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08/09/2011 - Regular - MinutesCity of Port Orchard Council Meeting Minutes Regular Meeting of August 9, 2011 1. CALL TO ORDER AND ROLL CALL Mayor Lary Coppola called the meeting to order at 7:02 p.m. Mayor Pro-Tern John Clauson and Councilmembers Fred Chang, Jerry Childs, Rob Putaansuu, Jim Colebank, Fred Olin, and Carolyn Powers were present and constituted a quorum. City Clerk Kirkpatrick, Public Works Director Dorsey, Development Director Weaver, Deputy City Clerk Rinearson, and City Attorney Jacoby were also present. A. Pledge of Allegiance Dick Davis led the audience and Council in the Pledge of Allegiance. 2. CITIZENS COMMENT Patrick Lucas requested the Council to consider bringing the streets and sidewalks up to the required ordinance level during the budget discussions of setting their priorities; and questioned as to why the Council meets outside of City Hall when conducting City business. In response to Mr. Lucas, City Clerk Kirkpatrick responded that Roberts Rules of Order states the minutes are to reflect action(s) taken by the Council, rather than discussions occurred at the meeting; and Mayor Coppola reminded Mr. Lucas that the Council meetings are recorded and are available to the public on the City's website. In response to Jerry Arnett, Mayor Coppola stated he applied for a rezone regarding his property in 2004 and was approved on September 25, 2006, by Resolution No. 018-06; and as for the current discussions relating to the Tremont Widening project, himself and Councilmember Colebank have intentionally been left out of all the discussions to not create a conflict of interest. Diane Hubert requested the Council direct staff to maintain the grass on Tremont Street that abuts the Wet Apple property, as it could be a potential fire hazard due to the tall grass and the dry weather. 3.APPROVALOFAGENDA Councilmember Olin MOVED and Councilmember Colebank seconded the motion approving the Agenda. Upon vote, the main motion as mended passed unanimously. Minutes of August 9, 2011 Page 2 of12 Councilmember Clauson MOVED and Councilmember Olin seconded the motion to amend the agenda by removing Consent Agenda Item 4A Approval of Claim Warrants, Payroll, & Treasurer's Report to Business Items. Upon vote, the motion to amend the agenda passed unanimously. 4· APPROVAL OF CONSENT AGENDA A. Approval of Claim Vlarrants, Payroll & Treasurer's cheek book B. Approval of the July 19, 2011, Work Study Session Minutes C. Approval of the July 26, 2011, Council Meeting Minutes D. Setting Meeting for Work Study Session to August 16, 2011, at 7:00p.m. at City Hall E. Adoption of Ordinance No. 011-11, Amending the 2011 Budget F. Adoption of Resolution No. 021-11, Relating to Grant Funding Requests for the Bay Street Pedestrian Path/MF Trail-Phase I Construction G. Adoption of Resolution No. 022-11, Relating to Grant Funding Requests for the McCormick Village Park Phase I Construction Councilmember Childs MOVED and Councilmember Olin seconded the motion to approve the Consent Agenda. Upon vote, the motion passed unanimously. 5· PRESENTATION State Senator Kilmer for the 26th District provided a Legislative update, stating the following: • Explained that the State Budget revenue side of the ledger is made up of nearly half from sales tax, which is not coming in as projected; and 20% from business and occupation tax; • As expenditures take a downturn during this economic time, there is an increased demand for State services; such as the three "eights" educate, medicate, and incarcerate; • The state has seen an increase in crime, unemployment, and record enrollment at the community college level, as well as an increase in the K -12 systems as parents can no longer afford private schooling; • The state is facing a budget deficit for the biennium of five billion dollars; • The current biennium budget is unique as it was done through bipartisanship and was reformed oriented with both sides determining what the state would look like in the next 20 years, rather than a budget cutting exercise; • The current biennium budget is responsive and responsible and it is the first time in 14 years that it is slated to spend less than what is being slated to take in by focusing on the core essentials and living within the state's means; • The budget process was very difficult and nearly every functional area saw cuts; Minutes of August 9, 2011 Page 3·of12 Senator Kilmer noted that there was room for optimism at the end of the session, noting that: • As he arrived in Port Orchard this evening and saw the vista it reminded him of the initial territorial seal of the State, which points to the word "Alld" meaning hope for the future and he is hopeful that the state will succeed in getting the economy moving again; • The State's budget increased funds for the work force training program, which has a success rate of an astounding So% for re-training people in a new skill, which puts them back into the work force; • Olympic College's new 4-year engineering degree program was able to maintain its funding; as this is a well needed program as this helps the shipyard hire qualified, local residents, in addition to building the local economy; • He worked with Representative Christine Rolfes to develop a conversion system for Veterans leaving the military and entering into the civilian work force, by passing legislation that would help subsidize their education based on what they have already learned in the military and not forcing them to relearn what they already have experience in; and • That despite a smaller Capitol budget, he was still able to be a partner in obtaining $700,000 for the City to help with updating the DeKalb pier due to the mandate from the Department of Natural Resources. In response to Councilmember Clauson, Senator Kilmer stated that Governor Gregoire has told state agencies to prepare their budget on two levels; one with a s% reduction and another with a 10% reduction. Mayor Coppola announced that the City had received the last of the petitions to move forward with the Bethel Corridor Annexation and clarified this would in no way affect the impact of the water rates, as they are on West Sound Utility District's system. 6. PUBLIC HEARING A. Proposed 2011 Water Rate Increase Public Works Director Dorsey presented the staff report, noting that based upon the data provided within the Study and the discussions held at the May and June 2011, City Council Work Study Meetings, the Utility Committee is proposing a monthly rate increase of $12.00 with implementation options as follows: • Option A Increase $12/Month in 2011 • Option B Increase $6/Month in 2011 and an additional $6/Month in 2012 • Option C Increase $6/Month in 2011 and an additional $6/Month in 2014 • Option D Increase $4/Month in 2011, and additional $4/Month in 2013 and a additional $4/Month in 2015 Minutes of August 9, 2011 Page 4 of12 In addition, he clarified that the water quality issue has always been a priority for the City and Staff has been working with the residents to determine the root cause of the water quality and hoped to be able to identify the cause, with funding placed in the 2012 budget. Mayor Coppola opened the Public Hearing at 7:41 p.m. Patrick Lucas voiced his opposition to raising the water rates and asked that the City direct Staff to do water quality testing throughout the entire City, not just one area. Michelle Marshall explained her water bill has increased consistently since 2002 and for that reason, voiced her opposition of another water rate increase. Jerry Arnett voiced his opposition to the water rate increase and asked if the installation of the McCormick Woods Water Reservoir was included in the water rate increase and if so, what changed in the operation of the utility to go from operating in the red for the past three years. Gerry Harmon asked the Council to consider changing the rates to a per gallon usage charge, and was disappointed that the Council had not tasked Staff to research the comparison of the rates. Dick Davis spoke in support of the rate increase, stating the need for the increase was to invest in protecting the City's infrastructure by being proactive rather than reactive to a crisis situation; and asked that the City control spending on the proposed projects by establishing priorities, and incentives to the contractors in order to complete projects on time and under budget. Art Michelson spoke in favor of the rate increase stating he is willing to support the increase so as long as it was with the understanding that it would improve the water system. Jeff Braden spoke in opposition of the water rate increase and asked the Council to look at other options, including the priority of the projects that impact the water rate increase. Tadina Crouch spoke in opposition of the water rate increase and asked that residents are kept in the loop as to when any improvements to the infrastructure are implemented and how it may impact water quality during the project construction phase. Marty McMurray asked the City to look into other options such as to possibly bill at a base rate. Cliff Macintosh spoke in opposition of the water rate increase, noting that should the rate increase pass, he favored the rate being spread out over the next two years. Minutes of August 9, 2011 Page 5 of12 Michael Carrington spoke in opposition of the water rate increase stating water quality is a health risk that the City should focus on first. Gil Michael spoke in opposition of the water rate increase stating the City should forgo the addition to add to its reserve fund and take what is in the current reserve fund and spread it out amongst the residents, which would produce a rate reduction to the rate payers. Michael Carrington spoke in opposition of the City switching to a per gallon water charge. There being no further testimony, Mayor Coppola closed the Public Hearing at 8:29 p.m. B. Consideration of the Renewal of Moratorium on Medical Marijuana Dispensaries Adopted under Ordinance No. 002-11 City Attorney Jacoby presented the staff report, noting on February 22, 2011, the City Council adopted Ordinance No. 002-11, imposing a six month moratorium on accepting or processing applications, permits, or licenses for any building or land use activity relating to medical marijuana dispensaries. RCW 35.63.200 allows the City Council to renew the moratorium for an additional six months if a second public hearing is held and findings of fact are made prior to the renewal. Mayor Coppola opened the Public Hearing at 8:32 p.m. Chris Stansberry spoke in opposition of the Council extending the moratorium, noting this would be a unique opportunity to help those citizens of Port Orchard who are dire need of their medication, and the regulations will create a safe place for them to obtain this medication. Troy Barber spoke in opposition of the Council extending the moratorium, stating the community needs a safe place to access their medication and a moratorium would force residents to obtain the medication via the "black market," which would encourage an increase in drug activity. Christopher Renquist spoke in opposition of the extension of the moratorium, noting he had applied for a dispensary permit, which was rejected due to the moratorium; that he had to move his business to another area; and the City was forcing hundreds of citizens to receive their medication outside of the City. Lee Rosenburg clarified that collective gardens are not part of the moratorium. . Mary Phelps spoke in favor of extending the moratorium. Minutes of August 9, 2011 Page 6 of12 There being no further testimony, Mayor Coppola closed the Public Hearing at 8:39 p.m. C. Pre-Annexation Development Agreement with Home Depot, Inc. Development Director Weaver presented the staff report, noting this Public Hearing is for a Pre-annexation Development Agreement between Home Depot and the City, related to the construction located at 3747 Bethel Road SE. The City and Home Depot desire to enter into a Development Agreement, as authorized by RCW 36.70B.170, which would establish procedures and standards for the review and approval of a vested development approved within Kitsap County. The Agreement would set forth the process for transfer of administration of the approved development standards that apply, the period of time within which the development standards would apply, and the method and manner in which the approved development would be inspected and/ or amendments may be processed. Mayor Coppola opened the Public Hearing, and there being no testimony, closed the Public Hearing at 8:40 p.m. 7. BUSINESS ITEMS Mayor Coppola and Councilmember Colebank recused themselves from the meeting for this item, each declaring a conflict of interest. A. Approval of Claim Warrants, Payroll & Treasurer's Checkbook Councilmember Clauson stated the removal of this item was due to a conflict of interest regarding the Mayor and Councilmember Colebank; as there are checks being issued related to the Tremont Street Widening Project. Councilmember Olin MOVED and Councilmember Putaansuu seconded the motion to approve the claim warrants, payroll and treasurer's checkbook. Upon vote, the motion passed unanimously. Councilmember Colebank was recused. B. Adoption of Ordinance No. 014-11, Dedicating Certain Real Property for Right-of-Way Purposes as Part of the Tremont Street Widening Project Public Works Director Dorsey presented the staff report, noting in order to construct the Tremont Street Widening Project, the City must acquire right-of-way and/ or slope easements along Tremont Street from certain property owners for right-of-way purposes, including property owned by the City of Port Orchard. Minutes of August 9, 2011 Page 7 of12 Councilmember Putaansuu MOVED and Councilmember Olin seconded the motion to adopt Ordinance No. 014-11, thereby dedicating certain real property currently owned by the City of Port Orchard for right-of-way purposes. Upon vote, the motion passed unanimously. Councilmember Colebank was recused. At 8:45 p.m. Mayor Coppola assumed the gavel and Councilmember Colebank was invited rejoin the meeting. C. Adoption of Ordinance No. 012-11, Renewing a Moratorium on Accepting or Processing Applications, Permits, or Licenses for any Building or Land Use Activity Involving Medical Marijuana City Attorney Jacoby presented the staff report, noting on February 22, 2011, the Council adopted Ordinance No. 002-11, imposing a moratorium on the acceptance or processing of any applications for building or land use activities relating to a medical marijuana business or dispensary, or facilities within which a medical marijuana business or dispensary will be operated. The Ordinance was set to expire on August 19, 2011. Staff and the Planning Commission required additional time to consider appropriate zoning and land use recommendations because of the uncertainty arising from the Washington State Legislature's late adoption of significant revisions to the applicable State law and the Governor's subsequent veto of many of those provisions. Councilmember Colebank MOVED and Councilmember Olin seconded the motion to adopt Ordinance No. 012-11, to renew the moratorium on accepting or processing applications, permits, or licenses for any building or land use activity involving medical marijuana for an additional six months. Upon vote, the motion passed with six affirmative votes and one dissenting vote. Councilmember Chang cast the dissenting vote. The Council directed the City Attorney to provide information relating to Collective Gardening at the August Work Study Session. D. Adoption of Resolution No. 023-11, Approving Contract No. 057-11, Authorizing the Mayor to Execute Pre-Annexation Development Agreement with Home Depot, Inc. City Attorney Jacoby presented the staff report, noting this item was for approval of a Pre- annexation Development Agreement between Home Depot, Inc. and the City, related to the construction located at 3747 Bethel Road SE. A Public Hearing was heard earlier this evening on this matter. The City and Home Depot desired to enter into a Development Agreement, as authorized by RCW 36.708.170, to establish procedures and standards for the review and approval of a vested development approved within Kitsap County. The Minutes of August 9, 2011 Page 8 of12 Agreement was intended to set forth the process for transfer of administration of the approved development standards that apply, the period of time within which the development standards would apply, and the method and manner in which the approved development would be inspected and/ or amendments may be processed. The City attorney drafted and reviewed the developer's agreement and the combined documents are in compliance the city Comprehensive Plan and applicable Port Orchard Municipal Code and all other state and local regulations. Councilmember Childs MOVED and Councilmember Colebank seconded the motion to adopt Resolution No. 023-11, authorizing the Mayor to execute Pre- Annexation Development Agreement No. 057-11, with Home Depot, Inc. in a form approved by the City Attorney. Upon vote, the motion passed unanimously. E. Adoption of Resolution No. 024-11, Ratifying the Council's Approval of Contract No. 058-11, Pre-Annexation Development Agreement with Wal-Mart, Inc. City Attorney Jacoby presented the staff report, noting RCW 36.70B.200 required the Council approve development agreements by resolution or ordinance. In the course of preparing the materials for the Pre-Annexation Development Agreement with Home Depot, the City Attorney realized that he had not provided Council with a resolution approving the Wal-Mart Development Agreement. A resolution was prepared to ratify the Council's approval of July 12, 2011. Councilmember Colebank MOVED and Councilmember Clauson seconded the motion to adopt Resolution No. 024-11, ratifying the City Council's unanimous approval of the Pre-Annexation Development Agreement with Wal-Mart, Inc. Upon vote, the motion passed unanimously. F. Adoption of Ordinance No. 013-11, Establishing a New Port Orchard Municipal Code Chapter 2.38 Legal Defense of Officials and Employees City Attorney Jacoby presented the staff report, noting RCW 4.96.041 authorizes local governments to establish a procedure for providing indemnification and defense of officials and employees for lawsuits filed against them seeking damages for acts or omissions which arise from the good faith performance of their duties. Councilmember Putaansuu MOVED and Councilmember Olin seconded the motion to adopt Ordinance No. 013-11 establishing a new Port Orchard Municipal Code Chapter 2.38 "Legal defense of City officials and employees." Upon vote, the motion passed unanimously. Minutes of August 9, 2011 Page 9 of12 G. Adoption of Resolution No. 025-11, Accepting the Storm Water Pond and Storm Water Appurtenances for Flower Meadows Division 1 Public Works Director Dorsey presented the staff report, noting in 2002, the Council approved the Final Plat of Flower Meadows -Division I. In that approval, a plat condition stated that "the stormwater pond located on Tract A will be accepted by the City of Port Orchard upon final plat acceptance of the last division within the Flower Meadows subdivision." To date, the City has not accepted the stormwater pond and/or the associated maintenance of Tract A, which was still under the Flower Meadows Division I Home Owner's Association (HOA) ownership. Current representatives of the HOA (who have legal authority) were willing to sign a Bill of Sale and Quit Claim Deed conveying Tract A over to the City. In the best interest of the residents of the Flower Meadows Division I plat, as well as the health and safety of its citizens, City Staff would like to accept the stormwater system as described. Councilmember Colebank MOVED and Councilmember Childs seconded the motion to adopt Resolution No. 025-11, thereby accepting the stormwater pond and stormwater appurtenances associated with Flower Meadows Division I. Upon vote, the motion passed with four affirmative votes and three dissenting votes. Councilmember Chang, Colebank, and Olin cast the dissenting votes. H. Approval of Contract No. 068-11, Authorizing the Mayor to Execute Agreement with Caseco Associates, Inc. for the Prospect Street Alley/Seattle Street Slide Repair Development Director Weaver presented the staff report, noting on June 6, 2011, the Port Orchard Public Works Department mailed out a Request for Proposal (RFP) to six (6) local contractors registered on the City's 2011 Small Works Roster for the Prospect Alley/Seattle Slide Repair Project. On June 24, 2011, City staff received two (2) responsive bids as follows: RV Associates, Inc. Caseco Associates, Inc. $112,590.00 (including use tax) $ 71,840.00 (including use tax) A review was performed by the Public Works Director to ensure that all required "Work" as specified within the March 16, 2011 N.L. Olson & Associates, Inc. Plans was provided for by both contractor bids. Based upon the proposal(s) received and the Scope of Work comparison performed, it has been determined that Caseco Associates, Inc. was the lowest qualified bidder. Councilmember Chang MOVED and Councilmember Colebank seconded the motion to authorize the Mayor to execute the Small Works Construction Contract No. 068-11, with Caseco Associates, Inc. in an amount not to exceed Minutes of August 9, 2011 Page 10 of12 $71, 840, for the Prospect Alley/Seattle Street Slide Repair Project. Upon vote, the motion passed unanimously. I. Approval of Contract No. 069-11, Authorizing the Mayor to Execute Settlement, Release, and Full Exoneration Form for Point West, Inc. Canyon Creek Subdivision Bond No. 578362S Public Works Director Dorsey presented the staff report, noting on March 10, 2010, the Assistant City Engineer sent a letter to Mr. Chad Brown advising him that the City could not release his performance bond, since all improvements that were bonded had not yet been installed. Per the performance bond; a street light, asphalt curbing, and a retention pond/ control facility were required. To date, the street light and the asphalt curbing have not been installed. On April13, 2011, Public Works Director sent Mr. Chad Brown a letter stating that the City had sent a request to the bonding company the previous day making a "demand on the bond" for the Points West, Inc. Canyon Creek Subdivision to complete the bonded work that has yet not been completed. On April 18, 2011, the City received a letter from the Insco Dico Group (bonding company) dated April13, 2011, stating they would start the investigation to release the bond to the City and to notify Mr. Brown of their intentions. On June 24,2011, the bonding company sent a letter concluding the investigation of the City's claim against the bond of Points West Inc. and determined that liability had been triggered. The bonding company requested that the appropriate person execute their agreement and upon receipt of the executed agreement they would arrange for a check to be issued to the City in the amount of $11,445, which was the full bond amount. Councilmember Olin MOVED and Councilmember Powers seconded the motion to authorize the Mayor to execute the Settlement, Release, and Full Exoneration Form No. 069-11, for Point West, Inc. Canyon Creek Subdivision (Bond No. 578362S). Upon vote, the motion passed unanimously. J. Approval of Change Order No. 1 to Contract No. 050-11, with Pacific Coast General, LCC for Pottery Force Main Public Works Director Dorsey presented the staff report, noting on June 14, 2011 the City of Port Orchard approved the construction contract for the Pottery Force Main and Tremont Detour Project with Pacific Coast General, LLC in the bid amount of $823,232.20. Pursuant to the project specifications cited, being WSDOT Standard Specification 1-07.2(1), the total bid amount included State Sales Tax within the various unit bid prices for materials and equipment only. What should have been cited in the project specifications was WSDOT Standard Plan 1-07.2(1) and 1-07.2(2), so that the various unit bid prices also included State Sales Tax on labor and services, which are only exempt for public road construction projects or portions thereof. Change Order No. 1 provides a credit back to the City for ALL taxes previously included on materials and equipment within the original unit bid prices. Given the proper specification citation noted above (pursuant to DOR Rule 170 Minutes of August 9, 2011 Page 11 of12 & 171 and WAC 458-20-170 & 171), the correct tax consequence for the project is now correctly determined to be $40,436.04, which would be provided to the contractor for payment to the State. The revised total contract amount was $863,668.24. Councilmember Powers MOVED and Councilmember Clauson seconded the motion to authorize the Mayor to execute Change Order No.1 to Contract No. 050-11, with Pacific Coast General, LLC, in an amount of $40,436.04, thereby providing the correct tax consequence for the Pottery Force Main and Tremont Detour Project. Upon vote, the motion passed unanimously. K. Approval of Mayoral Appointments to the Lodging Tax Advisory Committee City Clerk Kirkpatrick presented the staff report, noting annually, the City Council was asked to approve the Mayor's recommendation for appointment to the Lodging Tax Advisory Committee pursuant to Port Orchard Municipal Code 2.22. In addition, RCW 67.28.1817 requires that at least two members of the advisory committee be from establishments that collect the tax (hotels, motels and Bed and Breakfasts) and two members be from organizations that are "involved in activities authorized to be funded" by the hotel/motel tax fund. Councilmember Chang is the current Committee Chair and each of the proposed members has agreed to serve on the Lodging Tax Advisory Committee. Councilmember Childs MOVED and Councilmember Clauson seconded the motion to approve the Mayor's appointment of representatives from Comfort Inn and Hidden Treasure's Bed and Breakfast as well as members from the following organizations: Port Orchard Bay Street Association and Kitsap Peninsula Visitor and Convention Bureau. Councilmember Olin MOVED and Councilmember Chang seconded the motion to authorize the Mayor to appoint two more members to serve on the Lodging Tax Committee with one member representing the collection of tax and one member who is involved in activities authorized to be funded. Councilmember Olin Called for the Question and upon vote, the motion passed with four affirmative votes and three dissenting votes. Councilmember Childs, Colebank, and Olin cast the dissenting votes. Upon vote, the motion to amend passed with six affirmative votes and one dissenting vote. Councilmember Childs cast the dissenting vote. Upon vote, the main motion, as amended, passed with six affirmative votes and one dissenting vote. Councilmember Colebank cast the dissenting vote. Minutes of August 9 , 2011 Page 12 of12 Councilmember Olin MOVED and Councilmember Powers seconded the motion to authorize the Mayor to extend the City Council meeting for an additional 15 minutes. Upon vote, the motion passed with six affirmative votes and one dissenting vote. Councilmember Putaansuu cast the dissenting vote. L. Approval of Public Event Application: Taste of Port Orchard City Clerk Kirkpatrick presented the staff report, noting John Ready, President of the Port Orchard Bay Street Association had submitted an application for a new public event: The Taste of Port Orchard, which would be held on Sunday, September 4, 2011. The event would be located at the Waterfront Gazebo Park off of Bay Street and extend approximately halfway into the City's parking lot, with the understanding the event organizers had secured permission from the Port of Bremerton to use the Waterfront Gazebo. City Departments, as well as the Fire Department and Kitsap Transit have reviewed the application and have submitted their recommendations and/ or comments. Councilmember Clauson MOVED and Councilmember Colebank seconded the motion to approve the public event application for the Taste of Port Orchard to be held on Sunday, September 4, 2011, which will include the use of the Waterfront Gazebo and a portion of the City's parking lot. Upon vote, the motion passed unanimously. Councilmember Putaansuu MOVED and Councilmember Childs seconded the motion to adjourn the Council meeting. Upon vote, the motion passed with four affirmative votes and three dissenting votes. Councilmember Chang, Olin, and Powers cast the dissenting votes. 13. ADJOURNMENT 0 :02 p.m. Mayp r Coppola adjourned the meeting.