DEEPHAVEN CITY COUNCIL MEETING

MONDAY, JUNE 4, 2007

MINUTES

1. CALL MEETING TO ORDER: Mayor Paul Skrede called the meeting to order at 7:02 p.m.

PRESENT: Mayor Paul Skrede, Councilmembers John Wheaton, Steve Adams and Keith Kask

ABSENT: Councilmember Kim Crockett

STAFF: Police Chief Virgil Gustafson, Zoning Coordinator Gus Karpas and City Administrator

Dana Young

2. PLEDGE OF ALLEGIANCE

The Council recited the Pledge of Allegiance.

3. APPROVE CONSENT AGENDA

Councilmember Kask requested that Item No. 3.F. Adopt Resolution No. 13-07, Authorizing a Public Hearing on Tax-Exempt Bond, be pulled from the consent agenda.

Motion by Councilmember Kask to approve the Consent Agenda, consisting of the following items:

A. Minutes of May 21, 2007

B. Approve Verifieds

C. Approve SafeAssure Contract

D. Approve Request for July 4^th Contribution ($1,200.00)

E. Approve Purchase of Copier

Seconded by Councilmember Wheaton. Motion carried 4-0.

Mayor Skrede stated that he and Administrator Young had been approached last week by Steve Fenlon of MHC, who was representing the Excelsior Covenant Church (ECC) with a request for the City of Deephaven to issue a $2.5 million tax-exempt revenue note on behalf of ECC. He stated that ECC is solely obligated to pay the debt service on the note, which would be secured by a first mortgage on their property. He stated that the City does not have any liability on the note but the principal amount of the note will count against the City’s annual $10 million bank qualification bond limitation.

Mayor Skrede added that negotiations with ECC included payment to the City at closing of ½ of one percent of the principal amount of the tax-exempt note and payment of $2,500 to the City for public notice costs and attorney fees. He added that the City would refund ECC if the actual costs incurred by the City were less than $2,500 or the City would bill ECC for any additional costs that were incurred above $2,500. He stated that in the event ECC decided not to proceed with the bond issue, the City would keep the $2,500.

Councilmember Adams stated that he is a member of Excelsior Covenant Church and did not intent to vote on this matter. Mayor Skrede added that this offer from ECC was not brought to us or solicited by Councilmember Adams.

Motion by Councilmember Kask to adopt Resolution No. 13-07, A Resolution Authorizing a Public Hearing on a Tax-Exempt Bond for Excelsior Covenant Church. Seconded by Councilmember Wheaton. Councilmember Adams abstained. Motion carried 3-0-1.

4. MATTERS FROM THE FLOOR

Mayor Skrede introduced Congressman Jim Ramstad, who was present this evening to recognize the contributions of retiring Police Chief Virgil Gustafson. Congressman Ramstad stated that he was here this evening at the invitation of Mayor Skrede to say thank you to Chief Gustafson for serving the citizens of Deephaven with distinction for 29 years. Congressman Ramstad congratulated Chief Gustafson for all his work with young people in the CounterAct Program, for his legacy of protection and service to the community and wished him all the best in his retirement. Congressman Ramstad presented Police Chief Gustafson with a Certificate of Special Congressional Recognition and with the flag that had flown over the Capitol Building on May 1st.

On behalf of the Council, Mayor Skrede thanked Congressman Ramstad for his presentation to Chief Gustafson and for his special appearance this evening.

5. PLANNING & ZONING REQUESTS

Variance – Deephaven Elementary School, 4452 Vinehill Road, R-2, 40,000 – The applicants are requesting to create an outdoor classroom in an existing courtyard which would exceed the maximum permitted impervious surface. The existing impervious surface area on the property is 33.7%, the requested variance is to increase the overall impervious surface percentage to 34.3%.

Zoning Coordinator Karpas reviewed his staff report. He said the request is to create an outdoor classroom within the existing courtyard area. The total impervious surface area on the property would be 34.3%, but that the increase caused by the proposal would be less than one percent. He said he recommended approval of the request saying that the unique use of the building, required parking and the reasonableness of the use meet the variance criteria. He noted that the essential character of the neighborhood would not be altered since the proposal would not be visible outside of the school.

Karpas said that only one letter was received regarding the project. It was from Joel Stebbins, 19000 Ridgewood Road who did not support the project and felt that the school should be held to the same standards as developers.

Councilmember Adams gave the Planning Commission report. He said there were questions about the stormwater runoff and how the water would leave the area. The Commission was made aware that there is an existing stormwater system in place in the courtyard that would be able to handle the runoff caused by the proposed impervious surface area. He said the Commission voted unanimously to recommend approval of the request.

Mayor Skrede asked if the Planning Commission addressed the submitted letter from Mr. Stebbins. Councilmember Adams said it was discussed but the Commission felt the unique use of the property and the fact that the actual increases in impervious surface were grounds for approval.

Mayor Skrede opened the request for public comment, hearing none; the public hearing was closed.

Councilmember Kask moved to approve the variance request to exceed the maximum permitted impervious surface area by 9.3% for the proposed outdoor classroom, as presented, at 4452 Vinehill Road, in accordance with the recommendations of the Planning Commission and City Staff. A hardship exists in the unique character and use of the building, requiring additional impervious surface and the proposed use would benefit a large portion of city residents. Seconded by Councilmember Adams. Motion carried 4-0.

FINAL PLAT – Mark Kawell, Manor Road, (R-2, 40,000) A final plat request to subdivide an existing property located in the cities of Deephaven and Shorewood into four lots. The plat would create three vacant lots in the City of Deephaven. The property included 20025 Manor Road, Shorewood and the property directly south and east of 20025 Manor Road.

Zoning Coordinator Karpas presented the request and reviewed his staff report. He said the City Attorney sent an email outlining six conditions that should be attached to any recommendation for approval. Karpas read the conditions into the record. He said the physical layout of the Final Plat has not changed from the Preliminary Plat, the concerns raised by the attorney center around specific language describing the various easements on the property.

Mark Kawell was available to answer questions.

Mayor Skrede opened the request to public comment, hearing none; the public hearing was closed.

Councilmember Kask discussed the required setbacks for the R-2 District and observed that the final plat shows that at least one of the lots, lot three, appears not to comply with the required front yard setback. Mr. Kawell said the final plat was developed based on the comments of the City Council in December, where in exchange for a completely looped road, lot three would be permitted a reduced setback to twenty-five feet from the edge of the bituminous surface. Kask said he recalls the discussion but questions, from a philosophical standpoint, that even though the proposed road is a private driveway, why isn’t there a required fifty-foot front yard setback.

Mayor Skrede asked if Kask was asking to have the setbacks shown on the final plat. Kask said when the Council looks at issues such as these, it needs to be known whether future variances will be required. Skrede asked if Kask would prefer that a specific alternate setback for lot three be clarified in a motion. Kask said he would prefer to see the required setback be met regardless of the type of road used to access the property.

Mr. Kawell reiterated that the design was based on the past discussion. He noted the original plan had terminating streets, allowing all the lots to comply with the required front yard setbacks. The issue on lot three was created by the city’s desire for a through street. He said that the City of Shorewood and the Minnehaha Creek Watershed District (MCWD) have approved the plan. He said a conservation easement has been created on lot four to help mitigate runoff issues caused by the additional impervious surface added to the property.

Councilmember Kask said if the plat before the Council is to be accepted the applicant will have to agree to a specific setback on lot three. He agreed the addition of a through street benefits the city and the properties. He feels this issue must be clarified and a practical difficulty stated for the record. He believes it is important to state a specific setback, not only for this request, but also for the future as this lot is redeveloped.

The Council discussed what a reasonable front yard setback would be. Kask feels the agreed upon setback must allow for enough area so that at least three off street parking areas are created. This is important since the proposed road would have a parking restriction on it. He said he supports the division of the property provided there is a clarification on the building pad on lot three and that adequate off street parking be shown for all properties.

Mayor Skrede asked if twenty-five foot would be acceptable. Kask said it would be acceptable, given the fact that the applicant has redesigned the road for better emergency access. Zoning Coordinator Karpas clarified that the proposed road is shown as an easement and that the setback should be required from the edge of the bituminous surface.

Zoning Coordinator Karpas said there were two other issues that need to be addressed pertaining to this request. The first is the condition that no building permits be issued until the road has been installed. He said that Mr. Kawell requests that the condition state that no Certificate of Occupancies be issued until the road is completed and inspected. His concern is the potential for damage to the street during construction. The Council understood the concerns of Mr. Kawell as they relate to damage to the road and had no issue with changing the condition on the installation of the road.

The second issue is the matter of Park Dedication. Typically cash is accepted in lieu of a land donation. The cash value of a Park Dedication is based on ten percent of the assessed value. In this case, the assessed value of the lots in Deephaven is 1.1 million dollars, which would require a dedication of $110,000.

Mark Kawell discussed the Park Dedication stating that he created a seventy thousand square foot conservation easement, fourteen thousand square foot of that area was buildable. He was hoping that the city would see the benefit in that easement when considering the required Park Dedication amount.

Councilmember Wheaton asked how the city historically handled Park Dedication. Mayor Skrede said that the city has been consistent in applying the ten percent formula on Park Dedications, most recently with the Deephaven Cove development. He would have no problem rounding the number to $100,000.

Councilmember Wheaton said in fairness, there would need to be justification to lower the amount.

Councilmember Kask said that park use can be broadly defined and that the request to create three new parcels appears that the property is being developed to its densest use. He feels the Council has been generous in its review of the final plat and thinks the Park Dedication should stay at ten percent of the assessed value.

Mr. Kawell said he believes more lots could have been developed and felt they were doing the right thing in only creating three. He said this request is different from others in that he is putting in a private road and utilities, at his expense. He noted there would be no additional use of public facilities and no additional public burden. He feels this should be reflected in the Park Dedication fee.

Councilmember Adams welcomes the conservation easement, but doesn’t see it as a public benefit. He sees no reason to deviate from the ten percent requirement. Councilmember Wheaton agreed.

Mr. Kawell asked how the assessed value was determined. Zoning Coordinator Karpas said the City Assessor provided the numbers. Mayor Skrede suggested that a meeting be set up with City Staff and Mr. Kawell to verify the numbers. He said the Park Dedication would be ten percent of the value determined at that time.

Councilmember Kask moved to approve the final plat request for Bowman Third Addition to subdivide an existing property located in the cities of Deephaven and Shorewood into four lots, as presented, subject to the conditions outlined by the City Attorney and that no building permits be issued until the concerns raised by the City Attorney and City Engineer are satisfied, as presented, in accordance with the recommendations of the Planning Commission and City Staff. The motion is further conditioned that the Developer identify the front yards on each of the properties and that the front yard setback on lot three be no less than twenty-five feet as measured from the edge of the bituminous road surface, that the Developer identify a minimum of three off street parking spaces containing an area of two hundred and fifty feet per spot for each parcel, that the Developer provide documentation of MCWD approval, that all issues pertaining to easements be approved by the City Attorney and City Engineer prior to the signing of the final plat, that the Park Dedication fee will be ten percent of the determined value by the City Assessor and that no Certificates of Occupancies shall be issued until the installation of the road has been completed and approved by the City Engineer. Seconded by Councilmember Wheaton. Motion carried 4-0.

Variance – Dan and Marta Snow, 20355 Summerville Road, R-3, 20,000 – The applicants are requesting to build a porch addition over an existing non-conforming structure within the required side yard setback. The applicants are seeking to exceed the maximum permitted impervious surface. The requested variance is for five feet of the required fifteen-foot east side yard setback.

Zoning Coordinator Karpas reviewed his staff report. He said the request was to construct an unheated porch addition over an existing flat roofed garage which would encroach five feet into the required east yard setback and exceed the maximum permitted impervious surface. He noted that the proposed encroachment would be less than that of the garage the addition would be built on and that there would be no actual increase in impervious surface, but since the configuration of the impervious surface was being altered, a variance is required.

Karpas said he recommended approval for the request based on the size of the lot, which is approximately one third the minimum required size for the R-3 District and the placement of the existing home, which was built in 1924. He noted the applicants were looking to capture a cottage feel with the remodeling of the home, which is in keeping with the character of the neighborhood.

Mayor Skrede opened the request for public comment, hearing none; the public hearing was closed.

The Council was supportive of the request.

Councilmember Kask moved to approve the variance request to encroach five feet into the required fifteen foot east side yard setback and to exceed the maximum permitted impervious surface area by 10.7% for the proposed porch addition, as presented at 20355 Summerville Road, in accordance with the recommendations of the Planning Commission and City Staff. A hardship exists in the narrowness of the lot and the condition of the existing structure, due to water infiltration problems, which will be alleviated with the proposed addition. Seconded by Councilmember Adams.

Councilmember Wheaton asked if a condition should be placed on the approval that the porch not be converted into year around living area. Councilmember Kask said he’s not inclined to place such a restriction on his motion since there is a proven hardship with the current lot conditions which limits the ability to create livable space.

Mayor Skrede called the question. On a motion to approve the variance request, motion carried 4-0.

Variance – Stonehenge USA, 18158 Minnetonka Boulevard, C-1, 10,000 – The applicants are requesting to construct a new commercial structure on the site of the old Woody’s Mobil station. The proposed structure would encroach two feet into the required twenty-five foot exterior (corner lot) side yard setback along Maplewood Road. The applicants are also seeking a variance to exceed the maximum permitted impervious surface area by 51.5%.

Zoning Coordinator Karpas reviewed his staff report. He said the applicants were seeking to construct a new commercial structure on the corner of Minnetonka Boulevard and Maplewood Road. The applicants require a special use permit, which is a standard requirement for the development of any commercial property in the city. In addition, the applicants are seeking a two-foot variance of the required corner lot, side yard setback along Maplewood Road and a variance to exceed the maximum permitted impervious surface by fifty-one percent. He said the structure would comply with the minimum required east side yard setback, the front yard setback and rear yard setback. He said the structure complied with the maximum permitted height requirements and exceeded the minimum required parking area.

Included in the overall request is a request that the city vacate a ten-foot portion of a thirty-three foot right-of-way easement along Maplewood Road. The size of the building would be greatly reduced without the vacation of the easement since construction is not permitted within any city owned easement.

Karpas said he recommended approval for the special use permit and both variance requests. He said the proposed use is reasonable and that the property is unique in that the costs related to its development is elevated due to past contamination issues associated to the previous use on the site. The proposed use would be an enhancement to the neighborhood. In terms of the request to exceed the hardcover requirements, the property would essentially be un-developable due to the city’s parking requirements.

Councilmember Adams presented the Planning Commission report. He said there was extensive discussions on the whole project. The Commission was in support of the request, including the vacation of the easement. He noted that no one was able to determine the origin or purpose of the easement. The Commission discussed the access issues related to the development and felt that the proposed access onto Maplewood Road was the most appropriate means of access. They discussed the concept of underground parking and noted those previous requests before the city always sought a variance of the parking requirement, but that this one was in compliance. They liked that the plan provided a buffer zone, with plantings between the proposed parking area and residential properties to the north. They also liked the proposed storage of the dumpster within the structure itself. Since the building will be owner occupied, it was felt the property would be kept in an attractive manner.

The Commission discussed signage. There would be no monument sign; rather the applicants are proposing an eighteen square foot corner stone centered on the façade of the building with all other signage attached to the building. The project has a unique stormwater drainage system in which water is stored on the roof of the structure and dispersed over time to the drainage system on the ground.

Councilmember Adams said a number of neighbors spoke at the meeting, voicing their support. The issue of lighting was discussed. The applicant submitted information indicating that very little light would be leaving the property.

The last discussion item was related to the past pollution issues on the property. The applicant is requesting closure from the Minnesota Pollution Control Agency and will have continued monitoring of the site during excavation to mitigate any remaining polluted soils.

The applicant indicated that they intend to close on the property as soon as they receive city approval and plan to break ground in July and hopefully completing the structure by December.

Councilmember Wheaton asked about the issues raised by the City Engineer in terms of the parking spaces on Minnetonka Boulevard and the proposed stormwater drainage system. Zoning Coordinator Karpas said the two parking spaces on Minnetonka Boulevard are existing and not part of this request. He said the City Engineer called him earlier today regarding the stormwater system and said that any motion for approval should contain a condition requiring a final Engineer sign off on the project.

Mayor Skrede opened the request for public comment.

Dave Anderson, Decorator’s Services, 18246 Minnetonka Boulevard, feels the request is a first class project and he strongly supports it.

Hearing no further public comment, the public hearing was closed.

Alan Dale, 19350 Walden Trail, said he is a fourteen year resident of Deephaven and enjoys living in the community. He has formed a personal attachment to this property. His intention is to construct a thirteen thousand square foot building on the property, which would be owner-occupied with some additional lease space available. He would like to see the property developed in a manner which the city can be proud of. He said Gary Tushie, Tushie-Montgomery Architects and Dave Carland, Executive Vice-President of Stonehenge USA were available to answer any questions the Council may have.

Councilmember Kask said that this is the third building the city has considered for this site over the past number of years, which gives most of the Council some insight on the issues and limitations related to the property. He feels what has been proposed has addressed those limitations. He is supportive of the request.

Councilmember Adams supports the request. Councilmember Wheaton feels the proposal would be a great improvement for the corner and likes the proposal.

Mayor Skrede likes the idea that the structure would be constructed and occupied by a local resident.

Mayor Skrede noted that there are two separate applications associated with the structure. The first being the vacation of a portion of the right of way easement, the other dealing with the special use and variance requests.

Councilmember Wheaton moved to adopt Resolution 12-07, vacating the easterly ten feet of the thirty-three foot right of way easement along Maplewood Road. Seconded by Councilmember Kask for discussion.

Councilmember Kask suggested an amendment to the motion that it be conditioned that the approval is subject to and tied to the request before the City Council by the applicants. If the proposed construction were not done, the approval would be null and void. Councilmember Wheaton accepted the amendment.

Mayor Skrede called the question on the amended motion to approve. The motion carried 4-0.

Councilmember Adams moved to approve the variance request to encroach two feet into the required twenty-five foot exterior (corner lot) side yard setback along Maplewood Road and to exceed the maximum permitted impervious surface area by 51.5% for the proposed commercial structure, as presented at 18158 Minnetonka Boulevard, in accordance with the recommendations and findings of the Planning Commission and City Staff. Seconded by Councilmember Wheaton. Motion carried 4-0.

Mayor Skrede asked that the City Council be notified when the issues addressed by the City Engineer have been satisfactorily resolved.

6. UNFINISHED BUSINESS

A. Review 2007 Budget Schedule

Administrator Young presented the 2007 Budget Schedule for Council review.

B. Review EFD Technology Plan

Discussion was held concerning the Excelsior Fire District Technology Plan and the Fire Board’s desire to have the cities of Deephaven and Shorewood reconsider their veto of the 2008 Capital Equipment Plan in light of the information presented in the Technology Plan.

Councilmember Wheaton and Adams both noted that Councilmember Crockett’s input as Deephaven’s representative to the Fire Board would be valuable and would like to have her comments on the proposed Technology Plan.

Motion by Councilmember Adams to table discussion on the review of the EFD Technology Plan until June 18^th. Seconded by Councilmember Wheaton. Motion carried 4-0.

C. Other

Discussion was held concerning the proposed menu at the June 15^th Cook Out at the Cottagewood General Store that will be sponsored by the City Council.

7. NEW BUSINESS

A. Accept Resignation of Owen Fuglseth

Motion by Councilmember Wheaton to accept the resignation of Owen Fuglseth from the City of Deephaven Public Works Department effective June 29, 2007. Seconded by Councilmember Adams.

Motion carried 4-0.

B. Authorize Hiring a Public Works Employee

Motion by Councilmember Kask authorized hiring a public works employee to replace Owen Fuglseth. Seconded by Councilmember Wheaton. Motion carried 4-0.

C. Other

Councilmember Adams requested the issuance of four parking permits for those Garden Club members who reside outside of Deephaven in order to maintain the garden at Burton Park.

Motion by Councilmember Kask to authorize four temporary parking permits to allow parking from Monday – Thursday until 3:00 p.m. at the parking lot area adjacent to Carson’s Bay launch. Seconded by Councilmember Wheaton. Motion carried 4-0.

8. DEPARTMENT REPORTS

A. Police Department

Police Chief Gustafson stated that he had received an email from a resident about coyotes that had been seen on Linwood Road and Minnetonka Blvd. He stated that he doesn’t doubt that coyotes exist in Deephaven and noted that he has not had a problem with them to date although they can be a risk to small dogs and cats.

He stated that coyotes are not a protected species and a permit could be obtained from the Department of Natural Resources to trap the coyotes. He added that the cost for a trapper to remove the coyotes is typically around $100 per animal.

Councilmember Wheaton asked if it were just a matter of time before a problem developed or can we easily co-exist with the coyotes. Chief Gustafson stated that coyotes do not present a tremendous risk since they are not heavy predators but feed on small rodent and rabbits.

The Council asked the Chief to keep them informed on the situation.

B. Excelsior Fire District

Administrator Young stated that the Fire Board intended to hold a budget meeting in late June that would provide all member city councils to review the proposed 2008 EFD Operating Budget. He stated that he would inform the Council of the date and time once it became available.

C. Public Works

Administrator Young provided an update on recent public work activities in May and upcoming projects in June.

D. Administration

Administrator Young provided an update on the following items:

· Annual financial report sent to the State Auditor

· 2008 City Budget

· LMCD Budget meeting

· Job Description update

· Population & household data

9. ADJOURNMENT

Motion to adjourn by Councilmember Kask, seconded by Councilmember Adams. Motion carried 4-0. The meeting adjourned at 9:33 p.m.

Respectfully submitted,

Dana H. Young

City Administrator