HomeMy WebLinkAbout1988-09-12
409
MINUTES OF THE MEETING OF THE CITY COMMISSION
BOZEMAN, MONT ANA
September 12, 1988
************************
The Commission of the City of Bozeman met in regular session in the Commission Room,
Municipal Building, September 12, 1988, at 2:00 p.m. Present were Mayor Stiff, Commissioner
I Hawks, Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung, City Manager
Wysocki, City Attorney Becker and Clerk of the Commission Sullivan.
The meeting was opened with the Pledge of Allegiance and a moment of silence.
Minutes
It was moved by Commissioner Hawks, seconded by Commissioner Vant Hull, that the
minutes of the regular meeting of August 29, 1988 be approved as amended. The motion carried
by the following Aye and No vote: those voting Aye being Commissioner Hawks, Commissioner
Vant Hull, Commissioner Martel, Commissioner Goehrung and Mayor Stiff; those voting No, none.
Request for permission to address Commission re interest calculations on special improvement
districts - Bob Kern
City Manager Wysocki noted that the Commissioners had received a copy of the memo from
Mr. Kern, dated August 30, 1988, to Administrative Services Director Miral Gamradt, as well as
a copy of the letter dated August 31, 1988, from City Attorney Becker to Terry Schaplow, at-
torney, responding to Mr. Kern's memo.
Mr. Bob Kern, Bozeman Realty, Inc./Century 21, stated that in March 1988, a lady in
California listed four lots in Graf's First Subdivision for sale. He noted that delinquent taxes
and assessments were found on those lots; and he asked the County and City staffs how much it
would cost to bring those delinquencies current. He indicated that the City staff gave a rough
estimate of what the cost might be, depending upon the closing date. He stated that a second
I call, seeking a concrete figure as of a possible date of closing resulted in a response that the
calculation would be made when a firm closing date was known, due to the time required for
such calculations. He indicated that the procedure for those calculations was verbally reviewed,
however, with a new real estate salesman.
Mr. Kern stated that his real estate firm sold two of the lots and figured the delinquent
taxes to be paid. He noted that upon checking with the City, however, they found that, even
though the figure was high compared to the original assessment, it was $7,000 low. He indicated
that the lots had been listed at $2,500 each and had been sold at a lower amount.
Mr. Kern stated that conversations with the Administrative Services Director have reveal-
ed that if the City staff had given inaccurate information, the amount received to bring the
assessments current could have been adjusted to the inaccurate number. He noted, however,
that the staff has indicated it cannot accept a lesser amount since no figure was given.
Mr. Bob Kern then referred to the opinion from Dorsey and Whitney in 1987 which indi-
cated the City cannot accept payment of only the delinquent assessments to reinstate an accel-
erated balance on the books; but the entire balance must be paid. He noted the City has not
followed this procedure, suggesting the Commission consider reinstating the balance after pay-
ment of the delinquent balance as he has calculated it. He stated this action would allow the
delinquency to be paid and reinstate those properties in the current assessment process.
Administrative Services Director Gamradt stated that Mr. Kern's comments basically reflect
the situation to date. He stated that conversations with the City staff involved and review of
the information submitted to Mr. Kern indicate that the staff did not submit inaccurate inform-
I ation; therefore, he cannot approve acceptance of the lower amount as calculated by the real
estate agent. He further noted that the staff submitted nothing in writing to Mr. Kern concern-
ing the assessments for the two lots currently under discussion.
The Administrative Services Director then reminded the Commission that the State law
does not make any provision for waiving of any of the penalty and interest due on delinquent
assessments, nor does it make any provision for deceleration of an accelerated special improve-
ment district assessment.
09-12-88
410
Administrative Services Director Gamradt stated the current policy is that the staff may
give an estimate of the assessments to be paid, with the actual amount to be calculated only
when a definite closing date has been established. He noted that the closings never happen on
75 percent of those properties for which assessments have been requested. He stated that to
figure the past-due amount on accelerated assessments is very complex, taking approximately one
hour to totally calculate. He indicated the staff has discussed the possibility of charging a $15
fee for all requests for calculation, with that amount to be applied to the payment if the sale is I
completed.
Mr. Kern asked if it would be possible to have a worksheet so those involved in the real
estate transaction could figure the amount of assessments due.
The Administrative Services Director indicated it would be possible; however, the manner
in which accelerated balances are calculated is much more difficult than for delinquent assess-
ments. He noted that in a letter to Dorsey and Whitney explaining the calculation process, it
took two pages of narrative to cover the procedure. He suggested to provide a worksheet for
accelerated balances could create a problem in calculations.
Commissioner Vant Hull asked how long the assessments on the subject lots have been ac-
celerated; the Administrative Services Director indicated since 1984.
The Administrative Services Director then stated that about two years ago the City began
sending letters to those property owners with delinquent assessments indicating when the assess-
ment was first delinquent, the accelerated balance and the penalty. He noted the interest is not
included, since that changes on a daily basis.
Commissioner Goehrung asked if a request for an assessment balance would result in an
accurate number or an estimate.
Administrative Services Director Gamradt stated that an estimate would be given; and that
is usually within $200 to $300 of the actual amount.
Mayor Stiff asked if this type of request has been approved in the past; the Adminis-
trative Services Director stated he knows of no instance in which the Commission has waived the
penalty or interest on a delinquent assessment. He noted that in those instances where an error I
was made, such as in sending a notice to the wrong individual, he has allowed the payment to
be made late without charging penalty and interest.
Commissioner Hawks asked if the subject lots could be sold at tax sale.
The Administrative Services Director stated that several months ago, he submitted a re-
quest to the County Treasurer to proceed with all tax sales for which the three-year time period
has expired. He indicated he has received no response to date.
Commissioner Vant Hull asked if the $7,000 difference in the amount due was for both lots
sold.
Mr. Kern stated that was for one lot only. He then indicated that the amount of delin-
quencies on the four lots totaled $42,406.30 in December 1986. He noted that under the City's
calculations, the total cost of the one lot is $30,500.
Mr. Scott Heck, owner of Security Title Company, noted that if the City reinstates the
assessments on the two subject lots under Mr. Kern's request, it will receive approximately
$19,000 in delinquent assessments and have the balance in a current status. He then stated if
the subject property is sold at a tax sale, the new property owner will receive a tax deed; and
the title company wi II not issue title insurance on the property based on that deed. He indi-
cated that, as a result, the owner will be unable to build a home on that property if any type of
financing is required. He noted that the courts have held that the taxpayers or the former
owner of the property have certain reversion rights for a period of time; and those individuals
may exercise their rights. He indicated that a municipality may go through the process to quiet
title; however, that does not totally eliminate this possibility. I
Mr. Heck then suggested that when someone requests a balance, the staff may be able to
give an amount as of a specific date, with a per diem which could be utilized to estimate the bal-
ance as of a specific closing date. He noted this would give an individual a more realistic figure
while alleviating some of the workload on the City staff.
City Manager Wysocki asked the City Attorney to address the statutory regulations on
this issue.
City Attorney Becker stated his response to Terry Schaplow covers the statutory regu-
lations. He noted the procedure to be followed in collection of delinquent assessments is very
09-12-88
411
specific. He indicated that bond counsel has reviewed the City's process for determining the
balance due on accelerated delinquencies and noted the process is proper. He then noted the
City has changed its policy and no longer accelerates the balance when an assessment becomes
due; however, there are several delinquencies which occurred under that policy.
City Manager Wysocki reminded the Commission that they had discussed the possibility of
legislative action to allow a conscious deceleration of formerly accelerated assessments, possibly
I on a one-time basis, to address items such as this.
City Attorney Becker noted that the most recent Attorney Genera(ls opinion is that once a
del inquent assessment is accelerated, it cannot be decelerated.
Commissioner Vant Hull noted the 1972 State Constitution is to be construed liberally,
which is a different concept from the Dillon Rule under which cities previously operated. She
then suggested that an Attorney Generalis opinion be sought, based on the new Constitution.
The Commissioner then suggested this item could possibly be consciously acted upon by the Com-
mission as a potential court case to determine whether the Constitution is to be liberally con-
strued.
Commissioner Hawks indicated support for following the legislative process rather than the
judicial process in addressing the possible deceleration of accelerated delinquent assessments.
Commissioner Martel noted that under the acceleration policy, the penalty and interest can
easily increase the amount to more than the original principal balance within a few years.
Commissioner Goehrung reminded the Commission that they had a similar request recently
involving a lot on Lea Way; and that request was not approved. He then expressed concern
about dealing with these requests on an individual basis. He noted that to approve this request
would result in the current owner being able to walk away from the delinquency without feeling
the full impact of the penalty and interest thereon.
Commissioner Hawks suggested this might be a legislative item to be considered by the
Montana League of Cities and Towns.
City Manager Wysocki noted that a bill to allow deceleration of accelerated delinquent bal~
I ances could be beneficial not only to cities and towns, but to real estate agents and title com-
panies as well. He then reminded the Commission that the economic circumstances were substan-
tially different when the decision to accelerate was made; and he does not feel that decision was
wrong. He questioned, however, whether the full impact of such action was realized at that
time.
Commissioner Vant Hull stated she feels the City has enough reason to make a decision to
decelerate this assessment. She indicated that the legislative process would be slow; and the
judicial process would result in a much quicker response. She stated she feels that the process
would pay for itself through the payment of delinquent assessments.
Mayor Stiff stated that he feels to take any action other than denial would be rather
dangerous and result in setting a precedent that may be difficult to deal with.
Commissioner Martel indicated he feels the City has been caught in a situation created by
time and economic change; and he would support approval of the request.
City Manager Wysocki recommended that the Commission not approve deceleration of the
accelerated delinquency, noting that the Attorney General's opinion on this issue was rendered
less than a year ago.
It was moved by Commissioner Vant Hull, seconded by Commissioner Martel, that the Com-
mission approve deceleration of the delinquent assessments on the two subject lots, as requested
by Mr. Bob Kern. The motion failed by the following Aye and No vote: those voting Aye being
Commissioner Vant Hull and Commissioner Martel; those voting No being Commissioner Goehrung,
Commissioner Hawks and Mayor Stiff.
I Authorize Mayor to sign - budget amendments for closing of Fiscal Year 1987~88
City Manager Wysocki presented to the Commission a memo from Administrative Services
Director Gamradt, along with the budget amendments necessary to balance the books for closing
of Fiscal Year 1987-88.
The Administrative Services Director stated that a large portion of the budget amendments
are to eliminate the deficit balances in the internal service funds, which total about $110,000.
He noted that was a conscious decision made as a result of the auditorsl recommendations.
09-12-88
412
The City Manager recommended that the Commission authorize the Mayor to sign the bud-
get amendments as presented.
It was moved by Commissioner Martel, seconded by Commissioner Goehrung, that the Com-
mission authorize the Mayor to sign the budget amendments for closing of Fiscal Year 1987-88.
The motion carried by the following Aye and No vote: those voting Aye being Commissioner
Martel, Commissioner Goehrung, Commissioner Hawks, Commissioner Vant Hull and Mayor Stiff;
those voting No, none. I
Authorize closing of four funds into the General Fund
City Manager Wysocki presented to the Commission a memo from Administrative Services
Director Gamradt requesting authorization to close the following four funds into the General
Fund, along with the current balances: Auction of Assets, $3,486.63; Washington Library Net-
work, $655.61; Library LSCA Grants, $733.99; and Library Public Info Campaign, $297.41, for a
total of $5,173.64. He noted that the activities funded through these four special funds have
been completed and recommended that the balances be closed into the General Fund.
Commissioner Vant Hull noted that three of these funds pertain to library activities and
suggested that those monies be utilized to supplement the book budget.
Administrative Services Director Gamradt stated he has discussed this item with Director
of Libraries Steve Cottrell. He noted that these balances are from last fiscal year; and specific
Commission authorization would be required to spend the monies in this fiscal year. He stated
that Mr. Cottrell is to seek such authorization when he wishes to use additional monies for the
purchase of books.
It was moved by Commissioner Goehrung, seconded by Commissioner Hawks, that the
Commission authorize the closing of the Auction of Assets, Washington Library Network, Library
LSCA Grants, and the Library Public Info Campaign, totalling $5,173.64, into the General Fund.
The motion carried by the following Aye and No vote: those voting Aye being Commissioner
Goehrung, Commissioner Hawks, Commissioner Vant Hull, Commissioner Martel and Mayor Stiff;
those voting No, none. I
Award bid - negotiated bond sale for SID No. 654 - paving of Lea Way - $56,100
Award bid - construction of 5 ID No. 654 - avin of Lea Wa
ut orize City Manager to sign - engineering contract for ID No. 654 - Rick Kerin and Asso-
ciates
City Manager Wysocki stated that the construction bid documents contained an error in
quantities; and the consulting engineer is currently obtaining signatures from the four bidders
acknowledging that error. He then indicated that process has not yet been completed; there-
fore, the staff would recommend that action be deferred for a period of one week. He noted
that the staff has discussed this issue with Mr. Banks, who has indicated a willingness to pur-
chase the bonds; and the one-week delay is satisfactory with him.
It was moved by Commissioner Hawks, seconded by Commissioner Vant Hull, that action
on these three items be tabled for a period of one week. The motion carried by the following
Aye and No vote: those voting Aye being Commissioner Hawks, Commissioner Vant Hull, Commis-
sioner Martel, Commissioner Goehrung and Mayor Stiff; those voting No, none.
Building Inspection Division report for August 1988
City Manager Wysocki submitted to the Commission the Building Inspection Division report
for the month of August 1988. He then indicated that was the only item normally found under
the consent items and recommended that the Commission acknowledge receipt of the report and
order it be fi led.
It was moved by Commissioner Vant Hull, seconded by Commissioner Martel, that the Com- I
mission acknowledge receipt of the Building I nspection Division report for August 1988 and order
it be filed. The motion carried by the following Aye and No vote: those voting Aye being Com-
missioner Vant Hull, Commissioner Martel, Commissioner Goehrung, Commissioner Hawks and
Mayor Stiff; those voting No, none.
Discussion - FYI Items
City Manager Wysocki presented to the Commission the following "For Your Information"
items.
09-12-88
413
(1 ) Water use report for the week ending September 7, 1988.
The City Manager noted that the weekend snow in the mountains may alleviate some of the
extreme fire danger; however, it did not significantly increase the water supply. He then in-
dicated that the amount of water remaining at Hyalite Reservoir is over 1,200 acre feet; and, as
a result, the staff will consider lifting of the watering restrictions after return from the League
Convention next week.
I (2) A memo from Clerk of the Commission dated September 9, 1988 indicating the staff
will conduct a tour of the Lyman Creek drainage for the Commissioners at 10:00 a.m. on Wednes-
day, September 21.
All Commissioners expressed an interest in attending this tour.
(3) A letter from Planning Director Epple dated September 7, 1988, along with a copy
of the minutes from the joint PCC/TAC meeting held on August 23, 1988.
(4 ) City Manager Wysocki announced that Planning Director Epple will serve as Acting
City Manager on Wednesday and Thursday; and someone else will serve on Friday, while he
attends the MLCT Conference in Kalispell.
(5) The City Manager distributed to the Commission an information sheet on flag eti-
quette. He indicated that someone has expressed concern about the City flying its flags at
night; and that issue is addressed in this information.
(6) Commissioner Goehrung stated he attended an orientation session for the Leader-
ship Bozeman program and will attend the first seminar on Thursday, September 15. He briefly
reviewed the topics to be covered, indicating he will submit pertinent information to the Com-
mission.
(7) Commissioner Vant Hull indicated she had distributed copies of a memo concerning
her discussion with Animal Control Officer Connie Lien about dog licensing fees. She suggested
this memo could provide useful background information for future discussions on the increasing
of I icense fees.
(8) Commissioner Hawks noted that one of the suggested goals for the upcoming year
I which did not receive adequate votes to appear on the final list of goals was that the City con-
sider purchase of used equipment. He suggested the staff may wish to consider this method of
acquiring needed equipment and other items.
Executive Session re collective bargaining
At 3:30 p.m., Mayor Stiff called an executive session of the Commission for the purpose
of discussing collective bargaining, and requested that all persons except the Commissioners,
City Manager Wysocki, City Attorney Becker and the Clerk leave the room.
At 4:00 p.m., Mayor Stiff closed the executive session of the Commission and reconvened
the open meeting.
Adjournment - 4:00 p.m.
There being no further business to come before the Commission at this time, it was moved
by Commissioner Martel, seconded by Commissioner Goehrung, that the meeting be adjourned.
The motion carried by the following Aye and No vote: those voting Aye being Commissioner
Martel, Commissioner Goehrung, Commissioner Hawks, Commissioner Vant Hull and Mayor Stiff;
those voting No, none.
ALFRED M. STIFF, Mayor
I ATTEST:
ROBIN L. SULLIVAN
Clerk of the Commission
09-12-88