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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 02/04/2014 - CONSIDERATION AND APPROVAL OF THE MINUTES OF THE JAgenda Item 1 Item # 1 Page 1 AGENDA ITEM SUMMARY February 4, 2014 City Council STAFF Wanda Nelson, City Clerk SUBJECT Consideration and Approval of the Minutes of the January 7, 2014 Regular Council Meeting and the January 14, 2014 Adjourned Council Meeting. EXECUTIVE SUMMARY The purpose of this item is to approve the minutes from the January 7, 2014 Regular Council Meeting and the January 14, 2014 Adjourned Council Meeting. ATTACHMENTS 1. January 7, 2014 (PDF) 2. January 14, 2014 (PDF) January 7, 2014 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, January 7, 2014, 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: Campana, Cunniff, Horak, Overbeck, Poppaw, Troxell and Weitkunat. Staff Members Present: Atteberry, Nelson, Roy. Agenda Review City Manager Atteberry stated Item No. 12, First Reading of Ordinance No. 004, 2014, Authorizing the Execution of a New Intergovernmental Agreement Pertaining to a Regional Road Impact Fee Program, Adopting a Regional Road Impact Fee Schedule, Ratifying Fee Changes and Collections Made in the Past, and Amending Section 7.5-85(d) of the City Code Pertaining to the Remittance to the County of the Collected Fees, will be removed from the agenda to allow staff additional time to gather information. Citizen Participation Mike Devereaux, Commission on Disabilities, 3344 Hickock Drive, discussed the lack of access to bus stops due to a lack of snow removal. Cheryl Distaso, Fort Collins Community Action Network, spoke in support of Mr. Devereaux’s snow removal concerns and expressed concern regarding the press release for the Police Services community meeting concerning body-worn cameras. She stated the standard operating procedures for body-worn cameras should be referenced in the press release and should be easier to locate on the City’s web page. Eric Sutherland, 3520 Golden Currant, discussed Item No. 12, First Reading of Ordinance No. 004, 2014, Authorizing the Execution of a New Intergovernmental Agreement Pertaining to a Regional Road Impact Fee Program, Adopting a Regional Road Impact Fee Schedule, Ratifying Fee Changes and Collections Made in the Past, and Amending Section 7.5-85(d) of the City Code Pertaining to the Remittance to the County of the Collected Fees, stating there is a disparity in the distribution of taxpayer dollars in Larimer County. Mel Hilgenberg, 172 North College, discussed community theater events and stated the shuttle bus which ran during First Night needed improvement. He requested the replacement of the solar recycling and trash container at Walnut and College. He suggested the City work with the Fort Collins Rescue Mission to exchange property at the old night club across from New January 7, 2014 475 Belgium with the existing Mission building, which should house a parking structure. Mike Pruznick, Fort Collins resident, opposed the City’s economic development process related to larger, more complicated projects. Vanessa Fenley, Homeward 2020 Director, announced the annual Point in Time count which will be used to identify population-specific housing needs for Fort Collins’ homeless population. Jack Daniels, 172 North College, stated Fort Collins is a wonderful place to live. Citizen Participation Follow-up Mayor Weitkunat requested information regarding Mr. Devereaux’s concerns. City Manager Atteberry replied a service area request response will be forthcoming and asked Karen Cumbo, Planning, Development, and Transportation Director, to provide additional context. Cumbo noted the City contracts out sidewalk clearing, which should have been completed in far less than the week mentioned by Mr. Devereaux. She apologized on behalf of the City. Mayor Pro Tem Horak stated the sidewalk on the west side of North College Avenue from Cherry Street north remains packed with snow. He asked about the City’s standards for sidewalk snow removal. Cumbo replied that is a reminder to the City that it needs to be more consistent with its snow removal compliance on sidewalks. Councilmember Cunniff stated the City’s sidewalks need to be given equal priority to the City’s trails and streets. City Manager Atteberry agreed resources need to be provided if necessary to further prioritize sidewalk snow removal. Councilmember Troxell thanked Cumbo for her report and efforts to improve the situation. He suggested input be gathered from affected individuals, such as those in wheelchairs who have been negatively affected by a lack of snow removal. Mayor Weitkunat stated this was an important discussion to hold and requested that residents be vigilant in making the City aware of issues. Councilmember Overbeck requested information regarding the Police Services body-worn cameras. John Hutto, Police Chief, replied the web page has a Frequently Asked Questions section and noted several meetings have been held and will be held regarding the issue. Councilmember Overbeck requested the creation of a balance between privacy and surveillance. Mayor Pro Tem Horak noted he mentioned to staff Ms. Distaso’s request to link the standard operating procedures to the press release. Hutto replied a second press release could be released and added the standard operating procedures link is on the same page as is the press release link. He noted the purpose of the meeting to be held at the end of the month is to engage in a community dialogue. January 7, 2014 476 CONSENT CALENDAR 1. Consideration and Approval of the Minutes of the December 17, 2013 Regular Council Meeting. The purpose of this item is to approve the minutes from the December 17, 2013 Regular Council meeting. 2. Second Reading of Ordinance No. 179, 2013, Amending the City Code to Increase the Amounts of the Capital Improvement Expansion Fees Contained in Chapter 7.5 of the Code so as to Reflect Inflation in Associated Costs of Services. This Ordinance, unanimously adopted on First Reading on December 17, 2013, updates the City Code, which requires an annual adjustment to certain building permit related fees. Capital Improvement Expansion fees and Neighborhood Parkland fees are to reflect the changes in the Denver-Boulder-Greeley Consumer Price Index (CPI). Street Oversizing fees are adjusted by the changes posted in the Engineering News Record (ENR). The CPI has increased 2.8% since its last adjustment and the ENR has not increased. 3. Second Reading of Ordinance No. 180, 2013, Amending Section 2-30 of the City Code Pertaining to the City Council Meeting Agenda. This Ordinance, unanimously adopted on First Reading on December 17, 2013, deletes a City Code provision requiring that the title of any ordinance placed on the consent calendar be read prior to action by the Council on the consent calendar. 4. Second Reading of Ordinance No. 181, 2013, Declaring Certain City-Owned Property as Road Right of Way. This Ordinance, unanimously adopted on First Reading on December 17, 2013, declares parcels of City-owned property located at the southwest corner of Timberline Road and Prospect Road that is currently used and planned to be used in the future as Timberline Road, as public road right-of-way. 5. Second Reading of Ordinance No. 182, 2013, Authorizing the Acquisition by Eminent Domain Proceedings of Certain Land Necessary to Construct Public Improvements Related to the Mason Corridor Bus Rapid Transit Project. This Ordinance, unanimously adopted on First Reading on December 17, 2013, authorizes the use eminent domain, if necessary, to acquire an additional utility easement which is needed for the MAX Bus Rapid Transit Project (MAX). As a federally funded transportation project, this acquisition will conform to the provisions of the Uniform Relocation Assistance and Real Property Acquisitions Policies Act of 1970, as amended (Public Law 91-646). In accordance with this act, property owners must be informed about the possible use of eminent domain and their rights pursuant to the act though an official January 7, 2014 477 Notice of Interest Letter. Authorization from City Council is needed prior to sending this information to property owners. Staff requests authorization to utilize eminent domain for the MAX Project, if necessary, and only if good faith negotiations break down. 6. Items Relating to the Mail Creek Crossing Annexation and Zoning. A. Second Reading of Ordinance No. 183, 2013, Annexing Property Known as the Mail Creek Crossing Annexation to the City of Fort Collins. B. Second Reading of Ordinance No. 184, 2013, Amending the Zoning Map of the City of Fort Collins and Classifying for Zoning Purposes the Property Included in the Mail Creek Crossing Annexation to the City of Fort Collins. These Ordinances, unanimously adopted on December 17, 2013, annex and zone 39.608 acres located on the north side of Zephyr Road, approximately 1,450 feet east of South Timberline Road (just east of Bacon Elementary). The proposed zoning for this annexation is LMN - Low Density Mixed Use Neighborhood. 7. Second Reading of Ordinance No. 185, 2013, Authorizing the Release of Restrictive Covenants on Property at 405 Linden Street Owned by the Fort Collins Housing Authority. This Ordinance, unanimously adopted on First Reading on December 17, 2013, authorizes the release of the Agreement of Restrictive Covenants Affecting Real Property for the property located at 405 Linden Street, currently owned by the Fort Collins Housing Authority. 8. Second Reading of Ordinance No. 186, 2013, Amending Ordinance No. 158, 2013, to Phase In the Effective Date of the Regulations Adopted by Ordinance No. 158, 2013, for Outdoor Service Areas That Are Not Located Within or Adjacent to Public Sidewalks or Other Public Rights-of-Way. This Ordinance, unanimously adopted on First Reading on December 17, 2013, amends the effective date of the new City Code provisions that expanded the application of the smoking ordinance to outdoor serving areas. The Ordinance establishes a “phase-in” or delayed implementation date for outdoor service areas that are not within or adjacent to sidewalks or other public rights-of-way, in an effort to limit the negative impact of Ordinance No. 158, 2013, on affected businesses. 9. First Reading of Ordinance No. 001, 2014, Appropriating Unanticipated Grant Revenue in the General Fund for the Gardens on Spring Creek. The purpose of this item is to appropriate a total of $76,000 in grant funding received by the Gardens on Spring Creek. January 7, 2014 478 10. First Reading of Ordinance No. 002, 2014, Appropriating Unanticipated Revenue for the Senior Center Expansion Project and Transferring Appropriations to the Cultural Services and Facilities Fund for the Art in Public Places Program. The purpose of this item is to appropriate $400,000 to the Senior Center Expansion Project. The additional funding is money raised by the Senior Center Expansion Committee. These funds will be used to provide improvements to the expansion project for items requested by facility staff and users; including completion of the Multi-purpose room as an education center. 11. First Reading of Ordinance No. 003, 2014, Amending Section 1-15 of the City Code Relating to General Penalties. The purpose of this item is to adjust the maximum fines Municipal Court may impose so they are consistent with state law. 12. First Reading of Ordinance No. 004, 2014, Authorizing the Execution of a New Intergovernmental Agreement Pertaining to a Regional Road Impact Fee Program, Adopting a Regional Road Impact Fee Schedule, Ratifying Fee Changes and Collections Made in the Past, and Amending Section 7.5-85(d) of the City Code Pertaining to the Remittance to the County of the Collected Fees. The purpose of this item is to execute a new Intergovernmental Agreement (IGA) with Larimer County that allows for the collection of a Regional Road Fee at the time of development. The Ordinance adopts a fee schedule and ratifies past fee changes and collections and also amends Section 7.5-85(d) of the City Code pertaining to the remittance of the fee. 13. Items Relating to the Kechter Farm Annexation and Zoning. A. Resolution 2014-001 Setting Forth Findings of Fact and Determinations Regarding the Kechter Farm Crossing Annexation. B. Hearing and First Reading of Ordinance No. 005, 2014, Annexing Property Known as the Kechter Farm Annexation to the City of Fort Collins. C. Hearing and First Reading of Ordinance No. 006, 2014, Amending the Zoning Map of the City of Fort Collins and Classifying for Zoning Purposes the Property Included in the Kechter Farm Annexation to the City of Fort Collins. January 7, 2014 479 This is a request to annex and zone 88.21 acres located north of Fossil Creek Reservoir, approximately 1,320 feet south of Kechter Road, 2,640 feet east of South Timberline Road, just west of Ziegler Road, and southwest of Kinard Middle School. The property is located within the Fossil Creek Reservoir Area Plan. In accordance with the Intergovernmental Agreement with Larimer County, adopted in 1999, properties within the Fossil Creek Reservoir Area receive their land use approvals in the County and are annexed into the City prior to construction. Kechter Farm has a General Development Plan (comparable to the City’s Overall Development Plan) that encompasses 286 acres. The first phase of the project is 88.21 acres and is currently in the County’s development review process. Within the first phase, there is a 2.85 acre commercial area, 1.45 acre recreation center with a neighborhood park, and the remaining land is dedicated to residential development. The requested zoning for this annexation is LMN - Low Density Mixed Use Neighborhood and UE - Urban Estate. This annexation request is in conformance with the State of Colorado Revised Statutes as they relate to annexations, the City of Fort Collins Comprehensive Plan, and the Larimer County and City of Fort Collins Intergovernmental Agreements. The annexation of this property will create an enclave, which will affect approximately 180 acres of land to the north and west of the subject annexation. 14. First Reading of Ordinance No. 007, 2014, Authorizing the Lease of a Portion of City- Owned Property at 225 Maple Street to Feeding Our Community Ourselves, Inc. For Up to Five Years. The purpose of this item is to lease 4,446 square feet of City-owned property to a non-profit cafe. Feeding Our Community Ourselves, Inc. ("FoCo") wishes to lease a portion of 225 Maple Street to house a non-profit café with a minimal food processing facility. The total yearly lease payment for the property will be at least $16,900. The term of the lease shall be for five years. With this lease, FoCo will have the option to terminate at any time upon a 90-day advanced written notice to the City. FoCo will be responsible for its remodel, taxes, all utilities, communication services, trash services and janitorial services. 15. Resolution 2014-002 Making Appointments to the Energy Board. The purpose of this item is to correct an omission that occurred in Resolution 2013-107 that made annual appointments to various boards, commissions, and authorities. Two appointments to the Energy Board were not included in that Resolution. Councilmembers Gino Campana and Ross Cunniff recommend the appointment of Philip Friedman and Michael Doss to the Energy Board. ***END CONSENT*** January 7, 2014 480 Eric Sutherland, 3520 Golden Currant, withdrew Item No. 11, First Reading of Ordinance No. 003, 2014, Amending Section 1-15 of the City Code Relating to General Penalties from the Consent Calendar. Michael Czaja, 204 Maple Steet, withdrew Item No. 14, First Reading of Ordinance No. 007, 2014, Authorizing the Lease of a Portion of City-Owned Property at 225 Maple Street to Feeding Our Community Ourselves, Inc. For Up to Five Years from the Consent Calendar. Mayor Pro Tem Horak made a motion, seconded by Councilmember Troxell, to adopt and approve all items not withdrawn from the Consent Calendar. Yeas: Troxell, Horak, Weitkunat, Campana, Poppaw, Cunniff and Overbeck. Nays: none. THE MOTION CARRIED. Staff Reports Beth Sowder, Neighborhood Services Manager, introduced Emily Allen, Community Liaison. She stated the position is funded by both the City and Colorado State University and illustrates the dedication to the partnership. Allen discussed the Neighborhood Outreach Program which welcomes new tenants to neighborhoods and reminds them of community expectations. She also discussed Community Welcome which occurs at the beginning of each school year, the Fall Clean Up program in which students aid elderly and physically-limited residents with fall leaf clean up, and the City’s Party Registration program which allows for one warning to be issued for noise violations prior to receiving citations. Councilmember Troxell thanked Allen for her report and noted this program has been recognized by the National League of Cities. Mayor Pro Tem Horak commended Sowder and Allen’s work. Councilmember Reports Mayor Pro Tem Horak commended the group of private citizens who have raised funds toward the Senior Center expansion. He stated Platte River Power Authority’s strategic plan is now available and stated an I-25 coalition is examining possible funding of an additional traffic lane on I-25 from Highway 66 to Highway 14. He stated he will be attending the MPAC 64 meeting regarding solutions to transportation funding. Mayor Weitkunat reported on Council’s legislative breakfast on December 22nd. Councilmember Troxell went into further detail regarding the meeting and the City’s legislative agenda. January 7, 2014 481 Council Consideration of Text Amendment to the Community Commercial-Poudre River Zone District (C-C-R), Motion to approve staff recommendation that no amendment to the Land Use Code Be Made, Adopted The following is the staff memorandum for this item. “EXECUTIVE SUMMARY The purpose of this item is to comply with Land Use Code (LUC) requirements that direct the Planning Director to submit any additions to the list of permitted uses to Council for consideration as a text amendment. If the Council disagrees with the staff recommendation, it should adopt a motion directing staff to prepare and present an ordinance to Council to amend the Land Use Code. STAFF RECOMMENDATION Staff recommends that no amendment to the LUC be made in conjunction with this added use for the following reasons: The main purpose of the District is to foster a healthy and compatible relationship between the River, the Downtown and surrounding urban uses. Any significant redevelopment shall be designed as part of a master plan for the applicable group of contiguous properties. The Link- N-Greens site was large enough to be able to foster a healthy and compatible relationship between the River, Downtown and surrounding urban uses however there are only three other areas currently zoned C-C-R all of which are significantly smaller than the “Link-N-Greens” site and therefore not likely suitable for a Campus Employment use with at least 30 acres. The largest of the remaining parcels is 23.5 acres. BACKGROUND / DISCUSSION On September 4, 2012, in accordance with the authority pursuant to Section 1.3.4(A) of the Fort Collins Land Use Code (LUC) and in conjunction with the application filed by NewMark Merrill Mountain States for approval of an overall development plan for the site (101.637 acres in size) located at the southwest corner of the intersection of Lincoln and Lemay Avenues, commonly known as “Link-N-Greens,” the following use was added to the Community Commercial-Poudre River Zone District (C-C-R): Campus employment shall mean a use that combines and permits two (2) or more of the following uses: office, light industrial, heavy industrial, commercial or retail in a unified master planned development site containing at least thirty (30) acres. The criteria contained in Section 1.3.4(A)(1) through (5) of the Land Use Code was followed and a determination made that this use conforms to all of the following conditions: January 7, 2014 482 In adding this use, I have examined the criteria contained in Section 1.3.4(A)(1) through (5) of the Land Use Code and have determined that this use conforms to all of the following conditions: (1) Such use is appropriate in the zone district to which it is added; (2) Such use conforms to the basic characteristics of the zone district and the other permitted uses in the zone district to which it is added; (3) Such use does not create any more offensive noise, vibration, dust, heat, smoke, odor, glare or other objectionable influences or any more traffic hazards, traffic generation or attraction, adverse environmental impacts, adverse impacts on public or quasi-public facilities, utilities or services, adverse effect on public health, safety, morals or aesthetics, or other adverse impacts of development, than the amount normally resulting from the other permitted uses listed in the zone district to which it is added; (4) Such use is compatible with the other listed permitted uses in the zone district to which it is added; (5) Such use is not a medical marijuana dispensary or a medical marijuana cultivation facility; Whenever any use has been added by the Director to the list of permitted uses in any zone district in accordance with subsection (A) above, such use shall be considered for an amendment to the text of the LUC under Division 2.9 (B).” Laurie Kadrich, Director of Community Development and Neighborhood Services, stated this item, if adopted, would show Council’s support of excluding a new use, Campus Employment, in the Community Commercial-Poudre River Zone District. Kadrich discussed the evolution of this item and its necessity as a “clean-up” item. Councilmember Campana noted the “addition of a permitted use” is not extremely rare. Kadrich discussed the approval processes for this technique and agreed with Councilmember Campana’s assertion that this is a typical process within the Planning and Zoning Board. Councilmember Cunniff made a motion, seconded by Councilmember Campana, to limit the Campus Employment use to the Woodward development plans as recommended by the Planning Director and Planning and Zoning Board and not add the use to the list of permitted uses in the CCR Zone District. Yeas: Horak, Weitkunat, Campana, Poppaw, Cunniff, Overbeck and Troxell. Nays: none. THE MOTION CARRIED. January 7, 2014 483 Resolution 2014-003 Making an Appointment to the Downtown Development Authority of the City of Fort Collins, Adopted The following is the staff memorandum for this item. “EXECUTIVE SUMMARY The purpose of this item is to address the vacancy that exists on the Downtown Development Authority (DDA). BACKGROUND / DISCUSSION By adopting Resolution 2013-107, Council filled two of the three vacancies on the DDA. At the December 17 Regular Council Meeting, staff was directed to bring options forward for the remaining vacancy. Option 1: Adoption of Resolution 2014-003 with the member's name inserted will fill the remaining vacancy. or Option 2: Direct staff to recruit for the remaining vacancy.” Councilmember Cunniff made a motion, seconded by Councilmember Overbeck, for Lee Swanson to fill the DDA vacancy. Councilmember Cunniff stated he had originally wanted to re-advertise for this vacancy in order to find a candidate who would advocate more for some of the sensitivity toward the development near the River. The vote on the motion was as follows: Yeas: Weitkunat, Campana, Poppaw, Cunniff, Overbeck, Troxell and Horak. Nays: none. THE MOTION CARRIED. Ordinance No. 003, 2014, Amending Section 1-15 of the City Code Relating to General Penalties, Adopted on First Reading The following is the staff memorandum for this item. “EXECUTIVE SUMMARY January 7, 2014 484 The purpose of this item is to adjust the maximum fines Municipal Court may impose so they are consistent with state law. BACKGROUND / DISCUSSION The General Assembly amended Section 13-10-113, C.R.S., authorizing municipal courts of record to impose a fine of up to $2,650 or imprisonment of up to one year, or both, upon persons convicted of a municipal ordinance or code offense, with the court fines to be adjusted for inflation on January 1, 2014, and on January 1 of each year thereafter. FINANCIAL / ECONOMIC IMPACTS his increase, allowed by state law, will afford the municipal court judges more discretion in the tailoring of penalties for more serious offenses. This Ordinance increases the maximum fine amount that may be charged by a municipality. It is unknown whether it will increase revenues for the city.” Eric Sutherland, 3520 Golden Currant, opposed the placement of this item on the Consent Calendar and stated the Agenda Item Summary contained misinformation and lacked validation that this move is necessary or that the existing fines are not appropriate. Mayor Pro Tem Horak made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 003, 2014, on First Reading. Councilmember Cunniff requested statistics relating to the trends and history of the fines prior to Second Reading. City Attorney Roy replied he would work with Judge Lane to compile the information. Mayor Pro Tem Horak stated the fine amount has not been increased in 23 years and supported the item. The vote on the motion was as follows: Yeas: Campana, Poppaw, Cunniff, Overbeck, Troxell, Horak and Weitkunat. Nays: none. THE MOTION CARRIED. Ordinance No. 007, 2014, Authorizing the Lease of a Portion of City-Owned Property at 225 Maple Street to Feeding Our Community Ourselves, Inc. For Up to Five Years, Adopted on First Reading The following is the staff memorandum for this item. “EXECUTIVE SUMMARY The purpose of this item is to lease 4,446 square feet of City-owned property to a non-profit cafe. January 7, 2014 485 Feeding Our Community Ourselves, Inc. ("FoCo") wishes to lease a portion of 225 Maple Street to house a non-profit café with a minimal food processing facility. The total yearly lease payment for the property will be at least $16,900. The term of the lease shall be for five years. With this lease, FoCo will have the option to terminate at any time upon a 90-day advanced written notice to the City. FoCo will be responsible for its remodel, taxes, all utilities, communication services, trash services and janitorial services. BACKGROUND / DISCUSSION The City purchased Lots 22 through 28, Block 32, also known as 225 Maple Street, from Haiston Oil Company (“Haiston”), in December 2008 to allow for future City development. This site has not been leased since the purchase; however, the garage units on the property have been used for storage by various City departments. Feeding Our Community Ourselves, Inc. (“FoCo”) is a non-profit organization that plans to operate a café open to the general public and also provide meals to people, regardless of their ability to pay, while using local, organic, and sustainably-grown ingredients. FoCo hours of operation will be 11:00 a.m. through 2:00 p.m. Mondays through Saturdays. FoCo is a 100% volunteer operated organization. In addition, the site will minimally process local fresh produce to increase its availability to low-income citizens. The Lease Premises at 225 Maple Street consist of 2,023 square foot building (975 SF main level and 1,048 SF basement) that will house the café. FoCo plans to remodel the main level of the building to include customer seating/dining area, a kitchen with a food preparation area, and upgraded improvements to the restrooms. The basement will be used for dry storage and FoCo office space. A new handicap accessible ramp will be installed on the west side of the building located next to the platform. Bike racks will be installed on site, although their location has not yet been determined. Weather permitting, outdoor seating/dining will be available on the gravel area between the main building (café) and the garage units. FoCo will also lease the easternmost garage unit, which is 525 square feet in size, and use it for general storage, housing of refrigeration/freezer units and a “growing wall”. The 110 square foot outbuilding that was added to the main building prior to the City purchasing the site will be used to hold refrigeration and freezer units. FoCo will install a full trash enclosure to the south of the main building, adjacent to the alley for trash service accessibility. FoCo will pay all costs of the remodel. FINANCIAL / ECONOMIC IMPACT Annual rent collected from this lease will result in at least $16,900 in unanticipated revenue. Rent for this space is based on comparative market rents for industrial space and cold storage buildings. FoCo will be responsible for expenses of all utilities, communication services, trash services, janitorial services, and taxes. In addition, it will be the obligation of FoCo for any tenant finish costs. The City will be responsible for maintenance costs to the building.” January 7, 2014 486 Michael Czaja, 204 Maple Street, commended the City on working with FoCo but expressed concern regarding the fact citizens only became aware of this potential arrangement through a Coloradoan article. He asked if the decision to place the Café in this location was made because it was suitable to meet the objectives of the organization, or because it was an opportunity to rent an unused City facility. He asked about the proposed size of the Café and the anticipated number of customers. Jean Schorsch, 204 Maple Street, opposed the location of the FoCo project due to safety concerns in her neighborhood; she supported the idea of the project. Jim Costner, office space holder at 204 Maple Street, stated he is not opposed to the FoCo Café and will likely financially support the Café; however, he expressed concern regarding the proposed location. Dave Durbiss, 618 Wabash Street, asked if this use will require a change of use for the property and if the site will be required to undergo improvements. Eric Sutherland, 3520 Golden Currant, supported the item and questioned the City’s lack of support for “social entrepreneurship.” Jeff Baumgardner, co-founder of the FoCo Café, stated he would welcome any community input and would like to ensure any safety concerns are addressed. He added the location is optimal for the Café as it is close to the individuals of greatest need who have difficulty walking great distances and is close to others in the downtown area who may opt to purchase a meal. Cindy Roberts, FoCo Café Boardmember, stated the true measure of community is how we take care of all of the members of the community. She stated crime is not increased in areas around these types of cafes and questioned whether or not there are increased crime statistics related to homeless individuals. She stated the Maple Street location is ideal and noted the FoCo Café hopes to address neighbors’ concerns. Ken Smith, Martinez Park Homeowners Association President and FoCo Café Boardmember, stated this Café will be a restaurant and detailed the concept behind the Café. He stated the space will have about 30 seats and will only be open at lunch. He expressed support for the Café as a neighbor, homeowner, president of the HOA, and restaurateur. Councilmember Poppaw requested additional information regarding the overall concept, noting it is not a new idea. Mr. Baumgardner replied there are approximately 24 community cafes open in America. He stated the café offers the opportunity for anyone in the community to go to a common location and have a common meal experience in a dignified manner. Councilmember Troxell requested information regarding community engagement thus far. Mr. Baumgardner replied he and his wife have been discussing this idea with community members since June 2012. He stated he has held hundreds of meetings with community members and organizations which are the financial engine driving the Café forward. January 7, 2014 487 Mayor Weitkunat requested staff response to the zoning and use questions. Ken Mannon, Operations Services Director, replied the Baumgardners have gone through the City process and the use is an approved use in the zone district, though it will require a minor amendment which means the facility will need to be brought up to some new standards. Helen Matson, Real Estate Services Manager, added the lease agreement requires that all tenant alterations follow all laws, ordinances, and rules of the City or other governing agencies. Mayor Weitkunat asked Matson to address the questions posed by the speakers. Matson replied this project was originally recommended for 212 Laporte Avenue; however, the redevelopment of that block will eliminate that building. After looking at several sites and the available lease terms for each, the new proposed site was selected. Matson stated the restaurant itself will be on the first floor, which has 975 square feet, and will hold about 30 seats. There are plans to have some outdoor seating additionally. Mannon stated the question about DDA involvement cannot yet be answered. Councilmember Overbeck asked if the Café will be required to apply for a restaurant license. Matson replied they will need to follow all applicable laws, including those of the County Health Department. Councilmember Troxell made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 007, 2014, on First Reading. Councilmember Cunniff stated he is encouraged about the development of this project and noted the item was originally on the Consent Calendar as it was not viewed as controversial; however, he stated important conversations have occurred as a result of the discussion. Councilmember Campana noted the City’s involvement to this point is limited to the lease of a City-owned property; therefore, notice would not have been provided to citizens. He stated notice will be provided as part of the minor amendment process. Councilmember Poppaw asked if notice is typically given when a restaurant opens. Matson replied any type of land use change, through either the minor amendment or major amendment process requires citizen notification; however, there is no notification process when the City plans to lease a building. Councilmember Overbeck commended the FoCo Café and the willingness of the Baumgardner’s to have a conversation with the neighbors. Mayor Pro Tem Horak stated he is enthusiastic about the project, but not about acting on the lease this evening. He stated some type of neighborhood outreach should have occurred, even though it is not required, given the fact that most City properties are not expected to be restaurants. He suggested postponement of the item to allow time for a neighborhood meeting and discussions. January 7, 2014 488 Mayor Weitkunat stated this item is a lease for a City property and is not specifically related to use; neighborhood involvement will be triggered through the planning process. Councilmember Campana stated the way in which the dialogue took place was a bit awkward; however, this item only allows the lease of the property which needs to be in place prior to the planning process. He suggested Council require a neighborhood meeting in association with the minor amendment process. Mayor Weitkunat commended the project and stated it speaks to the Fort Collins idea of community. Councilmembers Troxell and Poppaw agreed to accept the condition of a neighborhood meeting. Councilmember Poppaw supported the project and neighborhood outreach. Mayor Pro Tem Horak asked if minor amendment decisions can be appealed. City Attorney Roy replied he would return with that information. Mayor Pro Tem Horak expressed concern the minor amendment decision could be appealed to Council, which has already approved the lease without looking at any potential mitigation, and the fact that the agenda item did not point out a number of other things that needed to occur for this process. Mayor Pro Tem Horak opposed moving forward with the item suggesting the Director will not push the minor amendment decision to the Planning and Zoning Board after Council has already supported the project. Mayor Pro Tem Horak made a motion to postpone the item until such time as the planning process is complete. THE MOTION FAILED DUE TO LACK OF A SECOND. Councilmember Cunniff stated the planning process cannot move forward until the lease is produced. He stated planning staff should not take Council’s enthusiasm regarding the project as being more important than City Code regulations. Mayor Pro Tem Horak noted the discussion has not revolved around the lease, but rather the project. He asked if the lease is required for the project to move forward and if the lease will be signed prior to the planning process moving forward. Matson replied the lease will be signed as the planning process required permission of the property owner; however, if approval for the project is not granted, the Café has the option to terminate the lease. January 7, 2014 489 The vote on the motion was as follows: Yeas: Poppaw, Cunniff, Overbeck, Troxell, Weitkunat and Campana. Nays: Horak. THE MOTION CARRIED. Executive Session Authorized Mayor Pro Tem Horak made a motion, seconded by Councilmember Troxell, to go into Executive Session for the purpose of meeting with the City Attorney, City Manager, and other affected members of City Staff to discuss potential litigation and related legal issues as permitted under Section 2-31(a)(2) of the City Code. Yeas: Cunniff, Overbeck, Troxell, Horak, Weitkunat, Campana and Poppaw. Nays: none. THE MOTION CARRIED. (Council adjourned into executive session and returned at 9:18 p.m.) Adjournment Councilmember Overbeck made a motion, seconded by Councilmember Cunniff, to adjourn to Tuesday, January 14, 2014, at 6:00 p.m. so that the Council may consider various items related to the redevelopment of the Foothills Mall, as well as any additional business that may come before the Council. Yeas: Cunniff, Overbeck, Campana, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. (Secretary’s note: Mayor Weitkunat was not present for the vote on the motion to adjourn.) The meeting adjourned at 9:19 p.m. _________________________________ Mayor ATTEST: _____________________________ City Clerk January 14, 2014 COUNCIL OF THE CITY OF FORT COLLINS, COLORADO Council-Manager Form of Government Adjourned Meeting – 6:00 p.m. An adjourned meeting of the Council of the City of Fort Collins was held on Tuesday, January 14, 2014, 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: Campana, Cunniff, Horak, Overbeck, Poppaw and Troxell. Councilmembers Absent: Weitkunat Staff Members Present: Atteberry, Nelson, Roy. Items Relating to the Redevelopment of the Foothills Mall The following is the staff memorandum for this item. “EXECUTIVE SUMMARY A. Resolution 2014-004 Approving an Updated Redevelopment and Reimbursement Agreement with the Fort Collins Urban Renewal Authority, Walton Foothills Holdings VI, L.L.C. and the Foothills Metropolitan District Regarding the Redevelopment of Foothills Mall. B. Resolution 2014-005 Updating Prior Action Regarding the Redevelopment of Foothills Mall and Regarding Cooperation and Partnership with Larimer County on Economic Revitalization Efforts and the Use of Tax Increment Financing. C. First Reading of Ordinance No. 008, 2014, Vacating Foothills Parkway Right-of-Way Between College Avenue and Mathews Street, and Vacating a Portion of Mathews Street. D. First Reading of Ordinance No. 009, 2014, Authorizing the Conveyance of a Permanent Irrigation Ditch Easement and Right-of-Way to the Larimer County Canal No. 2 Irrigating Company Within the South College Avenue Frontage Road. The purpose of this item is to authorize and approve several items relating to the redevelopment of Foothills Mall. Resolution 2014-004 authorizes and approves the execution of a Reimbursement and Redevelopment Agreement to support the redevelopment of Foothills Mall. The Agreement was made available for public review on Friday, January 3. Revisions to the Agreement since that time include the addition of a new Subsection 12.3(g), related to Arc Thrift Store, as well as clarification of the minimum Mall square footage. January 14, 2014 427 Resolution 2014-005 approves a time extension for developing a financial model with Larimer County for evaluating fiscal impacts associated with the formation of tax increment financing districts. Ordinance No. 008, 2014 vacates the right-of-way for the remaining public street portion of Foothills Parkway from College Avenue to Mathews Street, along with a portion of the west side of Mathews Street intersecting Foothills Parkway. Ordinance No. 009, 2014, authorizes the conveyance of a permanent irrigation ditch easement and right-of-way to accommodate the realignment of the Larimer No. 2 Ditch, which allows the ditch to be relocated off the Mall property. BACKGROUND / DISCUSSION A. Resolution 2014-004 Approving an Updated Redevelopment and Reimbursement Agreement with the Fort Collins Urban Renewal Authority, Walton Foothills Holdings VI, L.L.C. and the Foothills Metropolitan District Regarding the Redevelopment of Foothills Mall. NOTE: Please refer to the May 7, 2013 Agenda Item Summary for a project overview, description of public benefits, and other project details (See Attachment 1). Overview of Changes On November 8, 2012, exclusive negotiations between the Fort Collins Urban Renewal Authority (URA) and Walton/Alberta were initiated under an Agreement to Negotiate. On May 8, 2013, the City Council and the URA Board each adopted a resolution authorizing and approving the execution of a Redevelopment and Reimbursement Agreement in connection with the redevelopment of the Foothills Mall. Since May, Alberta Development on behalf of Walton Foothills Holdings VI, L.L.C. (Developer) has continued to refine the site plan and program for the redevelopment of Foothills Mall. The following summarizes the changes to the project since May. Mall Configuration The Planning and Zoning Board (P&Z) approved a Project Development Plan (PDP) for the redevelopment of Foothills Mall on February 7, 2013. On December 12, 2013, P&Z reviewed a major amendment to the PDP. The major amendment includes a change in the total square footage of the project of approximately 10 percent, Table 1 highlights the differences. The biggest change is a reduction of the theater of approximately 43,000 square feet. Only concessions are taxable at a theater and constitute approximately one-third of total sales; therefore this reduction does not have a one for one proportional impact on anticipated retail sales. In addition, the changes include a reduction in other commercial space of approximately 32,000 square feet (the difference between the increase of interior mall space and reduction of all other space). January 14, 2014 428 Table 1 Project Square Footage Comparison Eligible Costs Review Certain projects costs are eligible for public assistance per Colorado Revised Statutes relating to Urban Renewal and Special Districts (Title 32). The types of eligible costs for each (Urban Renewal Authority and Metro District) are relatively broad, overlap to some extent, and include such categories as:  Acquisition of a blighted area;  Demolition and removal of buildings and improvements;  Installation, construction, or reconstruction of streets, utilities, parks, playgrounds, and other improvements necessary for carrying out the objectives of the urban renewal plan;  Carrying out plans for a program through voluntary action and the regulatory process for the repair, alteration, and rehabilitation of buildings or other improvements in accordance with the urban renewal plan;  Acquisition of any other property where necessary to eliminate unhealthful, unsanitary, or unsafe conditions, lessen density, eliminate obsolete or other uses detrimental to the public welfare, or otherwise remove or prevent the spread of blight or deterioration or to provide land for needed public facilities. It is important to note that the total amount of eligible costs per the Colorado Revised Statutes Feb. Dec. SF % Retained/Redeveloped Interior Mall 176,161 208,098 31,937 18.1% Macy's 127,971 127,971 0 0.0% Theater 86,754 43,655 -43,099 -49.7% Youth Activity Center 23,863 24,705 842 3.5% All Other Space 319,038 254,702 -64,336 -20.2% Total 733,787 659,131 -74,656 -10.2% Difference January 14, 2014 429 may be as high as $108 million -- significantly higher than the $53 million in public assistance being offered, which is approximately 49 percent of the estimate of total eligible costs (see Table 2). However, the Developer and the City established a process to identify project costs that are extraordinary costs associated with remediating blighted conditions on the property, or costs associated with public improvements or public infrastructure. These are costs in which there is direct public benefit. The process of identifying the eligible costs balanced the need to maximize the public benefit while ensuring the public assistance was the minimum amount necessary to make the project financially viable. The following provides a brief description of each of the eligible costs summarized in Table 2 below: Land Acquisition: This amount represents the estimated value of the land underlying the portions of the project that include the public gathering spaces such as the east and west lawns, the Foothills Activity Center, and other green or public spaces on the site. Parking Structure: The parking structure allows for greater utilization of site; specifically the ability to create public gathering spaces and additional pedestrian and bicycle facilities/amenities. Demolition/Abatement: Demolition and deconstruction of the aging facility represents an extraordinary cost associated with remediating blight and mitigation the hazardous materials. Fixture and Amenities: This represents urban design enhancements to the public gathering spaces (east and west lawns) to provide high quality of place. Ditch Relocation: Relocating a segment of the Larimer No. 2 ditch to the west side of College Ave. represents an extraordinary cost associated with remediating blight and provides an opportunity for a pedestrian underpass (described below). Site Work: This cost is associated with earthwork (grade and fill), site walls to alleviate topographic constraints on the site, as well as asphalt paving, curb and gutter, and sidewalks. Utilities: This represents upgrades and improvements to sanitary sewer, storm water, water lines and fire water systems. Soft Costs: Architectural and engineering costs associated with activity center, parking structure, as well as materials testing, and environmental/abatement management. Foothills Activity Center: A publicly owned and operated activity center that includes gymnasium, public meeting rooms and after-school programs for youth. Pedestrian Crossing/Underpass: A pedestrian connection linking MAX BRT and Foothills Mall utilizing Larimer No. 2 Ditch alignment under College Ave. Originally the developer requested $72 million in cost reimbursement. Through the negotiation January 14, 2014 430 process outlined above this amount was reduced to the $53 million public finance package presented in this document. The most notable reductions from the requested assistance fall into three categories: (1) Land Acquisition, which the developer requested $16 million in reimbursement; and (2) Soft Costs, which the developer requested $7.1 million, and (3) Parking Structure, which the developer requested $12.8 million. Table 2 Summary of Eligible Costs for Reimbursement, Comparison ($ Millions) The eligible costs have not changed significantly since May. The costs as site, utility, and public improvement costs remain fixed despite the change in the total square footage of the project. One change that has been specifically identified is the shift in the parking structure to 978 spaces and four stories from a larger six story structure. Staff queried the Developer regarding savings related to this shift. Alberta Partners indicates that the project budget has always assumed a smaller structure than was entitled and, therefore, the cost for this improvement has not changed. This is consistent with the Developer’s approach to the multifamily housing, which includes and entitlement for 800 units but has been modeled at 446 units based on developer input. Staff further evaluated the Developer’s statement by comparing the cost per space of a 4- story 978 space parking structure to current market costs. At the original cost estimate of $12.8 million this equates to $13,000 per space (excluding Architecture and Engineering Costs), which is consistent with costs for similar structures being constructed in the market today. Financial Investment Overview The following narrative summarizes the revised financing package and highlights changes since May. The public financing package still includes the pledge of four revenue sources in the following January 14, 2014 431 priority order: Sources Foothills Metropolitan District Capital Mills - The Metro District will pledge 50 mills of ad valorem real property tax revenue to the bond. This mill levy expires when the bond is fully repaid or within 25 years, whichever comes first. Property Tax Increment - The URA will pledge 100 percent of the annual ad valorem property tax increment revenue over the 25-year tax increment period or until the bond is fully repaid, if prior to expiration of the tax increment period, less an administrative fee up to a maximum of 1.5 percent of the gross property tax increment revenue received by the URA. Public Improvement Fee - The Developer will impose a 1 percent Public Improvement Fee (PIF) on all taxable transactions within the Project and pledge these revenues to the bond. This revenue source terminates with the repayment of the bond. Sales Tax Increment – As the URA will pledge 100 percent of the annual sales tax increment generated above a base by the Project from the City’s 2.25 percent General Fund Sales Tax rate (the “Core Rate”), which is the sales tax increment established for the URA in the Midtown Urban Renewal Plan. The above priority order works such that the first revenue source pledged to bond repayment is the last revenue source out. Debt service is paid from all revenues collected and excess pledged revenues are released by the Bond Trustee if not needed to support Debt Service as provided in the agreement. Therefore, Tax increment revenues will be returned to the URA and the City when not needed for debt service on the bond. Therefore, the Sales Tax Increment Pledge, despite existing for all 25 years, is expected to result in the return of funds back to the City as early as 2018. Project Cost Summary The total redevelopment project is estimated to cost $313 million; down from the estimated $319 million in May (previously misstated in the May 7 Agenda Item Summary). These costs are split between the commercial/retail at approximately $231 million (down from $237 million in May) or 74 percent and 446 anticipated residential units at a total cost of $82 million or 26 percent. The eligible costs, which remain the same as described in May (See Table 3), total approximately $53 million or 17 percent of the total cost and 23 percent of the commercial/retail costs. The eligible costs represents the target amount of bond proceeds to be generated by the pledged revenues. January 14, 2014 432 Table 3 Summary of Eligible Costs for Reimbursement ($ Millions) Slide 9 from the presentation Assumptions The financial analysis resulting in the public finance investment contemplated in the proposed Redevelopment and Reimbursement Agreement relies on several key assumptions. Several of these assumptions have changed since May. Each of assumptions and the changes are described briefly below: Project Timing - The financial analysis assumes a December 23 “go” date for commencement of construction activity. This result in a ground breaking in January/February 2014 and substantial completion of the project in November 2015, a delay of one year from the original schedule presented in May. Annual Sales Per Square Foot - The financial analysis assumes $378 per square foot in annual retail sales once the project stabilizes up from $350 per square foot in May (this rate excludes non-retail space and the anchor department store). The sale per square foot figure has increased due the increased confidence in anticipated retailers at the center. In addition, this assumption relies on several inputs: (a) the average annual sales per square foot figure for all Malls as provided by the International Council of Shopping Centers ($458 per square foot for 2012); and (b) Economic & Planning Systems full analysis of retail transfer, inflow and growth. Occupancy - The financial analysis assumes, based on the construction schedule, that 75 percent of the gross leasable area will be occupied by retail tenants by December 31, 2015. This number will grow to 95 percent occupancy and remain at this level by December 31, 2016. A delay of approximately one year. Blight Removal Infrastructure City Infrastructure Total Public Land Acquisition $ 5.5 $ 5.5 Parking Structure 9.6 9.6 Demolition / Abatement 3.9 3.9 Fixture & Amenities 1.4 1.4 Ditch Relocation 2.8 2.8 Site Work 12.9 12.9 Utilities 4.5 4.5 Soft Costs 4.6 4.6 Foothills Activity Center 4.8 4.8 Pedestrian Crossing / Culvert 3.0 3.0 TOTAL $ 45.2 $ 7.8 $ 53.0 January 14, 2014 433 Retail Sales Growth - The financial analysis assumes that retail sales will grow by 2 percent annually. This pace of growth is consistent with historical growth rates in the City of Fort Collins of 5.4 percent annually since 1990. In addition, this rate falls short of the historic growth rate of inflation as measured by the Consumer Price Index, 2.9 percent annually since 1982. NO CHANGE SINCE MAY. Property Value Growth - The financial analysis assumes that real property values will increase by 2 percent every other year or 1 percent average annually. This pace of growth is conservative compared to the historical growth rate in of real property in Larimer County. NO CHANGE SINCE MAY. Public Finance Revenue Summary The Redevelopment and Reimbursement Agreement contemplates utilizing the pledged revenues, as described, to support the issuance of a bond by the Foothills Metro District. The proceeds from the bond issuance are intended to pay or reimburse the eligible costs and to pay cost of issuance. As described, the bond will be supported by four revenue sources. In May, a single public finance scenario was presented in the Agenda Item Summary and staff presentation. The staff presentation attached to this document presents several scenarios covering assumptions about interest rate and sales tax rate. Two scenarios are highlighted including: (1) a scenario based on an assumed 7.00 percent interest rate consistent with the May assumption and (2) a more conservative scenario assuming a 7.25 percent interest rate. These scenarios are compared to the single scenario presented in May below, see Table 4. These scenarios indicate that the City sales tax increment applied to debt service on the bonds will range between $9.0 and $12.0 million depending on interest rate. In addition, the net new Sales Tax revenue to the City after release of pledged revenues over the 25 year time period will range between $108 and $117 million, depending on assumptions about interest rate and inclusion versus exclusion of sales transfer changes. The more specific information provided in subsequent tables below relates to the first scenario assuming a 7.00 percent interest rate consistent with the May assumptions. January 14, 2014 434 Table 4 Project and Public Finance Summary Comparison Slide 8 from the presentation The primary revenues supporting the bond will come from the Metro District in the form of annual ad valorem taxes on real property and from the Mall owner in the form of PIF revenues. These two revenue sources will generate $43.1 and $65.6 million respectively between 2014 and 2038. These revenues have decreased since May based on the changes to the project site plan and program; Table 5 shows a comparison. In addition, the pledged URA property tax increment will generate approximately $42.7 million during the same period. By 2020, these three revenue sources will represent $6.1 million in revenue annually. Based off the financial analysis, it is anticipated that sales tax increment contribution towards debt service and the supplemental reserve ends by 2018 until 2029 when additional sales tax increment contributions Jan 14th Jan 14th @ 7.00% Bond @ 7.25% Bond Gross Leasable Area 711k + 24k Sales Per Square Foot $350 Total Project Cost - Retail $237 Open Assumption Nov '14 Bonds at Par Value $73 $71 $72 Cum Bond Payments $165 $159 $163 First Three Revenue Sources $170 $151 $151 Dedicates Sales Tax Revenue $105 $106 $106 GF Sales Tax Revenue $147 $149 $149 Estimated City ST Remitted $8.8 $9.0 $12.0 Net New ST Revenue $108 $117 $114 Net New w/o Addtl Transfer $111 $108 $231 Phases '14-'15 ($ Millions except Sales per Square Foot) May 7th 641k + 24k $378 January 14, 2014 435 are required to meet the debt payments on the bond. The total sales tax increment contribution is anticipated to be $9 million. Table 5 Comparison of Public Finance Revenues Generated by the Project, 2014-2038 Slide 21 from the presentation In addition, sales tax increment has been pledged to support the issuance of a bond. There are three components to the sales tax generated by the Project, including: Base - Existing sales tax revenue generated by retailers in the Mall and surrounding Project Area. Transfer - Revenue from other areas of the city that shift to the Mall after redevelopment. New - The net new revenue, or revenue in excess of base and transfer, associated with the redeveloped mall project. In addition, the sales tax revenue can be broken by the various pieces of the effective 3.85 percent rate. There are two main pieces, including: Core City Sales Tax Rate - This corresponds to the long-standing 2.25 percent General Fund rate. Dedicated City Sales Tax Rate - This corresponds to the sum total of four dedicated sales taxes including: Transportation (0.25 percent), Natural Areas (0.25 percent), Building on Basics (0.25 percent), and Keep Fort Collins Great (0.85 percent) dedicated sales tax ($ Millions) Cumulative Annual Funding 2020 Cumulative Annual Funding 2020 First Three Revenue Sources 25 years 25 years District Property Tax $ 50.0 $ 2.1 $ 43.1 $ 1.8 URA Property Tax Increment 55.2 2.3 42.7 1.9 Developer Sales PIF 64.7 2.3 65.6 2.4 Metro District Funding $ 169.9 $ 6.7 $ 151.4 $ 6.1 Today's Value $ 62.5 $ 55.3 May 7th Jan 14th January 14, 2014 436 rates for a total of 1.60 percent. The revenue generated by the constituent pieces of the Sales Tax rates is summarized in Table 6. The base, transfer, and new components of the Dedicated City Sales Tax Rate will generate approximately $106 million between 2014 and 2038. In addition, the Core Rate base Sale Tax Revenue will generate approximately $44.5 million during the same period. Therefore, the total revenue generated by the project that is not pledged to the bond is approximately $150.5 million. Table 6 Comparison of Sales Tax Revenue Generated by the Project, 2014-2038 Slide 22 from the presentation The Agreement only pledges the transfer and new (together, the incremental) sales tax revenue related to the Core Rate. Based on the financial analysis, these sales tax increment revenues represent approximately $104.6 million (up from $102.7 million in May) or the anticipated pledged sales tax increment revenue. Public Finance Package Structure To better understand the structure of the public finance package, Table 7 summarizes the anticipated sales tax revenue split between the two rates (Core and Dedicated) by the three components (Base, Transfer, and New). In 2016, the total pledged sales tax increment revenue to the project (identified by the yellow) totals $3.2 million (up from $3.1 million in May) of the approximately $5.1 million generated by the Core Rate (2.25 percent). The City retains the remaining $5.4 million generated by the unpledged Dedicated Rate (1.60 percent) and Core Rate ($ Millions) Cumulative Annual Funding 2016 Cumulative Annual Funding 2016 City Sales Tax Revenue 25 years First Full Year 25 years First Full Year Dedicated Base / Transfer / New $ 104.6 $ 3.5 $ 106.0 $ 3.6 Core Base 44.4 1.8 44.5 1.8 Core Transfer & New 102.7 3.1 104.6 3.2 City Sales Tax $ 251.7 $ 8.4 $ 255.1 $ 8.7 Today's Value $ 94.7 $ 94.8 May 7th Jan 14th January 14, 2014 437 base. These numbers increase to $3.4 million in pledged increment revenue and $5.6 million in retained revenue by 2018. Table 7 Comparison of Annual Sales Tax Revenue Generated by the Project, 2016 & 2018 Slide 25 from the presentation As stated, the pledged sales tax increment revenue serves as the last revenue source to support the issuance of the bond. Therefore, as the remaining three pledged revenues grow over time the need for pledged sales tax increment revenue to support the bonds diminishes. The financial analysis demonstrates this in the estimated cash flow presented in Table 8. The bond will likely be issued in 2014 with three years of capitalized interest. Based on forecasts, revenue will first be available to fund debt payments (including contributions to the supplemental reserve) of the bond in 2015. In 2015, the pledged revenue sources, excluding the sales tax increment revenue, will generate approximately $1.8 million towards bond repayment and reserve contributions. The pledged sales tax increment revenue will generate an additional $0.8 million. These two revenue sources combined will generate sufficient revenue (along with capitalized interest) to cover the debt payment and reserve contributions required by the bond. The pledged revenue sources, excluding the sales tax increment revenue, will grow to $4.9 million in 2017 largely due to the delay in property tax valuation and collection. The pledged sales tax increment revenue is anticipated to grow to $3.3 million. Together, these revenues will cover the debt payment and the last sizable portion of the supplemental reserve fund contribution. Starting in 2018, the pledged revenue sources, excluding sales tax increment revenue, are anticipated to cover the debt payment, which is anticipated to terminate in 2038. As a result, ($ Millions) Base Transfer New Total Base Transfer New Total Core Tax - 2.25% 1.8 1.0 2.1 $ 4.9 1.8 0.9 2.3 $ 5.1 Dedicated Tax - 1.6% 1.3 0.7 1.5 $ 3.5 1.3 0.7 1.6 $ 3.6 Total $ 3.1 $ 1.7 $ 3.6 $ 8.4 $ 3.2 $ 1.6 $ 3.9 $ 8.6 Base Transfer New Total Base Transfer New Total Core Tax - 2.25% 1.8 1.1 2.2 $ 5.1 1.8 1.0 2.4 $ 5.3 Dedicated Tax - 1.6% 1.3 0.8 1.6 $ 3.7 1.3 0.7 1.7 $ 3.8 Total $ 3.1 $ 1.9 $ 3.8 $ 8.8 $ 3.2 $ 1.8 $ 4.2 $ 9.1 May 7th Sales Tax in 2016 Sales Tax in 2018 Jan 14th Sales Tax in 2016 Sales Tax in 2018 January 14, 2014 438 starting in 2018 the pledged sales tax increment revenue will not be required to meet debt payments or reserve contributions until 2029 when additional sales tax increment contributions will be required. These revenues will, according to the terms of the Agreement, be released back to the City. In 2018, the total sales tax revenue retained by the City and sales tax increment revenue released back to the City will rise to $9.0 million and continue at this rate with 2 percent growth per year. This constitutes a $4.2 million increase in net new revenues compared to the existing $4.8 million of sales tax revenue generated in 2012. Approximately $7.2 million of the pledge sales tax increment is used between 2015 and 2017 to support the debt payment and reserve contributions. Additional sales tax increment contributions will be required between 2029 and 2038 increasing the total estimated sales tax increment applied to the bonds to $9.0 million. Table 8 Anticipated Public Finance Cash Flow, 2012-2019 ($Millions) Slide 24 from the presentation One final change between the May financial package and the current version relates to the use of excess PIF revenue. The project financials are conservatively based on a sales estimate of $378 May 7th First 3 Revenue Sources Pledged Sales Tax Increment Bond Payments & Reserve Sales Tax Returned Base & Dedicated Sales Tax Sales Tax Revenue 2012 4.8 2015 2.1 2.5 4.6 --- 5.0 5.0 2016 2.3 3.1 5.4 --- 5.3 5.3 2017 6.5 3.2 9.7 --- 5.4 5.4 2018 6.5 3.3 6.0 3.3 + 5.5 = 8.8 2019 6.7 3.4 5.7 3.4 + 5.6 = 9.0 Jan 14th First 3 Revenue Sources Pledged Sales Tax Increment Bond Payments & Reserve Sales Tax Returned Base & Dedicated Sales Tax Sales Tax Revenue 2012 4.8 January 14, 2014 439 per square foot. The National average in 2012 for all malls was $455 per square foot and newer malls in Denver were $600 to $700 per square foot. Anticipating this upside potential, staff built into the May agreement the creation of a Foothills Mall Fund (FMF) where excess revenues from the PIF could be used for specific improvements associated with the Mall. The intent was to keep the Mall fresh and competitive in the retail market. On further reflection, staff considered the FMF provided additional value to the Developer and not the community. The Agreement requires the Developer to maintain the Mall as a “Class A” shopping center after completion of construction. The current Agreement requires the Bond Trustee to apply excess PIF revenue not needed for debt service (which is expected to result from retail sales upside) to pay down the principal on the bonds in the year the excess revenue is generated by the project. This will lower the overall interest payment and shorten the bond term by approximately four to five years assuming sales increase to $478 per square foot. Staff believes this would be beneficial to multiple constituents:  Tenants/Developer – Benefit from early termination of the Metro District Debt property tax of 50 mills reducing overall property tax costs at the site.  Citizens – Benefit from the early termination of the 1.00 percent PIF, which is required to terminate when the bonds are repaid.  Other Taxing Entities – Could benefit because the URA could elect to discontinue collecting property tax increment allowing these revenues to flow to the entities ahead of schedule.  City – Benefits from early payment of the bonds and termination of the sales tax increment, as well as from the sales tax revenue generated by the increase from $378 to $478 per square foot. B. Resolution 2014-005 Updating Prior Action Regarding the Redevelopment of Foothills Mall and Regarding Cooperation and Partnership with Larimer County on Economic Revitalization Efforts and the Use of Tax Increment Financing. Under Resolution 2013-045, the City committed to work with Larimer County to develop such agreements as may be necessary to develop a model for evaluating fiscal impacts associated with the formation of tax increment financing districts. Work was to be completed by December 15, 2013. For two reasons the work has not been completed - the County wants to involve multiple municipalities and when the floods hit, the County put this work on hold. The County has confirmed its desire to complete this work in 2014 and would like a one year extension. In light of the modification to the schedule for the Mall project, language regarding property tax increment to be shared with the County has been updated. C. First Reading of Ordinance No. 008, 2014, Vacating Foothills Parkway Right-of-Way Between College Avenue and Mathews Street, and Vacating a Portion of Mathews Street. Foothills Parkway was originally built and dedicated as a public street from College Avenue to Stanford Road with the development of the Foothills Fashion Mall (now known as Foothills Mall). In 1988, an expansion to Foothills Mall for Foley’s (now Macy’s) resulted in the vacation January 14, 2014 440 of Foothills Parkway right-of-way from Mathews Street to Stanford Road as approved in Ordinance No. 116, 1987 adopted by City Council on May 17, 1988. The owner of Foothills Mall has requested that the remaining public portion of Foothills Parkway from College Avenue to Mathews Street be vacated. Additionally, a portion of right-of- way along the west side of Mathews Street would be vacated due to the owner realigning a portion of Mathews Street intersecting Foothills Parkway, resulting in excess right-of-way. The owner received approval by the Planning and Zoning Board on February 7, 2013 of the Foothills Mall Redevelopment Project Development Plan and a condition of approval of the plan was made requiring this portion of Foothills Parkway be vacated. Vacations of public right-of-way are governed by City Code Section 23-115, which provides for an application and review process prior to submission to the City Council for formal consideration. The process includes review by potentially affected utility agencies, City staff, emergency service providers, and affected property owners in the vicinity of the right-of-way proposed to be vacated. This review process was followed in conjunction with review of the Foothills Mall Redevelopment Project Development Plan, and based on comments received; the Planning Development and Transportation Director recommended that the vacation be approved. With the proposed vacation, easements for access, emergency access, drainage, utilities, and transit would be retained, preserving rights to utilize the vacated portion for these purposes. In order to ensure that the vacation is tied to the approval of the Foothills Mall Redevelopment, this vacation is conditioned upon the recording of the Ordinance, which must occur concurrently with the recordation of the subdivision plat known as "Foothills Mall Redevelopment Subdivision". If Foothills Parkway and a portion of Mathews Street are vacated, the City will no longer be responsible for the maintenance, and as such, the roadways can be eliminated from the City’s street maintenance program. Ongoing maintenance of the area being vacated is the responsibility of the abutting property owner; however, with redevelopment of Foothills Mall, a metro district has been established, and maintenance of the vacated area would be assigned to the metro district. D. First Reading of Ordinance No. 009, 2014, Authorizing the Conveyance of a Permanent Irrigation Ditch Easement and Right-of-Way to the Larimer County Canal No. 2 Irrigating Company Within the South College Avenue Frontage Road. The Larimer No. 2 Ditch is currently located on the Foothills Mall site and is to be relocated to the west of College Avenue in an effort to accommodate the redevelopment of the mall and the adjacent properties. The proposal is to realign the ditch so that it flows underground in a box culvert from its current location immediately north of Red Lobster restaurant, within the College Avenue frontage road and day lighting at its current location immediately south of Monroe Drive. It should be noted that the additional benefit of realigning the ditch allows a pedestrian underpass to be constructed in the location where the ditch currently flows under College Avenue. The pedestrian underpass will allow the redeveloped mall to have excellent pedestrian connections to the Mason Corridor and MAX transit stations. January 14, 2014 441 The frontage road along College Avenue immediately adjacent to Markley Motors and Red Lobster restaurant was dedicated as right-of-way in the 1970's as part of the subdivision that created those commercial sites. Right-of-way that is dedicated to the City of Fort Collins is owned and maintained by the City; however, the adjacent property owners have a property right in the right of way in that if the City ever vacated the right of way, under State law, ownership of the land would revert back to those adjacent property owners. In order for the City to dedicate the required easement to the Larimer No. 2 Ditch Company for the relocated ditch, the City must acquire that underlying property right from Markley Motors and Red Lobster. The City has acquired the necessary property interests from Markley Motors and is in the process of acquiring the necessary property interests from Red Lobster. This Ordinance authorizes the City to convey a permanent easement to the Ditch Company to operate and maintain ditch facilities under the College Avenue frontage road, once the necessary remainder property interests have been acquired. It should be noted that the City is not seeking compensation from the ditch company for the conveyance of the easement because the relocation is occurring as a result of the redevelopment of the mall. FINANCIAL / ECONOMIC IMPACT Financial Impact to the City The financial analysis evaluated the impact of the sales tax increment pledge over the full 25 years of the bond term. This provides a fuller understanding of the impact to the City of the sales tax increment pledge. The total anticipated sales tax revenue generated by the Core Rate between 2014 and 2038 is approximately $149 million with $105 million in sales tax increment pledged toward the bonds (Transfer and New; shown in yellow), as shown in Table 9. The Dedicated Rate generates approximately $106 million between 2014 and 2038. The grand total of anticipated sales tax is approximately $255 million. Table 9 Comparison of Sales Tax Revenue Generated by the Project, 2014-2038 Slide 23 from the presentation As indicated previously, the staff presentation includes two public finance scenarios: (a) an assumed interest rate of 7.00 percent, and (b) an assumed interest rate of 7.25 percent. In both ($ Millions) Base Transfer New Total Base Transfer New Total Core Tax - 2.25% 44 35 68 $ 147 44 31 74 $ 149 Dedicated Tax - 1.6% 32 24 49 $ 105 32 22 52 $ 106 Total $ 76 $ 59 $ 117 $ 252 $ 76 $ 53 $ 126 $ 255 May 7th Jan 14th Sales Tax over 25 Years Sales Tax over 25 Years January 14, 2014 442 scenarios, the estimated new revenue between 2014 and 2038 is approximately $126 million. In the 7.00 percent scenario the estimated sales tax increment contribution to debt service is approximately $9.0 million. The estimated sales tax increment contribution to debt service in the 7.25 percent scenario is estimated at $12.0 million. Therefore, the estimated net new sales tax revenue received by the City or remitted to the City as released pledged sales tax increment, after subtracting the anticipated sales tax increment contribution to debt service, will range between $114 and $117 million or between $4.6 and $4.7 million annually on average. This amount is up from $108 million in net new revenue estimated in May. A change in the amount of sales tax transfer accounts for a substantial portion of the estimated increase in net new sales tax revenue to the City. Adjusting the above revised net new sales tax revenue estimates to exclude this increase in sales tax transfer reduces the anticipated range to between $108 and $111 million. This is an even more conservative estimate of anticipated net new revenue and remains on par with the previously estimated amount of $108 million presented in May. Economic Impact Analysis Overview The Project will generate economic impacts during construction and operations. The construction activities, occurring while the Developer builds and renovates Foothills, will generate one-time impact for construction workers and businesses in the area. The on-going operations of the redeveloped mall and the occupying tenants will create annual economic impacts, employing workers in the community and supporting additional economic activity throughout the region. An economic impact analysis prepared by TIP Strategies and ImpactDataSource evaluates the plan to redevelop the Foothills Mall (Attachment 3). The analysis uses the Project Development Plan as approved by the Planning & Zoning (P&Z) Board, on February 7, 2013, as the input, assuming a $312 million project investment and 446 multi-family residential units. The one-time construction activity will support 2,905 workers in the area and support $160.1 million in new earnings for these works, as shown in Table 9. The redeveloped mall operations represent the restaurant and retail employment and earnings supported by tenants at the mall. Currently, mall tenants employ 200-300 workers but employment is trending lower. It is projected that tenants leasing space in the redeveloped mall will employ a total of 1,200 workers when fully leased. In total, the mall’s operations will support 1,434 total workers and $28.4 million in workers’ earnings annually. January 14, 2014 443 Table 9 Summary of One-Time and Annual Economic Impacts Construction (One-Time) One-Time Jobs 2,905 Earnings $160,096,057 Average Earnings per Job $55,111 Operations (On-going)** Annual Jobs 1,434 Earnings $28,375,412 Average Earnings per Job $19,785 In addition to economic impacts, the redevelopment of the mall will generate one-time revenues collected by the City of Fort Collins. These revenues will be generated by the construction and renovation investment. Specifically, the redevelopment and construction project will result in sales and use tax collections, capital expansion fees, building permits and plan check fees. The one-time revenue from Sales and Use Taxes will total approximately $5.1 million with approximately $4.8 million in construction materials sales and use tax revenue and $197,000 in sales and use tax from construction worker spending, as shown in Table 10. The total building permit and plan check fees, capital expansion fees, utility fees, and street oversizing fees will total approximately $12.4 million. Table 10 Summary of One-Time Fiscal Impacts Sales and Use Taxes - Construction Materials $4,870,250 Sales and Use Taxes - Construction Worker Spending $197,245 Total Sales & Use Taxes $5,067,495 Building Permit & Plan Check Fees $848,414 Capital Expansion Fees (Less Credits) $3,441,306 Stormwater, Water & Wastewater Fees (Less Credits) $6,332,604 Street Oversizing Fees $1,729,600 Total Permit, Plan Check, and Fees $12,351,924 If Foothills Parkway and a portion of Mathews Street are vacated, the City will no longer be responsible for the maintenance, and as such, the roadways can be eliminated from the City’s street maintenance program. Ongoing maintenance of the area being vacated is the responsibility of the abutting property owner; however, with redevelopment of Foothills Mall, a metro district has been established, and maintenance of the vacated area would be assigned to the metro district. January 14, 2014 444 ENVIRONMENTAL IMPACTS Triple Bottom Line Analysis City staff prepared a Triple Bottom Line Analysis Map (TBLAM) for the Foothills Mall Redevelopment Project. The purpose of looking at major projects through a triple bottom line lens is to identify opportunities and issues in an unbiased and broad way. The TBLAM is not used to make decisions but rather to identify and work to mitigate issues, to optimize solutions whenever possible, and to inform decisions. The Mall TBLAM is presented in Attachment 4. Carbon Footprint A carbon footprint analysis was completed for the Mall Redevelopment Project at City Council’s request, to evaluate the footprint of the proposed redeveloped mall and compare that to the footprint of the existing mall and to the existing mall if it were operating under thriving conditions. A local sustainability engineering consulting firm, The Brendle Group, prepared the analysis in conjunction with City staff. The footprint analysis was reviewed and refined at a May 3, 2013 mall charrette and was provided to City Council on May 3rd separate from the AIS. Storm Water Quality The Foothills Redevelopment is required to meet current storm water standards, which will result in significant upgrades to the site. Runoff will be captured and treated to remove pollutants and discharged off site at a much slower rate than the existing condition. The storm water management and treatment facilities will provide significant reductions in peak rates of runoff from the site seen during all storm events. The reductions will create improvements in the environment downstream of the site such as reductions in the erosion of channels and improved water quality in rivers and streams that receive the runoff from the site. BOARD / COMMISSION RECOMMENDATION At its April 24 and May 1, 2013 meetings, the Economic Advisory Commission (EAC) recommended supporting the Redevelopment and Reimbursement Agreement. At its October 16, 2013 meeting, the EAC recommended supporting the revised Redevelopment and Reimbursement Agreement. PUBLIC OUTREACH The following lists outreach associated with all URA actions related to Foothills Mall. Outreach between 2007-2008 April 4, 2007 written notification to property owners and business interests April 6, 2007 published notification in the Coloradoan April 11, 2007 public open house April 17, 2007 City Council meeting, submitting the Existing Conditions Survey to the January 14, 2014 445 Planning and Zoning Board, Poudre School District, and Larimer County April 19, 2007 Planning and Zoning Board meeting Written notification to taxing entities May 15, 2007 City Council meeting, adopting the Foothills Urban Renewal Plan November 18, 2008 City Council meeting, dissolving the Foothills Urban Renewal Plan Outreach between 2011-2013 January 21, 2011 written notification to property owners and business interests February 1, 2011 City Council meeting, authorizing staff to prepare an Existing Conditions Survey April 20, 2011 public open house May 17, 2011 City Council meeting, submitting Existing Conditions Survey to the Planning and Zoning Board, Poudre School District, and Larimer County May 19, 2011 written notifications to taxing entities July 12, 2011 written notification to property owners and business interests 2011, general outreach was also provided throughout the year to community organizations, such as the South Fort Collins Business Association and Chamber of Commerce September 6, 2011 City Council meeting adopting the Midtown Urban Renewal Plan July 18, 2012 written notification to property owners and business interests (Mall area only) November 8, 2012 URA Board meeting, adopting an Agreement to Negotiate with mall Owner December 12, 2012 written notice to property owners and business interests December 12, 2012 published notification in the Coloradoan February 28, 2013 City Council meeting, reaffirming the Midtown Existing Conditions Survey and Urban Renewal Plan March 28, 2013 written notice to property owners and business interests regarding the plan amendment March 28, 2013 published notification in the Coloradoan regarding the plan amendment. General Outreach on the Financial Investment Package: Economic Advisory Commission Meeting, Special Session, April 24, 2013 and May 1, 2013 (Provided under separate cover as part of the City Council Packet on May 2, 2013) Fort Collins Area Chamber of Commerce, Local Legislative Affairs Committee, April 26, 2013 Open House for Board and Commission Chairs, April 30, 2013 Economic Advisory Commission Meeting, October 16, 2013 Council Finance Committee Meeting, October 21, 2013 Public Open House, October 30, 2013.” City Manager Atteberry stated this agreement is the result of years of work with three different property owners. January 14, 2014 446 Laurie Kadrich, Director of Community Development and Neighborhood Services, stated the major changes between the project approved February 7, 2013 and this project are slight reductions in the height of the buildings, improved pedestrian connectivity, reduced retail space around the perimeter of the mall, and reduced theater space. Kadrich discussed other site changes with the new project and detailed some of the reasons for redevelopment of the mall, including that it is a catalyst project for the Midtown Area. She detailed the two Ordinances for Council consideration. Mike Beckstead, Chief Financial Officer, stated this new project plan has about 10% less retail space than the original project and the opening has been delayed a year. He stated the financial deal is fundamentally unchanged. The amount of sales tax increment expected to be required to support the bonds would still be $9 million, assuming a 7% rate. In his opinion, the deal is fundamentally sound and has a structure designed to protect the City’s balance sheet. City Manager Atteberry stated Councilmember Cunniff had requested a summary of changes between was approved on February 7, 2013 and what was approved on December 12, 2013 by the Planning and Zoning Board. He noted Council has received that summary which includes a list of fifteen changes between the two versions. Additionally, there was a revised development agreement in Council’s read-before packet. Mayor Pro Tem Horak requested a summary of the changes for the benefit of the audience. (Secretary’s note: The Council took a brief recess at this point in the meeting.) Kadrich detailed the changes between the first and second projects approved by the Planning and Zoning Board. City Manager Atteberry stated the development agreement was made available to the public and Council on January 3 rd . Deputy City Attorney Daggett reviewed the development agreement changes made in the read- before packet and since that time. Councilmember Poppaw asked about the tree mitigation plan. Courtney Levingston, Project Planner, replied changes from the Project Development Plan approved in February include approximately ten fewer trees due to utility conflicts; however, the number of mitigation tree inches has been increased. Councilmember Overbeck asked about the termination clause. Beckstead confirmed the June 30, 2014 date is in the agreement for either party to terminate, should the bonds not be issued. Mayor Pro Tem Horak requested a summary of the development agreement changes made since January 3 rd . Beckstead replied with a summary of five changes. January 14, 2014 447 Cheryl Distaso, Fort Collins Community Action Network, questioned the use of these funds for the mall given the number of people living in poverty in Fort Collins and the need for affordable housing, and asked how these populations would benefit from this financial assistance package. Glen Colton, 625 Hinsdale Drive, opposed the mall finance package and stated the sales tax received by the City would be at the cost of shoppers. Tim Kenney, 2824 Abbotsford, supported the mall finance package and redevelopment. Donna Clark, Fort Collins Marriott Director of Sales and Marketing, supported the mall finance package and redevelopment. Bob Clancy, 2263 Trestle Road, supported the mall finance package and redevelopment. Reggie Casselberry, Fort Collins Marriott General Manager, supported the mall finance package and redevelopment. Jamey Cutter, Corner Bakery Café, expressed concern regarding an article written in the Coloradoan about the scraping of his building and noted there are eighteen years remaining on his lease. Kerrie Petruso, LensCrafters General Manager, supported the mall finance package. Lori Radcliff, Fort Collins resident, supported the mall finance package and redevelopment. Ryan Coffey, Fort Collins resident, supported the mall finance package and redevelopment. Brooke Tamlin, Palmer Properties Retail Manager, spoke on behalf of Spiro Palmer and supported the mall finance package. Mark Driscoll, 1906 Pacific Court, supported the mall finance package and redevelopment. John Clarke, 2208 Nancy Gray Avenue, supported the mall finance package and redevelopment. Mike Pruznick, Fort Collins resident, opposed the mall finance package. Michael Bello, Fort Collins resident, supported the mall finance package and redevelopment. Ray Martinez, 4121 Stoneridge Court, supported the mall redevelopment. Luke McFetridge, South Fort Collins Business Association, supported the mall finance package and redevelopment. Ashley Styles, Fort Collins resident, supported the mall finance package and redevelopment. January 14, 2014 448 Don Butler, Fort Collins resident, supported the mall finance package and redevelopment and commended Fort Collins citizens on their generosity. John Anderson, Fort Collins resident, agreed with Ms. Distaso’s comments and stated this project makes a joke of the City’s claims of sustainability. Casey Lipole, 3407 Stover, supported the mall finance package and redevelopment. Curt Bear, 611 Laporte, supported the mall finance package and redevelopment. Don Provost, Alberta Development Partners, commended the partnership and and discussed the community benefits of the project. Carolyn White, land use counsel for Alberta Development, stated this agreement is essentially the same as the agreement approved in May 2013 and provides approval for $53 million in public eligible costs to support a $300 million construction project. She requested Council support of the finance package. Nancy York, 130 South Whitcomb, stated she would have preferred a remodel of the existing mall and described the proposed new mall as an auto-magnet and the cause of an increase in air pollution. Additionally, Ms. York expressed concern regarding the salaries of mall employees and the future of Foothills Gateway. (Secretary’s note: The Council took a brief recess at this point in the meeting.) Councilmember Poppaw noted Council unanimously approved the first mall deal with Alberta and asked Mr. Provost for his input regarding whether or not he knew the May deal was not going to go through. Mr. Provost replied he was negotiating in good faith and the slight changes in the plan are not believed by Alberta to be significant enough to even have this meeting. Councilmember Poppaw stated this is a 10% decrease in the size of the mall and one year of revenue has been lost. She asked if Mr. Provost intends to begin the project, assuming this deal is approved. Mr. Provost replied in the affirmative. Ms. White replied the agreement has to not only be approved, but also executed, and stated the agreement is the same. Councilmember Poppaw disagreed and stated the 10% decrease in size and decrease in revenue for the City make the agreements different. Councilmember Troxell stated some of Council’s requirements added delays to the project. Councilmember Poppaw asked if Councilmember Troxell understood those delays would cause the mall opening to be pushed past December 2014. Councilmember Troxell replied the January 14, 2014 449 agreement that led to the vote in May included additional provisions added by Council which required additional work and time. Councilmember Poppaw asked if Council was specifically made aware that the mall would not open in December 2014 when it voted in May. City Manager Atteberry replied in the negative and stated it was his decision to bring the item before Council again given the extent of the changes. Councilmember Poppaw asked how the increase in internet shopping is going to impact this project. Beckstead replied there is no clear answer for that question; however, malls are still opening and relevant. He stated this project will provide a vibrant mall to the city. Councilmember Poppaw requested input regarding the Corner Bakery Café issue. City Manager Atteberry replied he also learned about the potential demolition of the building from the Coloradoan. Mr. Provost replied this tenant, among others, still has a lease and the information printed in the Coloradoan did not come from Alberta, who has no intention of demolishing the building. Councilmember Poppaw requested information regarding the average wage for mall employees. Josh Birks, Economic Health Director, replied that figure is part of the economic impact analysis. Councilmember Poppaw requested information regarding the projected loss of revenue due to the later opening date. Beckstead replied there is lost revenue at the front end; however, the economic model instead has the last year falling off as the lost revenue; in the metro district, that figure is a little over $8 million. However, that money is not truly lost as the model is focused on a fixed period of time. He estimated the sales tax revenue which would have been gained in 2014-2015 with the original opening date is about $3.5-4 million less that it will be with the later date. Birks stated the economic impact analysis shows jobs from the ongoing operations of the mall will have an average salary of $19,700. Councilmember Poppaw asked what the average monthly rental rate will be for the housing units in the project. Mr. Provost replied the housing products are still being developed and do not yet have established rents; however, rents will likely be at the higher end of the market. Councilmember Poppaw expressed concern about the lack of affordable workforce housing in the area. Councilmember Campana noted an affordable housing impact fee could be backdated so as to apply to this project. January 14, 2014 450 Councilmember Cunniff asked about an article indicating a request for an additional $13.7 million in fee reductions, or waivers, following the signing of the May agreement. Beckstead replied there was a request made in June or July for an additional $13-14 million of public improvements for blight remediation; the City met with Alberta in August and declined to offer any additional incentives. Councilmember Cunniff asked who covers the other half of the lost property tax and URA TIF revenue if the housing units are not built. Beckstead replied that is the City’s risk in this deal. Councilmember Cunniff asked about the wetland mitigation ratio for the canal relocation. Rick Richter, Director of Infrastructure Services, replied he would calculate the ratio. Councilmember Cunniff asked if the areas offering community activities, such as ice skating, are still part of the project. Mr. Provost replied in the affirmative. Councilmember Cunniff asked if the ability for children to do activities outdoors will be lost with the relocation of the Youth Activities Center. Bob Adams, Recreation Director, replied most of the City’s activities are currently located inside the facility and he does not anticipate much change between the locations. Mr. Provost discussed the potential use of the east lawn area for youth at the Center. Councilmember Campana asked what happens to the supplemental reserve fund when the bonds are no longer outstanding. Beckstead replied the fund is given back to the revenue sources that contributed to the fund. Councilmembers Campana and Cunniff had a brief discussion related to the risk to the City created by the finance package. Councilmember Cunniff discussed the net sales of the mall which suffered a precipitous decline following 2000 and noted the quality of the mall management moving forward is critical. Councilmember Campana discussed the agreement’s clause requiring certain landscaping and other standards to be maintained. Councilmember Overbeck asked how the June 30, 2014 termination date was developed. Beckstead replied it is an extension of the date in the May agreement. Councilmember Overbeck asked how quickly bonds could be issued. Beckstead replied a late spring timeframe is anticipated. Councilmember Troxell made a motion, seconded by Councilmember Campana, to adopt Resolution 2014-004. January 14, 2014 451 Councilmember Troxell commended the public-private partnership aspects of the agreement and the benefits the project will have for the Midtown area. Councilmember Campana thanked Alberta for its investment in the Fort Collins community and commended staff work and the patience of the community. He stated the deal is designed to minimize the City’s risk and encouraged the community to shop at the mall. Councilmember Cunniff stated he would not support the finance package as the cost is high and brick and mortar shopping is declining. He expressed concern regarding the mall aesthetics and the ability to follow-up on certain requirements of the agreement. Additionally, he stated he can no longer support the use of 100% TIF and stated this deal is not what Fort Collins citizens expect. Councilmember Overbeck stated the risks are greater than the rewards for this assistance package given the possibility of interest rate increases. He expressed concern regarding the location of the Youth Activity Center and retail closures. He also expressed concern regarding traffic and air pollution. Councilmember Poppaw stated an opportunity was lost with respect to including sustainability staff members and investigating the impacts of the project on lower wage earners. She stated she would support the motion but stated the package should have been better. Mayor Pro Tem Horak noted the Fort Collins Downtown was once in a similar situation as is the mall currently and discussed the use of the Downtown Development Authority. He commended the conservative approach taken by staff in developing the agreement and finance package. He suggested a retrospective study of the project upon completion. The vote on the motion was as follows: Yeas: Campana, Horak, Poppaw and Troxell. Nays: Cunniff and Overbeck. THE MOTION CARRIED. Mayor Pro Tem Horak requested a summary of Resolution 2014-005. City Manager Atteberry replied this item extends the prior agreement with Larimer County addressing some of its concerns regarding impacts. Councilmember Troxell made a motion, seconded by Councilmember Campana, to adopt Resolution 2014-005. Councilmember Cunniff stated he would support the motion. Councilmember Troxell stated he would support the motion in order to enhance the partnership between the City and County. January 14, 2014 452 The vote on the motion was as follows: Yeas: Cunniff, Horak, Poppaw, Overbeck, Troxell and Campana. Nays: none. THE MOTION CARRIED. Councilmember Troxell made a motion, seconded by Councilmember Campana, to adopt Ordinance No. 008-2014, on First Reading. Councilmember Troxell stated this is a routine item which makes sense for the project. Councilmember Cunniff agreed with Councilmember Troxell. The vote on the motion was as follows: Yeas: Cunniff, Horak, Poppaw, Overbeck, Troxell and Campana. Nays: none. THE MOTION CARRIED. Councilmember Troxell made a motion, seconded by Councilmember Campana, to adopt Ordinance No. 009-2014, on First Reading. Councilmember Troxell noted this item is critical to be completed as soon as possible. City Manager Atteberry stated Rick Richter is available to answer the previous wetland mitigation question. Richter stated there is a total of 1.5 affected areas which have been classified as low-quality existing wetlands. Those wetlands will be mitigated at a one to one ratio, likely in the Poudre River area with a higher quality replacement. The vote on the motion was as follows: Yeas: Cunniff, Horak, Poppaw, Overbeck, Troxell and Campana. Nays: none. THE MOTION CARRIED. Other Business Councilmember Cunniff stated he would like the City Manager to develop a process for monitoring, reporting, assessment, and oversight of this project and other economic development activities for performance. City Manager Atteberry replied he will report to Council regarding that structure. January 14, 2014 453 Adjournment The meeting adjourned at 9:25 p.m. _________________________________ Mayor Pro Tem ATTEST: _____________________________ City Clerk 2015 1.8 0.8 2.7 --- 3.8 3.8 2016 2.4 3.2 5.6 --- 5.5 5.5 2017 4.9 3.3 8.1 0.2 5.5 5.7 2018 5.5 3.4 5.3 3.4 + 5.6 = 9.0 2019 5.5 3.5 5.4 3.5 + 5.7 = 9.2