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LMC offers advice, resources to Menahga City Council

Dan Greensweig, administrator of the League of Minnesota Cities (LMC) Insurance Trust, advised the city council to resolve conflicts or potentially see restrictions to city insurance coverage.

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Menahga City Hall
Shannon Geisen / Park Rapids Enterprise

Dan Greensweig, administrator of the League of Minnesota Cities (LMC) Insurance Trust, personally attended Monday’s Menahga City Council meeting to give them fair warning: Resolve the ongoing, internal city conflict or face possible restrictions to the city’s insurance coverage.

Most of Minnesota’s cities belong to LMC Insurance Trust, a self-insured membership pool. Losses in one city affect the other cities, he explained.

Greensweig gave examples – Maplewood, Greenfield and Lake Elmo – where lack of civility on the city council and staff turnover led to lawsuits. The LMC Insurance Trust, he said, sunk over $1 million into claims in each situation.

The trust then “took the extremely unusual step of restricting the coverage we provided to those cities. We don’t do it lightly. When things are seriously off track in one of our members, though, it’s not fair to expect other cities to suffer the consequences of that, and that’s when we’re forced to take action,” he said.

In the 41-year history of the trust, Greensweig said coverage has been non-renewed or restricted only a handful of times. It was difficult for that city to find other insurance “at any kind of price, whatsoever.”

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Greensweig emphasized that LMC Insurance Trust has no opinion about the city council’s policies. They do care that decisions are lawful and that all council members and the public-at-large are deserving of respect, he said. LMC also provides resources for addressing lack of civility and resolving conflict.

Greensweig pointed out, “Incivility is not the same as disagreement. Democracy depends on people having different views and feeling free to express those views. When it becomes a problem is when people stop listening to each other and start personalizing disagreements. It’s really important to avoid demonizing people because they disagree.”

Compromise is what makes democracy work; it’s not a weakness, he continued.

Greensweig noted an LMC facilitator can guide the council through discussions.

Council member Art Huebner, while live streaming the meeting to his personal Facebook page, started to list his grievances over the past three years.

Greensweig reiterated that LMC has no opinion on city policy, but there are “consequences of an inability to work things out.” He concluded by saying what is happening at Menahga City Hall has the attention of the LMC Insurance Trust. If the conflict continues, he said he’ll have a conversation about Menahga’s coverage with his fellow board members.

Deputy clerk resigns

During the public comment portion of the meeting, Police Chief Adam Gunderson announced that Deputy Clerk Tanya Edwards resigned at 2 p.m. Monday. She did not leave a resignation letter for the council, he said.

Gunderson claimed he is not allowed to speak during council meetings and handed a letter to Greensweig.

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Menahga resident Jesse Welch expressed her concerns about the council’s decision to no longer utilize GoToMeeting and whether or not to allow council members to appear remotely. She prefaced it by saying, “I truly believe that each and every member on this council truly has the city as well as citizens’ best interest at heart. However, this fact gets lost in translation.”

Greenwood Administrator Laura Ahlf spoke to Welch’s comments, saying the public often doesn’t understand or hear everything. For example, there is a three-day public notice requirement in order for a council member to attend remotely, she explained.

Ahlf agreed there is “a lot of turmoil” and the council needs to work together. She pointed out that city employees should work harder “to do the job you’ve asked them to do instead of fighting or disagreeing.”

The council voted 3-2, with council members Huebner and Robyn Keranan opposed, to hire Dustyne Hewitt as city secretary. Her start date was Tuesday, March 15, pending a successful background check. She will be paid $17.92 per hour.

S&P Global Rating

The council learned that S&P Global Ratings affirmed its BB+ rating for the city’s general obligation debt and removed the negative rating from CreditWatch.

According to the S&P report, “The city accumulated a backlog of deferred capital needs, which we believe is due to the political discord and leadership turnover in recent years.”

The report continues that, in the 2020 audit, the available fund balance “fell to a very low nominal level, primarily because of capital purchases.”

S&P noted the fiscal 2021 budget was amended to address capital repair and maintenance, plus the city recently adopted a capital improvement plan.

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While that was a positive step, the report says, “In our opinion, due to governance and finance oversight issues, the possibility of unforeseen costs arising remains particularly elevated, given the track record of not incorporating capital costs into past budgets.”

The city’s ability to cut spending is “limited,” as most nonessential items have already been cut from the budget.

S&P Global said, “although efforts to improve internal controls are a positive development, we will continue to monitor that they are followed and effective.”

In other business, the council did as follows:

  • Implemented water and sewer rate increases, effective April 2022. The water flat rate rose from $17.53 to $20.25. The sewer flat rate went from $14.48 to $14.80. Water usage rates were also adjusted upwards. A 2015 utility rate study, prepared by Ehlers Inc., had recommended annual increases, but those were not implemented for the past two years.
  • Updated the city fee schedule, effective March 14. Huebner voted against it.
  • Authorized temporary technician Jensine Kurtti to implement internal control procedures, such as cash-handling roles, recording deposits and comparing deposits to general ledger entries, as provided by Eide Bailly. The motion passed 3-2, with Huebner and Keranen opposed. Mayor Liz Olson reminded them that, in the absence of a city administrator and at the city attorney’s recommendation, Kurtti was appointed the responsible authority at the Feb. 14 meeting.
  • Upon Kurtti’s request, clarified that she should forward citizen and employee complaints to the city attorney. They also agreed that council members should not be using the city’s copy machine; any city business that needs to be copied should be given to city staff instead.
  • Approved a two-year, fire protection contract with Blueberry, Huntersville and Shell River townships. Based on population, Blueberry Township will pay $34,829, Huntersville $9,608 and Shell River $15,613.
  • Approved the $2,868 quote from Midco Diving and Marine Service of Rapid City, S.D. to clean and inspect the city’s water tank.
  • Approved council members Dan Warmbold and Durwin Tomperi to serve on the Sourcewell Representative Assembly for 2022-23.
RELATED COVERAGE:
The Menahga City Council held a special meeting on Friday, Jan. 20 to speak to the two candidates.

Shannon Geisen is editor of the Park Rapids Enterprise.
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