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Home My WebLink AboutMinutes - Finance Committee - 02/09/2015 -Finance AdministrationCituof215N.Mason Street72Flooro•t CoLLins ~:ll~co8O522 fax Council Audit &Finance Committee Minutes 02/09/15 10:00 am to 12:00 Noon CIC Room Council Attendees:Ross Cunniff,Bob Overbeck,Mayor Karen Weitkunat Staff:Darin Atteberry,Mike Beckstead,Josh Birks,Cory Christensen,John Duvall, Tauny Gilmore,Bruce Hendee,John Hutto,Jeff Mihelich,Lucinda Smith,Peggy Streeter,John Voss Others:Dale Adamy,Kevin Jones,Brad Decker,John Little Approval of Minutes Ross Cunniff made a motion to approve the January 12,2015 Council Finance Committee minutes. Bob Overbeck made a second to the motion.The minutes were approved unanimously. Police Regional Training Facility John Hutto and Mike Beckstead provided a presentation to review the proposed Regional Training Campus (RTC)facility.The campus would be located near Boyd Lake on Fort Collins/Loveland airport property. Mike stated that the alternative proposal presented today illustrates three modifications that reduce the capital investment from $24.1 million to $20.4 million.Reductions include: 1.Pistol range reduced from 25 lanes to 20 2.Street grid was taken out can be put in at a later date 3.Maintenance classroom office now turned into a storage facility The primary needs of the partners at the training facility were identified: •Driving Pursuit Speed Track —Fort Collins •Pistol Range and Rifle Range —Loveland Mike explained the capacity level at the facility.The initial facility start-up is anticipated at 65 percent usage with a future expansion consideration over a 20 year growth projection when evaluating capacity issues.It was noted however,that the classroom portion has limited growth expansion. 0 City ofFortCoLlins Bob Overbeck inquired about the value of renting classrooms —this is estimated at $350.00 for a four- hour segment.Letters of intent from the eleven agencies within the region have been received. Mike outlined the operational and maintenance expenditures for the first five-years noting that personnel,range maintenance,track maintenance,and consumables are the largest cost estimates.The presentation provided the following information and considerations: •Financing the project is complicated but doable: Training facility not considered an essential service Facility on leased land Facility co-owned by two municipalities •Year-one is track only,year-two includes the range and class rooms •Market and/or demand opportunities assumes additional rental income The Council Finance Committee members provided the following comments/questions: •What type of facility has Colorado Springs invested in? Denver,Aurora,and CO Springs have either existing facilities or being built •Can a detox facility be included on this campus? There could be FAA concerns and other restrictions •Suggesting offers to other communities to buy-in as partners •Reservations and concerns for the budget impact to Fort Collins It was noted that the current design of the training facility has the potential to be developed into a police academy serving northern Colorado. Darin Atteberry addressed the committee stating that a joint city council meeting between Fort Collins and Loveland will take place on February 12 .The discussion will encourage a cooperative partnership at a 50/50 ownership. Climate Action Plan Financing -CAP Lucinda Smith provided progress to the economic analysis of the CAP.The framework strategies include the following Greenhouse Gas (GHG)reduction categories: •Buildings boosting efficiency,comfort,and improved health •Advanced Mobility —transportation improvements,more convenient and cleaner •Energy Supply and Delivery —shifting to renewable energy resources •Waste Reduction —material regeneration The three main components that drive financial outcomes are: 1.Savings in energy fuel costs 2.Costs incurred for up-front investments 3.Future escalating fuel costs City ofFortCoLlins The CAP presentation gave preliminary estimates on cumulative costs &savings.Lucinda identified caveats in the analysis that does exclude costs related to: •Distribution -infrastructure enhancements •Generation -electric storage resources The Council Finance Committee provided the following feedback: •A concern that the variables and assumptions and not clearly articulated and understood •The strategy needs to be described as a conceptual/feasible strategy and not a detailed set of actions and investments,the details behind individual investments will come later •Concerns of the continued dependence on other entities involved/invested and unknown future scenarios,i.e.,numbers assumed PRPA replaces coal with natural gas by 2029,however this is an unlikely scenario •If Council and other parties procrastinate taking too much time to analyze variables what happens to the ultimate Climate Action Plan •Detailed analysis and information is needed on each strategy before decisions can be made •The possibility of future decisions may come down to an eventual judgment call •Requested that all economic benefits to the CAP should be included in the caveats,i.e.,boosting and improvements to future jobs directly and indirectly,and improvements to public health •The Committee appreciates the information provided Darin Atteberry stated that Platte River Power Authority (PRPA)is a critical partner.He stated that hard decisions are coming however;is hopeful to continue moving forward with the aspirational vision ahead of us. Woodward 2014 Rebates On April 2,2013 City Council passed an ordinance approving an economic development project agreement between the City of Fort Collins,Downtown Development Authority,and Woodward,Inc. The discussion today is in preparation of the upcoming ordinance to appropriate $2.1M of General Revenue Funds. Mike Beckstead provided information to the committee which included: •Rebates allowed per the agreement •Rebate schedule as agreed upon with Woodward •Estimated current rebate due •Key stipulations The agreement states that Woodward is eligible for rebates in three areas and the schedule includes two applications per year: 1.Use Tax on Construction 2.Development Fees 3.Capital Improvement Fees 3 0 City ofFortCoLLins Key stipulations include: •Woodward reaching 1,400 employees by 12/31/18 •Use tax and capital expansion fees include a backfill requirement by the General Fund •Rebate funds will be appropriated by City Council biannually Executive Session At 11:19 am,a motion was made and seconded for the Council Finance Committee to enter into executive session as permitted under article II,section 11(2)of the City Charter,section 2-31(a)(2)of the City Code and Colorado revised Statutes section 24-6-402(4)(b).The executive session constitutes a privileged attorney-client communication. The Council Finance Committee was reconvened at 11:30 am. Woodward 2014 Rebate Discussion -Continued The Council Finance Committee provided the following questions/comments for staff: •Is there a wage requirement related to the 1,400 jobs,i.e.,minimum wage •What constitutes a full-time employee,hours plus length of employment recommending that City Council is provided with this information Mike Beckstead noted that it is staff recommendation to use dollars from the Capital Expansion Funds for that portion of the rebate rather than General Fund dollars. Motion At this time Ross Cunniff motioned for the City to use General Fund dollars to fulfill the agreement requirement.Bob Overbeck seconded the motion. Vote to approve motion: •Ross Cunniff—yes •Bob Overbeck yes •Mayor Karen Weitkunat no Mayor Weitkunat stated that she supports the staff recommendation and she would like both scenarios brought to City Council for discussion. Financial Comparative Data Mike Beckstead provided Front Range financial comparison information to the committee.The 2014 financial ratio study for municipalities was conducted by RubinBrown LLP;Accounting Services in Denver,CO. City ofFortCoLLins The information was collected from 32 Front Range communities with an average population of 76,000. Comparisons include: •Liquidity Ratios •Debt to Asset Ratios •Tax Revenue Ratios •Government Wide Expense Ratios •Debt Service Expenditure Ratios •General Fund Ratios Mike stated that Fort Collins is in the first or second quartile on many of the financial ratios and in the middle to third quartile on revenues and spending per capita.He shared his interpretation of the study that illustrates the citizens of Fort Collins want and expect a higher point of service.With citizen satisfaction deemed high,Fort Collins citizens also share their willingness to fund the desired levels of service as well. The study reflects for Fort Collins a conservative use of debt,a recovering economy in 2013 that also improved its net position,and MAX grants plus capital spending that influenced several ratios. Mike stated that the City will continue its participation in future surveys.It validates good financial practices. Mayor Weitkunat requested a one-page summary of this information to City Council. Darin Atteberry would like to pursue the possibility that RubinBrown will attend and present information to the Regional Manager meetings in Colorado. Meeting Adiourned