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HomeMy WebLinkAbout2005-08-08 Minutes, City Commission MINUTES OF THE MEETING OF THE CITY COMMISSION BOZEMAN, MONTANA August 8, 2005 ***************************** The Commission of the City of Bozeman met in special session in the Community Room, Gallatin County Courthouse, 311 West Main Street, on Monday, August 8, 2005, at 5:30 p.m. Present were Mayor Andrew Cetraro, Commissioner Jeff Krauss, Commissioner Marcia Youngman, Commissioner Steve Kirchhoff, Commissioner Lee Hietala, City Manager Chris Kukulski, Assistant City Manager Ron Brey, Director of Public Service Debbie Arkell, Director of Finance Anna Rosenberry, City Attorney Paul Luwe and City Clerk Robin Sullivan. Sianina of Notice of Special Meetina Each of the Commissioners, in turn, signed the Notice of Special Meeting. Executive session ~ Dersonnel At 5:30 p.m., Mayor Cetraro announced that, pursuant to Section 2-3-203(3), Montana Code Annotated, the Montana Constitution and the Montana Supreme Court rulings, he, as presiding officer, has determined that the right to privacy clearly exceeds the merits of public disclosure and announced that the employees have not waived their right to privacy. He then called an executive session for the purpose of evaluating the City Manager and the City Clerk and requested that all persons except the Commissioners and the Clerk leave the room. At 6:30 p.m., Mayor Cetraro closed the executive session and reconvened the open meeting. Break M 6:30 o.m. to 7:00 p.m. Mayor Cetraro declared a break from 6:30 p.m. to 7:00 p.m., to prepare for the open portion of this special meeting. Call to Order and Moment of Silence The meeting was opened with the Pledge of Allegiance and a moment of silence. Public comment Mr. Dave Pruitt, member of the board for the Solid Waste District, gave a brief overview of that board's duties, which include management of the Logan landfill. He noted the district was proposed by the County Commissioners, with the intent being to serve all of the citizens of Gallatin County. The district was subsequently created and includes all of Gallatin County less the city of Belgrade, the city of Bozeman, and the Hegben Lake area. The Board of Directors is comprised of one appointee from each city within the district, one County Commissioner and two from the county at large. The board is as close to autonomous as possible, but does use county services for payroll, personnel, revenues and expenditures. He stressed that no tax dollars support this district; rather, the tipping fee at the landfill is its only source of revenue. The Solid Waste District assumed management of the Logan landfill on July 1, 2004 and is looking at different options for handling of a variety of waste products. He concluded by stating the offer still stands for the City of Bozeman to use the Logan landfill, either through a contract or through joining the District, in which case it would have two seats on the Board. 08-08-05 special - 2 - Mr. John Sinrud distributed a set of plans for the Springhill Car Wash, expressing concern that the rules have changed near the end of this project. He noted the original plan, with a few minor modifications, met the guidelines set forth in the unified development ordinance in place during the review process. On July 22, after the July 5 approval by the City Commission, he received a new set of guidelines with new landscape requirements. This change in guidelines has resulted in an increase of 30 trees and bushes on what is an extremely tight site. He asked that the Commission provide guidance to the staff on this issue. Mr. Mitch Billis, Bridger Bubbles, noted that the original plan for this site, which is the smallest one within the development, included 35 trees and bushes; it now contains 53 trees and bushes to meet code requirements. He compared this to the Blue Basket site, which has 12 trees. He stressed the importance of not crowding trees, but giving them space to grow and an environment that does not completely hide the car wash. He noted there will be a rock wall around the perimeter of the site, and the building is designed to fit with the other buildings in the subdivision. Mr. Frank Munshower, 1407 South Bozeman Avenue, noted he is Chair of the Bozeman Creek Neighborhood Association. He voiced concern about the monstrosity of a power pole being erected at the corner of South Rouse Avenue and East Lincoln Street as part of NorthWestern Energy's upgrading of the substation and power lines. He noted that NorthWestern Energy maintains the new line is for local energy distribution; however, the map shows that those lines actually progess to Livingston. He reported that last week, an appeal of the Planning Director's decision was filed; however, NorthWestern Energy has refused to voluntarily halt construction until the appeal is resolved. He concluded by asking that the Commission enforce its own regulations. Authorize City Manaaer to neaotiate aareement for develoDment and first year administration of cable television franchise agreement City Manager Kukulski reminded the Commission that this issue has been previously discussed, beginning at the July 5 meeting and then in subsequent work sessions. He noted that since that time, there have been communications with Mike Oswald, Bresnan Communications, and additional information from Doug Johnson, Tel-Mart, Inc. He stated that information points out both pros and cons of franchise agreements. He concluded by asking that the Commission authorize him to negotiate an agreement with Tel-Mart, Inc., to assist the City with negotiating a franchise agreement with Bresnan Communications. Mr. Mike Oswald, Bresnan Communications, noted that he had submitted a letter to the Commission earlier today. He then stated he feels the City and Bresnan can work together and provide a public access channel that does not result in increased rates to the consumer. He expressed an openness to talking about the specifics and negotiating in good faith with the City. He turned his attention to Mr. Johnson's letter, stating that no jobs have been lost in Bozeman; in fact, the Bozeman office will remain open and positions are being added. In addition, Bresnan is investing in its infrastructure in Bozeman and launching new products and is willing to dedicate a channel to Bozeman for its use. Mr. Doug Johnson, Tel-Mart, Inc., stated that a franchise agreement merely defines the relationship between the City and the cable television operator. Every other major city in Montana and most minor cities have had franchise agreements with their cable television providers for fifteen to twenty years. He concluded by noting that Mr. Oswald represents the interests of the cable company; he would represent the interests of the City. Commission Youngman voiced appreciation for Bresnan's offer, which would allow for broadcast of Commission meetings. She stressed, however, that a franchise agreement would allow for the broadcast of in-depth information on specific issues, such as solid waste. She noted that the Commission has discussed various alternatives for getting new information out to the public, and with the technology available, she believes public access television would be a good resource; that option would not be available without a franchise agreement. She reminded the Commission that three separate citizen panels have recommended entering into a franchise agreement, which would allow greater access for local programming that includes a range of educational programs on topics ranging from local government to non-profits to arts and culture. Mayor Cetraro noted the letter from Bresnan Communications provides an innovative way to reach the public. He then voiced his support for negotiating directly with Bresnan. 08-08-05 special - 3 - Commissioner Hietala expressed his interest in pursuing an agreement with Bresnan Communications that results in no increased costs to either the City or the customers but provides for local access to a channel. He suggested that channel could be used to inform the public about various issues, such as the school bond issue, the jail bond issue, new wastewater treatment plant and street improvements. He noted that the Bresnan offer comes with equipment and personnel and he feels that is an appropriate start. Commissioner Krauss stated he has not had time to assimilate the new information from Bresnan Communications. He then noted that he is uncomfortable with directing staff to negotiate a contract for a service on which they have no expertise; however, he is also hesitant about spending money to negotiate a contract when there's a substantial offer on the table. In light of his concerns, he suggested one alternative might be to authorize staff to meet with the consultant and come back with a proposal. City Manager Kukulski identified the issue as being to what extent the City wishes to utilize a public access channel. He noted that when discussions began several months ago, it was with the intent to televise Commission meetings. The request was originally made to Bresnan Communications, and there was no response. Since a consultant has come forward with a proposal to negotiate on behalf of the City, Bresnan has come to the table and offered to provide certain services. He stated that, if the Commission wishes to pursue a more full-fledged communication channel, Mr. Johnson's expertise would be invaluable in the negotiations; if the Commission wishes only to have its meetings televised, he does not believe a consultant is needed to negotiate the agreement. He concluded by reminding the Commission that the agreement will be placed on a future agenda for action. Commissioner Youngman stated the Commission has previously adopted a list of items it wanted included in a franchise agreement, based on recommendations from the cable television franchising committee. She recognized that, with changing technology and circumstances, the list needs to be updated. She stressed that, under a franchise agreement, the City may set whatever level of fee it wishes, not necessarily the maximum fee allows; and that would have only a small impact on ratepayers. She stressed, however, that it is important to enter into a franchise agreement to ensure the desired services are provided. Commissioner Krauss stated he is not interested in spending $40,000 on consultant services to negotiate an agreement, although he would support a small consultant fee if the City Manager is not comfortable negotiating an agreement. It was moved by Commissioner Krauss, seconded by Commissioner Youngman, that the Commission authorize the City Manager to negotiate an agreement with Tel-Mart, Inc., in an amount not to exceed $25,000,for development and first year administration of a cable television franchise agreement on behalf of the City, with the agreement to be placed on an upcoming agenda for Commission consideration. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Krauss, Commissioner Youngman and Commissioner Kirchhoff; those voting No being Commissioner Hietala and Mayor Cetraro. Commission Resolution No. 3832 M adootina core values for the City of Bozeman Included in the Commissioners' packets was a copy of Commission Resolution No. 3832, entitled: COMMISSION RESOLUTION NO. 3832 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, ADOPTING THE CORE VALUES OF THE CITY OF BOZEMAN, AS IDENTIFIED BY ITS EMPLOYEES AND COMMISSIONERS AND ENCOURAGING ALL EMPLOYEES AND COMMISSIONERS TO PERSONALLY ADOPT THESE CORE VALUES AND PERFORM THEIR DUTIES IN COMPLIANCE WITH THEM. City Manager Kukulski reminded the Commission that establishing core values of the City has been a ten-month process that has engaged as many City employees as possible. He reviewed the core values that have resulted from the process, which include integrity, leadership, service and teamwork. He noted the setting of these core values and their utilization will provide an excellent foundation for running the organization and recommended that this resolution be adopted. 08-08-05 special ----- ---------- - 4- It was moved by Commissioner Youngman, seconded by Commissioner Kirchhoff, that Commission Resolution No. 3832, adopting core values of the City, be adopted. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Youngman, Commissioner Kirchhoff, Commissioner Hietala, Commissioner Krauss and Mayor Cetraro; those voting No, none. Review of seven Dossible scenarios for future solid collection and disoosal activities Included in the Commissioners' packets were a memo providing a supplement to the memo dated July 11 and the draft minutes from the work session held on July 18. Also, distributed in the packets and just prior to the meeting were communications from several residents providing input on the issue. City Manager Chris Kukulski observed that staff is providing information on which the Commission may base its decision. He noted that staff has identified six options and provided information on each of them; and a seventh option has spun out of those listed. Director of Public Service Debbie Arkell noted that at the July 18 meeting, staff received direction to pursue liquidating the City's assets and contracting with a private company for solid waste collection and disposal services. She stated that during preparation of the memo, issues and questions encountered include provisions in the Teamsters contract and exclusive hauler rights issues. She noted that in 2000, Damschen and Associates determined the existing cell would last three to six years and, at that time, the Commission was encouraged to determine how solid waste was to be handled in the future. The least expensive option was to expand the existi ng landfi II, the second least expensive was the construct a transfer station at the existing landfill. The Commission voted to not open a new cell and to pursue a transfer station somewhere other than at the landfill. The City has subsequently purchased the Mandeville Farm for $2.6 million, recognizing the potential that it might house other City services and that parcels may be sold for commercial or industrial uses. The Director of Public Service reminded the Commission of the six scenarios discussed at the July 18 meeting, which include: (1) construct transfer station as bid; (2) redesign and rebid transfer station; (3) direct haul to Logan using City packer trucks; (4) use a sub-transfer station and haul to Logan; (5)open new cell at existing landfill; and (6) privatize solid waste collection, disposal and recycling services. At that time, the option to liquidate City assets and contract with a private company was added to the list of scenarios. The Director noted that several underlying issues have been identified, stating that the landfill is projected to reach capacity in Spring 2006. The Solid Waste Fund has a cash reserve for closing of the landfill, per Department of Environmental Quality requirements; however, the Fund also has an additional reserve. The City owns 86 acres at the Mandeville Farm site and 200 acres at the existing landfill; and approximately 100 acres of that existing site could be used for other purposes. The Director stated that approximately 18 percent of solid waste is currently recycled, with the current budget including $360,000 for recycling. The City contributes $35,000 to the Headwaters Recycling Program. She cautioned that some mechanism for funding of that program must be identified, since it has been supported by the solid waste disposal fees; and that source will be eliminated with closing of the landfill. Options include a surcharge on all loads taken to the transfer station or a recycling charge on the monthly utility bills. She then turned her attention to the disposal options, which include use of City services, contracting with BFI or self-hauling. With closure of the landfill and the attendant requirement to haul to Logan, staff is concerned about the potential of illegal burning and/or dumping. Director of Public Service Arkell highlighted the options that have been identified. She noted that construction of the transfer station is the staff-recommended option. The transfer station is designed to last twenty years and serve a population of 80,000. Even with the cash on hand in the Solid Waste Fund, which is projected at $6.1 million at the end of Fiscal Year 2006, approximately $2.5 million will need to be borrowed. The result would be a significant increase in tipping fees, from the current $36 per ton to an estimated $60 to $73 per ton. The second option is to redesign the transfer station and rebid it. That option might save monies in the short term but will cost as much or more with the need for future additions. The third option is to direct haul to the Logan landfill, which will take approximately two hours with the City's packer trucks. She cautioned that collection rates will need to be increased approximately 20 percent to cover those costs of travel and maintenance. She indicated that the fourth option is to build a small-scale sub-transfer station at the existing landfill, noting that the Department of Environmental Quality has given preliminary approval for a temporary station to operate between closure of the landfill and opening of a 08-08-05 special - 5 - transfer station. The site would include transfer trailers that could be hauled to Logan, with the tipping fee for that site estimated at $55 per ton and collection rates to be increased by 10 percent. The fifth option would be opening of a new cell at the landfill, at an estimated cost of $4 million for a 20-acre cell. Because of the cell's location uphill from Churn Creek, there is the potential for contamination of the creek. The sixth option is to discontinue services and liquidate assets. In July, the Commissioners suggested a revision to that option that would include entering into a contract with a private company to provide collection services in conjunction with the City liquidating its assets. At the July 18 Commission meeting, a representative from BFI indicated the company could provide all services that the City does and offered to continue the multiple rate structure that the City currently uses. That contract would also include allowing annual rate increases limited to the CPI unless approved by the Commission, citizen drop-off sites, recycling drop-off sites, continued assistance with the Headwaters Recycling program, support of community events and a drop-off for street sweepings. The representative from BFI requested that the contract be for a minimum of ten years with an option for a ten-year renewal. Since the City has not invoked exclusive hauling rights, no tightly regulated monopoly could be implemented for a period of five years. The Director stressed that under this option, the City would continue to have costs for post-closure monitoring. Ms. Kaaren Jacobson, 1110 South Third Avenue, acknowledged that the idea of privatizing services is always seductive because it is assumed business "does it better". She cautioned however, that studies find that the public sector actually does better at providing the services. She noted there must be competition to assure the highest level of success with the program. She then stressed that, if the City is to enter into a contract for the services, it must be clear and specific; and the City must have experienced contract writers and contract monitors to ensure its administration. Further, performance measures must be identified, data collection provisions implemented, and consequences for inadequate services and violations invoked. She concluded by asking if the community wants a giant garbage conglomerate entangled in local government. Ms. Thail Davis, Downtown Bozeman Partnership, noted that over the past nine years, BFI has provided gratis garbage pick-up services for the downtown in a faithful and reliable manner. The company has also provided trash totes for special events in the downtown area. Mr. Roger Koopman noted that he personally believes private sector can provide services cheaper, better and faster. In a perfect world, he noted Option 6 would be the best option; however, he cautioned that the Public Service Commission makes it extremely difficult for competition to exist. He provided the Commission with copies of an article entitled This Way Up, which discusses garbage collection services where competition is available. In this instance, he stated that deregulation of solid waste collection makes no more sense than deregulation of electricity and asked that the City maintain free entry to the market and competition. Ms. Betty Strook stated she owns two properties along Story Mill Road. She pleaded that, whatever option the City chooses, use of the existing landfill be taken off the table. She noted the neighborhood is changing, and it is no longer an appropriate location for solid waste disposal. Mr. Derek Homan, 356 Greenway Court, noted that if business is downsized because of financial constraints, it is usually the bad performers that are eliminated; in this instance, solid waste is a good performer. He questioned what happens if the City contracts with a company that then goes bankrupt. The also asked if the disposal of this activity is being considered to fund an overplanned and underfunded library. He encouraged the Commission to accept the staffs recommendation, particularly since all of the other options have so many negatives. Ms. Debra DeBode, 527 North Montana Avenue, noted that as of today, the City had petitions containing 1,048 signatures in opposition to privatization of garbage services. She noted that petition raises nine points for Commission consideration. Mr. Don Derby stressed that construction of the proposed transfer station can be completed with a small percentage of debt being incurred. He cautioned that if hauling to Logan is required, the landfill will begin at city limits and extend to Logan. He also noted that the recycling program will probably be eliminated. In addition, taxpayers will incur additional costs because the City, Gallatin County and the Montana Department of Highways will be required to haul leaves, street sweepings and dead animals to Logan. He voiced his support for the construction of a transfer sation, noting that monies in the Solid Waste Fund should remain in that fund rather than being used for other City operations. 08-08-05 special - 6- Mr. Jerry Calvert, 111 Heritage Drive, stated he is satisfied with current services by the City. He urged the Commission to not make a decision until after the new Commissioners have been seated and staff has had an opportunity to gather extensive information about the costs and benefits of privatizing garbage collection in a city of similar size and growth potential. He is concerned about the appearance of a rush to make a decision, particularly for a well-liked public service. He concluded by stating there is no justifiable reason to turn an effective City department into a private monopoly. Ms. Shirley Elliott, 1133 Cherry Drive, stated that prior attempts to put certain public needs in private hands have failed at preat expense to the public. She stressed that this is not just an issue of garbage collection, but one 0 public health and safety, for which local government is responsible. She then encouraged the Commission to accept the staffs expertise and recommendation and avoid the potential problems that might arise from dissolving a City service in a non-competitive situation. Mr. Matt McKennan, 2910 Donna Avenue, encouraged the Commission to privatize its waste services, noting it will result in a $10 million infusion into the City's coffers. He noted that he currently contracts with BFI and is pleased with their service. He is concerned about the possible increased costs if the City remains in the business, stating he feels they are excessive. Mr. Bill McKell, 305 Lindley Place, noted he is from New Jersey, "where garbage is big business, and contracts and rate hikes mean nothing." He urged the Commission not to rush into the possibility of privatization, noting that people move in and out of those companies. He compared that to the City, where employees make this a career and do their work well for little thanks. He stated that a conversation with friends in Missoula, where BFI is the provider, reveal they are not happy with the service. He concluded by asking that the City retain its services. Mr. Tim Gazy, Chair of the Bozeman Area Chamber of Commerce, stated it is the Chamber's opinion that the issues revolve around the financial burden that businesses and residents may assume with the construction of a transfer station. He noted the City does not have financial footing to assume millions of dollars in debt, particularly when looking at $45 million in needed water and sewer infrastructure improvements as well as the shortfall in the new library project. He noted that private enterprise stays in business through efficiencies in delivery of goods and services, and questioned whether the City would be able to do so without serious repercussions. Mr. Kelly Wood, 918 Woodland Drive, noted that during his college days, he paid $4.98 for telephone service; those costs have now risen to $42 and include local calls only. He noted this is an example of a well regulated monopoly. He then stressed the importance of looking at the profile of this fast growing community and county in making its decision. He asked that, if the Commission does choose Option 7, it maximize the value of the real estate it has acquired and rezone the property to make sure that this area of the community "looks like a front porch." Mr. Anson Crutcher stated that he has represented solid waste disposal companies and cities in conversion of services over three decades. He noted that he is now retired and offered his services to the City, to identify potential problems and how they can resolved. He observed that a franchise can work, with administrative charges imposed and the Commission sitting as the Public Service Commission. He stressed that the deregulation of public utilities has not worked, but that a franchise can. He stressed that the biggest issue to consider is jobs for existing City employees, income and retirement, which are items that can be wrapped into the franchise agreement. Also, he suggested the contract be for not more than ten years, with a option for renewal after five years of operation. Mr. Stu Levitt, 701 North Montana Avenue, urged the Commission to not accept BFl's offer to provide solid waste collection services. He raised the issue of Harry Kirschenbaum, representative of BFI, withdrawing from the 2004 City Commission race and then assisting Commissioner Jeff Krauss with his campaign. He characterized this proposal as a $10 million carrot offered by a power hungry business that would become a monopoly. He noted that a city with garbage collection services provides security and confidence for its residents. He asked the Commission to not rush through the process. Commissioner Krauss responded to the previous testimony and recent letters in the Bozeman Daily Chronicle by stating that he has no personal or private interest in any garbage company and that Mr. Kirschenbaum served in no official capacity on his campaign for City Commission. He asked that the publiC avoid political posturing and personal attacks but concentrate on the provision of solid waste services. He 08-08-05 special - 7 - concluded by stating that a review of the issues with the City Attorney has revealed no impropriety and noting that he will continue to be involved in the issue. Mr. Charles Bowen, 3070 Mcllhattan Road, stated he owns the property to the north of the existing landfill. He encouraged the Commission to accept the staffs recommendation for construction of a transfer station, noting that this issue has been the subject of extensive public hearings and consultant evaluation and assistance. He reminded the Commission that in 1995, the City received a consultant recommendation to close the landfill; and the City has subsequently gone through a series of steps to reach this point. He noted that the Mandeville site was selected as the best site for the transfer station, and stressed that the existing landfill was not in the top three. He concluded by voicing surprise that any additional use of the landfill is being considered and suggested that the City obtain appraisals on both properties. Ms. Jane Jelinski, 433 North Tracy Avenue, noted solid waste services are one of Bozeman's most successful, and a well-run enterprise fund. She noted that the com posting program is effective and efficient; the recycling program is a model; alley clean-up is one of the City's best services; and the hazardous waste collection program protects the water. She cautioned that once the City enters into a contract and liquidates its assets, it is at the mercy of a private corporation. She encouraged the City to not abandon this efficient service but to accept the recommendation from staff. Ms. Charlotte Trollin~er, 533 North Montana Avenue, stated that deregulation and privatization are proving to be bad options. he noted that garbage collection is a necessary aspect of contemporary life and a service that requires regulation. She urged the City to retain its solid waste collection services. Mr. Tom Woodson, 407 West Harrison Street, stated he has "produced garbage there for quite some time." He noted that just last week, the ravens strewed the garbage about; and the City worker got out and cleaned up the mess. He questioned how well a private company would provide such service, since their motivation is efficiency and not service. He noted that he is angered every time he receives his electricity bill, noting residents were "sold a bill of goods" when deregulation was introduced. He concluded by acknowledging that the transfer station is a tough call, but encouraged the City to remain in the business. Mr. Ron Dingman, 215 Wilda Lane, stated he works for the City. He encouraged the Commission to look at how efficiently the City's solid waste services are operated and how clean and well run the landfill is. He noted that in his 25 years of working for the City, he has worked with a number of contractors and crews and has found that contractors have no incentive to do good work. He concluded by asking that these services not be privatized. Mr. Rob Tallon, Executive Director of Reach, Inc., noted he has enjoyed a good relationship with BFI, who has provided approximately $35,000 in services to his agency. He asked the Commissioners to separate emotion from facts and to recognize that BFI "is not the evil empire." Mr. Cort Felts, Manager of Sachs, stated his board has not taken action. He noted that their organization relies on donations and the waiving of tipping fees at the landfill to fund their programs; and his organization works proactively to reduce the amount taken to the landfill. The staff at Sachs believes construction of a transfer station is the best option and that it would be appropriate for non-profit organizations to pay some fees at the facility, phased in over a period of time. He concluded by stating that privatization of solid waste services is not good for his agency or the community as a whole. He also noted that Mr. Kirschenbaum has publicly worked on the campaigns for Commissioners Krauss, Hietala and Cetraro and questioned how the Commission can, in good faith, act on this issue. At Commissioner Krauss's request, City Attorney Luwe addressed the issue, stating he has reviewed the information provided by Commissioner Krauss and found no conflict. Mrs. Joannie Peterson, 27383 Frontage Road, expressed concern about the negative impact that construction of a transfer station and shop complex would have on this area. She recognized that garbage is a lucrative business and questioned why the City should leave its employees in the cold. She encouraged the City to not construct those facilities but to rezone the area to residential in this entryway to the community, where the first impression is a lasting one. She concluded by encouraging the Commission to save the monies it would cost to construct a transfer station. Mr. Dane Gamble, Manager of Bridger Creek Golf Course, noted that construction of a transfer station has been the subject to extensive review and public input, and it now appears the process is being 08-08-05 special -8- jetisoned. He noted the financial analysis reveals the solid waste services and transfer station are on very solid footing. He urged the Commission to seriously consider Option 1, and noted that any consideration of land issues should be separate from this discussion. Ms. Erica Skinger, 815 North 7th Avenue, voiced concern about potential impacts on low-income people living in mobile homes. She stressed that, if the City chooses to no longer remain in the solid waste collection business, it is important that intense monitoring be provided to ensure the community does not encounter exposure to hazardous wastes. Ms. Laura Smith, 1711 South 11 th Avenue, stated she is a member of the Recycling Club at MSU. She stated that, she has witnessed more recycling on campus and in the community over the past few years and she is concerned that if BFI assumed oversight of recycling, there would be less recycling. She noted that when Recycle It went out of business, she contacted BFI and was informed that it was not profitable and that the program should be reconsidered. She indicated that the Recycling Club has been able to continue its program by working with Headwaters Recycling and urged the Commission to carefully consider this program. Mr. Dan Kaveney, 630 East Davis Street, urged the Commission to accept the recommendation from staff and proceed with the transfer station. He noted that benefit from privatization can be realized only with real competition; and government oversight is no substitute for that competition. He then noted the current system works and questioned the need to consider changing it. He concluded by asking the Commission to slow down and asked if the potential privatization has been bid nationally and suggesting that citizens be compensated for risks involved with a change. Mrs. Sally Christie, 1015 East Griffin Drive, noted that BFI is an ambitious company. She asked what happens when there is no competition and who will hold them accountable. She suggested that rates will not be competitive in the future. She then noted that her husband has been a loyal employee of the City's solid waste program for 17 years, and many other families will be negatively impacted if the Commission chooses to eliminate this program. She concluded by asking that, as elected officials, the Commissioners not let ambition get in the way of honor. Mr. Bob Nichol, 1615 South Black Avenue, stated that he obtained 75 signatures on a petition in one hour, with only one person, who had previously worked for BFI, expressing support for privatization. He noted that comments he received included the observation that, if the can is filled above the lid, BFI will not dump it. He also noted that one individual responsible for overseeing contracts for the City of Seattle stated that he found BFI to be the poorest company with which the City contracted. He concluded by urging the Commissioners to consider options other than privatization. Mr. Dave Osterman, 2210 Highland Court, noted he owns businesses in both Bozeman and Belgrade. He stated that he has 4-yard containers for both, and he pays $400 in Belgrade and $82 in Bozeman per month. He noted that, even if the City doubles its collection fees, he'll be paying half what he does with the private company. Mr. Jeff Nojek, 220 South Black Avenue, stated he has found City services flawless for the past 2~ years, watching City personnel pick up debris. He noted that corporate entities want to make profit, which is not a bad thing; however, the constant temptation is to cut services and cut corners to maximize profits. He urged the Commission to not privatize services but to retain the existing system. Mr. Kevin Handelin, 375 Greenway Court, noted that indirect costs include the cost of driving from the collection route to the landfill; and the difference in distance between the City's landfill and the Logan landfill is 43 mile. He then stated that at 13 miles per gallon for the 16,000 vehicles that pass through the landfill's gates, the result will be $446,000 spent on fuel at today's costs. He stressed that, in addition, there are wear and tear on the vehicle and blowing debris along the interstate. He encouraged the Commission to proceed with Option 1 and to keep the garbage collection and recycling services. Mr. Cedrick Hollewijn, 1410 South Montana Avenue, suggested that opening a second cell at the landfill may be a good option, noting that by the time that cell is full, technology may had advanced to the point that garbage is no longer an issue. He then agreed that the City's collection service is excellent, noting that the employees recognize they are in the "people service" business and that they are truly friendly and service oriented even though they recognize it is not a glorious job. He asked the Commission to not privatize the service but to leave it as it is. 08-08-05 special -9- Ms. Deb Stober, 395 Valley Drive, noted that, as a resident of GaUatin County, BFI has provided her service for many years. She stated that their drivers have also picked up blown trash and dumped excess trash, providing the same service for which the City employees have been complimented. She is concerned that a transfer station will result in increased collection fees, particularly if BFI is required to dump there. Mr. Rob Green stated he picks up trash. He noted the City employees do a good job, servicing their customers well and efficiently while developing "a little pot of gold at the end of the rainbow" for the City. He noted sadly that the only way to get to that pot of gold now is to kill the rainbow. He then reminded the Commission that six years ago, there were two private haulers; now there is only one because it bought out the other company. If the City were to get out of the collection business, there would be no competition, and he caution that would not work. He concluded by stating he-tooks forward to going to work every day, noting that at the end of the day he knows "I left this world a better place because I picked up your trash." Ms. Mary Vant Hull, 416 East Story Street, read a letter from Jeff Ball into the record. In that letter, Mr. Ball stated he supports the coalition of cities buying NorthWestern Energy; and the move to sell the City's solid waste services flies in the face of the move to add electricity to the services provided. He cautioned that rate payers will lose voice and rate increases will be inevitable. He noted that the City has wonderful employees and good facilities and observed that monopolies don't work. He then concluded by quoting the old saying "if it ain't broke, don't fix it." Mr. Jon Gerster, 719 North Wallace Avenue, noted the City hired consultants several years ago and then appointed a task force to assist with evaluating various sites for a transfer station. It is now the eleventh hours, and he questioned why the City should now go back to the beginning of a five-year process. He noted that, with most of the money available'to cover the costs of constructing the transfer station, only a small bridge loan is needed to complete the project. Hethen turned his attention to the political issues, cautioning that perception is reality particularly when conflict of interest issues arise. He concluded by voicing his support for Option 1. Mr. Rich Noonan, 115 West Cleveland Street, encouraged theCommissioners to not be "penny wise and pound foolish" and voice support for Option 1. Mr Chris Nixon, 719 North Wallace Avenue, stated he was on the task force that reviewed various sites. He noted the big issue at that time was the need for a transfer station rather than direct hauling to Logan. He stressed that privatizing the solid waste services does~not eliminate the need for a transfer station, so the community will still be paying for the facility: , Break M 9:42 o.m. to 9:50 o.m. Mayor Cetraro declared a break from 9:42 p.m. to 9:50 p.m., in accordance with Commission policy. Review of seven Dossible scenarios for future solid collection and disoosal activities (continued) Mayor Cetraro asked that the Commission narrow the field of scenarios being considered by eliminating those they least support. Commissioner Krauss expressed interest in eliminating the options of opening a new cell at the landfill and a small scale sub-transfer station at the landfill. Commissioner Youngman expressed her support for eliminating the new cell, noting that the small scale sub~transfer station was to simply be a temporary measure, not a permanent solution. Commissioner Kirchhoff suggested that all options but Option 1 be eliminated. Commissioner Youngman suggested that, through the use of value engineering, some of the costs of the transfer station could be eliminated without negatively impacting the structural integrity of the project or its appearance. She also noted that sale of portions of the Mandeville Farm or the existing landfill site could generate enough monies, thus eliminating the need to borrow monies or shortening the time for repayment. 08-08-05 special - 10 - Commissioner Hietala noted that several months ago, he asked if the transfer station could be scaled back and the response was negative. He then voiced concern about the lack of credibility in this process. Mayor Cetraro noted that, with Option 1, there is a potential deficit of $600,000 a year. He noted that, ifthe City proceeds with the transfer station, the next step is to require everyone to haul to that location, and he is not comfortable in setting that requirement. Commissioner Youngman acknowledged the concerns voiced by Commissioner Hietala and Mayor Cetraro. In light of those concerns, she suggested that more in-depth review of the direct haul options could be considered as an alternative to the transfer station. She encouraged the Commissioners to recognize the manner in which all City departments could be affected by privatization of the solid waste services. She noted those items may include the administrative fees paid to other funds and the collection and disposal services provided to other departments at no cost. She cautioned that those costs could add up to $10 million in a few short years if the City were to eliminate its department. Commissioner Kirchhoff observed that the Commission has not discussed the option of getting out of the solid waste business, even when the issue of citing a transfer station was initially proposed. He suggested that a transfer station has many benefits, including a gain in efficiencies, increased recycling, compost opportunities, and a location for dropping of white goods and hazardous materials. The benefit is an increase in the amount of waste diverted from the landfill. He characterized this option as not a cost increaser but a service level maintainer. He concluded by stating his support for continuing to provide the great service that the City has done for the past fifty years. Commissioner Hietala noted the City generates approximately 15,000 tons of the 66,000 tons of waste taken to the landfill, which is a small percentage of the total. He then noted that BFI contributes the lion's share of waste and, if steps are not taken to preclude BFI hauling directly to Logan, rates at the transfer station will be double or possibly triple the current projections. Commissioner Krauss noted recent experience with the new library has revealed one cannot engineer down fast enough to beat the increase in construction costs. He then stated that when the transfer station was estimated to cost $3 million and $4 million, he supported the project. He noted, however, that the bids are substantially higher than that and, as a result, he finds it imperative to research other alternatives. City Manager Kukulski suggested the design/bid/build program now available to local governments can potentially cut 15 to 30 percent off the costs of a project. He cautioned that, to take advantage of that process, the old process must be terminated and a new one begun. He stressed that much of the high cost of the project is due to its size and its location within the entryway corridor and the need for substantial site work. He then turned his attention to the proposal to add a fee to the utility bill for recycling, reminding the Commission that that bill includes water, sewer and garbage collection services at the present time. Commissioner Krauss responded by suggesting that the recycling program be funded through the General Fund, where it would compete with all other priorities in the City. He does not, however, support including a charge for recycling on the utility bill. Commissioner Youngman expressed her interest in adding a recycling fee to the tipping fee at the transfer station, noting that the result would be more equitable because County residents would then be helping to bear the costs of a program that they use. Commissioner Krauss turned his attention to the staff analysis in Option 3, noting he cannot accept the projection that the trucks will last only three years if used for direct hauling. Commissioner Krauss noted that another company can get a PSC license if there is a demonstrated need for the service. He indicated that, in analyzing the various options, he feels additional information is needed. That includes reducing costs of the transfer station, operating the transfer station without flow control, and how recycling is to be funded and handled. He believes a request for proposals should be done to determine if that is a viable alternative. He proposed that following two tracks at this time will allow the Commission to rationally consider the options without speculation. 08-08-05 special -11 - Responding to Commissioner Kirchhoff, Commissioner Krauss observed that if one finds a "bridge out" sign, one takes a detour or investigates an alternate route. In this instance, he does not support flow control or placing a charge for recycling on the utility bill; and he does not feel staff analysis of equipment needs for direct hauling is accurate. He is further concerned about the speculation of what a private company might bid and he feels that information is needed to make a good, informed decision. Responding to Commissioner Youngman, Commissioner Krauss stated his major goals are preserving competition and finding ways to preserve the programs everyone values, including composting and recycling. He likes the idea of including county residents in the funding of those programs, since they use those services as well as city residents. He then noted that a request for proposals has not yet been issued and suggested that a nationwide search might generate'some interesting proposals. Commissioner Youngman noted that when more than one private hauler has operated in Bozeman, the larger company has bought the smaller company out, thus eliminating its competition. She stated the Wastewater Treatment Plant is faced with federal rule changes that require a change in how sludge is handled, and that could possibly become part of the composting operation and result in a highly enhanced product. She also cautioned that the operations of several other departments cross over, and those operations must be carefully considered. She addressed the costs of monitoring a contract, noting they average more than 20 percent of the revenues and can result in the hiring of an expensive consultant or additional personnel, particularly in a market where there is no competition. Further, if service points are missed in the contract, the result is reduced service and loss of community values. She suggested that, if staff is asked to provide additional information, it include successes and failures of privatized garbage services in other communities of this size and growth, examples of the best and worst services, problems with contracts, and expense to the consumers. She asked that this information be provided before completing a request for proposals, to ensure that pitfalls are avoided. Commissioner Kirchhoff recognized that privatization would result in a reduction in staff size, thus saving money; however, he stated he does not want to become' a regulatory agency to get a company to "play nice". He then noted no one has convinced him that the solid waste division needs to be sold. Commissioner Youngman questioned why, after receiving the second largest petition from the community, the Commission is considering elimination of Option 1. City Manager Kukulski cautioned that if not all haulers are mandated to use the transfer station, the result would be the loss of $600,000 in revenues that were used in calculating the proposed tipping fees, Director of Finance Anna Rosenberry noted that a $60 tipping fee is the break even point based on 54,000 tons of garbage. She stated that, to reach that tonnage, the City, self-haulers and BFI must use the transfer station. If flow control is not invoked, the tipping fee VIIOUld be significantly higher. City Manager Kukulski suggested that other haulers in. the region may consider using the City's transfer station, citing the Park County/Livingston area as an example. Assistant City Manager Ron Srey cautioned that, if flow control is not imposed and the price differential between City service and BFI is great, the City may lose some of its customers. Given the variables, staff cannot provide specifics, but various scenarios omy. Commissioner Krauss suggested that a graph showing the sliding break even point could be beneficial information. Commissioner Youngman noted the current Commission can make the decisions; however, she cautioned that the transfer station will not be constructed until after the new Commission has been seated. She then suggested the Commission may wish to consider becoming part of the solid waste district again, which may have some impact on how the transfer station operates. Commissioner Kirchhoff suggested that the City may choose to dispose of its garbage in another location. He then voiced his preference for retaining City services rather than "fretting over a regrettable increase in cost" resulting from having a single private hauler. Responding to Commissioner Kirchhoff, Commissioner Krauss stated the monies from sale of the solid waste division would not be used for the library. He then stated he is interested in investigating 08-08-05 special - 12 - different break even points and the possibility of dropping the cost of the transfer station but does not wish to pursue flow control at this time. He is also concerned about the potential of raising rates to BFI customers. Commissioner Hietala stated he feels direct haul to the Logan landfill would be the cheapest option. City Manager Kukulski suggested that competing head to head may be the best way to protect services and encourage good rates. Commissioner Krauss stated he does not find there is a need to hurry on this issue and noted his interest in carefully investigating it before making a decision. Commissioner Kirchhoff noted the figures suggest that the City may continue to provide a great service while its charges remain in the middle of the pack for Montana. Commissioner Youngman suggested that, if bidders are asked to extend the effective dates of their bids for the transfer station, the decision could be delayed for thirty days without eliminating any of the options. It was moved by Commissioner Krauss, seconded by Commissioner Youngman, that the decision on this issue be delayed, in conjunction with extension of the bids for the transfer station, to give staff and the Commission an opportunity to investigate Option No.1 combined with Option Nos. 2, 3 and 7, as will as estimates of costs, revenue streams and other issues that may be identified. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Krauss, Commissioner Hietala and Mayor Cetraro; those voting No being Commissioner Youngman and Commissioner Kirchhoff. Review of draft reauest for orooosals for oossible disoosal of solid waste services Included in the Commissioners' packets was a draft request for proposals to liquidate current solid waste assets and enter into a contract with a private hauler. It was moved by Commissioner Krauss, seconded by Commissioner Youngman, that action on the draft request for proposals be delayed until the decision has been made on the previous agenda item. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Krauss, Commissioner Youngman, Commissioner Kirchhoff, Commissioner Hietala and Mayor Cetraro; those voting No, none. Reauest to bidders on transfer station to extend sixtvMdav review oeriod orior to award of bid Project Engineer Dustin Johnson stated he has spoken to the top three bidders about extending their bids; and they have agreed to a 30-day extension but not the requested 60-dayextension. He noted their major concerns about the 60-day extension are the cost fluctuations for materials and scheduling of their labor forces. He stated that a 60-day delay in award of the bid could mean they would not be able to begin construction until next spring, which could have a dramatic impact on scheduling of the work force. It was moved by Commissioner Krauss, seconded by Commissioner Youngman, that staff be authorized and directed to request a 60-day extension on award of bids, and to accept a shorter extension if necessary. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Krauss, Commissioner Youngman, Commissioner Hietala and Mayor Cetraro; those voting No being Commissioner Kirchhoff. Discussion M FYI Items The following "For Your Information" items were forwarded to the Commission. (1 ) Assistant City Manager Ron Brey announced that the proposed tax increment financing district for the North 7th Avenue corridor will be placed on the August 22 agenda for discussion. 08-08-05 special -13- (2) Commissioner Krauss asked if the Commissioners wish to consider the Recreation and Parks Advisory Board's recommendation to take steps to dedicate Centennial Park; a majority of the Commissioners indicated they were not interested in pursuing the issue. Adjournment M 11:12 o.m. There being no further business to come before the Commission at this time, it was moved by Commissioner Kirchhoff, seconded by Commissioner Hietala, that the meeting be adjourned. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Kirchhoff, Commissioner Hietala, Commissioner Krauss, Commissioner Youngman ~ d M~ )r Cetraro; those voting No, none. ~ I ~ - - I ----~ .... ANDR~ L. a TRARO, Mayor ATTEST: ~.z~ R N L. SULLIVAN City Clerk 08-08-05 special