Councilmembers present: Alan Kiest, Carolyn Armanini, Dwight Thompson, Mary Jane Goss, Nate Herzog, Roger Olstad

Councilmember excused: Ed Sterner

Staff present: David R. Hutchinson, Mayor, Douglas Jacobson, City Administrator; Michael Ruark, City Attorney; Dennis Peterson, Police Chief; John Hawley, Finance Director; Ty Peterson, City Planner; Susan Stine, City Clerk; Evelyn Jahed, Deputy City Clerk

Others present: Six visitors

Mayor Hutchinson called the regular meeting to order at 7:32 p.m.

Hutchinson reported on recent events and topics of interest to the council. He discussed the change to commission status of the economic development committee and the proposed confirmation process.

In response to questions from Cmbr. Kiest and Cmbr. Armanini, City Administrator Jacobson discussed the recent letter to residents in unsewered areas and the proposal from Northshore Utility District for a sewer extension.

Kiest asked that Ordinance 861/Amending Gambling Regulations be taken first on the first reading calendar since he must leave the meeting by 9 p.m.

Jacobson requested an executive session of approximately 15 minutes to discuss real estate matters and noted that Mr. Peter Folkins of New Ventures Group would be available for the discussion.

Kiest moved to excuse Cmbr. Sterner’s absence from the meeting. Armanini seconded. The motion carried unanimously.

There being no objection, the agenda was adopted as amended.

Herzog moved adoption of the consent calendar as follows:

1. July 19, 2001 Council Study Session Minutes
2. July 26, 2001 Council Regular Meeting Minutes
3. August 9, 2001 Finance Committee Report covering Warrant Nos. 39806 through 39881in the amount of $132,057.58 drawn from the Claims Clearing Fund and Warrant Nos. 21205 through 21282 in the amount of $146,639.81 drawn from the Payroll Clearing Fund.

Armanini moved to amend the July 26, 2001 minutes as follows:

Page 4, line 4: "Kiest reported on solid waste issues discussed by the Solid Waste Regional Policy Committee."

Hutchinson said he recommends exploring the possibility of amending the gambling regulations to allow mini-casinos. In addition to the information provided in the summary, he noted that income to the city, the possibility of replacing the adult entertainment business, and the potential reduction in law enforcement costs should be included when considering the proposed amendments.

In response to a question from Cmbr. Thompson, Cmbr. Herzog said he is the proponent for the proposal on the council.

Armanini noted that the proposed amendments do not restrict gambling to a particular location but were written to apply to the entire city.

Herzog said the issue of amending the gambling ordinance has been anticipated for some time. He noted the loss of revenue due to recent initiatives and said that this provides an opportunity for a new revenue source. He noted that since the state has authorized mini-casinos and nearby cities allow such businesses, Lake Forest Park could reap the revenue that is currently going to other cities if this proposal is adopted.

Kiest requested that the council be provided an amended summary and a revised ordinance prior to the next council discussion of the ordinance.

Herzog said that he and the mayor have discussed the public process and propose that a public hearing be scheduled for September 13, 2001.

Armanini said she believed that scheduling the public hearing for the first meeting in September would be premature. She said the schedule should allow for information to be provided in the city newsletter including notice of the public hearing.

In response to a question from Thompson, Hutchinson said he is certain that the proposal for the Déjà Vu site is solid financially following his meeting with the proponents.

Armanini noted her concern that the issue of zoning limitations was not identified in the information provided.

Herzog said staff members have been directed to prepare a potential zoning ordinance as well as financial calculations regarding potential revenue.

Armanini also noted that an analysis of the costs to the city and input from adjacent cities regarding their experience would be important to the council discussion.

Kiest recommended that the Municipal Research Services Center be consulted regarding language of the proposed ordinance.

Goss noted that there are more issues related to this proposal than meet the eye and expressed her interest in information on traffic impacts and costs to the city.

Olstad noted that this is a major issue and has the potential for changing the culture of the city. He said that citizens should be very actively involved in the discussion.

Kiest moved adoption of Resolution 634/Appointing City Clerk as City’s Agent for Receiving Claims for Damages. Olstad seconded. The motion carried unanimously.

Armanini moved to advance Resolution 635/Authorize Mayor to Sign Contract for On-Call Development Review Services with Berryman & Henigar to the August 23, 2001 council agenda second reading calendar. Thompson seconded. The motion carried unanimously.

Armanini moved to advance Resolution 636/Authorize Mayor to Sign Contract for Critical Areas Review Services with Shannon & Wilson to the August 23, 2001 council agenda second reading calendar. Thompson seconded. The motion carried unanimously.

Armanini moved to advance Resolution 637/Adopting City Petty Cash Policies to the second reading calendar. Goss seconded. The motion carried unanimously.

Armanini moved to advance Resolution 638/Adopting an Alternative Process for Awarding Small Works Projects Under $35,000 to the second reading calendar. Olstad seconded. The motion carried unanimously.

Thomspon moved to table Ordinance 861/Amending Gambling Regulations to the October 11, 2001 council meeting agenda. Armanini seconded. The motion carried unanimously.

Jacobson reviewed issues discussed at the July 26, 2001 council meeting at which the council authorized the mayor to negotiate a listing agreement with New Ventures Group.

Councilmembers discussed the marketing plan attached to the agreement, termination and compensation.

Following discussion, Thompson moved to amend the listing agreement as follows:

"The New Ventures Group marketing plan for interim city hall attached hereto is incorporated into the listing agreement."

A five-minute recess was taken at 8:30 p.m.

The meeting was resumed at 8:38 p.m.

Goss moved to amend the listing agreement as follows:

Page 2, Line 51 (insert): "...property. This contract may be cancelled by either party with or without cause upon thirty days’ written notice to the other party."

Kiest moved adoption of Resolution 631/Authorizing Mayor to Sign Listing Agreement for Interim City Hall Property Sale as amended. Armanini seconded. The motion carried unanimously.

Armanini moved to amend Resolution 637/Adopting City Petty Cash Policies as follows:

Page 1, line 26: "...purchases that has have to be handled on a cash basis."

Page 2, line 1: "...shall not exceed the monthly salary of the custodian."

Page 2, line 5: "...is periodically counted and reconciled at least quarterly..."

Kiest moved to add language to prohibit the use of the petty cash fund to cash employee checks. Thompson seconded. The motion carried unanimously.

Armanini moved to place Resolution 637/Adopting City Petty Cash Policies on the August 23, 2001 council agenda for second reading and final action. Kiest seconded. The motion carried unanimously.

Following discussion of the intent of the proposed resolution, Armanini moved to place Resolution 638/Adopting an Alternative Process for Awarding Small Works Projects Under $35,000 on the August 23, 2001 council agenda second reading calendar.

Kiest requested that an article on marine patrol be copied for council and the city administrator.

At 8:59 p.m., Hutchinson noted that the next item on the agenda is an executive session of approximately 15 minutes for discussion of real estate matters. Those not required to participate in the executive session exited the council chambers at this time.

A five-minute recess was called for at 9 p.m.

The meeting was resumed at 9:04 p.m.

The meeting was recessed to executive session at 9:05 p.m. for approximately 15 minutes for discussion of real estate matters.

The meeting was resumed at 9:27 p.m.

Goss moved to authorize the mayor to sign an agreement with New Ventures Group listing the Interim City Hall property for sale at $2,450,000. Olstad seconded. The motion carried unanimously.

There being no objection, the meeting was adjourned at 9:28 p.m.

Susan Stine, City Clerk

APPROVED:

David R. Hutchinson, Mayor