Regular Meeting

January 16, 2007

The Mayor and Council of the City of Fairbury met in regular session in the Council Chambers, 612 D Street, Fairbury, Nebraska, on the 16^th day of January, 2007, at 7:30 p.m.  Mayor E.M. Mueller called the meeting to order.

Notice of meeting was given in advance thereof by publication in the Fairbury Journal News, Fairbury, Nebraska, the designated method of giving notice, as shown by affidavit of publication.  The Open Meetings Act is posted in the Council Chambers as required by law.

Roll call found the following Council Members present:  Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson.  Absent:  Bender.

Mayor Mueller read the Consent Agenda.  (1) Approval of the minutes of the regular meeting of January 2, 2007.  (2)  Approval of the minutes of the Community Redevelopment Authority meeting of January 2, 2007.  (3) Approval of the minutes of the special meeting of January 9, 2007.  (4) Approval of claims.  (5) Approval of the December 2006 Reconciliation Report.  Byrd made a motion to approve the Consent Agenda.  Motion seconded by Phillips.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

Nelson made a motion to set the public hearing concerning a proposed Redevelopment Plan and Redevelopment Contract with Red Oak Properties, LLC, for Tax Increment Financing in the area legally described as Lot 1, Block 3, Fairbury Industrial Park, an addition to the City of Fairbury, Jefferson County, Nebraska, for February 6, 2007 at 7:30 p.m.  Motion seconded by Byrd.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

Trimm made a motion to set the public hearing concerning the semi-annual Local Option Sales Tax (LB840) Program review for February 6, 2007 at 7:30 p.m.  Motion seconded by Byrd.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

Brian Blobaum of Blobaum & Busboom P.C. presented the Annual Audit Report for Fiscal Year 2006.  Blobaum stated that as a result of the audit performed by his firm, he is issuing a clean opinion and believes that records are free from material mistakes.  Blobaum listed items that warrant reporting to the council which included a suggestion for separation of duties, LB840 compliance regarding the existence of outstanding LB840 loans, and the need for greater grant oversite.  Blobaum also advised that all accounts in existence need to be reported on City books and be subject to the same requirements as all other City accounts.  Blobaum reported a net cash reduction of $244,455 for 2006 and an increase in long-term debt from $1,310,000 to $2,180,000.  Blobaum stated the major City expense is personal services which account for over 60% of the City’s total budget.  Blobaum concluded by stating the City is running extremely short on cash reserves.

Phillips made a motion to approve the reappointment of Wayne Schultis to the Board of Public Works, term to expire January 2011.  Motion seconded by Byrd.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

Vickie Kroll, owner of Griffey’s Steakhouse & Lounge, requested the City approve her business as a Keno Sales Outlet.  Polson stated the Finance and Keno Committee recommends approval of the request.  Polson made a motion to approve Griffey’s as a Keno Sales Outlet.  Motion seconded by Fry.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

The Council considered a request from Reverend Charles Schmidt for permission to form a committee to develop future trails projects.  City Attorney Tim Noerrlinger advised a resolution would need to be adopted establishing such committee.  Trimm made a motion to direct the City Attorney to draft a resolution creating a special committee to develop future trails projects.  Motion seconded by Byrd.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

An agreement with Lambriar Animal Health Care (LAHC) for transfer of property option was presented to the Council for consideration.  Ferneau stated he had received a list from the Department of Economic Development (DED) of  items needed for CDBG application review and that this agreement was one of those items.  Ferneau informed the Council that this agreement transfers the option to purchase the Riensche property from LAHC to the City.  Trimm made a motion to approve the agreement.  Motion seconded by Phillips.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

A Memorandum of Understanding (MOU) with Fairbury Steaks for a grant of $300,000 of LB840 funds was presented for consideration.  Noerrlinger stated this MOU was developed by the joint efforts of Fairbury Steaks and the special negotiating committee.  Polson stated that in this version of the agreement, the working line of credit was reduced from $600,000 to $100,000 and that he would like to see a larger credit line required. Polson also stated the committee was told they could have second position on equipment and inventory, but that they do not know what equipment or how much of what inventory.  Polson stated the committee was told by Fairbury Steaks that equipment they possess was on a lease to own basis; Polson stated he didn’t feel there is any collateral on equipment that is part of a lease agreement.  Polson explained that the City has no financials and doesn’t know what Mr. Brown owns or what his equipment is really worth.  Polson made a motion to send the MOU back to a negotiating committee for further negotiation with Mr. Brown, with said committee consisting of all council members.  Motion seconded by Phillips.  Dennis Brown addressed the Council and stated he feels he had done all that was asked of him by the committee.  Dennis Brown stated he wanted a confidentiality agreement signed and that only the grant administrator needs to see his business’ financial information.  Polson stated the Council has to answer to the public on how these funds are used.  Trimm stated he did not understand collateralizing the agreement with second position on assets and said he would like to know what percentage of Fairbury Steaks’ assets are unencumbered.  Nelson stated he understands the concern for confidentiality, but that to a certain extent, records need to be public when public funds are involved.  Discussion ceased.  On roll call, Brown, Phillips, Trimm, Fry, and Polson voted “yes.”  Byrd voted “no.”  Nelson abstained.  Bender absent.  Motion carried.

Fry made a motion to appoint Jim Ferneau grant administrator of the LB840 grant to Fairbury Steaks.  Motion seconded by Byrd.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.

Ferneau provided handouts to the Council on the goal setting session held January 9, 2007.  Ferneau asked Council members to review notes from the Council goal setting session and come prepared to work on defining goals at the February 6, 2007 meeting.  Ferneau encouraged Council members to attend the League Midwinter Conference.  Ferneau announced an emergency management meeting is February 6, 2007 in Beatrice.  Brown reported a Public Safety Committee meeting will be held January 22, 2007 at 7:00 in the Council Chambers.

Byrd made a motion to adjourn the meeting.  Motion seconded by Trimm.  On roll call, Brown, Phillips, Byrd, Trimm, Nelson, Fry, and Polson voted “yes.”  Bender absent.  Motion carried.  Meeting adjourned at 8:38 p.m.

                                                                                              E. M. Mueller, Mayor

ATTEST:

     Tami Arnold, City Clerk