HomeMy WebLinkAboutAgenda - Full - Finance Committee - 03/02/2023 -Finance Administration
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AGENDA
Council Finance & Audit Committee
March 2, 2023
4:00 - 6:00 pm
Zoom Meeting https://zoom.us/j/8140111859
Approval of Minutes from the February 2, 2023, Council Finance Committee meeting.
1.Utility Billing System Appropriation G. Stanford
L. Smith
Presentation: 20 mins.
Discussion: 20 mins.
2. Connexion - Capital Management B. Dunn
C. Crager
Presentation: 10 mins.
Discussion: 20 mins.
3. Annual Reappropriation Ordinance L. Pollack
Presentation: 10 mins.
Discussion: 10 mins.
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Council Finance Committee
2023 Agenda Planning Calendar
RVSD 2/21/23 ck
March 2nd 2023
Utility Billing System Appropriation 40 min G. Stanford
L. Smith
Connexion – Capital Management 30 min B. Dunn
Annual Reappropriation Ordinance 20 min L. Pollack
April 6th 2023
Sustainable Revenue - Climate H. Depew
Sustainable Revenue - Approach to Ballot G. Sawyer
T. Storin
Potential County Childcare Tax TBD
West Elizabeth Appropriation Request M. Martinez
May 4th 2023
Auditor RFP Process 30 min B. Dunn
Encampment Clean-up 20 min R. Venkatesh
M. Yoder
June 1st 2023
Sustainable Timberline Recycling Center TBD M. Saylor
August 7th or August 16th (in person - 4-7:30 pm)
Auditor Interviews (B. Dunn)
September 7th
Annual Adjustment Ordinance (20 mins. L. Pollack)
2024 Budget Revisions (45 mins. L. Pollack
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Finance Administration
215 N. Mason
2nd Floor
PO Box 580
Fort Collins, CO 80522
970.221.6788
970.221.6782 - fax
fcgov.com
Council Finance Committee Meeting
February 2, 2023
Via Zoom
Council Attendees: Julie Pignataro, Emily Francis, Kelly Ohlson, Shirley Peel
Staff: Kelly DiMartino, Travis Storin, Tyler Marr, John Duval, Teresa, Roche,
Terri Runyan, Ginny Sawyer, Sylvia Tatman-Burruss, Megan Valliere,
Jen Poznanovic, Nina Bodenhamer, Blaine Dunn, Jo Cech, Randy Bailey,
Renee Reeves, Gerry Paul, Lawrence Pollack, Dave Lenz, Sheena Freve,
Josh Birks, Javier Echeverria Diaz ,Rachel Rogers, Linsday, Ex, Caroline Mitchell,
Beth Rosen, Kira Beckham, Honore Depew, Dean Klingner, Victoria Shaw,
Mike Calhoon, LeAnn Williams, Aaron Harris, Monica Martinez, Ian Smith,
Kaley Zeisel, Drew Brooks Dave Lenz, Kerri Ishmael, Sheena Freve, Zack Mozer,
Tracy Ochsner, Erik Martin, Brian Hergott, Jeff Rochford, Carolyn Koontz
Others: Jason Licon, Airport Director
Wade Troxell
Kirk Scramstad, Mark Houdashelt
Pat Ferrier, Coloradoan
______________________________________________________________________________
Meeting called to order at 4:00 pm
Approval of minutes from the January 5, 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. Sustainable Revenue / CCIP
Ginny Sawyer, Sr. Project Manager
Jen Poznanovic, Sr. Revenue Manager
EXECUTIVE SUMMARY
The purpose of this item is to seek Council Finance Committee direction on timing and what, if any, item(s) to
consider for referral to the November 2023 ballot.
Should CFC recommend bringing a revenue option in November 2023, staff suggests focusing on an additional
tax on marijuana, alcohol, and tobacco. Revenue from this option is estimated at an amount that could cover
the existing Parks and Recreation gap that focuses on maintaining current assets and infrastructure.
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Also of note, staff is currently focusing on a November 2024 election to bring forward the Street Maintenance
renewal and the Community Capital Renewal.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance support bringing a revenue question to the voters in November 2023?
2. If yes, what type of revenue increase option does Council Finance recommend?
3. Does Council Finance support pursuing the two ¼ cent renewals in November 2024?
BACKGROUND/DISCUSSION
Over the past several years, masterplan developments and updates have identified clear funding needs in the
areas of parks and recreation, transit, and housing. Along with these needs the criticality of advancing City
climate action goals has also been identified as an area of need. Original estimated annual shortfalls ranged
from six to twelve million per area.
When conversations were first initiated, funding needs included:
• Parks & Recreation - $8 to $12M annual shortfall (Parks & Recreation Master Plan)
• Transit - $8M to $10M annual shortfall (Transit Master Plan)
• Housing - $8M to $9.5M annual shortfall (Housing Strategic Plan)
• Climate - $6M+ annual shortfall (Our Climate Future Plan)
Throughout 2022, staff has worked with the Council Finance Committee (CFC) to refine and better articulate the
needs and what additional funding would accomplish. CFC discussions have also focused on potential funding
mechanisms and the impacts and implications of various strategies.
Discussions and feedback to date have highlighted a desire to:
• Clearly define and articulate revenue needs and level of service considerations.
• Thoroughly research funding options including impacts and the context of existing and potential new tax
measures (local and regionally.)
• Work to keep overall resident impact and tax burden as low as possible.
• Consider existing dedicated tax renewals and associated election timelines in a strategic manner.
These considerations were also supported by the full Council at the April 12, 2022, work session.
Funding Gaps
Since April, staff has engaged with CFC in June, September, and November to clarify funding needs. These efforts
have resulted in updates to the funding gaps (see below) and more focused funding strategies.
• Transit from $8-$10 to $14.7M
• Climate from $6M to $9.5M
With total annual shortfalls ranging from $30-$40 million discussions have focused on understanding priorities in
each area and how additional money would be spent.
Parks and Recreation needs are in operations and maintenance and infrastructure replacement. Additional
funding is needed to maintain existing assets and to stay current with community needs and trends.
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Transit funding needs have been identified to build out the transit system to the 2040 vision. Shorter term
needs would focus on capital investments and increased frequencies. Longer term funding would focus on local
grant matches for larger projects.
Fort Collins Housing goals call for increasing affordable housing stock to 10% total. Additional funding could be
utilized in a variety of ways including expanding the competitive funding process and/or expanding and initiating
City-led efforts.
The Climate Action focus would be on reduction strategies identified in Our Climate Future Big Moves.
Through discussion and analysis at CFC and Council work sessions, sales tax, property tax and excise/additional
sales taxes have emerged as the most feasible mechanisms. The table below demonstrates the potential
revenue gain along with estimated annual impact to residents. Capital expansion fees are listed and is
something staff will pursue during the Fee Study in 2023.
Sales Tax: Sales tax has been the most traditional revenue source for the City. Our base rate is currently 2.85%.
There are four dedicated ¼ cent taxes. These taxes are paid on any purchase made within the city. Requires
voter approval. (Groceries taxed at 2.25%).
Property Tax: Since 1992, the City has collected 9.797 mils of property tax which equates to 10.5% of a Fort
Collins property owners total annual property tax. Below is the breakdown of what a Fort Collins property owner
pays in property tax.
Poudre Fire Authority gets 67% of the City’s portion (approx. 6 of the City’s 9 mills) of property tax amount
through an intergovernmental agreement. Requires voter approval.
Additional Sales Tax: An additional sales tax is an additional sales tax on the purchase price to the end
customer. For consideration in these discussions, staff has estimated additional tax revenue using an additional
3% and 5% tax on marijuana, alcohol and tobacco.
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Numerous other municipalities across Colorado have an additional tax on marijuana and have not experienced
negative impacts. Police Services has found that “gray/black” market marijuana activity in Fort Colins is focused
on transport out of state, not on sales and availability to residents or minors. Police Services is reporting an
uptick in underage sales of tobacco.
An additional sales tax would require voter approval.
Excise Tax: An excise tax is a tax on specifics goods or services paid by the businesses. Fort Collins currently has a
liquor occupation excise tax.
Staff is also researching excise tax mechanisms to generate revenue and change behavior in natural gas use.
Staff plans to discuss a natural gas excise tax and a large emitter tax with Council Finance Committee in May of
2023.
Any excise tax would require voter approval.
Funding Scenarios
Achieving additional funding will likely be a phased effort that lessens the funding gaps incrementally over time.
Knowing this, and through CFC conversations, demonstration scenarios target pursuing new revenue in a $25M
range.
The scenarios presented are not intended to be final or recommended options. They are intended to
demonstrate the flexibility and variable means and ways to add additional revenue to cover the identified gaps.
The two scenarios include anticipated impacts to a household of three and range from $156 annually to $107
annually. The models focus on property tax, sales tax, and excise tax.
Staff has also calculated the impact to 3-person households at both 50 and 80% AMI and found the lowest
impact to be 0.14% of total annual income to 0.32% at the high end.
Scenario A: 4.1% sales tax/estimated $156 annual cost to a 3-person household.
*Assumes a family of three
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Scenario B: 3.85% sales tax (no increase). Higher property tax and impact to homeowners.
Follow up on Taxes and State Sharebacks from December Council Work Session:
Below are the current total retail sales tax rates on alcohol, tobacco, and marijuana in Fort Collins:
The City has a liquor occupation excise tax and had two state sharebacks until June 2022. The City receives a
monthly state marijuana tax shareback and opted out of the tobacco tax shareback in June 2022. Previously the
city exempted tax on cigarettes but now taxes cigarettes at the City’s 3.85% rate.
*This tax is paid by the business annually based on the type of alcohol served
**The City opted out in June 2022
Election Timeline Considerations
Per the recent ballot initiative, City elections will now be in November. Ballot referral would likely need to
happen in August.
Tabor initiatives cannot be considered during special elections.
Street Maintenance and Community Capital Taxes expire December 31, 2025. November 2024 and November
2025 are two opportunities for renewal.
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GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance support bringing a revenue question to the voters in November 2023?
2. If yes, what type of revenue increase option does Council Finance recommend?
3. Does Council Finance support pursuing the two ¼ cent renewals in November 2024?
DISCUSSION / NEXT STEPS
Emily Francis; why are the amounts different on $100 if they are all 5%
(see slide 10 and 7 below)
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Travis Storin; you are correct – numbers were transposed between slides 7 and 10(see above0
Emily Francis; would the new proposed alcohol sales tax apply to grocery stores as well?
Ginny Sawyer: we could do that in grocery stores easily
Emily Franci; does our Transit funding include multimodol?
Travis Storin; I don’t believe so – this has been focused around bus rapid transit – fixed route network.
Drew Brooks; what we have been proposing so far in the transit discussion has only been around transit itself
(buses) and bus service. There are some aspects of that buildout of the Transit Master Plan that would result in
some active modes improvements, for instance the West Elizabeth corridor is a full rebuild of that corridor that
would include protected bike lanes and improvements to sidewalks
ACTION ITEM:
Emily Francis; great clarification – thank you. Do we know what the gap in funding is for our Active Modes Plan?
Drew Brooks will get that information to Emly as a follow-up
Emily Francis; if we did another capital improvement tax - what projects would be in there?
Ginny Sawyer; that is part of the reason we are looking at November 2024, we definitely need some time to
develop that. Certainly some things that we would consider traditional; a lot are transit related, bike /
pedestrian related. We also try to get some amenities in there. We have started pulling a team together
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internally to start shaping at a high level (a community choice and Council choice), but at least getting some of
the options together. We will be bringing that back to Council Finance yet this year.
Travis Storin; I think last time that was a 16-month window around planning and engagement. That suite of
programs from the capital tax is thoroughly vetted and does take quite a bit of time.
Emily Francis; I noticed that both scenarios presented have higher impacts on lower income residents.
Ginny Sawyer; I think anything we do is going to have a higher impact on lower income residents when we look
at gaining revenue in a taxing space. There are ways to work through our existing rebate programs which are
already in place. If we add to taxes, we could also add to a rebate piece.
Emily Francis; I would support bringing something in November 2023. We do need to talk more about why was
Parks & Recreation was elected for 2023. I know we have some immediate needs identified for Parks &
Recreation and we have other options in our other three priority areas. In looking at the pros and cons of which
one to bring forward, know what the trade-offs are would be helpful. I know we have limited time, but that
would be a good session to have.
Ginny Sawyer; we should do that sooner because you are right, the limited time is a very real thing.
Bringing the community along to get behind and be supportive and to understand how that will go forward.
With needing ballot language by August, time is of the essence but, we can certainly have that conversation.
Travis Storin; We would be happy to describe here today, the rational the staff had. I know that there are
community residents supportive of all priorities or particular concentrations of the priorities who are
disappointed with the proposed sequencing but have respect for the fact that ultimately it is the Council’s
decision on what we do here. You have satisfied our first question on whether to go forward with something in
2023. I am happy to provide context now or as we go through the items.
Emily Francis; I feel like there are a lot of trade-offs and benefits to all of them. I don’t feel like I have enough
information to give any direction.
Julie Pignataro; I agree and that was my question as well, why Parks & Recreation was prioritized. We all know
there are issues and trade-offs, and I would love to hear why staff thought that was the best way to go.
Travis Storin; we treated the renewals as something of an anchor that the others initiatives are sort of
responding around. For us, 2024 made a lot of sense as it still allows for two chances in 2024 and 2025, should
the voters not approve the renewals in 2024. It became a question for us around 2023 and 2025. In addition to
what Ginny mentioned around the currently provided services and the amenities that are reaching a state of
disrepair. For us, it came down to two equally important things;
1) Ballots – which comes down to odds and probabilities. We have reason to believe that given the success in
other communities, taxation on marijuana and other substances mentioned have a pretty decent chance a
good of successes.
2) As it related to using those funds on parks, we were assessing all 4 priority areas that are each part o f
Council’s 31 adopted priorities. When we talk about affordable housing, transit and climate, we know that
there are some really powerful policy levers, and current resourcing levels that are helping to reach the
goals around 2030. In the case of climate, we know that much of our results will be driven by Utilities and
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the dialogue around anticipated rates increases through Platt River Power Authority in order to achieve
those goals, knowing that is not the entirety of the resourcing needed for our climate future. We are at least
assured of some level of progress and a reasonable chance of success at 80% GRG reduction by 2030.
In the case of Affordable Housing, that is where the powerful policy levers existed, whether that is the land
development code or occupancy or the many things we have talked about with Council through the
Affordable Housing Strategic Plan that are not necessarily resource dependent (as helpful as the resources
may be) we are assured of some level of progress within the next 7-10 years.
On Transit, we have these federal funding opportunities, that are not necessarily as available or widespread
across the other three categories.
From the staff perspective, Parks & Recreation is the one that is existing in a largely un resourced state and lacks
either the current resourcing or the heavy hitting policy levers to advance those. So, those are the two factors in
our rationale; 1) probabilities of ballot success and 2) the other avenues of progress toward the other three
priorities.
Ginny Sawyer; we do acknowledge there are trade-offs, one being finding the matching dollars for those transit
grants, that is a very real thing. We are acknowledging that and having those conversations. Knowing what the
gaps are across, knowing that we have renewals, I think leads to – that we need to run something this
November and that is right away. People love our Parks & Recreation. These taxes on marijuana, tobacco and
alcohol are pretty favorable if you look across the landscape and so it felt doable.
Kelly DiMartino; one things to add, we talked one, this is an explicitly stated Council priority that we think is
aligned well with your conversations around that asset management gap that we are trying to address. From a
vetting perspective, we know that is one that has been multi-year conversations with Parks & Recreation Board
and some of that community advocacy piece so there were some other considerations in addition to what Travis
and Ginny have outlined.
Julie Pignataro; I hear you that was one priority, but I see 14 or 15 that have to do with the other ones.
I also hear that you are looking at matching grants that would be available in further years. Is that what you are
saying as a reason to put it off?
Ginny-Sawyer; I was just calling that out as a straight up trade-off. That is a risk.
Julie Pignataro; It is hard because I love all of those things as do a lot of people. All of these are so important.
Frankly, I am tired of putting off climate, very tired of putting off climate. I know we have bigger problems with
the parks where we are talking about how we are going to continue O&M, but, I am not feeling strong that we
have that answer. I see what you are saying the anchoring of the renewals which made perfect sense but it
makes the trade-off even more extreme which I am trying to wrap my head around. Is it possible to break those
three things up? We have talked about having climate, affordable housing, and transit in a package.
Ginny Sawyer; that is doable. If we look at these estimated dollar amounts. Let’s just say 5% on those things
is about $10M. We can divvy that up and put it in different places. There is always that prerogative.
We could put it in the General Fund and put it through priorities and BFO offers because that becomes a bit of a
harder sell to the public and probably disappointing to Parks & Recreation, who has been raising this warning
flag for years. We can do whatever we want and what the community supports.
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Julie Pignataro; that is what I love about putting things on the ballot – the immediate feedback that you get. I
personally, if it is possible, would not object to having both Parks & Recreation and the Climate portfolio in
2023.
Ginny Sawyer; are you talking only with the proposed additional taxes or are you suggesting we run a property
tax as well?
Julie Pignataro; I still need to suss that out. I am still in the baby steps part of figuring out when to put things on
the ballot.
Ginny Sawyer; what we don’t want to do – I appreciate that a ballot is immediate feedback but there are ripple
effects if you don’t win too. It’s hard to say ok, what about this one then and we only get an annual chance at
that now. We want to be really confident and bring the community along and build that story of here is what
you are going to get for these dollars. That is what we have built our reputation on with these taxes. We want
to be cautious and conscientious of that.
Travis Storin; we have been working with partners over at the County, and it is looking increasingly likely that
all of the work that has gone into a childcare tax could come back this November as well in the form of a ¼ cent.
Somewhat speculative but seems likely that we will have another local entity on the ballot as well. I know the
school district has on going challenges as well – in the future looking at their own funding structures.
Emily Pignataro; just to clarity - can you use sales tax to match grants for the transit?
Ginny Sawyer; yes
Emily Francis; in the past, has our CI tax been used for parks?
Ginny Sawyer; yes, it has been used for some things in parks. Mike Calhoon concurs.
Emily Francis; I know people love Parks & Recreation, but I hear most frequently is about climate and housing. I
feel like we continue to put it off. If they were on the same ballot, it doesn’t compute with me that they are
different taxes.
Ginny Sawyer; We haven’t done a Mil since the 90’s
Emily Francis; I think there is support for doing two things at the same time.
Kelly Ohlson; this is one of the biggest and most complex things we do.
clarifying question; on the alcohol tax, it said liquor store estimates only – what about non-restaurant alcohol
sales grocery stores? We must do both to be fair. I sense the days of automatic voter approval of taxes may be
coming to an end.
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Slide 10 Scenario B (see above)
I am not for a ¼ cent sales tax – all taxes are somewhat regressive for lower income folks.
A property tax increase is less regressive than another ¼ cent. If it raises $29M and the number for parks is
$15M or so, what is the other $14M going to?
Ginny Sawyer; when we did these scenarios, we were trying to capture the gaps identified across parks, housing,
climate and transit. These slides were meant to refresh what we have talked about, covering all of the gaps,
knowing it would likely be a phased approach. We don’t think we can go to the voters all at once to get $29M.
These scenarios showed ways we could approach the revenue gaps across all four areas – and across what could
be 3 or more ballots.
Kelly Ohlson; so, the 5% on alcohol, tobacco and marijuana to raise in the neighborhood of $ 11M as one
option. I am not in favor any of them. If I was going to support anything, which is extremely unlikely, it would
be the alcohol, tobacco, marijuana thing and a property tax increase. I think we have declared a climate
emergency. Have we declared a Parks & Recreation emergency? Parks & Recreation is in need of money, if I was
going to support anything I would support that as well. I support the climate thing along with the other
committee members that perhaps we need to aim high. I am assuming the question on alcohol, marijuana and
tobacco could be one question and then the property tax increase would be a second question Do the alcohol
tobacco and marijuana need to be separate ballot questions?
John Duval; the property tax would have to be a separate ballot item. The tax on alcohol, tobacco and
marijuana could be a single item or separately.
Kelly Ohlson; it is almost unpredictable, sometimes almost everything passes, sometimes almost everything fails
and sometimes it is a mix. About 95% city measures have passed.
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By and large, city things pass much more often. You can have a bunch of things on there, if you think they are
worthy and you sell it well (in an absolutely ethical, moral and legal way).
This is the really hard part for me. I helped the city raise over $1B in taxes that didn’t exist before I got involved.
In good conscience, I cannot support additional tax dollars for an organization when I so fundamentally disagree
on the major issues of the day. Not no brainer 7-0 issues, of the action and inactions of the land use code, the
slow and weakened oil & gas regulations and 1041 regulations, Rental Registration & Licensing, Land Use, U+2,
minimum wage. I am not interested in feeding the beast. I will contribute my thoughts, but I won’t be
supporting putting anything on the ballot and won’t be supporting it once it is on the ballot.
Julie Pignataro; Kelly I appreciate you bringing those things up but I won’t speak for other councilmembers but I
see what is happening a little differently. Previous Councils used agenda setting and keeping things off of the
agenda or postponing as a way to permanently table things. The things I have voted to postpone have been
because I needed more data to know if we are improving or causing more problems. I am looking forward to
minimum wage and rental registration coming back. I have a listening session scheduled that is specifically
targeted for renters in District 2 because we are not getting to these people. I am looking forward to coming
back to these things with more information to make more informed decisions. As you have said Kelly, ‘different
opinions make for a better product in the end.’
Ginny Sawyer; I would say is we are going to look at bringing something in November which means we need to
light a fire under what that would be. We will go back and look at what we can do with $10M, if it is tobacco,
marijuana and alcohol across the priority areas and maybe even just in the climate area and see what that looks
like. What impact it could make.
B. Airport Terminal Project
Travis Storin, CFO
Jason Licon, Airport Director
EXECUTIVE SUMMARY
The purpose of this item is to seek Council Finance Committee direction on the contractual conditions
associated with a proposed capital contribution to the Airport.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance support bringing an appropriation to Council
2. If yes, which performance indicators or gates would the Committee recommend pursuing as a condition of
the capital contribution?
BACKGROUND/DISCUSSION
The Fort Collins Loveland Airport is seeking additional funding to complete their total need for the $27M project
of a new terminal facility. This new terminal will replace the inadequate, temporary facilities used for growing
multi-modal transportation segment, charters, and future airline services. The new terminal will include two
airline gates, Denver Airport transportation, and transit access. The total cost of the project is being funded by
Federal Funds ($23M), Airport Capital Reserves ($2M), City of Loveland contribution ($1M), and seeking a City of
Fort Collins Contribution of ($1M). This will give the project the total needed to complete the work.
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At the January Council Finance meeting, Committee members directed staff to identify performance outcomes
that could be attached as condition to a forgivable loan or capital contribution. Staff has identified an array of
possible performance metrics for discussion:
Condition Baseline / Current
State
Target State
1) Cities’ annual operations/maintenance
contributions
0%
(since 2019) 0%
2) Leadership in Energy and Environmental
Design (LEED) Silver building certification N/A Yes
3) Public art commitment at 1% of non-
federal contributions No Yes
4) Carbon Footprint of Building 236 MTCO2e 198 MTCO2e
5) Number of annual outbound passengers
served (bus and air) 18,000 33,000
6) Enhance accessibility Partial Fully
7) Achieve regularly scheduled commercial
air service No Yes
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance support bringing an appropriation to Council
2. If yes, which performance indicators or gates would the Committee recommend pursuing as a condition of
the capital contribution?
DISCUSSION / NEXT STEPS
Julie Pignataro; what is the status of the remote tower with the FAA?
Jason Licon; the vendor that the FAA selected is working on developing some solutions for some newly created
FAA criteria on these new emerging systems. The remote tower concept was pioneered by our installation of a
system and one in Leesburg, Virginia that predated us by a couple of years. As a result, our system was
deployed in late 2019 / early 2020 right before the pandemic. Due to timing, the FAA had more time to really
think through the requirements of such a system and as a result of that, some criteria have changed. The
vendor is working to create solutions to address those updated criteria that the FAA developed and released
about a year ago. One of the biggest hurdles is the visibility requirement for the cameras and displays was
increased by 50%. The existing system that was created and deployed in 2019, isn’t able to accurately depict.
The vendor is looking at upgrading their system to a higher definition capable camera and display. They are
hoping to bring that up later next month to begin testing and hopefully get us back on track.
with the certification of the new system by the FAA.
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Julie Pignataro; if things go that way, what is the timeline for approval?
Jason Licon; we don’t have one yet. There are still a lot of questions we need to get answers to from what the
FAA has told us. It will take testing that and making sure it works properly. Fully retrofitting the system so that it
Will work at that elevated level. Upgrading to 4K cameras from the HD cameras that they currently use.
Kelly Ohlson; I am not for it, but I understand why some are for it. I think it is a Loveland Airport no matter what
they call it, therefore, I think they should be responsible for funding of the $2M. It is their city limits and they do
the land use planning. Back in the day, I didn’t even support the $60K because I thought it was a Loveland
airport. A that time, I thought mostly corporations and wealthy individuals were using it. Just like our Impact
fees, I am not up to speed as to if there are impact fees there on commercial aspects and the regular users of
the airport. I am not for subsidizing things that stimulate more growth with public dollars. I am not interested
in a commercial airline coming in. The land use planning for the county and the city of Loveland exactly
designed our land use planning and our residential development around massive commercial use. I am not
interested in fueling more growth which doesn’t help our climate goals or our affordable housing goals. The
opportunity costs of the $1M – some hesitation on funding
Emily Francis; do we still contribute even though that slide is very specific to operations and maintenance?
Jason Licon; there is no contribution directly to the airport at this time from either community.
Emily Francis; so, we haven’t contributed anything since 2019?
Jason Licon; correct – nothing since 2019.
Emily Francis; what is the timeline for meeting these benchmarks?
Jason Licon; there are some that are tied directly to the building. Once the building is complete as it relates to
leadership energy and environmental design, LEED Silver Designation and carbon footprint. As it relates to
outbound passengers, we can tie that to some of the forecasts that our Airport Master Plan identified and were
adopted in 2020. We looked at those forecasts and believe it would be a three year timeframe to get to the
33K mark. The accessibility piece is fully dependent on how much redesign we would need to do. We had
mentioned partially and fully because we may have to take out some of the components that would enhance
baggage claim access and that may make it more difficult for those who have less accessibility. The end of
project would be approximately October of 2024, and then the three years that would in addition to that for the
outbound passenger component.
Travis Storin; there is a ground lease that is associated with the Police Training Facility that is paid to the FAA by
Police Services.
Jason Licon, federal requirement dictate that any land lease for that type of use does require fair market value.
Primarily due to the fact that the federal government provided the land to the cities as a steward. Our funding is
heavily reliant on federal resources for maintaining the capital needs for the airport.
Emily Francis; I think I heard you say it would be about seven years.
Jason Licon; we are hopeful that most of this will be five years. A two-year program for building the facility, and
then another three years on top of that to get to forecasted passenger counts.
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Emily Francis; why wasn’t the security-to-security landline included in one of the benchmark options?
I would rather see that as a benchmark instead of a commercial airline which is not of interest to me.
Jason Licon; I think it kind of dove tailed in with the commercial air service since it is a private sector driven
benchmark. We are very excited about that potential as well and continue to move forward in partnership.
That is something that is not totally within our control to be able to manage or have a direct influence over.
Emily Francis; I thought that was the point of having a terminal.
Jason Licon; It is, we do include bus and air transportation in the number so that metric is inside the numbers.
As far as getting the secure-to-secure functionality - the proof of concept on getting the bus transportation past
the security checkpoint at DIA certainly is our goal but we don’t’ have a timeline on that.
Julie Pignataro; does landline do that anywhere?
Jason Licon; they don’t – they do have partnerships with three other airlines including Sun Country, American
and United. There are other air carriers that are working in parallel with our project to try to get that capability.
There are more players who have recently helped our push to get this through the various approvals that are
needed from TSA and within the airlines themselves on who is undertaking some of the risk between the
point to point and making sure those security compliance metrics are met. Most of that is heavily dependent on
the air carriers. We are getting through a lot of the procedures and statement of operational
viability for making sure we are able to get there.
Julie Pignataro; is it a correct statement that no bus service such at landline has achieved that yet?
Jason Licon; that is correct. We hope to be one of the first and as with any pioneering concept, we are trying to
develop as we go, we have a lot of work completed but more to do as we work through some of the finer
details. The end points (both airports) are pretty much done, the in between that has been causing the most
challenge for us from the liability standpoint (who is responsible for what) and security and regulatory
compliance.
Kelly Ohlson; I just wanted to thank Emly for asking for some performance outcomes at our last meeting.
Last night in another meeting, I was asked how I thought the current staff was compared to years ago. To me it
is light years better. It is not us versus them nearly as much, of course there will always be conflict and different
values. Commending Travis for transparency and full disclosure, not making Councilmembers ask the subset of
the subset to get the full answer. Back in the day you would have had to probe for that. Things are much more
professional. Does that mean that we had an obligation, but we are meeting it through this land lease and that if
we didn’t have the land lease we would still be paying money into the airport?
Travis Storin; I appreciate the complement and the answer is yes.
Kelly Ohlson; how much money would that be if we weren’t paying it through the land lease?
Jason Licon; I believe it is approximately $180K annually from each city for the land lease for the 43 acres of
space.
Kelly Ohlson; I am sure there are valid reasons, but we do give three times the $60K.
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(see slide 7 below)
Kelly Ohlson; I do want to understand the carbon footprint, is that for the operations? I think we are using most
of the old buildings and it is not figuring in the cost because there is carbon footprint for the construction.
Are the 236 MTCO2e and the 198 MTCO2e for the ongoing O&M? Is that for the ongoing carbon footprint for
the existing buildings?
Jason Licon; it would be for the new building itself based on what the annual heating and electrical usage.
That will be a minimum as there will be some additional facilities that will be decommissioned as a result of this,
further lowering the amount of energy use. This building will be replacing buildings that are less efficient.
Kelly Ohlson; do you get the $1M upfront or after you have met these performance metrics?
Travis Storin; an upfront contribution that is repayable should the selected goals not be met.
Emily Francis; I am not interested in using public dollars to fund charter or commercial airline.
So, for me the funding the terminal is really funding the ability of landline to be direct to DIA. I am hearing that
it is unknown, and I understand why. I agree with the metrics that are in there, but I would like a metric around
landline. I think this should go to the full Council. I don’t know if this committee has a recommendation.
Jason Licon; Landline Service is operating still, the only component that we are missing is the secure-to-secure
functionality. We do have nine round trips daily that are being utilized. The TSA security component is still the
thing that is a work in progress.
Julie Pignataro; I think this should go to the full Council. I am still torn. I do appreciate the metrics and I think 1-
6 is the best way to go. If we could do something even though it is external dependency to get the secure-to-
secure functionality. Since this first came, I have heard from people on both sides, it is pretty evening split. It is
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very interesting what does and does not raise flags. Encourage more thought into maybe an additional metric –
being very clear what payback would look like if it came to that. I appreciate all the work. Bring it to Council
and I encourage a little bit more in the metrics;
C. Trash Contracting Admin Fee & Potential Appropriations
Kira Beckham, Lead Specialist, Environmental Sustainability
Rachel Rogers, Senior Specialist, Economic Sustainability
SUBJECT FOR DISCUSSION Administrative Fee and request for appropriation in the amount of $107,251 in 2023
from the General Fund for the Residential Solid Waste Collection Program.
EXECUTIVE SUMMARY
The purpose of this item is to seek feedback on the recommended Residential Solid Waste Collection Program
administrative fee and to request an appropriation in the amount of $107,251 from the General Fund to support
the start-up phase of the program.
One of the adopted Council Priorities is to explore a contracted system for garbage, recycling, and compost
collection for single family homes. On February 21, 2023, City staff will present a draft contract and Ordinance
to City Council for First Reading. By passing the Ordinance, Council would create a new Residential Solid Waste
Collection Program.
An administrative fee for the Residential Solid Waste Collection is proposed to defray City costs to run the
program. An Administrative Fee Study was done to evaluate City program costs, the recommended fee range,
and projected revenues. The recommended administrative fee is proposed to not exceed $1.35 per household
per month to ensure repayment during the contract term.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance Committee have feedback about the recommended administrative fee of no greater
than $1.35/household/month?
2. Does Council Finance Committee have feedback about the appropriation request of $107,251 from the
General Fund in 2023 to support the start-up phase of the Residential Solid Waste Collection Program?
BACKGROUND/DISCUSSION
Fort Collins has adopted aggressive waste reduction goals, including working toward zero waste by 2030, and
has identified a stagnant residential diversion rate as one of the challenges of making progress on that goal.
Strategies to achieve zero waste are outlined in Our Climate Future, the combined waste, climate and energy
plan for Fort Collins, which can be viewed at www.fcgov.com/climateaction/our-climate-future.
For decades, Fort Collins has utilized a licensed open market collection system. Licensing requires haulers to
report the materials collected from all sectors of the community, which is used to calculate various diversion
rates. In 2020, the Community Diversion Rate (including residential, commercial, and industrial materials) was
52% and the Residential Diversion Rate was 29%. Details of Fort Collins diversion rates can be found in the
annual reports at www.fcgov.com/recycling/publications-resources.php.
To support increased waste diversion, one of the adopted Council Priorities is to explore a contracted system for
garbage, recycling, and compost collection for single unit homes.
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Changing to a contracted system could help achieve the following goals:
1. Reduce the number of trucks on residential streets and achieve street maintenance savings as well as
increase safety in residential neighborhoods
2. Reduce greenhouse gas emissions
3. Increase diversion of recyclable materials and yard trimmings and encourage reuse of bulky items as
much as possible
4. Provide equitable pricing throughout the community
5. Provide cost-effective pricing for collection services
6. Provide a high level of customer service
SCOPE
The contractor would provide these core services over a term of 5 years:
1. Solid Waste collection
2. Recyclable materials collection
3. Yard trimming collection
4. Bulky item collection
5. Billing
6. Customer Service
Services would be provided for all single unit residential housing and multi-family housing of seven units or
fewer that use carts for collection. The following would not be included in the program:
• All commercial and industrial establishments and multi-unit housing containing eight (8) or more units.
• All households served by a dumpster.
• Homeowners’ Associations with contracts for solid waste, recycling, and yard trimmings collection. These
contracts must be effective before the effective date of the City’s contract and comply with all applicable
requirements of Chapter 12 and Chapter 15 of the City Code
• Residential units that have been granted a variance for shared service or excess producers as defined in
Chapter 12 of the City Code
Residents that fall within this scope would be required to utilize the service or pay an opt-out fee equivalent to
the service cost of the smallest trash cart size.
The City may provide billing service in future contracts, which would require a new evaluation of the City
administrative fee and contractor pricing.
Key Milestones and Dates
• April 12, 2022 - Council Work Session
• April, June 2022 - Community Conversations
• July 12, 2022 - Council Work Session
• July 19, 2022 - City Council passed a Resolution directing City staff to proceed with developing a Request for
Proposals (RFP) for a single hauler contracted system
• September 13, 2022 – City staff released a Request for Proposal (RFP)
• November 1, 2022 – Three haulers respond to RFP: Republic Services, Waste Management of Colorado, and
Sweetman Sanitation
• November 28, 2022 – Hauler Interviews
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• December 2022 through January 2022 – Contract Negotiations
• February 21, 2023 – Staff will present the draft contract and Ordinance for First Reading with Council at a
regular meeting.
• March 7, 2023 – If adopted on First Reading, Second Reading would
By passing the ordinance in February, Council would create a new Solid Waste Collection Service Program.
Service would expect to start 12-18 months after the contract was signed.
Administrative Fee Highlights
The proposed Residential Solid Waste Collection Program includes an Administrative Fee.
Cities imposing new fees are required to demonstrate a clear connection between program costs incurred by
the City and the subject of the fee. The purpose of a fee is to defray the cost of providing a service to the
community.
The Residential Solid Waste Collection Administrative Fee Study is attached for further details on anticipated
revenues, costs, methodology, and peer community case studies.
Fee Components
To deliver on the City’s role in administering the contract, there are four primary elements that are needed, see
Table 1.
Table 1. City Roles in Administering the new Residential Solid Waste Collection Program (more details are
included in the Administrative Fee Study):
Need Key Activities
Program Management Contract administration, performance reviews, transition support for community, grant
management, lead contract renewals, staff supervision
Customer service Answering questions from public, support billing escalation and tracking, ready customer
service software/develop tools, records retention
Compliance Investigate complaints, check HOA compliance, check variances, enforce contract and
code, ready software/develop tools
Education, Outreach, and
Program Support
Collateral review, community communications and education, HOA specific
communications, recycling and yard waste education, program communications
To deliver on these roles, the following estimated costs include outreach and communication, tools and
materials, and staffing. Peer communities shared that start-up and transition phases (end of one contract and
start-up of a new contract) require a larger staffing level to ensure quality customer service, smooth transitions
for residents, an effective and efficient purchasing process, and to communicate and educate the community on
coming changes.
The estimates shown in the table below represent a summary of the range of anticipated program costs and
number of full-time equivalent staff (FTE). A contingency of 5% has been added to overall costs to allow for
inflation and unforeseen expenses. As negotiations are ongoing, these costs are being refined by the project
team and may be updated in advance of the Council Finance Committee.
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Table 2. Costs to the City for the new Residential Solid Waste Collection Program. Note: Transition expenses are
included in these annualized expenses but are averaged over the contract term (when the City will receive
revenue):
Cost description Annual cost range (low)
Assumes 2 FTE
Annual cost range (high)
Assumes 4FTE
Outreach and communications $31k $31k
Tools and materials $59k $59k
Mileage $3k $3k
Staffing $243k $448k
Contingency $17k $27k
Total Cost $353k $568k
Methodology for Fee Calculation
Key drivers of the administrative fee necessary to break even within the 5-year contract term:
• The staffing level required to support the program.
• Repayment period
• Number of contributing households
Staffing: The transition from a licensed system (which requires less than 0.25 FTE) to a new contracted system
will require additional resources, including staffing. Table 2 includes the estimated need of 2 to 4 FTE.
Repayment period: The repayment period for the costs shown in Table 2 has been aligned with the contract
term.
Number of contributing households: Staff has done extensive work to size the range of in-scope households.
This includes GIS mapping and analysis and HOA identification. The number of households will be clear by the
service start date but are modeled as a range based on best information available at this time.
Fee
Further clarity in the future: As the number of households and the necessary program costs become clear over
time, the administrative fee may be adjusted to meet the goal of covering the program costs but not
substantially accruing funds over time.
Recommended Fee Range
The estimated fee ranges from $.65 to $1.35. A conservative approach to the fee helps to minimize risk of a
lower number of households being in-scope or higher program costs. Table 3 below illustrates the range of
administrative fee minimums.
Staff is recommending setting the administrative fee at $1.35 per household per month, as this will allow
revenue to cover anticipated program costs over the term of the contract. Staff will review all fee drivers at
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least annually and prior to service start date to determine if a change to the fee is warranted. Changes to the
fee would require formal Council action by resolution or ordinance.
Table 3. Minimum administrative fee levels for different levels of staffing and numbers of households:
Requested Appropriation
An appropriation of $107,251 from the General Fund is requested to support the 2023 portion of the start-up
phase of the Residential Solid Waste Collection Program. This appropriation amount supports both 2 FTE and 4
FTE scenarios modeled, as only 2 FTE are scheduled for program startup, i.e., additional staffing would be added
after service starts. The funding appropriated for 2023 startup costs will be repaid from administrative fees once
they begin to be collected ensuring that the City is not subsidizing the cost of this service.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council Finance Committee have feedback about the recommended administrative fee of no greater
than $1.35/household/month?
2. Does Council Finance Committee have feedback about the appropriation request of $107,251 from the
General Fund in 2023 to support the start-up phase of the Residential Solid Waste Collection Program?
DISCUSSION / NEXT STEPS
Julie Pignataro; throughout this whole program, I have been so impressed with your department and your
research and the way you have provided all information – Bravo. I am fine with both questions.
Do we know what the price range is for a single-family home?
Admin Fee Minimums
2023-2029 (5-yr contract + start-up)
Number of Households
Staffing 35,500 40,500 45,500
2 FTE $0.85 $0.75 $0.65
4 FTE $1.35 $1.20 $1.05
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Lindsay Ex; we just completed the contract a few hours ago – the slide above was created after the packets went
out.
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Julie Pignataro; are the fees on top of or included in these amounts?
Kira Beckham; the fees are included in those amounts.
Emily Francis; I am a yes to both of the questions in front of us. Such great work – the study and analysis. I think
it is a nominal fee.
Kelly Ohlson; yes to both – I want to echo the quality of the work
1986 prices would most likely go down – these numbers presented exceeded my expectations.
Historically every staff member and consultants have agreed with me on the road to zero waste.
It was a compromise about the HOA thing, but the commitment was made by staff that HOAs would have to
comply with the pay as you throw.
If there a commitment from staff that we will eliminate the gaming of the system – what happens is people get
bigger carts for a cheaper price than the rest of Fort Collins. That flies in the face of the Climate and the Pay as
You Throw programs and of the solid waste and recycling. Most HOAs receive bigger carts for a cheaper price.
Do I have a commitment from the organization that you are serious about the compliance, and they will not be
exempt from this program?
Kira Beckham; we are absolutely committed to compliance on the HOA front. If this is adopted, one of the first
things we are going to tackle after our discussions with you in July is to look at existing contracts and making
sure those are adjusted to accommodate the pay as you throw requirements.
I think you have staff’s full commitment – across the board for HOAs.
Kelly Ohlson; this isn’t easy work, but this is great work and I look forward to it coming to us.
D. Audit Selection Process
Travis Storin, CFO
I wanted to apprise the committee of a competitive process every five years to select an Audit firm. The
committee itself has some charter driven responsibilities around. This is the only city service I am aware of
where the Council is directly awarding a contract. Our charter requires that we undergo an independent
external audit every year. The Council makes the decision as we should not be our own watchdog. We have
limited our auditors to a term of five years and a given audit firm maxes out after two terms. Our current firm is
reaching the end of their five year term and they are eligible to bid on the next five year term.
The process begins in April, when we will come to this committee and gather your input for the contents of an
RFP. Staff will look to narrow down the respondents to 2-3 candidates to bring in for live interviews in a public
meeting likely in July or August. By the end of the year, we will look to the Council to have awarded the
contract so we can end 2023 and know who our new auditor will be. Conducting the interviews will likely take
up an entire Council Finance committee meeting.
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Blaine Dunn; our current audit firm is eligible to respond to an RFP again, but they will need to change the
partner who is on our engagement. So, if you remember Chris Telli is our partner on the engagement now. This
is part of the due diligence, so we don’t get too comfortable. Should FORVIS choose to respond again, they will
need to bring a different partner.
The ‘partner’ is the person who is actually signing the audit opinion. We have mandatory rotations built in that
mimics the private sector around Sarbanes-Oxley requirements.
Baine Dunn; the audit firm reports to this committee. In between this meeting and the meeting in April, I am
guessing based on timelines from previous years, that we will receive our formal engagement letter from this
year’s audit and we will pass that document on to the committee as soon as we receive it so you can see
everything they are doing and their full scope of services as well.
Julie Pignataro; having never interviewed for an auditor, prior to the interviews can you provide us with some
context on what makes a good auditor and lessons learned from firms we have engaged with in the past.
Travis Storin; yes, we can incorporate that into April. Your April input will basically create the requirements for
the RFP that the firms will respond to. The success criteria are really important to label.
Kelly Ohlson; should this be a one off, separate meeting?
Travis Storin; and it would be helpful if the meeting is 3 hours long to allow adequate time for 3 firms to
present, should that be the case. The firms would prefer to give in person presentations if possible.
Julie Pignataro; It may make sense to possibly make this a separate meeting. I prefer three candidates as having
two candidates is not really a choice.
A special three hour in person Council Finance Committee meeting to be scheduled. Carolyn with work with
Sarah Kane.
Meeting adjourned.
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COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Lance Smith, Sr. Director of Finance for Utilities
Gretchen Stanford, Utilities Deputy Director of Customer Connections
Date: March 2nd 2023
SUBJECT FOR DISCUSSION
Utilities Billing System Appropriation
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
1. 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
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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 is 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.
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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%
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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.
ATTACHMENTS (numbered Attachment 1, 2, 3,…)
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
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Utilities Billing System
Appropriation
03/07/2023
Lance Smith
Senior Director of Finance for Utilities
Gretchen Stanford
Utilities Deputy Director of Customer
Connections
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2Direction Sought
1.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 Utilities Customer Information System –Customer Self
Service Portal?
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3Solution Analysis and Provider Selection Timeline
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4Implementation Project Management, Quality Assurance and Contract Review
Project Management
•Managing project scope, installation plans, schedule and budget
•Minimizing project risks by proactively addressing issues as they arise
•Addressing staffing challenges for the Solution Provider and City
Quality Assurance
•Product testing and process validation
•Establishing clear service level expectations
•Ensuring project requirements are met within the initial project scope
Contract Review
•Outside Counsel will ensure that the City’s and its ratepayers interests are
front and center in the solutions agreements
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5Contractual Staffing for Implementation
Contractual Staffing
•Allow existing staff to focus on how the new solution will function after deployment
•Ensure operational requirements are ready before go-live
•Allow training of some staff as the implementation proceeds
•Informal trainers ready before go-live
Contractual employees will be trained to backfill the positions of staff working on the
implementation to maintain current levels of customer service and operations
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6Appropriation Requested
Implementation Project Management and Quality Assurance $1,500,000
Contract Review and Counsel $100,000
Contractual Implementation Staffing $2,650,000
$4,250,000
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7Available Reserves
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
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8Direction Sought
1.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 Utilities Customer Information System –Customer Self
Service Portal?
Page 41 of 75
Page 42 of 75
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Blaine Dunn
Chad Crager
Date: March 2, 2023
SUBJECT FOR DISCUSSION
Connexion – Capital Management
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.
Page 43 of 75
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.)
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ATTACHMENTS
Attachment 1 – presentation slides
Page 45 of 75
Connexion -Capital Management: Council Finance Committee
March 2, 2023
Page 46 of 75
Agenda
2
1.Timing of Funding Need
2.Resolution for Council
3. Questions
Page 47 of 75
Question
Does Council Finance Committee support the recommendation to bring
forward a resolution to Council to reimburse Connexion for expenditures
through a future bond offering?
3 Page 48 of 75
Where are we now
4
•At the January 10, 2023, Council Work
Session, the need was identified for
additional funding to complete the
network buildout and customer ramp-
up.
•This outlook remains the same.
•Approximately $20 million additional
funding is needed:
•$16 million for capital
•$4 million for operations
•December 2024 is timeframe for
maximum need with 2025 projected as
breakeven (revenues covering capital,
operating expenses and debt
payments).
•Connexion will definitively exhaust the
existing L&P reserve usage
appropriation of $20 million by June
2023 (and could be as early as April).
•Timing of the Connexion needs
prompts desire to act to preserve
maximum flexibility with potential bond
proceeds.
Page 49 of 75
Existing Bond Overview
5
DescriptionExisting Connexion Bonds
Amount Issued $129.6 M *
Maturity -Year2042
PaymentsSemi-Annual in June and December
Rate / Yield-to-Maturity4.1%
Avg. Annual Debt Service$6.7M
Max Annual Debt Service$10.2M
Earliest call date (Series A only: $84.9M)6/1/2028
*Current amount outstanding is $128.4 M
Page 50 of 75
Debt Issuance
6
•Connexion knows there will be an additional need for capital in the future
•Current estimate is ~$20M
•Light and Power will also need to issue debt later this year
•Current estimate is ~$40M
•Issuing Connexion and Light and Power debt at the same time is
advantageous
•Allows for cost of issuance savings
•Larger issuance is more attractive in the market
•Cuts down on recreating multiple documents for separate issuance
Page 51 of 75
Reimbursement Resolution
7
•Connexion will go negative before we are able to issue new debt
•Connexion and Light and Power have different timelines for their needs
•Connexion can use debt proceeds to reimburse soft costs
•Adoption of resolution allows Connexion to also use proceeds to reimburse
capital costs
•Resolution declares official intent of the City to use proceeds for
reimbursement
•Allows Connexion to look back 60 days from adoption for
reimbursement
•Any capital costs after adoption can be reimbursed
•Allows City to maintain tax exempt status on the issuance of bonds
Page 52 of 75
Timeline
8
Date*Activity
Mar 21 Reimbursement Resolution to Council
Jun 1 Review bond ordinance with Council Finance Committee
Jun 20 First reading of bond ordinance
Jul 18 Second reading of bond ordinance
Aug 9 -11 Finalize ratings with Agencies
Aug 22 Receive ratings
Sep 8 Post POS
Sep 19 Sales of bonds
Sep 19 First reading of appropriation of bond proceeds
Oct 2 Receive funds from sale
Oct 3 Second reading of appropriation of bond proceeds
*All dates are subject to change Page 53 of 75
Appendix
10 Page 54 of 75
Business Plan vs. Current Project Estimates
11
109.0
158.0
20.5 4.5 2.1
11.6 8.5 3.6
(1.8)
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
Business
Plan
Mainline
Build
Project Mgmt. /
Engineering
Systems Premise
Install
Premise
Boring
Growth Facilities /
Fleet
Current
Estimate
Connexion Capital Project -$M
* Does not include an additional $18 million of contingency
*
Page 55 of 75
Financial Summary –Project Life to Date
12
Bond Proceeds 142.2$ Debt/Interest Pymts (27.3)$
L&P Reserve Draw 17.2$
Cost of Sales (2.9)$
Operating Revenue 20.5$ Operating Expenses (19.0)$
Interest 6.9$ Total Expense (21.9)$
Total Revenue 27.4$
Capital Project (136.3)$
Total Inflows 186.8$ Total Outflows (185.5)$
Connexion - as of January 31, 2023 ($M) - Preliminary, Unaudited
Inflows:Outflows:
Page 56 of 75
Capital Project Spending Update
Description
Business Plan
and Approved
Updates
01/31/2023
LTD Spent
Current Project
Estimate thru
Dec 2024
Network (Primarily AEG)$84M $107M $110M
Installation (On Trac, boring)$13M $17M $36M
Equipment & All Other $12M $18M $12M
Subtotal Business Plan $109M
Contingency & Re-deploy –Sept. 2021 $13M
L&P Reserves Appropriated –Apr. 2022 $20M
Total Capital Budget/Estimate $142M $136M $158M
13 Page 57 of 75
2023/2024 Outlook
2023/2024 Inflows / Outflows Total *
Revenue $43.6 M
Reserve Draws plus New Bonds $22.8 M
Total Inflows $66.4 M
OPEX / Cost of Goods Sold ($22.3 M)
Debt Service –Existing Bonds ($18.8 M)
Debt Related -Draws & New Bonds ($2.6 M)
Capital Expenditure ($21.3 M)
Total Outflows ($64.9 M)
Net Surplus $1.5 M
14
* For 23 months February 2023 –December 2024 Page 58 of 75
Page 59 of 75
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Lawrence Pollack, Budget Director
Date: March 2, 2023
SUBJECT FOR DISCUSSION
Review of the 2023 Reappropriation Ordinance to appropriate prior year reserves.
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?
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
Page 60 of 75
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 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
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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
Page 62 of 75
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.
Page 63 of 75
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
Page 64 of 75
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
Page 65 of 75
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
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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 IMPACTS
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.
ATTACHMENTS
PowerPoint presentation
Page 67 of 75
2023 Reappropriation Ordinance
Council Finance Committee Meeting –March 2, 2023Page 68 of 75
2Reappropriation Summary
What does Reappropriation do?
•Appropriates funds from prior-year reserves into the 2023 budget for the same
specific uses that were originally proposed and approved for 2022
What qualifies for Reappropriation?
•Funds that were originally appropriated (authorized by Council) in 2022 for a specific
purpose, but were not fully expensed or encumbered by the end of the fiscal year
•The executive team has reviewed the reappropriation requests and concluded that all
2023 reappropriation items submitted are still high priorities to be completed
Page 69 of 75
3Reappropriation Amounts by Fund
Amount by Fund being requested for Reappropriation:
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
Page 70 of 75
4Reappropriation Detail -General Fund
GENERAL FUND:
#Department Request Name Amount
1 Police Services - Office of the Chief K9 Vests $3,520
2 Police Information Services NCRCN (Northern Colorado Regional Communication Network)$300,000
3 City Manager's Office Council High Performing Board $18,295
4 City Manager's Office DEI Principles of Community $8,000
5 City Manager's Office Land Acknowledgement Funding $16,065
6 Parks Park Planning & Development Special Project Support $5,600
7 Comm Dev & Neighborhood Svcs Mediation and Restorative Justice Services $4,526
8 Social Sustainability EV Credits $238,000
9 Natural Areas West Nile Virus $8,748
GENERAL FUND TOTAL $602,754
Page 71 of 75
5
TRANSIT FUND:
TRANSPORTATION FUND:
WATER FUND:
Reappropriation Detail –Other Funds
#Department Request Name Amount
10 Transfort / Dial-a-Ride PSD & Transfort Collaboration Study $55,750
TRANSIT FUND TOTAL $55,750
#Department Request Name Amount
11 Traffic Neighborhood Traffic Mitigation Program Project Construction $100,000
TRANSPORTATION FUND TOTAL $100,000
#Department Request Name Amount
12 Ut Water Resources Div Northern Integrated Supply Project (NISP) Response & Engagement $52,500
WATER FUND TOTAL $52,500
Page 72 of 75
6
BROADBAND FUND:
DATA & COMMUNICATIONS FUND:
UTILITY CUSTOMER SERVICE AND ADMINISTRATION FUND:
Reappropriation Detail –Other Funds
#Department Request Name Amount
13 Broadband Re-Deploy of Broadband Working Capital $4,361,774
BROADBAND FUND TOTAL $4,361,774
#Department Request Name Amount
14 Information Technology Staff Augmentation for Network and Voice Operational Support $86,000
DATA & COMMUNICATIONS FUND TOTAL $86,000
#Department Request Name Amount
15 Utility Tech. & Cust. Service Utilities IT Minor Cap $170,848
605 - Utility Customer Service and Administration $170,848
Page 73 of 75
7Historic Reappropriation Ordinances
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
2016 2017 2018 2019 2020 2021 2022 2023
Proposed
Total All Funds General Fund
Page 74 of 75
82023 Reappropriation Summary
Guidance Requested:
Does the Council Finance Committee support moving forward with
the 2023 Reappropriation Ordinance on the Consent Agenda at the
March 21, 2023 Council meeting?
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