The Blog from City Hall

Today’s Excellence Behind The Scenes person is Katharine Caliri. Katharine is an Accountant, and a darned good one. That’s Katharine in the photos above (or to the left) in her natural work habitat: reviewing paper documents, working on electronic spreadsheets, helping her Finance Division co-worker Barb Baer, and participating in a meeting with her co-workers and our IT Manager Lisa Wu.

Katharine has worked for the City for 2 1/2 years. She hits her 3 year anniversary on March 1, 2007. She grew up in Eden Prairie. She’s one of the few City employees that can claim that. She’s been married for eight years and has two kids: a 3 year old son and a 7 month old daughter. She is interested in movies, pop culture, writing, amateur photography and managing a family website. I’ve seen her website. It’s pretty good. She also said that one of her hobbies is keeping up with “dirty dishes, dirty diapers and home repairs”. Now that’s a challenge!

Katharine said her favorite work related memory was the quick realization she experienced that the Police Officers sitting beside her in her initial new employee orientation class were indeed armed with handguns. Katharine told me that one of the things she enjoys most about her job is the opportunities she has on almost a daily basis to help someone solve a problem by providing them advice, information or a helping hand.

Unless you’re a City of Eden Prairie employee, you probably won’t get to meet Katharine much. Her work keeps her squarely Behind The Scenes. Katharine reviews and processes invoices and internal financial statements for two of our most important internal support services: the Facilities Management Division and the Information Technology Division. Katharine also assists with the gathering of information for the City’s annual financial audit and completes a variety of intergovernmental surveys. During the budget making process, Katharine has special responsibilities for projecting the City’s utilities costs, which is a challenging task given the volatility of gas and electric costs and the wide spectrum of facilities operated by the City.

It’s people like Katharine that keep our employees who directly serve the public up and running. She provides them the information they need to make good decisions in the field and good decisions when planning next year’s budget. When we asked Katharine what her favorite salad dressing was she said, “Is there a dark chocolate salad dressing?” Katharine, as long as you work here, you can put anything on your salad you want to.

I composed a week long series last year for my blog that I called Excellence Behind The Scenes to highlight some of the truly excellent people who work for the City of Eden Prairie that our residents will probably never meet. These employees work behind the scenes to support the work of our more visible employees that residents see on television, in the newspapers, at the service counter, or at public meetings. We have excellence among our visible employees too, but they often their excellence recognized by the public too. More often that you might think. Our Behind The Scenes employees, however, don’t get much in the way of public recognition. This short posting in my blog is my way of recognizing the folks that support the folks that provide exceptional public services here in Eden Prairie.

My first Excellence Behind The Scenes example this week is Scott Demko. Scott is a Mechanic in our Fleet Services Division in our Public Works Department. Scott has worked for the City for five years. He is a motorcyclist, hunter and NASCAR fan. Scott has a wife, Stephanie, and two kids: Logan (8) and Lexie (6).

Scott is an exceptionally skilled mechanic. He works on the City’s fleet of over 200+ police cars, dump trucks, large commercial mowers, and pickup work trucks. He must be able to prioritize his work, diagnose problems and fix problems in order to keep our Police on patrol, our Firefighters ready to move on a moment’s notice, our Water Division employees able to unplug the snarled sewer line, and our Parks Maintenance guys mowing the soccer fields. All these employees depend on Scott, and his co-workers in the Fleet Services Division, to do excellent work; to do it on short order; and to do it under budget.

One aspect of Scott’s job that he gets particular satisfaction from is setting up new Police patrol cars. Our City staff adds thousands of dollars of added-value to our Police patrol vehicles by installing the light bars, computers and other post-production equipment to our cars. Scott told me that the thing he likes most about his job is the look on a Police officer’s face when the officer gets behind the wheel of a newly decked out Police patrol vehicle. I think that says a lot about Scott Demko right there. He does great work for the City of Eden Prairie, and that’s why he is part of my Excellence Behind The Scenes series this year.

We kicked off our annual City employee Charitable Giving Campaign 2006 last week. The photo to the left is one of the promo photos for this year’s campaign. One of the incentives (if you want to call it that) for this year’s campaign is the chance to win (if you want to call it that) a Belgian waffle breakfast cooked for your work team by me and the Department Director staff.

For the next two weeks, our Human Resources staff will be collecting pledges and donations to benefit PROP, Greater Twin Cities United Way and Community Health Charities of Minnesota. Last year, City of Eden Prairie employees raised more than $10,600 during our charitable giving campaign and this year our goal is to increase participation and try to increase that number. We encourage all City employees to participate and urge them to remember that a contribution of any amount makes a difference!

For the waffle breakfast competition, we divided our City staff into 13 teams:

Team 1: Parks Maintenance/Forestry
Team 2: Recreation/Parks and Recreation Administration
Team 3: Community Development
Team 4: Engineering
Team 5: Streets/Fleets
Team 6: Utilities
Team 7: Fire/Building Inspections
Team 8: Finance/Liquor Operations/Communications
Team 9: IT/Facilities/Support Services/HR/OCM Administration
Team 10: Patrol: Munro/Wyffles/Good
Team 11: Patrol: Wood/Staaf/Vosbeek
Team 12: Investigative Operations/Office of the Police Chief
Team 13: Police Support Operations

The team with the highest percentage of pledges will win the breakfast! I’m not sure who to root for in this competition. I am hoping the most tolerant team with the least amount of collective taste buds pulls it out in the end. Our charities will be the real winners. I’m really rooting for them.

I work with a lot of smart people here at the City of Eden Prairie. I’m fortunate that many of them read my blog. I’m even luckier that they’ll give me constructive criticism on my posts. I got a good dose of constructive criticism yesterday about the posting I wrote on Monday, October 23 entitled “Eden Prairie Home Prices and Values“. It came from our City Assessor Steve Sinell.

Now the most important thing you should know about Steve Sinell is that he is a fact-driven man. (See my Jan. 7, 2005 blog entry for more about Steve.) He is a numbers guy. Steve’s work must stand up to intense scrutiny. Residents pay attention when someone from the government (i.e. - the City Assessor) tells them what their property is worth. Steve and his staff work very carefully to back up their work with numbers, numbers and more numbers. I always tell people that Steve Sinell doesn’t make the news, he only reports it. It’s really true. The value he assesses to a property isn’t based on his gut instinct. It’s based on market values, sales prices and building rental income information.

So when I composed a posting about home prices and values in Eden Prairie, Steve noticed it. He could not disagree with the facts of the post. But he did tell me that the facts on sales prices from one month in 2005 compared to the same month in 2006 did not really tell an accurate story about what’s happening with home values and prices in Eden Prairie. I couldn’t disagree with Steve, so I asked him to give me a little help with subject. He did. Below is the redo of the Monday, October 23, 2006 posting called “Eden Prairie Home Prices and Values”.

Thanks Steve.
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I get a lot of email. I’m on a lot of email listserves. I don’t mind that. It allows me to catch breaking news and get many perspectives on the news. For example, I got an email update last week from the Minneapolis Area Association of Realtors updating me on the current residential real estate picture of Eden Prairie - from their perspective. Here’s what they are seeing at the moment.In September 2006 there were 195 new listings. This compared to 189 new listings in September 2005. Listings were up 3.2% from last year to this year. Closed sales, however, were down 22.6% in September 2006 compared to September 2005.

The average sales price in September 2006: $416,477. In September 2005: $436,329. Percent change in average sales price from last year to this year: -4.5%. Good news or bad news? Depends on which side of the table you’re on, I suppose.

For the Twin Cities as a whole, new listings were down 5.1% in September 2006 compared to September 2005. Closed sales were down 23.7% for the same time period. The average sales price for a Twin Cities home in September 2005 was $274,670. In September 2006: 283,583; an increase of 3.2%.

Quick take on the numbers: Yes, Eden Prairie home sales prices may be down 4.5% from September 2005 to September 2006, but they are still 47% higher than the average sales price in the Twin Cities.

But just looking at monthly sale prices can be deceiving. A comparison of price changes from August 2006 to August 2005 as an indicator of market change is an unreliable statistic due to small sample size and dissimilar samples.

If the August 2005 group of sold properties (sample) and the August 2006 group that sold (sample) were of a similar makeup the price change and the market change could be the same. But usually they are not – thus the volatility from month- to-month in average and median sale prices. The change in the annual average sale price and median price are much more likely to represent market change as the sample size is much greater. Even the annual price changes are vulnerable to subtle changes in the market.

For example, if in September 2005 15% of the homes that sold were in the high end of the price range and in September 2006 only 3% were in the high end it can skew the average sales price for the month. Here’s a real example from single family sales in Eden Prairie:

For the time period 10/1/2005 to 9/30/06, there were 505 sales in Eden Prairie with an average sale price of $470,697.

For the time period 10/1/2004 to 9/30/05, there were 655 sales in Eden Prairie with an average sale price of $468,370.

For the month of August 2006, there were 55 sales in Eden Prairie with an average sales price of $485,578.

For the month of August 2005, there were 65 sales in Eden Prairie with an average sales price of $499,298.

Based on Annual Price Change, the data would suggest an annual average price increase of 0.50%. The monthly statistic would suggest a decrease of 2.7%. Other indices for single family home prices would suggest a +3% price change on those homes that sold (adjusting for sample makeup).

Here’s an even more specific example.

In the Fairfield neighborhood in Eden Prairie, during the month of August 2006, were 3 sales with an average sales price of $454,000. In the same neighborhood in August 2005, there were 2 sales with an average sales price of $395,000. This suggests a 15% price increase from 2005 to 2006, which is factually correct but probably doesn’t tell the whole story.

Moral of the Story: Monthly sales volume and sales price are important and may represent a “market change”, or not. Annual sales and price information will ultimately tell us a more complete story.

I get a lot of email. I’m on a lot of email listserves. I don’t mind that. It allows me to catch breaking news and get many perspectives on the news. For example, I got an email update last week from the Minneapolis Area Association of Realtors updating me on the current residential real estate picture of Eden Prairie - from their perspective. Here’s what they are seeing at the moment.

In September 2006 there were 195 new listings. This compared to 189 new listings in September 2005. Listings were up 3.2% from last year to this year. Closed sales, however, were down 22.6% in September 2006 compared to September 2005. The average sales price in September 2006: $416,477. In September 2005: $436,329. Percent change in average sales price from last year to this year: -4.5%. Good news or bad news? Depends on which side of the table you’re on, I suppose.

For the Twin Cities as a whole, new listings were down 5.1% in September 2006 compared to September 2005. Closed sales were down 23.7% for the same time period. The average sales price for a Twin Cities home in September 2005 was $274,670. In September 2006: 283,583; an increase of 3.2%.

Quick take on the numbers: Yes, Eden Prairie home sales prices may be down 4.5% from September 2005 to September 2006, but they are still 47% higher than the average sales price in the Twin Cities. Kind of a mixed bag for our “affordable housing” goals.

The City Council had a short agenda last night for their final regular meeting prior to this year’s Council elections. Mayor Tyra-Lukens is retiring from her position on the Council at the end of this calendar year. Just prior to last night’s meeting the Mayor had the opportunity to call three new pieces of fire equipment into service: a new ladder truck, a new fire rescue boat and a new airport crash/rescue truck. We host a brief ceremony each time we call new fire equipment into service which involves a short benediction from a member of our Public Safety Chaplain Service followed by the Mayor’s official call into our 911 Dispatch Center ordering the new equipment to be officially logged in as “in service”. It’s a short ceremony, but an important connecting point for elected officials to see the tangible results of their decisions. In the picture, Mayor Tyra-Lukens is shown just to the right of Father Tim Power with the City Council and a group of Cub Scouts from Pack 479. There’s also a Boy Scout in there too, also from Pack 479.

The other photo shows the Mayor with two new signs that we will be installing at the entrances into Eden Prairie. One sign recognizes the City’s 22 consecutive years as as a Tree City USA and the other recognizes the City’s newest recognition as a participant in the Governor’s Fit City program. I’ve included this photo because it is symbolic of two issues the Mayor has advocated for since becoming the City’s Mayor in 2002: environmental protection and personal physical fitness. She feels strongly about both issues and has encouraged staff to work hard on both issues. I’m pretty sure she’ll continue to work on both issues after she leaves her role as Mayor at the end of this year.

Look for the new signs to go up later this fall.

The Mayor got a wonderful letter about one of our Facilities Division employees, Mr. Shaun Sullivan. That’s a photo of Shaun to the left. I have included a PDF copy of the letter in today’s posting. Take a minute to click on it and read it. I’ve taken the name off the letter to preserve the writer’s privacy. It’s very sweet and describes Shaun to a tee.

I’ll have to say that my initial reaction when I read this letter was: “I’m not surprised.” I’ll bet that most people here at the City that work with Shaun will have a similar reaction. Shaun knows customer service. He gets it. We’re lucky to have a guy with his instincts on our staff.

Great work Shaun!

The City hosted a very successful Open House event this past Saturday. It was a wonderful day. We had a beautiful blue sky and a bright sunny sun. It was a little cool and a little windy, but not cool and windy enough to damper the 1,000+ residents from showing up and checking out what we do here. I’ve included a few photos from the event. You can click on thumbnail photo to see it in a larger size, then hit your “back” button to come back to my blog.

I heard many positive comments from the citizens I spoke with on Saturday. They were impressed with the facilities and equipment they saw. But I heard even more positive comments about the hospitality of the City employees hosting the events at City Center, Water Treatment Plan, Streets & Parks Maintenance Facility and the Fire Station. Citizens told me they were happy they had the chance to see City facilities close-up and to meet City employees on a one-on-one basis.

Major kudos to the City staff who organized event. People like Tracey Schowalter, Kim Cummings, Sandy Werts, Pete Hammerlind, Tom Tesch, Laurie Obiazor, Sonja-Ritchie-Roy, John Carlon, Larry Doing and many more. Well done!

The City is hosting a big Open House event tomorrow here at City Center, 8080 Mitchell Road. The event starts at 11:00 am and runs through to 2:00 pm. You can learn more information by clicking here: Citywide Open House Event Information.

Looks like we’ll have some partial sun and cool temperatures. I hope anyone reading this in the Eden Prairie area will drop on by and see our facilities and operations, and meet the many fine employees that deliver our services.

I’ll see you there,

Scott

It may not look like it, but that’s environmental protection equipment in the photo to the left. What is it? It’s the electrical and alarm panel for a new sewer ejector pump at the City’s Outdoor Center adjacent to Staring Lake.

After many years of discussion and planning the ejector pump is now operating at the Outdoor Center. This means this facility is finally connected to the city sanitary sewer system. Prior to the installation of the ejector pump, restrooms at the Outdoor Center drained into a tank that had to be constantly monitored and pumped. The tank was subject to occasional problems, especially if lake levels rose to high.

The new ejector pump is inside a holding tank. When waste inside the holding tank rises to a certain level it triggers a float switch which activates the pump to propel the sewage through an 800 feet pipe to the trunk sanitary sewer line adjacent to Staring Lake Parkway. This means that the holding tank level doesn’t need constant monitoring and we will not need monthly pumping unless the pump system has a malfunction.

Why is this important? Connecting the Outdoor Center to the City’s sanitary sewer system is an important step forward because it raises the level of environmental protection of Staring Lake - one of the City’s most valuable natural resources. I know it looks like just a piece of plywood with a couple of electrical boxes tacked on to it, but it’s much more important than that. It’s the visible side of the City’s continued emphasis on protecting our local environment.

Enjoy!

CNS is an Eden Prairie company. They are located in the Golden Triangle industrial area. The company made the front page of Monday’s Star Tribune Business section with the announcement that it has agreed to be purchased by Europe’s largest pharmaceutical company, GlaxoSmithKline for $566,000,000. You may not know the name, but you probably know their products. They make BreathRight nasal strips and Fiber Choice nutritional supplements. Mayor Tyra-Lukens, Economic Development Manager David Lindahl, and I paid one of our business “Meet & Greet: visits to CNS in 2004. It was a very interesting visit. CNS’s CEO, Marti Moffitt, is an inspiring leader. She managed a turnaround in the company that led to this sale to Glaxo. No word yet on what this sale means to Eden Prairie, but we’re going to look into it very soon.

On the front page of yesterday’s Star Tribune Business section there was a positive story about another Eden Prairie company - Super Valu, Inc. Super Valu has a higher consumer profile than CNS. They are the grocery giant of the Midwest. In the graphic to the left is a display of all the different logos uses to define their various consumer brands. I wrote about Super Valu earlier this year when they announced their acquisition of the much larger grocery operation Albertsons. The Star Tribune story talks about the announcement by Super Valu of their first full quarterly earnings statement since the Albertson’s acquisition. The announcement surprised financial skeptics who said the Albertson’s purchase was too big of a bite for Super Valu. They were wrong. Super Valu turned a nice profit last quarter. Congrats all around.

Eden Prairie has a vibrant and successful business community. It’s nice to read about their success in the paper.

My staff and I have been working on some statistical analysis of the City’s property tax policies and practices over the past four years. The City’s has taken a couple of metaphorical punches lately that our property taxing behavior has been out of the mainstream. Well, when I want to determine if anything is out of the mainstream, I first must figure out what the “mainstream” is. For the City of Eden Prairie, we usually define the mainstream as the Municipal Legislative Commission (MLC) cities. These are the cities within the Twin Cities metro area that are most like our city. We are alike demographically, geographically, and we all received very little (if any) financial assistance from the State government to support our local municipal operations.

I think the best measure of our property tax burden is the Net Levy. I think it’s the best measure because it really is the net tax burden that we impose on our residents through the property tax formula. Using the Net Property Tax Levy as the measure and the MLC cities as the “mainstream”, here’s how Eden Prairie has performed during the period 2003-2006 .  The link will take you to an 8-page PDF of a memorandum that i prepared for the City Council explaining the data.

If you don’t like taxes, (and who does, really?) this information will not impress you.  If you are, however, interested in how differently comparable communities in the Twin Cities have taxed their respective property taxpayers to finance their municipal operations, then you might find this information quite interesting. 

My summation of the data:  Eden Prairie: Not Bad.  Not bad at all. 

Mayor Tyra-Lukens and I attended an event yesterday at Eaton Corporation’s Eden Prairie facilities to see three new hybrid vehicles that have been developed by Eaton right here in Eden Prairie. The hybrid vehicles are part of a public-private partnership among Eaton, The United States Environmental Protection Agency (EPA), United Parcel Service (UPS), International Truck & Engine, and the U.S. Army. Sohan Uppal, Vice President of Technology for Eaton Corporation hosted the event. The key invitee, besides Mayor Tyra-Lukens, of course, was U.S. Senator Norm Coleman.

The purpose of the event was to demonstrate Eaton’s new Hydraulic Launch Assist (HLA) technology. I am not the right guy to explain how this technology works, but I’ll give it a try. The technology captures power from the vehicle as it decelerates and stores it in a hydraulic system in the power train of the vehicle. When you press the accelerator to start the vehicle moving again, the stored power helps the “launch” the vehicle into motion again. After you are moving again, the vehicle’s motor kicks in like usual.

We saw three samples of vehicles that use this technology: a chassis for a future garbage truck, a sample airport shuttle bus, and a UPS delivery truck. The start & stop use patterns of these vehicles are ideal for this technology. The HLA technology is these vehicles has increased their fuel efficiency by 50-70% and lowers the emission of greenhouse gases by 40%! UPS is putting several delivery trucks into regular use in the Detroit area soon to test the system in a real life environment.

I rode in the shuttle bus prototype driven by Senator Coleman. I got to drive it as well. It drove like a regular vehicle. Mayor Tyra-Lukens drove all three vehicle. She said she liked the garbage truck model best. Senator Coleman said he liked the UPS truck best, and that it was always good to have another skill set to fall back on someday.

In the world we live in today, energy efficiency and energy independence in America is a matter of national security. Senator Coleman drove that point home in his remarks to the assembled Eaton engineers and scientists. The work they are doing on this project - right here in Eden Prairie, I might add - is work that is good for their company, good for our natural environment, and good for our country. It was an honor to see it first hand at this early stage in its development.

At last night’s City Council meeting, the City Council authorized staff to proceed with the preparation of an Environmental Assessment Worksheet (EAW) for the proposed Prospect Road project. Part of Prospect Road already exists. It currently intersects with Spring Road south of Grace Church. It is the primary access road for one of the new Hennepin Village developments. I snapped the middle photo of the current end of Prospect Road in July. This view is looking west. The photo on the right is a view of the future route of Prospect Road looking east from its future planned intersection at Eden Prairie Road.

Concerns have been raised about the Prospect Road project because the road will cut through area that is currently quite scenic. The road must also cross a creek which is planned to be routed through a culvert. These are two environmental concerns raised by citizens.

The road is important to City staff for two reasons. From a transportation viewpoint, the road will introduce an East-West connecting street from Eden Prairie Road to Spring Road, which are the two primary North-South streets serving southern Eden Prairie. From a public safety viewpoint, the road is important because it provides Police and Fire services a second way to access the current Hennepin Village development off of Spring Road and the future Hennepin Village development on Eden Prairie Road. Two methods of access to developments of 100+ housing units is important for Police and Fire to serve the area safely.

The Council’s action last night asked staff to research the environmental concerns and to present the findings of the research back to the Council in the Environmental Assessment Worksheet (EAW) format. An EAW is a report format that requires staff to answer a number of standard questions about a proposed development of land. In this case, in addition to the standard questions, staff will also be researching the impact of crossing the creek with a small bridge rather than the planned culvert. We will also be studying the potential hydrology impacts of the this project on the Miller Spring.

Staff will starting the EAW process immediately. We believe this issue will come back to the Council sometime early next year.

A few weeks ago I wrote about the hypothetical tax burden for a $414,000 home in a selected number of Hennepin County cities. I got some good feedback from that posting. One of the replies I received asked what the tax burden would be if the hypothetical property were a business rather than a home. Good question. So I sat down today with the Eden Prairie City Assessor, Mr. Steve Sinell, to discuss that question. Steve came up with the following tax burden data that I think is very interesting.

The example I’ll use is for a residential home valued at $3,000,000; and apartment building valued at $3,000,000; and a commercial business valued at $3,000,000 for taxes payable in Eden Prairie in 2006. Here are the numbers:

The $3,000,000 residential homeowner would pay $36,507.92 in total property taxes. Of this total, $9,165.90, or 25.11%, would go to the City. Hennepin County would get $12,472.50. The Eden Prairie School District would get $12,159.90. Other minor taxing bodies pick up the rest.

For the $3,000,000 apartment building owner would pay $44,065.65 in total property taxes. Of this total, the City gets $11,307.98 (25.6%), Hennepin County gets $15,590.63, and the School District gets $13,898.93. The City, County, and School District take 92% of the taxes from this taxpayer, and several other minor taxing bodies get the rest.

The $3,000,000 commercial business owner will pay $100,595.97 in total property taxes. Uff da. Of this total, the City gets $11,421.01 (11.3%), the County gets $15,742.06, and the School District gets $13,983.38. The taxes received by the City, County and School District in this example are remarkably similar to what the same three taxing bodies receive from the residential homeowner and the apartment building owner. However, in the commercial business example, the City, County, and School District’s taxes only comprise 41% of the total tax burden.

The biggest share of the tax burden for the $3,000,000 commercial business taxpayer in Eden Prairie, Minnesota is imposed upon him/her by the State of Minnesota. The State’s General Property Tax, which residential properties do not pay, costs this business taxpayer $30,115.00 in 2006. Coming in a close second for the commercial business taxpayer is his/her contribution to the State’s Fiscal Disparities Program, which for this hypothetical $3,000,000 business owner is $26,048.28 in 2006. So between the State’s General Property Tax and their Fiscal Disparities Program, the state government’s fiscal burden on this taxpayer is $56,163.28, or 56% of this taxpayer’s total tax burden. Or, looked at another way, about five times the tax burden put on this particular taxpayer by the City of Eden Prairie.

Keep this tax burden relationship in mind the next time you hear a State elected official decry the tax burden put on businesses by cities, counties and schools. Now you know where the real burden comes from.