to calculate contact time, which may result in the first change order for this project.

Chair Guy said the Committee also discussed future reservoir sites, discussions with St. Helens about our water rate, and the need to hire a leak detection company due to our recent water loss.

Micah Olson said the leak detection work will begin on Monday.

Chair Guy said during the initial piping work on the reservoir, we will need to temporary shut down our lower reservoir and rely solely on the upper reservoir for a few days. He said during the month of May we will need to ask our citizens to conserve water.

Leahnette Rivers asked Council to review a draft License Agreement prepared by Harold Olsen to be presented to Coastal for their review and consideration. She asked Council to consider authorizing the Mayor's signature to the agreement if the Agreement meets with Coastal's approval.

MOVED (GUY), SECONDED (SCHMOR) AND CARRIED UNANIMOUSLY TO AUTHORIZE THE MAYOR TO SIGN THE LICENSE AGREEMENT WITH COASTAL.

Leahnette explained that a 25% water rate increase was scheduled to occur in September 2002, but the rate increase was postponed. She said the fund balance of the Water Fund has been dropping steadily, and a rate increase is needed. She provided the Council with several water rate scenarios to review. She recommended that most of the increase be in the base rate this time because the greatest share of the last rate increase was placed on the higher water users. She suggested a public hearing be held in May and the rate increase be effective with the June billings. She said the rate increase should generate at least 22% in additional revenue in order to balance the 2003-04 budget. She noted that an additional rate increase will be needed to meet the Safe Drinking Water Loan Requirements and/or generate the additional revenue needed for our loan payments. She said the amount of the future rate increase is unknown at this time because it will be affected by the outcome of the water rate discussions with St. Helens, the Coastal wells, and the total water improvement project costs.

The Council discussed the rate increase options with staff at length. It was the consensus of the Council that staff develop a proposed rate schedule that will generate the necessary revenue for further discussion at the next meeting. Staff will also put information about the rate increase and public hearing in the next newsletter.

4.3 Streets Committee: No report.

4.4 Sewer Committee: No report.

4.5 Other Reports: None.

5.1 Approval of the Minutes of the Regular City Council Meeting of April 3, 2003.

MOVED (SCHMOR), SECONDED (GUY) AND CARRIED UNANIMOUSLY BY ROLL CALL VOTE TO APPROVE THE CONSENT AGENDA.

None.

Leahnette Rivers explained that Councilor Guy obtained new energy-efficient fluorescent lighting ballasts and lamps for the City Hall at a very low cost, and the PUD will reimburse the City for the first $780.00 spent to implement these changes.

Councilor Schmor asked if we are looking at making similar changes at the City shops. Micah Olson said the PUD has looked at the current fixtures in the shop and is coming up with recommended changes for consideration.

MOVED (SCHMOR), SECONDED (CALNON) AND CARRIED UNANIMOUSLY TO AUTHORIZE SIGNATURE TO THE AGREEMENT.

MOVED (GUY), SECONDED (CALNON) AND CARRIED UNANIMOUSLY TO ADOPT COUNCIL BILL NO. 03-275.

MOVED (SCHMOR), SECONDED (CALNON) AND CARRIED UNANIMOUSLY TO DECLARE AN EMERGENCY.

MOVED (SCHMOR), SECONDED (GUY) AND CARRIED UNANIMOUSLY TO ADOPT COUNCIL BILL NO. 03-276 WITH THE EMERGENCY CLAUSE.

MOVED (CALNON), SECONDED (SCHMOR) AND CARRIED UNANIMOUSLY TO ADOPT COUNCIL BILL NO. 03-277.

The Council reviewed the results of the five bids received for the reservoir construction project as follows:

• Skaar Construction $1,737,000.00
• Ward-Henshaw Construction $1,827,027.59
• Emery & Sons Construction $1,882,099.00
• Marion Construction $2,013,984.29
• Slayden Construction $2,072,670.00

MOVED (GUY), SECONDED (SCHMOR) AND CARRIED UNANIMOUSLY TO AWARD THE CONTRACT TO SKAAR CONSTRUCTION IN THE AMOUNT OF $1,737,000.00.

The Council reviewed proposals for water rate consulting services received from Galardi Consulting, Economic and Engineering Services, Inc., and Economic & Financial Analysis.

Leahnette recommended the City hire Economic and Engineering Services, Inc., based upon their qualifications and information received from references.

MOVED (CALNON), SECONDED (SCHMOR) AND CARRIED UNANIMOUSLY TO HIRE RANDY GOFF OF ECONOMIC AND ENGINEERING SERVICES, INC. FOR WATER RATE CONSULTING SERVICES.

Budget Issues: The Council reviewed a memo dated April 14, 2003, from Leahnette Rivers regarding a projected cost of living adjustment (COLA), insurance premium increases, and the increase in the City PERS contribution rate. It was the consensus of the Council that City employees will receive a 1.0% COLA effective July 1, 2003, based upon the change in the Federal and Portland indexes during the 2002 calendar year. The Council discussed insurance premium costs and insurance plan choices at length with staff.

Truck parking and Jake brakes: The Council reviewed and discussed the results of a truck parking survey showing weight and parking limitations other cities have imposed. In addition the Council discussed ODOT's response to the request to put up signs prohibiting the use of Jake brakes. It was the consensus of the Council that the Mayor write a letter to ODOT about the signs.

Computer Quotes: Leahnette Rivers said she received quotes for computer hardware and operating systems needed for the City's Springbrook Software upgrade. She said quotes were received from Star Computer, LaLuna Computer and CDW-G. She recommended the purchase be made from Star Computer, who provided the City with the lowest quote in the amount of $2,518.90.

MOVED (SCHMOR), SECONDED (CALNON) AND CARRIED UNANIMOUSLY TO PURCHASE THE COMPUTER SERVER AND WORKSTATION FROM STAR COMPUTER IN THE AMOUNT OF $2,518.90.

Gravel: Micah Olson reported that most of the alleyways have been re-graveled, and Councilor Schmor thanked him for adding gravel to the post office parking area.

Hall litigation: Harold Olsen reported that the Bill Hall lawsuit has been resolved and dismissed, and the shed has been moved.

Street lighting: Councilor Guy inquired about the status of the street lighting upgrade. Leahnette said she will check with the PUD about the status of that project.

The Council convened in Executive Session.

The Council reconvened in Open Session.

MOVED (SCHMOR), SECONDED (BILL) AND CARRIED UNANIMOUSLY TO AUTHORIZE THE MAYOR TO SIGN THE SETTLEMENT AGREEMENT WITH MORSE BROS. AFTER THE ATTORNEY'S HAVE AN OPPORTUNITY TO REVIEW IT, AND TO AUTHORIZE THE MAYOR TO WITHDRAW THE APPEAL AGAINST MORSE BROS. APPLICATION AT THE COUNTY PLANNING COMMISSION ONCE THE AGREEMENT IS SIGNED.

There being no further business to come before the Council, the meeting adjourned at 9:31 p.m.

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