The Winnebago City Council tackled a long agenda at their regularly scheduled meeting on Tuesday, Dec. 14, at 7 p.m.

While several agenda items flew by quickly, one which required long discussion was an unusually large outstanding utility bill for 215 Second Avenue NW for the months of June, July, and August in 2020.

The residence is a rental property owned by Mark Franta and occupied by Winnebago resident Clifton Gray.

The outstanding charge had stood at a whopping $21,303 when it was originally billed. As of Tuesday night’s meeting, Franta still faced a potential bill of $17,545.87 after adjustments.

“According to our policy, only water can be adjusted and not sewer,” said city administrator Jacob Skluzacek. “These adjustments are usually only done once per calendar year, but this address had a previous adjustment done in the spring of 2020. Since it was such an extreme case, I was willing to do another one for calendar year 2020.” 

Skluzacek added, “We will also remove all late fees associated with the bill, since we were waiting for a final determination from Holtmeier’s insurance for over a year.”

He concluded, “The utility committee’s recommendation was to approve the adjustment as shown for a credit of $17,545.87 along with the removal of all late fees. The council can decide whether or not they want to forgive more than what is listed.” 

Mayor Scott Robertson provided additional context regarding what may have caused the property’s spike in water usage.

“Back in April of 2020, that’s when things started going awry,” Robertson began. “A line that came in that basement and was no longer being used had a cap fastened to it, and it blew off.” 

“147,800 gallons went through the meter on that month,” Robertson continued. “It was 851,000 gallons next month.” 

He added, “To me, everybody’s pointing fingers. The real coincidence is that it happened during construction. We’ve chased insurance companies, and nothing’s happened.”

In ensuing discussion, the council weighed the extreme nature of the case against potentially setting too lenient of a precedent regarding utility bill adjustments.

“Thinking through this, this is a $17,000 water bill, with the adjustment. They were originally billed $21,000,” council member Calvin Howard said. “I understand where you have to worry about precedence. But to cite someone $17,000 for a water bill, how are you going to pay that?” 

However, Howard was also concerned as to how such a large leakage was able to go unnoticed.

“To have 800,000 gallons of water go through a house, that’s a lot of water,” he reasoned. “We’re talking four swimming pools worth.”

Franta explained the area in which the leakage was occurring was a small basement crawl space, where no equipment is kept.

He told the council, “I wouldn’t have known about that water. I couldn’t even hear it when I entered the house. I had no idea until I opened the trap door to the basement.” 

Franta continued, “This is a property I’ve owned for about seven and a half years, with no problems like that, and we had two incidents within less than three months.” 

He concluded, “I see that Holtmeier has insurance. I know you’re concerned about citizens having to pay. Holtmeier should pay for that.”

Nonetheless, Franta explained many calls to the insurance company have resulted in no response.

“I wish it had all been dealt with a lot more promptly than this,” council member Tim Hynes responded. “I view it as a construction incident that nobody’s going to take responsibility for.”

Hynes concluded, “My personal opinion is, I would charge those three months for the highest previous usage, and put this behind us because it happened during that construction phase.” 

“You can’t come up with $20,000 water bills and expect people to come up with that,” Hynes added.

Council member Jean Anderson countered, “The construction people won’t pay for it. Mr. Franta doesn’t want to pay for it. Why does the city have to pay for it?”

Anderson suggested, “I think he should have to pay the water bill and half of the sewer, and be glad he doesn’t have to pay $17,000. It might be a little over the top, but I think it’s fair for everybody.” 

This would amount to a credit of approximately $6,000 for Franta.

After more discussion, however, most of the council was leaning toward Hynes’s suggestion.

“The difference is, this is a project that the city promoted and financed, with contractors we entered into a contract with and hired,” Hynes said.

Howard eventually agreed. “I think, for those three months, we should charge him for his highest usage rate from the previous months. Whatever the normal bill was before that.” 

Howard’s motion passed with two assenting votes, and one dissenting vote from Anderson.

“We just need to get it taken care of,” Hynes concluded.

The Winnebago City Council also addressed the following agenda items:

• Set Winnebago’s 2022 property tax levy at $792,298.90, representing a 16.45 percent increase over last year’s levy.

“Hopefully next year, with the changes we’re making, we’ll be in a much better spot,” Skluzacek said.

• Received an update from Minnesota House representative Bjorn Olson.

Olson highlighted his efforts to bring a rural perspective to the House. “My hope for us is we can work together to unshackle your hands a little bit, and make sure we can run cities as best we can,” Olson said.

He also shared updates regarding his work on the transportation committee. Olson is working on an agreement which will reapportion tax money toward small cities via a sales tax on auto parts, rather than a gas tax. Olson hopes to capture three percent of the auto parts tax for small cities.

• Heard an update regarding the NW Street and Utility Improvement Project. Matt Cole, of Bolton & Menk, shared a pay estimate will most likely be ready by next month, at which point the project’s final retainage could be released as well. Currently, $45,000 has been budgeted for the project.

• Several new hires. Roman Madson and Jennifer Quintero were hired as new library assistants at the Muir Library, with starting wages of $10.08 an hour.

Corinna McGinnis was hired as an administrative assistant, with a starting wage of $15.69 an hour.

• Accepting the resignations of Economic Development Authority board member Steve Malchow and Muir Library assistant librarian Rachel Peterson.

• Approving an SIU permit update for Greenfield Global Winnebago LLC, which will now allow the company to discharge 350,000 gallons a day to the city’s wastewater treatment plant, an increase of 100,000 a day compared to the current permit.

• Increasing the fee charged for city usage of Winnebago’s street sweeper from $125 an hour to $175, which will cover the cost of labor and running the equipment, and also allow the city to put away money for a new street sweeper in the future.

• Increasing the septage fee per 1,000 gallons from $50 to $75. The increase was recommended to cover expenses related to treating septage.

• Approving a Minnesota Opioids State-Subdivision Memorandum of Agreement which addresses the allocation of funds from settlements with pharmaceutical companies which were found to have perpetrated the opioid epidemic.

While Winnebago does not qualify to receive funds as an individual city, as it does not meet stipulated population criteria, it will receive a portion of funds allocated to Faribault County as a whole.

• Opening a sealed bid for an empty Winnebago lot. RRR Investments bid $200 for the land, which the council accepted.

• A closed session, during which the council was made aware of the status of pending litigation with TMI Coatings. No action was taken by the council at this time.

• Scheduling a special City Council meeting for Dec. 28 at 7 p.m to discuss ordinances which the utility committee believes need to be updated or amended.