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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/05/2002 - ITEMS RELATING TO THE 2003 DOWNTOWN DEVELOPMENT AU AGENDA ITEM SUMMARY ITEM NUMBER: 30 A-B DATE: November 5, 2002 FORT COLLINS CITY COUNCIL John F. Fischbach/ STAFF: Alan Krcmarik SUBJECT: Items Relating to the 2003 Downtown Development Authority Budget. RECOMMENDATION: Staff recommends adoption of the Ordinances on First Reading. The Downtown Development Authority Board of Directors recommends adoption of this Ordinance on First Reading, and recommends adoption of a debt service budget for 2003 that has been modified by staff as described in this Ordinance. FINANCIAL IMPACT: This Ordinance sets the Downtown Development Authority annual mill levy at 5.00 mills and appropriates $655,794 in the operating fund for 2003. The mill levy is projected to generate $328,057. The mill levy is being increased from 4.05 mills to 5.00 mills to fund the increase in maintenance and security services needed in the downtown area. The mill levy had been at 4.05 mills from 1991 through 2002. If adopted this Ordinance would appropriate the tax increment revenue for debt service to be paid in 2003. The debt includes DDA revenue bonds, DDA subordinate revenue bonds, the DDA share of the lease purchase certificates of participation for the Civic Center Parking Structure, and monies for projects supported by the Tax Increment Revenues from the expansion of the DDA boundaries. The total tax increment revenue for 2003 is projected to be $2,465,369. The 2003 appropriation in the Downtown Development Authority Debt Service Fund is $1,829,537. EXECUTIVE SUMMARY: A. First Reading of Ordinance No. 163, 2002, Appropriating Operating Funds and Approving the Budget of the Downtown Development Authority for the Fiscal Year Beginning January 1,2003, and Fixing the Mill Levy for the Downtown Development Authority for 2003. The Downtown Development Authority (the "DDA") adopted the proposed DDA budget for 2003, totaling $655,794, and determined the mill levy necessary to provide for payment of all properly authorized expenditures incurred by the DDA, at its regular meeting of October 3, 2002. B. First Reading of Ordinance No. 164, 2002, Appropriating Revenue in the Downtown Development Authority Debt Service Fund for Payment of Debt Service for the Year 2003. This Ordinance appropriates funds for 2003 from the tax increment received by the City for the DDA for debt service payments. Debt service and annual lease payments include: the semi-annual payments of the 2001 DDA Tax Increment Revenue Refunding Bonds in the amount of$1,355,938, the DDA share of the Parking Structure lease payment of$281,987,the amount of$35,112 for the annual interest payment on the subordinate revenue bonds issued in 2000,and$156,500 for various projects identified by the DDA board from tax increment revenues from expanding the DDA boundaries to include the Mulberry/Lemay Crossing Property. DATE: November 5, 2002 2 ITEM NUMBER: 30 A-B BACKGROUND: Through action of the Council and the qualified electors, the City of Fort Collins created the DDA in 1981. According to state statute,the purpose of the DDA is to plan and implement improvements within the boundaries of the DDA district. The DDA established a Plan of Development that specified the types of projects that it would undertake. In order to undertake the plan of improvements. the City on behalf of the DDA has issued various bond anticipation notes and revenue bonds. The first issuance of revenue bonds for the DDA occurred in 1984. Subsequently, the bonds have been refunded to effect savings and to better match the tax increment of the authority with the debt service of the bonds. The first refunding of the bonds occurred in 1992 when the City issued $11,380,000 of Downtown Development Authority Tax Increment Revenue and Refunding Bonds. The most recent refunding of the bonds occurred in 2001. In April of 2001, the City issued $3,640,000 of Downtown Development Authority Tax Increment Revenue and Refunding Bonds. In accordance with the applicable state law, only the City may issue long-term debt on behalf of the DDA. The bond ordinances pledge tax increment revenues of the DDA to debt retirement and establish the debt service payments. The Charter requires that Council appropriate all funds that pass through City accounts. The tax increment from the DDA to be appropriated by the City flows directly into the debt service account. In 2003, the debt service on the 2001 bonds is $1,355,938. In addition to the debt service on the 2001 bonds, the DDA has entered into agreements or passed resolutions that use additional amounts of tax increment. According to an agreement with the City of Fort Collins and Latimer County, the DDA is to pay a share of the annual lease payment on the Civic Center Parking Structure. In 2003, the DDA share of the payment is $281,987. In 2000, the DDA also issued subordinate revenue bonds to participate in the financing of other improvements within the DDA's boundaries. This bond issue has an interest rate that readjusts with the prime rate of Key Bank, the buyer of the bonds. Staff projects an interest rate on the bonds at 6.6%. This interest rate generates an annual interest payment of$35,112. In 2001, the DDA refunded its 1992 Bonds to create debt service savings. The interest rate decreased from about 6.5%to 3.5%. The refunding reduced the DDA debt service payments by$214,000 in 2001, and$5,645 in 2002. It is anticipated that the refunding will reduce debt service payments by $5,103 in 2003. The savings accumulate in the debt service fund and the City and DDA may use them for other projects. The DDA also anticipates that it will participate in additional improvements in the DDA area in 2003. The debt service appropriation Ordinance appropriates$156,500 for expenditure on three projects. The $156,500 will be used as follows: $85,250 for the Mulberry/Lemay intersection,$15,000 for the Poudre River Design Payments, and$56,250 for the Downtown Strategic Plan. In addition to the projects financed using the tax increment from the DDA, the DDA has the ability to impose a mill levy for the administration, operation, and maintenance of the entity. The mill levy for 2003 is being increased to 5.00 mills. The mill levy had been the 4.05 level since 1991. The increase in mill levy is needed to fund the increase in maintenance and security services needed in the downtown area. According to preliminary information from the County Assessor, this mill levy should generate $328,057 of revenue in 2003. The total operating budget for the DDA is $655,794. Staff has attached the corresponding resolutions adopted by the DDA Board of Directors. ORDINANCE NO. 163, 2002 . OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING OPERATING FUNDS AND APPROVING THE BUDGET OF THE DOWNTOWN DEVELOPMENT AUTHORITY FOR THE FISCAL YEAR BEGINNING JANUARY 1, 2003, AND FIXING THE MILL LEVY FOR THE DOWNTOWN DEVELOPMENT AUTHORITY FOR FISCAL YEAR 2003 WHEREAS,the Fort Collins Downtown Development Authority(the"DDA")has been duly organized in accordance with Section 31-25-804, C.R.S.; and WHEREAS, at a special election on March 17, 1981, the registered electors of the DDA voted to authorize the City Council to assess, levy, and collect an ad valorem tax upon the taxable property within the DDA area not to exceed 5.00 mills for the use and benefit of the DDA; and WHEREAS, on October 3,2002, the Board of Directors of the DDA, under the provisions of Section 31-25-816, C.R.S., adopted a budget for the fiscal year beginning January 1, 2003, and determined the mill levy necessary to provide for payment during fiscal year 2003 of all properly authorized expenditures to be incurred by the DDA; and WHEREAS, it is the desire of the Council to approve said budget of the DDA and to appropriate the sum of $655,794 for operation and maintenance of the DDA for the fiscal year • beginning January 1, 2003, and ending December 31, 2003; and WHEREAS,the Board of the DDA has recommended to the Council an increase in the mill levy to 5.00 mills upon each dollar of assessed valuation of all taxable property within the DDA District, such levy representing the amount of taxes for DDA purposes necessary to provide for payment during the ensuing fiscal year for all properly authorized expenditures to be incurred by the DDA; and WHEREAS, an increase in the mill levy is needed to fund the increase in maintenance and security services needed in the downtown area; and WHEREAS,Section 39-5-128(1),C.R.S.,requires certification of any tax levy to the Board of County Commissioners no later than December 15, 2002. NOW, THEREFORE,BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council has reviewed the DDA's 2003 Recommended Budget, as adopted by the Board of Directors of the DDA, and hereby approves said budget, which is on file in the office of the City Clerk. • Section 2.That there is hereby appropriated out of the revenues of the DDA for the fiscal year beginning January 1, 2003 and ending December 31, 2003, the sum of$655,794, to be raised by taxation and otherwise, to be expended for the authorized purposes of the DDA. Section 3. That the 2003 mill levy rate for the taxation upon each dollar of the assessed valuation of all taxable property within the DDA District as of December 31, 2002, shall be 5.00 mills, which levy represents the amount of taxes for the DDA purposes to provide for payment during the aforementioned budget year of all properly authorized expenditures to be incurred by the DDA. Said mill levy shall be certified to the County Assessor and the Board of County Commissioners of Larimer County, Colorado by the City Clerk as provided by law. Introduced, considered favorably on first reading, and ordered published this 5th day of November, A.D. 2002, and to be presented for final passage on the 19th day of November, A.D. 2002. Mayor ATTEST: City Clerk Passed and adopted on final reading this 19th day of November, A.D. 2002. Mayor ATTEST: City Clerk ORDINANCE NO. 164, 2002 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING REVENUE IN THE DOWNTOWN DEVELOPMENT AUTHORITY DEBT SERVICE FUND FOR PAYMENT OF DEBT SERVICE FOR THE YEAR 2003 WHEREAS, the Downtown Development Authority(the "DJDA") is a body corporate duly created, established and authorized to transact business and exercise its powers, all under and pursuant to the Downtown Development Authorities Act of the State of Colorado, Section 31-25- 801, C.R.S. et seq. (the "Act"), and the powers of the authority include the power to borrow money and to finance public improvements within the boundaries of the DDA; and WHEREAS,the Council of the City of Fort Collins,in Ordinance No. 149, 1984,authorized the issuance of Tax Increment Refunded Bonds,Series 1984,dated October 1, 1984,in the aggregate principal amount of$8,200,000;which bonds were subsequently refunded in 1985, 1988, 1992,and 2001; and WHEREAS, through the adoption of Ordinance No. 50, 2001, the City Council authorized the issuance of new Tax Increment Revenue and Refunding Bonds (the "2001 Bonds"), in order to invoke an early call provision on the City's 1992 Downtown Development Authority Tax Increment Revenue Refunding and Improvement Bonds, in the aggregate principal amount of$3,640,000; and . WHEREAS, interest on the 2001 Bonds is due and payable annually; and WHEREAS, the 2003 debt service payment for the 2001 Bonds is $1,355,939; and WHEREAS, the City Council, in Ordinance No. 128, 1998, authorized the issuance by the City of Lease Certificates of Participation Series 1998, dated August 1, 1998, in the aggregate amount of$17,210,000 of which $6,920,000 is attributable to the Parking Structure; and WHEREAS,pursuant to its intergovernmental agreement with the City and the County, the DDA has agreed to pay one-third of the lease payments attributable to the Parking Structure each year through 2006 for the financing of the Civic Center Parking Structure; and WHEREAS, the DDA's share of the 2002 lease payments for the Parking Structure is $281,987; and WHEREAS,the Council of the City of Fort Collins, in Ordinance No. 10, 2000,authorized the issuance of Subordinate Tax Increment Revenue Bonds, Series 2000A dated March 1, 2000, in the aggregate amount of$608,000 for financing several capital improvements in the downtown area (the "2000 Bonds"); and WHEREAS, the DDA's 2003 interest payment for the 2000 Bonds is $35,112; and WHEREAS, in addition, the Board of the DDA is continuing its program to assist and encourage downtown renovation and revitalization, and in furtherance thereof, to provide funding for the acquisition and renovation of facades,construction and installation of public improvement, acquisition of property interests and any other purpose authorized under Section 31-25-801. C.R.S., et seq., through the appropriation of $156,500 in the Downtown Development Authority Debt Service Fund for various projects; and WHEREAS,on October 3,2002,the Board of the DDA adopted a 2003 Budget that provided for the payment of debt service on the 2001 Bonds,2000 Bonds,various projects and lease payments for the Parking Structure, and payment for other projects; and WHEREAS,pursuant to Section 31-25-816,C.R.S.,the DDA budget is subject to approval by the City Council. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated for expenditure from the Downtown Development Authority Debt Service Fund the sum of$1,355,938 for payment of debt service in 2003 on the 2001 Bonds authorized by Council in Ordinance No. 50, 2001. Section 2. That there is hereby appropriated for expenditure from the Downtown Development Authority Debt Service Fund the sum of$281,987,which amount is hereby authorized for transfer to the City of Fort Collins General Fund to be used to cover the Downtown Development Authority's one-third share of the debt service payment on the Civic Center Parking Structure. Section 3. That there is hereby appropriated for expenditure from the Downtown Development Authority Debt Service Fund the sum of$35,112 for interest payment in 2003 on the 2000 Bonds. Section 4. That there is hereby appropriated for expenditure from the Downtown Development Authority Debt Service Fund the sum of$156,500 to be used for the payment of debt to be created by future action of the City Council, in its discretion, for the following projects: Mulberry/Lemay Intersection $85,250 Poudre River Design Payments $15,000 Downtown Strategic Plan $56,250 Introduced and considered favorably on first reading and ordered published this 5th day of . November, A.D. 2002, and to be presented for final passage on the 19th day of November, A.D. 2002. Mayor ATTEST: City Clerk Passed and adopted on final reading this l9th day of November, A.D. 2002. Mayor ATTEST: City Clerk • RESOLUTION 2002-06 OF THE BOARD OF DIRECTORS OF THE FORT COLLINS DOWNTOWN DEVELOPMENT AUTHORITY RECOMMENDING TO THE FORT COLLINS CITY COUNCIL THE APPROPRIATION OF ONE MILLION,EIGHT HUNDRED TWENTY-NINE THOUSAND,FIVE HUNDRED AND THIRTY-SEVEN($1,829,537)DOLLARS IN THE DOWNTOWN DEVELOPMENT AUTHORITY DEBT SERVICE FUND FOR PAYMENT OF DEBT SERVICE FOR THE FISCAL YEAR ENDING DECEMBER 31,2003 WHEREAS, the Fort Collins Downtown Development Authority has been duly organized in accordance with the Colorado Revised Statutes 31-25-804, 1973 as amended;and WHEREAS,pursuant to Ordinance No. 15, 1983,the Council of the City of Fort Collins established a special fund consisting of separate accounts for:(1)operation and maintenance expenses of the Fort Collins Downtown Development Authority;(2)tax increment funds received by the Fort Collins downtown Development Authority;and(3)project funds consisting of proceeds of bonds, loans,and other forms of indebtedness; and WHEREAS,the Council of the City of Fort Collins, in Ordinance No. 50,2001 authorized the issuance of Tax Increment Revenue Refunding Bonds Series 2001, dated April 10,2001, in the aggregate amount of THREE MILLION SIX HUNDRED FORTY THOUSAND DOLLARS ($3,640,000); and • WHEREAS,Section 2 of Ordinance No. 95, 1987 provides that tax increment monies will be pledged to the payment of interest on the Bonds; and WHEREAS,interest on the bonds is due and payable;and WHEREAS,the DDA and the City have entered into certain intergovernmental agreements obligating the payment of tax increment funds for certain capital improvements in the central business district. NOW,THEREFORE,BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE FORT COLLINS DOWNTOWN DEVELOPMENT AUTHORITY as follows: Section 1. That it recommends to the Council of the City of Fort Collins the appropriation for expenditure in 2003 from the Downtown Development Authority Debt Service Fund,the sum of ONE MILLION THREE HUNDRED FIFTY FIVE THOUSAND NINE HUNDRED THIRTY- EIGHT DOLLARS($1,355,938)for payment of debt service for 2003 on the bonds authorized by City Council in Ordinance No. 50,2001. Section 2. That it recommends to the Council of the City of Fort Collins the appropriation forexpenditure in 2003 from the Downtown Development Authority Debt Service Fund,the sum of TWO HUNDRED EIGHTY ONE THOUSAND NINE HUNDRED EIGHTY-SEVEN DOLLARS ($281,987) for payment of debt service for 2003 on the bonds authorized by City Council in Ordinance No. 128, 1998. i Section 3. That it recommends to the Council of the City of Fort Collins the appropriation for expenditure in 2003 from the Downtown Development Authority Debt Service Fund,the sum of THIRTY-FIVE THOUSAND ONE HUNDRED TWELVE DOLLARS ($35,112) for interest payment for 2003 on the bonds authorized by City Council in Ordinance No. 10,2000. Section 4. That it recommends to the Council of the City of Fort Collins the appropriation for expenditure in 2003 from the Downtown Development Authority Debt Service Fund,the sum of FOUR HUNDRED THIRTY EIGHT THOUSAND,FOURHUNDRED AND EIGHTY SEVEN DOLLARS ($438,487)to be used as follows: • Mulber y/LeMay Intersection Repayments $85,250 * River Design Payments $15,000 * Downtown Strategic Plan Repayments $56,250 * Parking Garage Repayment $281,987 Passed and adopted at a regular meeting of the Board of Directors of the Fort Collins Downtown Development Authority this Yd day of October, 2002. Larry yStroud, Chairman J n Meadors, Secretary RESOLUTION 2002-05 OF THE BOARD OF DIRECTORS OF THE FORT COLLINS DOWNTOWN DEVELOPMENT AUTHORITY APPROVING AND RECOMMENDING TO THE FORT COLLINS CITY COUNCIL THE BUDGET OF THE ESTIMATED AMOUNTS REQUIRED TO PAY THE EXPENSES OF CONDUCTING THE BUSINESS OF THE DOWNTOWN DEVELOPMENT AUTHORITY FOR THE FISCAL YEAR ENDING DECEMBER 31,2003 WHEREAS,the Fort Collins Downtown Development Authority has been duly organized in accordance with the Colorado Revised Statutes 31-25-804, 1973 as amended;and, WHEREAS,the Board of Directors of the Downtown Development Authority shall under Colorado Revised Statutes, 31-25-816, 1973 adopt a budget of the estimated revenues and expenditures to be received and incurred during fiscal year ending December 31,2003. NOW,THEREFORE BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE DOWNTOWN DEVELOPMENT AUTHORITY that the following budget is adopted for the fiscal year ending December 31,2003 and therefore recommends to the Council of the City of Fort Collins the adoption of this budget Revenues: Ad Valorem Taxes $328,057 . Auto Specific Ownership Tax 31,827 Interest Earnings 15,000 Licenses and Permits 4,410 Undesignated Reserves 240,000 Contributions 24,000 POTS plaza improvements 12,500 TOTAL $655,794 Expenses: Personal Services $158,184 Contractual Services 88,491 Commodities 2,650 Capital Outlay 300,000 BID Contribution 62,331 Other 44,138 TOTAL $655,794 Passed and adopted at a regular meeting of the Board of Directors of the Fort Collins Downtown Development Authority this 3nd day of October,2002. Larry Stroud,Chairman J M ors, Secretary RESOLUTION 2002-04 OF THE BOARD OF DIRECTORS OF THE FORT COLLINS DOWNTOWN DEVELOPMENT AUTHORITY RECOMMENDING TO THE FORT COLLINS CITY COUNCIL THE DETERNUNING AND FIRING OF THE MILL LEVY OF THE DOWNTOWN DEVELOPMENT AUTHORITY FOR THE FISCAL YEAR ENDING DECEMBER 31,2003 WHEREAS, the Fort Collins Downtown Development Authority has been duly organized in accordance with the Colorado Revised Statutes 31-25-804, 1973 as amended; and, WHEREAS,the Board of Directors of the Downtown Development Authority finds that a mill levy of 5 mills to be sufficient to meet the operational and administrative needs of the Authority for fiscal year 2003. NOW,THEREFORE,BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE DOWNTOWN DEVELOPMENT AUTHORITY OF THE CITY OF FORT COLLINS,to recommend to the Council of the City of Fort Collins the mill levy rate for taxation upon all the taxable property within the Downtown Development Authority District for the fiscal year ending December 31,2003 be set at 5 mills which is sufficient to raise ad valorem revenues for the 2003 Operations and Maintenance Budget as approved by the Downtown Development Authority which levy represents the amount of taxes for the Downtown Development Authority(however,said mill levy is subject to change based on the assessor's calculations which have not been published at this time). Said mill levy shall be distributed to general expense, which levy as so distributed shall be certified by the County Assessor and the Board of the County Commissioners of Larimer County,Colorado by the City Clerk as provided by law. Passed and adopted at a regular meeting of the Board of Directors of the Fort Collins Downtown Development Authority this P day of October,2002. Larry Stroud,Chairman A ST: n Meadors, secretary