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HomeMy WebLinkAboutMinutes - 03/20/2017 - City CouncilREGULAR MEETING March 20, 2017 Mayor Low called the regularly scheduled March 20, 2017 meeting of the McHenry City Council to order at 7:00 p.m. In attendance were the following Aldermen: Santi, Glab, Schaefer, Curry, Wimmer, Peterson and Condon. Absent: None. Also in attendance: City Administrator Morefield, Deputy City Administrator Hobson, Director of Economic Development Martin, Chief A Police Jones, Director of Community Development Polerecky, Director of Finance Lynch, City Attorney McArdle and City Clerk Jones. The meeting was called to order by Acting Mayor Augie Arnold, a student at Riverwood School. PLEDGE OF ALLEGIANCE LED BY RIVERWOOD SCHOOL STUDENT: ACTING MAYOR AUGIE ARNOLD Acting Mayor Arnold led Council and those in attendance in the Pledge of Allegiance. OATH OF OFFICE: PATRICK DEVINE WARD 6 ALDERMAN City Clerk Dalton administered the Oath of Office to newly appointed Ward 6 Alderman Patrick Devine, PRESENTATION: MAYORAL PROCLAMATION IN RECOGNITION OF FLYING DRAGONS MARTIAL ARTS ACADEMY 35T" ANNIVERSARY Master Wayne Steinmetz accepted the Mayoral Proclamation in recognition of McHenry Flying Dragons 35th anniversary and proclaiming March 21, 2017, as McHenry Flying Dragons Day, CITY OF MCHENRY MISSION STATEMENT Mayor Low read aloud the Mission Statement of the City of McHenry. PUBLIC INPUT SESSION Mayor Low noted that all the persons who signed in to speak at Public Input Session about Agenda Item No. 10 would be given the opportunity prior to a vote being taken. CONSENT AGENDA A. Resolution authorizing annual update of City Zoning Map; B. Ordinance authorizing the Mayor's execution of an Intergovernmental Agreement with McHenry Township Fire Protection District for the Operation of a Wireless Alarm Program; C. Proposal from Trane Chicago Service for replacement and installation of Variable Air Volume Box Controllers throughout the Municipal Center, in the amount of $55,340, through the US Communities cooperation purchasing entity; D. Special Use and Temporary Sign Permits and waiver of associated fees for annual Back to Family Outdoor Movie Night in Veterans Memorial Park, on Fridays, September 8, 15, 22 and 29, 2017, from 4:00 pm to approximately 9:00 pm; E. Special Use and Temporary Sign Permits and waiver of associated fees for annual Green Street Cruise Night on Monday evenings, May 22 through September 25, 2017, from 6:00 pm to 8:30 pm; F. Request for a Special Event Liquor License from The Church of Holy Apostles for the Catholic Assistance Mission Help & Hope for Haiti Fundraiser; Regular Meeting Page 2 March 20, 2017 G. Requests for Park Facilities Special Use/Picnic Permits; H. Approval of Issuance of As Needed Checks, in the amount of $70,906.48; and I. Approval of Payment of Bills, in the amount of $1,008,792.90. Motion by Wimmer, second by Schaefer, approving Consent Agenda, as presented: Voting Aye: Santi, Glab, Curry, Schaefer, Wimmer, Devine, Condon. Voting Nay: None. Absent: None. Motion carried. MOTION TO CONSIDER A REQUEST FOR A REVOLVING LOAN SUBMITTED BY JIMMYBREAD LLC D/B/A JIMMYBREAD & BREW, 3425 PEARL STREET, IN THE AMOUNT OF $55,000, SUBJECT TO CONDITIONS AS RECOMMENDED BY FIRST NATIONAL BANK OF MCHENRY Director of Economic Development Martin reported a Revolving Loan Fund application was submitted for Jimmybread and Brew. James Bellavia and his partner are seeking $55,000 for working capital and intend to use the funds, as well as investor dollars, to build their business at 3425 Pearl Street. Director Martin noted the business has a well established customer base, but is currently without a permanent address. James Bellavia, is dedicated to the City of McHenry and works long hours baking, marketing and selling his products. Jimmy has long been affiliated with the McHenry's Farmers Market and participates in PTO events at the different schools in the area without a permanent address. Jimmybread and Brew is proposing to open in a building originally construct in the 19th Century as a brewery. Staff. has been working with Bill Busse of First National Bank of McHenry, which conducted underwriting services for the proposed loan application. Staff reviewed with the Council, Mr. Busse's analysis of the loan application that included the bank's concerns about the high mortality rate for new restaurants; no historical financial information to analyze, little margin for error in the business revenue/expense projects; and the group's total reliance on outside funding. Mr. Busse suggested if the City of McHenry enters into a loan agreement with Jimmybread and Brew, the following should be considered: • Securing the loan with the first lien purchase money security interest in the business assets purchased (fixtures and equipment); • No disbursement of City loan funds unless and until all investor group seed funding in the amount of $145,000, has been validated and deposited as start-up funding for the enterprise; • An unlimited and unconditional personal guarantee from James Bellavia and Christy Steinmeier; • Personal and business financial statement submitted annually; • The loan be repayable monthly over a five year term at 3,75% fixed rate of interest with no prepayment penalty; and Regular Meeting Page 3 March 20, 2017 • The City would buy back the loan (after reassignment by First National) if the loan payments become delinquent for more than sixty (60) days. Director Martin informed the Council this request was presented to the Finance & Personnel/Revolving Loan Committee on March 6, 2017. The Committee opined that Jimmybread and Brew would be a great enhancement to the downtown area with a "farm to table" restaurant. Following discussion, the Revolving Loan Committee unanimously recommended the loan application be submitted to full Council for consideration, subject to the following conditions: • The loan be secured with first lien purchase money security interest in the business assets purchased (fixtures and equipment), in the amount of $150,000 to $200,000; • No disbursement of City loan funds would occur until all investor group seed funding, in the amount of $145,000, had been validated and deposited as start- up funding for the enterprise; • An unlimited and unconditional personal guarantee from James Bellavia and Christy Steinmeier; • The loan be repayable money over a five-year term at a 3.75% fixed rate of interest with no prepayment penalty; and • The City of McHenry would buy back the loan (after reassignment by First National) if loan payments become delinquent for more than 60 days. Alderman Condon opined that she likes "farm to table" concept and that the proposed establishment has the potential to become a real asset to the community. Responding to Alderman Santi's inquiry regarding the garden, Mr. Bellavia informed Council that the concrete and asphalt would be removed in a portion of the beer garden area next year and a small garden would be installed. Mr. Bellavia noted that one of the investors in the venture is an employee of the McHenry Conservation District and the goal is to find out Oat sells and then what will be grown. Alderman Santi inquired about the amount that is currently in the Revolving Loan Fund. Director of Finance Lynch informed Council there is currently approximately $72,000 in the Revolving Loan Fund. Responding to Alderman Schaefer's concerns regarding the back lot being eliminated, Mr. Bellavia stated that only a portion of the back lot is being considered for removal. The beer garden would still exist with a garden of adequate size. Responding to Alderman Schaefer's inquiry regarding the ramifications should the loan fail, Director Martin explained. Alderman Curry opined that he likes the concept but is concerned with the financing and Mr. Busse's assessment from a financial standpoint. Alderman Curry stated that due to his Regular Meeting Page 4 March 20, 2017 financial concerns regarding the business he is unable to support the proposed loan. Alderman Glab concurred with Alderman Curry. Alderman Wlmmer stated he has no concerns with the loan and opined that the Revolving Loan Fund exists to support start up businesses within the community. Motion by Condon, second by Wimmer, approving the application submitted by Jimmybread and Brew for a Revolving Loan, in the amount of $55,000, subject to the following conditions: • The loan be secured with first lien purchase money security interest in the business assets purchased (fixtures and equipment); in the amount of $150,000 to $200,000; • No disbursement of City loan funds would occur until all investor group seed funding, in the amount of $145,000, had been validated and deposited as start- up funding for the enterprise; • An unlimited and unconditional personal guarantee from James Bellavia and Christy Steinmeier; • The loan be repayable money over a five-year term at a 3.75% fixed rate of interest with no prepayment penalty; and • The City of McHenry would buy back the loan (after reassignment by First National) if loan payments become delinquent for more than 60 days. Voting Aye: Schaefer, Wimmer, Peterson, Condon. Voting Nay: Santi, Glab, Curry. Absent: None. Motion carried. MOTION TO APPROVE A CONTRACT WITH MELROSE PYROTECHNICS TO PRODUCE._ A 25- MINUTE FIREWORKS DISPLAY ON DULY 10 2017 (RAIN DATE: JULY 22 2017) IN CONJUNCTION WITH THE ANNUAL JAYCEES DAY 4T" OF JULY FIREWORKS CELEBRATION IN PETERSEN PARK, FOR A TOTAL COST OF $15,000, WITH A $10,000 CONTRIBUTION FROM THE JAYCEES AND $5,000 FROM THE CITY OF MCHENRY Mayor Low stated that following a motion from Council, a discussion regarding this item would follow. Motion by Schaefer, second by Curry, approving the contract with Melrose Pyrotechnics to produce a 25-minute fireworks display on July 1, 2017, with a rain date of July 2, 2017, in conjunction with the annual Jaycees Day 4th of July fireworks celebration in Petersen Park, for a total cost of $15,000, with a $10,000 contribution from the Jaycees and $5,000 from the City of McHenry, as presented. Regular Meeting Page 5 March 20, 2017 Mr. Andrew James, owner of Mad Bomber Fireworks, and Mr. Dan Miller, Vice President of Mad Bomber Fireworks addressed Council. Mr. James explained to Council that Mad Bomber never received the Request for Proposal (RFP) sent out by the City of McHenry. Mr. James stated that the City appeared to be pleased with Mad Bomber's performance last year and Mad Bomber was looking forward to again working with the City of McHenry and the Jaycees on the 4th of July fireworks display in 2017. Mr. James stated that while it might be futile, he felt compelled to speak as it is important to him personally to inform Staff at the City of McHenry and the Council that not presenting the RFP was not a deliberate omission. Assistant City Administrator Hobson informed Council that five (5) proposals were mailed out via first class mail, as is normal practice, together with a legal notice published in the Northwest Herald. Only one proposal was returned and that proposal was received from Melrose Pyrotechnic. Mr. Hobson stated that he telephoned Mad Bomber inquiring why they had not submitted a proposal because the City had been pleased with the show provided in July 2016. At that time, Mr. Hobson was informed that no RFP had been received. Responding to Alderman Schaefer's inquiry regarding legal authority, City Attorney McArdle stated that the RFP is an application regarding qualifications it is not a bid. There is no law that states the Council is required to accept an RFP. The Council has the authority to accept, or not. Alderman Curry asked whether the RFP was ever received by Mad Bomber. Mr. James informed Council that the RFP was never received. Alderman Curry suggested in the future that RFP be sent out via certified mail, return receipt requested. Assistant City Administrator Hobson reiterated that it not standard practice. Alderman Condon inquired about what procedure would have to be followed should Council want to reject the sole RFP received by Melrose Pyrotechnic and consider Mad Bomber. City Attorney McArdle informed Council that the motion to approved a contract with Melrose Pyrotechnics would have to be rejected and a motion would have to be made directing Staff to re -issue the RFP. Alderman Condon opined that she is curious to see what Mad Bomber has to offer. Alderman Glab stated that he had no complaints regarding Mad Bomber's presentation last year. Alderman Glab opined he is uncomfortable awarding a contract when only one proposal was received. Alderman Glab expressed his support to reject the motion. A discussion ensued. Motion to approve the contract with Melrose Pyrotechnics to produce a 25-minute fireworks display on July 1, 2017, with a rain date of July 2, 2017, in conjunction with the annual Jaycees Day 4th of July fireworks celebration in Petersen Park, for a total cost of $15,000, with a $10,000 contribution from the Jaycees and $5,000 from the City of McHenry was withdrawn for lack of a vote, following discussion. Regular Meeting Page 6 March 20, 2017 Motion by Schaefer, second by Curry, directing Staff to return to the next Council meeting with two proposals comparing Mad Bomber and Melrose Pyrotechnics. Voting Aye: Santi, Glab, Curry, Schaefer, Wimmer, Devine, Condon. Voting Nay: None. Absent: None. Motion carried. MAYOR'S STATEMENT AND REPORT Mayor Low had no statement or report. COMMITTEE REPORTS Alderman Condon informed the Council that a meeting of the Community Development Committee is scheduled on Monday, March 27, 2017 at 7:00 pm in the Council Chambers. Alderman Wimmer informed Council that a Finance and Personnel Committee meeting is scheduled on Wednesday, March 22, 2017 at 5:30 pm. STAFF REPORTS There were no Staff Reports. FUTURE AGENDA ITEMS Alderman Santi requested that Staff check Lacey's Place on Front Street to be sure they are actually a Sushi bar. ADJOURNMENT Motion by Wimmer, second by Condon, to adjourn the meeting at 8:12 pm. Voting Aye: Santi, Glab, Schaefer, Curry, Wimmer, Peterson, Condon. Voting Nay: None. Absent: None. Motion carried. The meeting was adjourned at 8:12 pm. Mayor City Clerk