HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 10/03/2006 - SECOND READING OF ORDINANCE NO. 149, 2006, APPROPR ITEM NUMBER: 16
AGENDA ITEM SUMMARY DATE: October 3, 2006
FORT COLLINS CITY COUNCIL STAFF: Darin Atteberry
SUBJECT
Second Reading of Ordinance No. 149, 2006, Appropriating Unanticipated Revenues in the City's
General Fund and Prior Year Reserves in the Wastewater Fund for the Purpose of Recording the
Transfer of Certain Surplus Properties from the Utilities to the General Fund in Exchange for Certain
Properties Historically Used for Utilities Purposes but Not Acquired with Ratepayer Revenues and
Approving Said Transfer.
RECOMMENDATION
Staff recommends adoption of the Ordinance on Second Reading.
EXECUTIVE SUMMARY
This Ordinance, unanimously adopted on First Reading on September 19, 2006, exchanges
properties between Utilities and other non-Utilities City purposes. City staff has identified two
properties formerly used by Utilities but no longer needed for Utilities purposes-the remaining 25-
acre portion of the Wastewater Utility's Resource Recovery Farm and the Electric Utility's Old
Power Plant Building at 430 North College Avenue. In exchange for these properties,four properties
will be transferred to Utilities. The properties to be transferred to Utilities include three sites that
are,and have for years,been in use for Utilities purposes but were not purchased with Utilities funds
initially: the Water Treatment Plant #1 site (the area not in use as Gateway Park), the Old
Waterworks property on North Overland Trail,and the Mulberry Wastewater Treatment Plant. The
fourth property for possible transfer to Utilities is the Police Annex site, Lots 36 and 37, less the
north 80 feet, of Block 32 in the City of Fort Collins. This property may be an appropriate future
location for Utilities' Customer Information Services office, when it is relocated from 330 South
College Avenue. The Charter requires Utilities to reimburse other City funds for services received,
and vice-versa. The City's Real Estate Services staff has prepared value estimates for each of the
properties and,based on those estimates,Utilities will pay the amount of$13,400,the difference in
total values, to the General Fund in order to make the exchange an even one.
ITEM NUMBER: 21
AGENDA ITEM SUMMARY DATE: September 19, 2006
FORT COLLINS CITY COUNCIL STAFF: Darin Atteberry
SUBJECT
First Reading of Ordinance No. 149, 2006, Appropriating Unanticipated Revenues in the City's
General Fund and Prior Year Reserves in the Wastewater Fund for the Purpose of Recording the
Transfer of Certain Surplus Properties from the Utilities to the General Fund in Exchange for
Certain Properties Historically Used for Utilities Purposes but Not Acquired with Ratepayer
Revenues and Approving Said Transfer.
RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
FINANCIAL IMPACT
The total value of the propertie o be trUerrei hies exeds the total value of the properties
transferred from Utilities by$13, this nce to the General Fund,in order
to make the exchange even. Internal payments from the respective Utility funds will be made based
upon the value of property conveyed from and to each. The transfer of the properties would be
recorded as a sale of property in the General Fund totaling$2,088,400 and a corresponding purchase
by the Utilities as follows:
Wastewater Fund—Mulberry Wastewater Treatment Plant#1 $ 805,000
Water Fund—Water Treatment Plant#1 (Gateway) $ 603,400
Water Fund—Old Waterworks $ 245,000
Light & Power Fund—Police Annex $ 220,980
Water Fund—Police Annex $ 120,930
Wastewater Fund—Police Annex $ 47,850
Storm Drainage Fund—Police Annex $ 45,240
Total $2,088,400
The transfer of the surplus pro rties fftCU)iies o 'lye as a sale of property by the
Utilities as follows:
Wastewater Fund—Resource Recovery Farm Parcel $2,000,000
Light & Power Fund—Power Plant $ 75,000
Total $2,075,000.
Unanticipated revenue in the General Fund from recording the sale of the properties ($2,088,400)
to the respective Utilities will be used to fund the appropriation needed by the General Fund to
purchase the properties to be acquired from Utilities.
September 19, 2006 -2- Item No. 21
Appropriations exist within the various Utility funds to record said transfer(purchase)of properties
for Utilities, except for $848,400 in the Water Fund for the Water Treatment Plant #1 parcel
($603,400) and the Old Water Works parcel ($245,000). These funds are available in the Water
Fund from prior year reserves.
�11�) P
..
EXECUTIVE SUMMARY ;
This Ordinance exchanges properties between Utilities and other non-Utilities City purposes. City
staff has identified two properties formerly used by Utilities but no longer needed for Utilities
purposes-the remaining 25-acre portion of the Wastewater Utility's Resource Recovery Farm and
the Electric Utility's Old Power Plant Building at 430 North College Avenue. In exchange for these
properties,four properties will be transferred to Utilities. The properties to be transferred to Utilities
include three sites that are, and have for years, been in use for Utilities purposes but were not
purchased with Utilities funds initially: the Water Treatment Plant #1 site (the area not in use as
Gateway Park), the Old Waterworks property on North Overland Trail, and the Mulberry
Wastewater Treatment Plant. The fourth property for possible transfer to Utilities is the Police
Annex site, Lots 36 and 37, less the north 80 feet, of Block 32 in the City of Fort Collins. This
property may be an appropriate future location for Utilities' Customer Information Services office,
when it is relocated from 330 South College Avenue. The Charter requires Utilities to reimburse
other City funds for services rece' d and ce-ver a. The City' Real Estate Services staff has
prepared value estimates for e of t ope s d, s on ose estimates, Utilities will pay
the amount of$13,400, the d erence total 1 o the eneral Fund in order to make the
exchange an even one.
BACKGROUND
Surplus Utilities Properties
In 1979, the City's Wastewater Utility acquired approximately 350 acres of land known as the
"Resource Recovery Farm", located southwest of the intersection of Interstate 25 and Prospect
Road. The Wastewater Utility developed the Resource Recovery Farm as a beneficial reuse site for
its biosolids operation,which continued in that location until it became a less desirable location for
the purpose and all biosolids operations were relocated to Meadow Springs Ranch as of the year
2000. In 2000 and 2003, the City Council adopted Ordinance No. 199, 1999, and Ordinance No.
098,2003,respectively,each of which authorized the transfer of portions of the Resource Recovery
Farm totaling approximately 3 7watc,
s if as Program in exchange for a
payment to the Utility. The W t tility s e e for the remaining portion of the
Resource Recovery Farm,a 25 r at th o east corn of the original Resource Recovery
Farm (the"RRF Parcel").
In the late 1930's, the City established its own municipal light and power utility. A power plant
facility was constructed on land owned by the City, located at 430 North College Avenue,
immediately to the south of the Cache La Poudre River and east of College Avenue, commonly
referred to as the "Old Power Plant". As of 1973, the City no longer generates its own electricity
and instead purchases all power from Platte River Power Authority. The City's Electric Utility has
no further use for the Old Power Plant building("the Power Plant").
September 19, 2006 -3- Item No. 21
City staff has determined the City has other non-Utility uses and potential interest in the RRF Parcel
and the Power Plant. The RRF Parcel has been identified as the possible location for new
development to be arranged by the City consistent with City land use and economic health plans and
objectives. In recent years, the 1 di le to Colorado State University
for its Small Engines Laborato and i i tici to th it identify other similar uses of the
property in the future, workin ith CS and e artner or izanonS.
The City's Real Estate Services staff has prepared value estimates for the RRF Parcel and the Power
Plant. Based on a review of the properties and comparable sales analysis, the value of the RRF
Parcel is estimated to be $2,000,000 and the Power Plant estimated to be $75,000.
Historic Utilities-Used Properties
In recent years, the City's Finance Department has increased its scrutiny of accounting for and
documentation of the City's general governmental infrastructure assets, including real property
assets, and has implemented new procedures for identifying and tracking such assets. As a result
of this increased scrutiny, and in response to questions regarding the source of purchase funds for
various City-owned properties, staff has reviewed the records of the City's land holdings and their
historic uses, and has determined that certain properties in use by the City's Utilities are not shown
to have been acquired using ratepayer revenues.
The properties in use by Utili s or o icu lu Y
to Utilities that have not been
determined to have been purc ed by lities e•
1. for the Water Utility,the 209-acre portion of the Water Treatment Plant#1 property
not in use for Gateway Park ("WTP #1");
2. for the Water Utility,the 25-acre original waterworks property north of Fort Collins
on Overland Trail (the"Old Waterworks"); and
3. for the Wastewater Utility, the 14-acre property on which Wastewater Treatment
Plant#1, the Mulberry Plant, is located (the "Mulberry Plant").
Real Estate Services staff has prepared value estimates for WTP #1, the Old Waterworks and the
Mulberry Plant. Based on a review of the properties and comparable sales analysis, the value of
WTP #1 is estimated to be $603,400, the Old Waterworks to be $245,000, and the Mulberry Plant
to be $805,000.
Utilities Customer Informat' Ser i Of
For the past few years, Utilitie een in or a Ynecation for the Utilities Customer
Information Services office, currently located in facilities rented by the City at 330 South College.
A location in the Old Town area,with easy public access,is particularly desirable for this use. With
the construction of the new Police Services Building near the intersection of Timberline Road and
Drake Avenue, staff has begun the process of planning for the future use of current Police Services
facilities, including the Police Annex, a .14-acre site near the northeast corner of LaPorte Avenue
and Howes Street (the "Police Annex"). The City Manager, in consultation with the Utilities
General Manager, has detennined that the Police Annex may be a desirable location for use by
September 19, 2006 -4- Item No. 21
Utilities for its Customer Information Services office,funded proportionally by each of the Utilities.
The transfer of this or some similarly valued property in the Old Town area, depending upon exact
plans and arrangements to Utilities of the Police Annex site will be necessary for future planning
and preparation for developmeCiv
U ' ' ' , C e to ion Services facilities.
Real Estate Services staff has p e est a s or the lice Annex,and,based on a review
of the properties and comparaban h timate a value of the Police Annex to be
$435,000.
Considerations in Developing the Proposed Exchange
All real property of the City is titled in the name of the City of Fort Collins. Therefore,the historical
records regarding real property acquisitions by the City do not clearly identify the source of funds
used to purchase each property, or for what functions or part of the City organization the property
was purchased. However, Section 23 of Article V of the City Charter requires that expenses
incurred by other parts of the City organization in providing services to the City's Utilities be fully
paid by the particular Utility receiving the services, and vice-versa. In addition, the Finance
Department has increased the level of detail in accounting for the City's real property assets,
including the source of purchase funds and"ownership"of City real property among enterprise and
other individual Funds. Consequently, staff has recommended the proposed transfers be completed
in order to clarify those real pro th apastate
' 's tilities systems.
Based on the value estimate omplet by S ices staff, the total value of the
properties described herein to tratisf itie a "Historic Use Properties"), as
described above, is $2,088,400, and the total value of the properties described herein to be
transferred from the Utilities(the"Surplus Utilities Properties"),as described above,is$2,075,000.
The net difference between these two totals, or$13,400, will be a net gain to the General Fund, to
balance out the exchange.
COPY"
ORDINANCE NO. 149, 2006
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING UNANTICIPATED REVENUES IN THE CITY'S GENERAL FUND
AND PRIOR YEAR RESERVES IN THE WASTEWATER FUND FOR THE PURPOSE
OF RECORDING THE TRANSFER OF CERTAIN SURPLUS PROPERTIES FROM
THE UTILITIES TO THE GENERAL FUND IN EXCHANGE FOR
CERTAIN PROPERTIES HISTORICALLY USED FOR UTILITIES PURPOSES
BUT NOT ACQUIRED WITH RATEPAYER REVENUES
AND APPROVING SAID TRANSFER
WHEREAS, the City's Wastewater Utility acquired in 1979 approximately 3 50 acres of land
known as the"Resource Recovery Farm",which is located southwest of the intersection of Interstate
25 and Prospect Road; and
WHEREAS, the Wastewater Utility developed the Resource Recovery Farm as a beneficial
reuse site for its biosolids operation,which continued in that location until it became a less desirable
location for the purpose and all biosolids operations were relocated to Meadow Springs Ranch as
of the year 2000; and
WHEREAS, in 2000 and 2003, the City Council adopted Ordinance No. 199, 1999, and
Ordinance No. 098, 2003, respectively, each of which authorized the transfer of portions of the
Resource Recovery Farm totaling approximately 325 acres to the City's Natural Areas Program in
exchange for a payment to the Utility; and
WHEREAS, the Wastewater Utility has no further use for the remaining portion of the
Resource Recovery Farm,a 25-acre parcel at the northeast corner of the original Resource Recovery
Farm more particularly described on Exhibit A, attached hereto and incorporated herein by this
reference (the "RRF Parcel"); and
WHEREAS,in the late 1930's the City established its own municipal light and power utility,
and constructed on land owned by the City immediately to the south of the Cache La Poudre River
and east of College Avenue a power plant facility, commonly referred to as the"Old Power Plant";
and
WHEREAS, the City no longer generates its own electricity, instead purchasing all power
from Platte River Power Authority, and the City's Electric Utility has not used since 1973, and has
no further use for, the Old Power Plant building,the address of which is 430 North College Avenue,
and which is shown and described on Exhibit B, attached hereto and incorporated herein by this
reference (the "Power Plant"); and
WHEREAS, City staff has determined that the City has other non-Utility uses and potential
interest in the RRF Parcel and the Power Plant; and
WHEREAS, the City's Real Estate Services staff has prepared value estimates for the RRF
Parcel and the Power Plant, and,based on a review of the properties and comparable sales analysis,
has estimated the value of the RRF Parcel to be$2,000,000 and the Power Plant to be$75,000, and
together total $2,075,000; and
WHEREAS, the City's Finance Department has embarked on thoroughly researching and
appropriately classifying the City's capital assets, including real property assets, and has
implemented procedures for identifying and tracking such assets; and
WHEREAS,City staff has reviewed the records of the City's land holdings and historic uses
of the same, and has determined that certain properties in use by the City's Utilities are not shown
to have been acquired using ratepayer revenues; and
WHEREAS, those properties in use by or useful to Utilities that have not been determined
to have been purchased by Utilities are:
1) for the Water Utility, the 209-acre portion of the Water Treatment Plant#1 property
not in use for Gateway Park,more specifically described and shown on Exhibit"C",attached hereto
and incorporated herein by this reference ("WTP #1");
2) for the Water Utility,the 25-acre original waterworks property north of Fort Collins
on Overland Trail, more specifically described and shown on Exhibit "D", attached hereto and
incorporated herein by this reference (the "Old Waterworks"); and
3) for the Wastewater Utility, the 14-acre property on which Wastewater Treatment
Plant #1, the Mulberry Plant, is located, more specifically described and shown on Exhibit "E",
attached hereto and incorporated herein by this reference(the"Mulberry Plant");
WHEREAS,the City's Real Estate Services staff has prepared value estimates for WTP#1,
the Old Waterworks and the Mulberry Plant, and, based on a review of the properties and
comparable sales analysis,has estimated the value of WTP #1 to be$603,400, the Old Waterworks
to be$245,000, and the Mulberry Plant to be $805,000; and
WHEREAS, Utilities has been searching for a new location for the Utilities Customer
Information Services office, currently located in rental facilities at 330 South College; and
WHEREAS, with the construction of the new Police Services Building near the intersection
of Timberline Road and Drake Avenue, staff has begun the process of planning for the future use
of current Police Services facilities, including the Police Annex, a .14-acre site near the northeast
comer of LaPorte Avenue and Howes Street, which is more particularly described and shown on
Exhibit "F", attached hereto and incorporated herein by this reference (the "Police Annex"); and
WHEREAS, the City Manager, in consultation with the Utilities General Manager, has
determined that the Police Annex may be a desirable property for use by Utilities for its Customer
Information Services office, the cost of which will be apportioned among each of the Utilities,
pending further review and facilities planning; and
WHEREAS, accordingly, consistent with the tracking of real property assets described
above, the City Manager has proposed the transfer to Utilities of the Police Annex or some other
appropriate real property to be identified as planning and preparation for development of the
Utilities Customer Information Services facilities proceeds; and
WHEREAS,the City's Real Estate Services staff has prepared value estimates for the Police
Annex, and, based on a review of the properties and comparable sales analysis, has estimated the
value of the Police Annex to be $435,000; and
WHEREAS, Section 23 of Article V of the City Charter requires that expenses incurred by
other parts of the City organization in providing services to the City's Utilities be fully paid by the
particular Utility receiving said services; and
WHEREAS,based on the value estimates completed by the City's Real Estate Services staff,
the total value of the properties described herein to be transferred to the Utilities(the"Historic Use
Properties"),as described above,is$2,088,400,and the total value of the properties described herein
to be transferred from the Utilities (the "Surplus Utilities Properties"), as described above, is
$2,075,000; and
WHEREAS, Section 23-111 of the City Code provides that the City Council is authorized
to sell, convey, or otherwise dispose of real property owned by a City Utility, provided the Council
first finds by ordinance that such sale or other disposition will not materially impair the viability of
the affected utility system as a whole and that it will be for the benefit of the citizens of the City will
be for the benefit of the City's citizens and in the best interest of the City of Fort Collins;
WHEREAS, the City Manager and the Utilities General Manager have recommended that
the City Council approve the transfer of the Historic Use Properties to the respective user Utility as
noted above, and the transfer of the Surplus Utilities Properties from the respective user Utility as
noted above; and
WHEREAS, the Financial Officer has determined that the transfer of the Historic Use
Properties to the respective user Utility, and the transfer of the Surplus Utilities Properties from the
respective user Utility are properly accounted for as sales and purchases of the respective properties
as described herein; and
WHEREAS, accordingly, the transfer of the Historic Use Properties would be recorded as
a sale of property in the General Fund totaling $2,088,400 and a corresponding purchase by the
Utilities as follows:
Wastewater Fund—Mulberry Wastewater Treatment Plant#1 $ 805,000
Water Fund—Water Treatment Plant #1 (Gateway) $ 603,400
Water Fund—Old Waterworks $ 245,000
Light & Power Fund— Police Annex $ 220,980
Water Fund— Police Annex $ 120,930
Wastewater Fund—Police Annex $ 47,850
Storm Drainage Fund—Police Annex $ 45,240
Total $2,088,400
WHEREAS, accordingly the transfer of the Surplus Utilities Properties would be recorded
as a sale of property by the Utilities as follows:
Wastewater Fund—Resource Recovery Farm Parcel $2,000,000
Light& Power Fund— Power Plant $ 75,000
Total $2,075,000
and as a purchase of said properties in the General Fund in the amount of$2,075,000; and
WHEREAS, unanticipated revenue in the General Fund from recording the sale of the
Historic Use Properties($2,088,400)to the respective Utilities will be used to fund the appropriation
needed by the General Fund to purchase the Surplus Utilities Properties; and
WHEREAS, appropriations exist within the aforementioned Utility funds to record said
transfer (purchase) of the Historic Use Properties, except for $848,400 in the Water Fund for the
Water Treatment Plant#1 parcel ($603,400) and the Old Water Works parcel ($245,000); and
WHEREAS, funds are available in the Water Fund from prior year reserves, in the amount
of$848,400; and
WHEREAS, as a result of the aforementioned transactions the City's General Fund
recognizes a gain from the exchange of said properties, totaling$13,400; and
WHEREAS, Article V, Section 9, of the Charter of the City of Fort Collins(the"Charter")
permits the City Council to make supplemental appropriations by ordinance at any time during the
fiscal year,provided that the total amount of such supplemental appropriations,in combination with
all previous appropriations for that fiscal year, does not exceed the current estimate of actual and
anticipated revenues to be received during the fiscal year; and
WHEREAS,Article V,Section 10,of the Charter authorizes the City Council to appropriate
by ordinance during the fiscal year such funds for expenditure as may be available from reserves
accumulated in the prior year, notwithstanding that such reserves were not previously appropriated;
and
WHEREAS, staff has determined that the appropriation of unanticipated revenue from the
transfer (sale) of Historic Use Properties as described herein will not cause the total amount
appropriated in the General Fund to exceed the current estimate of actual and anticipated revenues
to be received during the fiscal year.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1. That the Council hereby finds that the transfer of the RRF Parcel and the Old
Power Plant from the Wastewater Utility and the Electric Utility, respectively, as described
hereinabove,will not materially impair the viability of the affected utility system as a whole and that
it will be for the benefit of the citizens of the City will be for the benefit of the City's citizens and
in the best interest of the City of Fort Collins.
Section 2. That the Council hereby transfers,and directs the City Manager and Financial
Officer to account for the transfer of each of the Historic Use Properties to the respective user
Utility,as described above,and hereby transfers,and directs the City Manager and Financial Officer
to account for the transfer of each of the Surplus Utilities Properties from the respective user Utility,
as described above.
Section 3. That there is hereby appropriated for expenditure from unanticipated revenue
in the General Fund, the sum of TWO MILLION SEVENTY-FIVE THOUSAND DOLLARS
($2,075,000) from the transfer(sale)of Historic Use Properties to the Utilities, to be used to record
the transfer(purchase) of Surplus Utilities Properties from the Utilities.
Section 4. That there is hereby appropriated from prior year reserves in the Water Fund,
the sum of EIGHT HUNDRED FORTY-EIGHT THOUSAND FOUR HUNDRED DOLLARS
($848,400)to be used to record the transfer(purchase) of the Water Treatment Plant#1 parcel and
the Old Water Works parcel from the General Fund.
Introduced, considered favorably on first reading, and ordered published this 19th day of
September, A.D. 2006, and to be presented for final passage o 3rd day of October, A. 2006.
Mayo
ATTEST:
tA . I &4-OLI
City Clerk
Passed and adopted on final reading on the 3rd day of October, A.D. 2006.
Mayor
ATTEST:
City Clerk