A regular meeting of the Menominee City Council, City of Menominee, County of Menominee, State of Michigan, was held Monday, December 20, 2004 at 5 p.m. in the Municipal Complex Council Chambers.

The Honorable George W. Krah called the meeting to order and led the pledge of allegiance to the flag.

PRESENT: 9 ABSENT: 0

A motion was made by Council Member Hudon and seconded by Council Member Jasper to approve the agenda for the meeting dated December 13, 2004 with the deletion of #6 under Reports of Standing Committees, The Judicial and Legislative Committee on the proposed Tree Ordinance, and amending #7 under Reports of Standing Committees, The Parks and Recreation Committee on amending Policy P-91-3 – River Park Rates to include weekly rates. This motion was carried unanimously.

The minutes of the regular meeting of November 15, 2004 were corrected as follows: A motion was made by Council Member Plemel and seconded by Council Member Fernstrum to authorize the City Manager and staff to meet with Mr. Dulak to form discuss the possible creation of a TIF district to assist with infrastructure costs. This motion was carried unanimously.

There being no additions or corrections to the minutes of the special meeting of November 22, 2004, the minutes stood approved as presented.

Mayor Krah opened the public comment session that was called for the purpose of hearing citizen comments on agenda items only.

No one was heard.

A motion was made by Council Member Sorensen and seconded by Council Member Organ to close the public comment session. This motion was carried unanimously.

Regular Council Proceedings

December 20, 2004

Page Two

Under reports of officers, City Manager Anthony Furton presented the following report:

Under reports of officers, City Manager Anthony D. Furton submitted the following report on the City's main operating funds for the fiscal year ending June 30, 2004. Also included is a management letter, which provides an overview of the City's financial activities for the same period.

The General Fund undesignated fund balance at the completion of the fiscal was $846,375. This figure represents a decrease of $127,678 from the previous year. The reduction is a result of the budgeted use of the fund balance to balance the budget during the budget process for the fiscal year. Although I don't like to see a reduction in the fund balance, the present balance is more favorable than the estimate that I reported previously.

The financial condition of the General Fund remains in a sound state at this time. It is presently at 18% of our operating budget, which is down from 21%. The benchmark for this fund is 15% as a guideline.

The Water and Wastewater Treatment Utility Funds had a combined net income of $125,232. The Water Fund had a net loss of $14,377, and the Wastewater Fund had net income of $139,609. Both funds had small decreases in their cash flow positions at year end mainly as a result of debt reduction and construction projects. I anticipate a rate increase in the three percent range for the upcoming fiscal year will be necessary to maintain a positive cash flow.

The Major Street Fund, the fund that supports the City's main roads, had a fund balance decrease of $294,392. This decrease was anticipated and planned to fund the Menekaunee Bridge rehabilitation project. The fund balance was increased during the past two years to cover the project expenses without having to borrow the funds. The balance of this fund is now $52,345.

The fund balance of the Local Street Fund decreased by $19,784 and now has a balance of $30,525. This is mainly a result of only making a 15 percent transfer from the Major Street Fund instead of the normal 25 percent. I anticipate that the finances of these two funds will stabilize as the remainder of construction projects are funded from the Street Construction Fund.

The Cemetery Fund has a fund balance of $65,747. This is a decrease of $29,952. The Cemetery Board has increased the rates and also changed the allocation of funds to the Perpetual Care Fund. These changes should make the Cemetery Fund more self sustaining and less dependant on the General Fund.

In summary, the City’s financial position remained sound and positive at fiscal year end 2004. All City funds once again completed the year with positive fund balances. Several funds, including the General Fund, had fund balance decreases in the past year. Fortunately, they were in position to handle the reductions. The City's financial position is going to continue to be challenged in the future, so it will be imperative to be prudent with expending our resources.

Regular Council Proceedings

December 20, 2004

Page Three

At a December 8, 2004 meeting the Buildings and Grounds Committee reviewed Application for Payment #5 in the amount of $12,749.76 to The Markell Company for Reroofing of the Municipal Complex and they recommended that it be approved.

S/BUILDINGS AND GROUNDS COMMITTEE

A motion was made by Council Member Sorensen and seconded by Council Member Hudon to adopt the foregoing report. This motion was carried unanimously.

At a December 8, 2004 meeting the Buildings and Grounds Committee reviewed Application for Payment #1 in the amount of $7,295.00 to M&M Trucking for Contract 04-BD-02 - Building Demolition - 2104-14^th Avenue and they recommended that it be approved.

A motion was made by Council Member Plemel and seconded by Council Member Fernstrum to adopt the foregoing report. This motion was carried unanimously.

A motion was made by Council Member Plemel and seconded by Council Member Sorensen to adopt the foregoing report. This motion was carried unanimously.

At a meeting held December 13, 2004 the Finance Committee reviewed the audit for the fiscal year that ended June 30, 2004 as prepared by Henquinet, Unger and Walters and they recommended that the audit for the fiscal year ended June 30, 2004 be accepted and the financial statements be published as required.

A motion was made by Council Member Plemel and seconded by Council Member Sorensen to adopt the foregoing report.

AYES: Hudon, Jasper, Krah, Mick, Organ, Plemel, Schloegel, Sorensen, and Fernstrum

NAYS: None

This motion was carried unanimously.

Regular Council Proceedings

December 20, 2004

Page Four

A motion was made by Council Member Fernstrum and seconded by Council Member Hudon to adopt the foregoing report. This motion was carried unanimously.

At a December 8, 2004 meeting the Parks and Recreation Committee reviewed Policy P-91-3, River Park Rates, and they recommended that the policy be amended to include the following:

A motion was made by Council Member Fernstrum and seconded by Council Member Organ to amend the report to approve the daily and monthly rate and refer the weekly back to the committee. This motion was carried unanimously.

A motion was made by Council Member Plemel and seconded by Council Member Sorensen to adopt the report as amended. This motion was carried unanimously.

At a December 8, 2004 meeting the Parks and Recreation Committee reviewed the Menominee County Family Court's "Adopt-A-Spot" community beautification project at Duby Park and they recommended that their request to adopt the park be granted.

A motion was made by Council Member Jasper and seconded by Council Member Plemel to adopt the foregoing report. This motion was carried unanimously.

Regular Council Proceedings

December 20, 2004

Page Five

At a meeting held December 8, 2004 the Parks and Recreation Committee reviewed the proposed Land and Water Conservation Fund Development Project Agreement between the Michigan Department of Natural Resources and the City of Menominee to provide funding for the Spies Field project in the amount of $460,425.00 and they recommended that city officials be authorized to execute the agreement and that the following resolution be adopted:

RESOLUTION

RESOLVED, that the City of Menominee, Michigan, does hereby accept the terms of the Agreement as received from the Michigan Department of Natural Resources, and that the City of Menominee does hereby specifically agree, but not by way of limitation, as follows:

1. To appropriate all funds necessary to complete the project during the project period and to provide Four Hundred Sixty Thousand Four Hundred Twenty Five and Zero/Hundredths Dollars ($460,425.00) to match the grant authorized by the DEPARTMENT.
2. To maintain satisfactory financial accounts, documents, and records to make them available to the DEPARTMENT for auditing at reasonable times.
3. To construct the project and provide such funds, services, and materials as may be necessary to satisfy the terms of said Agreement.
4. To regulate the use of the facility constructed and reserved under this Agreement to assure the use therefore by the public on equal and reasonable terms.
5. To comply with any and all terms of said Agreement including all terms not specifically set forth in the foregoing portions of this Resolution.

S/PARKS & RECREATION COMMITTEE

A motion was made by Council Member Fernstrum and seconded by Council Member Hudon to adopt the foregoing report. This motion was carried unanimously.

COMMITTEE REPORT:

The Public Safety Committee reported that they had held interviews for the position of Sergeant in the Police Department and recommended the appointment of Andrew Laurin to this position under the customary probationary period.

S/PUBLIC SAFETY COMMITTEE

A motion was made by Council Member Fernstrum and seconded by Council Member Plemel to adopt the foregoing report. This motion was carried unanimously.

COMMITTEE REPORT:

At a December 8, 2004 meeting the Public Safety Committee reviewed the following Traffic Control Orders and recommended that they be adopted:

Regular Council Proceedings

December 20, 2004

Page Six

TRAFFIC CONTROL ORDER

SUBJECT: STOP SIGNS

EFFECTIVE DATE: NOVEMBER 16, 2004 at 12:01 a.m.

It is ordered pursuant to Section 9:1.1 of the MOC that stop signs shall be erected at the following locations and all vehicles shall be required to stop and yield right of way as required by the Michigan Vehicle Code, Section 257.649, as adopted by the City of Menominee.

On 8^th Avenue (For Westbound Travel) at the intersection of 4^th Street

On 8^th Avenue (For Eastbound Travel) at the intersection of 2^nd Street

On 21^st Street (For Both North and Southbound Travel) at the intersection of 16^th Avenue

On 32^nd Avenue (For Both East and Westbound Travel) at the intersection of 17^th Street

On 34^th Avenue (For Both East and Westbound Travel) at the intersection of 17^th Street

On 32^nd Avenue (For Both East and Westbound Travel) at the intersection of 18^th Street

On 18^th Street (For Both Northbound Travel) at the intersection of 13^th Avenue

On 11^th Street (For Both North and Southbound Travel) at the intersection of 34^th Avenue

On 12^th Street (For Both North and Southbound Travel) at the intersection of 35^th Avenue

On 39th Avenue (For Westbound Travel) at the intersection of 18^th Street

On 41^st Avenue (For Westbound Travel) at the intersection of 18^th Street

On 14^th Street (For Southbound Travel) at the intersection of 46^th Avenue

This Traffic Control Order shall become effective at 12:01 a.m. on November 16, 2004 and upon approval by the Menominee City Council, it shall not expire.

I hereby certify that on November 15, 2004 proper signs were installed at the intersections designated in the above order.

S/Jeffrey Jones, Traffic Engineer, Director of Police/Fire Services

TRAFFIC CONTROL ORDER

SUBJECT: YIELD SIGNS

EFFECTIVE DATE: NOVEMBER 16, 2004 at 12:01 a.m.

It is ordered pursuant to Section 9:1.1 of the MOC that yield signs shall be erected at the following locations and all vehicles shall be required to stop and yield right of way as required by the Michigan Vehicle Code, Section 257.649, as adopted by the City of Menominee.

On 17^th Avenue (For Westbound Travel) at the intersection of 20^th Street

On 19^th Street (For Both North and Southbound Travel) at the intersection of 28^th Avenue

On 11^th Street (For Both North and Southbound Travel) at the intersection of 36^th Avenue

On 11^th Street (For Both North and Southbound Travel) at the intersection of 37^th Avenue

On 36^th Avenue (For Both East and Westbound Travel) at the intersection of 12^th Street

On 37^th Avenue (For Both East and Westbound Travel) at the intersection of 12^th Street

On 14^th Street (For Both North and Southbound Travel) at the intersection of 40^th Avenue

On 14^th Street (For Both North and Southbound Travel) at the intersection of 42^nd Avenue

On 15^th Street (For Both Northbound Travel) at the intersection of 42^nd Avenue

Regular Council Proceedings

December 20, 2004

Page Seven

This Traffic Control Order shall become effective at 12:01 a.m. on November 16, 2004 and upon approval by the Menominee City Council, it shall not expire.

I hereby certify that on November 15, 2004 proper signs were installed at the intersections designated in the above order.

S/Jeffrey Jones, Traffic Engineer, Director of Police/Fire Services

S/PUBLIC SAFETY COMMITTEE

A motion was made by Council Member Plemel and seconded by Council Member Jasper to adopt the foregoing report. This motion was carried unanimously.

At a December 13, 2004 meeting the Public Works Committee reviewed the communication from the American Transmission Company regarding the West Marinette-Amberg electric transmission line rebuild project and they recommended that the City grant permits as required.

S/PUBLIC WORKS COMMITTEE

A motion was made by Council Member Hudon and seconded by Council Member Mick to adopt the foregoing report. This motion was carried unanimously.

At a December 13, 2004 meeting the Public Works Committee reviewed the design and construction engineering proposals from consultant engineers for the 10^th Avenue reconstruction project and they recommended acceptance of the proposal submitted by Ayres and Associates in the amount of $75,297.00.

S/PUBLIC WORKS COMMITTEE

A motion was made by Council Member Plemel and seconded by Council Member Mick to adopt the foregoing report. This motion was carried unanimously.

At a December 13, 2004 meeting the Public Works Committee reviewed Application for Payment #2 in the amount of $44,125.82 and Contract Modification #2 increasing the contract amount by $6,737.24 to Barley Trucking and Excavating, Inc. for Contract 04-RD-04, 34^th Avenue Road Reconstruction and they recommended that they be approved.

S/PUBLIC WORKS COMMITTEE

Regular Council Proceedings

December 20, 2004

Page Eight

A motion was made by Council Member Mick and seconded by Council Member Plemel to adopt the foregoing report. This motion was carried unanimously.

The only item under motions and resolutions was the following meeting schedule:

January 17^th 13^th 11^th 11^th

February 21^st 10^th 8^th 8^th

March 21^st 10^th 8^th 8^th

April 18^th 14^th 12^th 12^th

May 16^th 12^th 10^th 10^th

June 20^th 9^th 14^th 14^th

July 18^th 14^th 12^th 12^th

August 15^th 11^th 9^th 9^th

September 19^th 8^th 13^th 13^th

October 17^th 13^th 11^th 11^th

November 21^st 6:30 p.m. 10^th 8^th 8^th

December 19^th 8^th 13^th 13^th

• City Council meeting schedule is tentative and may be changed to meet the needs and schedules of council members. Requires proper public notification.
• Cemetery Board meets in the Committee Room of the Municipal Complex, 2511-10^th Street, Menominee, MI 49858.
• City Council, Water and Wastewater Utility Board (WWUB), and Planning Commission meet in the Council Chambers of the Municipal Complex, 2511-10^th Street.

A motion was made by Council Member Jasper and seconded by Council Member Organ to amend the time of the November 21^st City Council meeting to 6:30 p.m. This motion was carried unanimously.

A motion was made by Council Member Plemel and seconded by Council Member Sorensen to approve the meeting schedule as amended. This motion was carried unanimously.

Regular Council Proceedings

December 20, 2004

Page Nine

Mayor Krah opened the public comment session.

The American Transmission Company's route for upgraded electric service will follow the current right-of-way with poles in approximately the same locations as current poles.

A motion was made by Council Member Plemel and seconded by Council Member Jasper to close the public comment session. This motion was carried unanimously.

A motion was made by Council Member Plemel and seconded by Council Member Jasper to adjourn to closed session to discuss negotiations.

AYES: Jasper, Krah, Mick, Organ, Plemel, Schloegel, Sorensen, Fernstrum, and Hudon

NAYS: None

This motion was carried unanimously.

A motion was made by Council Member Organ and seconded by Council Member Sorensen to return to open session. This motion was carried unanimously.

The Personnel and Labor Committee reported that they had reached a tentative contract agreement with the Teamsters Local No. 328 representing the union employees in the Public Works Department. The tentative agreement provided for the following changes in the existing contract:

S/PERSONNEL & LABOR COMMITTEE

A motion was made by Council Member Organ and seconded by Council Member Plemel to adopt the foregoing report. This motion was carried unanimously.

The Personnel and Labor Committee reported that they had reviewed the department head and non union wage and benefit adjustments and recommended that the following be adopted:

1. Sick leave language amendment for call in after two days.
2. Paid holidays at Christmas and New Years will be exchanged for floating holidays when days fall on weekends.
3. Insurance plan can be switched at no cost to the City.

1) Wage increases as follows:

a) 2.6% first year retroactive to July 1, 2004

b) 2.5% second year

2. Switch from BC/BS PPO 1 to BC/BS PPO 2/PPO 3 out of network (January 18, 2005) with $10/$40 drug card co-pay; Year 2 employees contribute to premium weekly, $5.00 family, $4.00 couple, and $3.00 single.
3. $1 per year increase in longevity each year.
4. $5 increase for safety shoes and safety glasses allowance.
5. Option of retirement benefit or pay increase at no cost to the City.

S/PERSONNEL & LABOR COMMITTEE

A motion was made by Council Member Plemel and seconded by Council Member Organ to adjourn to closed session to discuss pending litigation (Krygoski Construction Company, Inc. v City of Menominee, United States District Court, Western District of Michigan, Case No.: 04-CV-076).