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HomeMy WebLinkAboutMINUTES-07/05/2011-RegularJuly 5, 2011 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, July 5, 2011, 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: Horak, Kottwitz, Manvel, Ohlson, Poppaw, Troxell and Weikunat. Staff Members Present: Atteberry, Krajicek, Roy. Agenda Review City Manager Atteberry stated the funding source for Item No. 11, Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water.Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project, has been changed from the General Fund Reserve to the Water Fund since First Reading. Council has received a revised version of Item No. 28, Resolution 2011-057 Establishing a Process for Enhancing Communication Between the City Council and the Council -Appointed Platte River Power Authority Board Member. Citizen Participation Cheryl Distaso, Center for Justice, Peace, and Environment, discussed Character Fort Collins and its relationship with the City. She urged Council to waive attorney -client privilege with regard to the report written by the attorney hired to investigate the relationship. Andrea Agnew, Stonecrest Drive, discussed the exoneration of Tim Masters and showed a video regarding the issue. Eric Sutherland, 3520 Golden Currant, discussed the Tim Masters case and opposed Police Services' handling of the issue. Ken Correia, 327 Brinn Court, requested an emergency vote regarding interim licenses for medical marijuana infused product businesses. Stacy Lynne, 216 Park Street, discussed constitutionalism. Ellen Thompson, Fort Collins resident, continued Ms. Lynne's statement regarding constitutionalism. Amish Patel, 1303 Sunflower, supported mobile` vendors in the City and encouraged Council to begin regulating and supporting the food truck culture. 356 July 5, 2011 Josh Kerson, 2814 West Vine Drive, supported the use of electric bicycles on the City's multi -use trails. , Bob Overbeck, Fort Collins resident, discussed the Smart Meter program and asked for additional data regarding the benefits of Smart Meters. Sarah Burnett, 714 Gilgalad Way, expressed concern regarding the Development Review appeal process. Terri Williams, 2018 Niagra Court, opposed the Smart Meter program. Virginia Farver, 1214 Bellview Drive, opposed the Smart Meter program. Bruce Lockhart, 2500 East Harmony Road, opposed various City expenditures. Rosemary VanGorder, 3508 Shore Road, expressed concern regarding the criminal justice system and the School Resource Officer program. Mel Hilgenburg, ' 172 North College, thanked the City for the. Fourth of July celebration and discussed the location of the Greeley/Bellvue pipeline. He requested safety signage on multi -use trails. Citizen Participation Follow-up Councilmember Horak rebutted Mr. Lockhart's comments regarding votes. Councilmember Kottwitz asked for more information regarding food trucks and suggested changing the 4 inch width language on the electric bicycle regulations. She asked for information regarding medical marijuana infused products. City Attorney Roy replied there is no prohibition against medical marijuana centers dispensing edibles; however, the ability to manufacture edibles in Fort Collins has been affected by state law. He stated staff would determine the State's position and report back to Council as soon as possible. Councilmember Poppaw asked about the Poudre Valley Health Systems contribution for the Fourth -of July celebration. City Manager Atteberry replied PVHS has been sponsoring the event for the past several years and the amount was between $25,000 and $40,000. Councilmember Troxell asked for further information regarding mobile food vendors. Mayor Pro Tern Ohlson rebutted Mr. Lockhart's comments as being inaccurate. Mayor Weitkunat noted a work session regarding the Smart Meter program will occur following the URA meeting this evening. She asked for a response regarding the development review appeal process. City Attorney Roy replied the City Code does not speak to the role of the staff report; staff typically provides!an analysis of the allegations in the notice of appeal. All parties -in -interest are 357 July 5, 2011 given the opportunity to respond to the staff" report at the appeal hearing. Council has the prerogative to change staff's role to simply being available for questions rather than provide a staff report. CONSENT CALENDAR 6. Consideration and Approval of the Minutes of the June 7, 2011, Regular Meeting. 7. Second Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. This Ordinance, unanimously adopted on First Reading on June 7, 2011, appropriates unanticipated Cultural Development and Programming ("CDP") revenue and prior year reserves for the CDP accounts and prior year reserves for the Convention and Visitors Bureau. Lodging tax revenues in 2010 were $22,252 short of revenue projections; however, there are Lodging tax reserves from unspent appropriations in the amount of $113,066 available to be appropriated in the General Fund. In addition, $2,800 of unanticipated CDP revenue was received in 2011 which will be appropriated into the Cultural"Development and Programming accounts. 8. Second Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non -Exclusive Storm Drainage Easement on City Wastewater Utility Property Including_a Portion of Prospect Ponds Natural Area. Larimer County has a current construction project at the Larimer County Detention Center Campus, located on Midpoint Drive. This project includes an Alternative Sentencing Division building, an addition to the existing Sheriff's Administration building, and an addition to the existing Community Corrections Facility. In addition, there will be parking lot modifications and site improvements. With these changes, the project will include an on - site detention pond. This Ordinance, unanimously adopted on First Reading on June 7, 2011, will grant a permanent utility easement for a 30-inch underground stormwater pipe to convey the detained runoff to Skunk Pond, which is part of Prospect Ponds Natural Area. 9. Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. Second Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. Second Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. 358 July 5, 2011 Ordinance No. 068, 2011, authorizes the donation of a 1.75 acre parcel along the Poudre River from Larimer County to the City Natural Areas, Program. The property is located adjacent to the north end of Arapaho Bend Natural Area. Ordinance No. 069, 2011 authorizes the donation of a three acre parcel located adjacent to Running Deer Natural Area, south of East Prospect.Road, from Mike Sollenberger to the City Natural Areas Program. Both Ordinances were unanimously adopted on First Reading on June 7, 2011. 10. Second Reading of Ordinance No. 074, 2011, Appropriating Funds From the City's General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce. This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan from the City to the Urban Renewal Authority (URA) to reimburse Kaufinan and Robinson, Inc for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City's Interfund Borrowing program that was formally added to the City's investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. 11. Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project. This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan in the amount of $3 million from the City to the Urban Renewal Authority (URA) to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins' Water Fund Reserves to the URA will be $3 million and reimbursed to the project for the On -Site public improvements. Staff originally intended to request the funds from the City's General Fund reserves however, after discussions with the Finance department, Utilities and the Attorney's office, the request changed to the Utilities Water Fund reserves to ensure the URA was not overburdening the General Fund reserves. Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, 359 July 5, 2011 assuming that staff -projected rate increases are implemented. The Ordinance provides that it is the Council's intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the,loan to the Water Fund to meet that need It is anticipated that the URA will issue bonds within the next few years, and in that event, the loan from the Water Fund would be repaid at that time. 12. First Reading of Ordinance No. 076, 2011, Appropriating Unanticipated Revenue in the General Fund for the Purchase, Training and Ongoing Maintenance of the E911 and Emergency Dispatch Systems at Fort Collins Police Services Dispatch Center. Larimer Emergency Telephone Authority provides funds to the Fort Collins Police Services to be used for equipment and training to process E911 calls. This Ordinance appropriates those funds. 13. First Reading of Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Licht and Power Appropriations into the Light and Power Utility Relocation Capital Project. This Ordinance appropriates capital project funding for the Utilities to relocate existing electric, water and wastewater facilities to accommodate the Mason Corridor Bus Rapid Transit (BRT) Project. Light and Power will also supply power to the bus stations along the corridor. The Utilities are being viewed by the MAX/BRT Project as independent contractors and will be reimbursed by the MAX/BRT Project funds for the relocation expenses upon completion. The MAX/BRT Project will also pay for the cost of electric power supply to the bus stations. The Ordinance provides new capital appropriations in the Light Power Fund ($620,000), Water Fund ($625,000) and.Wastewater Fund ($1,150,000) for the relocation work. Following completion of the construction, the Utilities will invoice the MAX/BRT Project based on actual costs and will receive the unanticipated revenue being appropriated by the Ordinance. In addition to electric duct bank relocation, Light and Power will use this opportunity to upgrade the capacity of the duct bank. These system upgrade costs have been budgeted in Light and Power's existing 2011 lapsing appropriation. The Ordinance transfers $400,000 of the existing Light and Power lapsing budget into the new BRT electric relocation/upgrade capital project. The costs of the upgrade will not be reimbursed by the MAX/BRT Corridor Project. 14. Items Relating to the Hughes Stadium Disc Golf Course. A. Resolution 2011-053 Authorizing the City Manager to Enter Into a Grant Agreement with Great Outdoors Colorado for Funds for a Disc Golf Course at Hughes Stadium. 360 July 5, 2011 B. First Reading of Ordinance No. 078, 2011, Appropriating Unanticipated Grant and Other Revenue in the Conservation Trust Fund for the Hughes Stadium Disc Golf Course. Great Outdoors Colorado has awarded the City an $85,000 grant for the completion of the Hughes Stadium Disc Golf Course. The project involves the development of an 18-hole disc golf course at Hughes Stadium in conjunction with Colorado State University. The course is primarily located in the stormwater detention basin directly west of Overland Trail Road. The course will include new trees and shrubs, a new access road off County Road No. 42C, and the course tee areas and baskets. 15. Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26 and to Standards for Interconnection of Electric Generation Facilities. A. First Reading of Ordinance No. 079, 2011, Making Certain Amendments to Chapter 26 of the City Code Pertaining to the Provision of Net Metering Service and Certain Definitions Related Thereto. B. First Reading of Ordinance No. 080, 2011, Amending Various Provisions of the City Code and the Land Use Code Pertaining to the Definition of General Manager. C. First Reading of Ordinance No. 081, 2011, Making Certain Amendments to Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System The Fort Collins Utilities Light and Power Department is proposing minor revisions to the definitions section of Article I and to the Electric Article of Chapter 26 of the City Code and the Land Use Code. These revisions include updating the definition of General Manager, clarification regarding the provision of net metering service and clarification regarding authority to execute interconnection or parallel generation agreements on behalf of the City. Light and Power is also recommending adding clarifying language to the City's indemnification and insurance requirements contained in the City's Interconnection Standards. These standards govern operational and other requirements for interconnection generating facilities to the City's electric distribution system. 16. First Reading of Ordinance No. 082, 2011, Calling a Special Municipal Election to Be Held in Conjunction with the November 1, 2011 Larimer County Coordinated Election. This Ordinance calls a Special Municipal Election to be held in conjunction with the November 1, 2011 Larimer'County Coordinated Election, and preserves the opportunity for Council to place initiated or referred issues on the November ballot. If Council decides to place any measures on the ballot it would need to do so no later than at its August 16 meeting. If Council does not take action by ordinance or resolution before the statutory deadline (September 2) to certify ballot language to Larimer County, the election will be cancelled and the provisions of this Ordinance will be of no further force and effect. 361 July S, 2011 This Ordinance does not submit a specific measure to the November 1, 2011 ballot. However, a group of citizens is currently circulating an initiative petition proposing a prohibition on the establishment, operation or licensing of medical marijuana centers, optional premises cultivation operations, and medical marijuana -infused product manufacturing within the city of Fort Collins. The deadline to submit the petition to the City Clerk's Office is July 19, 2011. Adoption of this Ordinance is a required step in preserving the option for City Council to submit the initiated ordinance, and/or any other ballot measures that Council may desire, at the November 1, 2011 Coordinated Election. 17. Items Relating to the Access Road at Soapstone Prairie Natural Area. A. First Reading of Ordinance No. 083, 2011, Authorizing the Transfer to Larimer County of Public Right -of -Way Easements Acquired by the City for the Reconstruction of Rawhide Flats Road. B. First Reading of Ordinance, No. 084, 2011, Authorizing the Conveyance of Access Easements to Three Private Land Owners within the Soapstone Prairie Natural Area. To complete the process of improving Rawhide Flats Road, the City has requested that Larimer County vacate sections of road right-of-way that were abandoned in 2008 when the road was realigned and reconstructed by the City to provide access to Soapstone Prairie Natural Area. The County conditioned its approval of the road improvements on the City's follow up to request this vacation in order to stop the unnecessary public use of the old abandoned road areas and to allow the land to revert to the surrounding landowner(s). Once the sections of right-of-way are vacated, the ownership will revert to the adjacent landowners. In connection with the vacation of the unneeded sections of right-of-way, the City is proposing to transfer to the County six new right-of-way easements that the City acquired to build the realigned portions of the improved road. This transfer will establish that the easements are held by Larimer County as public road easements for Rawhide Flats Road along with the other segments of the Road, and that the right-of-way being vacated is no longer needed. The City has also asked the County to vacate any remaining public road rights -of -way within Soapstone Prairie Natural Area. This action will establish that Rawhide Flats Road north of the Natural Area boundary line is a private road owned by the City for the sole purpose of providing access to Soapstone Prairie Natural Area. There are currently three property owners with in -holding properties within Soapstone Prairie Natural Area. When this section of Rawhide Flats Road is vacated, these owners will lose their legal access to their properties. In order to continue to provide these owners legal access to their property, the City will need to grant each owner an access easement from the boundary of the Natural Area to their property line. The access easements will follow the same alignment as the existing road on the Soapstone Prairie Natural Area. 362 July S, 2011 18. First Reading of Ordinance No. 085, 2011, Authorizing the Conveyance to Capstone Development Corporation of Three Easements on Stormwater Utility Property at Creekside Park. Capstone Development Corporation ("Capstone") is planning a mixed use development. This Project area is 10.4 acres and is located near Stuart Street and College Avenue. It fronts College Avenue around the Discount Tire property and continues to the west to the railroad. The project area is also at the rear of the Dairy Queen property. This mixed use development is for student housing and retail space. It will have two buildings, 221 dwelling units and 8,000 square feet of new retail space. The retail space will be the first floor of the building fronting on South College Avenue. For this development, Capstone has requested that the City grant Capstone a drainage easement for construction of a new flood control channel, a drainage easement for sheet flows from the adjoining property, and a temporary construction easement to construct a pedestrian trail and an underground stormwater pipe on City -owned property known as Creekside Park. 19. First Reading of Ordinance No. 086, 2011, Authorizini? the Conveyance to Solitaire Homes, LLC of a Public Trail Easement on City Property. Solitaire Homes, LLC (the "Developer") is planning a 27 acre (approximately) development north and west of Laporte Avenue and Taft Hill Road, opposite the Poudre School District offices. To facilitate a planned trail within the development, the Developer requests a 438 square foot public trail easement from the City across City property managed by the Water Utility. The City property is approximately 1,750 square foot. in size and is the site of a Water Utility valve vault. 20. Resolution 2011-054 Naming Three Alleys Within the Block Bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street. The Downtown Development Authority (DDA) is preparing a capital improvement project to enhance three alleys in the block bounded by.South College, West Laurel, South Mason and West Olive. In conjunction with this project, the City of Fort Collins is preparing to name these three alleys. The three proposed names are "John Coltrane Alley," "Ella Fitzgerald Alley" and "Billie Holiday Alley." The selection of these three names is based on a public outreach process that resulted in a winning theme of eclectic music and art. If approved, the alley naming will simplify way -finding for pedestrians, bicyclists, drivers, delivery personnel and emergency responders. 21. Resolution 2011-055 Authorizing the Mayor to Execute an Amendment to the Intergovernmental Agreement with the Fort Collins Urban Renewal Authority. At the June 7, 2011 meeting, Council requested the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize 363 July 5, 2011 the requirement that, when the City advances funds to the URA in support of the URA's activities, a loan agreement and promissory note accompany the advance of funds. 22. Resolution 2011-056 Making an Appointment to the Citizen Review Board. A vacancy currently exists on the Citizen Review Board due to the resignation of Evan Singleton. Councilmembers Gerry Horak and Ben Manvel and City Manager Darin Atteberry reviewed the applications on file. The interview team is recommending Robert Springer to fill the vacancy with a term to begin immediately and set to expire on December 31, 2013. ***END CONSENT*** Ordinances on Second Reading were read by title by City Clerk Krajicek. 7. Second Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. 8. Second Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non -Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. 9. Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. Second Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. Second Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. 10. Second Reading of Ordinance No. 074, 2011, Appropriating Funds From the City's General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufinan and Robinson, Inc. Project at 1330 Blue Spruce. 11. Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project. 26. Second Reading of Ordinance No. 071, 2011, Approving the Waiver of City Fees for the CARE Housing Affordable Housing Project in the Provincetowne Subdivision. 364 July 5, 2011 Ordinances on First Reading were read by title by City Clerk Krajicek. 12. First Reading of Ordinance No. 076, 2011, Appropriating Unanticipated Revenue in the General Fund for the Purchase, Training and Ongoing Maintenance of the E911 and Emergency Dispatch Systems at Fort Collins Police Services Dispatch Center. 13. First Reading of Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Light and Power Appropriations into the Light and Power Utility Relocation Capital Project. 14. First Reading of Ordinance No. 078, 2011 Appropriating Unanticipated Grant and Other Revenue in the Conservation Trust Fund for the Hughes Stadium Disc Golf Course. . 15. Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26, and to Standards for Interconnection of Electric Generation Facilities. A. First Reading of Ordinance No. 079, 2011, Making Certain Amendments to Chapter 26 of the City Code Pertaining to the Provision of Net Metering Service and Certain Definitions Related Thereto. B. First Reading of Ordinance No. 080, 2011, Amending Various Provisions of the City Code and the Land Use Code Pertaining to the Definition of General Manager. C. First Reading of Ordinance No. ,081, 2011, Making Certain Amendments to Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System 16. First Reading of Ordinance No. 082, 2011, Calling_a Special Municipal Election to Be Held in Conjunction with the November 1, 2011 Larimer County Coordinated Election. 17. Items Relating to the Access Road at Soapstone Prairie Natural Area. A. First Reading of Ordinance No. '083, 2011, Authorizing the Transfer to Larimer County of Public Right -of -Way Easements Acquired by the City for the Reconstruction of Rawhide Flats Road. B. First Reading of Ordinance, No. 084, 2011, Authorizing the Conveyance of Access Easements to Three Private Land Owners within the Soapstone Prairie Natural Area. 18. First Reading of Ordinance No. 085, 2011, Authorizing the Conveyance to Capstone Development Corporation of Three Easements on Stormwater Utility Property at Creekside Park. 19. First Reading of Ordinance No. 086, 2011, Authorizing the Conveyance to Solitaire Homes, LLC of a Public Trail Easement on City Property.. 365 July 5, 2011 27. Items Relating to the Fort Collins Museum/Discovery Science Center Project. A. First Reading of Ordinance No. 087, 2011, Appropriating Prior Year Reserves in the General Fund for Transfer to the Capital Projects Fund for the Fort Collins Museum/Discovery Science Center Project. B. First Reading of Ordinance No. 088, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Fort Collins Museum/Discovery Science Center Project. C. First Reading of Ordinance No. 089, 2011 Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Exhibits of the Fort Collins Museum/Discovery Science Center Project and Appropriating Unanticipated Revenue in the Capital Projects Fund. Councilmember Troxell withdrew Item No. 20, Resolution 2011-054 Naming Three Alleys Within the Block Bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street. Eric Sutherland, 3520 Golden Currant, withdrew Item Nos. 15 and 21, Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26, and to Standards for Interconnection of Electric Generation Facilities, and Resolution 2011-055 Authorizing the Mayor to Execute an Amendment to the Intergovernmental Agreement with the Fort Collins Urban Renewal Authority. Bruce Lockhart, 2500 East Harmony Road, withdrew Item Nos. 10, 11, and 13, Second Reading of Ordinance No. 074, 2011, Appropriating Funds From the City's General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authorityfor the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce, Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authorityfor the North College Marketplace Project, and First Reading of Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Light and Power Appropriations into the Light and Power Utility Relocation Capital Project. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt and approve all items not withdrawn from the Consent Calendar. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 366 July 5, 2011 Staff Reports City Manager Atteberry stated Forbes.com has ranked Fort Collins as the fifth best city for business and careers. Fort Collins was also ranked as the second best bicycling city in The Atlantic. Councilmember Reports Councilmember Troxell stated he attended the Colorado Municipal League (CML) annual conference with Councilmembers Poppaw and Horak and Mayor Weitkunat. He congratulated Mayor Weitkunat on her election to the CML Executive Board. Mayor Weitkunat stated CML is the statewide umbrella for municipalities' shared advocacy and provides tremendous networking opportunities. Mayor Pro Tem Ohlson discussed the Finance Committee action to move forward expansion and retention packages for Avago and Solix. Ordinance No. 071, 2011, Approving the Waiver of City Fees for the CARE Housing Affordable Housing Project in the Provincetowne Subdivision Adopted on Second Reading The following is staff s memorandum for this item. "EXECUTIVE SUMMARY Under Colorado statute and City of Fort Collins ordinances and resolutions dating back to 1988, the projects of housing authorities are exempt from taxes and fees. For many years, the City has waived building permit and development review fees and some capital expansion fees for projects of the Fort Collins Housing Authority (FCHA), as required by the ordinance. For the most part, these have been relatively small projects. FCHA is currently partnering with the non-profit CARE Housing in a large, multi family affordable housingproject in the Provincetowne subdivision, which is under construction. Fee waivers for this project total $557,378 (outlined in detail in "Financial Impacts " below). This Ordinance was adopted on First Reading on June 7, 2011, by a vote of 6-1 (nays: Ohlson). Based upon Council 's comments and questions during First Reading of this ordinance, staff has added more context, chronology, and explanation regarding affordable housing finance and the request for fee waivers for the Provincetowne, Filing III development. While the City has long been committed to affordable housing, and the need for financial support is clearly demonstrated in the increase in the number of applications for local and federal funds, the fiscal impact of this and future fee waivers for projects in which the FCHA is a partner rather than sole owner warrants some thoughtful evaluation of the waiver situation, and possibly some changes to the City Code. Additionally, considering the current and projected fiscal impact on the Cityfor fee waivers for large projects, clarification for the definition of "ownership " as it pertains ME July 5, 2011 to the Housing Authority and its development partners will be part of the review. This policy issue will be addressed at an upcoming work session: Pending thatpolicy discussion, the City Manager is recommending that Council consider waiving the fees due for the CARE Housing project. BACKGROUND /DISCUSSION CAREHousing(anon profit)boughtaportionoftheProvincetowneprojectsite, locatedatAutumn Ridge Road and Trilby, from KB Homes to fulfill the affordable housing requirement for the entire residential project. This is an 85-unit, $14.9 million townhome rental housing project intended to serve families earning 30%-50% of the Area Median Income (AMI). [Current Fort Collins/Loveland AMI fora family of four is $76, 700. An annual income of $23, 000 = 3016AMI, and $38,350 is 50%AMI]. Funding for the project is a combination ofgrants, Low Income Housing Tax Credits, owner equity, and conventional financing. Provincetowne Funding Sources Amount Low Income Housing Tax Credit Equity $8, 724, 906 Tax Credit Assistance Program American Reinvestment and Recovery Act $1, 609,480 HUD Entitlement Funds — CDBG/HOME $1, 455, 011 City o Fort Collins — Affordable Housing Fund $100, 000 Colorado Division ofHousing $500, 000 Federal Home Loan Bank of Topeka $350, 000 Permanent Loan Financing $2, 060, 000 Deferred Developer Fee $155, 855 Development Total $14,955,252 The financing of affordable housing is complex, especially in today's economic climate. A fifteen year federal tax creditforprivate investors is a critical component of the financial package, and the private investor (J.P. Morgan Chase, in this case) must be a 99% owner. The Housing Authority is technically only a. 001 % participant in this project, but is further involved because it guarantees up to $1.4 million of unanticipated costs. Both the tax credit and the fee waiver are critical components of the Provincetowne project, and elimination of either could jeopardize the project. Historically, the City has waived its fees for other, smaller projects in which the FCHA was a minority partner. However, the magnitude of the fees associated with this project has prompted extensive conversations about the ownership issue and the financial impact that the waiver of fees for the project would have on the City. These conversations began during the building permit application process for Provincetowne. Early on, the assumption was that there should be no distinction between a project that is wholly owned or developed by FCHA, and one in which FCHA has only a fractional participation. However, the magnitude of this proposed fee waiver prompted a re-examination of the City's legal obligation to waive fees for this kind of project. As the legal requirements of state and local law on this subject were further explored, it became apparent that there are two ways to interpret the law on fee waivers for housing authorityprojects. The difference of opinion as to the proper interpretation of the law led to a new series of negotiations with all of 368 July 5, 2011 the parties, including consideration of deferral of the fees for some period of time. But because a compromise could not be reached in the negotiations, the decision was made to seekpolicy direction from City Council. The series of events was essentially as follows. Project Timeline November 2006 CARE Housing purchased the land January 2007 CARE submitted first tax credit application, which was not strong to receive a tax credit award April 2008 CARE began discussions with FCHA about partnership July 2008 FCHA Board of Commissioners approved formal participation intent by resolution August 2008 CARE Housing application for CDBG funds submitted. Fee waivers discussed during pre -application meeting September 2008 CARE Housing and FCHA present application for funding to CDBG Commission. Financing package assumed City waiver of fees January 2009 CARE submitted second tax credit application which included the strength of FCHA as a partner and did include fee waivers April 2009 CARE submitted third tax credit application with additional committed grants and FCHA participation June 2009 Low Income Housing Tax Credit (LIHTC) Reservation awarded by Colorado Housing and Finance Authority (CHFA) November 2010 First building permits requested from the City of Fort Collins. Discussions begin about the proper documentation to show FCHA's ownership interest and the applicability of the FCHA fee waivers Construction begins. January 2011 FCHA learns of City concerns about the fee waivers. Building permits note deferral of fees pending resolution. February 2011 FCHA corresponds with the City about FCHA ownership, Ordinance No. 065, 1999 and Colorado Revised Statutes and continues to believe, based upon the City's response, that fee waivers would extend to Provincetown partnership. 369 July 5, 2011 PDT management and City Manager's office notified about situation. Interdepartmental staff team (including City Attorney's and City Manager's office) undertakes research and development of options, March -May 201 ]Negotiations continue, involving City, FCHA, CARE Housing, and legal representatives A significant component of the financing picture for this project is the expectation by FCHA partners and their lenders that the fee exemption which the Fort Collins Housing Authority is eligible for understate law and the City Code passes to the other funding partners. This includes a waiver of taxes and development review and capital expansion fees as provided in Sec. 7.5-17(1) of the Fort Collins Municipal Code. The degree of the FCHA's ownership of the project has been the subject of considerable discussion, but because of the statutory and municipal code provisions, as well as historic precedent, FCHA and CARE assumed that the waivers would apply in this project. The City has routinely waived fees for FCHA projects in the past. Most of those waivers dealt with small building permit projects, but the waivers also applied to the. construction of the Via Lopez project in 1998 and 1999. The FCHA was developer of the low-income homeownership project, which included 22 single family detached homes sold to first-time homebuyers. These fee waivers totaled approximately $107, 476. In addition, two acquisition -rehabilitation projects were recently completed by FCHA utilizing LIHTC financing: Village on Elizabeth in 2008, and Village on Stanford in 2010. Both projects received total fee waivers of approximately $4, 000. In both cases, FCHA's subsidiaries are a .01 % partner and the equity investors have 99.9% interest in the partnership for the tax credit period of 15 years. At the end of that period, FCHA will be 100% owner. In 1995 and 1996, a 24-unit development on Impala Circle and a 44-unit development at 1403 West Swallow, .of which the FCHA was a minimal owner, were built with total estimated fee waivers of $164, 808. Several local projects, either partially or wholly composed ofaffordable units, have sought support from the FCHA. Not all such requests have been approved by the FCHA Board. The FCHA considers a number of criteria in reviewing such requests: financial feasibility, benefit to low- income households, access to support services and other criteria, before agreeing to participate. The funding of affordable housing projects requires strategic packaging of d variety of borrowed resources, application for local and federal funds, and, in most cases, the IRS Low Income Housing Tax Credit program. The LIHTCprogram requires that equity investors have a 99.9% ownership. It is really the only tool for affordable housing development for the community's lowest income families. Without it, market rents would be necessary to make the financing work and likely would no longer be considered as an affordable housing project. Affordable Housing Projects and Fees Development and building permit fees for affordable housingprojects are currently handled in two ways: 370 July 5, 2011 1. If the Housing Authority is involved, all fees and taxes, except for utilityfees, are waived as described above, pursuant to both State law and City Code. 2. For affordable housing projects that do not involve the Housing Authority, the following occurs: a. By City Code, development review fees are waived according to the percentage of the project that meets the criteria for and has been designated as affordable. If a project receives a 100% affordable housing designation, 100% of the development review fees are waived; if 10% of the housing units are designated affordable, 10% of the fees are waived. , b. By state and federal statutes, sales tax fees are waived for any tax-exempt entities. C. By City Code, plan check, building permit and certain utilityfees are collected at the time of building permit issuance. d. By City Code, all other fees are delayed until Certificate of Occupancy issuance, or December 1st of the year the building permit was issued, whichever f rst occurs. Development review fees cover services rendered. If the fees are waived, and the services are still provided, then the General Fund presumably backfills the gap of expenses incurred. Likewise, Capital Expansion Fees (parkland, fire, street oversizing, police, etc.) cover capital costs associated with new development. If the fees are waived and the capital improvements still provided, then other City, PFA and School District funds presumably backf 11 the gap. Utility connection fees are not waived. Over $1.5 million of City administered competitive funds, including CDBG and HOME, have already been expended on the Provincetowne project, including payment of water tap fees, electric capacityfees, PFA fees, and building permit fees. Building permits have been issued for all eleven buildings and construction is underway, with the first units expected to be occupied by the end of June 2011. Because of concerns about significant f nancial and policy impacts on the City, management staff and the City Attorney's Office have explored several facets of this issue. Staff also worked with the FCHA and CARE Housing on some proposed alternatives to a full waiver of fees for projects involving FCHA partnership. Alternatives discussed include deferring those fees rather than waiving them or limiting the waiver to situations where the FCHA is the majority owner of the project. As noted above, each of these alternatives proved to be unacceptable to one or more of the parties involved. As a result, the City Manager is recommending that the Council waive the fees for the CARE Housing project and then address possible changes in the policy of continuing to waive fees for these kinds of projects at a later time. The most significant issue for Council consideration is the determination of eligibility for fee waivers under current law. If Council determines that the Provincetowne project is not eligible for 371 July 5, 2011 a fee waiver because of the minority ownership position of the FCHA, and requires payment of the fees, that decision could create a potential default situation. One possible remedy would be that FCHA would step in, thereby creating full ownership, in a sense, and triggering a complex set of legal and financial actions. A more likely scenario would be that FCHA and/or CARE would assemble the funds to pay the fees. To date, the project is on budget and ahead ofschedule. The risk related to low income housing tax credit (LIHTC) leasing requirements remains but is minimal. The only real risk at this point would be the additional cost of over $500,000 in fees not waived. CARE Housing has the ability to refinance a property it currently owns and could takeout $509,896 inequity. CARE had planned to refinance a property and take out this equity in order to make planned capital improvements which would be deferred indefinitely if this money needs to go into Provincetowne. Attachment 4 is a memo from Julie Brewen, FCHA Director, that gives FCHA's perspective on the proposed fee waiver, as well as an explanation of how the FCHA determines, on a case -by -case basis, whether to enter into these kinds ofpartnerships. Other Pending Affordable Housing Projects The Legacy Senior Residences is expected to be under construction this fall, but this project will not be requesting a waiver offees. The cost of the fees has been built into the financing. Other projects are in the early planning stages, but construction is not anticipated until at least 2013. Other Communities Fort Collins is not the only communityfaced with this situation. Staff research shows that despite the state law, the waiver of fees is not consistently applied. Some cities waive fees as a matter of policy, and some waive on a case by case basis. Some do not waive fees. A summary of the research is included as Attachment 5. Future Policy and Legal Issues Several questions will be presented to Council at an upcoming work session, and may ultimately result in changes to the City's policies and ordinances regarding fee waivers. Does (or should) the waiver of fees for the Housing Authority properly extend to majority partners, or should it be limited to projects wholly owned, developed and operated by the Fort Collins Housing Authority, or projects with some specified ownership interest? Under what conditions should the City waive fees? If fees are waived, how are the financial impacts addressed? 372 July 5, 2011 FINANCLIL /ECONOMIC IMPACTS For the Provincetowne project (eleven multifamily buildings; a total of 85 low income rental units), the potential financial impact of a fee waiver to Cityfunds is $557,378. Approximately $4, 762 of the fee revenue lost is Utility development review fees. Building permit and plan checkfees total $42, 720. The remaining $509, 896 is comprised of Capital -Expansion fees (Fire, Police, General Government, Parkland, Street Oversizing, and School fees). These figures reflect recent changes in the capital expansion and utility development review fees. Some fees were collected at the inception of this project because of the unresolved issues, and approximately $17,177 will need to be refunded if the fees are waived. The following is a breakdown of the $509, 896 Capital Expansion Fees for the Provincetowne/CARE housing townhome buildings. Fire: $ 13,523 Police: $ 9,233 General Government: $ 16,920 Larimer County Roads: $ 15,725 Community Parkland: $118,830 Neighborhood Parkland: $106,590 City Street Oversizing: $148,665 School: $ 80,410 TOTAL CAPITAL EXPANSION FEES WAIVED: $509,896" Karen Cumbo, Director of Planning, Development, and Transportation Services, discussed the Housing Authority ownership of the project and its exemption from taxes and fees. She discussed the fees eligible to be waived. The Affordable Housing Board unanimously supported a motion to recommend the fee waivers, which are also supported by staff. Jim Martell, attorney representing the Housing Authority, discussed the possible ramifications of the fees not being waived. Eric Sutherland, 3520 Golden Currant, questioned the reduction in payment in lieu of land fees for Poudre School District. Bruce Lockhart, 2500 East Harmony, questioned the Housing Authority ownership percentage. Mel Hilgenburg, 172 North College, thanked the Housing Authority for providing housing in Fort Collins and urged Council to postpone a decision on the item. Dawn Davis, CARE Housing Board President, stated residents have begun moving into the project. She thanked Council and the City their assistance with the project. 373 July S, 2011 Councilmember Kottwitz asked about the logistics of waiving fees for other entities, such as Poudre School District and Larimer County. Cumbo replied those capital expansion fees would not be collected; however, the City is not required to backfill for other entities. Councilmember Kottwitz asked about the impact of postponing a vote. Cumbo replied the primary impact would be on CARE Housing and its relationship with its investor. Certificates of occupancy are not generally issued unless fees are paid; temporary certificates of occupancy have been issued already in this case. Mayor Weitkunat asked Mr. Martell to address the 0.01% Housing Authority ownership of the project. Mr. Martell presented an ownership structure chart. The investor receives the direct tax credit only if its ownership is nearly 100%. In this case, CARE Housing has a very small percentage of ownership as the General Partner and the Fort Collins Housing Authority has a small percentage of ownership as the Administrative General Partner. The investor receives a tax credit for 15 years and CARE Housing will receive $5 million in equity at the end of the 15 year period. Councilmember Troxell made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 071, 2011, on Second Reading. Mayor Pro Tern Ohlson agreed the outcome of this item is an important one for the community but stated he would not support the item given the 0.01 % Housing Authority ownership and the fact that Council is voting on the fee waiver after individuals are moving in to the project. Councilmembers Horak and Poppaw expressed support for the project. Mayor Weitkunat stated this project highlights some flaws in the affordable housing process. The vote on the motion was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Poppaw, Horak and Troxell. Nays: Ohlson. THE MOTION CARRIED. Items Relating to the Fort Collins Museum/Discovery Science Center Project, Ordinance Nos. 087 and 088, 2011, Adopted on First Reading, Ordinance No. 089, 2011, Defeated on First Reading The following is staffs memorandum for this item. "EXECUTIVE SUMMARY A. First Reading of Ordinance No. 087, 2011, Appropriating Prior Year Reserves in the General Fund for Transfer to the Capital Projects Fund for the Fort Collins Museum/Discovery Science Center Project. 374 July 5, 2011 B. First Reading of OrdinanceNo.088,2011,AppropriatingPriorYearReservesintheWater Fund for the Purpose of Providing a Loan to FCDM, Inc. for, the Fort Collins Museum/Discovery Science Center Project. C. First Reading of Ordinance No. 089, 2011 Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Exhibits of the Fort Collins Museum/Discovery Science Center Project and Appropriating Unanticipated Revenue in the Capital Projects Fund. $3, 875, 000 in funding for the new Fort Collins Museum/Discovery Science Center is needed now to complete the building. Completion.is scheduled for November 2011. The Downtown Development Authority (DDA) has committed $3 million for the building, but the funds are not currently available. The DDA is exploring funding options but will not have the funding in 2011. Adoption of Ordinance No. 087, 2011, will appropriate $3 million from General Fund reserves for the museum project to complete the building. The DDA plans to reimburse the Cityfor the $3 million through financing provided by the City or from other funds secured by the DDA. The Non -Profit Corporation (NPC) has committed $4,761,916 to the museum building, with $875, 000 of that amount in the form of pledges to be paid between 2012 and 2014. The NPC is working to obtain a private loan for the $875,000 but the financing will be costly and difficult to obtain. Adoption of Ordinance No. 088, 2011, will appropriate $875, 000 from reserves in the Water Fund to complete the building. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.5% and a maturity date of December 31, 2014. The loan will be evidenced by a loan and security agreement and corresponding promissory note. The NPC has raised $3.617 million for museum exhibits, with $1.2 million in the form ofpledges to be paid in future years (2011-2017). The new museum will open with a nice, but somewhat limited exhibit experience without a bridge loan for the $1.2 million in exhibit pledges. Some exhibits will be postponed, and other exhibits will be more static, without the depth of knowledge or interactive technology that will be possible once the future yearpledge money becomes available. Adoption of Ordinance No. 089, 2011, will appropriate $1.2 million from Water Fund reserves for museum exhibits. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.75% and a maturity date of December 31, 2017. The loan will be evidenced by a loan and security agreement and corresponding promissory note. BACKGROUND /DISCUSSION PROJECT FUNDING Through Council's support, the Fort Collins Museum and the Discovery Science Center (DSC) joined together to create an exceptional new museum experience and facility. In 2005, Council 375 July 5, 2011 included the new museum in the Building on Basics (BOB) capital program, which received strong voter support. BOB provided approximately $6.183 million for the project and required DSC to provide at least $3.6 million in matching funds. BOB also provides $200, 000 annually for seven years for operation and maintenance of the new facility. The DSC (which, along with the Museum Advisor Board, has transitioned into the Museum Non -Profit Corporation (NPC)) has raised approximately $8.879 million to date, far exceeding its original $3.6 million commitment. In addition to BOB funding, approximately $6.529 million has been provided from other public sources as follows: • City Natural Resources: (building $265,113 /exhibits $734,887) • Art in Public Places (Utility Project): • City land donation: • Department of Local Affairs: • Colorado Department of Public Health and Environment • Downtown Development Authority: • Estate Gift to the Fort Collins Museum Other Public Funding Building on Basics NPC $1, 000, 000 $ 435,000 $1; 730, 000 $ 200,000 $ 75,000 $3, 000, 000 $ 89,000 $6, 529, 000 $6,183, 000 $8, 879, 000 Together, public and private contributions to the project total: $21,591,000. Based on these funding commitments, the City sought and secured Council's approval to appropriate $15,109, 666 for the exhibit master plan, and design and construction of the new museum, as follows: $6,183, 750 from BOB $3,275,000 ($3 million DDA; $200,000 DOLA; $75,000 grant, Ordinance No.130, 2009) $4,561,916 from the NPC (Ordinance No. 117, 2010) $ 89, 000from Estate Gift (Ordinance No. 101, 2009) $1, 000, 000 from City Natural Areas Program Allocation of Appropriated Funds $13,218,105 Building $ 1,891,561 Exhibit Master Plan and Natural Areas Exhibits BUILDING FUNDS On January 27, 2010, after completion of the Request for Proposal process, the City entered into a design/build contract with Oz Architecture and Hensel Phelps for $11, 400, 000. On December 28, 2010, Change Order #1 was issued for $577, 347 which increased the building square footage from 39,905 to 46,928. Additionally, Change Order #2 was issued May 4, 2011, for $159, 824 for various 376 July 5, 2011 additional items incorporated into the contract. This brought the contract total to $12,137,171. Remaining appropriated building funds were used fdr soft costs (fees, environmental tests/services, project management etc). Building construction began in earnest on August 16, 2010 after completion of the development review process and resolution of a land title issue with railroad right-of-way that required a re- design of a storm water quality pond. Completion of the building is expected in November 2011. As of June 30, 2011, the City has paid $8, 754, 611 to the contractorfor workperformed. Additional payments of $3,382,560 are anticipated to complete the building as follows: July 31 $786, 000 August 31 $672, 560 September 30 $603,500 October 31 $493,500 November 30 $440, 000 December 31 $387, 000 All available funding for the building has been expended. Consequently, the design/build contract is short by $3,382,560. DDA FUNDING: The $3 million anticipated funding from the DDA is not currently available. The history of the DDA commitment of the funding is as follows: • April 2004: DDA Board approves $1 million for the museum project. • May 2009: DDA Board approves an additional $2 million for the project, with construction anticipated to begin in 2010. • June 2010: DDA and City Finance begin negotiations of terms with Great Western Bank for a 2010 bond issuance and determine capacity is not available to fund the museum commitment in the 2010 bond series. • July 2010: DDA inquires of City project staff as to when the $3 million is required, indicating DDA had to limit the bond principal amount in 2010 and needs to include the -museum commitment in its 2012 bond issuance, and suggests working together on some temporary solutions. Staff responds that DDA funds are needed in 2011, but does not take action to identify solutions. March 2011: DDA is notified by City that project has a funding deficit and needs DDA funds. DDA begins investigating options to fund'the $3 million commitment but confirms that funds will not be available in 2011. 377 July 5, 2011 NPC BUILDING FUNDS The NPC has committed $4, 761,916 to the -building, with $875,000 of that amount in the form of pledges that will be paid over the next few years. The $875, 000 is needed in 2011 to complete the building. The NPC has been working to secure abridge loan from private lenders for the $875, 000, but the tight credit market has made this very challenging and expensive. Annual interest payments in excess of $50, 000 are expected. The NPC is committed to bridging the $875, 000 in 2011 so the building can be completed. However, if the City provides the funding it would save the project considerable expense and assure timely completion (contingent on resolving the DDA funding problem). The outstanding building pledges are from very reliable organizations, as follows: The Griffin Foundation: $400,000 ($100,000 annually 2011-2014) Woodward: $250,000 in 2012 The Gates Family Foundation: $250, 000 in 2013 The Boettcher Foundation: $ 75, 000 in 2013 Staffhas investigated options for reducing the building expense. Unfortunately, the buildingproject is too far along to afford any significant savings. Staff has already made $300,000 worth of reductions to keep the project within the original budget. Additional reductions would require portions of the building to be unfinished. APPROPRL4TION FOR BUILDING Adoption of Ordinance No. 087, •2011, appropriates $3, 000, 000 from General Fund reserves for the museum project to complete the building. The DDA will reimburse the $3 million by obtaining private financing, or through financing provided by the City, as approved by Council. Adoption of Ordinance No. 088, 2011 appropriates $875,000 from Water Fund reserves to be loaned to the NPC for the museum project to complete the building. CONTRACT IMPLICATIONS If the Cityfails to make a payment, the City may be in default under the contract. NPC EXHIBIT FUNDS $2.975 million for exhibits has been raised by the NPC. These funds have been restricted by the donors for exhibits and cannot be used for the building. $1.2 million in exhibit donations will be paid in future years as follows: The Bohemian Foundation: $250, 000 in late 2011 The Schatz Foundation: $250,000 in 2012 Woodward: $200, 000 in 2014 Anonymous Donor: $500, 000 ($100, 000 annually 2013-2017) 378 July 5, 2011 The new museum will open with a nice, but somewhat limited exhibit experience absent a bridge loan for the future year exhibit pledges. For example, the early childhood area would not be in place; the live animal exhibit would include only the City's modest current collection; the bike exhibit would have to wait; and the Flood Theater exhibit would be postponed. Additionally, many exhibits will be more static, without the depth of information or interactive technology that will be possible once the future pledge funds become available. In contrast, three areas (Natural Areas, Science Experience, and Music and Sound) will be fully executed on opening day because they are funded by donations specifically designated for these exhibits. APPROPRIATION FOR EXHIBITS Adoption of Ordinance No. 089, 2011, appropriates $1.2 million from Water Fund reserves to be loaned to the NPC for Museum exhibits and appropriates the same amount in the Capital Projects Fund. THE DIGITAL DOME The Digital Dome Theater is the capstone element of the Museum of Discovery. It provides a 360 degree immersive experience for the exploration of astronomy, music, earth and climate science, art, cultural history, presentations, and events. A $2 million campaign is underway to fund the dome and $500, 000 has been raised with $350, 000 in the form of future year pledges. The NPC is working to secure a private bridge loan for the $350,000 so the infrastructure for the dome can be completed by the on -site building contractor. Completing this work in the future would be much more ($125, 000 to $200, 000) expensive. No Council action is being requested regarding the Digital Dome. FINANCIAL /ECONOMIC IMPACTS Adoption of Ordinance No. 087, 2011 appropriates $3,000,000 in the General Fund to cover construction of the Museum building. The DDA's pledge has already been appropriated in the Capital Projects Fund, however the project is underway and they are unable to make payment at this time. To fund its pledge, the DDA plans to seek external financing. In that scenario the amount of available reserves in the General Fund at the end of 2012 are forecasted to exceed the policy minimum by $7,500,000. If however the DDA instead asks the City for a loan, and the loan is granted, available reserves above the policy minimum will be $4,500,000. Adoption of Ordinance No. 088, 2011 authorizes $875, 000 in the Water Fund to be loaned to the NPC. The NPC building commitments have already been appropriated in the project, however the project is underway and they are unable to make payment at this time. The NPC has building pledges equal to their commitment but the pledges will come in installments through 2014. The Water Fund currently has reserves that exceed their policy minimums allowing them to make this 379 July 5, 2011 loan. The proposed terms are 3.5%annual interest and $875, 000 in principal to be paid according the loan agreement. Adoption of Ordinance No. 089, 2011 authorizes $1, 200, 000 in the Water Fund to be loaned to the NPC, and appropriates the same amount in the Capital Projects Fund for exhibits in the Museum. The NPC has received exhibit pledges of $1,200,000 but the pledges will come in installments through 2017. The Water Fund currently has reserves that exceed their policy minimums allowing them to make this loan. The proposed terms are 3. 75% annual interest and $1,200, 000 in principal to be paid according the loan agreement. Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, assuming that staff -projected rate increases are implemented. The Ordinance provides that it is the Council's intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the loan to the Water Fund to meet that need. " City Manager Atteberry stated staff could have provided additional communication regarding this project which has differed from most other City projects as it has a significant private sector element. The communication -issue has been caused by timing and various sources of money. Mike Freeman, Chief Financial Officer, discussed the financial history of the Fort Collins Museum and Discovery Science Center projects. Cash flow issues have resulted from the inability of the Downtown Development Authority to make its contribution at this time and the gradual inflow of funds for exhibits and partial building construction. The Museum Nonprofit Corporation (NPC), formerly the Discovery Science Center, committed $4.56 million of its funding for the museum building; $875,000 of that is in pledges to be paid between 2012 and 2014. Ordinance No. 088, 2011, is an appropriation from the Water Fund which is anticipated to cover the $875,000. Ordinance No. 087, 2011, is a $3 million appropriation from General Fund Reserves. Should these appropriations not be approved, a stop work order will need to be considered. Ordinance No. 089, 2011, is a recommended appropriation from the Water Fund for $1.2 million which would allow the NPC to ensure the exhibit space is complete when the building opens.. Jill Stillwell, Cultural Services Director, provided an overview of the Operating Agreement between the City and the NPC. The NPC and the City remain separate entities though the City has been allowed to appoint 3 members to the NPC Board. Each entity will be required to approve the Operating Agreement on an annual basis. Bruce Lockhart, 2500 East Harmony, questioned the inability of the Downtown Development Authority to pay its debts and questioned the use of the Water Fund for these appropriations. Martina Wilkinson, NPC Executive Committee member, discussed community support for the project and supported the Ordinances. :M July 5, 2011 Eric Sutherland, 3520 Golden Currant, asked how much advance notice Council received regarding financing of the RM12 building. He asked for additional details regarding the status of the Water Fund. Dan Gessler, 2000 South College, president of Alden, discussed the decision of his engineering company to open its western branch in Fort Collins, which was influenced by the cultural amenities found in the City. Steve Vandermeer, 1212 Westview, NPC Board President, expressed appreciation for the Board's partnership with the City and supported the Ordinances. (**Secretary's note: The Council took a brief recess at this_point in the meeting.) Mayor Pro Tern Ohlson suggested the work session scheduled to follow this meeting be postponed. Councilmember Horak made a motion, seconded by Councilmember Troxell, to reschedule the work session to July 12, 2011. Yeas: Weitkunat, Manvel, Poppaw, Ohlson, Horak and Troxell. Nays: none. (**Secretary's note: Councilmember Kottwitz was not present for the previous vote.) THE MOTION CARRIED. Councilmember Poppaw asked about the repercussions of loaning the money. Freeman replied the issuance of this loan would not have any impact on water rates and is treated as an investment. Should those funds be needed for other uses in the future, Council could replace them with General Fund Reserves. These loans are not considered to be, long-term, but rather temporary fixes for temporary cash flow issues. Councilmember Horak asked why the larger $3 million appropriation was coming from the General Fund Reserves. Freeman replied staff is attempting to balance where the dollars originate. Councilmember Horak suggested the use of capital projects funds. Councilmember Horak asked why an interest -bearing loan to the DDA was not considered. Freeman replied it was considered: Matt Robenault, Downtown Development Authority Director, replied that type of loan was not an option for the DDA because it bundles multiple projects together when it issues debt. Councilmember Horak suggested taxpayers are losing an opportunity to earn interest with the proposed scenario. Robenault replied the DDA incurred additional costs when the City quit buying its debt, as it had done for the past 9 years. Councilmember Horak asked why the City stopped buying the DDA's debt. Robenault replied using the interest rates the City had offered in previous debt purchases would have provided the DDA with 381 July S, 2011 $12.5 million in principal. Because the DDA had to find another debt purchaser, the incurred financing costs prevented it from including the museum in the 2010 issuance. Councilmember Horak suggested the City could possibly work out a loan with the contractor. Ken Mannon, Operations Services Director, replied the option was discussed and the contractor indicated that was not possible. Councilmember Poppaw asked about implications to the City's bond rating should it miss a payment to the contractor and become in default of the contract. Freeman replied there may not be an impact with one incident; however, further research would need to be carved out. Councilmember Horak asked how the City obligated money it did not have. Freeman replied the City intended to receive income from the funding partners. Obligations are occasionally made when money is not yet in hand. Councilmember Kottwitz asked where the DDA receives its funding and what role the City plays in DDA funding. Freeman replied the City does not play a role in funding the DDA; it receives funding through tax increment financing and an on -going mill levy. Robenault replied the DDA receives a 5 mill property tax levy assessed within the district and receives tax increment financing from building improvements. Councilmember Kottwitz asked whether the City would be in default of the contract if these loans are not made and who would be liable for the $600,000 payment should a work stoppage occur. City Attorney Roy replied failure to make a payment per a contract is generally considered a material breach of the contract. Mannon replied the City would be liable for the $600,000. Councilmember Kottwitz asked why the Water Fund is being used for part of the loan. Freeman replied the $3 million is an appropriation, not a loan, from the General Fund Reserves. In the past, the General Fund has been the only source for inter -fund loans or loans for projects such as this. Council now has the ability to elect to take loans from other funds and the Water Fund currently has the most resources. Mayor Pro Tem Ohlson asked why 100% of the projected revenues from retail sales at the museum are slated to go to the private NPC, given 70% of the project will be funded by public dollars. Stillwell replied the NPC solely survives off those types of revenues and donations. Mayor Pro Tem Ohlson asked how the City benefitted from negotiations. Stillwell replied having a private partner allows the City to do significant fundraising and grant writing it is unable to do as a municipal organization. Mayor Pro Tem Ohlson asked about the operations and maintenance costs for the building. Stillwell replied the operating plan has not yet been completed but will need to be in place and approved by both the NPC and Council by the time the facility opens in 2012. The operating plan is slated to have a 4-year projection. KYJ July s, 2011 City Attorney Roy clarified there is one formal agreement which has been executed between the parties. That agreement calls for both parties to approve an operating plan on a regular basis. Council's approval and the NPC's approval of that plan will likely need to be evidenced by resolution. Mayor Pro Tem Ohlson expressed concern that there is no definite plan for operations and maintenance costs. City Manager Atteberry replied staff would respond to those concerns. Mayor Pro Tem Ohlson asked if staff is considering placing the NPC. employees on the City's health insurance program. City Manager Atteberry replied there are other entities indirectly tied to the City whose employees participate in the health insurance program. higrid Decker, Senior Assistant City Attorney, replied the original concept was to allow the NPC employees to have equivalent benefits through the City's program, but at the cost of the NPC. However, it has since been determined that is not feasible. Mayor Pro Tem Ohlson asked about donor acknowledgement policies. City Manager Atteberry replied those policies were approved by the City Manager, per the operating agreement, and a copy would be forwarded to Council. Mayor Pro Tem Ohlson asked about the City's $350,000 annual contribution versus the NPC's $100,000 amount. Stillwell replied one of the items which would cause the relationship between the City and the NPC to dissolve would be if the City opted out of funding the facility. The $350,000 is approximately half of the current annual City contribution to the facility; should the City's contribution go below that mark, it would be a trigger point for having a conversation about the partnership continuing. Mayor Pro Tem Ohlson asked why only one of the City's three Board seats has been filled. Stillwell replied this is an opportunity for the City to expand is representation on the Board. Councilmember Manvel stated it was an oversight to have not had complete representation on the Board. City Manager Atteberry agreed but suggested moving forward with three representatives. Marty Heffernan was the City's lead negotiator on the contract and negotiated for over two years. Councilmember Horak asked if there will be a membership to the Museum that will ultimately appoint Boardmembers. Mr. Vandermeer, President of the NPC, replied the Board currently appoints the Boardmembers, with the exception of the City representatives. Councilmember Horak encouraged changing the system to allow the members to appoint Boardmembers. Councilmember Horak asked if the NPC would be open to the City having more than three representatives. Mr. Vandermeer replied the NPC welcomes the full Board representation and would be open to discussion regarding additional membership. Councilmember Horak proposed approving the loan from the Water Fund and changing its amount from $875,000 to $2,075,000, allowing for work to continue for three more months, during which time further discussion could occur regarding additional funding. 383 July s, 2011 Councilmember Horak made a motion, seconded by Mayor Pro Tern Ohlson, to adopt Ordinance No. 088, 2011 as amended, on First Reading. City Attorney Roy asked for clarification regarding the motion which would not appropriate the entire amount among the three Ordinances but would rather increase the amount in Ordinance No. 088 from $875,000 to $2,075,000. He requested latitude to make changes to the Ordinance to achieve the appropriate intent. City Manager Atteberry noted, should the motion be approved as stated, exhibit fabrication funding would be affected; thereby affecting the museum opening. Stillwell stated it is possible for exhibit fabrication to begin with money that has already been contributed for that purpose. Councilmember Poppaw asked if these changes would negatively affect the bottom line. Stillwell replied contracting the entire fabrication at once would provide certain efficiencies as opposed to phasing; however, she did not have a specific dollar savings amount. City Attorney Roy asked if appropriating some of the money for exhibits would be an acceptable part of the motion. Mayor Weitkunat clarified the motion on the table noting the loan would come from the Water Fund in the amount of $2,075,000, for the purpose of paying three months of construction costs. City Manager Atteberry stated he would like staff to have the flexibility to possibly add exhibit fabrication costs as part of the Ordinance on Second Reading. Putting exhibit fabrication on hold for three months will delay the museum opening, thereby affecting revenues. Councilmember Manvel supported the concept of the motion but expressed concern regarding adding the two unrelated sums together. Councilmember Kottwitz stated she would not support the motion, though she appreciated the attempt to compromise. She asked for a detailed accounting of the Water Fund withthis loan. Mayor Pro Tern Ohlson stated he would support the motion given the compromise attempts. Councilmember Horak and Mayor Pro Tern Ohlson amended the motion to adopt Ordinance No. 088, 2011, as written. Mayor Weitkunat stated this project has a great deal of community support and it is unfortunate the funding timing issue has become a focus. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: Kottwitz. THE MOTION CARRIED. 384 July 5, 2011 Councilmember Manvel made a motion, seconded by Mayor Weitkunat, to adopt Ordinance No. 087, 2011, as amended, on First Reading. r Councilmember Manvel made a motion, seconded by Councilmember Horak, to amend Ordinance No. 087, 2011, to change the appropriation amount from $3 million to $1.5 million. Councilmember Troxell asked what the impact such a change would have on the project. City Manager Atteberry replied the previously adopted Ordinance No. 088, 2011, would fund July construction costs. Funding 3 months of construction will cost approximately $2 million, not including exhibit fabrication. Councilmember Manvel clarified partial amounts of each loan will be repaid by the DDA. Councilmember Horak clarified changing the amount to $1.5 million will fund the next three months of construction while still allowing the investigation of other funding sources or replacement of this General Fund money. Councilmember Kottwitz asked about the duration of the loan. City Manager Atteberry replied, once the DDA is able to sell its bonds, the City will receive the money quickly thereafter. Additionally, significant pledges are due between 2012 and 2017. The vote on the motion to amend was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Poppaw, Horak and Troxell. Nays: Ohlson. THE MOTION CARRIED. City Manager Atteberry asked about Council's intent regarding exhibit construction. Stillwell replied there are designated immediately available funds for construction of the three exhibition sections. The vote on the motion to adopt Ordinance No. 087, 2011, as amended, was as follows: Yeas: Weitkunat, Manvel, Poppaw, Horak and Troxell. Nays: Kottwitz and Ohlson. THE MOTION CARRIED. Councilmember Troxell made a motion, seconded by Mayor Weitkunat, to adopt Ordinance No. 089, 2011, on First Reading. Mayor Pro Tern Ohlson stated he would not support the motion as funds are already present to begin exhibit construction. Stillwell confirmed the City is not yet under contract for exhibit fabrication and noted adoption of Ordinance No. 089, 2011, would fund all eleven zones of exhibits. Councilmember Horak stated he would not support the motion. 385 July s, 2011 Councilmember Troxell asked when the exhibit pledges to pay for the loan in Ordinance No. 089, 2011, would be due. Stillwell replied the exhibit pledges would come in beginning in 2011 through December, 2017. The loan would be repaid with a 3.75% interest rate. The vote on the motion was as follows: Yeas: Troxell. Nays: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw and Horak. THE MOTION FAILED. Extension of the Meeting Councilmember Manvel made a motion, seconded by Councilmember Troxell, to extend the meeting past 10:30 p.m. Yeas: Weitkunat, Manvel, Ohlson, Horak and Troxell. Nays: Kottwitz and Poppaw. THE MOTION CARRIED. ("Secretary's note: The Council took a brief recess at this point in the meeting.) Resolution 2011-057 Establishing a Process for Enhancing Communication Between the City Council and the Council -Appointed Platte River Power Authority Board Member, Adopted The following is staff s memorandum for this item. "EXECUTIVE SUMMARY Each of the four member cities that established Platte River Power Authority ("PRPA') has two representatives serving on the PRPA Board of Directors. One is the mayor, and the other is appointed by City Council. In May 2011, Council requested that a process be established to provide direction to the Council -appointed member ofPRPA. This resolution establishes the process for the Council -appointed Board member to communicate with, and receive comments from, City Councilmembers. BACKGROUND I DISCUSSION PRPA was established by the cities of Fort Collins, Loveland, Longmont and Estes Park to be their wholesale powerprovider. The contract establishing PRPA requires each municipality to have two members on the board of directors ofPRPA. One is the mayor, and the other is appointed by City Council. Historically, the Council -appointed Board member has been the Director of Utilities. The Director of Utilities reports to and receives direction from the City Manager. As the policy making body for the City, Councilmembers desire to provide comments regardingpositions the non -mayoral PRPA Board member should take on particular PRPA agenda items. 386 July S, 2011 This resolution establishes a process, consistent with the City Charter, to have the Council - appointed Board member communicate with City Councilmembers and for Councilmembers to provide comments regarding particular PRPA agenda items. " Brian Janonis, Utilities Executive Director, stated this Resolution provides a process for the Council - appointed representative to get feedback and input from Council and to provide information to Council about issues coming before the PRPA Board. Eric Sutherland, 3520 Golden Currant, stated Council is the only connection between citizens and the PRPA Board. He opposed the Resolution. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Resolution 2011-057, as amended. Councilmember Poppaw supported the Resolution. City Manager Atteberry noted this Resolution clarifies Council's expectations of the relationship between Council and the appointed Boardmember. The vote on the motion was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Ordinance No. 074, 2011, Appropriating Funds From the City's General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson Inc Project at 1330 Blue Spruce, Adopted on Second Reading The following is staff s memorandum for this item. "EXECUTIVE SUMMARY This Ordinance, unanimously adopted on FirstReading on June 7, 2011, authorizes a loan from the City to the Urban Renewal Authority (URA) to reimburse Kaufman and Robinson, Incfor thepublic improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City's Interfund Borrowing program that was formally added to the City's investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investmentportfolio. 387 July 5, 2011 Bruce Lockhart, 2500 East Harmony, asked why the City is loaning money to the Urban Renewal Authority. Councilmember Horak made a motion, seconded by Councilmember Troxell, to adopt Ordinance No. 075, 2011, on Second Reading. Mayor Pro Tem Ohlson discussed an article which stated California has eliminated urban renewal authorities and tax increment financing. The vote on the motion was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project, Adopted on Second Reading The following is staff s memorandum for this item. "EXECUTIVE SUMMARY This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan in the amount of $3 million from the City to the Urban Renewal Authority (URA) to fulfill the remaining reimbursement obligation for the North. College Marketplace granted by the URA Board in September 2008. The first appropriation for $S million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins' Water Fund Reserves to the URA will be $3 million and reimbursed to the project for the On -Site public improvements. Staff originally intended to request the funds from the City's General Fund reserves however, after discussions with the Finance department, Utilities and the Attorney's office, the request changed to the Utilities Water Fund reserves to ensure the URA was not overburdening the General Fund reserves. Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, assuming that staff -projected rate increases are implemented. The Ordinance provides that it is the Council 's intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the loan to the Water Fund to meet that need It is anticipated that the URA will issue bonds within the next few years, and in that event, the loan from the Water Fund would be repaid at that time. " July 5, 2011 Bruce Lockhart, 2500 East Harmony, opposed making a loan from the Water Fund and asked about the repercussions for not approving the loan. Councilmember Troxell made a motion, seconded by Councilmember Manvel, to adopt Ordinance No. 075, 2011, on Second Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Light and Power Appropriations into the Light and Power Utility Relocation Capital Project Adopted on First Reading The following is staff s memorandum for this item. "EXECUTIVE SUMMARY This Ordinance appropriates capital project funding for the Utilities to relocate existing electric, water and wastewater facilities to accommodate the Mason Corridor Bus Rapid Transit (BRT) Project. Light and Power will also supply power to the bus stations along the corridor. The Utilities are being viewed by the MAX/BRT Project as independent contractors and will be reimbursed by the MAX/BRT Project funds for the relocation expenses upon completion. The MAX/BRT Project will also pay for the cost of electric power supply to the bus stations. The Ordinance provides new capital appropriations in the Light Power Fund ($620, 000), Water Fund ($625, 000) and Wastewater Fund ($1,150, 000) for the relocation work. Following completion of the construction, the Utilities will invoice the MAX/BRT Project based on actual costs and will receive the unanticipated revenue being appropriated by the Ordinance. In addition to electric duct bank relocation, Light and Power will use this opportunity to upgrade the capacity of the duct bank. These system upgrade costs have been budgeted in Light and Power's existing 2011 lapsing appropriation. The Ordinance transfers $400, 000 of the existing Light and Power lapsing budget into the new BRT electric relocation/upgrade capital project. The costs of the upgrade will not be reimbursed by the MAX/BRT Corridor Project. BACKGROUND /DISCUSSION This Ordinance appropriates the following funds related to utilities, work to accommodate the Mason Corridor Bus Rapid Transit Project. The amounts shown are construction estimates. The MAX/BRT Corridor Project will pay the Utilities based on actual design and construction costs. Relocation work will not proceed until authorization is issued by the MAX/BRT project manager. July 5, 2011 $400,000 Light and Power Fund — New Capital Project Appropriation This portion of the appropriation is fifty percent of the $800, 000 cost to relocate and upgrade existing electric facilities for the M, X/BRT Project Corridor Project. This phase will involve the relocation of the duct bank between Drake and Prospect. The duct bank is being relocated due to logistical conflicts with the Mason Street Corridor guide way. Construction on this phase is anticipated to be completed by year-end. This $400,000 expense will be reimbursed by the MAX/BRT Project funding. $400,000 Light and Power Fund — Transfer of Existing 2011 Appropriation The Light and Power Fund will bear fifty percent of the cost for the $800,000 upgrade and relocation because this project will enlarge capacity for the electric system as well as move the existing system to accommodate the MAX/BRT Project. This portion of the appropriation is to be transferred from the existing 2011 Light and Power appropriation into the new Light and Power capital project. There will be no reimbursement for this half of the expense. $220,000 Light and Power Fund -New Capital Project Appropriation This is the estimated cost to provide electric service to the bus stations along the MAX/BRT Project Corridor. This electric construction is planned for 2012 and 2013. One hundred percent of the station power costs will be reimbursed by MAXBRT Project. $625,000 Water Fund - New Capital Project Appropriation $1,150,000 Wastewater Fund -New Capital Project Appropriation With the construction of the MAXBRTProject beginning in 2011, the Utility is faced with as many as 18 separate locations where the MAX/BRT crosses or parallels existing water and sewer infrastructure. This will impact the integrity, serviceability, longevity and safety of the operation of both the Utility pipelines and the MAX/BRT. Because ofpotential negative impacts to the Utility infrastructure (both immediately and in the future) or future impacts to the MAXBRT, this is the opportunity to improve, modify and/or protect the water and sewer lines before the BRT improvements are built. The project has a short lead time with design scheduled to be done by early fall and construction completed by early in 2012. One hundred percent of the Water and Wastewater Utility's expenses will be reimbursed by MAX/BRT Project funding. Bruce Lockhart, 2500 East Harmony, expressed concern citizens were not able to vote on the Mason Street Corridor project expenditures. He encouraged placement of the item on the November ballot. Councilmember Troxell asked if the high voltage lines at the Drake substation are scheduled to be undergrounded. Steve Catanach, Light and Power Operations Manager, replied in the negative. Councilmember Troxell suggested this would be an appropriate opportunity to put together a proposal for undergrounding there and for all other high voltage transmission lines in the City. Catanach replied that could be explored and a report prepared. ca July 5, 2011 Councilmember Troxell made a motion, seconded by Councilmember Manvel, to adopt Ordinance No. 077, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26, and to Standards for Interconnection of Electric Generation Facilities, Adopted on First Reading The following is staffs memorandum for this item. "EXECUTIVE SUMMARY A. First Reading of Ordinance No. 079, 2011, Making Certain Amendments to Chapter 26 of the City Code Pertaining to the Provision of Net Metering Service and Certain Definitions Related Thereto. B. First Reading of Ordinance No. 080, 2011, Amending Various Provisions of the City Code and the Land Use Code Pertaining to the Definition of General Manager. C. First Reading of OrdinanceNo.081,2611,MakingCertainAmendmentstoInterconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System The Fort Collins Utilities Light and Power Department is proposing minor revisions to the definitions section of Article I and to the Electric Article of Chapter 26 of the City Code and the Land Use Code. These revisions include updating the definition of General Manager, clarification regarding the provision of net metering service and clarification regarding authority to execute interconnection or parallel generation agreements on behalf of the City. Light and Power is also recommending adding clarifying language to the City's indemnification and insurance requirements contained in the City's Interconnection Standards. These standards govern operational and other requirements for interconnection generating facilities to the City's electric distribution system. BACKGROUND /DISCUSSION The Light. and Power Department is proposing the following revisions to the Electric Article of the City Code and revisions to the Land Use Code. These revisions are primarily definitional in nature. Title revision and appointment: General Manager of Utility Services or General Manager shall mean Utilities Executive Director or appointed designee of such Executive Director. Sec 26-391. "Definitions". Clarifying that "Net metering service" is available exclusively for a qualifying facility "using a qualifying renewable technology ". Sections 26-391, 465 through 468. i0l July 5, 2011 Also included is an amendment specifically authorizing the Utilities General Manager or the Manager's appointed designee to sign interconnection agreements or parallel generation agreements. Light and Power is also recommending adding clarifying language to the City's indemnification and insurance requirements contained in the City's Interconnection Standards. As currently written, the indemnification and insurance requirements in the Interconnection Standards allow for no flexibility where a governmental entity cannot by law indemnify the City and may elect to self -insure in accordance with Colorado law. By adding the following language, "except when the Operator is a governmental entity that self -insures in accordance with Colorado law", the City's Interconnection Standards will now allow for that flexibility. " . Eric Sutherland, 3520 Golden Currant, supported the renewable energy aspects of the Ordinances. Councilmember Troxell stated he would like the City to have a more comprehensive perspective with regard to the marketplace and would like to see real-time information going to customers as part of the Smart Meter program. He asked about the feed -in tariff, time of use, and other demand - side management issues. Councilmember Manvel made a motion, seconded by Councilmember Troxell, to adopt Ordinance No. 079, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 080, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 081, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Resolution 2011-054 Naming Three Alleys Within the Block Bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street, No Action Taken The following is staff s memorandum for this item. 392 July 5, 2011 "EXECUTIVE SUMMARY The Downtown Development Authority (DDA) is preparing a capital improvement project to enhance three alleys in the block bounded by South College, West Laurel, South Mason and West Olive. In conjunction with this project, the City of Fort Collins is preparing to name these three alleys. The three proposed names are "John Coltrane Alley, " "Ella Fitzgerald Alley"and "Billie Holiday Alley. " The selection of these three names is based on a public outreach process that resulted in a winning theme of eclectic music and art. If approved, the alley naming will simplify way -finding for pedestrians,, bicyclists, drivers, delivery personnel and emergency responders. J BACKGROUND /DISCUSSION The Downtown Development Authority is continuing its alley improvement program for the 2011 construction season. Similar previous efforts resulted in improved alleys that are attractive, brighter, safer and more heavily traveled. Providing names for these alleys helps the public navigate the City's urban area and contributes to an overall sense ofdirection. Naming these alleys is consistent withpastpractice: Trimble Court, Tenney -Court, Old Firehouse Alley, and Montezuma Fuller Alley. Review of the request to name these three alleys has followed the Current Planning Department's procedures for street naming. Since the alleys fall below the classification of arterial and collector streets, the names do not need to be derived from the approved list of names established by City Code Section 24-91. All directly affected property owners were notified, as well as surrounding property owners. The Poudre Fire Authority and all affected utilities, City departments, and various mapping agencies were notified. All respondents indicated that there are no problems or concerns with the proposed names. The public outreach and name selection process included meetings and mailings with surrounding property owners beginning with a public meeting on March 30, 2011. Participants were first asked to prioritize a theme. Four themes were offered. These themes and their final rank order in the voting, were eclectic music and art, trains, Colorado State University, and history. The process is explained more completely in the Public Outreach section below. FINANCJAL /ECONOMIC IMPACTS There are no negative financial impacts to City of Fort Collins as the cost of installing new street signs will be borne by DDA 's capital project fund. The overall economic health of the City will be enhanced with improved alleys that will benefit the safety; and mobility of business owners, employees, customers and the general public. Maintenance of the alleys will be similar to that for the other improved downtown alleys, and funded through the existing contract between the DDA and the City of Fort Collins Parks Department. These improvements may provide a catalyst for private property owners to re -invest and upgrade their properties. 393 July S, 2011 PUBLIC OUTREACH The public outreach and name selection process consisted of a kick-offpublic meeting on March 30, 2011 which established four themes as a method for narrowing down the options. A variety of names were suggested for each theme. These themes, and their final rank order in the voting were: eclectic music and art, trains, Colorado State University, and history. This was followed by numerous contacts with the surrounding property owners and included a mail -in survey to SS stakeholders. Survey results were eclectic music and art - 7 votes, trains - 4 votes, Colorado State University - 4 votes, and history - lvote, and resulted in the winning theme and three names. Finally, a mailing to affected property and business owners within approximately 800 feet of the subject alleys was sent to inform them about the proposed Resolution on the July S, 2011 City Council agenda. " Councilmember Troxell expressed concern there is no local context for the proposed alley names. He asked that the item be reconsidered with more public input and thoughtful deliberation. Ted Shepard, Chief Planner, noted living people are not considered when naming collectors and arterials within the City. Derf Green, Downtown Development Authority, stated public input was solicited throughout the area resulting in only very limited participation. The theme for this alley is eclectic art and music. CouncilmemberTroxell encouraged broadening the Colorado State University and train theme ideas. Amanda Miller, Project Manager, stated three names of recently deceased CSU faculty were presented to participants at the original meeting and participants did not feel it was appropriate to use those names. Mayor Pro Tern Ohlson stated Council should have been consulted earlier in the process. He asked how the eclectic music theme was derived. Shepard replied the idea is to foster a hip urban scene and create a catalyst for further redevelopment in this subsection of the downtown area. Mayor Weitkunat stated the names may not foster the proposed direction. Councilmember Poppaw appreciated the direction but agreed with Mayor Weitkunat. She asked about the timing of the issue. Mr. Green replied the timing is driven, in part, by the necessity to place the alley name in a concrete band on either end of the alley. Mayor Pro Tern Ohlson suggested the public outreach for naming should have extended beyond just the bordering property owners. City Manager Atteberry suggested staff return in two weeks with new options. WE] 1 July 5, 2011 Resolution 2011-055 Authorizing the Mayor to Execute an Amendment to the Intergovernmental Agreement with the Fort Collins Urban Renewal Authority, Adopted The following is staff s memorandum for this item. "EXECUTIVE SUMMARY At the June 7, 2011 meeting, Council requested the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that, when the City advances funds to the URA in support of the URA's activities, a loan agreement and promissory note accompany the advance offunds. BAC%GROUND /DISCUSSION Council would like to formalize the process for loaning funds to the URA based on approved projects and eligible costs associated with the development. The URA continues to need funding from the City for projects until such time that the URA can obtain private financing with proven revenue streams sufficient to pay higher interest rates on its loans. The City wants to ensure the funding is appropriately dedicated to a project with a loan agreement and promissory note in place. " Eric Sutherland, 3520 Golden Currant, expressed concern the URA does not have a business plan. i Councilmember Manvel made a motion, seconded by Councilmember Troxell, to adopt Resolution 2011-055. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Other Business Councilmember Horak made a motion, seconded by Mayor Pro Tern Ohlson, to waive the attorney - client privilege as it applies to the report that Council has received from special counsel legal Gerald E. Dahl concerning the City's relationship with Character Fort Collins, which report is dated June 10, 2011, so that the report can be made available to the public. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 395 Adjournment The meeting adjourned at 11:50 p.m. yor ATTEST: OF FORT `may ,,.....,• •co s�� .ch z City Clerk . 396 July 5, 2011