COUNCIL MEETINGS: Audio and Summary - February 8, 2006
(Agenda Packet for this meeting in Word, Acrobat and html)

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[AUDIO 0.7 mb, 3:55 min.]The public hearing on the REET/Sales Tax exchange was called to order in the Sultan Community Center by Mayor Tolson. Councilmembers present: Champeaux, Wiediger, Slawson, Seehuus, Flower, Blair. Absent: Boyd

Staff: Rick Cisar provided information on the Ordinance which will exchange one half percent of our existing sales tax in exchange for collecting an additional .25% of real estate excise tax.
Letters in opposition to the tax were received from David Demarest, Windermere Real Estate; Starla Shaulis, John L Scott Real Estate; Karen Suggs; Daniel M Allem; Wayne Purser, Realtor.

Public Input:

[AUDIO 0.4 mb, 2:26 min.] Deborah Brown: Is a 10 year resident and works for the school district so she understands the financial constraints in Sultan. Doesn't understand why the city is trading a sales tax that is spread over all for a tax that penalizes a few. Makes a good reason to not live in Sultan. Citizens don't know the impact it will have on their greatest asset, their home.

[AUDIO 1.1 mb,6:25 min.] Nathan Gorton: Government Affairs Director for the Snohomish County/Camano Association of Realtors. Presented a packet to the Council addressing the issue of lack of public notice, the shortsighted tax policy and the legislative intent of the additional REET. The information is contradictory and creates confusion on what the ordinance intends. Requested that the council consider the long term implications of the ordinance on real estate sales.

[AUDIO 0.9 mb, 5:04 min.] Jeff Cohen: Asked where the money will go and how will it jeopardize home owners. It is unfair to penalize the people selling their homes in Sultan. Has talked to merchants and citizens and they don't know what is going on with the tax increase. What will happen if the sales of homes go down, will they continue to go backwards. How does the council feel about having to pay the extra money if they sell their homes.

Loretta Storm (Audio included in link above): Has been involved for 6 years with city issues and knows that the city needs to find solutions. They have to sell a home for long term care of their mother and it will be difficult.

[AUDIO 0.9 mb, 5:21 min.] Dave Demarest: Is a realtor and broker and has done many transactions in the area and the impact of $700 is great for a senior citizen or first time home buyer. The city should find a better solution that is shared across the board.

Frank Linth (Audio included in above link): Lives in the area and understands the issues but the city should look for other solutions. Sultan is unique and a lot of people commute to other areas because housing is affordable. The extra cost will be passed on to the buyer and may impact sales.

[AUDIO 0.4 mb, 2:27 min.] Russ Hokinson: Snohomish County/Camano Association of Realtors. Is confused about the actual percentage that city intends to impose. Report indicates taxes would double but if only imposing ¼ %, the revenue needs to be cut in half. Thom Graafstra, City Attorney, advised that the city imposes two ¼ percents to total ½% and is increasing the tax to ¾%.

[AUDIO 0.2 mb, 0:54 min.] Peter Paterno: Poor planning on the council's part should not impact homeowners. Should reconsider as their action will discourage business and home sales.

COUNCIL INPUT:

[AUDIO 0.4 mb, 2:09 min.] Flower: Confirmed that the increase is only ¼ percent.
Blair: Asked if other cities have imposed the additional tax.
Mayor Tolson: Clarkston is the only city using it now and it is critical that the County participate with the return of the sales tax. Rick Cisar advised that notice must be to the Department of Revenue and the City will not be able to impose the tax until July 1, 2006.

On a motion by Councilmember Seehuus, seconded by Councilmember Champeaux, the public hearing was closed.


PUBLIC HEARING: TAX ON CITY-OWNED UTILITIES

[AUDIO 1.1 mb, 6:42 min.] The public hearing on the Utility tax on city owned utilities was called to order in the Sultan Community Center by Mayor Tolson. Councilmembers present: Champeaux, Wiediger, Slawson, Seehuus, Flower, Blair. Absent: Boyd

Staff:
Rick Cisar presented Ordinance 908-06 which has been expanded to impose a monthly utility tax of 6% on water, sewer and garbage service.

Public Comments:

Janet Peterson: Asked why there was city utility tax on her rented water heater from PSE. Staff will research the matter.

Council:

Mayor Tolson: Advised that Sultan is one of the few cities that do not impose utility tax on their own utilities. The City has lost revenues due to the tax initiatives and this will help resolve some of the financial issues.

[AUDIO 0.4 mb, 2:00 min.] Champeaux: Previous mayors and councils have not taken the position that they did not want to raise taxes. They cut down on spending and hope that sales tax and business would increase and that did not happen. The council needs to take additional measures.

[AUDIO 1.0 mb, 5:50 min.] Flower: It is a mark of leadership to do the right thing in hard times and the council must decide where to make cuts and how to get the city out of the problem. Other cities impose a utility tax to raise revenues. The city is short staffed and can not afford any more cuts. Supports the actions to increase revenues and reorganize.

On a motion by Councilmember Champeaux, seconded by Councilmember Seehuus, the public hearing was closed. All ayes.


PUBLIC HEARING: 6% INCREASE ON UTILTY SERVICE FEES [AUDIO 1.1 mb, 6:45 min.]

The public hearing on the Utility Service fees was called to order in the Sultan Community Center by Mayor Tolson. Councilmembers present: Champeaux, Wiediger, Slawson, Seehuus, Flower, Blair.

Staff:
Rick Cisar reviewed Ordinances 910-06, 911-06 and 912-06 which provide for increases in the fees by 6% on top of the base monthly charges.

Public:

• Ray Kistenmacher: The ordinance causes more confusion, is the council imposing a tax that it doesn't have now? Thom Graafstra, City Attorney advised that the purpose is to clarify that the tax is over and upon the current rate.
• Sherie Vixie: The previous plan was working because we were small and is not working now because we have had unplanned growth and she hopes they will consider that in the future.
• Tracy Long: Understands the need to grow and how serious the problem is but there may be long term impacts. Some may look at Skagit County instead of Sultan for cost savings.
  
  On a motion by Councilmember Seehuus, seconded by Councilmember Slawson the public hearing was closed. All ayes.
  

CITY OF SULTAN COUNCIL MEETING - February 8, 2006

[AUDIO 179 kb, 1:00 min.] The regular meeting of the Sultan City Council was called to order in the Sultan Community Center by Mayor Tolson. Councilmembers present: Champeaux, Wiediger, Slawson, Seehuus, Flower, Blair. Absent: Boyd, Student Representative: Karstan Thot

CHANGES/ADDITIONS TO THE AGENDA:
Consent: Excused absence of Councilmember Boyd

Presentations:

• [AUDIO 0.5 mb, 3:00 min.] Recognition of Military Personnel: Mayor Tolson presented Certificates of appreciation to Chief Operations Specialist Andrew Schmidt, Petty Officer 1st Class Larry Kein, Petty Officer 1st Class Eric McCartney, Petty Officer 2nd Class John Clavert, Petty Officer Josh Dunbar and Coastguardsman Jeremiah Jones for their service to the Country.
• [AUDIO 1.6 mb, 9:09 min.] Artrain - City of Skykomish: Christina Yates provided a presentation on the Artrain that will be coming to Skykomish in late April. The train will feature native art and will be open to the public for three days and will be reserved for school groups for two days. There will also be a gallery open in town to show case local artists during the event.

COMMENTS FROM THE PUBLIC [AUDIO 1.2 mb, 7:00 min.]

Loretta Storm (Josie Fallgatter Statement): Read a statement from Josie Fallgatter into the record that expressed concerns over Ordinance 904-06. The ordinance designates the council as the planning commission and the action seems to violate state law.

Russ Hokinson: Presented a copy of page from the Prothman report that was referenced earlier regarding the REET. The report appears to double the amount of the REET anticipated, however, the city is not doubling the tax. The report shows net revenue of 118,530 but if the math is done correctly, the city would lose $14,000. Recommended that city hold action and recheck the math.

Robert Criswell: Commented that the last time the utility fees and hookup fees were raised everyone in city hall got a raise.

COUNCILMEMBERS COMMENTS [AUDIO 0.6 mb, 3:12 min.]

• Blair: Thanked Mr. Hopkins for pointing out the error in the math calculations. Employee raises and the utility taxes are not tied together. People do need living wage so that they will stay here and the council is not proposing anything out of the ordinary.
• Flower: Thanked the military personnel for their service to the country. The Council is not giving raises to city staff.

STAFF REPORTS:

• [AUDIO 0.3 mb, 1:41 min.] Police Department: Chief Walser advised that the City of Snohomish has agreed to purchase the dog and the cage.
• [AUDIO 0.7 mb, 4:04 min.] Public Works: Connie Dunn advised the bids on the Sultan Basin project were open and it appears that Wilder Construction is the apparent low bidder.
• [AUDIO 0.2 mb, 1:18min.] OMMITTED FROM THESE MINUTES: A statement by Donna Murphy, lauding Connie Dunn's and Fred Walser's work sitting on the CDBG committee
• [AUDIO 0.6 mb, 3:33 min.] Finance: Laura Koenig, Clerk/Treasurer presented the 2005 Annual Report and briefly discussed the LID Bond fund.
• [AUDIO 0.3 mb, 1:42 min.] Planning: Rick Cisar, City Planner, requested that the council reschedule the critical area workshop to February 21st at 6:30 PM.

CONSENT AGENDA [AUDIO 79 kb, 0:26 min.]
The following items are incorporated into the consent and approved by a single motion of the Council. On a motion by Councilmember Champeaux, seconded by Councilmember Slawson, the consent agenda was approved as amended. Champeaux - aye, abstained on the minutes; Wiediger - aye; Slawson - aye; Seehuus - aye; Flower - aye; Blair - aye.
1. Minutes of the January 25, 2006 public hearings and Council meeting as on file in the Office of the City Clerk.
2. Vouchers #06-66 through 06-119 in the amounts of $107,834.30 and payroll through January 27, 2006 in the amount of $134,512.99 to be drawn and paid on the proper accounts.
3. Excused absence of Councilmember Boyd from the February 8, 2006 Council meeting.

ACTION ITEMS:

[AUDIO 0.4 mb, 2:04 min.] Ordinance 900-06 Establish Position of Finance Director: On a motion by Councilmember Flower, seconded by Councilmember Champeaux, Ordinance 900-06 establishing the position of Finance Director was adopted. All ayes.

[AUDIO 0.1 mb, 0:50 min.] Ordinance 901-06 Establish the Office of the City Clerk: On a motion by Councilmember Slawson, seconded by Councilmember Flower, Ordinance 901-06 establishing the office City Clerk was adopted. All ayes.

[AUDIO 1.2 mb, 7:02 min.] Ordinance 902-06 City Engineer: Brief discussion was held regarding the engineer reporting to the Community Development Director instead of the Public Works Director. Connie Dunn, Public Works Director advised that she was opposed to the proposal but would support the Council decision.
On a motion by Councilmember Champeaux, seconded by Councilmember Slawson, Ordinance 902-06 was adopted. All ayes, except Councilmember Wiediger who voted nay.

[AUDIO 0.2 mb, 1:13 min.] Ordinance 903-06 Establish Position of City Administrator: On a motion by Councilmember Seehuus, seconded by Councilmember Flower, Ordinance 903-06 establishing the position of City Administrator was adopted. All ayes.

[AUDIO 0.4 mb, 2:20 min.] Ordinance 904-06 Abolishing the Planning Commission and Establishing a Department of Community Development: On a motion by Councilmember, Flower, seconded by Councilmember Champeaux, Ordinance 904-06 was adopted. All ayes, except Councilmember Slawson who voted nay.

[AUDIO 0.2 mb, 1:21 min.] Ordinance 906-06 Council Meeting [day]: On a motion by Councilmember Champeaux, seconded by Councilmember Seehuus, Ordinance 906-06 changing the Council meeting day was adopted. All ayes.

[AUDIO 1.7 mb, 9:47 min.] Ordinance 907-06 Repeal of Sales Tax and Increase REET: Rick Cisar advised that the public hearing was held earlier in the evening on the ordinance that will provide for an increase in the Real Estate Excised Tax and decrease the sales tax. Brief discussion was held regarding the amount of monies the proposal will provide, the need to check the accuracy of the numbers, the need for county participation and to provide for long term solutions. On a motion by Councilmember Flower, seconded by Councilmember Seehuus, Ordinance 907-06 was introduced and pass onto a second reading. All ayes.

[AUDIO 0.2 mb, 1:01 min.] Ordinance 908-06 Utility Tax on Water, Sewer and Garbage Services: On a motion by Councilmember Seehuus, seconded by Councilmember Champeaux, Ordinance 908-06 imposing a 6% utility tax on water, sewer and garbage was introduced and passed on to a second reading. All ayes.

[AUDIO 1.1 mb, 5:59 min.] Ordinance 909-06 Salary Schedule: Brief discussion was held regarding the salary amounts in the ordinance and the need to do further review. On a motion by Councilmember Slawson, seconded by Councilmember Wiediger, Ordinance 909-06 was adopted. . All ayes.

[AUDIO 0.4 mb, 2:13 min. - Audio for all three ordinance in one MP3 file] Ordinance 910-06 Sewer Service Rates: On a motion by Councilmember Champeaux, seconded by Councilmember Seehuus, Ordinance 910-06 was introduced and passed on to a second reading. All ayes. Ordinance 911-06 Water Service Rates: On a motion by Councilmember Blair, seconded by Councilmember Seehuus, Ordinance 911-06 was introduced and passed on to a second reading. All ayes. Ordinance 912-06 Garbage Services Rates: On a motion by Councilmember Blair, seconded by Councilmember Slawson, Ordinance 912-06 was introduced and passed on to a second reading. All ayes.

[AUDIO 0.6 mb, 8:51 min.] SERS Interlocal Agreement: On a motion by Councilmember Seehuus, seconded by Councilmember Flower brought back to the table. All ayes. Laura Koenig, Clerk/Treasurer, reviewed the Interlocal and the change that requires payment upon beneficial use of the system. Brief discussion was held regarding the effectiveness of the 800 MHz system. On a motion by Councilmember Seehuus, seconded by Councilmember Flower, the Mayor was authorized to sign the SERS Interlocal Agreement with Snohomish County for emergency radio service. All ayes, except Councilmember Champeaux who voted nay.

[AUDIO 0.4 mb, 2:18 min.] Ordinance 913-06 Surface Water Management Plan: Connie Dunn, Public Works Director, reviewed the ordinance that provides for adoption of the Surface Water Management Plan. Following adoption of the ordinance, staff will begin the implementation of the utility. On a motion by Councilmember Flower, seconded by Councilmember Blair, Ordinance 913-06 was introduced and passed on to a second reading. All ayes.

[AUDIO 0.6 mb, 3:16 min.] Sultan Basin Road - Contract Amendment: On a motion by Councilmember Champeaux, seconded by Councilmember Seehuus, the Mayor was authorized to sign contract amendment with Snohomish County for the Sultan Basin Road project. All ayes.

[AUDIO 0.3 mb,1:56 min.] Appointment of Interim City Administrator: On a motion by Councilmember Seehuus, seconded by Councilmember Slawson, the Mayor was authorized to sign a contract with the Protham Company for an interim City Administrator. All ayes.

[AUDIO 0.2 mb, 0:51 min.] Appointment of Interim Finance Director: On a motion by Councilmember Flower, seconded by Councilmember Slawson, the Mayor was authorized to sign a contract with the Protham Company for an interim Finance Director. All ayes.

PUBLIC COMMENTS

• Janet Peterson: Noted that it would be helpful to the audience to have information on the agenda items and that she would like to see more backbone on the part of the council
• Ray Kistenmacher: Would not be too glad over a low bid as they often come back with increases.
• Loretta Storm: Advised that information on the agenda is available on the city web site and the GRIT web site.
  

[AUDIO 1.3 mb, 6:00 min.]

• Mary Carson-Ford: Confused about the REET proposal and the five year projection for increases. Appreciates that the council is looking at options but why look to the people who are selling instead of the people who live here.
• Jeff Cohen: Thanked the council for listening to their comments and encouraged them to take a closer look at the REET. Sultan is a first time home buyer market and with problems in the market the extra tax could make a difference.
• Matt Case: Is just getting familiar with processes in the city and was not aware of the proposed taxes until today. Asked if there was a way to inform the home owners about issues that impacts them. Council needs to find a way to get information out to the citizens so they can be educated and be heard.
  
  

COUNCIL COMMENTS (AUDIO in two parts: Part #1, 1.1 mb 6:29 min. & Part #2, 1.0 mb 5:54)

Mayor Tolson: On the REET, the council must come back on annual basis and review the ordinance. They are working with the County for a five year agreement to help the city recover financially.

Slawson: Is newly elected and did not want to raise taxes but prior councils did not take the needed actions.

Flower: Thanked the residents for understanding the need to raise taxes and the need to take a stand on difficult issues.

Blair: Thanked the citizens for their comments. The Council needs to decide what is right for the city and how to best serve the citizens. Agrees that it is difficult to get information out to the citizens.

Champeaux: Thanked the people for coming and noted that there are agendas available at the meeting and the city could put the web site information on the agenda.

Executive Session: On a motion by Councilmember Seehuus, seconded by Councilmember Blair, the Council adjourned to executive session for fifteen minutes to discuss Union Negotiations. All ayes.
Law Enforcement Union Contract: On a motion by Councilmember Seehuus, seconded by Councilmember Wiediger, the Mayor was authorized to sign the Law Enforcement Union Contract as presented. All ayes
Adjournment: On a motion by Councilmember Blair, seconded by Councilmember Champeaux, the meeting adjourned at 9:20 PM.