HomeMy WebLinkAboutMinutes - Finance Committee - 03/02/2023 -
Finance Administration
215 N. Mason
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PO Box 580
Fort Collins, CO 80522
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Council Finance Committee Meeting
March 2, 2023
Via Zoom
Council Attendees: Julie Pignataro, Emily Francis, Kelly Ohlson, Shirley Peel
Staff: Kelly DiMartino, Travis Storin, Rupa Venkatesh, John Duval, Teresa, Roche,
Claudia Menendez, Ginny Sawyer, Chad Crager, Blaine Dunn, Jo Cech,
Randy Bailey, Renee Callas, Jen Poznanovic, Gerry Paul, Lawrence Pollack,
Nina Bodenhamer, Malinda Mascarenas, Kendall Minor, Lance Smith,
Gretchen Stanford, Katie Geiger, Mike Calhoon, Victoria Shaw,
Meaghan Overton, SeonAh Kendall, Monica Martinez, Dave Lenz, Kerri Ishmael,
Sheena Freve, Zack Mozer, Tracy Ochsner, Erik Martin, Brian Hergott,
Jeff Rochford, Carolyn Koontz
Others: Kevin Jones, Chamber
Molly Bohannon, Coloradoan
Mark Houdashelt
______________________________________________________________________________
Meeting called to order at 4:00 pm
Approval of minutes from the February 2, 2023, Council Finance Committee Meeting. Emily Francis moved for
approval of the minutes as presented. Kelly Ohlson seconded the motion. Minutes were approved unanimously via
roll call by; Julie Pignataro, Kelly Ohlson and Emily Francis.
A. Utility Billing System Appropriation
Lance Smith, Sr. Director of Finance for Utilities
Gretchen Stanford, Utilities Deputy Director of Customer Connections
EXECUTIVE SUMMARY
An appropriation ordinance is being brought for your consideration from the utility enterprise funds. These
funds are necessary to implement a modern Utility Customer Information System – Customer Self Service Portal
(CIS-CX) Solution. Funds from the enterprise reserves are being requested just as the City completes the
selection of a solution partner and before professional services are contracted. This appropriation request is
necessary to allow the City to secure CIS-CX project management and solution quality assurance services
through go-live, provide legal review of professional services contracts, and provide funding for hiring
contractual staff throughout the implementation.
The total amount being requested for appropriation here is:
Professional QA and Implementation Management $1,500,000
Contract Review and Counsel $100,000
Contractual Implementation Staffing $2,650,000
Total $4,250,000
Once the full solution scope for the new CIS-CX is determined another appropriation, expected to be the last,
will be requested for the direct solution costs including licensing and hardware.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does the Council Finance Committee support bringing an appropriation ordinance forward for the consideration
of the full City Council to support the next phase of the modernization of the Customer Information System –
Customer Self Service Portal?
BACKGROUND/DISCUSSION
Fort Collins Utilities is currently conducting 5 weeks of onsite product demonstrations as the final review of
proposals received for a modern Utility Customer Information System – Customer Self Service Portal (CIS-CX)
Solution. The proposals were received after a deliberate 12-month process focused on identifying solution
requirements, scrutinizing and rating every proposal received, performing reference checks of each solution
provider with other utilities that have implemented the proposed solutions, planning the solution
implementation schedule, staffing needs and quality assurance milestones, and having employees involved in
the solution selection throughout the process and asking questions of the solution providers. This due diligence
and deliberation are necessary to ensure that the selected solution partner and their CIS-CX will serve our
community well as our community moves toward Our Climate Future and evolving how we serve our ratepayers
and enhancing their customer experience with their municipal utilities.
Over the next few months, a solution partner will be selected and then a second appropriation will be presented
to this Committee before the 24-month solution implementation can begin. It is anticipated that the City will
successfully implement the new CIS-CX within 24 months, at which point the existing solution will be retired.
The Capital Improvement Plans presented to the Council Finance Committee ahead of the 2023-24 Budgeting
For Outcomes included up to $15M for this capital investment including the licensing and hardware.
This appropriation is being brought forward at this time to maintain the continuity of the implementation
schedule and to ensure that the pricing reflected in the proposals are current and complete. Momentum for
this implementation is building as staff are getting opportunities to see the benefits of modernizing and
enhancing our customer’s experience as well as focusing on simplifying the architecture and processes behind
the customer interface to provide a stable, upgradable platform.
There are three categories of funding in this next phase of the CIS-CX modernization.
Professional Quality Assurance and Project Management Services
While many existing City employees have worked for decades with the current customer information and billing
system, operating such a system requires a different skill set than upgrading or implementing an existing system
into a new system. The new system may be hosted in the cloud or a more traditional in-house physical solution
with different hardware requirements and interfaces. It may include different modules for a customer portal,
social media, bill printing, etc. To effectively implement these new features and ensure that the City is receiving
the functionality it is expecting, professional software implementation project management and quality
assurance is required.
A scope of work has been developed for these services with a maximum fee through the implementation and
go-live of the new solution. Because most of this work will be done remotely, travel expenses have been
excluded from the not to exceed price for these services. Estimating some travel will be necessary, raises the
amount being requested for these services including travel to $1,500,000.
Contract Review and Counsel
Prior to the City entering into a binding services agreement with the solution provider outside legal counsel may
be sought as needed to ensure the final agreement is in the best interest of the City and ratepayers. It is
requested that an amount of up to $100,000 be appropriated for this purpose.
Contractual Staffing
Many of the City’s employees who work in and with the current customer information system will be involved in
the implementation of the new solution. This is a best practice to ensure that the proposed solution is
consistent with customer expectations and operational requirements. In order to have these employees
available to focus on the implementation, staff will be augmented by contractual staff throughout the
implementation, and post go-live quality assurance and testing. Based on the staffing plan developed for the
solution implementation, the following contractual positions are needed before implementation:
4 Customer Service Providers $288,000 / yr
1 Customer Experience Provider $64,000 / yr
1 Billing & Accounts Receivable Specialist $80,000 / yr
1 Field Service Lead $100,000 / yr
5 Information Technology Solution Providers $575,000 / yr
$1,047,000 / yr
Because having these additional staff will be advantageous throughout the 24-month implementation with
some needed beforehand and some afterward, in total for almost 2.5 years of augmentation it is estimated that
contractual staff may require:
Contractual Staffing Appropriation = $2,650,000
In addition to the contractual staff discussed above who will backfill employees focused on the implementation,
there will be a need for additional staffing for the duration of the project who will focus on leading testing of the
solutions, developing training and training employees, implementing organizational change management,
reviewing existing business processes and developing business analytics for the future solution. As these
additional staff are not needed initially, this staffing need will be a part of the implementation appropriation
once the solution partner is selected.
Appropriation by Enterprise Fund
As the customer information and billing system is needed by each utility to generate monthly operating
revenues, each utility requires such a system and therefore should contribute to the upgrade or replacement of
such a system. While some rates are more complicated than others and some require meter consumption data
to assess, billing for each utility requires much of the same information as any other utility. Because electric
monthly charges are more complicated than flat stormwater rates and unmetered wastewater use, there are
additional billing components for billing electric customers. Hence, it is appropriate to attribute more of the
shared costs to Light & Power. A similar argument applies to Water billing. The annual subscription costs for
this system are divided between the four utilities as follows:
Light & Power 50.0%
Water 25.0%
Wastewater 12.5%
Stormwater 12.5%
This same cost sharing ratio is proposed for the implementation costs.
Light & Power $2,125,000
Water $1,062,500
Wastewater $531,250
Stormwater $531,250
$4,250,000
Enterprise Fund Reserve Balances
The funds being requested herein would come from available reserves of each utility. These funds are above
and beyond funds set aside within the reserves to meet minimum fund balance requirements and any previous
appropriations made but not yet spent. As the table below shows, each enterprise fund has sufficient available
reserves for both anticipated appropriations related to modernizing the CIS-CX solution.
DISCUSSION / NEXT STEPS
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does the Council Finance Committee support bringing an appropriation ordinance forward for the consideration
of the full City Council to support the next phase of the modernization of the Customer Information System –
Customer Self Service Portal?
Emily Francis: are we including Connexion in the billing system?
Lance Smith, no, when the previous effort did not work, we needed an immediate solution for Connexion.
A separate billing system was stood up for Connexion about 1 ½ years ago.
Emily Francis; is there no plan to incorporate all into one billing system?
Light & Power Water Wastewater Stormwater
Available Reserves EOY 2021 $41.4 $41.3 $19.1 $14.5
Mid-year 2022 Appropriations ($26.1)$0.0 $0.0 $0.0
2023-24 BFO Use ($1.0)($29.3)($7.7)($2.3)
2022 Revenues Above Budget $11.2 $3.5 $1.2 $0.2
2022 Expenses Below Budget $1.9 $7.4 $1.8 $2.2
Estimated Available Reserves $27.4 $22.9 $14.4 $14.6
Amount Being Requested ($2.1)($1.1)($0.5)($0.5)
Remaining Available Reserves ($M)$25.3 $21.8 $13.9 $14.1
Lance Smith; the real challenge there is that the vendors who built systems for traditional utilities have not
gotten into the broadband space so there are really not many solutions that would incorporate broadband as
well.
Travis Storin; also, although the backend systems probably don’t exist to support the market in the way we
would hope right now, there are opportunities to have a more streamlined customer facing experience and
there are platforms that can merge bills for presentation purposes and still be processed by staff separately on
the backend so a utilities customer who also has Connexion could be presented with one bill. That is further
down the road and is carries some level of inefficiencies by virtue of operating the two billing systems on the
back end. But if the spirit of your question is around the customer experience, there are some alternative ways
we could be approaching that and examining that in the future.
Julie Pignataro; can you talk a bit about lessons learned from the previous experience that are feeding into this
process?
Lance Smith; the previous experience was not successful and so the first lesson is that we were trying to manage
an implementation of a software system in house and in house we don’t have that expertise – the first thing we
did was procure outside expertise and project management– test things along the way – confirm all works – we
tried to do this w/out adding an contractual staffing – make sure this implementation goes well – we can’t ask
people to do that – we are bringing resources in to backfill so these folks can focus on this – we are asking
outside council to review the contract to make sure it is very clear and tight
Gretchen Stanford; the requirements are such an important piece of that – making sure that we are all on the
same page about what those requirements are and that QA piece will be very important as well.
Julie Pignataro; so, we don’t know who we are going with yet. How much is our IT team involved in this choice
because of their expertise?
Lance Smith; so, this is not for an RFP. We issued that earlier this year. Before we did that, we brought on a
professional management team who helped us write the requirements so we could issue the RFP. We reduced
the number of proposals we received down to five who we are bringing in for this week long demo. Each vendor
is spending a week here on -site to demonstrate how their system works. We have a team who will be scoring
them as they go through this process. The team consists of folks from customer service, billing, metering, rates
as well as a large contingent from IT. Collectively, this team is going to score the proposals then we will have
our chosen vendor and then will be working with them to negotiate the contract as to exactly what is going to
be provided. The first thing will be determining if it will be a hosted system or inhouse and that will determine
some of the cost. IT is intimately involved and half of the staffing we are asking for is IT.
Julie Pignataro; I had heard that everyone thought the previous (failed) project would be ready to go out of the
box.
Travis Storin; it was sold as an off the shelf solution.
Lance Smith; it was and one of the things we are doing with these demos is – one criteria said that we aren’t
going to look at your solution unless it has already been deployed in a market with 100K plus customers.
They are going to show us their product, step us through so we can make sure it does what they say it does.
Previously we were told it was an off the shelf solution and then we realized no it was not. That was one of the
big lessons learned. So, making sure the product is real is key. We will also be doing reference checks with other
utilities who have implemented their solutions to make sure it did what they were told and the implementation
timing was accurate.
Travis Storin; Julie, if you have more in-depth questions, we may need to have an Executive Session because of
the ongoing litigation we are involved in.
Julie Pignataro; let’s put that on the shelf for now and keep us updated.
Kelly Ohlson; I see $13-18M for a new billing system. Is that number close to what we expected as it seems like
a ‘take your breath away’ number
Lance Smith; it is in the ballpark and there is a pretty wide range $9-14M. That depends on what type of
solution we go with, whether it is In house, running on our computers with our IT doing the trouble shooting or
it could be on a hosted platform, they run it on their servers. The hosted solution option is the solution we are
leaning toward. Our current billing system is about 20 years old, so we haven’t done this in 20 years. The
hosted solution would include regular updates 2-3 times per year so we would constantly be upgraded to the
current version of the software. We don’t want to have a highly customized system. We want something as
close to off the shelf as possible. When I came and talked to you about the debt forecast I was assuming
$12M
Kelly Ohlson; so, to confirm today we are talking about $4.2M.
Lance Smith; yes, that is correct – the total range is $13-18M
Result; The Committee approved this to go forward to the full Council on March 21st.
B. Connexion – Capital Management
Blaine Dunn, Director, Accounting
Chad Crager, Broadband Executive Director
EXECUTIVE SUMMARY
The purpose of this item is to provide Council Finance Committee an update on Connexion’s financial
projections, highlight the timing of liquidity needs, and discuss a proposed resolution that will enable flexibility
in the usage of funds to be raised in the fall of 2023 from a planned bond offering in combination with Light &
Power.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does Council Finance Committee support the recommendation to bring forward a resolution to Council to
reimburse Connexion for expenditures through a future bond offering?
BACKGROUND/DISCUSSION
Both Light and Power and Connexion anticipate needing to borrow money through bond offerings in 2023. The
projects for Light and Power and Connexion each have different timelines, so it is expected expenditures for
Connexion will occur before the issuance of additional bonds, and exhaust currently available funds.
Reimbursement of expenditures with bond proceeds is allowed for soft costs. However, in order to reimburse
expenditures incurred for capital costs, an official declaration by Council must be made.
Therefore, in order for the City to be able to use the proceeds from the issuance to reimburse Connexion for any
expenditures, and at the same time maintain the tax-exempt status of the bonds, the Internal Revenue Service
(Treasury Regulation 26 C.F.R. §1.150-2) requires the City Council adopt a Resolution. The Resolution represents
the City’s declared official intent to reimburse the applicable City funds for such expenditures with the proceeds
from the issuance of the bonds.
The declaration of official intent through the Resolution complies with federal regulations. It also provides more
flexibility to the City so it can better manage the capital expenditures related to the Projects. With a Resolution,
the City can make the capital expenditure prior to issuing the bonds and later reimburse the applicable City fund
with the proceeds from the issuance of the bonds.
FINANCIAL IMPACTS
Staff presented updated financial projections for Connexion at the January 10, 2023, Work Session. In that
meeting, the capital project estimate was updated, reflecting a need to access approximately $16 million
additional capital to complete the network build-out and customer ramp-up by the end of 2024. An additional
$3 – $5 million for excess operating expenses was also estimated to be needed.
These estimates remain unchanged. The table below highlights the original Business Plan capital assumptions,
approved spending updates, project spending to date and the current project estimate.
Connexion’s maximum funding need is expected by December 2024, with 2025 expected to be breakeven before
the generation of excess cashflows that will be able to service the L&P reserve usage payback plus new bonding
commitments. To date, Connexion has issued $129.6 million of the $150 million voter approved amount to
support Connexion’s build. This leaves over $20 million available for additional funding needs.
Connexion is contemplating the issuance of new bonds totaling approximately $20 million (in a combined
offering with Light & Power’s approximately $40 million requirement). Highlighted below is the current
estimate of the projected inflows and outflows for Connexion for the balance of 2023 and full year 2024 (with
the assumption of completion of new bonding in the September / October timeframe.)
DISCUSSION / NEXT STEPS
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does Council Finance Committee support the recommendation to bring forward a resolution to Council to
reimburse Connexion for expenditures through a future bond offering?
Kelly Ohlson; it says Connexion knows there will be a need for future capital of $20M
$16M capital and $4M for operations
(see slide below)
Blaine Dunn; capital can be used in two different senses; capital can mean cash. The $16M for capital covers
expenditures for fixed assets being put into the ground. Fixed assets – the $4M is the soft costs which include
personnel, marketing, etc.
Julie Pignataro; this is hard because this comes back to us a lot - but my answer is yes.
I know we have a new team and more information, but it is very difficult. I just have to acknowledge this is hard
to read. I do know you are being very transparent and that is super helpful. Constant updates are helpful.
Emily Francis; did we already discuss the $40M in Light & Power that we are bonding?
Blaine Dunn; we have not, that is scheduled to come back to this committee in the June timeframe. Lance is still
solidifying some of the final numbers.
Travis Storin; we have not talked directly about the financing, however, it is part and parcel to the long term
capital plan that Utilities updates every 2 years. I believe we talked about Light & Power in December. It is
implicit in the cost numbers that we would go for approximately $40M.
Blaine Dunn; when Light & Power came to Council Finance the last time, that was the number that was in their
presentation.
Emily Francis; yes, a hard yes but yes
Result; The Council Finance Committee approves this to go forward with a resolution to Council to reimburse
Connexion for expenditures through a future bond offering.
C. Annual Reappropriation Ordinance
Lawrence Pollack, Budget Director
EXECUTIVE SUMMARY
The purpose of this item is to reappropriate monies in 2023 that were previously authorized by City Council for
expenditures in 2022 for various purposes. The authorized expenditures were not spent or could not be
encumbered in 2022 because:
• There was not sufficient time to complete bidding in 2022 and therefore, there was no known vendor or
binding contract as required to expend or encumber the monies; or
• The project for which the dollars were originally appropriated by Council could not be completed during
2022 and reappropriation of those dollars is necessary for completion of the project in 2023.
Additionally, there may have been sufficient unspent dollars previously appropriated in 2022 to carry on
programs, services, and facility improvements in 2023 for those specific purposes.
In the above circumstances, the unexpended and/or unencumbered monies lapsed into individual fund balances
at the end of 2022 and reflect no change in Council policies.
Monies reappropriated for each City fund by this Ordinance are as follows:
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does the Council Finance Committee support moving forward with the 2023 Reappropriation Ordinance on the
Consent Agenda at the March 21, 2023, Council meeting?
BACKGROUND/DISCUSSION
The Executive Team has reviewed the Reappropriation requests to ensure alignment with organization
priorities and the Budget staff reviewed the requests to verify that all met qualification requirements. The
2023 Reappropriation requests are as follows, by fund:
GENERAL FUND
Police Services
1) K9 Vests - $3,520
Purpose for funds: $3,520 was donated by a resident for the purpose of buying a protective vest for a K9.
This has not yet been purchased and should be reappropriated according to the intent of the gift.
Reason funds not expensed in 2022: The reason that the gift was not expended in 2022 was because the
dog that it was intended for needed to be returned to the breeder because of behavioral issues. Another K9
has been purchased and the vest will be purchased later in the year when the dog is full grown.
2) Northern Colorado Regional Communication Network (NCRCN) - $300,000
Purpose for funds: The funds are being drawn from NCRCN (Northern Colorado Regional Communication
Network) reserves, a restricted portion of the General Fund. These funds were designated for the
maintenance and replacement of the radio towers and equipment on top of the hospital and on Tower Road
by Horsetooth Rock.
Reason funds not expensed in 2022: Because of the complexity of the scope of the project, and conflicting
priorities with other projects, the Information Services Division in Police Services is still in the process of
developing the RFP to bid out the work. This project will commence in 2023.
City Manager’s Office
3) Council High Performing Board - $18,295
Purpose for funds: The previous City Council approved an offer for $30,000 to support Council group and
individual development. Strategies such as individual mentors/coaches and conferences are available with
General Fund $602,754
Transit Fund 55,750
Transportation Fund 100,000
Water Fund 52,500
Broadband Fund 4,361,774
Data & Communications Fund 86,000
UT Customer Service & Administration Fund 170,848
Total $5,429,626
this funding. It can also be used for other training purposes, as well as participation with associations such
as the Colorado Municipal League, National League of Cities, and Water Literate Leaders.
Reason funds not expensed in 2022: A portion of this funding was used in 2022; however, City Council did
not fully utilize the available budget. A Council workshop in January of this year outlined further training
and development needs for Council in 2023. These funds will be used towards those additional
opportunities.
4) DEI Principles of Community - $8,000
Purpose for funds: A key deliverable identified by Council to advance the Equity and Inclusion priority was
to develop Principles of Community for the organization to foster and enhance a sense of belonging for
coworkers and the community we serve. This funding will create the principles of community which
developed as a mission, vision, values refresh project. Work was partially completed in Q4 of 2022 after
extensive staff engagement. The Communications Department is working on creating a new poster and
communications to be shared city-wide in 2023.
Reason funds not expensed in 2022: Not all funds were expenses in 2022 as the city-wide roll out of the
new Mission, Vision and Values (MVV) was planned for Q2 2023. Messaging and development of the
outreach materials is still in progress and expected to be completed and ready for outreach by the end of
Q2. These funds will be used to pay for the final printing of materials and promoting the new MVV across all
departments in 2023.
5) Land Acknowledgement Funding - $16,065
Purpose for funds: Land Acknowledgement funds have been used to build trust with the Fort Collins Native
American community in a land-focused way. Having a strong relationship with a foundation of trust is a
crucial first step before we can begin the process of creating a written land acknowledgement. For example,
funds have been used to provide space for the Northern Colorado Intertribal Powwow Association (NCIPA)
Powwow, space and supplies for NCIPA culture classes, and space and supplies for the NCIPA winter drive
celebration.
Reason funds not expensed in 2022: It was crucial to establish a strong relationship of trust and reciprocity
before beginning the process of creating a land acknowledgment. There was some hesitancy in the Native
American community about creating a land acknowledgment without understanding the City’s commitment
to the Native community, to ensure that the land acknowledgment was not merely a performative action.
Over the last year, we have established that relationship and we now have a solid basis to create a written
land acknowledgement in 2023. Quarterly meetings have been set up with the Native American community
for 2023, and we are also establishing a Native American Advisory Circle this year. These spaces will be the
mechanism through which the land acknowledgment is created.
Parks
6) Park Planning & Development Special Project Support - $5,600
Purpose for funds: Special project support funding was appropriated in 2020 for Park Planning &
Development staff to conduct site planning and prepare cost estimates for potential donor funded projects,
enabling donors to move forward with fundraising efforts. To date, multiple projects have been completed
utilizing this funding source, including Veteran's Plaza improvements, Eastside Park improvements, Sugar
Beet Park art "The Hand that Feeds", a cyclo-cross training course in Rossborough Park, site planning for a
pickleball complex, and a pledge from the mountain bike community to fund a feasibility study for a bike
park as part of a GOCO grant.
Reason funds not expensed in 2022: Funding partnerships with potential donors are unpredictable. This
funding enables the City to be responsive to potential donors when fundraising opportunities arise. The
remaining funds will be used to complete projects currently underway.
Community Development & Neighborhood Services
7) Mediation and Restorative Justice Services - $4,526
Purpose for funds: These funds were all donations made to support the Mediation and Restorative Justice
programs. The programs were founded 22 years ago and provide community-based services to support
residents in constructively facing conflict. Community Mediation is used to address all types of conflicts and
supports citizens in resolving conflicts collaboratively. Youth (10-22) in our community can be referred to the
Restorative Justice programs to take responsibility for, and help repair the harm of, crimes they have
committed. Our team of over 50 trained volunteers makes these services free or low-cost and available for
our community.
Planned uses for these donated funds include additional training and conferences for staff and volunteers;
diversifying the Mediation and RJ volunteer pool; funding the RePay program where youth in the RJ
programs who owe victim restitution can do community service to help pay the restitution.
Reason funds not expensed in 2022: In January 2022, two of the 4-person MRJ team left the organization so
efforts were focused on maintaining core services, rather than pursuing special projects. New staff were
hired in May 2022 and training, onboarding continued throughout much of the rest of the year. It is
expected that these funds will be expended in 2023.
Social Sustainability
8) EV Credits - $238,000
Purpose for funds: These funds address the cost differential between current Colorado Housing and Finance
Authority requirements and the updated Building Code requirements for Electric Vehicle (EV) infrastructure
for affordable developments. The program provides cost-sharing of these additional infrastructure
requirements by providing credits of flat fees calculated per project based on eligible parking spaces.
Reason funds not expensed in 2022: The City did not receive any requests for EV infrastructure credits from
qualifying projects in 2022. The parking standards in the Building Code that will be in place starting 2023 will
allow all affordable housing projects to qualify for this credit. Staff expects the first request for a credit to be
submitted Q1 2023.
Natural Areas
9) West Nile Virus - $8,748
Purpose for funds: The West Nile Virus Program provides proactive mosquito management and seeks to
reduce the risk of human contraction of West Nile Virus. The majority of the monies fund two contracts; a
contract with Vector Disease Control International provides mosquito larvae control and mosquito trapping,
while a second contract with Colorado State University provides for testing West Nile Virus presence. The
remaining funds provide for community education through various forms of advertisement and outreach.
Reason funds not expensed in 2022: During the budget process of 2023-2024 full funding for the WNV
Program was not restored, yet looking ahead, it became clear that the inflation-related contract costs for
the fundamental, contracted elements of the program would significantly exceed the budgeted increase for
2023 and 2024. To plan for this short-fall, remaining outreach funds (approximately $5000) were coupled
with unanticipated reimbursement money from the Town of Berthoud (approximately $3000) not spent
with the intention to carry them over to address the 8% increase in contractor costs. Without carrying these
funds forward, the contracted elements of the program are likely to exceed the total program budget by
roughly $2000.
TRANSIT FUND
Transfort/Dial-A-Ride
10) Poudre School District (PSD) & Transfort Collaboration Study - $55,750
Purpose for funds: This funding allows for a study to determine areas of better collaboration for student
transportation between Transfort and Poudre School District (PSD).
Reason funds not expensed in 2022: Staffing issues, contractor availability, as well as purchasing
department capacity led to delays for this project until late November 2022. Staff currently has all of the
work in place to sign a contract and begin work as soon as 2023 funding is confirmed. Multiple staff will be
actively monitoring and guiding this work in 2023.
TRANSPORTATION FUND
Traffic
11) Neighborhood Traffic Mitigation Program Project Construction - $100,000
Purpose for funds: Traffic in neighborhoods can affect the quality of life for residents, bicycles, pedestrians
and drivers. The Neighborhood Traffic Mitigation Program is a collaborative effort between neighborhoods
and City staff to implement traffic calming options. In 2022, Traffic received $130,000 additional funding for
medians and/or pedestrian refuge islands, sidewalk curb extensions and traffic diverters in order to achieve
a more "complete streets" approach to traffic calming. The offer included funding for professional
(consulting) services and funding for the construction of traffic mitigation devices on neighborhood streets.
Traffic is requesting $100,000 to be re-appropriated from the 2022 budget to construct these mitigation
improvements.
Reason funds not expensed in 2022: In 2022, evaluation of locations and public outreach was completed.
Due to staffing changes and consultant availability, design of the mitigation improvements for Whedbee and
Oak was not started until fall. Survey and design will be completed in the Spring of 2023 and the
construction will start in the summer/fall.
WATER FUND
Utility Water Resources Division
12) Northern Integrated Supply Project (NISP) Response & Engagement - $52,500
Purpose for funds: Since 2008, the City has developed and contributed science-based input to the various
planning stages of the Northern Integrated Supply Project (NISP) project with the goal of minimizing adverse
impacts on the Poudre River and the Fort Collins community. The City’s efforts have resulted in positive
changes to this project which are reflected in the NISP operations and mitigation plan. Funding from this
2022 offer is intended to provide technical consulting and engineering support to inform the City’s
engagement in future NISP planning efforts. Specifically, City staff will engage in NISP adaptive management
and master planning stakeholder processes; however, additional technical and consulting support will be
needed to achieve the desired outcomes. Funds from this offer would support: 1) water resources
engineering and analysis to advise the NISP flow operations and ensure the proposed flow mitigation
program is realized; 2) advisement for the development of NISP’s proposed Master Plan and Adaptive
Management Program; and 3) additional discipline-specific representation on technical advisory groups and
input for project infrastructure proposed within the City limits.
Reason funds not expensed in 2022: The NISP project Record of Decision (ROD) was not issued until late
2022, which was later than NISP project participants anticipated. Because of this permitting delay and
because staff at Northern Water were heavily involved in post-fire recovery from the 2020 East
Troublesome Fire, Northern Water elected to postpone the Adaptive Management and River Master
Planning discussions with stakeholders until after the ROD was released. Northern Water initiated
conversations with potential project stakeholders, including City of Fort Collins, about the intended start of
these planning efforts in early 2023. Funds from this budget offer will be used for the original intended
purpose of developing science-based input with the assistance from technical and engineering consultants,
on how the NISP project impacts should be managed, mitigated and monitored.
BROADBAND FUND
Broadband
13) Re-Deploy of Broadband Working Capital - $4,361,774
Purpose for funds: Offer 63.1 encompassed the ramp up of Connexion core operations as the network build
out was expected to be essentially complete by year-end 2022, and customer acquisition, servicing and
network maintenance approached full targeted operating levels. This offer was for all 2022 ongoing
expenditures which include personnel, operating costs, cost of goods sold (primarily internet and video
content) and debt servicing requirements. This request seeks to reappropriate $4.4 million in unspent 2022
funds into 2023 for completion of the primary network buildout, access to customer premises and
continued customer installations.
Reason funds not expensed in 2022: Construction of the network, accessing commercial and residential
multiple dwelling unit (MDU) accounts, and ramp-up of customer base has taken longer than expected due
to supply chain cost increases, build-out complexity and installation labor shortage issues. These conditions
have required appropriation of additional capital expenditures for the project by City Council in September
2021 and April 2022 totaling $28 million. An additional $5.4 million in unanticipated working capital savings
(primarily from operating cost containment and interest income from the original bond proceeds) was
reserved and targeted for re-deployment as part of the updated financing efforts. $1.0 million of this
amount was spent in 2022 on network buildout. This request seeks to reappropriate the remaining $4.4
million from the $5.4 million re-deployed amount to meet the increased capital requirements. This does not
represent an increase in the capital budget estimate, just the formal transfer of reserved funds.
DATA AND COMMUNICATIONS FUND
Information Technology
14) Staff Augmentation for Network and Voice Operational Support - $86,000
Purpose for funds: This request will fund additional hardware support and staff augmentation for Network
and Voice support that will assist with the Webex rollout, voice enterprise support, Police Wi-Fi upgrades,
and other enterprise network tasks and demands. These funds will allow the Information Technology (IT)
department to contract with an experienced vendor to help manage operational and project workload. This
will also allow time for IT to hire new Network/Voice personnel and get them up to speed, while not losing
traction on enterprise support needs, project rollouts, and maintaining a proper work-life balance with an
already overextended Network staff.
Reason funds not expensed in 2022: These funds were not expensed due to workload capacity, vacant
positions, and expertise issues in the midst of the transition of Network and Voice operations between
Connexion and the IT department that occurred in mid-2022. Upon transferring ownership of the Network
and Voice operations, IT began evaluation of the current status of the operation and prioritized what
needed most attention, which was delayed lifecycle switch replacement, ARPA-funded initiatives, and voice
strategy which pushed the aforementioned initiatives and operational tasks to late 2022 and into 2023. IT
has evaluated, rescoped, and is currently posting the vacant Network positions to better address the needs
of the City's Network and Voice systems to keep up with service needs, project demands, upgrades, and
expansion.
UTILITY CUSTOMER SERVICE AND ADMINSTRATION FUND
Utility Technology and Customer Service
15) Utilities Information Technology Minor Capital - $170,848
Purpose for funds: The funds are requested for replacement of departmental firewalls for 1) the Customer
Information System (CIS) Utility billing system hosted onsite at Platte River Power Authority (PRPA) and 2)
the Utilities Advanced Meter Fort Collins (AMFC) system. The firewalls are currently end-of-life, and thus
end-of-support, and need to be replaced.
Reason funds not expensed in 2022: The downside to the departmental firewalls is that they are discrete
stand-alone installations built as a pair for redundancy. The number of these types of discrete firewall
installs across the City creates a large management burden, as well as a large and potentially inefficient use
of funds. IT was exploring a new concept in which these disparate firewalls could be combined into a single
on-premise redundant virtual environment with the expectation that the new environment would be easier
to manage, provide better redundancy, and ultimately be a more cost-effective solution. However, due to
other work priorities, the research and analysis into this proposal was not able to be completed in 2022.
The research into this new firewall architecture should be completed in 2023, and the funds for these
firewalls could be applied towards this new firewall architecture. If the new firewall architecture proves to
be unfeasible, the funds would still need to be applied to the purchase of discrete firewalls.
FINANCIAL/ECONOMIC IMPACT This Ordinance increases 2023 appropriations by $5,429,626. A total of
$602,754 is requested for reappropriation from the General Fund, $4,361,774 is requested from the Broadband
Fund, and $465,098 from other funds. Reappropriation requests represent amounts budgeted in 2022 that could
not be encumbered at year-end. The appropriations are from prior year reserves.
DISCUSSION / NEXT STEPS
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does the Council Finance Committee support moving forward with the 2023 Reappropriation Ordinance on the
Consent Agenda at the March 21, 2023 Council meeting?
Kelly Ohlson; a pervious Council decided that West Nile Virus was a community issue and not a Natural Areas
issue and the funding was taken from Natural Areas and put into the General Fund. Now I see it back under
Natural Areas.
Lawrence Pollack; you are correct that the funding is coming from the General Fund not Natural Areas.
But it is managed and the budget is run through Natural Areas.
Emily Francis; no questions
Julie Pignataro; no questions – Thank you for the great explanations in the packet.
RESULT; The Council Finance Committee supports moving forward with the 2023 Reappropriation Ordinance on
the Consent Agenda at the March 21, 2023 Council meeting.
OTHER BUSINESS;
Julie Pignataro; because of the number and nature of the agenda items, does it make sense to do the April 6th
meeting in person? We do good work this way – this is a robust agenda and this will be the 5th or 6th time we are
talking about how we plan to package our funding shortfalls.
Travis Storin; one of the agenda items for the April 6th meeting is Sustainable Revenue Climate and a separate
topic regarding our approach to the ballot. Large emitter will be incorporated into that dialog. We will be
brining the results of our analysis around the large emitter tax as opposed to a fee. We are at an actionable
time as it relates to November ballots. We added more time to allow for that dialog.
It was agreed to have the April 6th Council Finance Committee meeting be a hybrid meeting.
Meeting Adjourned at 5:10 pm
APPROVED BY THE FINANCE COMMITTEE ON APRIL 6, 2023