REGULAR MEETING OF THE KOOCHICHING COUNTY BOARD OF COMMISSIONERS
Held on Tuesday, December 16, 2008; 10:25 a.m.

MEMBERS PRESENT: Commissioners Pavleck, Hanson, Adee, Lepper, Briggs

MEMBERS ABSENT: None

OTHERS IN ATTENDANCE: Jaci Nagle, Richard Lehtinen, Dale Olson, Dennis Hummitzsch,
Doug Grindall, Butch Moteberg, Arden Barnes; Reporter Lisa Kascke

2008/12-15 Motion by Hanson, seconded by Lepper to approve the agenda with additions and deletions. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-16 Motion by Hanson, seconded by Briggs to approve the minutes from the December 2, 2008 County Board meeting. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-17 Motion by Hanson, seconded by Lepper approving the 2009 County Budget’s gross levy at $3,677,261 (3% increase over last year of $107,000). The 2009 proposed levy breakdown is as follows: General Revenue - $1,618,909; Community Service - $1,227,325; Public Health - $100,000; Highway - $581,027; Environmental Services - $150,000. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-18 Motion by Hanson, seconded by Lepper authorizing the following County Fund designation for the 2009 County Budget: General Revenue Fund designate $4,600,000 for Cash Flow and $467,708 for the 2009 General Revenue Budget; Highway Fund designate $1,000,000 for Cash Flow and $567,654 for the 2009 Highway Budget; Community Service Fund designate $1,300,000 for Cash Flow and $224,221 for the 2009 KCCS Budget; Public Health Fund designate $250,000 for Cash Flow and $27,000 for the 2009 Health Budget; Environmental Service Fund designate $500,000 for Cash Flow and 0 for the 2009 E.S. Budget; County Development Fund designate $25,000 for Cash Flow and $21,000 for the 2009 County Development Budget; Land and Forestry Fund designate $200,000 for cash flow and $121,000 for the 2009 Land and Forestry Budget. Wastewater Debt Service Fund designate $50,000 for cash flow and $32,092 for the 2009 Wastewater Debt Service Budget;

Further, to adopt the 2009 Budget and Budget Plan in the amount of $20,823,890 plus the 2009 Fund 02 and 13 Supplement Budget in the amount of $471,309 for a grand total of $21,295,199 and to adopt the following directives, effective immediately, and until such time as amended or terminated by the Board:

a. Overtime reduction in all departments. Department heads are directed to reduce overtime in their department except for emergencies;

b. All capital outlay purchases are deferred until after the 2009 Legislative Session ends unless specifically approved by the Board for emergency purposes or under a grant agreement approved by the Board for a specific capital outlay purchase;

c. No payment of first and second half County Budget allocations to outside entities until authorized by the County Board;

d. The 2009 County Budget remains open and subject to adjustments at any time to respond to cuts received as a result of the State’s financial deficit.

e. Department Heads are directed to reduce travel and training in their department and
when traveling to use fuel-efficient vehicles;

f. The Board will schedule a meeting with department heads in early 2009 to review
the state financial deficit and potential impact on the county and review directives
in place at the time of the 2009 County Budget adoption and consider any further directives
to reduce expenditures if the state financial situation should merit tighter control.

g. Upon adoption of the budget, all vacant positions will be deferred to the Personnel
Committee for review and recommendation to fill. This includes full time, part
time and temporary hire positions. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motions carried.

2008/12-19 Motion by Lepper, seconded by Hanson to approve the Memorandum of Agreement with the University of Minnesota Extension Service providing the County’s funding share for a .5 FTE 4-H Program Coordinator, operating expense and Extension Committee expenses as set in the 2009 County Budget with approval contingent of availability of funding by either party to the Agreement as a result of the State’s financial deficit. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-20 Motion by Lepper, seconded by Briggs to designate the Assistant Auditor to approve claims requiring County Board approval for processing year end payouts with all Board claims approved under this authority to come before the County Board at the January 6, 2009 Board meeting for ratification. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-21 Motion by Lepper, seconded by Adee to approve payment of the Auditor claims in the amount of $89,694.05, to approve payment of the Highway claims in the amount of $61,850.73 and to authorize Board Chair’s signature to the Auditor’s November vendor payment listing verifying its review. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-22 Motion by Lepper, seconded by Briggs to reappoint Commissioner Pavleck to the Arrowhead Regional Development Commission’s Board of Directors effective January 15, 2009. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-23 Motion by Adee, seconded by Hanson to approve the purchase of two PCs for the LEC Dispatch Control Center at a cost not to exceed $2,400 as planned in the 2008 E911 Budget and as recommended by the I.S. Manager. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-24 Motion by Hanson, seconded by Briggs to approve the purchase of one PC for the I.S. Unit at a cost not to exceed $1,100 as planned in the 2008 I.S. Budget and as recommended by the I.S. Manager. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-25 Motion by Briggs, seconded by Adee to approve the purchase of 120 Windows Service Client Access Licenses with a cost not to exceed $2,500 with expenditure to come from the 2008 I.S. Budget as recommended by the I.S. Manager. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-26 Motion by Lepper, seconded by Adee accepting the recommendation of the Environmental Service Director to award low bid for a two-year MSW Hauling Contract to Mannco Trucking. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-27 Motion by Lepper, seconded by Briggs adopting the following resolution in opposition to a proposed change to the State Wetland Conservation Act requiring landowner reporting of exempt activities:

WHEREAS, the Wetland Conservation Act (WCA), including portions of Minnesota
Statutes, chapters 103A, 103B, 103E, 103F, and 103G, became effective on January
1,1992 and is administered by local government units (LGU) with technical
assistance from Soil and Water Conservation Districts (SWCD) and oversight by the
Board of Water and Soil Resources (BWSR); and

WHEREAS, Minnesota Statutes and current Rule 8420 exempt certain activities from
regulation under WCA and an exemption applies whether or not the LGU has made an
exemption determination; and

WHEREAS, the current Rule 8420 does not require landowners to gain approval or
report activities that are exempt from WCA; and

WHEREAS, the 1994 and 1996 amendments to WCA which resulted in the exemptions
that are contained in current Rule 8420, and assurances that landowners conducting
exempt activities would truly be exempt without additional requirements, were a
significant reason for Northern Counties to adopt WCA; and

WHEREAS, the BWSR draft Rule 8420 now proposes to require landowner reporting
of all exemptions; and

WHEREAS, the Rule proposal requires a level of technical expertise that landowners
do not possess; and

WHEREAS, in order to comply with the requirement, landowners will request
assistance from the LGU or SWCD: and

WHEREAS, the amount of technical assistance required will be greater in rural
areas, particularly in northern Minnesota where wetlands are abundant; and

WHEREAS, the current amount of funding provided for implementation of WCA is
insufficient to effectively implement the program requirements under current rules; and

WHEREAS, the proposed WCA rule provision to require landowner reporting of
exemptions will result in increased costs to LGUs without any increase in funding for
implementation proposed or likely with a projected state budget deficit; and

WHEREAS, the proposed Rule language to require landowner reporting of exempt
activities is in direct conflict with Minnesota Statute 103G.2241, subdivision 11 and the
intent and spirit of WCA; and

NOW THEREFORE BE IT RESOLVED, counties affiliated with the AMC oppose
any changes to WCA rules to require landowners to gain approval or report exempt
activities.
Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-28 Motion by Lepper, seconded by Hanson requesting the Board Chair to deliver a message from the Koochiching County Board to the State BWSR Board and its WCA Advisory Committee at their meeting scheduled for tomorrow that Koochiching County is at its limit with the continual attempts to change the rules of the State Wetland Conservation Act, the latest being the proposed change to require landowners to report exempt activities on their lands, and that the State needs to honor the Wetland Flexibility Plan that it approved for wetland management in Koochiching County. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

000 The Board requested that time is set on the next County Board agenda under Environmental Service Business to further discuss the WCA rule changing process and the result of the proposal to require landowners to report wetland exemption activities.

2008/12-29 Motion by Hanson, seconded by Lepper to authorize the Board Chair’s signature to the 2009 BSWR Natural Resources Block Grant Agreement in the amount of $55,882 to assist with the management of the County’s water, shoreland and wetland plans and with the condition that no expenditures occur until the grant funds are received due to the State’s financial deficit. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

2008/12-30 Motion by Lepper, seconded by Briggs accepting the recommendation of the Land Commissioner to accept low quote, factoring in delivery and maintenance, for the purchase of three ATVs with Badiuk Equipment in the amount of $17,892 with expenditure from the 2008 Land and Forestry Budget. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

000 The Highway Engineer informed the Board that through the federal stimulus package for construction projects, there is an opportunity to look at funding for bituminous overlays as this is the only project that can be let in 90 days as required under this funding program. The Board was agreeable to the Engineer reviewing road plans and submitting applications as he deems appropriate to benefit the County with final approval of the County Board.

000 A representative from Midcontinent addressed the Board with the Company’s request to transfer the County Franchise for the construction and operation of a cable system from Charter Communication to Midcontinent, as the new owner of the cable company. In response to questions on services, the representative stated he can not speak to the specific of services and rates until the company evaluates the system and determines where they want to go with the service.

2008/12-31 Motion by Briggs, seconded by Lepper authorizing the consent and approval of the County of Koochiching assignment of the cable franchise and system:

WHEREAS, CC VIII Operating LLC (“Grantee”) owns, operates and maintains a cable communications system (the “System”) in Koochiching County, Minnesota (“Grantor”), pursuant to a franchise as set forth in Ordinance No. 96/10-30 adopted on October 15, 1996 (“Franchise”); and

WHEREAS, on October 7, 2008, Grantee entered into an Asset Purchase Agreement (the “Agreement”) with Midcontinent Communications (“Buyer”) pursuant to which Buyer will purchase and acquire certain assets, including the Franchise and the System, from Grantee (“Transaction”) upon the closing of the Transaction contemplated under the Agreement (the “Closing Date”); and

WHEREAS, Grantee and Buyer have requested that the Grantor consent to the Transaction in accordance with the requirements of the Franchise and applicable law to the extent such consent is required (the “Application”); and

WHEREAS, Grantor has reviewed the Application and has determined that the Buyer has the legal, technical, and financial qualifications to operate the cable system under the Franchise and all applicable local, state and federal laws; and

WHEREAS, the Grantor has determined that it will consent to the Transaction and will waive any rights it may have to acquire the System.

NOW, THEREFORE, BE IT RESOLVED that in consideration of the foregoing and the promises set forth herein:

1. Grantor consents to the Transaction to the extent required by the terms of the Franchise or applicable law.

2. Grantor confirms that (a) the Franchise is valid and outstanding and in full force and effect and the Grantee is the duly authorized holder of the Franchise; (b) the Franchise represents the entire understanding of the parties and the Grantee has no obligation to the Grantor other than those specifically stated in the franchise; (c) Grantee is in compliance with the provisions of the Franchise and applicable law; and (d) there are no facts or circumstances known to the Grantor which constitutes or which, with the giving of notice or passage of time or both, would constitute a breach of the Franchise or applicable law.

3. Grantor hereby consents to and approves the assignment, mortgage, pledge or other encumbrance, if any, of the Franchise, System or assets relating thereto, or of the interests in the permitted holder thereof, as collateral for a loan.

4. The Grantor releases Grantee, effective upon the Closing Date, from all obligations and liabilities under the Franchise and applicable law that accrue on and after the Closing Date; provided that Buyer shall assume and be responsible for any obligations and liabilities under the Franchise and applicable law that accrue on and after the Closing Date.

5. Grantor hereby acknowledges the sufficiency of notice and information provided by Grantee and Buyer regarding the Transaction and waives any right to purchase the System that it may have solely for purposes of this Transaction.

6. This Resolution shall have the force of a continuing agreement with the Grantor, Grantee, and Buyer, and Grantor shall not amend or otherwise alter this Resolution without the written consent of Grantee and Buyer.

7. This Resolution shall take effect immediately. Voting yes: Pavleck, Hanson, Adee, Lepper, Briggs. Motion carried.

000 The Board Chair called for public comment at 11:30 a.m. Arden Barnes asked why such a major road was built to Rainy Lake Houseboats. The Highway Engineer stated that the road is used for houseboat and fuel hauling and as a county road, it required a lot of maintenance due to the heavy loads. The new road was built with federal and state dollars and resulted in opening up 32 lots for development and supplied the County with rock for future gravel needs. With no other comment, the Board Chair closed public comment period and adjourned the meeting at 11:20 a.m.