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HomeMy WebLinkAboutMinutes - Finance Committee - 09/16/2013 -_____C .Finance Administration_____I 0 215N Mason—a I I FloorI-Ort CoLLins Fort Coil ns,CO 80522 970.221.6788 97th 221.6782 fax Council Audit &Finance Committee Minutes 9/16/13 10:00 to 12:00 CIC Room Council Attendees:Mayor Karen Weitkunat,Bob Overbeck Staff:Timothy Allen,Darin Atteberry,Mike Beckstead,Megan Bolin,Steve Catanach,Chris Donegon,Brian Hergott,Brian Janonis,Tom Leeson,Ken Mannon,Lawrence Pollack,Wayne Sterler,Lance Smith,Steve Roy, John Voss,Katie Wiggett Others:Dale Adamy,Douglas Donne,Daniel Parsons, Allen Shuman Approval of the Minutes Mayor Karen Weitkunat moved to approve the minutes for the August 18 meeting.Bob Overbeck seconded the motion.Minutes approved unanimously. Block 32 Master Plan Review Darin Atteberry explained that several years ago,Council allocated funds for improving the 700 Wood Street facility.Before spending the funds,Utilities realized that a new building on Block 32 would better solve long-term needs.The City of Fort Collins teamed up with RNL Design to look at a master plan for Block 32 and see how it can be developed and where a new Customer Service Building might be located on this block.As a Utility Customer Service Building would be the first of several improvements to Block 32,it is necessary to have a plan for Block 32 before beginning construction on the new Utility building. RNL has developed several possible designs that incorporate the City’s vision,mission and values and support a long term vision for the City. Brian Janonis explained that 700 Wood Street is an older building that is actually several buildings which have been combined into one over the past 30 years.The resulting facility is one of the least energy efficient buildings the City owns.Substantial improvements are necessary to address the inefficiencies. An evaluation of the costs associated with these improvements and the necessary addition revealed that it is a better long term investment to construct a new building and renovate a portion of the existing vs. a full renovation and addition to 700 Wood Street. Councilmember Bob Overbeck and Mayor Weitkunat asked several questions about the proposed plans for Block 32.While Ken was able to present 3 rough sketches,more detailed and readable plans will be necessary for a Council discussion and decision. 0 ~Eo~Cci~~s The mayor noted that the first thing Staff needed to look at was how it messages this project to Council and the public.Staff needs to present the need and show how this will be a positive thing for staff and citizens.Staff should be focusing on social benefit of providing public service in a convenient location. Utility Building/Financing Lance Smith led a discussion on how a new Utilities Customer Service and Administration building would be financed.Staff recommends a revenue bond to finance this project. Preliminary discussions have resulted in the recommendation that the revenue bond be issued out of one utility fund rather than having four separate,smaller revenue bonds coming to market at once. Because the Light &Power Enterprise Fund is the largest utility fund,and it has debt capacity in excess of $50M,it is the recommended utility fund.The other three utility funds would make annual transfers to cover their portion of the debt repayment.This issuance will be for $15.5M,leaving more than $35M in debt capacity.The only identified potential need for future debt issuance in the Light &Power Fund is for the Mulberry Annexation which is several years into the future and is expected to be $10-15M. In addition to the new building,this debt issuance would also allow for the renovation of existing space at 700 Wood Street to meet growing operational needs.Together,the construction of the new building and the renovation of the existing building are expected to cost $20M.Currently,the Light &Power Fund has $4.5M in Reserves for this effort,leaving a need for $15.SM to be financed. The new building would initially have unused space for the Utilities to grow into in the future.The City’s Sustainability Services department could utilize this space through a lease arrangement which would provide some revenue toward the debt obligation.Incremental revenues from expiring and new service agreements are sufficient to cover debt obligations.This is significant because it means we should not have to adjust utility rates to finance these improvements. Utilities is seeking guidance on whether Council wants Fort Collins Utilities to continue to study and design this new building and bring forth a bond ordinance to the Electric Utility Enterprise Board and an appropriation request to City Council in early 2014 for this project.Construction could begin as soon as May 2014 so it will be necessary to bring the bond ordinance before the City Council and Electric Utility Enterprise Board in early 2014 for action.Lance presented an estimated timeline that included several boards that would be consulted.The Mayor asked that the Parks board be added to the list.Darin asked that Utilities also bring the information to the DDA. The Mayor again emphasized the need for public outreach that emphasizes the social good of this project.Darin noted that this improvement is part of moving toward Utilities of the 2ft Century.It’s an important,significant improvement for the community.It will also be a great boon for downtown businesses as it will bring 135 more City employees to the downtown area. The Mayor asked if a 25 year plan is adequate and appropriate.Darin noted that this would be similar to the Police Building plan.Ken Mannon agreed that a 50 year plan may be better and he will look into what a 50 year plan would look like and whether it would be possible. Clean-up Memo Going to Council —Questions? Lawrence Pollack asked if Council Finance had any questions concerning the 2013 Clean-up Ordinance that is going to City Council for 1~reading on October 1,2013.Bob Overbeck noted that he would like it City ofFortCoLLins to be clearer whether the allocation for Cable 14 also includes Chanel 97.Mike Beckstead said that he will look into the specifics of what was being asked for.The Mayor asked whether No.A.5 and No.C.2 are actually the same monies.Lawrence confirmed that they are and this will be corrected before first reading. Next Steps Staff will redesign the presentation of the Block 32 Master Plan to better speak to the social side of the project. Staff will bring the Clean up Ordinance to Council on October 1,2013.