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HomeMy WebLinkAboutMINUTES-10/18/2011-RegularOctober 18, 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, October 18, 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, Daggett. Citizen Participation Debra Goodson, 912 Wood Street, discussed the necessary moving of the mobile homes at the Bender Mobile Home Park. She requested financial assistance from the City and developer for relocation costs. Wiley McCallum, 912 Wood Street, opposed the effect of the purchase of the Bender Mobile Home Park by Sidehill Investments on its residents. Arnie Combs, 912 Wood Street, requested support for the Bender Mobile Home Park residents. Michael Chalona, Parks and Recreation Board Chairperson, requested Council support of Item No. 12, First Reading of Ordinance No.133, 2011, Amending Section 2-338 of the City Code Pertaining to the Duties and Functions of the Parks and Recreation Board. Rob Cagan, Parks and Recreation Board Vice -Chairperson, thanked staff and requested Council support of Item No. 12, First Reading of Ordinance No. 133, 2011, Amending Section 2-338 of the City Code Pertaining to the Duties and Functions of the Parks and Recreation Board. Dawn Thies, Parks and Recreation Board, thanked staff and requested Council support of Item No. 12. Sarah Burnett, 714 Gilgalad Way, opposed restrictions on public comment regarding potential quasi- judicial matters. Joann Ginal, 316 East Magnolia, Human Relations Commission, thanked Council for its contributions to the community and announced the Make It Stop anti -bullying summit on Wednesday, November 9th at the Atzlan Center. October 18, 2011 Vivian Armendariz, 820 Merganser Drive, expressed concern about the use of power wheel chairs in bicycle lanes. Citizen Participation Follow-up Councilmember Poppaw thanked the Human Resources Commission for announcing the anti - bullying event. She noted Council will be participating in annual reviews on November 9 and will be unable to attend. Councilmember Horak requested an update on the Bender Mobile Home Park issue. He supported Council consideration of allotting a budget line item to housing relocation costs. He discussed the reintroduction of the sidewalk committee to address safety issues. He suggested changes be made to development review proposal notification signs and stated he may propose funding for citizen assistance regarding development review. Councilmember Kottwitz requested an update on the Bender Mobile Home Park. Karen Cumbo, Director of Planning, Development, and Transportation Services, replied the City's Neighborhood Services staff has continued to work with residents and Neighbor -to -Neighbor:" A community meeting will be held tomorrow. The County has offered to help with coordination; however, funding is yet undetermined. The developer's role is also yet undefined. Councilmember Horak noted the property cannot be annexed until that action is requested by the landowner. CONSENT CALENDAR 6. Consideration and Approval of the Minutes of the September 20, 2011 Regular Meeting. Second Reading of Ordinance No. 128, 2011, Appropriating Unanticipated Revenue in the Capital Projects Fund for the Veterans Plaza Project at Spring Canyon Community Park. The Veterans Plaza at Spring Canyon Community Park creates a public venue,bringing community members together to recognize and. commemorate the sacrifices and dedication of service members who have served our country. The plaza is located on approximately three acres of land near the main entrance of the Park at Horsetooth Road. This Ordinance, unanimously adopted on First Reading on October 4, 2011, will appropriate funding in the amount of $60,000 for the final phase of the Veterans Plaza project 8. Second Reading of Ordinance No. 129, 2011, Authorizing the' Acquisition by Eminent Domain Proceedings of Certain Lands Necessary to Construct Public Improvements Related to the Mason Corridor Bus Rapid Transit Project (Phase V). Right-of-way acquisition continues for the Mason Express Bus Rapid Transit (BRT) Project. This Ordinance, unanimously adopted on First Reading on October 4, 2011, pertains to the final acquisition phase of the BRT Project and is comprised of 15 separate properties ready 84 a October 18, 2011 for the acquisition stage. The City Council authorization specified by this Ordinance begins the first step of the City's acquisition process for the property interests within this phase. Require the City to Pay the Postage Due for Ballots Returned by Mail. This Ordinance, unanimously adopted on First Reading on October 4, 2011, amends the City Code to require that ballots in a City mail ballot election be mailed to inactive registered electors who voted in the last presidential election in addition to all active registered electors. In addition, the Code will be amended to require that the City pay postage on all voted ballots returned by mail. Both amendments are anticipated to increase voter participation. This Ordinance has been amended on Second Reading to add language clarifying that ballots will be mailed to inactive registered electors with a status designation of "inactive -failed to vote", but who voted in the last presidential election. 10. Postponement of Second Reading of Ordinance No. 131, 2011. Amending the Anneals Procedure Contained in Chapter 2, Article II, Division 3 of the City Code Relatingto o the Procedures for Hearing Appeals to the City Council to December 20, 2011. This item is being postponed to December 20, 2011, to allow time for public outreach. 11. First Reading of Ordinance No. 132, 2011, Authorizing the Purchasing Agent to Enter into an Agreement for the Financing by Lease -Purchase of Vehicles and Equipment and Appropriating the Amount Needed for Such Purpose.. This Ordinance authorizes the Purchasing Agent to enter into a lease -purchase agreement with Pinnacle Public Finance for the lease -purchase of vehicles and equipment. The cost of the items to be lease -purchased is $1,495,000. Payments at the 2.35% interest rate will not exceed $ 317,787 in 2012. Money for 2012 lease -purchase payments is included in the 2012 budget. The effect of the debt position for the purpose of financial rating of the City will be to raise the total City debt by 2.9%. A competitive process was used to select Pinnacle Public Finance for this lease. Staff believes acceptance of this lease rate is in the City's best interest. 12. First Reading of Ordinance No. 133, 2011, Amending Section 2-338 of the City Code Pertaining to the Duties and Functions of the Parks and Recreation Board, This Ordinance will modify the duties of the Parks and Recreation Board as contained in Section 2-338 of the City Code to broaden the scope of the Parks and Recreation Board's functions to allow the Board to promote awareness and appreciation of the value of parks and recreation as a resource contributing to the quality of Fort Collins. 85 October 18, 2011 13. First Reading of Ordinance No.134, 2011, Amending Chpter 23, Article V, ofhe City Code to Add New Provisions Related to the Naming of City Properties and Facilities. This Ordinance establishes a process for the City Council's responsibilities in the naming of City facilities or properties. The process defines how appropriate names are selected when a facility is to be named for a person (living or dead), or for an organization (e.g., foundations) or corporations. This Ordinance establishes Council's role in such facility naming and establishes the City Manager's authority to name other facilities. In addition to this Ordinance, an Administrative Policy is outlined which establishes staffs role in the naming of facilities in other circumstances. 14. Resolution 2011-093 Authorizing the City Manager to Execute a Grant Award and Agreement with the U.S. Department of Transportation for a Grant Pertaining to the Fort Collins -Loveland Municipal Airport. This Resolution authorizes the City Manager to execute a grant agreement with the United States Department of Transportation. The grant is in the amount of $221,500. The grant will be used to fund the Airport's efforts to address the air service needs of the community through completion of an air service development, communications and marketing plan for the Airport and development of a plan for the wingless flight program. 15. First Reading of Ordinance No.135, 2011, Authorizingthe he Appropriation of 2012 Fiscal Year Operating and Capital Improvement Funds for the Fort Collins -Loveland Municipal Airport. The 2012 annual operating budget for the Airport totals $779,550, and will be funded from Airport operating revenues, contributions from the Cities of Fort Collins and Loveland ($85,000 from each city), and interest earnings. This Ordinance authorizes the City of Loveland to appropriate the City of Fort Collins contribution, which is a 50% share of the 2012 Airport budget and totals $389,775. This Ordinance also appropriates the City's 50% share of capital funds, totaling $608,500 for the Airport from federal and state grants; contributions from Fort Collins and Loveland; and the Airport General Fund. Most of the 2012 Airport capital funds, totaling $1,217,000, will be used to continue major Airport improvements such as taxiway and apron rehabilitation and some funds are slated for utility master planning and design engineering to accommodate Airport business development. ***END CONSENT*** Ordinances on Second Reading were read by title by City Clerk Krajicek. Second Reading of Ordinance No. 128, 2011, Appropriating Unanticipated Revenue in the Capital Projects Fund for the Veterans Plaza Project at Spring Canyon Community Park. October 18, 2011 8. Second Reading of Ordinance No. 129, 2011, Authorizing the Acquisition by Eminent Domain Proceedings of Certain Lands Necessary to Construct Public Improvements Related to the Mason Corridor Bus Rapid Transit Project (Phase V). 9. Second Reading of Ordinance No. 130, 2011, Amending Chapter 7 of the City Code to Expand the Types of Registered Electors Who Automatically Receive Mail Ballots, and to Require the City to Pay the Postage Due for Ballots Returned by Mail. Ordinances on First Reading were read by title by City Clerk Krajicek. 11. First Reading of Ordinance No. 132, 2011, Authorizing the Purchasing Agent to Enter into an Agreement for the Financing by Lease -Purchase of Vehicles and Equipment and Appropriating the Amount Needed for Such Purpose. 12. First Reading of Ordinance No. 133, 2011, Amending Section 2-338 of the City Code Pertaining to the Duties and Functions of the Parks and Recreation Board. 13. First Reading of Ordinance No.134, 2011, Amending Chapter 23, Article V, of the City Code to Add New Provisions Related to the Naming of City Properties and Facilities. 15. First Reading of Ordinance No. 135, 2011, Authorizing the Appropriation of 2012 Fiscal Year Operating and Capital Improvement Funds for the Fort Collins -Loveland Municipal Airport. 19. First Reading of Ordinance No. 137, 2011, Making Annual Appropriations for the Downtown Development Authority for the Fiscal Year 2012 and Fixing the Mill Levy for Fiscal Year 2012. 20. Items Relating to Utility Rates, Fees and Charges for 2012. A. First Reading of Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges. B. First Reading of Ordinance No. 139, 2011, Amending Chapter 26 of the City Code to Revise Water Plant Investment Fees. C. First Reading of Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges. D. First Reading of Ordinance No. 141, 2011, Amending Chapter 26 of the City Code to Revise Sewer Plant Investment Fees. E. First Reading of Ordinance No. 142, 2011, Amending Chapter 26 of the City Code to Revise Electric Rates, Fees and Charges. J RE October 18, 2011 First Reading of Ordinance No. 143, 2011, Amending Chapter 26 of the City Code to Revise Electric Development Fees and Charges. G. First Reading of Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees. Councilmember Troxell pulled Item No. 9, Second Reading of Ordinance No.130, 2011, Amending Chapter 7 of the City Code to Expand the Types of Registered Electors Who Automatically Receive Mail Ballots, and to Require the City to Pay the Postage Due for Ballots Returned by Mail. Councilmember Manvel made a motion, seconded by Councilmember Troxell, 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. Staff Reports City Manager Atteberry discussed the Alliance for Innovation Big Ideas Conference, hosted by the City. The Conference provided the opportunity to showcase Fort Collins and.discuss the future of City Managers, cities and their relationships with City Councils. Councilmember Reports Councilmember Poppaw attended the Homelessness Prevention Initiative fundraiser and thanked members for their work in the community. Councilmember Manvel discussed his visit the Valmont Bicycle Park in Boulder. He stated the Poudre Heritage Alliance will be meeting on October 26th to discuss the potential National Heritage designation for the Poudre River. Mayor Weitkunat discussed the Urban Planning Design awards and congratulated the eleven winners. Ordinance No. 137, 2011, Making Annual Appropriations for the Downtown Development Authority for the Fiscal Year 2012 and Fixing the Mill Levy for Fiscal Year 2012, Adopted on First Reading The following is staff s memorandum for this item. "EXECUTIVE SUMMARY The Annual Appropriation Ordinance for the Downtown Development Authority is presented for First Reading. Ordinance No. 137, 2011, sets the Downtown Development Authority 2012 budget amount of S814,380 to be appropriated for fiscal year 2012 for the administrative operations October 18, 2011 budget; sets the amount of $1, 652, 346 for debt service payments to be appropriated for fiscal year 2012; and sets the 2012 Mill Levy for the Fort Collins, Downtown Development Authority at five (5) mills, unchanged since 2002. The approved budget becomes the Downtown Development Authority's financial plan for 2012. This Ordinance does not appropriate funds for projects or programs of the DDA funded with bond proceeds. Examples ofprojects and programs funded with bond proceeds include annual holiday light display, facade improvements, the enhanced alley annual maintenance costs, ice rink, and participation in the river district improvement projects, etc. BACKGROUND /DISCUSSION The Downtown Development Authority (the "DDA') was created in 1981 with the purpose, according to State statue, of planning and implementing projects and programs within the boundaries of the DDA. By state statue the purpose of the ad valorem tax levied on all real and personal property in the downtown development district, not to exceed five (5) mills, shall be for the budgeted operations of the authority. The DDA and the City adopted a Plan of Development that specifies the projects and programs the DDA would undertake. In order to carry out the purposes of the State statue and the Plan of Development the City, on behalf of the DDA, has issued various tax increment bonds, which require debt servicing. The DDA staff and Budget Committee are very cognizant of the changed revenue environment of the organization and economic conditions, and have made a strong effort to budget conservatively to reflect this climate. FINANCL4L /ECONOMIC IMPACTS The Fort Collins Downtown Development Authority is requesting approval of the DDA Operations and Maintenance budget, for fiscal year 2012, in the amount of $814,380. It is also requesting approval of the DDA debtpayment commitments in the amount of $1, 652, 346for 2012 obligations. Uses Personnel Services: $452, 768 Contractual Professional Services: 318,114 Purchased Supplies and Commodities: 23,635 Other: 19,863 Total $814,380 " The DDA debt service fund is projected to have sufficient revenue to meet the required debt service payments for 2012. Uses: Debt Payment: 2012 $1, 652, 346 " RUG October 18, 2011 Matt Robenalt, Downtown Development Authority Executive Director, stated this Ordinance sets the DDA mill levy and appropriates its operations and maintenance budget. Councilmember Horak asked if the DDA bonds currently being paid off went through the City of Fort Collins. Mr. Robenalt replied they were authorized by the City last year. Councilmember -Horak asked why the City cannot continue authorizing DDA bonds. Kathy Cardona, Downtown Development Authority Financial Coordinator, replied negotiations with the City regarding the 2010 bond issuance resulted in concern about the City's level of debt reserve. The City's Finance Director suggested seeking outside placement. However, negotiations with the City's finance department will occur again this week. Mike Beckstead, Chief Financial Officer, stated the City is open to entertaining the idea of supporting DDA's financing requirements. The General Fund reserve was not sufficient to support the $12.5 million bond placement. The current bond placement request of $4.5 million seems more possible. Councilmember Troxell made a motion, seconded by Councilmember Horak, to adopt Ordinance No. 137, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. fle9sunel 9 163arim 4114 Items Relating to Utility Rates, Fees and Charges for 2012, Adopted on First Reading The following is staffs memorandum for this item. "EXECUTIVE SUMMARY A. First Reading of Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges. B. FirstReading of Ordinance No. 139, 2011, Amending Chapter 26 of the City Code to Revise Water Plant Investment Fees. C. First Reading of Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges. D. First Reading of Ordinance No. 141, 2011, Amending Chapter 26 of the City Code to Revise Sewer Plant Investment Fees. E. First Reading of Ordinance No. 142, 2011, Amending Chapter 26 of the City Code to Revise Electric Rates, Fees and Charges. F. First Reading of Ordinance No. 143, 2011, Amending Chapter 26 of the City Code to Revise Electric Development Fees and Charges. all October 18, 2011 G. First Reading of Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees. The following overall monthly rate increases are recommended for 2012. % Increase Water 6.0% Wastewater 8.0% Electric 8.3% The water and wastewater rate increases are across the board to all customer classes. There is no change in the monthly rate for stormwater. City Council has requested additional data and time to study proposed changes to the electric residential energy service rate (hereafter referred to as "RESR'). Staff will return to Council on November 15, 2011, to recommend changes to the RESR. All other electric rates are included in the electric rate increase referenced above. The electric rate increases are proposed to vary by customer class from 3.9% to 15.9%. The proposed changes will impact individual electric customers more or less than the customer class averages. With the water and wastewater rate changes contained in the proposed ordinances, a typical single family customer's monthly bill will increase $4.44 from $138.66 to $143.10 or 3.2%. If revisions to the RESR are approved by Council at a later date, the typical residential customer will likely see an additional increase in costs. The later change will depend on the rate form option preferred by City Council. Changes to the water and wastewaterplant investmentfees and electric developmentfees will also go into effect if the proposed ordinances are approved. A 4.7% increase in water plant investment fees (PIFs) and a 1.2% increase in stormwater PIFs are proposed. A 3% reduction in wastewater PIFs is recommended. On average, electric development fees will increase from 1 % - 3.5% for residential and decrease less than 1 %for commercial. Several additional Code modifications and clarifications are also contained in the ordinances above. BACKGROUND /DISCUSSION Monthly Utility Rates The recommended 2012 rate increases differfrom the rates that were proposed in the original 2011- 2012 Budget. The changes are summarized in Attachment I and further explained by the staff memos included as Attachments 2 and 3. All proposed rates would be effective for meter readings on or after January 1, 2012. A. Monthly Water Rates (Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges) 91 October 18, 2011 Staff proposes a 6% water rate increase. The increase is across the board and applies to all rate classes. With the proposed rate, a typical single family residential customer's monthly bill will increase 6% as shown in the following table: Single Family 2011 Monthly Proposed 2012 Typical Use Water Bill Monthly Water $ Increase 0 % Increase Bill January $24.13 $25.58 $1.45 6% 5000 gallons July $65.11 $69.04 $3.93 6% 21,000 allons Monthly Average* I $35.87 1$38.05 1$2.18 6% *Average based on seasonal use of 117,131 gallons per year Although water rates were increased 3% in 2007, 2010 and in 2011, total Water Fund revenues decreased 23% between 2006 and 2010. The reduction in use is thought to be a combination of conservation, weather and economic factors. While water use is down, the vast majority of the costs of operating the water system are fired and do not vary based on customer use. The proposed 2012 rate increase is required to fund operations, capital improvements and maintain debt service coverage. Staff has increased projections for Water Fund capital projects needs between 2013 and 2020 by $33 million. Most of this increase is for distribution system replacement ($22 million). The distribution system project increase is a result of the preliminary data from the asset management program. The increase is not related to Halligan Reservoir which is to be funded from the Water Rights Reserve. The Water Rights Reserve is funded by developers' cash -in -lieu -of water rights payments and is restricted to the purchase of water rights and water storage only. See Attachment 2 for additional detailed explanation of the water rate increase. In addition, staffisproposing to eliminate unmetered construction waterfor customers with planned water services with meters greater than 1-inch. Staff is also recommending a monthly charge for V4-inch and 1-inch construction water service. Construction water will remain unmetered for 314- inch and 1-inch services but instead of a flat one time fee on the building permit (equivalent to 1.5 times the base charge for the future account), a monthly account will be established and billed a flat charge based on estimated construction use of 7000 gallons per month. Monthly billing will continue until the permanent meter is set. These changes are proposed to eliminate, or at least reduce, the extended over use of the unmetered construction service and will better reflect the cost of the water provided. Construction Water Fre u ncy o Billin 314-inch Meter 1-inch Meter Current 2011 Proposed 2012 One time charge onthly charge $ 20.40 $ 25.46 $ 50.93 $ 48.55 Includes PILOTS 92 October 18, 2011 B. Monthly Wastewater Rates (Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges.) Staff proposes an 8% wastewater rate increase for 2012. The increase is across the board and applies to all rate classes. With the proposed increase, a typical residential customer's bill will increase from $28.59 to $30.88 or $2.29 per month. The typical customer is based on 4,800 gallons of winter quarter water use. Council previously approved a series of annual wastewater rate increases starting in 2008. The prior rate increases, as well as the proposed 2012 increase, are necessary to fund wastewater operations and meet the increase in long term debtservice obligations for the now completed capital project which replaced the tricklingfilter, made odor control improvements and prepared forfuture regulatory requirements at the Mulberry Water Reclamation Facility. C. Mon th ly Electric Rates (Ordin an ce No. 142, 2011, Amending Chapter26 of the City Code to Revise Electric Rates, Fees and Charges.) Based on Council response at the September 13, 2011 Work Session, the electric rate ordinance does not contain any changes to the RESR, the rate applicable to the majority of residential customers. The changes to the RESR will be presented in a separate ordinance on November 15, 2011 and will contain several rate form alternatives. The ordinance for consideration at this meeting pertains only to the Residential Demand, Commercial (General Service, General Service 25, General Service 50), Industrial (General Service 750) and Traffic rates. Fort Collins ' wholesale and retail electric rates are among the lowest in the region and nation. This will continue to be true following the 8.3% electric rate increase proposed for 2012. The 8.3% increase is the system average and will not be equally applied to all customer rate classes. Based on a cost -of -service study, the proposed rates vary by rate class as follows: Proposed Rate Class Increases for 2012 Individual customers will varyfrom the class average. Summer increases (June, July and August) will be greater than average. RESR — Not included in Ordinance No. 142, 2011 6.0% Residential Demand Rate 15.9% General Service (small commercial less than 25 k99 3.9%. 1 General Service 25 (small commercial between 25-49 kW) 15.5% General Service 50 medium commercial between 50-749 k 8.7% General Service 750 (large comlindustrial greater than 749k 11.0% Traffic Signals 11.3% Floodlights 0.0% Average System Increase 8.3% '- New rate classes proposed for 2012 October 18, 2011 4.8% of the 8.3%system-wide increase is dire to a 6.4% increase in Platte River Power Authority's purchase power rates. In addition, Platte River's wholesale rate will be seasonal, with higher rates in June, July and August. Platte River's 2012 purchase power rate increase is due to several key factors: . • Reduced surplus sales • Increased operating and maintenance costs • Increased financing and depreciation costs as new projects are placed into service • Reduced interest income — due to low interest rates and lower cash reserves The remaining 3.5% of the 8.3% is required to reduce the use of Light and Power's reserves to cover the cost ofsystem improvements and replacements. While the reduction ofreserves has been intentional, expenditures in the Light and Power Fund have exceeded revenues each year since 2007. Even following the proposed 3.5% increase, expenditures are projected to exceed revenues for 2012. The larger commercial classes are experiencing a greater than average increase due to the shift of purchase power costs from demand charges to energy charges in Platte River's new rate form. Those customers with larger load factors, typically larger commercial and industrial customers and also the traffic signal system, will have larger than average increases in the purchase power components of their rates. (Load factor measures the consistency of power use over time.) Although the last cost -of -service study showed that the residential demand ("RD') rate was 18% under cost -of -service, all rate classes were limited to a 10% increase in 2011. The 2012 increase brings the RD rate class up to frill cost -of- service. The rate has traditionally been selected by high - use customers such as those who exclusively heat their homes with electricity. The increase to this rate will make the RESR more economical for many of the existing RD customers in 2012. Staff is also recommending that the RD rate be available only to those customers providing documentation that their home is heated entirely with electric energy. These changes will begin a phase -out of the RD rate. Electric Rate Form Changes Changes in the electric rate forms are necessary to align rates in support of the City's Energy Policy and Climate Action Plan goals. By adopting rate forms to incentivize customers to conserve and use energy more efficiently and by providing energy conservation assistance and programs to our customers, the City will more likely be able to achieve its policy goals. In addition, successful implementation of these tools will delay or defer the expense of constructing additional generation resources. Rate form changes are also needed to pass through the seasonal cost differentials that will be charged by Platte River Power Authority beginning in 2012. All rates will have higher costs in the summer (June, July and August) than during the remaining nine "non -summer" months. Consistent with Platte River, the recommended rates also shift a greaterproportion of the rate from the demand charges to energy charges. October 18, 2011 Rate form options were presented to the Council Finance Committee on August 15, 2011 and to the full Council at work sessions on September 13, 2011 and October 11, 2011. Based on Council's responses to the questions posed at the work sessions, there is a delay in the ordinance making changes to the RESR until November 15, 2011. Several options for the RESR ordinance will be presented at that time. The changes recommended for the RD and Commercial/Industrial rates seemed to have wide -spread support at the September 13 Work Session. The following summarizes changes to the electric rate forms that are included in the proposed electric rate ordinance. Residential Demand: The residential demand rate will be increased to the cost -of -service and energy charges will reflect the seasonal differential. The rate will be available only to customers who heat their residences exclusively with electricity. Small/Medium Commercial: The General Service rate is currently one rate class serving all commercial customers with average monthly demands of less than 50 kW. Staff is proposing that it be split into two rate classes beginning in 2012. 0 General Service - energy -only seasonal rate for customers with average monthly demands of less than 25 kW 0 General Service 25 - energy/demand seasonal rate for customers with average monthly demands of between 25 and 49kW • Large Commercial /Industrial: The recommended rate form changes for the GS50 and GS750 rate classes are due to Platte River's seasonal wholesale rate. 0 General Service 50 — add seasonal energy and coincident demand components for customers with average demands of between 50-749 kW 0 General Service 750 — add seasonal energy and coincident demand components for customers with average demands of 750 kW and greater Additional Amendments to Electric Article and Rates • Wholesale Transactions: Staff is recommending the addition of a Code section and definition to clarify terms of wholesale transactions and to specify that the retail rates, requirements and electric development fees do not apply to wholesale purchases. • Clarification of Net Metering Credit: Staff is recommending that the rate schedule specify that credits for net excess generation due to net metering will be based on the summer season retail energy charge as reflected in the new rate structure. • Clarification of Parallel Generation Credit: Staff is recommending that the rate tariff schedule specify that credits for parallel generation delivered to the utility will be based on Platte River Power Authority's avoided cost rate. • Clarification of Distribution Facilities Demand: The proposed change more fully defines distribution facilities demand for the large commercial and industrial rate classes and a, October 18, 2011 permits the Utilities Executive Director to use an alternative method to recover a customer's cost -of -service share of distribution demand if the costs associated with serving a customer are not fully recovered by the standard rate. Monthly Rate Increase Summary The following chart summarizes the impact of the proposed rate changes on a typical single family residential customer: Typical Residential Customer — Monthly Utility Bill Current Estimated $ % 2011 2012 Increase Increase Electric 700 kWh/mo $59.94 $59.94 Wastewater 4,800 gal/mo WQA $28.59 $30.88 $2.29 8.0% Stormwater 8,600 sq.ft. lot, light runoff $14.26 $14.26 $0.00 0.0% Water 117,131 gal/yr $35.87 $38.03 $2.15 6.0% Total Estimated Average Monthly $138.66 $143.10 $4.44 3.2% Utility Bill * The 2012 electric RESR will not be considered by Council until a later Council meeting an therefore will not be effective as of January 1, 2012. A change, averaging 6% is expected to b effective February 1, 2012. The following charts compare Fort Collins Utilities' monthly rates to others along the FrontRange. The electric rate shown for Fort Collins for 2012 is the current 2011 rate. A change to the RESR is expected to be effective in February. The average change to the residential energy rate class is projected to be 6%. Plant Investment Fees (PIFs) and Electric Development Fees City Code requires staff to present water, wastewater and stormwater plant investment fees to Council for approval no less than every other. year..These fees were last changed in 2009 effective on January 1, 2010. Staff is recommending changes to each of the wet utility PIFs. Water and Stormwater PIFs are increasing 4.7% and 1.2% respectively. Wastewater PIFs are recommended to decrease 3%. Electric development fees are also required to be approved by City Council no less than every second year, although historically staff has recommended annual changes. The current electric development fees were approved by Council in 2010 and were effective January 1, 2011. .o October 18, 2011 Staff is recommending the following changes to be effective on January 1, 2012 A. Water PlantInvestment Fees (Ordinance No. 139, 2011, Amending Chapter 26 ofthe City Code to Revise Water Plant Investment Fees.) The water plant investment fees were developed to recover the current value ofpast investment and the current value of future growth -related investment through 2040. This method includes calculating net water system equity, capacity units and determining the net system equity per unit. The Water PIFs are calculated to increase an average of 4.7% for 2012. There are two majorfactors influencing the increase. First, projected capital improvements related to regulatory requirements have been allocated to the PIFfor that portion of the improvements that will serve new growth. Other revisions have been made to the long range capital improvementplan which also impacted the Water PIF calculations. Together, these capital changes have increased the PIF requirement. The second factor offsets the increase. In 2009, detailed information was not available to classify the construction work in progress. The decision was made to treat it all as backbone related capital additions. This overstated the 2010 PIF requirement. Since that time, additional reporting is available to clearly classify the work in progress. This resulted in a reduction in equity of the backbone system. Water PIF charges for a typical single family lot (8600 sq ft) would increase from $3, 826 to $4, 084 or $258. The following table shows the proposed increases for water PIFs. Water Plant Investment Fees 2011 2012 Existing Proposed % Change Single Family Residential. Domestic Interior Use - Flat Charge $ 730 $ 730 0.0% Exterior Use - $/Sq ft $ 0.36 $ 0.39 8.3% Duplex and Multi Family: Domestic Interior Use - Charge per Unit $ 490 $ 510 4.1 % Exterior Use - $/Sq ft $ 0.27 $ 0.27 0.0% Non -Residential by Meter Size 314" $ 7,530 $ 7,880 4.6% Pf $ 21,730 $ 22,750 4.7% 1-1/2" $ 45,300 $ 47,410 4.7% 2" $ . 69,070 $ 72,290 4.7% r 3" $ 157,920 $ 165,290 4.7% 4" and above assessed on individual basis B. Wastewater/Sewer Plant Investment Fees (Ordinance No.141,2011,AmendingChapter 26 of the City Code to Revise Sewer Plant Investment Fees.) 97 October 18, 2011 The wastewaterplant investmentfees were developed to recover the current value ofpast investment and the current value of future growth -related investment through 2040. This method includes calculating net wastewater system equity, capacity units and determining the net system equity per unit. The Wastewater PIFs are calculated to decrease 3% for 2012. Like the Water PIF this reduction is in part due to a change in the basis for calculating construction work in progress. Other recent revisions to the long range capital improvementplan have reduced the Wastewater PIF calculations. Wastewater PIF charges for a single family lot would decrease from $3,550 to $3, 440, a reduction of $110. The following table shows the proposed changes. Wastewater Plant Investment Fees 2011 2012 Existing Proposed % Change Single Family Residential $ 3,550 $ 3,440 -3%- Duplex and Multi Family, per unit $ 2,490 $ 2,410 -3% Non -Residential by Water Meter Size 314" $ 7,100 $ 6,880 -3% 1" $ 17,880 $ 17,300 -3% 1-112" $ 31,490 $ 30,480 -3% 2" $ . 55,290 $ 53,520 -3% 3" $ 150,130 $ 145,310 -3% 4" and above assessed on individual basis C. Electric Development Fees (Ordinance No. 143, 2011, Amending Chapter 26 of the City Code to Revise Electric Development Fees and Charges.) Electric developmentfees recover both actual on -site costs (building site charges) and allocated off - site costs (electric capacity charges) to serve commercial or residential development. These fees are typically adjusted annually to reflect changes in costs. Proposed 2012 fees will increase slightly for some developments (1%-3%) and decrease slightly for others. The table below shows the changes for a typical single family lot and a model commercial development. Typical Single Family Lot 8600 s uare eet, 70 oot of street ronta e, 150 amp service, 410 secondary service Current 2011 1 Proposed 2012 $ Change I % Change $3,139 J$3,233 $94 13.0% Model Commercial Development 82,000 sq ft, 1900 ft street frontage, transformer 250 ft primary srv, 600 amps, 208Volt, 3-phase, I - October 18, 2011 Current 2011 1 Proposed 2012 1 $ Change I % Change $31, 076 JS30,981 -$95 -0.3 D. Stormwater Plant Investment Fees (Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees) The Stormwater PIFs are recommended to increase 1.2% in 2012. The increase represents a $7.3 million increase in capital facilities added since the last study. However, annexation has caused -- an increase in total developed and developable acres which results in an increased divisor in the calculation. The two changes result in a modest increase of 1.2%. The PIF will increase from $6, 313 per acre to $6, 390 per acre. Stormwater PIF charges for a typical single family lot would increase from $1,069 to $1,082, an increase of $13. PIF Change Summary The following chart summarizes the impact of the proposed PIF and development fee changes on a typical residential lot: PIF Chan es or Typical Sin le Famil Current Proposed Change Change 2011 2012 % $ Water' $3, 826 $4, 084 6.7% $258 Raw Water' $5,203 $5,203 0.0% $0 Wastewater $3, 550 $3, 440 -3.1 % (-$110) Stormwater] $1,069 $1,082 1.2% $13 Electric' $3,139 $3,233 3.0% $94 Total 1787 1$17,042 11.5% $255 'Typical, based on lot size of 8,600 sq. ft.; 70 foot street frontage 2No increase for Raw Water 3 8, 600 sq. ft. lotplus estimated 6,156 sq. ft common area and right-of-way; .5 run off coefficient Next Steps: November 1, 2011 City Council Meeting -Second Reading of these seven Ordinances November 15, 2011 City Council Meeting First Reading of Residential Energy Service Rate Ordinance with seasonal and seasonal - tiered options WE October 18, 2011 First Reading of Service Charges Ordinance with increases for after-hours service charges and a monthly fee for manual meter reading for customers who opt out of the Advanced Meter Fort Collins project. December 6, 2011 City Council Agenda • Second Reading of Residential Energy Service Rate Ordinance • Second Reading of Service Charges Ordinance January 1, 2012 • Effective date of the -seven Ordinances included in this agenda item summary and for changes in service charges. (Monthly rate ordinances are effective for billings with meter readings on or after this date) February 1, 2012 Proposed effective date ofResidential Energy Service Rate Ordinance. (Effective for billings with meter readings on or after this date.) FINANCL4L /ECONOMIC IMPACTS The rates are projected to increase 2012 annual operating revenues of the Water Fund by 6°yo, the Wastewater Fund by 8% and the Light and Power Fund by 8.3%. (The short delay in adopting the RESR increase will slightly reduce the increase for Light and Power.) The projected revenue from the rate increases is included in the revised 2012 budget projections. The increases are necessary to find purchase power, operations and system additions and replacements and to meet debt service requirements. The proposed water and wastewater rate ordinances will increase costs for a typical residential customer by $4.47 per month if such customer's water use remains unchanged. An additional change to the RESR at a later date will change the total increase. That amount will depend on the rate form option selected by Council at the November 15, 2011 Council meeting. Utilityprograms can help customers to reduce their water and electric use and to lessen the financial impact of the rate increases. ENVIR01VIVENTAL IMPACTS Funding from the proposed electric rate increase will allow the Utilities to continue programs and services aimed at meeting the goals and objectives of the Energy Policy and Climate Action Plan. Accurate seasonal price signals may delay/avoid the need for additional peak electric generation. Water and wastewater rates provide funding for conservation programs and environmental regulatory compliance. " 100 October 18, 2011 Ellen Switzer, Utilities Financial Operations Manager, discussed the Ordinances, including the proposed increases in monthly utility rates: 6% for water, 8% for wastewater, and 8.3% for electricity, which will vary by rate class. Bills can be reduced by reductions in consumption. Despite the rate increases, revenues will continue to be less than expenses in 2012. Operations and maintenance expenses, however, have decreased. John Anderson, Fort Collins resident, requested real world solutions for sustainability. Eric Sutherland, 3520 Golden Currant, expressed concern regarding using electric rate increases to pay for operations and maintenance expenses. Councilmember Manvel asked about Switzer's statement that operations and maintenance costs have decreased. Switzer clarified that the City's operations and maintenance costs are down. Councilmember Kottwtiz asked if the idea to borrow from the water reserves to fund the Discovery Museum had previously been discussed. Switzer replied it is the same fund that made the loan to the Discovery Musem; however the loan is still viewed as an asset in the reserves and has no effect on the rate increase. Councilmember Kottwitz asked for clarification regarding rate increases which will occur as a result of water conservation. Bill Switzer, Utility Rate Analyst, replied the water rates are tiered which may result in a higher rate but lower overall bills. ' Councilmember Kottwitz requested additional information regarding the extra charge for residential customers to opt out of the AMI program. , Councilmember Kottwitz requested a rough estimate of the increase in fees for construction water consumption changing from a flat fee to a monthly fee. Ms. Switzer replied the current charge is just over $20 for unlimited water, until the meter is set. The proposal would increase the fee to just over $25 per month, for an estimated use of 7,000 gallons per month. Councilmember Troxell asked how many water taps in Fort Collins belong to the City Utility. Ms. Switzer replied there are approximately 35,000 accounts as part of the City Utility. Councilmember Troxell asked if the other water districts within City limits are requesting 6% rate increases. Ms. Switzer replied she was unsure. Councilmember Troxell asked what measures have been taken to decrease systems costs. Brian Janonis, Utilities Executive Director, detailed various cost reduction measures. Mayor Pro Tem Ohlson asked about the City's policy regarding electric heat in multi -family dwellings. Steve Catanach, Light and Power Operations Manager, replied plant investment fees are intended to be a cost recovery element and do take into account the added infrastructure required to support an all -electric development. 101 October 18, 2011 Mayor Pro Tem Ohlson asked for input regarding means by which consumers can be encouraged to conserve. Catanach replied the City's Customer Information Program discussed the benefits of conservation, which is required by the State. Additionally, bills are reduced by conservation efforts, despite a customer's rate potentially increasing. Councilmember Horak asked. if PRPA has been consulted regarding references to increased wholesale rates. Assistant City Attorney Carrie Daggett, replied PRPA has been contacted; however, the references are more related to the City system. Councilmember Horak asked about the consequences of not approving the rate increases. Janonis replied some capital improvement projects and operations and maintenance expenses would need to be taken out of the budget. Councilmember Horak requested input on acquiring additional revenue in order to reduce future rate increases. Catanach replied efficiency in use of resources will help to control long-term costs. Mayor Weitkunat requested a concise explanation of the wastewater and water increase. Catanach replied part of the reason relates to the cost of rebuilding the failed Mulberry plant. Ms. Switzer replied the water increase is due to a decline in revenues and demand. Councilmember Manvel made a motion, seconded by Mayor Pro Tern Ohlson, to adopt Ordinance No. 138, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Councilmember Horak made a motion, seconded by Councilmember Troxell, to adopt Ordinance No. 139, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Councilmember Troxell made a motion, seconded by Councilmember Manvel, to adopt Ordinance No. 140, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Mayor Pro Tem. Ohlson made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 141, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 102 October 18, 2011 Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 142, 2011, on First Reading. Councilmember Kottwitz expressed concern about the commercial rates The vote on the motion was as follows: Yeas: Weitkunat; Mdhvel, Ohlson, Poppaw, Horak and Troxell. Nays: Kottwitz. THE MOTION CARRIED. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 143, 2011, on First Reading. Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: Kottwitz. THE MOTION CARRIED. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 144, 2011, on First Reading. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. ("Secretary's note: The Council took a brief recess at this point in the meeting.) Resolution 2011-094 Directing Certain Actions Be Taken to Improve Coordination and Consultation Between the City and Platte River Power Authority in Connection with the Dixon Creek Substation to Horseshoe Substation Transmission Line Project and for Future Proiects, Adopted The following is staffs memorandum for this item. "EXECUTIVE SUMIIIARY This Resolution directs the City Manager and CityAttorney to take certain follow up actions in light of recent discussions and analysis related to the Platte River Power Authority Dixon Creek Substation to Horseshoe Substation Transmission Line Project. The City Council discussed this issue at its adjourned meeting on October 11, 2011, and the Resolution calls for follow up work to: (1) address impacts from the proposed Project; (2) develop a set of policies and procedures for planning and consultation related to future Platte River projects; and (3) improve the City's level ofinvolvement infuture infrastructure andspecificprojectplanning by Platte River. The Resolution also directs the City Manager to provide a copy of the Resolution to Platte River and the other Platte River member cities. 103 October 18, 2011 BACKGROUND /DISCUSSION At its October 11, 2011 meeting Council directed City staff to develop a resolution expressing the intent of the City Council that the City Manager and City Attorney work closely with Platte River staff, and that the City's representatives on the Platte River Board of Directors work closely with their counterparts on the Platte River.Board, in order to establish procedures and policies that will improve the level of coordination and communication regarding Platte River infrastructure and project planning. This direction grew out of a review of a proposed transmission line that crosses Pineridge Natural Area. The review was conducted by a consulting firm (SAIC) on behalf of PRPA and the City. Based on that review, Council concluded that the proposed alternatives to the existing project were not worthy of support at this time. However, Council desires improved communication and influence with respect to PRPA project infrastructure planning and implementation and directed staff to create 'a resolution that specifically referenced a number of areas for improved communication and collaboration, including: r 1. formal notice to the general public and property owners in the vicinity of the proposed project; 2. formal notice to City representatives, including the Mayor and City Manager; 3. written description and analysis ofalternative means to accomplish the project, alternative routes, configurations and designs, and analysis of related impacts, costs and benefits; 4. detailed analysis of natural resource, aesthetic and other impacts and evaluation of means by which such impacts may be avoided, minimized, or offset; and 5. a process for soliciting and considering input by City boards and commissions and the City Council. Included in the Resolution is direction to staff to develop a written plan to avoid, minimize, and offset impacts associated with the Pineridge crossing. " Eric Sutherland, 3520 Golden Currant, stated the City's communication with PRPA should be improved. Joel Bladow, 6107 Ashton Court, Tri-State employee, commended Fort Collins utilities and supported the Resolution. Councilmember Manvel made a motion, seconded by Councilmember Troxell, to adopt Resolution 2011-094. Mayor Pro Tern Ohlson expressed concern regarding references to City property and noted Council's intention is to include City -owned property, as well as all property, public or private, located in the City's growth management area. City Manager Atteberry confirmed that intent and stated the City and PRPA have a strong relationship. 1[IL! October 18, 2011 Joe Wilson, PRPA General Counsel, stated that PRPA has agreed to work closely with the City to develop plans and procedures for future consultation and review of PRPA projects on or impacting City property. Assistant City Attorney Daggett suggested wording including "City -owned property and properties within the growth management area" and discussed the two sections of the Resolution which should include the phrase. Councilmember Manvel made a friendly amendment to change the wording in both referenced sections. Councilmember Troxell accepted the friendly amendment. Councilmembers and staff held a lengthy discussion regarding a systems approach versus a project - by -project approach. Mayor Pro Tern Ohlson requested follow-up regarding a suggestion he had made to work with PRPA to include viewsheds and wildlife habitat among its list of stated values. The vote on the motion to adopt Resolution 2011-094, as amended, was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Ordinance No..130, 2011, Amending Chapter 7 of the City Code to Expand the Types of Registered Electors Who Automatically Receive Mail Ballots, and to Require the City to Pay the Postage Due for Ballots Returned by Mail Postponed to November 1 2011 The following is staffs memorandum for this item. "EXECUTIVE SUM1IARY This Ordinance, unanimously adopted on First Reading on October 4, 2011, amends the City Code to require that ballots in a. City mail ballot election be mailed to inactive registered electors who voted in the last presidential election in addition to all active registered electors. In addition, the Code will be amended to require that the City pay postage on all voted ballots returned by mail. Both amendments are anticipated to increase voter participation. This Ordinance has been amended on Second Reading to add language clarifying that ballots will be mailed to inactive registered electors with a status designation of "inactive failed to vote", but who voted in the last presidential election. " Councilmember Troxell noted including postage -paid return envelopes for City elections could cause some confusion as County elections would not include postage. Additionally, he requested information regarding the "inactive failed to vote"(IFTV) status and the process by which the County amends voter lists. Deputy City Clerk Harris replied the National Change of Address 105 October 18, 2011 Database is used by the County to check its voter registration addresses. Following each November election, the County sends a mailing to all inactive voters in an effort to update voter registration and change their status to possibly active, cancelled, or inactive undeliverable. Councilmember Troxell asked which list the City is using when it expands its mailing to include the IFTV voters. Harris replied the City's current IFTV count is approximately 11,400 in Fort Collins. The City would be mailing to a subset of those voters who did vote in the 2008 presidential election. No inactive voters will receive ballots in 2013 as voters who did not vote in the 2012 presidential election would not receive ballots. Councilmember Kottwitz expressed concern about unintentional voter fraud and increased cost and suggested making the changes for one election before making permanent changes. Mayor Weitkunat asked about the ability to track returned ballots. Harris replied the City's voter database will be used to segregate out the IFTV ballots for the number returned voted, undeliverable, and those unreturned. Mayor Pro Tem Ohlson stated he would have preferred the criteria for not receiving a ballot to be not having voted in two general, or even -year, elections in a row. Councilmember Manvel made a motion, seconded by Mayor Weitkunat, to adopt Ordinance No. 130, 2011, on Second Reading. Councilmember Manvel made a friendly amendment to change the language to reference mailing to inactive failed to vote electors who voted in at least one of the last two elections. Councilmember Kottwitz asked about the possibility of voters receiving ballots from the City but not the County. Hams replied there is a possibility that up to 20,000 voters could receive a ballot from the City but not the County if the County were conducting a normal mail ballot election. Councilmember Kottwtiz suggested instituting a pilot program. Councilmember Horak suggested postponing the item until November 1, 2011 and including a Resolution outlining the process. Councilmember Manvel made a motion, seconded by Councilmember Troxell, to postpone the item to November 1, 2011. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 106 The meeting adjourned at 9:40 p.m. ATTEST: City Clerk Adjournment SEAL N October 18, 2011 IDIFA