The City Beat

Quickies: City Beat anniversary

The bridges of Grand Forks County, among the bridges of several other counties in the Red River Valley, were discussed Tuesday at the Grand Forks Civic Auditorium.

The meeting, called the Bridge Summit, brought together local and state officials to provide information to the public about the state of the bridges and plans to improve them.

Earl Haugen of the Metropolitan Planning Organization fielded questions from the audience of about 25....

Wow! Nine years and still boring! Think I'll write about the drying rate of various brands of paint or the how fast the grass is growing (No. Wait. Milo Smith already did that. Hahahaha! Sorry, dude. Someone had to do it.).

Also, I counted 384 ceiling tiles.

C'mon people, let's get involved! I'll round up all my friends in Ward 3 when it's our turn!

Posted by: Tu-Uyen on 11/20/2008 at 8:37 PM | Comments (3) | Permalink

Recount more boring than expected

Update 8:01 p.m. Nov. 20, 2008: Alright, we've got a real recount on in Polk County! County Auditor Gerry Amiot reported that there were "raised voices" and more than a little tension today between Norm Coleman's camp and Al Franken's camp. There was also a challenge to a challenge, two, in fact.

Coleman's people said one ballot that got rejected was for their guy and one ballot that was for Franken should've been rejected. Both ballots were in East Grand Forks' Ward 2. What's up with East Side?

  1. One ballot had what looked like a vote for Coleman and a vote for the Constitution Party's James Niemackl. The way Gerry describes it, it sounds like an over-vote, which invalidates the vote. Coleman's people thinks they can make a case the voter really wanted to vote for Coleman. I didn't see it with my own eyes so this is just what I'm hearing.
  2. The other ballot had a clear vote for Franken except it was a ballot from Crookston's Ward 2, not East Grand Forks' Ward 2. Gerry said his people sent the wrong absentee ballot but that he doesn't think that obscures the voter's intent. Coleman's people say the ballot is invalid anyway.

Franken's attorney, Jeffrey Hannig, said the challenges were invalid because they were made not by Coleman's observers at the counting table, as is required, but by Coleman's roving observer, Tyler Glick.

Tyler is basically the top guy from Coleman's campaign at the recount. He's actually part of the campaign staff and, essentially, the other observers work under him, the way I understand it. In that supervisory role, he doesn't sit at the recount table but watches over other observers' shoulders. Does that make his objection count as much as that of someone at the table? They both speak for the same guy, right?

The City Beat was stuck most of the day yesterday in Crookston covering the Minnesota Senate race recount. I can tell you now that there are 182 ceiling tiles and 12 light installations in Court Room 2 at the Polk County government building. Also, the wooden barrier dividing observers from the rest of the court needs a refinish.

This was the soundtrack of my day: "Coleman. Coleman. Coleman. Franken. Coleman. Franken. Franken. Franken. Barkley. Franken. Franken. Coleman. Barkley. Barkley. Coleman. Franken. Coleman. Coleman. Franken. Franken...."

I have renewed respect for election judges and campaign workers and also County Auditor Gerry Amiot, who's been super helpful even when missing lunch.

(By the way, check for whatever recount results have been posted here.)

Of course, after I left, that's when three challenges popped up, two in East Grand Forks and one in Eden Township in the eastern end of the county.

  1. The Franken camp objected to a ballot in Eden because the voter looked like he'd voted for Dean Barkley (Independence), whited it out and made a mark for Coleman. I didn't see it but Gerry described it to me on the phone that way. He wouldn't give an opinion but it sounds like he doesn't think Franken's got a strong case on this one.
  2. The Coleman camp objected to a ballot in East Side's Ward 1. The marks were already kind of light but they were even lighter for Franken, which the Coleman camp thinks means the voter changed his or her mind and tried to erase his or her vote.
  3. The Franken camp objected to another East Side Ward 1 ballot. The voter voted for Coleman and then, inexplicably, made a line on Charles Aldrich (Libertarian). He or she had done the same for the presidential race.

Anyway, this stuff is tame compared to what one of the Franken guys saw in Anoka, Minn. On one ballot, the voter had written "Clition" for president and then scribbled obscenities on everybody else's names with curlicues that stretched from one candidate to another.

Sheesh. Not to be undemocratic but if you don't know how to vote right, how qualified are you to vote?

Posted by: Tu-Uyen on 11/20/2008 at 12:59 PM | Comments (1) | Permalink

Property taxes going up a bit in EGF

I'm afraid with all the stuff happening earlier in the week in Grand Forks that I've been neglecting East Side. The City Council approved a budget and tax levy tonight and, while I've been out of the loop, the council managed to keep the levy from getting out of hand.

City Administrator Scott Huizenga said property taxes will go up only about 0.8 percent.

A few months ago, the city was looking at a $300,000 deficit even with a 4.7 percent property tax increase, the max allowed by the state.

Scott said the city's cutting a job in inspections through attrition, combining inspections with planning and moving the cost of housing rebates from the general fund, which gets its money from property taxes, to the lot sale fund.

There are other changes with water and light but I didn't have the time to go through the numbers last night. I told Scott I'd look at them later this week. The property taxes is what most readers would care about.

I'd also check to see if the city deferred any maintenance it was going to do next year. The police station had some serious moisture issues the last I checked.

Nevertheless, a 0.8 percent increase is pretty good considering inflation among small Midwest cities in September was 5.1 percent October was 3.6 percent.

Posted by: Tu-Uyen on 11/19/2008 at 2:03 AM | Comments (10) | Permalink

Solid "no" to Alerus Center sales tax diversion

A while ago, Grand Forks City Council member Terry Bjerke asked if the city could divert some of the Alerus Center sales tax to property taxes. The anwer came in today: No, no and -- stop, don't bother asking -- no.

That's from Brenda Krueger of Springsted Inc., whom I spoke with yesterday, and City Attorney Howard Swanson.

They said there are two obstacles city leaders would have to overcome to divert any of the money:

  1. Bond convenant: This is a set of legal promises to investors who bought the Alerus Center bonds back in 1997 and when the bond was essentially refinanced in 2005. The city won't be able to change the covenants unless they refinanced again or paid off the entire bond.
  2. Home rule charter: The original events center ballot measure from 1996 modified the home rule charter to create the 3/4-percent sales tax and stipulate that it goes only to an events center. Voters could modify the charter again but only if the bond covenants changed.

The covenant has the following conditions:

Why so restrictive? Brenda said that's how the city got the low interest rate that it got. Our archives show that it was 5.73 percent in 1997. The rating for the bond was A1, which probably isn't that bad given that sales tax revenue is highly volatile.

The bond actually got an Aaa rating because it's insured by MBIA, which has an Aaa rating. Brenda said on Tuesday that, because of the subprime mortgate crisis, MBIA's rating's gone down to Baa1 so if the city refinanced, it'd have to depend on its own bond rating.

I think the city got about 4.6 percent in the 2005 refinancing. The archives are incomplete on this one and I didn't think to ask anyone at today's meeting. Given that the city recently sold bonds rated at Aaa3 at 4.53 percent, I don't suppose an A1 will get as good an interest rate.

What does the bond covenant mean for city leaders?

It means they can't divert the money for property tax relief. They can't use it to build, as some suggested, a new library or wellness center, at the Alerus Center. They can't use it to buy land, as some other suggested, unless that land is developed for a use directly related to an events center.

I didn't stop to ask why the city would buy land but it made me think of the theory regarding the Amazon.com land. The theory goes that the city had all this CDBG money sitting around after the flood. If the city didn't spend it, the feds would take it back. So, even though the city didn't have a solid deal for Amazon.com to build a distribution center, the purchase of the land kept the money in the city. The person who suggested the city buy land specifically said: What happens if the city bought land but didn't build a parking lot on it? This suggests an investment for future resell.

So now, there's the thought that the city could use the sales tax surplus to build an endowment that would pay for Alerus Center upgrades in perpetuity. If the $4.7 million the Alerus Center folks want to spend next year as part of an eight-year upgrade cycle is normal, that would mean the endowment would have to yield $600,000 a year. If we assume a 5 percent a year yield, that'd be a $12 million endowment, I think (This is pure speculation and I'm sure I'm revealing the depth of my ignorance. Anyone smarter is welcome to insert a different number.).

Chances are, any endowment would yield in excess of 5 percent on the stock market. But, given the ups and downs of the market, I'm assuming anything above the 5 percent would be reinvested or set aside. I'm just basing my SWAG on something I read on Wikipedia's entry on endowments.

Posted by: Tu-Uyen on 11/18/2008 at 8:56 PM | Comments (5) | Permalink

A few tidbits from tonight's meeting

Here's a few interesting pieces of info the City Beat picked up at tonight's Grand Forks City Council meeting.

Posted by: Tu-Uyen on 11/17/2008 at 9:29 PM | Comments (1) | Permalink

Bond raters: GF's doing pretty good

Brenda Krueger from Springsted, the city's financial consultant, told the Grand Forks City Council tonight that the city should be pleased with where it's sitting economically. As I wrote in my story, the city got a 4.47 percent interest rate on a recent bond issue and had its credit rating of Aa3 reaffirmed.

Aa3 is pretty sweet (I'd link to Moody's but you have to log in) and, in an economy like this one, it means the city is an island of stability for investors looking for safe investments.

Brenda said that many of the cities that she advises are not doing as well as Grand Forks, which still has a pretty strong economy and is seeing new construction.

Construction is important because property taxes or special assessments is what guarantees many of the city's bonds. The Aa3 rating is based partly on the amount and value of properties the city could tax.

I checked to see if Brenda was just making us feel good and found a very recent story on Minnesota Public Radio:

Not every project was getting underway. A municipal bond market showing signs of trouble all year looked like it was drying up altogether by October. According to the financial information service Bloomberg, total bond sales in Minnesota this far into the year, are at the lowest levels since 2003.

Most projects could still get funded, according to Mark Ruff with the Roseville financial advisory firm Ehlers and Associates, but not for cheap.

I did an archive search to see what Brenda said the other times she was here. In June 2007, she went before the City Council to talk about the city's failure to get a credit rating upgrade to Aa2. Moody's Investors Service, which issues the ratings, had toured the city and came away impressed but not enough for an upgrade:

First, the value of the city's properties, which is the basis for its taxing power, is not as high as communities that have Aa2 ratings. Still, the city is going in the right direction because property values are on the rise, which, incidentally, has made many homeowners nervous about their tax statements.

Second, the city's debt load is still quite high, much of it from debt on the dikes. Those debts, however, are expected to be paid off as early as 2014.

By the way, the winning bid for the city's $3.46 million bond came in at 4.47 percent. That's interest cost of $1.44 million. Robert W. Baird & Co out of Wisconsin got that one. The highest interest rate was 4.74 percent from UBS Securities. The city's supposed to pay off in 2028.

Actually the rate structure is pretty weird. For those interested, here's how the interest payment would work out with Baird:

2009-2016: 4%
2017-2019: 4.25%
2020: 4.375%
2021: 4.5%
2022: 4.625%
2023-2028: 5%

It all works out to 4.4742 percent in the end. I say "weird" because I haven't been paying attention to how these things are structured. I think they're called "stepped coupon bonds," "coupon" being the term for interest rate and "stepped" as in a "stepped schedule." Wished I'd taken some finance classes in college.

Posted by: Tu-Uyen on 11/17/2008 at 8:41 PM | Comments (2) | Permalink

Forum in Ward 1

Grand Forks City Council member Terry Bjerke is holding a forum with his constituents this Thursday. (Here's a map of Terry's ward.)

I'm curious what will come out of this other than a chance for people to just talk about the issues.

The last time a council member held a forum, if I remember right, was May 2007 when Council member Mike McNamara held a meeting on property taxes. Here's what I wrote at the time:

... He held a property tax forum Tuesday in Valley Middle School to hear some more because, he said, "it's important for elected officials to talk to people so you don't let issues get away from you."

Toward the end of the meeting he put out a call to action: "Talk will get you only so far. You gotta go to the meetings and flex your muscle." ... 

Some of McNamara's colleagues were present as well, along with city department heads and some state legislators. That concerned taxpayers only slightly outnumbered the government officials seemed to reinforce McNamara's point about the importance of getting involved.

Perhaps more people are watching Council TV and calling their council members, but I'm not sure I've seen more involvement, though for not lack of trying on Mac's part. The property tax issue, in fact, has shifted from the local level to the state level with state lawmakers promising to deliver K-12 funding reform and cutting school taxes.

The agenda for Terry's meeting include (Updated 8:36 p.m. Nov. 17, 2008: Updates are underlined):

Hopefully, attendance at this forum will be strong.

Posted by: Tu-Uyen on 11/17/2008 at 4:24 PM | Comments (1) | Permalink

It's like a big city, but not

Joe Bergeson, a folk musician from Fertile, Minn., was busking at the Riverwalk Centre in East Side the other day. Check out this vid:

I didn't know there was a word for this. We always called them street musicians back home in Seattle. I don't remember ever having seen a busker downtown before so maybe this is a first. If there were more like Joe, downtown would feel even more like a downtown.

Joe asked me the other day if it was OK for him to play and sell his CDs at the Riverwalk because of the great acoustics. I said it's public property so he's probably OK.

Now that I think about it, he probably needs an itinerant merchant's license or something but maybe the city will ignore this sort of thing in favor of having a vibrant street scene. It works fine in Seattle! Joe played and reported no problems.

Posted by: Tu-Uyen on 11/14/2008 at 10:49 PM | Comments (11) | Permalink

Busy weekends in the Grand Cities

It looks like the next few weekends will be pretty busy here in the Grand Cities with high school and UND sports this weekend and Thanksgiving holidays the weekend after next.

The City Beat was going to do a story about hotels being filled until Julie Rygg from the Convention and Visitors Bureau told me it's not that unusual. Hotels are filled a lot of weekends, she said. It's the weekdays we gotta worry about, she said.

In the winter and spring, we've got lots of conventions and sports events, she said, and in the summer we've got tourists. I forget what she said about fall (I wasn't going to write a story, right?).

You'll find the chart above at the CVB Web site. Red means no rooms and yellow means some rooms. It's a neat economic gauge that's easy to understand. Notice that it applies only to weekends. We can assume, as Julie said, that there's plenty of vacancies in the middle of the week.

A good indicator that Canadian traffic has not tapered off because of currency fluctuations is the occupancy rate. The year to date for CVB members through September is 66.7 percent. The same period a year ago, it was 67 percent. Thanks to Julie for those numbers.

Posted by: Tu-Uyen on 11/14/2008 at 2:37 PM | Comments (1) | Permalink