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Council Finance Committee
Minutes
09/15/08
10:30 a.m -12:00 p.m.
Council Attendees:Mayor Doug Hutchinson,Councilmember Ben
ManveL,Councilmember Kelly OhLson
City Staff Attendees:Darin Atteberry,Kraig Ecton,Mike Freeman,
Chuck Seest,Heather Shepherd,John Voss
Others:Ann Hutchinson from the Chamber of Commerce;
Julia Stone from Bondi &Co.,LLC
Approval of the Minutes from the August 30th meeting.
Minutes were approved.
Briefing on Refunding of water bonds
Chuck gave an update to the Committee regarding the 1998 Water Bonds that are now
approaching their 10 year call date and are eLigibLe for refunding.According to James
Capital,the City’s financial advisor,the refunding of the $18.6 million of bonds would
result in net savings of approximately $1 .0-Si .2 million for the water utility based on
market conditions as of September 10th•
The Committee agreed that an ordinance approving the refunding transaction should
be presented at the regular City Council Meeting on October 7,2008.
Discussion of Tax Increment Methodologies.
Ben summarized the process to validate his understanding of the tax increment
methods for the DDA and URA.Chuck reviewed flow charts illustrating the overall
process of the Tax Assessor for valuing all parcels in the County and the process for
the Allocation of a portion of that value to Tax Increment Funding Entities.
Delivery of CAFR and Audit Report to Governance from BONDI
Julia Stone,partner from Bondi and Co.,LLC,stated that Bondi’s opinion for the
City’s financial statements was ‘unqualified’which is the best an organization can
receive.Additionally,there were no findings related to the City’s expenditure of
Federal dollars.The auditors didn’t post any audit adjustments to the financial
statements this year.
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There were no big changes in accounting policies or estimates or disclosures.
With regard to the ‘continuing items’in listed in Bondi’s report,Kelly asked if
‘continuing’means from one year previous,or more?
Julia responded these are from last year’s report,but last year’s report contained
items from a couple prior years.
Darin asked Chuck to report on the status or developments of the item regarding
federal and state grants,for which the City’s response was ‘we agree’.Darin wanted
to know how City staff is tracking it and how ft’s reported when completed.Chuck
said one way was to receive reports on these items from each department during the
regular Finance and Budget Liaison meetings.Darin asked if the departments know
that reporting regularly is a requirement.Chuck said they do know but it has been a
‘mixed bag’in the past.Finance will work on communication to improve this process
going forward,particularly in light of the significant federal grant funding the City is
scheduled to receive for the Mason Corridor Project.
The Mayor presented an award of appreciation to Bondi &Co.,LLC,for their service
over the last 15 years.
2009 Budget Exception Discussion
Darin said this is the middle of the two year budget cycle and City departments have
a few exception items that will be coming to Council in October for approval by the
charter deadline at the end of November.
Darin asked for thoughts specifically on the homeLessness initiative.He’d Like to
dedicate some ‘seed money’of up to $100,000 and give it to the appropriate entity in
the community to administer/facilitate it.He said it helps leverage other resources
within the community.
Mike stated that for 2010-2011 the Finance staff is projecting approximately a 2.5%
revenue growth.Mike has given a recommendation to Darin that the City try to retain
about $5 million in savings at the end of 2009 so it can be drawn upon to supplement
the budget in 2010 and 2011.
Darin pointed out the PILOT program for Police Services that currently places a
Larimer County Assistant District Attorney at Police Headquarters has been working
well.Darin believes this arrangement will be a strong benefit to the community.
Ben asked why these are exceptions only for 2009 (like fuel costs)and Mike said that
it will also be in 2010 and 2011 but this document shows only adjustments to the 2009
budget.
At 11:30 Darin and Doug had to leave for another meeting.
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Tax Increment DDA and URA methodologies
Kelly asked about the tax increment using an example in which the same owner has
owned a building for many years but has made no improvements and the building
existed before the DDA was in place.How can the property tax go from $10,000 to
$50,000;and does the DDA receive any of that increase in property taxes?
Ben summarized that the proportion of money (that the DDA gets)stays the same,If
the DDA share is half,for example,it wilt always be half no matter how much the
property taxes have gone up.However,if any improvements are made to the
building,then 100 percent of the improvements go to the DDA that year and in all
future years until the DDA no longer exists.
Meeting adjourned at 12:00