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HomeMy WebLinkAbout2026.03.09 CCM STUDY03/09/26 -1- MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA STUDY SESSION MARCH 9, 2026 CITY HALL – COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Study Session called to order by Mayor April Graves at 6:02 p.m. ROLL CALL Mayor April Graves, Councilmembers Dan Jerzak, Teneshia Kragness, Kris Lawrence-Anderson, and Laurie Ann Moore. Also present were Interim City Manager Daren Nyquist, Interim Deputy City Manager and Public Works Director Liz Heyman, City Clerk Shannon Pettit, and City Attorney Siobhan Tolar. CITY COUNCIL MISCELLANEOUS DISCUSSION ITEMS Mayor Graves asked if there were any questions on agenda items. Councilmember Moore said she would like to pull Consent Agenda item 6h. Resolution Approving Interim City Manager Daren Nyquist for the City of Brooklyn Center for calendar year 2026. Mayor Graves asked why Councilmember Moore would like to pull that agenda item. Councilmember Moore said she would like to discuss that agenda item. Mayor Graves asked if the Council would entertain discussing it right now. Councilmember Moore said no, the item is on the Consent Agenda, and she would like it pulled for discussion. Mayor Graves asked if other Councilmembers would like to pull that Consent Agenda item. Councilmember Jerzak said he did not need to pull that item. Mayor Graves asked if anyone else wished to pull the item. Councilmember Moore said she would like to discuss it now. Mayor Graves said the floor was Councilmember Moore's. Councilmember Moore asked about the automatic three percent cost of living increase, and she knows that came up during previous budget sessions, and considering the City is a business, she advocated ad nauseam that any employee at the City will get a mandated three percent cost of living increase. She said she knows that employees for the City have merit step increases if they meet objectives in their position, but she did not think there was an automatic three percent increase for any employee, and the only increases that could be are regarding union- negotiated contracts. She asked Interim City Manager Daren Nyquist if it was true that all employees were getting that three percent increase. 03/09/26 -2- Mr. Nyquist said his understanding was that all full-time employees get Cost of Living Allowance (COLA), and part-time employees, for budgetary reasons, did not. He said he and Staff will be reviewing that policy for part-time Staff to get clarity on that, but all part-time employees did get a three percent increase this year. Councilmember Moore asked if all employees have gotten a three percent increase in COLA, no matter what the fiscal outlook is. Mr. Nyquist said he cannot speak to it before his time, and there may be someone with longer historical knowledge who could answer that. Councilmember Jerzak said that is not true, and there were several years that wages were frozen, but it is flexible. He said as a general rule, there is consideration for government employees, but he could not remember a single year that it kept up with the rate of inflation. He said that, having well-paid or fairly paid employees, because the City is far from being the top paying, it is then essential that the City rewards those who are doing their job. He said the three percent increase advocates for market-rate pay. Councilmember Moore said that Councilmember Jerzak said, as a past employee, it is not a guarantee that all full-time employees get a three percent increase, and it is something that would be discussed throughout the budget process. Councilmember Kragness said to go along with what Councilmember Moore is saying, maybe the document should say the salary may include the COLA increase, to give the option, versus being an obligation. Councilmember Moore said that would be perfect. Councilmember Moore said regarding the retention bonus, she knows that the previous administrator may or may not have had a $5,000 retention bonus, and asked if that was in line with the previous Interim City Manager Contract from five years ago. Mr. Nyquist said this is new to him, and he looked to his peers to see what is generally in the contract for an Interim position. He said that a lot of example contracts included car stipends, and for him, that did not fit, but a retention bonus does because having a leader leave out of the blue at this point would be a critical mistake, and that bonus was put in there as a safety net for the organization. Councilmember Moore said it is basically an incentive. Mr. Nyquist agreed and said it is to keep him in this position as a caretaker for the full-time position. Councilmember Moore said she did not disagree with his statement, and asked if that was something that was offered five years ago with the Interim City Manager position. Mr. Nyquist said he could not answer that. Councilmember Moore asked if the current salary of $170,040 per year is the current baseline of a City Manager position in the City. Mr. Nyquist said that was the salary of the previous City Manager, and across all the nearby cities, that salary is actually on the lower end. Councilmember Moore thanked Mr. Nyquist for that clarity because she does not have the chart of the City Manager salaries in front of her. She added that the vacation time is probably in line with another incentive, along with the retention bonus. She thanked Mr. Nyquist and the Council for allowing her time to ask these questions. 03/09/26 -3- Councilmember Kragness asked if the salary is just based on position or if education and experience are taken into consideration, because Dr. Edwards had a PhD and a Master's degree, and that salary is still on the lower end. Mr. Nyquist said it is based on a pay range, and he said he could not tell the Council what the exact range of this position is right now, but the salary is on the lower end of that range. He added that he also has a Master's degree and 15 years of experience, but in terms of being in this new position himself, he said he would be lacking in that aspect. He added that, looking at similar-sized cities with similar budgets, the City Manager's salary is still on the lower end. He continued that taking him out of the Deputy City Manager and into the Interim City Manager position raises it up quite drastically, but he is willing to talk about the salary and stated that he has a Master's degree and 15 to 20 years of experience in the public sector administration. Councilmember Kragness said she was not questioning the salary itself, but was questioning the range because she knows there were issues, even with someone having a plethora of experience like Dr. Edwards had, his salary was still on the lower end, and she wanted to bring attention to that. Mayor Graves thanked Councilmember Kragness for bringing that up because she was thinking the same thing. She asked if there were any further questions regarding agenda items. CITY MANAGER MISCELLANEOUS DISCUSSION ITEMS 2026 DEPARTMENT PRIORITY PROJECT UPDATES Mr. Nyquist explained that he wanted to repeat what the Council did last year, which was sorting and ordering topics of conversation for Council meetings. He said he and Staff put together a list of all priority projects that Departments are working on. He said the Council should be mindful of the limited time space in the agendas, as things are starting to fill up, but wanted to give the Council the opportunity to request any items they may want to see a presentation on from Staff over the next four to six months. He added that the Council will receive an email with 10 different items that they can choose to have a presentation on or hear more about. Once he gets those votes from the Council, he will rank them and propose some agendas for future presentations on topics from Staff across the Departments, and at the next Council meeting, hopefully, the Council will have some agendas to look at. Mayor Graves said that sounded good and encouraged Councilmembers to respond to that email. Councilmember Moore said she did not see an agenda item regarding rental inspections, and previously, it had been brought forward and discussed between her and Mr. Nyquist in their one- to-one meetings. She said he had mentioned that there were a few issues and some clarity was needed around finalizing that to be presented, and asked if the Council had already voted on it. Mayor Graves said the rental license is on the Work Session agenda tonight. 03/09/26 -4- Councilmember Jerzak said the rental license discussion was on tonight's agenda. Councilmember Moore said she missed it in her Council packet because she does not have a Work Session or EDA agenda. Mayor Graves said the agenda was in the middle of the packet. Councilmember Moore said she did not see it, and her packet had part of a presentation duplicated, but it did not include the EDA agenda. She thanked the Council for clarifying that right away. Mayor Graves said she would like to move up agenda item b. City-Wide Water Meter Changeout Plan: Policy Decision Discussion from the Work Session, if the Council agreed to discuss it now. The Council unanimously agreed to discuss it now. CITY-WIDE WATER METER CHANGEOUT PLAN: POLICY DECISION DISCUSSION Mr. Nyquist introduced Public Works Director and Interim Deputy City Manager Liz Heyman to present this item. He noted that Ms. Heyman has been working with the Finance Department to put this plan together, and it is going to take both Departments collaborating to push this out successfully since Utility billing is handled under Finance, and changing water meters and procedures is under Public Works. He added that Dan Tintner from Ellers would be available to answer any technical questions about the water meters. Ms. Heyman said she was happy to finally be giving this presentation in front of the Council and give an update on this use. She said she would be covering water meters specifically in Brooklyn Center and the current status, along with a recommendation of a 10-year replacement plan and a focused plan for year one, and policy items that she would like to discuss with the Council tonight. Ms. Heyman explained that water meters measure how much water flows into the building so the water utility can bill for usage, but people might not know there are different types of ownership of the infrastructure that goes with delivering water from the water treatment plant to a private piece of property. The City owns the water main, which runs directly down the middle of the street, but the private property owner owns all of the other infrastructure from the main into the house, including the curb stop, which is privately owned. She stated the City maintains ownership of the water meter itself, despite it being inside the private property, so the City has a responsibility to maintain the water meter. She noted that the water meters are a joint responsibility between Public Works and the Finance Department, as Finance manages utility billing, which maintains water meter data, bills, and usage, and customer service, like scheduling replacements, while Public Works installs and maintains the water meters. Ms. Heyman explained that the City uses Neptune Water meters with 9,013 total water connections, with two types of water meters. The residential water meters have a 15 to 20 year lifespan, with large industrial or commercial meters having a 10 to 15 year lifespan. The commercial water meters have a shorter lifespan due to the amount of work they do for larger- scale operations like schools, and the harder the meters work, the sooner they fail. The last major 03/09/26 -5- changes in the City were in 2017 and 2009. There has been a long-standing CIP project as a placeholder that was set out to 2028 for a major City-wide change out, and she will discuss why the City is changing course on that, but it is important to understand that the City had always been planning a large-scale change out. She added that the CIP project fund only had $2 million dollars, and when looking at prices, the project was underfunded in that aspect, but was sitting there as a placeholder to address another City-wide change out. Ms. Heyman continued that the age distribution of the meters in the City with about 47 percent of the meters installed in 2017, with some more lifespan left, and with almost 48 percent of the meters installed in 2009, the City is behind replacement by two years, with a possible three years left on those meters depending on where they are in their lifespan for the residential meters. She noted that the commercial meters in the City that were installed in 2017 and 2009 are anywhere from two to seven years behind, where they would expect to see those meters beginning to fail. She noted that overall, there is more time left on the meters installed in 2017, and less time left on the meters installed in 2009. Mayor Graves asked about the number of commercial meters and what percentage of the total that number is. Ms. Heyman asked her which number she was referring to. Mayor Graves said Ms. Heyman had said 282. Ms. Heyman explained that the 282 is the total number of commercial meters that have been installed since 2017. Mayor Graves asked how many new commercial meters are needed. Ms. Heyman asked if she meant how many needed to be replaced immediately. Mayor Graves confirmed that is what she was asking. Ms. Heyman said she would get to that shortly, but thought the total number was 1,672, and would get into more detail, but she did not have the split out between the larger meters versus the residential. Mayor Graves asked what the 3.1 percent on her chart was indicative of. Ms. Heyman said the 3.1 percent is the percentage of commercial meters of the 9,013 total meters. Mayor Graves asked if the smaller percentages were reflecting that the City has done much less of the commercial replacements than the residential. Ms. Heyman said the chart shown is just the age distribution of the meters in the City, not the status of the change-out. Ms. Heyman noted that it is not like these meters just stop working immediately after 10 to 15 years; some can last for 20 to 25 years, but one can expect between that 10 to 15 year range to slowly start to see these meters fail. She said these meters, over time, slowly decline in accuracy and automated reads before there is any known indication that something is wrong with the meter, and all meters become less sensitive over time, which impacts revenue collection. She stated this is why the City needs to be ready to change the meters out earlier, rather than when they start to see them fail. She said it is normal to see a steady share of meters that need troubleshooting, repair, or replacement across the entire system; however, the City is at a larger name than Staff would like to see. She noted that this time, Staff estimates that 18.5 percent of meters in the City, or 1,673 meters, are currently in need of attention. She said that meters that are flagged do not necessarily mean that they are broken; it means a field check is needed to determine what is wrong with the meter. She explained that some meters may be on vacant property that the City does not know about, or a meter is an irrgigantion meter, or the resident is a snowbird on vacation, and there are 03/09/26 -6- a lot of reasons why a meter may be registering in one way or another and the only way to understand why a meter is being flagged is with a field check. Ms. Heyman noted that once a meter is flagged, the billing on the account gets put into one of two buckets: the minimum charge or the historical average. She stated that the minimum charge is implemented after a meter has been flagged for 35 days, and the minimum charge is $35.61 per quarter, which is set in the City's fee schedule. The minimum charge is charged to meters that are reading, but not registering any water flow. She explained that all of the meters are charged quarterly, and of the 1,673 meters that were flagged, 782 (47 percent) are billed at the set minimum, and 891 (53 percent) are billed based on past account historical average. The historical average is used for meters that are not reading at all. Councilmember Moore asked what 47 percent was. Ms. Heyman said 47 percent of the 1,673 meters that were flagged are not registering any water flow. Councilmember Moore stated that half of the 1,673 meters are only paying the $35.61 bill per quarter. Ms. Heyman confirmed that it is correct. Ms. Heyman continued that 53 percent of those meters are being billed on a past historical average, and those meters are the ones that the City is getting an error reading back. She stated that, unfortunately, with the no-flow meters, there could be different reasons why that meter is not registering any flow, so the City does not have a good way to put in an estimated revenue for those. Ms. Heyman continued that there is no good way to estimate revenue loss from accounts billing at the historical average. She stated they did take a look and made some assumptions for the no flow meters specifically, so that is the ones that are still reading but not registering water flow, and the assumption is that 18,000 gallons of water are being used per quarter which is about 6.4 percent of the City’s annual water user revenue, then the City is losing $318,000 of revenue per year from accounts billing at the set minimum. She said that is the largest number that they currently know because they had the help of the Ellers team to go through the data and figure out how many meters are in each bucket being billed at the historic average or the minimum. Mayor Graves asked if the Council had any questions before Ms. Heyman continued. Councilmember Moore asked if this means that 782 households are only being billed $35.61 per quarter, and are not even being billed based on a historical estimate, and if that is included in the $318,000. She asked if this goes back to 2017, because she has a hard time believing that the lost revenue only totals $318,000 revenue a year, with both the historical average, and the households that are only paying $35.61 a quarter. Ms. Heyman said that is not what she is saying, and since 2017, the assumption would be that meters continue to fail, as that is almost the entire lifetime of a meter. She said, based on the best information that she has today, when the reports were pulled a month ago, data showed that 782 meters had no flow, but this data is not going back to 2017. Ms. Heyman stated that there is no good way to estimate the historical average because residents could be using more water or less, depending on a lot of different choices within the household. 03/09/26 -7- Councilmember Moore said she understands not being able to estimate the historical average, but going back to 2017 or almost 10 years ago, looking at best estimates as of today would include $3.18 million of total lost revenue. Ms. Heyman said no, there was a rough analysis, and the only number that she can tell the Council as of today, without a good understanding of failure rate, and after pulling the data with the help of Ellers, is the number of meters that have no flow, and the number of meters that are not read. Ms. Heyman said she cannot tell the Council of those 1,600 meters how many failed within the last six months, or if they all failed in 2022 when the City did the last change out, and she unfortunately does not have the ability to do that because the data was not being tracked in that way. Councilmember Moore thanked Ms. Heyman for that clarification and said the Council does know that there has been significant revenue loss because, over time, there has been a failure in the actual usage of the meters. Ms. Heyman said the City has lost revenue, whether that is significant would be difficult to say, because they have not been tracking the failure rate and what the definition of significant is. She stated that the $318,000 is 6.4 percent of the City's annual revenue for water. Councilmember Moore said that $318,000 is per year, though. Ms. Heyman said that is correct, and the 2024 audited amount was approximately $4.9 million in terms of revenue brought in. Councilmember Jerzak asked if the $35.61 being billed per quarter reflects the last two years of significant increases in utility billing. Ms. Heyman said she would have to ask when the last time the minimum charge was updated. Councilmember Jerzak said he was going to come back to that for discussion later about the policy, because he wants to know if that minimum charge was reflected in the increases. He asked about the meters being charged using a historical average, and if that resident is receiving a senior citizen discount on their water bill, how they can be sure they are still getting that discount versus being charged the historical average. Ms. Heyman said the resident would receive the discount off the amount they are supposed to be billed, and would have to call in to confirm their individual account has the discount being applied. She asked if she was misunderstanding Councilmember Jerzak's question. Councilmember Jerzak said if the resident applied for the discount, was eligible and got it, but has a no-flow meter, and is assigned the historical average, that could be significantly higher than the senior citizen discount they were receiving. He said they could also read the paper where the Council opted to raise the water utilities by 20 percent, and may not be billed correctly. Ms. Heyman said she would have to rely on the Utility Billing Department and get back to the Council on that question. Councilmember Jerzak said that it is fine; he just wanted to bring it up because it is a fairness thing, and if it is offered, it should be honored. Ms. Heyman said the main question Staff have been asking throughout the entire process is whether addressing the revenue shortfall in 2026 will bring down the water utility rates that have been projected for 2027 and 2028. She said Ellers has been extremely helpful in giving a rough analysis of this, and unfortunately, even if the City assumes to inject this revenue into the 2026 or 2027 water utility fund, it will still be in the negative. She said the aggressive and substantial increases in the short term are still warranted for the water utility fund. She stated that the water utility fund would still be in this position, even if all the water meters had been fixed and they were bringing in that lost revenue. 03/09/26 -8- Ms. Heyman said Public Works has long known that there would have to be some large change- out project after they did one in 2009, and took a look at the meters again in 2017. The perspective is not to do one large change out, because all the meters would fail at once, which is not a good spot to be in from a technical and workload revenue perspective. She stated that Staff is recommending a 10-year change-out plan instead, changing out 1,000 meters per year, with all the meters that were installed in 2009 being replaced from 2026 to 2030, because those are the oldest meters within the failure range. She continued that from 2032 to 2035, all the meters from 2017 would be replaced, with an estimated cost including a two percent inflation added on to the current cost. She added that a 10-year replacement plan, instead of one large replacement plan, avoids that future replacement cliff, creates a steady state moving forward, and reduces the number of meters that are expected to fail in any given year. It is also a better way to manage the system and keep the program within the current budget capacity. This plan would keep spending steady across those years, so there would not be a large payout that needs to be made over one to two years to change all the meters out at once, which would cause utility rates to increase. This plan would ensure that the water meter change institutional knowledge is kept current, so Staff have an understanding year after year of how this works, who the City works with, and how the process is done. She added that revenue protection is the priority, and in 2026, all meters that are billing at the minimum rate would be changed out within year one, and focus would be on the large commercial and industrial meters to be replaced that have the most potential to have the largest revenue loss. She continued that the plan would be iterative based on utility billing data that the City has, and would work out some sort of process to understand what the meter failure rate is. As these meters age, one would expect more to fail every year, but now the City would be able to track and understand that failure rate and adjust the plan as it moves forward. Ms. Heyman noted that for year one of the 2026 replacement plan, a project of this size and scope must be consulted on. Public Works does not have enough Staff to change out this many water meters and continue day-to-day operations. She stated that there is a contract between the City and the water meter vendor Ferguson, who is the lead consultant. Ferguson sub-consults with a company called RMR Services, which runs all the customer interactions like sending letters, setting up appointments, and sends a RMR staff member to change out the meter. She added that customers do not pay an additional individual fee for having their meter changed out. She said she hesitates to say that this project is free, but if a resident is chosen in 2026 to have their water meter changed out, they will not be charged an additional fee for that change-out. Ms. Heyman said a rough timeline for year one of this project, once it gets kicked off, is one to two months for customer data entry and the first notice preparation, and then three to six months for installations. She said the City will be working closely with RMR to understand what progress they are making, and how quickly this can get done, because it will impact how this project moves forward over the next 10 years of planned replacements. She continued that the total project cost in 2026 is $516,618. This total includes $395,920 for meters and radios and $120,698 for installation and consulting services with RMR and Ferguson. 03/09/26 -9- Ms. Heyman noted the plan for property owner notification, which includes targeted letters to the property owners and the property itself. This plan includes letter one, in which the customer is notified and asked to schedule an appointment. The replacement visit typically replaces both the indoor meter and the outside radio/endpoint, and some setups require running wire to an outside mount location. The 2009 meters that do not have a radio will receive one as part of this upgrade to take in readings. If a property owner does not schedule that appointment, a second letter will be sent two weeks after the first letter, and a third letter will be sent two weeks after the second. A fourth letter plus a field notice will be sent two weeks after the third letter and includes hand delivery, a door tag, and a 24-hour warning that water service at the property will be restored if Council approves, along with a yard and curb stop flag placed. She stated that generally, after a door tag and a flag are put in the yard, that is the last notice that someone needs; however, in some cases, it has not happened. Ms. Heyman asked if the Council supports using a water shutoff as the enforcement backstop when a customer does not provide access for a required meter replacement. She said her follow-up for Council to discuss is whether, if the shut-off valves fail during changeouts, the City should pay for plumber services to repair or replace broken valves so a change-out can proceed. Ms. Heyman said she will discuss these options one at a time before the Council discusses. She noted that if there is still no response after the final notice, the City has the authority to shut off water services until the account holder schedules a meter change-out. She noted that without running water, a dwelling may be considered uninhabitable under common health and safety standards. If the nonresponsive property is an apartment, hotel, or commercial building, Public Works Staff will coordinate with the Fire Department before shutting the water off. She stated she does not think those types of properties will be as likely to have issues, since the City has more ways to get in contact with those property owners or the property managers. If it is a residential property, it is sometimes more difficult. She added that after the water is shut off, the customers must call RMR to schedule a meter change-out, and RMR prioritizes scheduling these shut-off cases to minimize time without water. The customer would have to pay water restoration fees, which are $31 Monday through Friday from 7:30 AM to 3 PM and $83 after hours, weekends, and holidays. She stated that if the Council supports this as a backstop, Public Works would coordinate with RMR to schedule a shut-off at a time during the week, so the water is not shut off on a Friday at 4:30 PM. She noted that considerations are made for a rental property if the landlord is not responding, and anyone over the age of 18 can schedule a meter replacement, and does not have to be the account holder. Rental properties will also be addressed by sending notices to the property address and the property owner's address. The City will be pulling county property records and address data in order to mail notices to both the property and the owner, if the addresses do not match up. Ms. Heyman said she would stop there and ask the Council what they would like to enforce as part of the change-out process. Councilmember Moore said she is in full support of using a water shut-off as a backup for the customer. She asked if Ms. Heyman would like her to weigh in on the second question now as well, or just the water shut off. Mayor Graves said the Council should address one at a time. 03/09/26 -10- Councilmember Jerzak said he respectfully disagrees and thinks there are better alternatives, having a lot of experience shutting off water in vacant properties. He said his concern is that in the times that they are living in, people may be very afraid to come to their door. He said the quickest way he can think of for people to schedule a change-out is to tell them the minimum rate will rise to $150 if they do not schedule a change-out. He stated that doing that still gives the City the opportunity to change the meter, versus shutting off the water, which is pretty drastic, especially if a resident is a snowbird or in rehabilitation, or there is the rental aspect that was discussed, or there is a sprinkler system or a warning or flow system involved. He said for those reasons, there are other ways to accomplish getting the water meter replaced. He said the Council also needs to discuss reinspection fees, and the average cost of a plumber is $600 to $700 to repair the shut-off valve if it breaks. He said he wanted to hear thoughts from the rest of the Council before he continued, but he is not in favor of shutting off the water and thinks there are other ways that the City can accomplish this. Ms. Heyman said other cities have used fines to accomplish this; unfortunately, under the City's current ordinance, they do not have the authority to levy a fine in this situation. She stated that the Council could propose an ordinance change, but that would take time and delay the start of the project. Councilmember Jerzak asked if the Council would have the authority to raise the minimum charge. Ms. Heyman said she would have to defer to the City Attorney on that. City Attorney Siobhan Tolar asked Councilmember Jerzak to specify what he means by minimum charge. Councilmember Jerzak said he understands that the fees are set in January. Ms. Tolar asked if he meant the minimum charge in the fee schedule for water rates. Councilmember Jerzak said yes and asked if the City could add a line to the bill that states that if the customer does not schedule a water meter change, then the minimum fee will be changed. Ms. Tolar said that would be a punishment and a fine, not a fee, and she would have to do some research on that. She stated she does not think the City can raise the fee schedule for people who do not pay their water utility without some type of legislative action, such as a resolution or an ordinance. Mayor Graves said she had not thought of the fee or fine idea, but the idea of shutting off somebody’s water does not resonate with her at all because residents should have a right to water. Mayor Graves said there does not need to be a debate about her opinion, and she does not support this personally. Councilmember Kragness said she does not support turning water off, but would be more in support of a fine or something along those lines. She said she wanted to reiterate that the loss of revenue right now is lower than the potential failure rate of doing a mass meter change, and that is the reason that the City is doing this in cycles, versus all at once. Ms. Heyman said that just like the CIP, where they build streets in different years to avoid a mass infrastructure failure all at once. Ms. Heyman said the City would spread out the installation date for these meters, so they do not all fail at once ten years after installation, and there would be a larger spread of meters of different ages. 03/09/26 -11 - Councilmember Lawrence-Anderson said she would like to find a better way than to shut off the water, and she is all about cause and effect. Residents need to schedule the replacement, but shutting off the water is a bit drastic. Councilmember Moore said the City has been looking at 10 years of individuals charged $35.61 a quarter, and as Ms. Heyman said, once the resident receives their final notice, they actually call. She asked if the Council is going to continue to let x number of people pay the minimum, and not get their water shut off or have some consequence if the City cannot fine them. Mayor Graves said the Council is talking about potential other consequences. Councilmember Moore asked why Mayor Graves is interrupting her. Mayor Graves said she is trying to debate the topic. Councilmember Moore asked for a point of order. Mayor Graves said she has heard the consensus of the Council, and Councilmember Moore is trying to relitigate something that she already had the chance to say. Councilmember Moore said she heard Mayor Graves say under her breath that the Council does not get to have a disagreement. Mayor Graves said she is not disagreeing with Councilmember Moore. Councilmember Moore asked if she could continue to make her point. Mayor Graves asked if it was a new point or the same point that was already made. Councilmember Moore asked if Mayor Graves is telling her what she can and cannot say on the dais. Mayor Graves asked if Councilmember Moore was going to restate the same thing. Councilmember Moore said she would yield, but this is inappropriate for the Mayor. Mayor Graves said Councilmember Moore is not going to keep bringing up something again and again. Councilmember Moore asked for a point of order and for the Mayor to move on. Mayor Graves said she was moving on to question number two and called on Councilmember Jerzak. Councilmember Moore said this is unbelievable. Mayor Graves asked Councilmember Moore to stop talking and interrupting. Councilmember Moore told Mayor Graves to stop talking. Councilmember Jerzak asked Ms. Heyman to restate what the second question was, for the record, and would follow up with his thoughts. Ms. Heyman asked the Council, before moving on, if there is going to be a fine set, and how much the fine should be. She said she could share that when St. Louis Park did their meter change-out a fair bit ago, they were charging $300 per quarter for the fine itself. She said she is interested in what the Council would like to do, so there does not need to be another Work Session on that, and Staff can work on that ordinance change. Mayor Graves said she would defer to Staff to do the research around fines in other cities that are comparable. Councilmember Jerzak said he would not be against that, and the City does not have 03/09/26 -12- to reinvent the wheel on that. If it is going to take one to two months to get the letters ready to be sent out, he thinks the Council can get an ordinance back or a resolution in time to establish what the fine would be. Councilmember Lawrence-Anderson said she would defer to the Staff's expertise and recommendation regarding the fines, and the whole purpose is to get into a property and replace the water meters, and the City does not want to penalize, but if the penalty is significant enough, it will get the resident's attention. She said her hope is that the message to residents will be that they are given a number of days to get the water meter changed, or they will be charged a fine. Councilmember Krangess said whatever the fine is, it will likely be a lot more than what the resident would be paying for water, so it would make more sense to get the meter changed out versus paying a $300 fine. Ms. Heyman added that St. Louis Park also stated that if the resident scheduled the change-out within a certain amount of time, then the fee would be waived. She said her point is that this is not going to be a massive revenue generator, but the City has to make sure that the infrastructure that they own is in working order and get into these properties to make the changes, and that is the goal. Councilmember Moore said one question Councilmember Jerzak brought up was whether the utility water increases applied to the minimum charge and the estimates. She stated that the City has been aware of the challenges with the water meters, and for two years has increased the water utility rate by 20 percent each year. From a common-sense perspective, why would the minimum rate charged not increase by 20 percent each year, as well. She stated this was not brought to the Council last year, and it may be a drop in the bucket in the lost revenue, but it would have been about treating everyone in the City equally when it came to paying for water, if everyone got the increase. Mayor Graves said the Council should address the second question regarding shut-off valve failures. Councilmember Lawrence-Anderson said the City owns the water meters, and if something fails in the process of installing a new meter, she does not like it, but it would not be the resident’s fault for it failing unless it was abused or damaged. She said to make it brief, the City should pay for it. Councilmember Jerzak said he respectfully disagrees. He noted that the valve in question is inside the home, and should be part of home maintenance, and this is not about the valve in the yard. Councilmember Lawrence-Anderson said she knows, but the City owns that meter. Councilmember Jerzak said when looking at the provided diagram, the responsibility of the shut- off valve, which is on the opposite side of the meter, is with the homeowners. He said his only point is that he has paid the $600 fee when he had to hire a plumber, and this is part of maintenance, and the City cannot be paying for all of these, and it is part of owning a home. He added that the City does own the meter, but the meter is inside the home, and the shut-off valve is like plumbing 03/09/26 -13- in the house and is the homeowner's responsibility. He said if the shut-off valve fails, he does not think the City should be paying for that, but maybe there could be some type of payment plan set up, or the worst thing is the City could also assess it at the end of the year. He said he does not know what kind of exposure the City has; these shut-off valve systems could be 70 to 90 years old, and some of them have never been touched and would be an unfair exposure to the City. Councilmember Moore said two years ago that her shut-off valve failed, and she paid $780, and it was her responsibility. She said the City was very clear that the valve was leaking, and with the corrosion, it was her responsibility to pay for the plumber. She said it could certainly be assessed, but it is the homeowner's responsibility, and she was clearly told that when she had to replace hers. Councilmember Kragness asked how the City can enforce that. She stated that as a homeowner, if a part breaks, the City cannot force them to get it fixed, and if the homeowner does not get it fixed, it will interfere with the City's water meter. She said that unless the City assesses that charge, they cannot force someone to get anything repaired in their home. Ms. Heyman agreed and said the City cannot force the homeowner to repair it, but in this specific alternative, if the valve is stuck in the off position, the homeowner does not have water, so the homeowner would almost certainly have to call a plumber. Ms. Heyman said if a water meter change is scheduled and RMR comes out, and the valve does not turn and gets stuck in the on position, then staff could use a freeze kit, which freezes the pipe for a small amount of time, make the change out, and it is done. She added that RMR would turn to the homeowner and tell them that during the change-out process, the valve is now broken, but is in the on position, so the homeowner would still have water. In most cases, RMR would leave because the meter is changed, and it now becomes the homeowner's responsibility to fix the valve. She added that in some cases, though, the valve gets stuck in the off position, and the meter can still be changed, but RMR would walk out, and if the homeowner has taken off work and now has no water and has to call a plumber or potentially reschedule the meter change out, the City would be receiving a lot of calls. She stated she wanted the Council to be aware of what the implications are for that. She said both Councilmembers Moore and Jerzak are correct, that the valve is owned by the property owner. Mayor Graves said she has replaced the shut-off valve in her house, and it was one of the first things she did when she moved in. She said she would be a bit more nervous about the valve out in the street, because that one is a lot more expensive, but the Council is not talking about those. Ms. Heyman confirmed that those are not the types of valves that they are discussing. Mayor Graves said she does not think the City should foot the bill for this, although she hopes that the valve does not break and it does not happen to too many people. She asked if the valve had gotten stuck in the on position, and RMR used the freeze method and got the job done without having to pay the full $600. Ms. Heyman said the freeze kit is an option, but there is no guarantee that it would work every single time. Mayor Graves said she recognizes that, but at least that would be an option, and at a lower cost. Ms. Heyman said she would need to work with RMR and confirm that their staff is trained in the freeze kits and have them available, or it may be an instance where Public Works sends out Staff to take care of it. Mayor Graves said she wanted to ensure that if it is an option, it is available for folks who may be struggling with finances, and could get 03/09/26 -14- the valve replaced when they are in a better financial position, but if a lower cost option is available, it should be offered. Mayor Graves said that was all the time they had for the Study Session. She said she would call the Regular Session to order and may take a quick break later. ADJOURNMENT Mayor Graves adjourned the Study Session at 7:05 p.m.