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MINUTES-03/06/2007-Regular
March 6, 2007 COUNCIL OF THE CITY OF FORT COLLINS, COLORADO Council -Manager Form of Government Regular Meeting - 6:00 p.m. A regular meeting of the Council of the City of Fort Collins was held on Tuesday, March 6, 2007, at 6:00 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll Call was answered by the following Councilmembers: Brown, Hutchinson, Kastein, Manvel, Ohlson, Roy and Weitkunat. Staff Members Present: Jones, Krajicek, Roy. Citizen Participation David May, Fort Collins Area Chamber of Commerce, representing the Northern Colorado Legislative Alliance of the Greeley, Loveland and Fort Collins Chambers of Commerce, stated the Legislative Alliance had made improving the transportation system a priority. A letter had been sent to the City Council regarding the level of Council support for a RTA and specific regional transportation projects. Pete Seel, 1837 Scarborough Drive, Rolland Moore West Neighborhood Network, spoke regarding the canal importation stormwater development project that would be discussed by Council at an upcoming work session. The Neighborhood Network was concerned about the impact of this major project on the neighborhood and the natural and wetlands areas. Lloyd Walker, 1756 Concord Drive, Rolland Moore Neighborhood Network, spoke regarding the canal importation project and the potential impact on the stormwater and natural areas of Red Fox Meadows. The neighborhood would like to see this project handled in a "sensitive fashion" and would like to have an opportunity to engage in improvements or maintenance through a volunteer "Friends of Red Fox Meadows" group. Seth Anthony, West Prospect Road resident, spoke regarding the proposed new urban renewal authority that would help replace the tax increment financing revenue that the DDA would lose when that expires in a few years. An urban renewal authority would have power beyond tax increment financing, such as the power of eminent domain. He questioned whether this was the intent of the City and urged the Council to state the tax increment financing purpose of the urban renewal authority and forego the "unnecessary powers" of eminent domain allowed by State law. Item #18 on the Consent Calendar was initiation of eminent domain proceedings for 90 square feet ofproperty for the Ziegler/Kechter roundabout. The eminent domain power should not be "used lightly." When it was used the cost should be explained openly. Vivian Armendariz, 820 Merganser Drive, thanked Council for extending Dial -a -Ride night service. She also thanked Council candidate Matt Fries for developing a Dial -a -Ride plan. 234 March 6, 2007 Citizen Participation Follow-up Mayor Hutchinson thanked those who spoke during Citizen participation. He noted the City was sensitive to the Red Fox Meadows situation and the City's goals matched the goals of the citizens. Councilmember Kastein thanked the Northern Colorado Legislative Alliance for the study on the level of legislative support for transportation. The data collected would be used by the RTA Steering Committee. Agenda Review Deputy City Manager Jones stated there were no changes to the published agenda. CONSENT CALENDAR 6. Consideration and Approval of the Minutes of the November 21 2006 and December 5 2006 Regular Meetings and the Adioumed Meeting of November 28 2006 7. Second Reading of Ordinance No 031 2007 Appropriating Prior Year Reserves in the Natural Areas Fund for the PmMose of Providing Natural Areas Programming Not Included in the 2007 Adopted City Budget This Ordinance, unanimously adopted on First Reading on February 20, 2007, appropriates prior year reserves in the Natural Areas Fund. The purpose of the previously appropriated funds remains the same, that being for land conservation, construction ofparking lots, fences and trails, restoration of wildlife habitat and other natural areas program needs to benefit the citizens of Fort Collins. 8. Second Reading of Ordinance No 032 2007 Appropriating Prior Year Reserves Ordinance No. 032, 2007, was unanimously adopted on First Reading on February 20, 2007. The Ordinance appropriates prior year's reserves for expenditures authorized in 2006 by Council but which could not be completed by the end of 2006. 9. Second Reading of Ordinance No 033 2007 Appropriating Unanticipated Revenue in the Transportation Services Fund and Authorizing the Transfer of Existing Appropriations in the Transportation Services Fund and the General Fund to Be Used for the Design and Construction of East Mountain Trolley Track Enhancements This Ordinance, unanimously adopted on First Reading on February 20, 2007, appropriates revenue received from a grant from the North Front Range Metropolitan Planning Organization Transportation Enhancement Grant Program. This grant will be used to restore the brick roadbed surrounding the exposed, abandoned, streetcar railway track. The restoration will bean asset to the adjacent Old Town National/State/Local Landmark District, and provide safe pedestrian/bicycle passage. 235 March 6, 2007 10. Second Reading of Ordinance No 034 2007 Amending Section 23.5 of the City Code Pertaining to Special Events This Ordinance, which was unanimously adopted on First Reading on February 20, 2007 amends the City Code to make the special event application process friendlier to the citizens applying for permits. 11, Items Relating to the Weiner Enclave Annexation A. Second Reading of Ordinance No. 035, 2007, Annexing Property Known as the Weiner Enclave Annexation to the City of Fort Collins, Colorado B. Second Reading of Ordinance No. 036, 2007, Amending the Zoning Map of the City of Fort Collins and Classifying for Zoning Purposes the Property Included in the Weiner Enclave Annexation to the City of Fort Collins, Colorado. These Ordinances, unanimously adopted on First Reading on February 20, 2007, annex and zone 7.55 acres located on the west side of Ziegler Road, south of Rock Creek Drive, and north of Kechter Road. Fossil Ridge High School is directly to the east. This annexation request consists of two properties (5117 Ziegler Road and 5305 Ziegler Road) that are developed as single-family residences with several outbuildings. The property at 5117 Ziegler Road contains an existing livestock feedlot (not operating) and the property at 5305 Ziegler Road contains a commercial business (Express Concrete). The McClelland's Channel runs along the south property line of 5305 Ziegler Road. The properties are in the FA 1 - Farming Zoning District in Larimer County. The requested zoning in the City of Fort Collins is LMN - Low Density Mixed -Use Neighborhood. 12. Items Relating to CDOT's Safe Routes to School Program. A. Resolution 2007-023 Authorizing the Execution ofan Intergovernmental Agreement Between the City and the Colorado Department of Transportation for the Widening of an Existing Sidewalk on the South Side of Mulberry Street from Dunn Elementary School to Shields Street. B. First Reading of Ordinance No. 038, 2007, Appropriating Unanticipated Revenue in the Capital Projects Fund - Pedestrian Plan Capital Project for Improvements Associated with the Safe Routes to School Program. The Safe Routes to School Program was designed to promote the safety and environmental conditions for students traveling to and from school. With the hope to increase the numbers of students walking or bicycling to school, this program uses the Four E's (Education, Enforcement, Engineering, and Encouragement) to provide a comprehensive approach to traffic safety problems around schools. 236 March 6, 2007 The City ofFort Collins Transportation Planning office received a grant from the CDOT Safe Routes to School Program for FY 2005-06 to widen the existing sidewalk along the south side of Mulberry Street from 2.5 feet to 6 feet, from Dunn Elementary to Shields Street. This widened sidewalk will greatly improve safety and connectivitybetween Dunn elementary and the surrounding neighborhoods. 13. First Reading of Ordinance No 039 2007 Appropriating Unanticipated Grant Revenue and Prior Year Reserves in the General Fund for the Restorative Justice Program. The Restorative Justice Program (the "Program") is an alternative method ofholding a young offender accountable by facilitating a meeting with the young offender, the victim and members of the community to determine the harm done by the crime, and what should be done to repair the harm. This Ordinance appropriates funds from two grants that have been received for the purpose of continuing this program. 14. First Reading of Ordinance No 040 2007 Amending Chapter 25 of the City Code to Create a Manufacturing Equipment Use Tax Rebate The Manufacturing Equipment Use Tax Rebate Program is an important economic incentive for retaining and supporting local manufacturers. Manufacturing concerns are a very important element of the City's tax base. They also serve as a primary engine for both job creation and commercial investment in the community. This Ordinance adds the Program to the City Code to ensure that the Program provides an important economic incentive on an ongoing basis. 15. First Reading of Ordinance No 041 2007 Authorizing the Execution and Delivery by the City of an Amended and Restated Site Agreement and Lease Agreement a Continuing Disclosure Undertaking an Official Statement and Related Documents Concernin the Leasing of the Mason Office Building and the Mason Street Parking Structure: Ratifying Action Previously Taken• and Providing Other Matters Adoption of this Ordinance will approve and authorize the legal documents necessary to complete a lease purchase certificate of participation transaction to effectively refund the 1998 and 1999 COPS that were originally issued for the construction of the City's Mason Street Parking Structure, the 215 North Mason Office Building and an off -site Police Facility. 16. First Reading of Ordinance No 042 2007 Authorizing the Lease of City Owned Property at 321 Maple Street For Up to Five Years The Fort Collins Technology Incubator (FCTI) provides critical business assistance to the most providing high tech startup companies in the community. As part of its service, FCTI offers below market lease space to its client companies. This Ordinance would allow FCTI's various participants to lease space for up to five years. 237 March 6, 2007 17. First Reading of Ordinance No 043 2007 Authorizing the Execution of Ouit Claim Deeds and a Temporary Construction Easement for the Improvement of North Taft Hill Road by Larimer County. Presently, Larimer County is improving North Taft Hill Road between LaPorte Avenue and the Poudre River. To accomplish this project, Larimer County is requesting that the City of Fort Collins dedicate the following property interests to Latimer County: a temporary construction easement on approximately 1,200 square feet in size on property in use by the City for its trail system; a Quit Claim Deed for approximately 428 square feet ofproperty acquired by the City for its trail system but no longer needed, for new right-of-way on the west side of Taft Hill Road; and, 3. a Quit Claim Deed of approximately 4,400 square feet of property, which was acquired by the City as a consequence of the dissolution of the LaPorte Water and Sanitation District in 2006, subject to a perpetual utility easement by the City, also located on the west side of Taft Hill Road. 18. First Reading of Ordinance No. 044 2007 Authoriziniz the Acquisition by Eminent Domain Proceedings of Certain Lands Necessary for the Construction of Public Improvements in Connection with the Street Oversizing Ziegler and Kechter hitersection Project. Intersection improvements were constructed for Ziegler Road and Kechter Road. These improvements included the construction of a modern roundabout at the Ziegler and Kechter intersection. Because of the round configuration of the improvements and the square shape of the existing right of way, two small slivers of property are needed on the west side. One of these properties has been purchased. Over the past year, staff has been in negotiations with the other owner, Hearthside Homeowners Association of Fort Collins, Inc., and has not been successful in reaching a mutually satisfactory agreement. An eminent domain authorization is being proposed for consideration by Council if an agreement cannot be reached. 19. Resolution 2007-024 Authorizing an Intergovernmental Agreement with Colorado State University to Establish the University's Public Water System as a Consecutive System Within the City's Integrated Public Water System Colorado State University (CSU) owns and operates a public water system that distributes water supplied by the City. The Water Quality Control Division of the Colorado Department of Public Health and Environment (CDPHE) has determined the University's system to be a consecutive public water system and therefore subject to Colorado drinking water regulations. 238 March 6, 2007 As public water systems, CSU and the City may either meet the requirements of the regulations as individual entities or enter into an integrated systems agreement and share responsibilities. The proposed intergovernmental agreement establishes CSU as part of the City's integrated public water system and delineates responsibilities for applicable drinking water regulations. 20. Resolution 2007-015 Convening a Task Force to Update the City of Fort Collins Climate Protection Plan and to Promote Renewable Energy EnergEfficiency, Waste Reduction and Transportation -related Technologies Services and Practices In 1999, City Council adopted Resolution 1999-137, setting a goal to reduce citywide greenhouse gas emissions 30% below worst case 2010 levels, by 2010, and adopting a Plan to meet the goal. The most recent progress report (2004) indicates the City is not on track to meet the 2010 reduction goal. This Resolution calls for the formation of a task force, including citizens and City staff, to develop an updated plan to describe the steps the community will take to meet the existing greenhouse gas goal. It directs that the revised Plan shall include measures to encourage renewable energy, energy efficiency, transportation efficiency, and waste reduction. It also allows the task force to make recommendations on how the City should develop a future direction for climate protection after 2010. 21. Routine Easements. A. Easement for construction and maintenance ofpublic utilities from Fort Collins Bible Church, to underground electric system underground, located at 2550 South Taft Hill. Monetary consideration: $4886. (See Map #1). B. Easement for construction and maintenance ofpublic utilities from Fort Collins Bible Church, to install new pad mount electric switch gear, located at 2550 South Taft Hill. Monetary consideration: $505.68. (See Map #2). ***END CONSENT*** Ordinances on Second Reading were read by title by City Clerk Krajicek. 7. Second Reading of Ordinance No. 031, 2007 Appropriating Prior Year Reserves in the Natural Areas Fund for the Purpose of Providing Natural Areas Programming Not Included in the 2007 Adopted City Budget. 8. Second Reading of Ordinance No. 032, 2007, Appropriating Prior Year Reserves, 9. Second Reading of Ordinance No. 033, 2007, Appropriating Unanticipated Revenue in the Transportation Services Fund and Authorizing the Transfer of Existing Appropriations in the Transportation Services Fund and the General Fund to Be Used for the Design and Construction of East Mountain Trolley Track Enhancements. 239 March 6, 2007 10. Second Reading of Ordinance No. 034, 2007, Amending Section 23.5 of the City Code Pertaining to Special Events. H. Items Relating to the Weiner Enclave Annexation. A. Second Reading of Ordinance No. 035, 2007, Annexing Property Known as the Weiner Enclave Annexation to the City of Fort Collins, Colorado B. Second Reading of Ordinance No. 036, 2007, Amending the Zoning Map of the City of Fort Collins and Classifying for Zoning Purposes the Property Included in the Weiner Enclave Annexation to the City of Fort Collins, Colorado. Ordinances on First Reading were read by title by City Clerk Krajicek. 12. First Reading of Ordinance No. 038, 2007, Appropriating Unanticipated Revenue in the Capital Projects Fund - Pedestrian Plan Capital Project for Improvements Associated with the Safe Routes to School Program. 13. First Reading of Ordinance No. 039, 2007, Appropriating Unanticipated Grant Revenue and Prior Year Reserves in the General Fund for the Restorative Justice Program. 14. First Reading of Ordinance No. 040, 2007, Amending Chapter 25 of the CityCode to Create a Manufacturing Equipment Use Tax Rebate. 15. First Reading of Ordinance No. 041, 2007, Authorizing the Execution and Delivery by the City of an Amended and Restated Site Agreement and Lease Agreement, a Continuing Disclosure Undertaking, an Official Statement, and Related Documents, Concerning the Leasing of the Mason Office Building and the Mason Street Parking Structure; Ratifying Action Previously Taken; and Providing Other Matters. 16. First Reading of Ordinance No. 042, 2007, Authorizing the Lease of City -Owned Property at 321 Maple Street For Up to Five Years. 17. First Reading of Ordinance No. 043, 2007, Authorizing the Execution of Quit Claim Deeds and a Temporary Construction Easement for the Improvement of North Taft Hill Road by Larimer County. 18. First Reading of Ordinance No. 044, 2007, Authorizing the Acquisition by Eminent Domain Proceedings of Certain Lands Necessary for the Construction of Public Improvements in Connection with the Street Oversizing Ziegler and Kechter Intersection Project. 26. First Reading of Ordinance No. 037, 2007, Appropriating Prior Year Reserves Designated for Library Improvements in the Capital Improvement Expansion Fund for Transfer to the City's Capital Projects Fund to Construct a Southeast Branch Library and the General Fund to Purchase Library Books and Materials. 240 March 6, 2007 28. First Reading of Ordinance No. 045, 2007, Establishing Local Sanctions Upon Contractors and Subcontractors of the City Who Employ Unauthorized Aliens to Perform Work for the City. Councilmember Manvel made a motion, seconded by Councilmember Roy, to adopt and approve all items on the Consent Calendar. Yeas: Councilmembers Brown, Hutchinson, Kastein, Manvel, Ohlson, Roy and Weitkunat. Nays: None. THE MOTION CARRIED. Consent Calendar Follow-up Mayor Hutchinson commented on item #15 First Reading of Ordinance No. 041, 2007, Authorizing the Execution and Delivery by the City of an Amended and Restated Site Agreement and Lease Agreement, a Continuing Disclosure Undertaking, an Official Statement, and Related Documents, Concerning the Leasing of the Mason Office Building and the Mason Street Parking Structure; Ratifying Action Previously Taken; and Providing Other Matters. Councilmember Ohlson commented regarding item #14 First Reading of Ordinance No. 040, 2007, Amending Chapter 25 of the City Code to Create a Manufacturing Equipment Use Tax Rebate and item #20 Resolution 2007-015 Convening a Task Force to Update the City of Fort Collins Climate Protection Plan and to Promote Renewable Energy, Energy Efficiency, Waste Reduction and Transportation -related Technologies, Services, and Practices. Councilmember Kastein spoke regarding item #14 First Reading of Ordinance No. 040, 2007, Amending Chapter 25 of the City Code to Create a Manufacturing Equipment Use Tax Rebate and item #18 First Reading of Ordinance No. 044, 2007, Authorizing the Acquisition by Eminent Domain Proceedings of Certain Lands Necessaryfor the Construction of Public Improvements in Connection with the Street Oversizing Ziegler and Kechter Intersection Project. Councilmember Manvel commented on item #13 First Reading of Ordinance No. 039, 2007, Appropriating Unanticipated Grant Revenue and Prior Year Reserves in the General Fund for the Restorative Justice Program. Councilmember Roy commented regarding item #12 First Reading of Ordinance No. 038, 2007, Appropriating Unanticipated Revenue in the Capital Projects Fund - Pedestrian Plan Capital Project for Improvements Associated with the Safe Routes to School Program. Councilmember Reports Councilmember Weitkunat reported on Poudre Fire Authority Board of Directors discussions regarding the need to meeting with the City Council at least once per year, the new fire station in Timnath and the budgeting for outcomes process. 241 March 6, 2007 Councilmember Kastein reported on DDA discussions regarding the consolidation of newsracks in the Old Town area. He also reported on MPO discussions regarding the funding of a Regional Transportation Authority and a citizen driven task force for the effort. Mayor Hutchinson stated he represented the City on a panel session on energy saving initiatives and natural resource management and policies at the Metro Mayors Conference. Resolution 2007-025 Urging the Registered Electors of the City Not to Support the Repeal of Ordinance No. 137, 2006, Which Annexes Properly Known as the Southwest Enclave Annexation Adopted. The following is staffs memorandum on this item. "EXECUTIVE SUMMARY On October 3, 2006 the City Council adopted on Second Reading, an ordinance annexing the Southwest Enclave to the City of Fort Collins. This ordinance was adopted following a two year process that involved numerous meetings with area residents and business owners, and adoption of a number of Code amendments that will mitigate impacts on enclave residents. Following adoption of the annexation ordinance, a referendum petition was filed seeking to repeal the ordinance. Thepetition was certified to the City Council on December 19, 2006 and the Council decided to refer the ordinance to a vote of the registered electors at the next regular municipal election, scheduledfor April 3, 2007. This Resolution describes reasons for the Southwest Enclave annexation and urges registered electors to not support the repeal of the annexation by voting "no " on the ballot measure. BACKGROUND The City of Fort Collins and Larimer County entered into an Intergovernmental Agreement (IGA) in the early 1980s that outlined the eventual city limits for Fort Collins and contained a clause that obligates the City to pursue annexation of enclaves as they occur. Larimer County is not equipped to provide urban -level services, nor does it make sense to have a "checkerboard "pattern of urban and rural development within the boundaries of a municipality. People who live near the city also benefit from City services and it makes sense that they help pay for these services. For all these reasons, the City has remained committed to this agreement and regularly annexes enclaves as they are formed. Fort Collins continues to grow at a steady pace and has surrounded the Southwest Enclave over time. The annexation in 2001 of City -owned open space on the west side of Fort Collins closed the final border, forming the enclave. The Southwest Enclave is larger than most with a population of nearly 3,100 and a total landmass of 2.7 square miles. 242 March 6, 2007 This has been a contentious issue for many enclave residents. Between 2004 and 2006 the City held more than 16 neighborhood forums in the area to explain the City's intent to annex and to hear concerns from enclave residents and business owners. After hearing those concerns, Council reiterated its commitment to providing the same high level of services to residents and property owners within the Enclave that it provides to those who reside in other parts of the City. Council subsequently adopted a series of mitigation measures, including: 1. Using reserve funds to cover all except 5% of the 25% mandated service rights fee for current Poudre Valley Rural Electric Authority customers. 2. Undergrounding electric utilities at no cost to property owners. 3. Phasing in monthly stormwater utilityfees over a five year period. 4. Allowing barbed wire fences and electrically charged fences used for livestock and pasture management in UE and RUL zones. 5. Changing the amortization period to 7 years for nonconforming permanent signs. 6. Changing the licensing and record -keeping requirements for secondhand dealers/flea markets so as not to put an undue burden on individual booth operators. A number of citizens in the enclave have repeatedly stated they do not have a voice in the annexation issue. Enclave residents continue to be represented in this issue by the Larimer County Commissioners and they communicate regularly with Commissioners, City staffand City Council members. The mitigation measures area direct result of many of those conversations. For all of the above stated reasons City staff believes that the annexation of the Southwest Enclave is in the best interests of the City and recommends that Council adopt the Resolution, which urges City electors to vote "no" on the ballot measure. " Deputy City Manager Jones stated the Resolution would urge voters to vote "no" on the Southwest Enclave Annexation measure on the April ballot. Cameron Gloss, Current Planning Director, presented background information on the Southwest Enclave Annexation, the extensive outreach that had taken place, and mitigation measures that would be done to mitigate the impacts of the annexations to the residents and businesses in the area. He stated City electric rates would be substantially lower than REA rates for the area. Deputy City Manager Jones stated the Council had decided to refer the ordinance to a vote of the people after receiving a referendum petition. She stated this Resolution would urge a "no" vote on the measure. Mayor Hutchinson stated each audience participant would have five minutes to speak. Marty Tharp, 601 Birky Place, spoke in support of the Resolution. She expressed concern that the wording of the ballot measure could be confusing to voters i.e., it would be necessary to vote "no" to approve the annexation. 243 March 6, 2007 Karen Rose, 5200 Parkway Circle East, Southwest Enclave Annexation representative, stated the people of the annexation area gave everyone in the City the right to vote on this issue. This matter was all about "power" and "rights." Those in the annexation would be forced to pay 5% more for electricity that they would not receive for 10 years. The City had fees (stormwater, parks, etc.) on the utility bills that were not charged by REA. A vote to adopt this Resolution would be a "denial of the founding principles of this nation" and would "set a precedent' by phased annexation of an area that would deny the new City residents the right to vote on the Councilmembers and the City issues for 10 years. Sandy Robbins, 5801 South Shields Street, stated area input from "activists" had not been heard by the City. Private funds had been raised to "continue this fight' because the annexation was "unjust." The mitigation efforts would not have happened without the work of the activists. Open space was used to create the Enclave in an area that did not depend on City services. She and other area residents contributed to the City as volunteers. The people of the Enclave were being "denied a choice" to continue to be County residents and open space had been used in a way it was never intended to be used. Seth Anthony, West Prospect Road resident, stated he would vote "yes" to repeal the annexation. This was a "non -binding resolution" that used taxpayer time and resources to "tell citizens how to vote." Councilmember Kastein asked staff to explain the fee for the transfer from REA to City electric service. Gloss stated, as required by State law, the City would collect a 25% service rights fee that would be passed along to Poudre Valley REA. The proposed mitigation measure would provide that the City would cover 20% of the 25% fee. Councilmember Kastein asked if the City could decide not to charge the fee. Gloss stated the City was required to collect that fee and pass it along to REA. Councilmember Manvel stated he understood this fee was charged when someone moved from one utility service to another to account for the investment made by the utility to provide service. He stated the City would pay four -fifths of the fee in this case, the enclave residents would pay one -fifth, and the REA would get the money. Gloss stated that was correct. Councilmember Kastein asked Ms. Rose to address the issue of this fee. Ms. Rose stated the statute provided that REA must be reimbursed for the lost customers at the rate of 25% for 10 years. The statute did not provide how the City would get that funding i.e., it did not specify that it would come from the REA customers or other utility customers such as gas customers. Other cities had made different choices to totally cover the cost in the case of forced annexation. Councilmember Kastein stated the 5% that would be passed along to the customer would still mean a lower electric rate in every case than the rate before the annexation. He asked staff to comment on whether a forced annexation was "unprecedented." Gloss stated the citizen comment was that a phased approach to an enclave annexation was unprecedented. There had been phased annexations in other communities and that the City had annexed enclaves in the past. 244 March 6, 2007 Councilmember Kastein asked if involuntary annexations occurred elsewhere. City Attorney Roy stated annexations took place by reason of contiguity pursuant to a petition or after an enclave area had been entirely surrounded by the City for a minimum of three years. This was an enclave annexation and that such annexations were done "fairly routinely" around the state. Phased annexations were not done routinely but were permitted by the State statute because the annexation did not take effect until the annexation plat was recorded with the County. The City could annex the entire Enclave as a whole. The Resolution related to the matter of whether the voters wanted to repeal the phased annexation. The Council chose to bring the annexation into the City in phases because of the size of the annexation and because doing it all at once would make it more difficult to provide the necessary services. Once each phase became part of the City, those people would acquire the right to vote. People in the County did not have the right to vote as City residents. Mayor Hutchinson noted that County residents were represented by the County, which had a partnership in this process with the City. City Attorney Roy stated the County Commissioners were a party to the Intergovernmental Agreement pursuant to which the Enclave was annexed. Mayor Hutchinson stated outreach was done before this annexation because of the City's intent to mitigate the impacts and problems that people brought up. He stated some "unusual things" were done because this was an unusually large annexation. It was necessary to look at the "real result" of annexation on electric bills. It would cost 15% less overall for electricity. The City was mitigating the fee to be paid to REA to ensure a reduction in the average residential electric bill. Gloss stated this was correct. Councilmember Manvel stated Enclave residents would pay a stormwater fee that they were not currently paying. He asked staff to explain how City stormwater fees worked. Gloss stated the City did not charge separately for each basin and that the stormwater utility fee went toward regional improvements and maintenance of stormwater facilities throughout Fort Collins. The costs were spread among all City residents. Councilmember Weitkunat made a motion, seconded by Councilmember Manvel, to adopt Resolution 2007-025. Councilmember Roy stated the Southwest Enclave was already"within the City of Fort Collins." The election would help determine whether or not it would be "part of the City of Fort Collins." Annexation would answer the questions about representation and would facilitate a "higher level of land use" for the City and County. It was important for City residents to understand why this was an enclave and how it sat within the City boundaries. Mayor Hutchinson stated the Council had asked staff to determine the length of the boundary shared between the City limits and the enclave i.e., how long that boundary was. Gloss stated the contiguous boundary was about three miles in length and that the "perimeter" was about 18 linear miles where the boundaries touched. Councilmember Weitkunat stated there was a need to be "cautious" about using terminology such as "forced annexation" or "involuntary annexation." Annexation was a tool used by a city to build 245 March 6, 2007 and design a community and manage growth. Annexation was a method to manage how the City grows. The question was whether an area that was "totally engulfed" by a city should remain in the County's jurisdiction. The City was willing to take in the property in the interest of"good growth." She urged the voters to understand what annexation meant in community development. This was the Southwest Enclave Annexation and the question was whether it should be part of the community or not. Councilmember Manvel stated some speakers expressed a concern that this decision was not in their hands. There were 3,000 Enclave residents and 140,000 Fort Collins residents. The question was who should decide what the "shape of Fort Collins" should be. This area was "in Fort Collins" and the residents were enjoying City amenities such as open space. The question was whether those residents should be governed by the City of Fort Collins and pay the same fees and taxes and obey the same rules as City residents. He believed that the answer was "clearly yes." The phasing was in place because of the cost to the City and that every year of delay would mean more cost. This was the time for annexation and encouraged voters to determine that the area should be part of the City. He urged voters not to repeal the annexation. Councilmember Brown stated the City had "bent over backwards" to do everything possible. He voted no on the annexation because he felt that the phased annexation did not give the people the right to vote. He would vote against the motion. Councilmember Kastein stated it was "proper and appropriate" for the Council to take a position on this ballot issue. The City/County intergovernmental agreement was that the County would maintain rural level services and the City would maintain urban level services. Over time the City had expanded and the County's area had "shrunk." This meant that the City had expanded its services to support a larger area. This was about "efficiency of government." Tax dollars should not go to both entities for the same services. The phased annexation approach was necessary because of budget constraints. It was more efficient for the City to annex this property so that it could become part of the urban planning boundaries. Mayor Hutchinson stated he had "pushed hard" to do some unprecedented mitigation of some of the problems because of the "unusual situation." It was not possible to give County residents the right to vote in a City election. The process that had been followed had been used for over three decades to build the City. He stated he would support the motion. The vote on the motion was as follows: Yeas: Councilmembers Hutchinson, Kastein, Manvel, Roy and Weitkunat. Nays: Councilmembers Brown and Ohlson. THE MOTION CARRIED Items Relating to the Southeast Branch Library Adopted The following is staff s memorandum on this item. 246 March 6, 2007 "FINANCIAL IMPACT Approximately $5.8 million is available from library capital improvement expansion fees collected from new residential construction in Fort Collins since 1996. These fees are collected to pay for the impact ofgrowth on the quality of library services. Funds must be spent within a reasonable time of collection (approximately 10 years) to provide library materials or facilities. Staff anticipates construction and furnishings, including the library's collection, will cost about $5.5 million. Recent ballot language authorized the newly formed library district to operate a southeast branch library once it is constructed. The annual operating budget would be approximately $750, 000 - $1,200,000 depending on the level ofstaffing needed. EXECUTIVE SUMMARY A. Resolution 2007-020 Authorizing an Exemption to the Competitive Process for the City to Enter into a Contract with Bayer Properties for the Construction of the Southeast Branch Library. B. Resolution 2007-021 Authorizing an Exemption to the Competitive Process for the City to Enter into a Contract with Aller-Lingle Architects to Complete Architectural Services ofthe Design and Construction Phases of the Southeast Branch Library. C First Reading of Ordinance No. 037, 2007, Appropriating Prior Year Reserves Designated for Library Improvements in the Capital Improvement Expansion Fund for Transfer to the City's Capital Projects Fund to Construct a Southeast Branch Library and the General Fund to Purchase Library Books and Materials. Resolution 2007-020 will allow the City to coordinate construction of the Southeast Branch Library at Front Range Village with Bayer Properties. Resolution 2007-021 authorizes a contract with Aller-Lingle Architects, already under a City purchasing contract, to provide comprehensive architectural services through the design and construction phases of the project. Ordinance No. 037, 2007, appropriates available library impact fees to pay for the design and construction of the Library and the collection. BACKGROUND The City is working with Bayer Properties to include a 16,000 square foot library in the Front Range Village development. The library will be located on the second floor of an attractive, centrally located building. The library will be owned by the City and will provide convenient and much needed library services for the community. 247 March 6, 2007 Area voters recently approved the new library district, including new funds to pay for the operation of the SE Branch Library. Existing funds collected from impact fees are sufficient to pay for the construction and furnishing of a 16,000 square foot branch. This branch will helpmeet the goals identified in the Library Capital Improvement Plan offour books per capita and, 7 square feet per capita of library space by 2015. The library is currently at 2.56 books per capita and. 4 square feet per capita. Resolution 2007-020 Bayer Properties has retained a construction contractor for all the buildings in the Front Range Village development, including the core and shell of the building the library will occupy. By coordinating the construction of the library core and shell through Bayer, the City will realize efficiencies, benefit from economies of scale and expedite the completion of the library. The core and shell includes the foundation, walls, roof and associated elements of the building. Because Bayer's contractor will be constructing the first floor core and shell, it would be difficult and inefficient to bring in a separate contractor to build the core and shell for the second floor. Having two contractors working on the structure of the same building would also create significant coordination issues and cause confusion regarding responsibility for warranty work. The cost of the library's portion of the core and shell will be determined by the final design of the libraryspace but is not anticipated to exceed $1.5 million. Under the City's agreement with Bayer, the City must approve the design and all costs associated with construction of the core and shell on a line item basis. The City has hired an independent estimator to verify the reasonableness of all costs. Staff intends to utilize a competitive process to select a contractor to finish the library space. The finish work includes the entire interior space of the library, everything from drywall and electrical to carpeting, lighting and shelving. Partnering with Bayer on the Library project maximizes use of the impact fees designated for library services and materials. Bayer's contribution to the libraryproject is substantial. • Bayer is providing the land for the library building and paying for the infrastructure costs associated with bringing necessary utilities and streets to the development and to the library building itself. • Bayer is also providing the adjacent parking lots and paying the associated offsite development costs and fees. Operation Services has estimated that the cost savings to the City by partnering with Bayer is approximately 2.2 million dollars compared to the cost of the City building a stand alone branch library. Resolution 2007-021 Because the City is under extreme time pressures to complete the construction of the library in conjunction with the construction of the Front Range Village, City Purchasing has made a determination per Section 8-161(d)(1)(b) of the Code of the City of Fort Collins, that although there RM March 6, 2007 exists more than one (1) responsible source, a competitive process cannot reasonably be used or, if used, will result in a substantially higher cost to the City, will otherwise injure the City's financial interests or will substantially impede the City's administrative functions or the delivery ofservices to the public. The Purchasing Agent has submitted the requisite justification to the City Manager for approval and the City Manager has reviewed and concurred in that determination for this acquisition. Section 8-161(d) (3) requires Council approval ofall exceptions to the competitive process over One Hundred Thousand Dollars ($100, 000) prior to acquisition. Bayer Properties intends to begin construction of its development next month and open the new retail center in June of 2008. Due to the aggressive timeline for construction of the building that will include the library, Aller-Lingle Architects, already under City of Fort Collins purchasing contract, was consulted for preliminaryplans required by Bayer to begin the core and shell design. Aller-Lingle sub -contracted for library design expertise from Joseph Montabano of Studiotrope in Denver. Phase One was completed for $41, 000 and allowed Bayer Properties architects to begin drawings for the core and shell of the building. To insure the integrity of the Southeast Branch Library project, from conceptual design through completion, City staff is asking to hire Aller-Lingle to provide comprehensive architectural services through the design and construction phases of the project, including mechanical, electrical and librarydesign. The estimated cost for these services is $191,300. Aller Lingle Architects P.C. 's design team is the most appropriate for continuing the design workfor the new Fort Collins branch library because: • The team ofAllerLingle Architects P.C. and Studiotrope has been working with the library staff for the programming and conceptual design phases of the project, including coordination with Bayer Properties, and has full knowledge and understanding of the functional and aesthetic needs of this library branch. • Studiotrope was selected by the library staffas the library design consultant based upon its experience and skill in library planning and design. • AllerLingle Architects P. C. has a 20-year working relationship with the City ofFort Collins, including such major projects as the Downtown Transit Center and the Northside Aztlan Community Center. • Aller Lingle Architects P.C. has experience with LEED-accredited projects, including both the Utilities Vehicle Storage facility and the Northside Aztlan Community Center for the City. • Aller-Lingle Architects P.C. has a working knowledge of the City's Design Standards Manual, specifying the design and maintenance requirements ofall cityfacilities. 249 March 6, 2007 Aller-Lingle has retained the services of Joseph Montalbano, an award -winning architect with ten years ofexperience designing libraries in Colorado and elsewhere. He has worked on public libraries in Littleton, Aurora, and Walsenburg as well as Reno, Nevada. He spent seven years working with the Denver firm Brendle AVP. Ordinance No. 037, 2007 The City would use available library impactfees to payfor the design and construction ofthe library and for the library collection. • The City would own the library through a condominium deed Bayer is providing. • All off -site development costs, parking, utility infrastructure to the building, streets, green space and numerous site amenities will be provided by Bayer without cost to the library project. • The City will pay for construction of the second floor library space and related infrastructure, including a first floor lobby, elevators, a stairway and book drops. • The branch library will be operated by the new Fort Collins Regional LibraryDistrict under the terms worked out in the intergovernmental agreement. It is anticipated that construction of the new library will be completed by June 2008 so it can be opened at the same time the shopping center opens. " Deputy City Manager Jones stated this agenda item was being brought forward to Council because the Southeast Branch Library would be part of the Bayer Properties development. Marty Heffernan, CLRS Director, stated three items were before Council for consideration. He stated the City had been working with Bayer Properties with regard to inclusion of a branch library in a project at the intersection of Harmony and Ziegler Roads. Bayer Properties was developing a retail center (Front Range Village) at that location. The City was not in a position to work with Bayer Properties on inclusion of the branch library until the funding to operate the library was realized through the passage of the Library District measure by the voters last November. Since then the City had been working with Bayer Properties on the design and making the branch library a reality. Resolution 2007-020 would give authority to hire Bayer Properties as a sole source contractor to build the shell of the library. He presented visual information showing the site and the conceptual design for the library, which would be 16,000 square feet on the second floor of the development. The City would own this space and that improvements from the building outward would be paid for by Bayer Properties. The City would pay common area maintenance expenses as part of the development. The City's contribution would be to pay for Bayer Properties to do the work for the second story of the building (the walls and infrastructure). The City would hire a separate contractor to finish the inside space. The Bayer Properties contribution to this project was worth over $2 million and that the City's costs would be in the $5.5 million range. Funding for the project would come from impact fees collected by the City since about 1996 on new residential 250 March 6, 2007 construction. He stated $1 million of the funding would be for the book collection. Bayer Properties intended to open in the summer of 2008. He stated sole source authority was needed because the City was not in a position to do a competitive bid for this part of the work. Resolution 2007-021 would authorize an exemption to the competitive process for the City to enter into a contract with Aller-Lingle Architects to complete architectural services of the design and construction phases of the Southeast Branch Library. Ordinance No. 037, 2007 would appropriate $5.5 million of impact fee money to pay for the project. About $1.5 million would go toward the shell, about $200,000 would go for design services, about $1 million would go for books and materials, and the rest would go toward finish work and furnishings. The City would save a few million dollars through this partnership. One of the key discussion items with the new Library District board of trustees would be the branch library operation. Councilmember Ohlson asked how long the City had been considering building a library in this part of town in partnership with Bayer Properties. Heffernan stated this had been in the long range plans for at least seven or eight years and that the City had been discussing the project with Bayer Properties for three to four years. Councilmember Ohlson asked about the advantages and disadvantages of a first story library and second story library. Heffernan stated the first floor location would be slightly better but that the second floor location would have good access and prominence and visibility due to the design. He stated Bayer Properties was bringing about $2 million to the project and that retail space on the first level was important to the developer. There were examples of successful second story libraries in this type of development. Staff believed that the second floor location would not be detrimental to the success of the library. Mayor Hutchinson stated the dollar savings to the City was an important consideration in Council's decision on this agenda item. He stated using a competitive process would result in a much higher cost to the City. He asked how much the City would save. Heffernan stated the savings would be due to the arrangement in which the City would not have to pay for other development costs such as parking. James O'Neill, Purchasing Agent, stated the cost savings to the City included Bayer Properties paying the cost of improvements and the City not having to go through the RFP process. Councilmember Weitkunat made a motion, seconded by Councilmember Manvel, to adopt Resolution 2007-020. Councilmember Manvel stated the City currently had a "second floor" library for adults downtown. The vote on the motion was as follows: Yeas: Councilmembers Brown, Hutchinson, Kastein, Manvel, Ohlson, Roy and Weitkunat. Nays: None. THE MOTION CARRIED. Councilmember Roy made a motion, seconded by Councilmember Weitkunat, to adopt Resolution 2007-021. 251 March 6, 2007 Councilmember Ohlson stated he would vote against the motion because this had been in the works long enough for the City to use the normal bid process for the architect. It was also an issue that the architect was on the Planning and Zoning Board and this architect was also doing the design work on other large City projects. This compounded the problem of an exemption to the normal bid process. Councilmember Kastein asked if these architectural drawings had gone to the Planning and Zoning Board and if that particular Board member had a role in the discussions. Ken Maranon, Operations Services Director, stated the library plans had not gone to the Planning and Zoning Board because it was at the conceptual phase. Plans for the Northside Center would have been considered before the architect was on the Board. The practice would be for a Board member to not participate in any discussion or decision in which he had an interest. Councilmember Ohlson stated he had no issue with the individual architect. In general he believed that if someone was frequently bidding on City projects, they should be on another board or commission and not the Planning and Zoning Board. Planning and Zoning Board members worked with "high level staff' and would deal with such staff when bidding on City projects. He did not believe that someone should both bid on City projects and serve on the Planning and Zoning Board. Councilmember Kastein stated there was a policy in place that a Board member must recuse himself if there was a conflict of interest. He did not believe that there was any impropriety in any City project. It appeared that the architect was not on the Board when some of the projects mentioned by Councilmember Ohlson would have gone to the Board. Councilmember Ohlson stated he stated his comments had nothing to do with the individual. In general these kinds of situations should not be "set up." People should not apply to boards that may be considering large City projects on which they would bid. Heffernan stated the City did not know that this matter would be moving forward until the Library District was approved by the voters. Bayer's schedule became compressed and there was pressure to get the conceptual design done quickly. The City was not in a position to take this out for a full bid and that staff believed that the only alternative was to bring this agenda item forward to the Council. Mayor Hutchinson stated he was satisfied that this was the only solution to an unusual situation. Heffernan stated the only other choice was to tell Bayer to wait and throw the project off schedule. Staff believed that this was the best way to proceed. Mayor Hutchinson stated it made boards and commissions stronger to have people with expertise serving. He stated there was a conflict of interest procedure in place. The vote on the motion was as follows: Yeas: Councilmembers Brown, Hutchinson, Kastein, Manvel, Roy and Weitkunat. Nays: Councilmember Ohlson. THE MOTION CARRIED. Councilmember Weitkunat made a motion, seconded by Councilmember Roy, to adopt Ordinance No. 037, 2007 on First Reading. 252 March 6, 2007 Councilmember Weitkunat stated this ordinance would make the branch library "real." She stated the private -public partnership would make the branch library a reality. Decisions would have to be made quickly because the new Library District had been approved. She thanked former Councilmember Marty Tharp for having the "audacity" to ask Bayer Properties if they would be willing to build a library. Councilmember Ohlson thanked former Councilmember Marty Tharp for being the "driving force" behind this idea. Councilmember Manvel stated money had been accumulated to build a library, the new Library District had been created, and Bayer Properties was moving forward with the retail project. He stated everything needed to move forward quickly at this point. Councilmember Kastein thanked the staff for its hard work on this public -private partnership. He stated he would look forward to seeing this project come to fruition. Mayor Hutchinson stated this was a "good news" item and thanked former Councilmember Tharp for the idea and staff for the hard work. The vote on the motion was as follows: Yeas: Councilmembers Brown, Hutchinson, Kastein, Manvel, Ohlson, Roy and Weitkunat. Nays: None. THE MOTION CARRIED. Resolution 2007-026 Ratifying Appointments to the Fort Collins Regional Library Board of Trustees Adopted. The following is staff s memorandum on this item. "EXECUTIVE SUMMARY Last November, area voters approved the formation of the Fort Collins Regional Library District and provided 3 mills in property tax to fund it. The District cannot begin operations until its Board of Trustees is in place. The City Council and County Commissioners have formed a Library District Trustee Selection Committee comprised of Commissioners Kathay Rennels and Karen Wagner and Councilmembers Karen Weitkunat and Ben Manvel. The Committee is charged with selecting candidates to fill seven trustee positions. The selected candidates must be ratified by a two-thirds majority vote ofboth the City Council and the County Commissioners. By adopting this Resolution, the Council will be ratifying the trustee candidates selected and recommended by the Selection Committee. BACKGROUND Upon formation ofa library district, state lawprovides a processforselecting the Board of Trustees to govern the new district. In the case of the Fort Collins Regional Library District, this process 253 March 6, 2007 calls for the formation of a Trustee Selection Committee, composed oftwo representatives from the City Council and two County Commissioners. The Committee is charged with selecting and recommending candidates for the Board of Trustees for ratification by the full Council and the Commissioners. Ratification must be by two-thirds majority vote. The Selection Committee was formed and conducted an outreach process to solicit application for the trustee positions. Sixty-one applications were received and the Committee members reviewed and rated each one. After a comprehensive discussion the Committee selected seventeen applicants for interviews. The seventeen applicants were interviewed over the course of three days. After careful deliberation, the Committee selected seven candidates to fill the seven Board of Trustee positions. The candidates selected by the Committee and recommended for ratification by the full Council and the Commissioners are: • Nina Bodenhammer (4 years) • Robin Gard (3 years) • Michelle Kalkowski (2 years) • John Knezovich (1 year) • Mike Liggett (S years) • Mary Robertson (S years) • Robert Viscount (4 years) The applications and associated documentation provided by the candidates to the Committee are included as Attachment 1. State law provides the initial terms for the trustees. One trustee serves for one year, one for two years, one for three years, two for four years and two for five years. Thereafter, trustees are appointed for the length of term specified in the bylaws adopted by the Board of Trustees. The number of terms a trustee may serve is also specified in the bylaws. After the initial term expires, recommendations tofill the position may be provided by the Trustee Selection Committee or the City and County can agree to allow the Board of Trustees to recommend candidates. Actual trustee appointments must be ratified by both the Commissioners and the Council, by a two-thirds majority. The initial term for each selected candidate recommended by the Committee is noted above. Once the trustees are ratified by the Council and the Commissioners they will begin the business of adopting bylaws and creating the operational framework for the District. State law requires the District, the City and the County to enter into an intergovernmental agreement within 90 days of the ratification of the trustees. " Marty Heffernan, CLRS Director, stated this item was ratification of the appointment of members of the new Library District's Board of Trustees. The Library District would be taking over library operations in the City. State law provided for formation of a committee to recommend a group of potential Trustees to the Council and the Commissioners. Councilmembers Manvel and Weitkunat and Commissioners Wagner and Rennels were recommending the appointment of seven candidates to the Board of Trustees for specific terms of service ranging from one to five years. Ratification of the appointments required a two-thirds majority of the City Council and the Commissioners. 254 March 6, 2007 Councilmember Kastein asked when the issue of an elected official on the Library District Board of Trustees would be discussed. Heffernan stated the Council and the Commissioners had discussed this matter and had decided that the initial Board of Trustees would not contain a City Councilmember since the Board of Trustees would be working on an intergovernmental agreement that would set forth the rights and responsibilities of the respective parties (District/City/County). It would be difficult for an elected official to represent the interests of the District and the City or County. There would be an opportunity for appointment of an elected official when vacancies on the Board of Trustees came up in the future. Councilmember Kastein asked when the Council would see that decision in writing. Heffernan stated this could be included in the intergovernmental agreement. Councilmember Kastein strongly recommended that this be part of the intergovernmental agreement. His approval of the Resolution would be conditional upon the inclusion of that in the IGA. Heffernan stated staff would take that position and noted that the County and the District would both have to agree to the IGA. Councilmember Kastein stated he had an understanding that the appointments would be made with an agreement in place that would "guarantee" Council representation on the Library Board of Trustees within one year. Councilmember Weitkunat stated the County Commissioners indicated that they would not approve a Board of Trustees containing a City Councilmember. There was a "stalemate" on this issue from the beginning. Agreement had been reached that it would be difficult to have a City Councilmember on the initial Board of Trustees. She understood that the issue of an elected official on the Board of Trustees would be a "piece" of the negotiations relating to the IGA. There was also agreement that both the City Council and the Commissioners would always approve appointments to the Board of Trustees. The Council was "powerless" to do more on this at this point. Councilmember Manvel stated it would be a three-way intergovernmental agreement and that he hoped that all parties would demonstrate "flexibility" so that there could be a "meeting of the minds." The issue of an elected official serving on the Board of Trustees could not be resolved at this time. Councilmember Ohlson stated he believed that it was unlikely that an elected official would ever serve on the Board of Trustees because one of the members of the Board of Trustees would have to be replaced by a City Councilmember. He questioned whether the Board of Trustees would also have to ratify future appointments. Councilmember Manvel stated any new appointments would have to be approved by the Commissioners and the City Council. The process for making appointments would be part of the intergovernmental agreement. Councilmember Ohlson stated he did not want the Board to be able to appoint new Board members. Councilmember Manvel stated this would not be allowed under State law. 255 March 6, 2007 Councilmember Ohlson stated the key issue for him was that the City Council and the Commissioners would make new appointments. Mayor Hutchinson suggested that there may be other options for future discussion, such as the creation of an ex-officio position in which an elected official could serve. He understood from the work session the Council was in agreement that it did not make sense to have a Councilmember serving on the initial Board of Trustees. Councilmember Kastein stated he had no issue with the decision that a Councilmember should not serve on the initial Board of Trustees. The issue was that the City had a $15 million investment that would be given to the Library District. In his opinion there needed to be elected official representation on the Board of Trustees on an ongoing basis. He asked if there was anyway to build in the requirement that within one year Council representation would be on the Board of Trustees. City Attorney Roy stated this could be discussed as part of the IGA negotiations. It was "problematic" to condition the appointment of the initial Board of Trustees on the appointment of a Councilmember at the end of a year. The Council could express its intention to have a Councilmember on the Board of Trustees in the future and that this could be explored within the statutory framework. There was no way to achieve that without the County's consent at this point. Councilmember Roy made a motion, seconded by Councilmember Manvel, to adopt Resolution 2007-026. Councilmember Ohlson thanked Councilmembers Manvel and Weitkunat for their work on the selection process. Councilmember Manvel thanked the 61 people who applied to serve in this "major job." He noted that City operations depended heavily on volunteers and that this would be an "outstanding" group of Trustees. Councilmember Weitkunat stated "incredible" people would be building the Library District for everyone. Councilmember Roy stated different Library Districts were run under different "philosophies" and that the Board of Trustees would have a big job ahead of them in guiding how the library would perform and function in the future. Mayor Hutchinson stated people were the most important part of the process. The vote on the motion was as follows: Yeas: Councilmembers Brown, Hutchinson, Kastein, Manvel, Ohlson, Roy and Weitkunat. Nays: None. THE MOTION CARRIED. (**Secretary's Note: The Council took a recess at this point in the meeting.) 256 March 6, 2007 Ordinance No. 045, 2007, Establishing Local Sanctions Upon Contractors and Subcontractors of the City Who Employ Unauthorized Aliens to Perform Work for the City, Defeated on First Reading. The following is staffs memorandum on this item. "FINANCIAL IMPACT Staffhas estimated that it would require 30 to 40 hours to conduct each audit ofone firm with 100 employees that has contracted for work with the City. Ifthe audit is conducted by City staff, the cost is estimated at $1, 600 and, if the audit is outsourced, it is estimated to cost approximately $3,200. A large construction contract with 20 subcontractors and over 1, 000 employees, such as the Police Administration Building project, could cost between $12,000 (City staff and $24,000 (outside source) to audit. Based on current workloads, staff could reasonably absorb audits of two to six companies per year. If more than six audits are necessary or desired, it is likely that additional resources will be required. The proposed Ordinance may require contractors and/or subcontractors additional time and administrative costs associated with multiple sets ofsimilar tasks and responsibilities required by each tier ofgovernment. If the risk of doing business with Fort Collins Vines and/or debarment) is great enough, contractors will typically do one of two things - not bid work offered by the City or raise their prices to cover potential costs. Both of these can result in increased costs to the City. EXECUTIVE SUMMARY This Ordinance makes it unlawful for contractors and subcontractors who perform work on City projects to hire unauthorized aliens. It applies to major construction and service contracts. Contractors and subcontractors are required to verify the legal employment status of employees working on City contracts and must maintain copies of these records. If they fail to perform the appropriate screening and documentation, the City may terminate these contracts with the City and may prohibit future contracts with the City for a period of five years. If a contractor or subcontractor falsely identifies, or falsely certifies the legal employment status of, any person working on a City contract, a fine of $1, 000 for each infraction may be imposed. BACKGROUND At the October 24, 2006 City Council work session, Council reviewed and discussed the implementation of new state immigration laws. One of the state laws enacted in 2006 requires that the City take certain steps to ensure that unauthorized aliens are not allowed to perform work on any of its contracts for services (HB 1343). A contract for services is defined as the furnishing of labor, time or effort by a contractor or subcontractor not involving the delivery of a specific end product other than reports that are merely incidental to the required performance. The City has adopted the interpretation that HB 1343 does not apply to construction contracts as they involve the delivery of a "specific end product. " 257 March 6, 2007 Compliance Requirements ofHB 1343 Under HB 1343 contractors must certify that they do not knowingly employ or contract with an unauthorized alien and have participated or attempted to participate in the "Basic Pilot Program " in order to verify that the contractor is not employing any undocumented or unauthorized worker. The "Basic Pilot Program " is a web -based program, maintained by the Department of Homeland Security, and allows employers to conf rm the employment eligibility of all newly hired employees. Penalties ofNon-compliance ofHB 1343 Violation by contractors of the mandatory provisions ofHB 1343 can be grounds for termination of the contract, but termination is not required. Ifa contract is terminated by the City, the Secretary of State must be notified. City Council Direction Direction provided by City Council at the October work session was for staff to prepare and present a local ordinance that meets the following criteria: • Applies to both service and construction contracts between the City and persons, vendors, contractors, and any other type of business entity. • Enforcement will occur through"spot checks" and impromptu audits ofcompliance, as well as a complaint basis. • City contracts will go only to those persons, vendors, contractors and business entities that verify that they do not employ unauthorized aliens through the use of the most reliable indicia of legal status. Ordinance EstablishingLocalSanctionson Contractors/Subcontractorsofthe City Who Employ Unauthorized Aliens on City Projects The purpose of preparing a local ordinance on this subject is to complement federal and state laws that apply to employment practices on City projects. More specifically, the purpose of the Ordinance is to emphasize to contractors and subcontractors who provide the City with services, including construction services, that employment of unauthorized aliens is contrary to the interests of the City and its citizens and that any contractor and/or subcontractor that does not comply with the prohibition can and will by penalized. The following are the pertinent elements of the proposed Ordinance: • Applies to City construction contracts over $500,000, service contracts over $100,000 and major warranty work, except for those services that are exempted from the procurement provisions ofthe City Code, i.e., donations, legal and litigation services, musicals, dramatic and fine arts performances and intergovernmental agreements. March 6, 2007 • Prohibits contractors andsubcontractorsperforming such workfrom knowingly recruiting, hiring for employment, or continuing to employ any unauthorized aliens to work on covered City projects. • Requires contractors and subcontractors to certify to the City that they have verified the legal employment status of all employees working under the contract or subcontract by reviewing the I-9 documentation required by federal law. • Requires contractors and subcontractors to maintain, for a period of one year from completion of the contract work, all documents they relied upon in verifying the legal employment status of those who worked on the project. • Requires contractors to review the documents relied upon by their subcontractors before entering into the subcontracts. • Requires contractors and subcontractors, upon request by the City, to verify the identity of all persons working on the project and to produce for City inspection the documents relied upon in verifying the legal employment status of such persons. • Makes it a civil infraction for any contractor or subcontractor to falsely identify, or falsely certify the legal employment status of, any person working on a City project. • Requires all contractors and subcontractors to comply with Title 7ofthe United States Code and not unlawfully discriminate against any employee or applicant for employment. • Authorizes enforcement ofthe Ordinance through audits of compliance, conducted pursuant to administrative regulations, or through the investigation of complaints as long as those complaints are in writing and include a recitation of the facts establishing the alleged violation. • States that complaints based primarily on the basis of race, color, national origin, ethnicity or other constitutionally or statutorily protected status will not be investigated. • Requires the City to give contractors and subcontractors notice and an opportunity to be heard if the City suspects a violation of the Ordinance, unless the contractor or subcontractor has previously violated the Ordinance. • Authorizes, but does not require, the City to terminate a contract and prohibit the violator from entering into future contracts with the Cityfor a period of five years. • States that the violator will be liable to the Cityfor any actual, consequential damages the City may experience as a result of the termination of the contract. • States that ifany portion ofthe Ordinance is invalidated by a court, the remaining portions will remain in effect. 259 March 6, 2007 Comparison Between State Law and the Ordinance The state law that addresses this same subject is House Bill 06-1343, which has been enacted as C.R.S. §8-17.5-101. That law applies only to "contracts for services." Thus, the scope of the proposed Ordinance is broader than the state law. (However, at least one state agency has interpreted the state law as applying to construction contracts as well as contracts for services) The purpose of the state law is similar to the proposed Ordinance but the state law is directed towards the government entities rather than their contractors and subcontractors. The state law essentially prohibits state agencies and political subdivisions from entering into or renewing a public contract for services with a contractor who knowingly employs or contracts with an unauthorized alien to perform work under the contract or who knowingly contracts with a subcontractor who does so. It also states that all covered contracts must contain provisions prohibiting the employment of unauthorized aliens; prohibiting subcontracts with subcontractors who have failed to certify that they will not knowingly employ unauthorized aliens; requiring the contractor to verify or attempt to verify, through participation in the basic PILOTprogram, that the contractor does not employ unauthorized aliens; and requiring contractors to terminate subcontracts with subcontractors who, after notice, continue employing any known unauthorized aliens. Like the Ordinance, the state law authorizes governments to terminate contracts with contractors who violate the law, and they may recover any actual and consequential damages that they may incur in doing so. Governments terminating contracts under the law are to notify the Secretary of State of any contracts terminated under the law, so that the violators will be placed on a statewide list. In comparing the state law with the proposed Ordinance, the significant differences and similarities are as follows: (a) The state law pertains only to service contracts, while the Ordinance refers to both service and construction contracts. (b) The state law pertains to all public contracts for services, regardless of the amount. The Ordinance pertains to only those contracts which meet a threshold amount and are subject to the procurement provisions of the City Code. © The state law requires that certain provisions be placed into a public contract for services as morefully lly discussed above. The Ordinance does not require particular contract language but instead makes it unlawful to hire unauthorized aliens to work on contracts, subcontracts or major warranty work of the City, requires a verification process, and requires contractors and subcontractors to maintain copies of their records. (d) The state law imposes no civil or criminal sanction for a violation of the statute. The Ordinance imposes a civil penalty of $1, 000 per infraction if a contractor or subcontractor falsely identifies, or falsely certifies the legal 260 March 6, 2007 employment status of, any person working for the contractor or subcontractor on a City contract, subcontract or major warranty work. (e) Both the state law and the Ordinance provide for the termination of a contract if a contractor fails to abide by the law, and for the recovery of consequential damages. Enforcement City staff will be responsible for enforcing the Ordinance. Enforcement will be carried out through audits of compliance and written complaints. More specifically, enforcement activities would consist of 1. making sure, when contracts are let, that contractors and subcontractors certify that they have reviewed the I-9 documents and verified the legal employment status of their employees; 2. conducting periodic "spot checks" or audits, reviewing the documentation that the contractors and subcontractors are required to maintain; 3. going onto a job site if there is a complaint and trying to determine the identity (though not the legal employment status) of all persons on the site and then checking the contractor's records to see if the contractor has checked the employment status ofa particular employee and has documents on file verifying such status. Citypersonnel generally do not have the training needed to determine the legal employment status of individual workers. Federal officials are usually in charge of investigating the status of individual immigrants. However, if staff can identify who the people are at a particular site, they may be able to determine whether the contractor has checked and verified their status as required by the Ordinance as well as federal and state law. The difficultly is that staffmay not always be able to match a person's identity with the paperwork maintained by the contractor or subcontractor. Staff has estimated that it would require 30 to 40 hours to conduct an audit for a service contract. This includes preparation, review of files/documentation and preparation of the audit report. Calculating staff time, the estimated average cost for each service contract audit, whether by complaint or spot check, is $1, 600. Based on current workloads staff could absorb two audits per year. If more than two audits are desired or required, it is likely that additional resources will be required. An audit on a large constructionproject, such as the Police Administration Building which involves one general contractor and 20 subcontractors for a total of 1,000 employees, would take an estimated 300 hours to complete. For staff to do the audit, it would cost approximately $12,000 (based on $40/per hour) and if the audit was outsourced, the estimated cost is $24, 000 (based on $80/per hour). 261 March 6, 2007 Based on current workloads, staff could absorb two to six audits per year. If more than six audits are desired or required, it is likely additional resources will be required. Effect On City Contracts/Contractors Staff believes that most, if not all, of the City's contractors comply with the State of Colorado and Federal PILOT program. Though staff did not conduct an extensive outreach effort, a few contractors voiced their concern that the Ordinance may require additional time and administrative costs associated with multiple sets of similar tasks and responsibilities required by each tier of government. While confident about the ability to comply with federal, state and, if the Ordinance is approved, City requirements thatprohibit hiring unauthorized aliens, contractors are concerned that they could be tripped up on a technicality and face, as a result, significant time and cost to work through the process and defend their documentation and/or employees. This concern is exacerbated by the fact that most subcontractors are small firms with limited resources, and these subcontractors are less certain about their capacity to meticulously and thoroughly completed the required documentation for and respond to an audit. As the risk of doing business with Fort Collins (fines and/or debarment) increases, contractors typically do one of two things — not bid work offered by the City or raise their prices to cover potential costs. Both can result in increased costs to the City. The City competes regionally for qualified f rms. Some firms may elect not to bid on City contracts because of the added regulation. At the present time there is more than enough business for these firms with others who will not have these regulations. Staff does not have specific data that addresses the degree to which contractors and subcontractors —ones that are currently doing business with the City as well as those that are potential contractors —comply or don't comply with existing federal and state laws related to employing unauthorized aliens. Consequently, it is not possible to determine the extent to which the proposed Ordinance will help prevent the employment of unauthorized aliens on Cityprojects in Fort Collins. On the other hand, adoption and enforcement of the Ordinance will send a strong message to businesses that positions of employment in the City should be reserved for persons who are legally authorized to work in this country. Ultimately, the question presented by the proposed Ordinance is whether the additional requirements and penalties presented by the Ordinance are needed to better ensure that no unauthorized aliens work on City contracts." Deputy City Manager Jones presented background information relating to the agenda item. She stated this was First Reading of an ordinance that would establish local sanctions on contractors and subcontractors of the City who employed unauthorized aliens to perform work for the City. The purpose was to ensure that unauthorized aliens were not working on City contracts. This ordinance would complement existing federal and state laws. Contractors and subcontractors would have a responsibility to check and verify that they were not hiring and employing unauthorized aliens. The ordinance would affect anyone who was not a citizen or national of the United States, anyone not in the U.S. as a lawful permanent resident, and anyone who did not have appropriate documentation 262 March 6, 2007 to work in the U.S. It would affect contractors and subcontractors who enter into a contract with the City of Fort Collins to provide a service in the amount of $100,000 or more or construction or warranty work involving $500,000 or more. The City purchasing code exempted certain services. Contractors and subcontractors working on City service or construction projects must verifythe legal employment status of their employees and must maintain copies of those records for one year after completion of work on City contracts. There would be penalties for two types of violations: (1) improper screening and documentation, and (2) false identification and certification. The City's role relating to enforcement would be responsibility for spot audits and responding to written complaints. It would require 30-40 hours of staff time to conduct an audit for a service contract at an estimated cost of about $1,600 and that a large construction project could require up to 300 hours at a cost of $12,000 if done by City staff or $24,000 if outsourced. Approximately two to six audits could be performed by City staff. HB 1343 applied to contracts for services provided to government entities, required that contractors and subcontractors attempt to verify employment status, and provided that violations could result in the termination of a contract and a report to the Secretary of State. She provided a comparison between the requirements of HB 1343 and the proposed City ordinance. Federal and state requirements and the proposed ordinance would all prohibit public contractors from hiring and employing persons who are not authorized to work in the U.S. Federal requirements provided that employers must check; that state requirements provided that contractors must check and certify that unauthorized persons are not knowingly hired and allowed for contracts to be terminated; and that the proposed ordinance would require checking and certification, the maintenance of documents for a specified period of time and fines if the information is found to be false. The primary question was what level of oversight are necessary and desired to ensure that unauthorized aliens are not working on City contracts. Mayor Hutchinson stated each audience participant would have two minutes to speak. Jim Moody, 1917 South Shields Street, Director of Owner/Agency Relations for the Colorado Contractors Association, spoke in opposition to the ordinance because of the existing state and federal laws. Greg Snyder, 619 Bear Creek Drive, asked the Council to consider lowering the contract amount to ensure that everyone would be "playing by the rules." He stated the biggest issue would be verification since the government did not provide business owners with the "tools" to do that. Gloria Balderrama, 1400 Casa Grande Boulevard, opposed the ordinance and noted that federal legislation was pending for comprehensive immigration reform. She expressed concerns that the ordinance could contribute to profiling. James Ross, Human Relations Commission member, stated the Commission had reviewed the proposed ordinance and was recommending that the Council not support the ordinance. There was no clear purpose in going beyond the state and federal law. There was no clear benefit and that there were "red flags" and costs to the City. The ordinance would send a "message" of intolerance and could create a human rights issue by potentially infringing on personal liberties. The Commission was suggesting that before an ordinance was adopted a study should be undertaken to determine the scope and consequences of the existing situation. 263 March 6, 2007 Betty Aragon-Mitotes, 140 2nd Street, spoke in opposition to the ordinance. She pointed out the costs of enforcement of the ordinance. She stated the ordinance would contribute to "divisions" in the city and expressed concerns about "racial profiling." This proposed ordinance would "go too far." Don Flick, 520 North Sherwood Street, opposed the ordinance. He stated adoption of this ordinance would be "harmful" because it would "cut off the debate" about the issues. Allison Shaw, 633 Remington Street, stated this ordinance would "send the wrong xenophobic message" that Fort Collins was "not welcoming of diverse cultures." She stated the ordinance would create more "red tape and big government." Charlotte Miller, 2875 Blue Leaf Drive, agreed with the statement made by the Human Relations Commission and opposed the ordinance. She stated every human being deserved a "life of dignity" and that ways should be found to "welcome strangers among us." This kind of legislation was "morally corrupt." Paul Barrie, 520 North Sherwood Street, spoke in opposition to the ordinance and stated it would "levy an unfunded mandate" on small businesses to do the required verifications. He expressed a concern that businesses could "run afoul of the EEO law." He stated "extraordinary training" would be required for City employees in charge of enforcement. He did not want Fort Collins to become the "show me your papers" city and that he did not want local businesses to become the "immigration police." Bill Simpson, 331 Park Street, supported the HRC's statement on the ordinance. There were more "pressing issues" facing the community, that there would be a danger of "racial profiling" during a "period of hysteria" in which "hate groups" aligned with "anti -immigrant" groups, and the he would like the Council to defeat the ordinance. David Lipp, 1916 Springfield Drive, urged the Council to stay out of immigration issues and defeat the ordinance. Matt Lawrence, 318 West Laurel Street, spoke in opposition to the ordinance and stated the community should be welcoming to everyone. Lisa Olivas, 825 East Elizabeth Street, asked the Council to defeat the ordinance. It would not accomplish the stated objectives and that there were already state and federal requirements in place. Bart Verron, Fort Collins resident, expressed concerns regarding the cost of enforcement and how the ordinance would affect contractors bidding on City projects. This could increase the cost of City projects. Cheryl Distaso, 135 South Sunset Avenue, had many concerns about the ordinance, including how complaints and enforcement would happen. She expressed concerns that complaints could be made by "competitors" or could be made based on few facts. She urged the Council to vote against the ordinance. 264 March 6, 2007 Roberto Valdez, southwest Fort Collins resident, spoke against the ordinance and stated a comprehensive study of immigration needed to be done before such an ordinance was considered. He spoke regarding "displaced populations" and the effects of free trade acts. The "root of the problem" needed to be dealt with and "better information" should be obtained. John Alvarez, Fort Collins resident, stated the word "alien" was "disturbing" to many people. Spending money on an ordinance such as this would be expensive in a time of"shrinking budgets." Kimberly Medina, 2436 Charolais Drive, stated the federal immigration policy had failed but a local ordinance was not the way to address the issue and that it would not make a difference. Marwan Achila, American citizen from Beirut, Lebanon, spoke in support of the ordinance. He believed that many people wanted to hire illegal aliens to "save money." It was wrong to hire illegal aliens and that people needed to follow the law. Walter Peeples, 1523 Miramont Drive, business owner and subcontractor, spoke regarding the possible consequences of the ordinance for the community. It was "scaring" the Mexican -American community and the construction, housing, restaurant and food service industries. He questioned the "rationality" of this "intimidating" ordinance. Shirley Malin, 2013 Custer Drive, legal alien, spoke in support of the "rule of law" and stated "unity should trump diversity." The "nonsense" about racism was a "smokescreen" and the word "alien" was a "legal term." It was a "cop-out" to leave this up to the federal government and people should "take a stand" in their own community. Many Americans were "so comfortable that they did not know what was going on." She supported the ordinance. Mary Detweiler, 4255 Westshore Way, she stated immigration was a "complex situation" and that "strict enforcement of the law" could be "inhumanitarian." The immigration law needed to be "totally revised" by the federal government. Kimi Jackson, 1112 Kirkwood Drive, attorney, stated there would be little to no benefit from this law and the cost would be great for taxpayers, workers and local businesses. The City could face legal challenges for preemption and under federal law, businesses did not have the right to request documentation beyond the information required on the I-9 form. Businesses that require additional documentation could face fines or lawsuits. Businesses were already subject to the complicated requirements of federal law and should not be subject to further local immigration requirements. She asked the Council to vote against the ordinance. Stan Weeks, Boulder resident, Director of the Colorado Alliance for Immigration Reform, stated this was an identification rather than immigration issue. Mike Wise, 2812 North Overland Trail, supported immigration reform at the local level but that it was "premature" to adopt this ordinance right now. This issue was a "matter of illegality" and he would support taking local action at some point. 265 March 6, 2007 Vivian Armendariz, 820 Merganser Drive, stated the terms "illegal alien" and "illegal immigrant' were "degrading" to Hispanic persons. The cost of enforcing the ordinance would be too high at a time of budget cuts. Chris Woodward, CSU graduate student, stated there was a "flaw" in the verification system and that about 10% of verifications had errors. He opposed the ordinance. Mayor Hutchinson thanked those who spoke. Councilmember Brown asked staff to explain the I-9 verification process. City Attorney Roy stated the I-9 verification was required under federal law. The form was completed by the prospective employee and the employer and the intent was to determine the legal employment status of the applicant. Certain documents were listed as acceptable on the back of the I-9 form. Federal law prohibited the employer from requiring other documents if the documents submitted by the prospective employee appeared to be genuine. The verification of documentation must be completed within three days of the date of hire. The basic requirement to verify the legal employment status of a job applicant therefore existed under federal law. This ordinance was an attempt within the context of government contracts to ensure to the City that its contractors had followed the federal law. Councilmember Brown asked if the federal, state and local laws all required the same paperwork. City Attorney Roy stated the ordinance did not require contractors to verify employment status in any other way than the way required under federal law. The contractor would be required to submit an additional certification. Councilmember Manvel stated the City ordinance would require a certification by the contractor and maintenance of records. His understanding from the presentations that were made was that the state law also required the certification but not the maintenance of the records. City Attorney Roy stated both the state law and the ordinance would require a certification from the contractors that they had verified or attempted to verify in one way or another the legal employment status. Federal law required retention of the I-9 form and neither federal or state law required the employer to retain the documents that were reviewed to verify the legal employment status of the applicant. The ordinance would require the contractors to retain those documents for a period of at least one year after the end of the contract. Councilmember Kastein asked for clarification that the documents must be produced and reviewed at the time a person was hired. City Attorney Roy stated federal law required the I-9 verification of legal employment status to be done within three days of the date of hire. The employer must retain the I-9 form for a specified retention period and it was optional whether to retain the identification documents (what was presented by the applicant to verify legal employment status). Councilmember Kastein asked what HB 1343 required for the I-9 and identification documentation. City Attorney Roy stated HB 1343 did not address the I-9 requirement and this was set forth in the federal law. Under HB 1343, prior to executing a public contract for services, each prospective contractor was required to certify that at the time of the certification it did not knowingly employ or contract with an illegal alien and that the contractor has participated in or attempted to participate 266 March 6, 2007 in the basic pilot program in order to verify that it does not employ any illegal aliens. The basic pilot program referenced in the state law was authorized under federal law and was a means of verifying after the fact of employment and at the time of entering into a public contract that the contractor was not employing illegal aliens. Councilmember Kastein asked if the local ordinance would require the contractors to "jump through any additional hoops" beyond those specified in HB 1343 i.e., would there be any additional requirement besides holding on to the records for a year. City Attorney Roy stated nothing additional was being required in terms of verifying identification. The ordinance would require the retention of documents that neither the federal or state law required to be maintained and would require that subcontractors had complied with federal law. The contractors would also be required to cooperate with the City to verify legal employment status if there was a complaint or an audit. Councilmember Kastein stated it appeared that the main additional requirement was for contractors to verify that the subcontractors were following the law. City Attorney Roy replied in the affirmative and stated the ordinance would not impose any additional burden on employees. There would be an additional burden for contractors to certify that they and their subcontractors had gone through the necessary steps required by federal law to verify the legal employment status of their employees. Councilmember Kastein asked if the contractor must retain the records for the subcontractors. City Attorney Roy stated each contractor and subcontractor must retain their respective records. The contractors must request from the subcontractors the documents relied upon for verification of legal employment status and then make the required certification. Councilmember Kastein asks if the contractor would be required to produce the subcontractor's documentation if the City did an audit. City Attorney Roy stated this issue would need to be addressed if the ordinance was adopted on First Reading. The subcontractor would be required to retain the records and make them available for inspection. Councilmember Weitkunat stated the I-9 form was standard practice for all organizations. It was difficult for the average person to know whether identification documents were valid. Certification and verification raised new questions for employers. She asked if the "certification" would be a legal statement. City Attorney Roy stated a certification was not necessarily the same thing as an affidavit. The certification would be a statement that the required verification had occurred. Councilmember Weitkunat stated it was difficult for small businesses to know that workers were providing legitimate documents. The problem in Fort Collins included university students who were here legally but were not allowed to work. Enforcement was difficult. City Attorney Roy stated under the federal law, the I-9 form must be retained in the case of recruiting or referral for a fee, without hiring, for three years after the date of recruiting or referral and in the case of hiring for three years after the date of hiring or one year after the date the individual's employment is terminated, whichever is later. Councilmember Brown stated the key word was "knowingly" hiring someone with false ID. He asked who would be responsible for a subcontractor knowingly hiring unauthorized aliens. He 267 March 6, 2007 assumed the contractor would not be held responsible because the subcontractor would have presented a certification. Jim O'Neill, Purchasing Agent, stated the City's contract would be with the contractor rather than the subcontractor. City Attorney Roy stated the City was specifically preempted from imposing a civil or criminal penalty on an employer for knowingly hiring an unauthorized alien. A fine would be possible for falsely identifying someone if there was an investigation of a complaint or falsely certifying that the documents had been reviewed. The City would have to bring an action against the subcontractor rather than the contractor if the contractor was not found to have falsely identified someone or employed an illegal alien. The City would have recourse against the contractor if the contractor failed to remedy the problem with the subcontractor within the requisite period of time. Councilmember Brown asked if the City would become involved if a contractor for a City project was caught employing illegal aliens within another jurisdiction. City Attorney Roy replied in the negative. Councilmember Manvel noted that many of the speakers spoke in support of HB 1343. He asked if the City was bound to follow HB 1343. City Attorney Roy stated there was a question regarding whether HB 1343 applied to construction contracts and that to this point the City had taken the position that it did not apply to construction contracts, although the State Controller had taken a contrary position. There was also a question about whether HB 1343 constituted an unfunded State mandate, and if it does, whether compliance was optional for the City. Councilmember Manvel stated he wanted to make it clear that the City had quite a bit of latitude on this. Councilmember Kastein asked if the City found that a contractor was in violation of the proposed ordinance and the contract was terminated, whether the City would pay for the work done to that point. City Attorney Roy replied in the affirmative. The City would be entitled under the ordinance to recover any consequential damages of having to terminate the contract and contracting with someone else. Councilmember Kastein asked for the rationale for setting $100,000 and $500,000 thresholds. O'Neill stated approximately 62% of City service and construction contracts were at those levels. Deputy City Manager Jones stated staff also considered the feasibilityof doing audits and responding to written complaints. Staff had determined these thresholds would "capture" most of the City's major contracts. Councilmember Kastein noted that HB 1343 did not set a threshold and that all government contracts were covered under that legislation except construction. Mayor Hutchinson asked if one of the rationales for the thresholds was the amount of workload. Deputy City Manager Jones stated staff looked at the practicality of doing audits and responding to written complaints and looked at the dollar amounts of the current contracts. Staff was looking at the staff s capacity to do the work and capturing most of the large service and construction contracts. 02 March 6, 2007 Councilmember Kastein asked about the possibility of "frivolous complaints" and contractors using the complaint process against each other. He asked if there was any way to avoid allowing complaints. City Attorney Roy stated there had been concerns that the verification process under the federal law and this ordinance could give rise to discrimination, and this was the reason the federal law included a provision similar to a provision in the proposed ordinance specifically prohibiting discrimination. Both laws then built on that by saying that in the instance of complaints none would be investigated if based on a discriminatory kind of allegation i.e., there must be facts supporting the complaint. It would be possible to write this ordinance without a specific reference to complaints although all City ordinances were subject to investigation with regard to potential violations and those generally were based on complaints. If there was no specific provision dealing with complaints in the ordinance this could lead to improper kinds of complaints that the City wanted to guard against. Councilmember Kastein asked if the intent was to "set the bar very high" with regard to the complaint process. City Attorney Roy replied in the affirmative. Councilmember Kastein asked if legal staff had time to research all of the facets required or if more time was needed. City Attorney Roy stated he did not believe that more time would be helpful to the staff analysis or the drafting of the ordinance. He had conferred with an immigration attorney in preparing and researching the ordinance. Staff did its best to draft an ordinance that met Council's needs and was legally defensible. Immigration law was extremely complex and more time would not change that. Councilmember Kastein asked if other cities had enacted similar ordinances. City Attorney Roy stated he was not aware of any in Colorado. Some cities around the country had enacted ordinances relating to regulation of members of the public regarding harboring illegal immigrants. One other city had enacted a similar ordinance. Jenny Lopez-Filkins, Assistant City Attorney, stated Suffolk County, New York had enacted an ordinance that was similar to the proposed City ordinance but no litigation had been forthcoming when she last spoke with the Suffolk County Attorney. Councilmember Kastein asked about the intent behind HB 1343 covering "service contracts" and noted that the City was going further than that to include construction contracts i.e., he wanted to know whether the state law really intended to include construction contracts under "service contracts." Lopez-Filkins stated the State Controller's Office produced a question and answer document that indicated that capital construction contracts were "service contracts" without offering any explanation on that point. Councilmember Kastein asked about the role of the State Controller's Office with relation to the legislature. Lopez-Filkins stated the State Controller audited monies and dealt with finances between State agencies and others. Councilmember Kastein asked if the State Controller's position was considered to be clarification of HB 1343. City Attorney Roy stated the State Controller's position was not binding on municipalities and the majority of municipalities he had contacted had construed the term "contract for services" in the same way the City of Fort Collins had i.e., that the term did not apply to construction contracts. 269 March 6, 2007 Councilmember Manvel noted the cost for enforcement would vary depending on a number of factors. He asked if there was anyway to know whether this would change anything in terms of who was employed by City contractors. He asked if the City had any evidence of employment of illegal aliens by City contractors at this time. O'Neill stated there had not been any complaints by contractors about other contractors. Contractors had indicated to him that they were trying to follow the federal law by looking at I-9 forms. One complaint filed last year was based on "national origin" and would not have come forward under this ordinance. When that complaint was investigated the City determined that the people hired did have proper documentation. Councilmember Kastein asked how the audit process would work in the case of a contractor with many subcontractors and many employees. City Attorney Roy stated under the ordinance it would not be the task of City employees to actually determine whether or not a particular employee was eligible for employment in this country. The City would be checking to see whether or not the contractor could produce paperwork verifying that the contractor had complied with federal law in attempting to determine whether employees were eligible for employment. The City would be looking at the contractor's compliance rather than at the legal employment status of the individual employee. Deputy City Manager Jones stated it would take time to set up an audit process for a specific contractor. The City would likely go through records on -site and an analysis would then have to be done. O'Neill stated the City would ask for payroll records regarding the City job and could audit a sampling of the subcontractors. Councilmember Kastein asked for more clarification about what it would mean to audit "on -site." Deputy City Manager Jones stated the City may have to go on -site to access the records to determine compliance with federal law. Councilmember Kastein asked if "on -site" meant at the corporate headquarters rather than at the job site. Deputy City Manager Jones replied in the affirmative. Councilmember Kastein asked what would happen in the case of an undocumented worker who was paid when no records would be kept of that transaction. City Attorney Roy stated the task would be to match workers with papers to determine whether the contractor had in fact reviewed papers for the people working on the job. This could entail an in -person identification of the person (false identification) or a review ofpaperwork. O'Neill questioned whether the City or anyone would have the right to ask for identification on a job site. City Attorney Roy believed that this could be done if an individual was employed on the City's job site. Mayor Hutchinson asked if the staff estimate of the work required to do an audit was based on examining the records. His understanding had been that there would be matching of "faces" to records. Deputy City Manager Jones stated the estimate was based onlooking at the paperwork i.e., matching the paperwork with the identification records in the files. Councilmember Manvel noted HB 1343 required certain provisions in contracts for services and asked if the City was now doing that with service contracts i.e., whether the City was complying with HB 1343 for new contracts. O'Neill stated a statement was included in all service agreements to comply with State law. 270 March 6, 2007 Councilmember Manvel asked if that was being done only in "service contracts" or if it was being done in all contracts. O'Neill stated it was being done in all "service contracts." City Attorney Roy stated the ordinance would impose a burden on the contractor or the subcontractor to identify the employees working on the site. City employees would not be put in the position of approaching workers individually. Councilmember Manvel asked for confirmation that the contractor would keep a copy of the documentation that was reviewed for I-9 verification and whether this would raise some questions about identity theft. O'Neill stated the City had heard this concern from some City contractors. Councilmember Ohlson made a motion, seconded by Councilmember Brown, to adopt Ordinance No. 045, 2007 on First Reading. Councilmember Ohlson stated his name was closely associated with initiating this ordinance and that he had heard from many people opposed to the ordinance. One "common theme" was that many people did not understand his "politics." He was not "to the right of the KKK" on this and people from all political persuasions including the "center and left" had issues and concerns about illegal immigration. Many different people were concerned about the effects of illegal immigration to the countries of origin and to the United States. The federal and state governments had "failed to act" and there was no indication they would "do anything responsible any time soon." The State law had "many holes in it." Local governments often had to act to get the states and the federal government to act. The essence of the ordinance was that City dollars and jobs on City projects should go to legal workers, most of whom will be local residents. He would stand by this intent. This had to be extended to subcontractors because much of the work on large City projects was done by subcontractors. There were misconceptions about the cost of enforcement. He understood that the cost for the 3-6 possible audits were for people already on the City payroll i.e., that work would be absorbed by the current structure. This would not take money from other things such as Dial -a -Ride. The ordinance would largely be "self -enforced" because contractors would not want to risk losing a large City contract. The local ordinance would have "real consequence" while the federal and state laws did not. Everyone should be concerned about a "flawed status quo situation" with regard to illegal immigration and the impacts of "deflating wage rates" for working people in this country (including legal workers and minority populations). Moderates should speak up on the issue of illegal immigration. The United States, with a population of 300 million, could not be the "sponge for the rest of the world." The City government had a role in determining that City dollars and jobs should only go to legal workers. Councilmember Brown stated the federal and state laws were "paper tigers" without any "teeth." The City ordinance would be stronger and would send a message to the State legislators and the federal government that this problem needed to be addressed. There would be costs for not implementing this ordinance and there would be costs if the country continued to allow illegal immigrants to "take jobs away from legitimate citizens." This was not an issue of "discrimination" and it was an issue of "leveling the playing field" for contractors doing work for the City. A contractor who hired illegal immigrants in order to underbid the competition should not do work for the City. Those working for the City should be "treated fairly" when they bid a contract. 271 March 6, 2007 Councilmember Weitkunat stated she "strongly disagreed" with Councilmembers Ohlson and Brown. This was a "governance" issue and this was a federal government issue. She questioned whether local government should be in the business of "strengthening state and national laws" through the enactment of local laws. Another "layer of bureaucracy" was not needed to enhance what was already law. The State adopted FIB 1343 less than a year ago and the impacts and "repercussions" of that law were not yet known. She did not believe there was a need for local government to push for stronger enhancement of state and federal law. Citizens had other means to convey their thoughts to federal and state government. Mayor Hutchinson stated he did not see a WHEREAS clause that indicated this was all about controlling illegal immigration. He noted the City Attorney had advised the Council that there was a "line" that should not be crossed and that there had been several references to "preemption." City Attorney Roy stated it was permissible for Councilmembers to have positions with regard to the enforcement of national immigration laws. The local ordinance was about addressing City practices regarding its contractors. Mayor Hutchinson stated there was confusion that the ordinance was trying to address the illegal immigration problem. City Attorney Roy stated this would be a topic for Council discussion. The purpose of the ordinance was stated in the WHEREAS clauses and had to do with addressing a matter of local concern. It was not an attempt to regulate immigration and was an attempt to regulate the manner in which the City contracts for services. Councilmember Ohlson stated his statement was that the ordinance was in essence about City jobs and tax dollars going to legal workers, many of whom will be from the local area. The context was the national discussion about illegal immigration. He brought forth this issue because be believed that City jobs and tax dollars should go to legal workers. Mayor Hutchinson stated there was confusion about the call to have local government act about the national immigration law. Councilmember Ohlson stated the context was that when the federal and state govenunents failed to act, it was the job of the City government to act to ensure that City contracts and jobs would go to legal workers. Councilmember Manvel stated the State law had the same provision as the proposed ordinance about losing the contract. Councilmember Ohlson stated the State had no intention of taking action under that provision. The "real penalty" under the City ordinance would be an inability to bid on City projects for up to five years. It was unlikely that the City would cancel an existing contract in the middle of a project. Councilmember Manvel believed the City would be willing to cancel a service contract and go to another service provider. Councilmember Roy stated he did not support the ordinance because it would be "a law to enforce a law to enforce a law." This would be "governance at its worst." Municipalities across the country 272 March 6, 2007 were attempting to work through a national issue in the context of "City boundaries and townships." There was no ability at the local levels to create a "cohesive plan" to deal with the national issue. There was a need for a "coherent national policy." Local efforts were "fracturing the discussion" and making it more difficult to find a solution that would work for the long term. There had not been any analysis showing the costibenefit of this ordinance. There needed to be a discussion at the national level. Councilmember Kastein stated this was a complicated issue. The local ordinance would expand on existing law and would include construction contracts under "service contracts." It would also require contractors and subcontractors to retain their documentation. He agreed with the principles of HB 1343 and would support this ordinance. He did not like it being part of a "political agenda." The ordinance would create no additional work for contractors and subcontractors beyond holding onto the documentation. He would support the ordinance even though he had some concern about how it was being "leveraged." Councilmember Manvel stated he was looking at this from a cost/benefit standpoint, whether it would solve problems, and whether it would create new problems. There was no evidence that there was a lot of employment of illegal workers in City contracts and subcontracts. The cost would be that the City workers needed to work on enforcement would not be doing something else they should be doing. He was willing to ask City workers to do more only if he saw a "real pay-off' for it. It may be possible to address this without an ordinance by making policies regarding whether or not to pay attention to the State law and whether construction contracts should be included under service contracts. This ordinance could lead to "profiling" as contractors worked toward compliance with the law. The federal system for checking documentation was "very poor" and contractors may choose not to hire anyone who "looks Hispanic." He would not support the ordinance. Councilmember Ohlson stated he did not have a "political agenda" on this issue. He wanted people to understand that it was possible to take a position on illegal immigration without being "to the right." Councilmember Roy stated he did not have a political agenda on this issue. Councilmember Kastein stated the goal for the Council should be what was best for the City and that in some cases it made sense to talk about issues that were "bigger than Fort Collins" and in some cases it did not make sense. On this issue the Council was "nibbling at the leaf' when the root of the problem was out there. Mayor Hutchinson stated there would be more required by this ordinance than keeping records. The City would be doing something that it was not "equipped" to do. This issue was difficult to understand and the Council was taking on something that he "totally agreed with in principle" but was difficult to understand even after concerted study. He questioned whether it was the business of the City to do this and that he did not believe that it was an appropriate role for the City. There was no information about the scope of the problem. The vote on the motion was as follows: Yeas: Councilmembers Brown, Kastein and Ohlson. Nays: Councilmembers Hutchinson, Manvel, Roy and Weitkunat. 273 March 6, 2007 THE MOTION FAILED. Councilmember Kastein asked if the City's position would continue to be that construction projects were not covered by the HB 1343. City Attorney Roy stated absent some direction from the majority of Council, it would be up to the City Manager as the person who administers contracts, to make that determination. To date, the decision had been to not apply it to construction contracts. This was the prerogative of the City Manager or Council could provide direction. Councilmember Kastein requested a one -page memo on the implications of applying HB 1343 to construction contracts. City Attorney Roy stated staff could provide a memo to Council on that subject. Mayor Hutchinson stated he would support receiving such a memo. He had an issue with the City dispatching teams for on -site audits. Councilmember Weitkunat stated, as noted by Councilmember Manvel, there were ways the State law could be strengthened through City policy. She preferred stronger policy direction rather than new laws. Adjournment The meeting adjourned at 10:40 p.m. Mayo ATTEST: IEnI , 274