Tempers flare at meeting

By KC Bunch

 

On  July 29, the Hill City City Council held a special meeting to address a referendum petition brought by citizens of Hill City with concerns over the financing of the approved Business Improvement (BID) District Project for Area  No. 1.

The area proposed for the beginning of the BID projects is the ally between Main Street and Railroad Avenue in the downtown area. This area also includes what is now the senior citizen center, the public restrooms and the recreational area of the tennis and ball courts. On June 28 the council approved the low bid from MAC Construction in the amount of $1,137,000 for this first phase of the BID projects.

The referendum petition, signed by approximately 8 percent of the population of Hill City, addressed concerns over financing of the projects and the prioritization of the BID project area over other areas of maintenance in the city, such as paving and maintaining residential streets within the city limits.

The special meeting was scheduled after the referendum petition was a discussion item for the common council July 26. 

As the meeting began, the council entered into executive session for approximately 25 minutes to consult with legal counsel, after which time the council resumed the special meeting, with mayor Kathy Skorzewski urging those who wished to speak during the public comment time to sign in for that purpose.

A brief synopsis of the BID Project No. 1 was prepared and read aloud by the mayor, along with a document addressing nine separate points, some heard at the July 27 meeting, and some heard in discussion with the general populace. The document is as follows: 

1. “The city’s ‘Rainy Day’ fund is being used for this project.”

False: Any direct city funds that may be utilized in conjunction with this project are separate and aside from the $750,000 emergency fund that was created and approved by City Council. 

2.  “Residents’ taxes will go up.”

False: The Business Improvement District was created ‘for the purpose of raising revenue through special assessments and/or an occupation tax for the purpose of funding projects enumerated in SDCL 9-55-3, which include, but are not limited to, improvement of any public place, development of activities and promotion of the district area and the construction and repair of public facilities.’  Resolution No. 2018-06 created a $2 per room per night hotel tax to offset these expenditures. 

3. “The city does not make the city’s financial information public.”

False:  Monthly financial updates are provided to the common council at open council meetings. An annual report is also produced on a yearly basis. It is presented at the council meeting and is also published in the Hill City Prevailer. The city is also subject to regular audits required by the state.  These results are shared with council at council meetings as well as published in the Hill City Prevailer.  Financial information is also available on the City of Hill City website and the state’s website.  Stacia Tallon is the city’s finance officer and is available for questions and consultation.  

4.  “This project only benefits the senior center.”

False: The building which is included to receive upgrades is a public facility.  It is one of many city owned areas and buildings that is woefully underutilized. The vision of this property is that it becomes a community center and an event complex, taking all of the city owned property into consideration. The operational component to this and any other city property upgrades includes a utilization plan. This will ensure that the community receive the maximum number of benefits from this public property. 

5. “The space is not big enough.”

False: The plans include adding additional square footage to the existing building. A commercial kitchen is also planned.  This new larger space will allow for both outdoor and indoor activities when completed. 

  6. “This is/should not a priority for the city.”

False: In June 2017 the city adopted the Hill City comprehensive plan. This plan which was created using feedback from residents and community members and outlines the following areas of priority for the community: growth and land use, economic development, transportation and utilities, community facilities and services, housing,  recreation, environmental resources and natural hazards. These are the priorities that have been established by the community members themselves. 

In referencing the comprehensive plan, page 22, action item five, it states to consider more intense development of properties within city limits as an alternative to the outward expansion of Hill City’s city limits to accommodate future growth needs and prevent urban sprawl.

Page 26, action item two.  Undertaking community improvement projects that will make Hill City an attractive place for business to locate. Promoting off-season events and activities that will encourage visitation outside the normal tourist season.

Page 34, action item one.  Considering funding strategies and pursuing options, including working with community groups and individuals, for developing new community facilities and services, such as a community/event center, town square and daycare facility. Helping to facilitate community efforts to develop new public restrooms on Main Street. The activity included in this effort has been previously identified as a priority by the community. 

7. “People did not get to have a voice in the decision.”

False: This activity is in line with the comprehensive plan which is a document created by the people. The BID board activities and projects were all discussed in several open meetings at the board level as well as the council level. The public is invited to attend these meetings. City hall is located at 243 Deerfield Road and the staff is always open for appointments for individual conversations.  All of your elected city officials have city email addresses and are open to discussion. 

8. “Sticker shock. This can be done for less money.”

False: City projects work very differently from those of private individuals. The city is required to follow strict guidelines with regard to bid processes and selection of acceptable contractors. While we are in agreement that a project done by or for a private individual could be done for less money, the city must conduct business as required by state law. 

9. ‘Questionable Return on Investment’

False: The City of Hill City is not a private entity.  We do not produce goods for profit. We are a service organization that is responsible for the benefits and well being of our community. Investments made are rarely quantifiable in numbers or dollars. Investments are for the quality of life of our community and residents, which is priceless.  

The intent is to send this document and the pertinent ordinance and resolutions to all residents of Hill City to ensure they have access to the history and facts.

As the discussion began, Alderman Dale Householder declared a conflict of interest for him with both of the action items: The referendum petition and the BID board project No. 1 expense allocation and left the room during the discussion. City administrator McMacken gave the history of this particular referendum petition and stated that it was both valid and certified.

At that time, city attorney Katelyn Cook then addressed the legal aspect of whether the referendum was addressing a legislative or an administrative decision. She explained that “the power of initiative and referendum is not unlimited, therefore not everything is subject to referendum.”  In short, she determined that the legal conclusion is awarding the contract is an administrative act and that it is not subject to a referendum.

During the public comments, many of those in attendance expressed concerns over monies being spent that were not designated for the BID project.  Many were concerned that the city does not currently have enough money to cover the awarded contract and monies will be used that they feel should go to other city buildings in need of repair or to city streets they see as needing maintenance and/or paving.

Jim Peterson referenced the ordinance and the legal opinion and stated his opinion that the policy had changed, therefore making the act a legislative one and subject to referendum. The council expressed that the monies can come from multiple sources and that the  project can be funded without using taxpayer dollars and that the city will not be using the emergency or street funds.

The council attempted to clarify that the renovation is not simply to remodel the senior center, but that the building will also become a community center for Hill City. They also noted that the attendance was low during the council and budget meetings in which the BID project area was discussed and voted on, and that would have been the time to address these concerns.

Most of the aldermen seemed caught “off-guard” by the referendum petition, as most of the residents they spoke to seemed in favor of the project. Since as much as 8 percent of Hill City signed the petition, the council wanted to address these public concerns.

During the process of the public comments and even after the comments were ended several emotional and heated exchanges between those in attendance and the council took place.  At one point Skorzewski asked the sheriff’s deputies to remove John Johnson, as he was addressing the council at a time when public comment had ceased and requests for him to cease and desist were not heeded. Some attendees were visibly upset and a request from the mayor to return to order was issued multiple times.

At the end of the discussion the motion to deny the referendum was made by alderman Gary Auch, and seconded by alderman Carl Doaty. The roll call of the vote saw both alderman Auch and Doaty vote aye and alderman Gillaspie vote nay, as the motion to deny the petition carried 2-1. Skorzewski and Gillaspie said all of the council members and the city staff are open to discuss these issues, via email, phone or in person. 

At this juncture in the meeting most of the attendees left, as the council continued with the action item of the BID board project No. 1, expense allocation. It was commented that the best time for people to find out where the money was going to come from to fund the project was at this time, as the discussion of the council then turned to the actual allocation of funds. After considerable discussion of the city’s financial plan for this particular project, McMacken suggested the staff research and layout a plan for covering the project and the terms for it going forward. Gillaspie made a motion to that effect, and asked for different options of potential funding through the BID fund or other means with Auch seconding the motion. The motion carried 3-0, with all in favor.