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The Lancaster City Council met for its regular meeting on Wednesday, February 9, 2011, at 7:00 p.m. in the City Hall.  The following members were present: Rice, Swenson, Olson, Stenquist and Barron.

Olson moved to approve the minutes of the January 12, 2011 Annual meeting, second by Barron and carried.   A copy of the Minutes will be posted at the Lancaster City Hall and U.S. Post Office and available upon request to the clerk.

The council reviewed the February 2011 Bills to be paid. Stenquist moved to approve the bills for payment, second by Swenson and carried.  An abstract of bills will be posted with the minutes and are available upon request to the clerk.

Clerk presented a drug use policy for the council to review.  Stenquist moved to approve the drug use policy, second by Olson and carried.

Council reviewed a Legal Service contract from Bruce Nielsen for services in regards to the USDA Loan Application.  Nielsenís proposed hourly rate is $95.00 plus expenses.  Stenquist moved to accept the Legal Service contract as presented, second by Barron and carried.

Rice discussed the need for an option to purchase the property directly south of the Prime Security Bank building from Lanvest, Properties Inc. for the community center project.  Lanvest agreed to enter into the option for $1.00 if approved by the council.  Olson moved to approve the option to purchase with Lanvest Properties, Inc. and allow the Mayor and clerk to execute the document, second by Barron and carried.

The council reviewed the revolving loan guidelines regarding Subordinations and refinancing of Loans and the 1% loan origination fees.  Stenquist moved to add the stipulation that any person or corporation requesting a subordination or refinancing of a loan will be required to pay any expenses incurred by the city for request; also, to amend the original 1% loan origination fee to only include meetings and attorney legal fees, this will not include out of pocket expenses such as abstracting, mortgage registration fees and UCC filing fees, second by Swenson and carried. 

Luke Nordin met with the council to discuss his request for a loan from the revolving loan fund to purchase the Lancaster Building Supply store.  Luke requests a loan of $85,000.00 from the city to his corporation with the city having a second position on all inventory, equipment and accounts receivables.  The council discussed the loan requirements with Luke.  Barron moved to loan of $75,000.00 at 3% interest for 15 years to Luke Nordin and/or the corporation/ he will be forming, second by Olson and carried.   The following conditions are to apply:  Equal monthly payments, Luke and his spouse, Britta would also provided personal guarantees along with the corporation, Term Life insurance to be no less than the amount owed.

Rice discussed the USDA loan application process and the need to make an application as soon as possible in order to have the best chance at insuring there will be funds available for a loan.  Even if the application is accepted the council doesnít have to take the loan or can reduce the amount of  loan requested.  The USDA representative has informed Rice that the city interest rate would not exceed 4.4% and the city could payback the loan over 40 years.  Swenson moved to proceed with the USDA loan application for an amount not to exceed $415,000.00 and allow the Mayor and Clerk to execute all documents as stated in the resolution attached, second by Barron and carried.

Barron moved to change the Annual Fire Relief Association meeting to March 16th , 8:00 PM at the Lancaster Fire Hall, second by Olson and carried.

A notice from KaMaR of termination of contract for recycling pickup was received effective March 5, 2011.  Also, presented to the council from Markit Landfill is a recycling contract to do exactly the same service as KaMaR effective March 5, 2011.  Barron moved to accept the contract and allow the Mayor and Clerk to execute the document, second by Stenquist and carried.

Clerk is going to attend the League of MN Cities insurance trust meeting on March 29th in Mahnomen.

Sebenaler thanked the council for their support during his time as a city employee.

Council reviewed the final Liquor Store Profit and Loss Statement for 2010 and discussed the audit meeting attended by the Mayor and clerk with Gordon Dale, the city auditor.  The auditor suggested implementing stronger internal controls and agreed with the Mayors suggestion of implementing Quarterly Inventories.

Clerk reported that Hanson Manufacturing is 2 months behind in their loan payments.  Council will continue to monitor the loan.


Council reviewed the January City and Liquor Store financial information, Liquor Store Daily sales and Gambling Monthly receipts. 

Olson moved to set a hearing to receive public input from citizens regarding the application for an Outdoor Recreation Grant for improvements to the Highway 59 park and campground, second by Stenquist and carried.

Rice reported that the Kittson county highway Department has offered to lease a single axel snowplow truck to the city for snow removal to lesson there snowplow time spent in the city.  The council discussed the fact that the city doesnít have enough manpower for the truck and that the snowplow need only open their own county roads running through the city and the streets adjacent to the school in a snowfall event and then could return to town after other roads have been cleared to complete the city streets.

The defunct Lancaster Cub Scout Pack #66 has made a donation to the Lancaster Community Center Project in the amount of $517.37.  The Community Center Savings total is $8,295.51.

The city is in need of a licensed water and wastewater supervisor until the current Public Works Director passes these two tests.  Tom Sebenaler has proposed that he will fill this position and complete all necessary tests, paperwork, training and supervision for $420.00/month as a Water and Wastewater Supervisor. Barron moved to hire Tom Sebenaler as the Water and Wastewater Supervisor, as temporary non benefitted employee of the city effective February 16, 2011, second by Stenquest and carried.

Tom Sebenaler has also indicated that he would also be available to work as the Highway 59 Park and Sports Complex attendant/maintenance worker at the scheduled pay rate of $12.03/hour.  Olson moved to hire Sebenaler for this position and also pay Sebenaler for any additional maintenance help at the rate of $12.03/hr. as per the city pay rate schedule, second by Barron and carried.

Council Adjourned as there was no further council business.


Carol Johnson








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