City Council Minutes

Thursday, June 17,2004



ST. GEORGE CITY COUNCIL MINUTES
REGULAR MEETING
JUNE 17, 2004, 4:00 P.M.
CITY COUNCIL CHAMBERS

PRESENT:
Mayor Daniel D. McArthur
Council Member Rod Orton
Council Member Larry Gardner
Council Member Bob Whatcott
Council Member Suzanne Allen
Council Member Gail Bunker
City Manager Gary Esplin
Deputy City Attorney Ron Read
City Recorder Gay Cragun

OPENING:
Mayor McArthur called the meeting to order and welcomed all in attendance. The pledge of allegiance was led by Scout Trent Nielson, and the invocation was offered by Pastor Marc Trujillo of the Oasis Community Church.

Mayor McArthur invited several Scouts in the audience to introduce themselves.

Mayor McArthur commented that he attended a breakfast at the Social Hall in recognition of Public Works employees and their many years of service.

UPDATE ON POWER OUTAGE:
City Manager Gary Esplin explained that the recent power outage was caused by fires in the Dammeron Valley area which heated the main transmission line from Central and eventually shut it down. Two Utah Power and Lights structures were burned, and the City will switch UP&L on to its system so that UP&L can make repairs to its system.

Fire Marshall Kevin Taylor explained that several residents from Brookside were evacuated, but no homes were destroyed and there had not been any injuries. Crews provided by St. George were used for protection of homes. 25 volunteers and eight pieces of equipment from St. George were used to battle the fires, and Washington City was put on stand-by if back-up was needed in St. George.

CONSERVATION UPDATE:
Conservation Coordinator Ren? Fleming explained that two weeks ago the City Council instituted mandatory water restrictions, and since then water usage has dropped from 35,000,000 gallons per day to 26,000,000 - 30,000,000 gallons per day. She encouraged citizens to continue to conserve water. She explained that the drought management policy is specifically limited to culinary water. Power peaks have dropped with the recent cooler weather, but it is anticipated that it will rise with the temperatures.

CONSENT CALENDAR:
Consider approval of the financial report for May, 2004.

City Manager Gary Esplin commented that the City was in great fiscal shape.

MOTION: A motion was made by Council Member Orton to approve the financial statement as presented.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

BID OPENING:
Consider approval of a change order to the Highland Drive Phase I project.

City Manager Gary Esplin explained that the first phase was completed, but there was a misunderstanding by the project engineer, and this item should have been brought before the City Council previously for approval. The project is complete and under budget.

MOTION: A motion was made by Council Member Gardner to approve the change order.

SECOND: The motion was seconded by Council Member Orton

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

RESOLUTION:
Consider approval of a resolution abandoning the north 10 feet of a public utility and drainage easement located in Canyon Court, Phase II (Laurelwood).

City Manager Gary Esplin explained that the applicants requested abandonment of ten feet on the north and south, but the Joint Utilities Committee recommended that only the north ten feet be abandoned.

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June 17, 2004
Page Two

MOTION: A motion was made by Council Member Gardner to approve the resolution abandoning the north ten feet only.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Gardner - aye
Council Member Allen - aye
Council Member Bunker - aye
Council Member Whatcott - aye
Council Member Orton - aye

The vote was unanimous and the motion carried.

RESOLUTION:
Consider approval of a resolution abandoning a public utility and drainage easement located between Lots 21 and 22 of the Castle Rock Subdivision.

City Manager Gary Esplin explained that the applicant would like to combine two lots in order to build a larger home.

MOTION: A motion was made by Council Member Whatcott to approve the resolution.

SECOND: The motion was seconded by Council Member Bunker.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Whatcott - aye
Council Member Bunker - aye

Council Member Orton - aye
Council Member Allen - aye
Council Member Gardner - aye

The vote was unanimous and the motion carried.

LOCAL CONSENT FOR LIQUOR LICENSE/BEER LICENSE:
Consider approval of local consent for a restaurant liquor license and approval of a beer license for Famous Dave?s BBQ. Roger Dee Johnson, applicant.

City Manager Gary Esplin commented that the application appeared to be in order and met the requirements of the ordinance. Staff recommends approval.

MOTION: A motion was made by Council Member Whatcott to approve the beer license and local consent for a restaurant liquor license.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

A representative of Dave?s Famous BBQ explained that this will be the fourth restaurant in Utah and will open a week from Monday.

Roger Johnson, General Manager, explained that Dave?s smokes all its own meats.

AIRPORT LEASE:
Consider approval of a non-commercial hangar lot lease with Basix Financial, LP.

MOTION: A motion was made by Council Member Orton to approve the lease.

SECOND: The motion was seconded by Council Member Gardner.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

SPECIAL EVENT PERMIT:
Consider approval of a special event permit to close part of Main Street for a street festival on July 3, 2004.

Debbie Pazer, Event Coordinator, explained they would like to close Main Street on July 3 from Tabernacle to St. George Blvd. to create a 50's event. Each store along Main Street will be involved with the activities, games, contests, food, etc.



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June 17, 2004
Page Three

Council Member Orton inquired if Ms. Pazer had obtained approval from all businesses on Main Street.

Ms. Pazer replied that all were committed to paying for advertising.

MOTION: A motion to approve the special event permit from 12:00 noon to 10:00 p.m. was made by Council Member Allen.

SECOND: The motion was seconded by Council Member Bunker.

Council Member Whatcott inquired of Ms. Pazer if she would need to close Main Street earlier than 12:00 noon in order to set up. Ms. Pazer replied that she would.

AMENDED MOTION: Council Member Allen amended her motion to approve closure of Main Street beginning at 10:30 a.m.

Council Member Orton inquired of Ms. Pazer if she was working with Zions Bank.

Ms. Pazer replied that she had talked with them, as well as Wells Fargo, and had invited both to participate.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

FINAL PLAT:
Associate Planner Mark Bradley explained that the Planning Commission, at its meeting held June 8, 2004, recommended approval of the final plats for (1) Entrada at Snow Canyon - Chaco Bench Phase 3; and (2) Jedora Estates Phase 3.

MOTION: A motion was made by Council Member Gardner to approve the final plats and authorize the Mayor to sign them.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

STATUS REPORT/HILLSIDE DEVELOPMENT PERMIT:
Associate Planner Mark Bradley explained that Russell Limb requested an extension of his hillside development permit which expires in June, 2004. Mr. Limb feels the project is 30% complete, and he would like an additional one year extension.

Mayor McArthur stated he felt the permit should be extended and suggested the matter be scheduled on another agenda when Mr. Limb could be present to address the City Council.

MODIFICATION TO FEE SCHEDULE:
Consider modifications to the fee schedule for rezones, general plan amendments, and conditional use permits.

City Manager Gary Esplin explained that modifications to the schedule adopted last December were recently discussed concerning the amount of fees charged based on acreage. Staff reviewed fee schedules from many different cities, and recommends that a fee schedule based on a sliding scale, similar to Scottsdale?s fee schedule, be adopted. Community Development Director Bob Nicholson met with representatives of the development community and they feel this is a fair compromise. He recommended approval of the following fees:

General Plan/Rezoning - $500 plus acreage amount for parcels larger than one acre
1-100 acres $50.00 per acre
101-500 acres $25.00 per acre
501+ acres $10.00 per acre

Conditional Use Permit - $300.00

Community Development Director Bob Nicholson explained that Carol Sapp and Rick Rosenberg requested that the City extend the expiration time period on a PD zone to three years if due to no activity, rather than the present 18 month expiration period. Staff supports the change.

MOTION: A motion was made by Council Member Gardner and seconded by Council Member Whatcott to approve the General Plan/Rezoning Fees and Conditional Use Permit Fee as recommended by staff.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

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June 17, 2004
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City Manager Gary Esplin advised that the request to extend the expiration period for PD zones would be brought back to the City Council for a public hearing at a later date.

REQUEST FOR REDUCTION OF ASSESSMENT:
Consider a request for reduction of assessment for property in the Little Valley SID. Teresa Payton, applicant.

Gary Kuhlmann, representing Teresa Payton, explained that the parcels of property involved were split, and while notices were properly mailed, his client did not receive notice. The difficulty began in November, 2002. Ms. Payton received her property by deed as part of a settlement agreement on October 30, and the deed was recorded a week later. The notices sent by the City went to the previous owner. At the time the deed was given to Ms. Payton under the settlement, new tax ID numbers were issued which were significantly different from the old tax ID numbers. A new assessor?s list was not obtained and therefore the change of ownership was not picked up by the City.
When an offer to purchase the property was made by Derrill Larkin, a search was made
which showed no assessment on the property. Based on this, Ms. Payton accepted Mr. Larkin?s offer to purchase. As part of the closing, the title company made a request of the City for assessment information using the new tax ID number, and still no assessment was shown. However, the City Treasurer obtained a map from the title company and by using the map found an assessment on the property of over $30,000. Ms. Payton relied on the previous representation of the City that there was no assessment in accepting Mr. Larkin?s offer, and is now being asked to pay $30,000. This is not the fault of the City as it followed its process. The issue is that the property owned by Ms. Payton has a master planned road across it. The entire piece of property is about five acres and the road takes up about 25% of the property, and it cannot be used for anything but roadway. SID statues restrict assessments to benefit the property. Ms. Payton is requesting as adjustment of $6,171.51 for the roadway property. If the roadway property is not taken into account, Ms. Payton?s assessment is far greater than anyone else?s within the same district, and she will not receive the benefit of her property by the improvements to the same extent as everyone else. He requested that the City allow an offset of $6,171.51 against the assessment.

Deputy City Attorney Ron Read explained that he could not find a legal technicality missed by the City, and it would be a matter of equity if the City Council wanted to consider a reduction in assessment because of the roadway. However, the Engineering Department has never taken a roadway out of acreage assessed unless the road was already there.

Council Member Whatcott commented that the City did not split up the Paytons? property, the Paytons did, and he inquired why the City was now being asked to make up the difference.

Mr. Kuhlmann replied that ths client?s problem was not created by the creation of the split, or not receiving the notice, even though a good faith attempt was made on his client?s part to obtain information on the assessment before accepting the deal with Mr. Larkin. What has caused the problem is all that in conjunction with not sending the final assessment notice from the updated assessment list.

Council Member Whatcott inquired of Mr. Kuhlmann if he was saying that Ms. Payton knew nothing about the assessment. He commented that Mr. Larkin knew about the assessment as he was heavily involved, and everyone in the area knew about it. He stated he was shocked the applicant would insinuate she did not know about the special improvement district.

Mr. Kuhlmann replied that his client is not saying she did not know about the special improvement district, but she did not know the status of the special improvement district or the amount of the assessment, as none of the notices were mailed to her. Mr. Larkin said he knew there was an assessment, but he did not know if it had been paid.

City Manager Gary Esplin inquired how the property was divided without creating a subdivision.

Mr. Kuhlmann replied that his client did not know when the subdivision was created; she received the property as a settlement.

Mr. Esplin explained that according to the City Treasurer, on November 18, 2003 she met with a representative of the Payton family to discuss the assessment. That person was informed at that time that there was an assessment on the property. The City has gone beyond statutory requirements to make property owners aware of assessments. As a courtesy, the City has also provided information on assessments when a tax ID number is provided, but is now being held accountable for accommodating these requests.

Mr. Kuhlmann replied that if the City had instructed the applicant to go to a title company for the information, she would have done so. The settlement received by Ms. Payton is

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June 17, 2004
Page Five

part of a divorce settlement, so any information with regard to the assessment was not relayed back to her. He advised that the property transaction has been done with a conditional closing based on what the City will do.

Council Member Allen commented the conditional closing should be based on what the buyer is going to do, not the City.

Council Member Orton inquired of the applicant if she would have sold her property for the price she did if she had known about the assessment.

Deputy City Attorney Ron Read advised that the seller is bound under the agreement, and $38,000 of the selling price which will go to the SID will be coming from the seller.

Mr. Kuhlmann advised that the buyer has agreed to wait and see what will happen before forcing the sale at that price. It is logical that the City grant the request and allow for the offset without setting a precedent.

City Manager Gary Esplin inquired of Mr. Kuhlmann, as the former City Attorney, if residents have a right to ask for an abatement on an assessment for property on which a road will be located.

Mr. Kuhlmann replied that they would have a right if the road were going in now, and not in 20 years.

Mr. Esplin inquired if they would have a right to ask for an abatement if the road were not going in for three years.

Mr. Kuhlmann replied if they had received notice, no, they would not have the right. Ms. Payton did not have the chance to attend an equalization hearing because she did not receive notice. The problems stems from a combination of not receiving any notice, a change of title, and a good faith attempt to find out if there was an assessment. He stated his client knew there was a special improvement district, but did not know the amount of the assessment.

Deanna Brklacich, City Treasurer, explained that staff tries diligently to maintain its records, and if a title company or the real estate agent had informed the City that the tax ID number had changed, and the City discarded that information, then staff would be more than happy to recommend an adjustment. However, because the City does not know when property is deeded, if it transfers, or is sold or developed, and the County issued a new tax ID number, the City cannot know unless it is brought to its attention.
She spoke with the County and they said they cannot notify the City each time a new property tax ID number is assigned. The only way the City can know is if it is brought to the City?s attention by the buyer or title company. In this case the tax ID number changed significantly.

Mayor McArthur commented that City staff went over and beyond the call of duty.

City Manager Gary Esplin commented that the City has the alternative to not give assessment quotes any longer and let the title companies make an official request. The City gives quotes as a courtesy only.

Deputy City Attorney Ron Read commented that the key is the request was made prior to the title company being involved. The request came from the realtor who knew the tax ID number had been changed, but only sent in the new number. Once the title company became involved and sent the name, tax ID, and legal description, City staff was able to do research and ascertain the assessment. The City does not normally run into a situation where a new tax ID number has been issued.

Council Member Whatcott commented it appeared a protest had been filed by the Paytons on the original parcel.

Deputy City Attorney Ron Read replied the protest was made by the representative of the estate who received the notices according to the assessor?s list at that time.

Ms. Brklacich commented that she received no notice from the Paytons that their property had been split or exchanged.

Deputy City Attorney Ron Read commented that someone was making inquiries about the assessment prior to the time in question, and eight times the City responded to those inquires with the amount of assessment. A month or two later the request with the new tax ID number was received by the City, the City replied that there was no assessment, and the applicant wants to rely on that request.

City Treasurer Deanna Brklacich advised that eight requests were responded to with the correct assessment preceding the incorrect one.

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June 17, 2004
Page Six

MOTION: A motion was made by Council Member Gardner to adjust Ms. Payton?s assessment by $6,171.51.

The motion died for lack of a second.

Council Member Orton commented that the City could not make an adjustment for this roadway unless it was prepared to do so for all roadways and all assessments. He suggested that the matter be tabled for further research. He commented that everyone in the area knew there was a special improvement district.

Council Member Allen commented that the City must be fair to everyone across the board.

Council Member Whatcott commented that roads are a valuable commodity to sell and develop property, and while a road may sometimes have a negative impact, as a general statement they are what gives property its value. In this case, the road bisects the property and the individuals purchasing the property benefit greatly by it through movement from their current development. While no one may be at fault, the applicant is asking the City to pick up the tab. The City did what it was supposed to do, and he felt everyone knew there was an assessment, including the real estate agent.

City Manager Gary Esplin commented that if the City Council desired more input, staff could further research the matter to see if property for any master planned roads were deleted from any assessments. However, a precedent may be set, and the City would have to look at all other assessments. If the applicant?s request was granted, then everyone else?s assessment in that district would go up as it would have to be spread throughout the district. The residents of that district would have to pay the $6,000, not the City, and this is why an allowance for a roadway is not normally made.

Mayor McArthur advised that the matter would be scheduled on the next regular City Council agenda in two weeks.

PUBLIC HEARING/ZONE CHANGE/ORDINANCE:
Public hearing to consider approval of a zone change from A-20 Agricultural to PD Planned Development Residential on 5.35 acres with 21 single family detached homes and OS Open Space on .94 acre located at approximately 2800 South River road. Riley Richardson, applicant.

Community Development Director, Bob Nicholson, explained that the property consists of six acres, five of which are devoted to the residential project, with one acre to open space. The open space area is within the flood plain. The project will consist of 21 detached single level units, with a density of 3.9 units per acre. The units will be stucco with stone on the exterior and tile roofs. The request meets the General Plan requirements, and the Planning Commission recommends approval. The project will consist of private streets, with a privacy wall between it and the adjoining project.

Mayor McArthur opened the public hearing.

Ryan Richardson commented the project will consist of mostly single story units, with a few walk-out basement units. A deceleration lane will be constructed. A crash gate will be installed for emergency access where the project adjoins Desert Sands. The price range will be about $200,000.

A brief discussion took place with regard to hammerheads and their use as turn-arounds.

There being no further public comment, Mayor McArthur closed the public hearing.

MOTION: A motion was made by Council Member Gardner to approve the zone change by ordinance as requested.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Gardner - aye
Council Member Whatcott - aye
Council Member Orton - aye
Council Member Allen - aye
Council Member Bunker - aye

The vote was unanimous and the motion carried.




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June 17, 2004
Page Seven

PUBLIC HEARING/ZONE CHANGE/ORDINANCE:
Public hearing to consider approval of a zone change from A-1 Agricultural to RE-12.5 Residential Estates (12,500 sq. ft. minimum lot size) on 5.1 acres located at 2049 East 2800 South, east of River Road. Gary Rink, applicant.

Community Development Director Bob Nicholson explained that the property backs up to the Knolls Subdivision. The entire area is in transition to smaller lots. The Planning Commission recommends approval.

Mayor McArthur suggested that a notice be attached to the plat advising buyers that the zone is agricultural and allows animals. He then opened the public hearing. There being no public comment, he closed the public hearing.

MOTION: A motion was made by Council Member Gardner to approve the zone change by ordinance as requested.

SECOND: The motion was seconded by Council Member Allen.

CLARIFICATION: Council Member Gardner clarified that his motion included the stipulation that a note be placed on the plat that the project is located within an agricultural zone which allows animals.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Gardner - aye
Council Member Allen - aye
Council Member Bunker - aye
Council Member Whatcott - aye
Council Member Orton - aye

The vote was unanimous and the motion carried.

PUBLIC HEARING/ZONE CHANGE/ORDINANCE:
Public hearing to consider approval of a zone change from MH Mobile Home to R-1-10 Single Family Residential on 39.49 acres located at the northeast corner of 2000 South and 2580 East. Karl Larsen and Russell Bateman, applicants.

Community Development Director Bob Nicholson explained that the request is consistent with the General Plan and the Planning Commission recommends approval.

Mayor McArthur opened the public hearing. There being no public comment, he closed the public hearing.

MOTION: A motion was made by Council Member Orton to approve the zone change by ordinance as requested.

SECOND: The motion was seconded by Council Member Bunker.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Orton - aye
Council Member Bunker - aye
Council Member Allen - aye
Council Member Whatcott - aye
Council Member Gardner - aye

The vote was unanimous and the motion carried.

PUBLIC HEARING/LANDMARK SITE/ORDINANCE:
Public hearing to consider a request to designate the ?Stevens? house at 212 North 100 West as a City Landmark Site.

Community Development Director Bob Nicholson explained that the home is located north of the Brigham Young home and east of the Seven Wives Inn. He suggested that the item be tabled, however, due to a technicality. St. George City Code requires that the owner of the home make application for landmark site designation, and the applicants thought they would be the owners of the home by now, but they are not.

The applicant advised that regardless of landmark site designation, they would purchase the home and restore it.

Deputy City Attorney Ron Read suggested that the public hearing be held, but not closed, and the matter continued until the next meeting.

Mayor McArthur opened the public hearing.

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June 17, 2004
Page Eight

Gloria Shakespeare commented that she was concerned with landmark sites, and the City should consider its criteria, such as what the home can be used for, what changes can be made to it, what laws apply to it, etc. She inquired if the City knew how many landmark sites it had. She suggested that the criteria be considered before any more landmark sites were designated.

City Manager Gary Esplin commented that the criteria for landmark site designation is contained in the ordinance, and this is why each request for landmark site designation is heard by the City Council. If the criteria is too broad, it can be reviewed and amended. He stated that in his opinion there was no question the applicant?s house qualified for landmark site designation. Uses for the site would have to be considered at a future public hearing.

Dorothy Norton commented that a majority of owners of landmark sites specifically want to use the home for commercial uses, and if there was definite criteria with regard to what could be done with the home, there would not be any false expectations.

City Manager Gary Esplin replied that uses of landmark sites are specifically spelled out in the ordinance, such as a bed and breakfast, office, etc.

Ms. Norton replied that what could be done to the outside of the home was not spelled out in the ordinance.

Mayor McArthur commented that perhaps the criteria should be reviewed. However, the Planning Commission denied a request for a landmark site designation for a different home at its last meeting because it did not meet the criteria contained in the ordinance.

Community Development Director Bob Nicholson advised that he would provide a list of landmark sites to the City Council. There are approximately 25 landmark sites currently within the City. The ordinance says that a property owner may receive a return of his investment without detracting from the residential character of the neighborhood or historic building involved. Parking is not allowed in front yards, and the use must be fairly low profile. The use cannot generate a lot of traffic and must fit into the neighborhood. Any change to the appearance or exterior requires a permit from the City Council.

Gloria Shakespeare commented that the landmark site on 100 East has since been made into a bed and breakfast, and there are now several buildings in the back which have no historical significance, yet have been allowed. She commented that parking needed to be considered.

MOTION: A motion was made by Council Member Gardner to continue the public hearing.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

PUBLIC HEARING/LANDMARK SITE/ORDINANCE:
Public hearing to consider a request to designate the ?Pickett? house at 190 South 100 East as a City landmark site.

Community Development Director Bob Nicholson explained that the applicant will come back to the City Council at a later date to request use of the landmark site as a limited medical office. The Historic Preservation Committee recommends approval of the landmark site designation.

Dorothy Norton commented that there was no parking or driveway on the property.

Council Member Bunker commented that the doors on the home did not appear to be historically accurate.

Mr. Nicholson advised that the Historic Preservation Committee unanimously recommended approval.

Gloria Shakespeare commented there is a historical marker in front of the home, and inquired about its significance.

Mr. Nicholson advised that the plaque has no significance other than to inform the public about the home. The City received a grant for placement of historical markers in the area with property owners? permission.

Mayor McArthur opened the public hearing. There being no public comment, he closed the public hearing.


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June 17, 2004
Page Nine

MOTION: A motion was made by Council Member Gardner to approve landmark site designation for the house at 190 South 100 East.

SECOND: The motion was seconded by Council Member Orton.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.


PUBLIC HEARING/ADOPTION OF BUDGET/RESOLUTION:
Public hearing to consider adoption of the 2004-2005 fiscal budget for the City of St. George.

Mayor McArthur opened the public hearing. There being no public comment, he closed the public hearing.

City Manager Gary Esplin explained that this was the first year the City qualified for CDBG funds. It has been determined that 15% of the maximum amount can be allocated to certain types of requests which were reviewed at the last City Council meeting. This means that the City can spend only $82,000 on some of the requests received that would not qualify for other consideration. He suggested that distribution of the CDBG funds be done after a discussion in work meeting. He recommended that $16,000 be allocated for a vehicle in the zoning enforcement department, $100,000 for the tamarack eradication program, and $25,000 in part-time help for spraying. He advised that funds were available to pay for a portion or all of the 12% increase in employee health insurance. There are other requests as well for a new sweeper and other equipment, and for administration of the CDBG program. He explained that funds were included in the budget to match the entire amount of the employee health insurance increase. He advised he was not recommending a market adjustment this year for employees, so matching the health insurance increase would be an opportunity to help those who are frozen at their current salaries as health insurance costs continue to rise each year.

Mayor McArthur commented that private businesses are struggling and not picking up insurance increases for their employees, and the City Council should be careful in using public funds.

It was suggested the matter be continued until after an executive session.

PUBLIC HEARING/AMEND BUDGET/RESOLUTION:
Public hearing to consider adjustments to the 2003-2004 fiscal budget for the City of St. George.

City Manager Gary Esplin reviewed the recommended adjustments to the budget, attached hereto as Exhibit ?A?.

Mayor McArthur opened the public hearing. There being no public comment, he closed the public hearing.

MOTION: A motion was made by Council Member Whatcott to approve the resolution adjusting the budget.

SECOND: The motion was seconded by Council Member Orton.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Whatcott - aye
Council Member Orton - aye
Council Member Gardner - aye
Council Member Bunker - aye
Council Member Allen - aye

The vote was unanimous and the motion carried.

ADJOURN TO REDEVELOPMENT AGENCY MEETING:
MOTION: A motion was made by Council Member Orton to adjourn to a Redevelopment Agency meeting.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

RECONVENE:
MOTION: A motion to reconvene was made by Council Member Whatcott.

SECOND: The motion was seconded by Council Member Allen.


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June 17, 2004
Page Ten

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

Mayor McArthur then called for a five minute break.


APPROVAL OF MINUTES:
Consider approval of the minutes of the regular City Council meeting held May 6, 2004.

MOTION: A motion was made by Council Member Whatcott to approve the minutes as amended.

SECOND: The motion was seconded by Council Member Gardner.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

Consider approval of the minutes of the regular City Council meeting held May 20, 2004.

MOTION: A motion was made by Council Member Whatcott to approve the minutes as presented.

SECOND: The motion was seconded by Council Member Bunker.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

Consider approval of the minutes of the special City Council meeting held May 24, 2004.

MOTION: A motion was made by Council Member Gardner to approve the minutes as presented.

SECOND: The motion was seconded by Council Member Bunker.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

REQUEST FOR REDUCTION IN INTEREST RATE ON NOTE:
Consider a request for reduction in the interest rate charged on a note for the Ft. Pearce Business Park.

City Manager Gary Esplin explained that the current interest rate on the note is 8%. Since then, interest rates have gone down, and the applicants are requesting that the interest rate be lowered to 5.5%. This would be twice the interest rate the City is getting from the treasury pool, however, the applicants are requesting that the reduction in interest rate be backdated to July 1, 2003. Staff recommends that the lowered interest rate be effective July 1, 2004.

MOTION: A motion was made by Council Member Gardner to approve the request and approve the interest rate reduction retroactive to July 1, 2003.

The motion died for lack of a second.

City Manager Gary Esplin explained that money from the loan can be used for economic development incentives for qualified businesses, and would provide more opportunity for the current developers of the park to maximize their profits, if any. Staff?s recommendation is that the interest rate not be backdated to July 1, 2003.

MOTION: A motion was made by Council Member Gardner to approve the reduction of interest date, but not back date it.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

PAYSON POWER POOL APPENDIX:
Consider approval of the Payson Power Project Pool Appendix.

Energy Services Director Phil Solomon explained that the agreement requires that any surplus not taken from the Payson Power Plant has to be dealt with in the pool. The agreement requires a pooling appendix to handle this surplus. The appendix provides a mechanism for power not used to be dumped into the pool. The appendix is based on an all-in cost concept that UAMPS is trying to go to. It could be a good concept, but currently has a lot of problems. Four pages of comments from the City have been sent to UAMPS, and staff has real concerns about how it will work. The appendix was supposed to be adopted at the last UAMPS meeting, but because of St. George?s comments, was not. He

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June 17, 2004
Page Eleven

stated that he did not know if he wanted to recommend approval until all the pool gets approved. If the City has surplus resources it is not using, UAMPS is supposed to buy it all back. Another meeting has been scheduled with UAMPS for June 28.

MOTION: A motion to table this matter was made by Council Member Allen.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

Mr. Solomon then gave a brief report on the status of the fire in Dammeron Valley and its effect on power facilities.

AMENDMENT TO CONTRACT:
Consider approval of an amendment to the contract with Alpha Engineering for the 400 East improvement project.

Kathy Hasfurther, Project Engineer, explained that a year ago the design was approved at a cost of $58,000 and included just the storm drain. Sewer, water and road reconstruction have now been added, and $24,000 additional is needed to pay for this.

City Manager Gary Esplin commented that staff would like to upgrade the water and sewer lines as part of the project so that they do not have to go in later and tear up the street.

Ms. Hasfurther explained that $132,000 will be the total cost for construction management and the additional design.

MOTION: A motion was made by Council Member Orton to approve the amendment.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

Ms. Hasfurther advised that construction would begin on Monday by the I-15 freeway and continue up to St. George Blvd. The contract is for six months, and Cindy Taylor Trucking is the contractor. Staff is working out details with regard to the rodeo and marathon, and the contractor may have to work longer hours or on weekends to finish the project. The contractor will only be allowed to pave two to three blocks at a time before they move on to another section. East and west corridors on 100 South, 300 South, 500 South, and 700 South will be kept open, and the closures will be advertised in the newspaper.

AMENDMENT TO CONTRACT:
Consider approval of an amendment to the Engineering Services Contract with Creamer and Noble for the 200 East improvement project.

City Manager Gary Esplin explained that when the project was designed, the 200 East connection was not included in the design. The additional cost is for this portion of the project.

MOTION: A motion was made by Council Member Gardner to approve the amendment.

SECOND: The motion was seconded by Council Member Bunker.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

APPROVAL OF MOU:
Consider approval of an MOU with the Federal Highway Administration, US Fish and Wildlife Service, SITLA, and UDOT for planning and mitigation of cumulative impacts identified by the EIS process for the Southern Corridor project area.

City Manager Gary Esplin explained that having an agreement will go a long way towards mitigating issues of concern. It does not bind the City, but indicates an interest in involving the US Fish and Wildlife Service in the process. The agreement is not detrimental to the City in any way.

MOTION: A motion was made by Council Member Gardner to approve the MOU.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.

APPOINTMENTS:
Appointments to boards and commissions.



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June 17, 2004
Page Twelve

Mayor McArthur asked Council Members to provide him with recommendations for appointments to boards and commission.

PUBLIC HEARING/ADOPTION OF BUDGET/RESOLUTION:
Public hearing to consider adoption of the 2004-2005 fiscal budget for the City of St. George.

This matter was continued from earlier in the meeting.

City Manager Gary Esplin explained that if the City did a 1% market adjustment for all employees, it would cost $128,000. Equating that to a 12% medical insurance increase, this would amount to a 1.75% - 2% increase. A 12% medical insurance increase would mean the employees would be in a 70/30 classification as far as the deductible. This will require employees to pay more from their own pockets. It is estimated that medical insurance costs will rise 15% annually for the foreseeable future.

Council Member Orton commented that it was obvious City employees have taken on a lot more every year and the City has not been able to keep up with the number of employees vs. growth.

MOTION: A motion was made by Council Member Orton to approve, by resolution, the 2004-05 fiscal budget, including coverage of the 12% medical insurance increase, along with other budget items recommended by the City Manager including the tamarack eradication program, one vehicle for a part-time enforcement officer, and a match for CDBG funds for administration of the program. He stated that his motion also included appreciation to all City employees.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Orton - aye
Council Member Whatcott - aye
Council Member Allen - aye
Council Member Bunker - aye
Council Member Gardner - aye

The vote was unanimous and the motion carried.

ADJOURN TO EXECUTIVE SESSION:
MOTION: A motion was made by Council Member Gardner to adjourn to an executive session to discuss litigation and personnel.

SECOND: The motion was seconded by Council Member Whatcott.

VOTE: Mayor McArthur called for a roll call vote, as follows:

Council Member Gardner - aye
Council Member Whatcott - aye
Council Member Allen - aye
Council Member Bunker - aye
Council Member Orton - aye

The vote was unanimous and the motion carried.

RECONVENE AND ADJOURN:
MOTION: A motion was made by Council Member Gardner to reconvene and adjourn.

SECOND: The motion was seconded by Council Member Allen.

VOTE: Mayor McArthur called for a vote, and all voted aye. The motion carried.




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Gay Cragun, City Recorder