Commission Accepts $500K Grant for Water Main Replacement

IRONWOOD, MI - Monday, July 26, 2010 - The Ironwood City Commission held their second Regular Meeting of the month this evening in the Commission Chambers on the second floor of the Ironwood Memorial Building. The meeting took place following a Public Hearing to hear comment on an Ordinance to amend the "Code of Ordinances" by adding Section 9-9 entitled "Perpetual Care Grant Match Fund." This amendment to the Ordinance would allow a portion of the perpetual care funds to be used as a source for matching grant funds within the City.

At 5:20 PM Mayor Bob Burchell called the Public Hearing to order. Burchell immediately turned the floor over to City Manager Scott Erickson so that he could give a brief overview of the proposed ordinance.

A copy of the proposed Ordinance was displayed on the Commission's newly installed HDTV monitor. Erickson explained that there were two sections to the ordinance, 9.8 and 9.9. He told the Commission that two basic changes were made to section 9-8 (underlined and italicized below) that simply referenced the newly added section 9.9.

He went on to say that section 9.9 was also changed to reflect concerns previously addressed in reviewing the proposed ordinance. Section 9.9 basically outlines the procedure that would be used to determine if a given project had enough merit to warrant the use of the funds as matching funds for a grant application.

The section also allows the Commission to establish the terms of use of the funds and appropriate plan for repayment. Erickson told the Commission that the City Attorney, Dennis Cossi, has reviewed the document and made the appropriate changes to the language.

Mr. Cossi told the Commission that, after talking to the City Treasurer, the funds are actually City funds so using the term "loan" isn't accurate when referring to using the perpetual funds. Cossi said, "Another way of looking at this is that we are reducing the perpetual care fund and setting the terms for the use."

"I just want to make it clear," Cossi said, "One of the things that we added to this is nothing in that new section of the amendment should be construed to mean that there is no requirement of the City to provide perpetual care." Cossi went on to explain that he discovered while researching the matter that there is no requirement of the City to maintain a perpetual care fund. He said, however, that an agreement to provide such care must be honored. Cossi told the Commission that the City could repeal the entire ordinance -- and not have a perpetual care fund -- but still provide perpetual care.

Cossi explained that the amount of money in the perpetual care fund, based on the interest income the fund provides, is not adequate to pay for the required care, so for years, the City has been "kicking in" the additional funds needed.

None of the Commissioners had questions or comments on the matter, so Mayor Burchell opened up the floor to the members of the audience. The only citizen wishing to address the Commission was LeRoy Johnson.

"Considering the changes that you've made so far," Johnson told the Commission, "I would suggest that you remove section 9.9 and leave it the way it is. The other sections regard the user charges. Those fees can only be imposed on those individuals actually served. So you're using perpetual care money for another purpose. 'Rates and charges must bear a direct relationship to the cost of providing the service to the rate payer.' Each and every plot owner has a contract with the City of Ironwood. Mr. Cossi indicated that the City cannot relieve its obligation for perpetual care. That's right! Once you obligate yourself to it you have to supply it!"

Johnson continued, "'Revenues derived from the user charges or assessments must be segregated from other municipal funds.' The upper paragraph, the one that should be amended now, that paragraph or that section was re-added in there so that you are supposed to keep those funds segregated from other municipal funds. 'And can only be solely applied to the expense of providing the service. Section 9.9 is providing and additional use for your perpetual care funds.' When you establish an ordinance, 'no ordinance shall relate to more than one subject and that subject shall be clearly stated in its title.' You have more than one subject. Section 9.9 is an additional subject, unrelated to the cemetery. It's for grant moneys -- to use moneys for grant moneys -- unrelated to the cemetery ordinance, and clearly not proper!"

"What it does, is makes the user fees a tax. So every person who opens a lot and pays the user fee for perpetual care is now being taxed! Now, Michigan Law says, 'burial lots are exempt from taxation.' Even your City Ordinance says that -- they're exempt from taxation! So you can't use perpetual care funds as a tax. It has to be obligated only to what it's intended for -- that's for perpetual care. Now, this is going on for 9 weeks, or 6 or seven weeks, and brought back and forth. Mr. Mayor, since this Ordinance is on its third public hearing can you provide the public with a Constitutional Section or State Statute that merely allows the City Commission to use perpetual care funds in this manner?"

Mayor Burchell explained that he felt comfortable with the legal review and legal opinion provided by the City Attorney.

Johnson asked if the Mayor had a written legal opinion by the attorney.

Burchell responded, "I have what I'm comfortable with!"

After checking to see if there were any other public comments, the Commission voted to close the Public Hearing. There was a two minute recess prior to the start of the regular meeting.

ROUTINE BUSINESS

A. Call Regular Meeting to Order - At 5:30 PM, Mayor Burchell called the Regular Meeting to Order. He recited the Opening Prayer and led the audience in the Pledge of Allegiance.

B. Recording of the Roll - City Clerk Karen Gullan recorded the roll. Three of the five Commissioners were in attendance: Gemma Lamb; Bob Burchell; and Rick Semo. The other two Commissioners - Kim Corcoran and Will Lucius - were excused. City staff on hand included: City Clerk Karen Gullan; City Manager Scott Erickson; City Attorney Dennis Cossi; DPW Working Foreman Joe Magdziak; Utilities Director Bob Tervonen; City Assessor/Building Inspector Dennis Hewitt; and IPSD Sergeant Ron Carpendo. Reporting the meeting were Ralph Ansami and yours truly.

C. Approval of the Consent Agenda - * All items with an asterisk (*) are considered to be routine by the City Commission and will be enacted by one motion. There will be no separate discussion of those items unless a Commission member or citizen so requests, in which event the item will be removed from the General Order of Business and considered in its normal sequence on the agenda. *1) Approval of Minutes – July 12th Regular City Commission Meeting. *2) Review and Place on File. a) Ironwood Planning Commission Meeting Minutes of June 2nd. - Citizen Don Maki asked that the word "trail" be changed to "park" in the minutes presented of the last City Commission meeting. The Commission unanimously approved the Consent Agenda including the amended change to the Minutes.

D. Approval of the Agenda - The Commission unanimously approved the Agenda.

E. Citizens wishing to address the Commission on Items on the Agenda. (Three Minute Limit) - No citizens expressed an interest in addressing the Commission on Agenda items.

NEW BUSINESS

F. Discuss and Consider approving acceptance of the 2009 CDBG Housing Grant agreement in the amount of $243,900 and authorize Mayor to sign appropriate documents - After a brief description of the agreement by Scott Erickson, the Commission unanimously approved the acceptance of the CDBG Housing Grant agreement.

G. Discuss and Consider approving acceptance of the Amendment to Grant #NSP- 2008-0072-CFR and authorize Mayor to sign appropriate documents - Without discussion, the Commission unanimously approved acceptance of the Amendment, and authorized the Mayor to sign the appropriate documents.

H. Discuss and Consider approving acceptance of Michigan Strategic Fund Block Grant (CDBG) in the amount of $500,000 for water transmission main replacement and authorize appropriate signature on the grant agreement - After a brief explanation by Scott Erickson, the Commission unanimously approved acceptance of the MSFBG (CDBG) grant in the amount of $500,000.

I. Receive bids for the Norrie/Jessieville – Water/Sewer Project - Phase II (Aurora Utility Project) - Scott Erickson told the Commission that there were nine bidders for Phase II of the Norrie/Jessieville Water/Sewer Project. He said the low bidder was Wagner Construction in the amount of $7,498,925.30. He explained that the bids were very competitive. Coleman Engineering is reviewing the bids so the Commission wasn't asked to yet to accept any bid. Erickson anticipated that a recommendation from Coleman will be presented in a couple of weeks. He pointed out to the Commission which areas were assigned to each of the two phases on the project map. He pointed out that Phase II is a much bigger project that Phase I.

Rick Semo asked the City Manager how the bids compared between to the two phases of the project. Erickson said Phase I came in under the estimates and Phase II came in slightly over. He said even though it is two separate projects, there is only one funding source, so Rural Development will work with the contractors to make adjustments. Erickson anticipates that a street or two will be removed from Phase II and moved over to Phase I to balance the funding.

The Commission voted unanimously to receive the bids as presented.

J. Discuss and Consider declaring designated city property as surplus property and authorize advertisement for bids - After examining the surplus property list and map, and after considerable discussion on the matter, the Commission voted unanimously to declare the designated property as surplus and authorized advertisement for bids. The Commission opted to place properties marked #16, #17, and #26 on "hold," however.

K. Mayor’s Appointments - Mayor Bob Burchell re-appointed Eva Smith-Furgason to the Downtown Ironwood Development Authority (DIDA). He also filled three additional empty seats on the Authority. He explained that his decision was a very difficult one, and that all of the seven applicants to the Authority were extremely qualified to serve. The Mayor appointed the following three new applicants to the DIDA: Lee-Ann Garske (Coleman Engineering); Matt Weber (Old World Meats); and Tom Williams (R.T. Williams Agency).

Rick Semo told Burchell that he had a very difficult job choosing between the applicants because all of them would have been an asset to the DIDA, but with that said, he made a motion to accept the Mayor's appointments to the Authority. Gemma Lamb seconded the motion and the Commission voted unanimously to approve the Mayor's appointments.

L. Manager’s Report - City Manager Scott Erickson briefly touched on the following in his report to the Commission:

Congratulations and thanks to the organizers and volunteers of Festival Ironwood. Erickson said the event went very well this year, especially considering it almost didn't happen. Erickson stressed the importance of the event and mentioned two individuals who "stepped up to the plate" to make the Festival happen. He expressed his gratitude to Keith Johnson and Will Corcoran and all the volunteers.
Erickson touched briefly on the Water/Sewer project and he pointed out that a map of the streets involved is available on the City's website. He explained that a meeting took place to explain the process to people living in the affected areas and that the meeting went well. Erickson indicated that work on the project will begin tomorrow (July 27th) on Mill Street. He said the work will begin in the southwesterly portion of the project and continue to the northeast. Erickson indicated that communication will be open and ongoing with residents of the project area.
The City Clerk's office will be open on Saturday, July 31, 2010, from 8:00 AM until 2:00 PM to accept absentee ballots for the upcoming election on Tuesday, August 3, 2010.
MDOT has indicated that bids have been awarded for the overlay project to Mathey Construction for Lake Street from US-2 to Margaret Street. Construction should begin by the end of August or the beginning of September.
MDOT will also be overlaying US-2 along Cloverland Drive around the same time.
Erickson explained that the City DPW has received some new equipment and that the DPW Director Joe Magdziak parked the equipment in the back of the Memorial Building for public display. (See photos below.)

M. Other Matters (Five Minute Limit) - Rick Semo said he would like the City to formally thank the organizers of the Festival Ironwood. He said it was a great event and he applauds those who voluntarily took on the project.

Mayor Burchell pointed out that Keith Johnson was in the audience and he thanked him for his help. Johnson indicated that it was a lot of work, but it was well worth it, and he said, contrary to rumors circulating, the Festival will continue next year, and hopefully for years to come.

Burchell indicated that he had names of people who expressed interest in helping out next year. Johnson asked him to take their names and send them over to him.

Burchell told the Commission that he got an invitation from an individual who lived along the ATV/Snowmobile trail to come to his house to receive his input on trail. City Attorney warned Burchell that no more than two Commissioners could attend at the same time to avoid an Open Meetings Act violation.

N. Citizens wishing to address the Commission on Items not on the Agenda (Five Minute Limit) - The following citizens addressed the Commission:

Don Maki told the Commission that there is a group of "non-special interest" people called the citizens of Ironwood who voted the Commission into office. He explained that there wouldn't be trails in the caves if it wasn't for ATVs and snowmobiles. Maki said the Friends of the MMHP took a "step backwards" by trying to keep ATVs out of the caves. Maki suggested that the Commission consider a Miners Heritage ATV/Snowmobile Trail Head Park. He noted that such a park would draw much needed tourism to Ironwood. He explained that much money would be spend on gas, parts, food and lodging.

"Let the walking people have their trail," Maki said, "Let them cut trails by permit, staying off the ATV trails, except to cross them. Leave the 'Caves' zoned open. At 167 acres, normal swamp land is going for $1,000 an acre for $167,000 value -- sell the parcels and get the property on the tax rolls."

Maki went on to say that he rode his ATV in the area Saturday and that he walked some of the trails. He pointed out that there was an unsafe, unsigned, open mine shaft behind the City garage that needed to be inspected. Scott Erickson said he would contact the mine inspector to have it examined.

Mayor Buchell answered Maki's comments by stating that the Friends of the MMHP have stepped up to be the responsible party for the non-motorized trails and park. He said no such group has stepped forward to take responsibility for the motorized use of the area.

Greg Pisani told the Commission that the GRTA is an organized group. He explained they get funding from the State and from the MDNR. He told the Commission that the GRTA simply came before the Commission to have a route through the caves area to get to the ATV/Snowmobile trail system. Pisani said the Commission is composed of MMHP people and that is a big part of the problem. He pointed out that Will Lucius abstained from voting at the last meeting because his law firm was doing legal work for the Friends of the MMHP. Lucius said there would be a conflict of interest. Pisani suggested that several of the Commissioners should have abstained because of their ties to the MMHP.

Pisani went on to say that on August 10, 2009, the City Commission approved use of ATVs in the caves area. He held up a copy taken from the Daily Globe and said, "It's right here in the paper!" He went on to say that the Commission has repeatedly stated that ATVs in the caves were illegal. He said the Commission approved the use by 3 to 2 vote.

EDITOR'S NOTE: On August 10, 2009, Commissioner Suzanne Toth made a motion to legally open up the caves area to motorized off-road vehicles. The Commission voted 3-2 to allow motorized vehicles throughout the area. Gemma Lamb and Bob Burchell voted against the motion. The Commission voted to create a Resolution to allow ATV use in the caves. According to State law, an Ordinance is required to allow ATV use on City land, and all trails used must be designated.

Bob Burchell explained that Resolution passed by the Commission was ill-advised and it wasn't on the agenda. Cossi pointed out that there are no approved routes to the trail.

Burchell explained to Pisani the difference between an Ordinance and a Resolution and the Resolution didn't take into account details like: how people would get to the caves without violating the law; who would install signage; and who would maintain the trail. Burchell explained to Pisani what the Commission's goal was. He said the Commission wants safe, orderly access to the trails and they want to insure the residents along the trails that dust control (which is a major issue to residents along the trail) is in place. Burchell said without having dust control, it wouldn't be fair to the residents along the trail to approve the trail.

Burchell explained that dust control was promised by June, and it never happened. Burchell pointed out that no applications were made to the State to have dust control along the trail.

Pisani told Burchell that he was at most of the meetings and the problem was that the DNR needed a letter from the Commission saying that the trail would be a multi-use trail. Pisani said the letter had to say that the trail use would be guaranteed for five years.

Burchell informed Pisani that he called man who approves such trails -- Ron Yesney in Marquette. According to Yesney, copies of the City Commission minutes would have been acceptable to obtain approval. He also indicated to Burchell that there was no time limit as presented to the Commission. Burchell asked Yesney if a "dust control provision" could be implemented as a condition of approval. Yesney said it could have been added.

Pisani warned the Commission that many local businesses rely on income generated by ATVs and snowmobiles. Burchell agreed that snowmobiles definitely impact the area economy, but he was uncertain of the true impact of ATVs. Pisani reminded Burchell of the 2,000 participants in the ATV Rally in Hurley. Burchell questioned the impact of that rally to Ironwood. Pisani told the Commission that many people who enjoy motorized sports feel unwelcome in Ironwood because word was out that Ironwood was anti-ATV and anti-snowmobile.

Burchell said the main issue with the ATV trails is dust control, and that the Commission needs to be sensitive to residents along the trail. Pisani said he understood because of the dust raised near the fairgrounds.

Before giving up the floor, Pisani asked if certain things could be included on the agenda, such as names of candidates and positions applied for under "Mayor's appointments" and also lists and/or descriptions of property being considered to be designated as "surplus." Burchell indicated that much of that information is available on the City's website, or can be obtained prior to the meeting by contacting the City Clerk.

O. Adjournment - Since there was no further comments from citizens, the meeting was adjourned.