Planning Director Ben Rangel reported that Resolution 9502 annexes 1.152 acres of land to be combined with Lot 3A, Block 1, Fox Farm Addition 2. Ordinance 2921 assigns a zoning classification of "A" Residence Use, "A" Area District. The Annexation Agreement contains terms and conditions associated with annexation.

On May 24, 2005, the Planning Board conducted a public hearing and at its conclusion passed a motion recommending the City Commission approve the annexation and apply the proposed zoning classification. The annexation agreement contains terms subject to the following conditions: paying all fees and entering into the agreement.

Mayor Gray declared the public hearing open. No one appeared to speak in support of or opposition to Resolution 9502 or Ordinance 2921. Mayor Gray declared the public hearing closed.

Commissioner Beecher moved, seconded by Commissioners Jovick-Kuntz and Rosenbaum, that the City Commission adopt Resolution 9502 and approve the annexation agreement.

Motion carried 4-0.

Commissioner Rosenbaum moved, seconded by Commissioners Beecher and Jovick-Kuntz, that the City Commission adopt Ordinance 2921.

Motion carried 4-0.

City Attorney Dave Gliko stated that Ordinance 2900 was adopted as an interim ordinance on February 1, 2005, for a period of six months, which will expire August 1, 2005, unless extended by the City Commission for up to one year.

The regulations in Ordinance 2900 are meant as interim regulations governing gambling establishments and casinos. The interim ordinance specifies zoning districts allowable for gambling/casino establishments during the interim period and establishes required distances casinos are to be from schools and places of worship. Casinos that are expanded, remodeled or relocated would need approval of the Design Review Board and need to comply with current codes for signage, landscaping and parking.

Mayor Gray declared the public hearing open. Speaking in favor of Ordinance 2900 was Loran Keller, 25 Comanche Trail, who stated that he was speaking on behalf of himself and the CasiNo group and urged the Commission to extend Ordinance 2900.

There being no one further to speak in support of or opposition to Ordinance 2900, Mayor Gray declared the public hearing closed.

Commissioner Rosenbaum moved, seconded by Commissioners Beecher and Jovick-Kuntz, that the City Commission extend Interim Ordinance 2900 for one year.

Motion carried 4-0.

Community Development Director Mike Rattray reported that as prescribed by OCCGF 8.49, a "Notice of Hearing" before the City Commission was posted on the property July 8, 2005, and published in the Great Falls Tribune on July 9, 2005. He added that Resolution 9504 would enable Community Development staff to hire a contractor and abate the ongoing nuisance at 1410 3 Avenue Southwest.

Mayor Gray declared the public hearing open. There being no one to speak in support of or opposition to Resolution 9504, Mayor Gray declared the public hearing closed.

Commissioner Jovick-Kuntz moved, seconded by Commissioners Beecher and Rosenbaum, that the City Commission adopt Resolution 9504.

Motion carried 4-0.

Community Development Director Mike Rattray reported that as prescribed by OCCGF 8.49, a "Notice of Hearing" before the City Commission was posted on the property July 8, 2005, and published in the Great Falls Tribune on July 9, 2005. He added that Resolution 9480 would enable Community Development staff to hire a contractor and abate the ongoing nuisance at 309 1 Avenue Southwest.

Mayor Gray declared the public hearing open. There being no one to speak in support of or opposition to Resolution 9480, Mayor Gray declared the public hearing closed.

Commissioner Rosenbaum moved, seconded by Commissioner Jovick-Kuntz, that the City Commission adopt Resolution 9480.

Motion carried 4-0.

In accordance with state statutes the City Commission has:

1. completed its preliminary budget for the upcoming fiscal year;
2. placed the budget on file, open to public inspection;
3. published notices of preliminary budget hearing;
4. opened the public hearing on July 5, 2005; and,
5. continued the hearing to July 19, 2005.

State statute requires the budget to be approved at a regularly scheduled Commission meeting on or before the second Monday in August or within 45 calendar days of receiving certified taxable values from the department of revenue.

All budgets are closely administered to assure the City will not deficit spend. The City conducts mid-year budget reviews to determine budget adjustments which may be needed. Careful administration and budget flexibility along with mid-year adjustment potential provide the necessary assurances that the City will avoid operational or service cuts.

Mayor Gray declared the public hearing open. Speaking against Resolution 9495 were:

Duane Mellinger, electrician, 1112 7th Street South, who stated that he represented three displaced employees from the City. He added that the budget could be adjusted to allow the displaced employees, who have been with the City for several years, to continue their jobs.

City Manager John Lawton replied that the elimination of the positions Mr. Mellinger referred to had more to do with not having enough work available than with the budget under consideration.

John Hubbard, 615 7th Avenue South, stated that he had to take out a loan for the past two years to pay his taxes and insurance and with this Resolution it would add another increase to his taxes. He also stated that he does not receive any assistance for being handicapped. He suggested that the public should be allowed to vote on the tax increase not just the four to five people who sat on the Commission. He stated that he opposed Resolution 9495.

Dona Stebbins, 811 8th Avenue North, asked about the enterprise funds and what happened to any money that was not spent. Budget Officer Melissa Kinzler stated that any unspent funds went to reserves.

Ms. Stebbins asked why the Commission was looking to pass the budget before the totals from Explore! The Big Sky (EBS) came in. City Manager John Lawton stated that the City did not have any of the numbers for EBS, so the City did not know what the short fall was. The City would have numbers some time this week and if there was a shortfall the finances would come from reserves. This would not cause a tax increase.

Ms. Stebbins asked where the reserve money comes from. City Manager John Lawton stated that most governmental agencies have reserve funds and the City carries reserves in order to have cash on hand when needed. He added that the reserve funds come from under expenditures or overages in revenue. He added that reserves were usually built up over several years.

Stuart Lewin, 615 3rd Avenue North, stated that he was a candidate for City Commission and that he had concerns with the budget. He explained he asked Dick Peterson, an accountant, to review the budget. Mr. Peterson listed several issues following his review. Mr. Lewin gave the Commission a copy of the information he received from Mr. Peterson. The issues were:

1. In the "All Funds Combined Statement" the transfer-in from other funds equaled $5,235,018 and transfer-out to other funds equaled $5,012,263 leaving a difference of $ 222,755. Mr. Peterson suggested these should have balanced.
2. Fund 100-General Fund, increases in City Attorney's Office, Police and Fire Department and how the projected increases would impact the budget.
3. Fund 519-Electric Utility and that the City was covering up funds pertaining to the coal plant project. He stated that this was where the problem lies in the City budget and that there was confusion or the City was covering up what they were attempting to do. He added that the public needed to understand that there was risk of borrowing money for the coal fire project.
4. Capital Improvements programs there was no description or inclusion of Electric Utility project of $1,800,000 and that it was not shown in the budget.
5. The Long Term Debt Schedule for FY 2006 did not include the $1,800,000 on Electric Utility loan.

Mr. Lewin added that any of the issues he listed was reason enough not to approve the budget.

Mayor Gray requested staff respond to the list of budget items presented by Mr. Lewin.

In response to item 1, listed by Mr. Lewin, Budget Officer Melissa Kinzler stated that he was referring to the amended FY 2005 budget; however, the issue before the Commission was the FY 2006 budget. She reminded Mr. Lewin that budgets reflect projected amounts and audits listed actual amounts.

In response to item 2, Budget Officer Melissa Kinzler stated that the City had been looking at changes within the City's legal system and one of the recommended changes was to increase staffing levels in the City's Attorneys office. She added that there may be other changes in future years in City Court. She explained that due to staff limitations and increased number of cases the City Attorney's office was forced to defer or dismiss cases rather then prosecute them. By adding a full time Chief Prosecutor the City will be able to increase revenue from fines and forfeitures because more cases will be prosecuted.

Mayor Gray stated this proposed increase in staffing in the City Attorney's office was at the direction of the City Commission. Mayor Gray asked Ms. Kinzler to address Mr. Peterson's concern about the proposed 60 percent increase in traffic fines. Ms. Kinzler stated the overall projected increase in revenue from traffic fines was 18 percent. However, because City chose to combine different types of revenue that was listed separately in the past it appeared on that line there was a 60 percent increase. The other revenue primarily included funds received from deferred prosecutions.

Also in response to item 2, City Attorney Dave Gliko stated that adding a chief prosecutor had been under study for several years and it was determined a full time permanent prosecutor was necessary. Mayor Gray stated that the work load has also increased in the City Attorney's office and City Court due to the methamphetamine epidemic in the City. The epidemic creates more shoplifting, theft, burglary and assaults. He added that the public also wanted the City Attorney's office to more aggressively prosecute DUIs.

City Manager John Lawton concurred that following public discussion a more aggressive approach to prosecuting DUIs was a priority. He stated that regarding the discussion on revenue from fines and forfeitures, was intentionally budgeted conservatively which removed concerns that the police department will be asked to increase the number of citations written in order to meet revenue projections. The purpose of the police department was to ensure we live in a safe community. The revenue projected in the budget is conservative and if revenue from fines and forfeitures exceeds the projected amount then the City increases the projected revenue the following year.

Ms. Kinzler also stated the Fire and Police Departments budgets did increase by the stated amounts. Both Departments are very labor intensive, and because of the two percent negotiated salary increases and other operating costs such as fuel the total budgets increased

Mayor Gray asked staff to address item 3. City Manager John Lawton stated that there had been several actions that had taken place with the coal plant. All actions had been discussed publicly and that the City borrowed $2 million to begin development toward the coal plant. He added that the City has five co-op partners who borrowed $12 million toward the project. The co-op was responsible for 75 percent of the project. The bonds contain their own budget and had their own public process. He explained that the public utility project did have an element of risk.

Mayor Gray also asked staff to address Items 4 and 5. Budget Officer Kinzler stated the reason the coal plant was not on the capital improvement schedule was that the improvements schedules are long-term plans developed by Public Works over along period of time for the Water, Sewer, Storm Drain and Street Funds. Since the coal plant is a new project, there was no capital improvement plan.

Ms. Kinzler also addressed Item 5. The reason the coal plant is not on the debt schedule is because no actual debt has been issued. Once the actual debt has been issued through an approved debt resolution by the City Commission the debt would be placed on the debt schedule.

Charles Wilcock, 51 Prospect Drive, stated that he was concerned with potential health issues related to the coal-fire technology since it uses mercury.

Jerome Anderson, stated that the budget needed to be trimmed back. He also stated that the coal-fire technology was obsolete and that there were other ways to extract hydrogen from coal without using mercury. He added that the City needed to look at jobs that were costing the City money and if the fees collected from that staff position did not offset its costs that position needed to be eliminated. He suggested, as an example, the attendant at Broadwater Bay. He observed there were times nobody was there but the attendant.

Bonnie Sturgen, 121 2nd Street Northwest, stated she was opposed to the budget.

John Sturgen, 121 2nd Street Northwest, stated the City needed more accountability.

There being no one further to speak in support of or opposition to Resolution 9495, Mayor Gray declared the public hearing closed.

Commissioner Beecher moved, seconded by Commissioner Rosenbaum, that the City Commission adopt Resolution 9495.

Commissioner Beecher stated that during his term as chairman of the Great Falls Local Government Study Commission and as a City Commissioner he commends City staff because they operate on a Chevrolet budget not a Cadillac budget. He also stated that compared to other Montana cities Great Falls ranks among the lowest in wages and in actual budget amounts. He explained that the City continues to compare itself to other cities in Montana as well as other cities in the United States that are similar in size and demographics.

Commissioner Beecher discussed the issue of the City covering up funds and stated that the City has yearly audits from an independent CPA firm. The findings were public record and clean. Additionally, the City continues to receive yearly awards for the finance work that is done.

Commissioner Jovick-Kuntz asked how long the Electric co-op has been in business. She also stated she supported the public power project and that the City had taken a risk with Northwestern Energy and they canceled the City's contract. City Manager John Lawton stated the co-op had been in business between 50 and 70 years.

Commissioner Jovick-Kuntz stated that she had been through five budget sessions and it was a diligent process. She added she supported the budget.

Commissioner Rosenbaum stated he had been with the City for the past ten years and that the City was audited every year and that by now someone would have found something wrong if the City was covering up funds. Also, the City employees were under paid compared to other cities in the state. He added that Commissioners were taxpayers too and tax increases were difficult on all taxpayers. He concluded stating he supported the budget and the public power project.

Mayor Gray stated he sympathized with people on fixed incomes. He added that the budget was a delicate balance each year. He concluded stating he supported the budget and that the budget included the services the community requested. He also stated he supported the coal-fire plant.

Motion carried 4-0.

Fiscal Services Director Coleen Balzarini reported that the City of Great Falls, in an effort to find a more cost effective electrical supply, joined the Southern Montana Electrical Generation and Transmission Co-operative in the fall of 2004.

On October 1, 2004, the City began supplying electricity to the Great Falls Public School system, the Great Falls Airport Authority, Federal Express, Great Falls Housing Authority, Montana Air National Guard, and to its own facilities at $37.60 per mega watt hour. After eight months of service, it has been determined that increasing the supply rate to $40 and adding a $3 per account per month administrative fee is necessary to continue this service. With the proposed increase, Electric City Power will still be able to supply at a rate less than the current default supply rate offered by the distribution utility. Notice of the proposed increase had been sent to each of the entities receiving services under the October 1, 2004, supply contract. These rates will be effective October 1, 2005.

Mayor Gray declared the public hearing open. Speaking against Resolution 9500 was John Hubbard, 615 7th Avenue South, who stated he did not support Resolution 9500 because it was another increase that would affect his pocket book.

Jerome Anderson, asked that if the City was buying the power why couldn't the City keep its rates at the current rate and raise the customers that were currently purchasing power through the City. Mayor Gray stated that it couldn't be done that way.

There being no one further to speak in support of or opposition to Resolution 9500, Mayor Gray declared the public hearing closed.

Commissioner Beecher moved, seconded by Commissioner Jovick-Kuntz, that the City Commission adopt Resolution 9500, increasing the electrical supply rate for Electric City Power to $40 per mega watt hour and approve a $3 per month administrative fee per account on existing contracts.

Motion carried 4-0.

City Attorney Dave Gliko stated that Ordinance 2920 would codify the current practice of allowing 72 hours for the owner, tenant or agent to remove graffiti defacing any premises in the City.

The Property Maintenance Ordinance, Official Codes for the City of Great Falls (OCCGF) 8.51, was adopted in 1995 and required the owner, tenant or agent to remove graffiti defacing any premises in the city. However, no specific time period was designated for removing it. Ordinance 2920 amends 8.51.030(N), codifying what has become an established practice to allow 72 hours for the removal of graffiti after it appears on any premises in the city.

Commissioner Jovick-Kuntz moved, seconded by Commissioners Beecher and Rosenbaum, that the City Commission adopt Ordinance 2920 on final reading.

Mayor Gray asked Mr. Gliko to explain if the City would be held to the same ordinance requirement and the importance removing graffiti quickly. City Attorney Dave Gliko replied the City would be required to follow its ordinances. He added removing graffiti quickly gets the message out to the perpetrator resulting in less graffiti.

John Hubbard, 615 7th Avenue South, stated he should not be responsible for a juvenile offense and asked if the fine money collected for removal of graffiti would be sent to the property owner. City Attorney Dave Gliko stated that it was the property owner's responsibility to clean the graffiti up. He added that a notice would be sent to the property owner with a notice return receipt and if the property owner did not clean the graffiti up within the 72 hour time period a citation would be issued.

Ed Brown, stated that the City should require community service to the criminals who have been charged with graffiti and have them clean up the graffiti not the property owners. Mayor Gray stated that because of liability issues it could not be done.

Motion carried 4-0.

Fiscal Services Director Coleen Balzarini reported that Resolution 9506 would establish a City policy regarding creation of new street light districts. The policy declares that the City would own the infrastructure for new districts, that underground wiring is standard, that financing for new districts can continue to use state statutes and that the City will continue to use the assessment method outlined in state law for electric power supply and maintenance of street light districts.

The City currently has eighteen street lighting districts which consist of 9,349 lights. Of the 9,349 lights, 92 percent are owned by NorthWestern Energy. Street lighting districts have been in existence in one form or another since 1912.

In the past, the City has served only as a billing and collection agent for the electric utility, Montana Power Company and subsequent to its sale to NorthWestern Energy. The electric company has actually provided the system of poles and lights as well as the electricity to power them.

The City, through its electric utility, Electric City Power, supplied electric power to all street lighting districts in Great Falls since October 1, 2004. The City proposed to own and operate any new street lighting districts as allowed by state law. The City determined that it can offer the services that Northwestern Energy offered in the past at rates that will be in the long-term, best interests of its citizens. The policy proposed in Resolution 9506 would enable the City to own and operate new street lighting districts that would be requested by property owners or developers.

Commissioner Rosenbaum moved, seconded by Commissioner Jovick-Kuntz, that the City Commission adopt Resolution 9506 which establishes a policy for new street light districts.

Motion carried 4-0.

Fiscal Services Director Coleen Balzarini reported that adoption of Resolution 9509 is establishing the intent to assess the properties benefiting from the improvements financed through the sale of SID 1301 bonds. Adoption of this resolution will also set a public hearing for Resolution 9491, on August 16, 2005, which will levy and assess a tax upon property within the boundaries of Special Improvement District 1301.

The total anticipated costs of bonding, engineering and capital construction is $967,061. A portion of the costs are to be paid from the proceeds of the Bonds, which are to be payable primarily from special assessments to be levied against Lots 1 and 5, Medical Tech Park, which property will be specifically benefited by the improvements in an amount not less than $630,000. Costs of the improvements in excess of the costs to be assessed against Lots 1 and 5 would be paid from a contribution by the City in the amount of $337,061. This contribution is a payment in advance of an amount equal to the amount of the assessment (excluding there from the proportionate amount of underwriter's discount and Revolving Fund contribution) that would have been levied against the other parcel in the District, described as Medical Tech Park, Lot 1B, Cascade County, Montana and comprising 8.047 acres. The Assessment List included within Resolution 9491 shows the total individual cost per lot within the district based on the square foot method. Assessment payments are divided into 30 equal semi-annual principal and interest payments which will be due on November 30, 2005, through 2020, and May 31, 2005, through 2020.

Commissioner Beecher moved, seconded by Commissioners Jovick-Kuntz and Rosenbaum, that the City Commission adopt Resolution 9509, Preliminary Levy of Special Assessments on property within the district for the purpose of financing the cost of certain local improvements, and set the public hearing on Resolution 9491 for August 16, 2005, at 7:00 pm.

Motion carried 4-0.

Commissioner Beecher moved, seconded by Commissioners Jovick-Kuntz and Rosenbaum, that the City Commission accept the Consent Agenda as printed.

Motion carried 5-0.

Planning Director Ben Rangel reported that Skyline Heights Addition, 7th Supplement, consists of 34 proposed single family residential lots between 9th Street NE and the television facilities of KFBB. The applicants requested the area, consisting of 13.7 acres, be annexed to the City.

On June 28, 2005, the Planning Board conducted a public hearing and at its conclusion unanimously passed a motion recommending the City and County Commissions approve the preliminary plat and the accompanying Findings of Fact subject to the following conditions: any errors or omissions be corrected, the final engineering drawings and specifications be submitted to the Public Works Department for review and approval, entering into an annexation agreement, paying all fees and disposing of the remaining corridor owned by the applicant with the obvious option being incorporation of same into an abutting parcel through preparation of an appropriate survey and deed.

Commissioner Jovick-Kuntz moved, seconded by Commissioner Beecher, that the City Commission approve the preliminary plat of 7th Supplement to Skyline Heights Addition and the accompanying Findings of Fact subject to fulfillment of conditions stipulated by the Planning Board.

Motion carried 4-0.

George Littlefield, 4225 Morningside Circle, Neighborhood Council 4, thanked the Commission and City staff for their support with the Neighborhood Councils.

Bob Stubbs, Neighborhood Council 4, 5501 7th Avenue South, invited the Commission to attend the award ceremony for the Good Neighborhood Award, which will be held Thursday, July 21, 2005, at 6:30 pm, Highwood Trail Court.

Karen Grove, 1816 1st Avenue North, Neighborhood Council 8, invited the Commission to attend an ice cream social in Memorial Park. She added that the Commission would be able to see the improvements that had been done to the park. She also thanked Commissioner Jovick-Kuntz for her involvement with the parades for the past five years.

Audrey Finlayson, 3721 3rd Avenue South, Neighborhood Council 4, invited the Commission to attend their National Night Out, August 2, 2005, from 5-6:30 pm at the Great Fall Senior Center to honor their volunteers. She added that in the past three years they have established 150 neighborhood watches.

City Manager John Lawton stated he spoke to the Local Government Study Commission in Missoula and that the one thing they were interested in was the Neighborhood Council program in Great Falls. He added that Great Falls was well known for its Neighborhood Councils and that the City should be proud of what they have done to improve our community.

Commissioner Beecher acknowledged Captain Corky Grove for receiving Administrator of the Year Award.

Mayor Gray stated that he received a ledger from Tim Spencer that contained the 1908 city costs.

John Stevens, stated that he was a candidate for the Commission and he complimented the City staff and Commission on the fine job they do.

Stuart Lewin, 615 3rd Avenue North, stated that he had been campaigning at Riverfest when was told that he had to pay a $75 fee like the other vendors who were involved during the Riverfest event. He added that two police officers told him he could remain in the park but was not allowed to campaign. Mr. Lewin stated he requested a letter from the City Attorney's office, outlining regulations pertaining to not being allowed to campaign during the event. He added he intended to take the letter to the Attorney's General office to review. Mr. Lewin added that he would be willing to take an apology from the two officers, City Attorney and the City Manager on this matter.

City Attorney Dave Gliko stated that the event required fees from the vendors which was used to help offset the event costs. He added that Mr. Lewin was given the same price as the other vendors. Mr. Gliko said he would provide Mr. Lewin a letter within the next week or two.