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Home My WebLink AboutCOUNCIL - COMPLETE AGENDA - 07/05/2011 - COMPLETE AGENDAKaren Weitkunat, Mayor Kelly Ohlson, District 5, Mayor Pro Tem Council Chambers Ben Manvel, District 1 City Hall West Lisa Poppaw, District 2 300 LaPorte Avenue Aislinn Kottwitz, District 3 Wade Troxell, District 4 Cablecast on City Cable Channel 14 Gerry Horak, District 6 on the Comcast cable system Darin Atteberry, City Manager Steve Roy, City Attorney Wanda Krajicek, City Clerk The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Assisted hearing devices are available to the public for Council meetings. Please call 221-6515 (TDD 224-6001) for assistance. REGULAR MEETING July 5, 2011 Proclamations and Presentations 5:30 p.m. A. Proclamation Declaring July 17-23, 2011 as Flood Awareness Week. B. Proclamation Encouraging all Citizens to “Take the Test, Take Control” to Prevent and Control HIV. Regular Meeting 6:00 p.m. PLEDGE OF ALLEGIANCE 1. CALL MEETING TO ORDER. 2. ROLL CALL. Page 2 3. AGENDA REVIEW: CITY MANAGER 4. CITIZEN PARTICIPATION (limited to 30 minutes) 5. CITIZEN PARTICIPATION FOLLOW-UP This is an opportunity for the Mayor or Councilmembers to follow-up on issues raised during Citizen Participation. CONSENT CALENDAR The Consent Calendar consists of Items 6 through 23. This Calendar is intended to allow the City Council to spend its time and energy on the important items on a lengthy agenda. Staff recommends approval of the Consent Calendar. Anyone may request an item on this Calendar be “pulled” off the Consent Calendar and considered separately. Agenda items pulled from the Consent Calendar will be considered separately under Item No. 29, Pulled Consent Items. The Consent Calendar consists of: ! Ordinance on First Reading that are routine ! Ordinances on Second Reading that are routine ! Those of no perceived controversy ! Routine administrative actions. 6. Consideration and Approval of the Minutes of the June 7, 2011, Regular Meeting. 7. Second Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. This Ordinance, unanimously adopted on First Reading on June 7, 2011, appropriates unanticipated Cultural Development and Programming (“CDP”) revenue and prior year reserves for the CDP accounts and prior year reserves for the Convention and Visitors Bureau. Lodging tax revenues in 2010 were $22,252 short of revenue projections; however, there are Lodging tax reserves from unspent appropriations in the amount of $113,066 available to be appropriated in the General Fund. In addition, $2,800 of unanticipated CDP revenue was received in 2011 which will be appropriated into the Cultural Development and Programming accounts. Individuals who wish to make comments regarding items scheduled on the Consent Calendar or wish to address the Council on items not specifically scheduled on the agenda must first be recognized by the Mayor or Mayor Pro Tem. Before speaking, please sign in at the table in the back of the room. The timer will buzz once when there are 30 seconds left and the light will turn yellow. The timer will buzz again at the end of the speaker’s time. Each speaker is allowed 5 minutes. If there are more than 6 individuals who wish to speak, the Mayor may reduce the time allowed for each individual. ! State your name and address for the record. ! Applause, outbursts or other demonstrations by the audience are not allowed ! Keep comments brief; if available, provide a written copy of statement to City Clerk Page 3 8. Second Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non-Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. Larimer County has a current construction project at the Larimer County Detention Center Campus, located on Midpoint Drive. This project includes an Alternative Sentencing Division building, an addition to the existing Sheriff’s Administration building, and an addition to the existing Community Corrections Facility. In addition, there will be parking lot modifications and site improvements. With these changes, the project will include an on-site detention pond. This Ordinance, unanimously adopted on First Reading on June 7, 2011, will grant a permanent utility easement for a 30-inch underground stormwater pipe to convey the detained runoff to Skunk Pond, which is part of Prospect Ponds Natural Area. 9. Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. Second Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. Second Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. Ordinance No. 068, 2011, authorizes the donation of a 1.75 acre parcel along the Poudre River from Larimer County to the City Natural Areas Program. The property is located adjacent to the north end of Arapaho Bend Natural Area. Ordinance No. 069, 2011 authorizes the donation of a three acre parcel located adjacent to Running Deer Natural Area, south of East Prospect Road, from Mike Sollenberger to the City Natural Areas Program. Both Ordinances were unanimously adopted on First Reading on June 7, 2011. 10. Second Reading of Ordinance No. 074, 2011, Appropriating Funds From the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce. This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan from the City to the Urban Renewal Authority (URA) to reimburse Kaufman and Robinson, Inc for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. 11. Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project. This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan in the amount of $3 million from the City to the Urban Renewal Authority (URA) to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Page 4 Fort Collins’ Water Fund Reserves to the URA will be $3 million and reimbursed to the project for the On-Site public improvements. Staff originally intended to request the funds from the City’s General Fund reserves however, after discussions with the Finance department, Utilities and the Attorney’s office, the request changed to the Utilities Water Fund reserves to ensure the URA was not overburdening the General Fund reserves. Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, assuming that staff-projected rate increases are implemented. The Ordinance provides that it is the Council’s intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the loan to the Water Fund to meet that need It is anticipated that the URA will issue bonds within the next few years, and in that event, the loan from the Water Fund would be repaid at that time. 12. First Reading of Ordinance No. 076, 2011, Appropriating Unanticipated Revenue in the General Fund for the Purchase, Training and Ongoing Maintenance of the E911 and Emergency Dispatch Systems at Fort Collins Police Services Dispatch Center. Larimer Emergency Telephone Authority provides funds to the Fort Collins Police Services to be used for equipment and training to process E911 calls. This Ordinance appropriates those funds. 13. First Reading of Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Light and Power Appropriations into the Light and Power Utility Relocation Capital Project. This Ordinance appropriates capital project funding for the Utilities to relocate existing electric, water and wastewater facilities to accommodate the Mason Corridor Bus Rapid Transit (BRT) Project. Light and Power will also supply power to the bus stations along the corridor. The Utilities are being viewed by the MAX/BRT Project as independent contractors and will be reimbursed by the MAX/BRT Project funds for the relocation expenses upon completion. The MAX/BRT Project will also pay for the cost of electric power supply to the bus stations. The Ordinance provides new capital appropriations in the Light Power Fund ($620,000), Water Fund ($625,000) and Wastewater Fund ($1,150,000) for the relocation work. Following completion of the construction, the Utilities will invoice the MAX/BRT Project based on actual costs and will receive the unanticipated revenue being appropriated by the Ordinance. In addition to electric duct bank relocation, Light and Power will use this opportunity to upgrade the capacity of the duct bank. These system upgrade costs have been budgeted in Light and Power’s existing 2011 lapsing appropriation. The Ordinance transfers $400,000 of the existing Light and Power lapsing budget into the new BRT electric relocation/upgrade capital project. The costs of the upgrade will not be reimbursed by the MAX/BRT Corridor Project. 14. Items Relating to the Hughes Stadium Disc Golf Course. A. Resolution 2011-053 Authorizing the City Manager to Enter Into a Grant Agreement with Great Outdoors Colorado for Funds for a Disc Golf Course at Hughes Stadium. B. First Reading of Ordinance No. 078, 2011 Appropriating Unanticipated Grant and Other Revenue in the Conservation Trust Fund for the Hughes Stadium Disc Golf Course. Great Outdoors Colorado has awarded the City an $85,000 grant for the completion of the Hughes Stadium Disc Golf Course. The project involves the development of an 18-hole disc golf course at Hughes Stadium in conjunction with Colorado State University. The course is primarily located in the Page 5 stormwater detention basin directly west of Overland Trail Road. The course will include new trees and shrubs, a new access road off County Road No. 42C, and the course tee areas and baskets. 15. Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26, and to Standards for Interconnection of Electric Generation Facilities. A. First Reading of Ordinance No. 079, 2011, Making Certain Amendments to Chapter 26 of the City Code Pertaining to the Provision of Net Metering Service and Certain Definitions Related Thereto. B. First Reading of Ordinance No. 080, 2011, Amending Various Provisions of the City Code and the Land Use Code Pertaining to the Definition of General Manager. C. First Reading of Ordinance No. 081, 2011, Making Certain Amendments to Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System The Fort Collins Utilities Light and Power Department is proposing minor revisions to the definitions section of Article I and to the Electric Article of Chapter 26 of the City Code and the Land Use Code. These revisions include updating the definition of General Manager, clarification regarding the provision of net metering service and clarification regarding authority to execute interconnection or parallel generation agreements on behalf of the City. Light and Power is also recommending adding clarifying language to the City’s indemnification and insurance requirements contained in the City’s Interconnection Standards. These standards govern operational and other requirements for interconnection generating facilities to the City’s electric distribution system. 16. First Reading of Ordinance No. 082, 2011, Calling a Special Municipal Election to Be Held in Conjunction with the November 1, 2011 Larimer County Coordinated Election. This Ordinance calls a Special Municipal Election to be held in conjunction with the November 1, 2011 Larimer County Coordinated Election, and preserves the opportunity for Council to place initiated or referred issues on the November ballot. If Council decides to place any measures on the ballot it would need to do so no later than at its August 16 meeting. If Council does not take action by ordinance or resolution before the statutory deadline (September 2) to certify ballot language to Larimer County, the election will be cancelled and the provisions of this Ordinance will be of no further force and effect. This Ordinance does not submit a specific measure to the November 1, 2011 ballot. However, a group of citizens is currently circulating an initiative petition proposing a prohibition on the establishment, operation or licensing of medical marijuana centers, optional premises cultivation operations, and medical marijuana-infused product manufacturing within the city of Fort Collins. The deadline to submit the petition to the City Clerk’s Office is July 19, 2011. Adoption of this Ordinance is a required step in preserving the option for City Council to submit the initiated ordinance, and/or any other ballot measures that Council may desire, at the November 1, 2011 Coordinated Election. 17. Items Relating to the Access Road at Soapstone Prairie Natural Area. A. First Reading of Ordinance No. 083, 2011, Authorizing the Transfer to Larimer County of Public Right-of-Way Easements Acquired by the City for the Reconstruction of Rawhide Flats Road. B. First Reading of Ordinance, No. 084, 2011, Authorizing the Conveyance of Access Easements to Three Private Land Owners within the Soapstone Prairie Natural Area. To complete the process of improving Rawhide Flats Road, the City has requested that Larimer County vacate sections of road right-of-way that were abandoned in 2008 when the road was realigned and reconstructed by the City to provide access to Soapstone Prairie Natural Area. The County conditioned its approval of the road improvements on the City’s follow up to request this Page 6 vacation in order to stop the unnecessary public use of the old abandoned road areas and to allow the land to revert to the surrounding landowner(s). Once the sections of right-of-way are vacated, the ownership will revert to the adjacent landowners. In connection with the vacation of the unneeded sections of right-of-way, the City is proposing to transfer to the County six new right-of-way easements that the City acquired to build the realigned portions of the improved road. This transfer will establish that the easements are held by Larimer County as public road easements for Rawhide Flats Road along with the other segments of the Road, and that the right-of-way being vacated is no longer needed. The City has also asked the County to vacate any remaining public road rights-of-way within Soapstone Prairie Natural Area. This action will establish that Rawhide Flats Road north of the Natural Area boundary line is a private road owned by the City for the sole purpose of providing access to Soapstone Prairie Natural Area. There are currently three property owners with in-holding properties within Soapstone Prairie Natural Area. When this section of Rawhide Flats Road is vacated, these owners will lose their legal access to their properties. In order to continue to provide these owners legal access to their property, the City will need to grant each owner an access easement from the boundary of the Natural Area to their property line. The access easements will follow the same alignment as the existing road on the Soapstone Prairie Natural Area. 18. First Reading of Ordinance No. 085, 2011, Authorizing the Conveyance to Capstone Development Corporation of Three Easements on Stormwater Utility Property at Creekside Park. Capstone Development Corporation (“Capstone”) is planning a mixed use development. This Project area is 10.4 acres and is located near Stuart Street and College Avenue. It fronts College Avenue around the Discount Tire property and continues to the west to the railroad. The project area is also at the rear of the Dairy Queen property. This mixed use development is for student housing and retail space. It will have two buildings, 221 dwelling units and 8,000 square feet of new retail space. The retail space will be the first floor of the building fronting on South College Avenue. For this development, Capstone has requested that the City grant Capstone a drainage easement for construction of a new flood control channel, a drainage easement for sheet flows from the adjoining property, and a temporary construction easement to construct a pedestrian trail and an underground stormwater pipe on City-owned property known as Creekside Park. 19. First Reading of Ordinance No. 086, 2011, Authorizing the Conveyance to Solitaire Homes, LLC of a Public Trail Easement on City Property. Solitaire Homes, LLC (the “Developer”) is planning a 27 acre (approximately) development north and west of Laporte Avenue and Taft Hill Road, opposite the Poudre School District offices. To facilitate a planned trail within the development, the Developer requests a 438 square foot public trail easement from the City across City property managed by the Water Utility. The City property is approximately 1,750 square foot. in size and is the site of a Water Utility valve vault. 20. Resolution 2011-054 Naming Three Alleys Within the Block Bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street. The Downtown Development Authority (DDA) is preparing a capital improvement project to enhance three alleys in the block bounded by South College, West Laurel, South Mason and West Olive. In conjunction with this project, the City of Fort Collins is preparing to name these three alleys. The three proposed names are “John Coltrane Alley,” “Ella Fitzgerald Alley” and “Billie Holiday Alley.” The selection of these three names is based on a public outreach process that resulted in a winning theme of eclectic music and art. If approved, the alley naming will simplify way-finding for pedestrians, bicyclists, drivers, delivery personnel and emergency responders. Page 7 21. Resolution 2011-055 Authorizing the Mayor to Execute an Amendment to the Intergovernmental Agreement with the Fort Collins Urban Renewal Authority. At the June 7, 2011 meeting, Council requested the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that, when the City advances funds to the URA in support of the URA’s activities, a loan agreement and promissory note accompany the advance of funds. 22. Resolution 2011-056 Making an Appointment to the Citizen Review Board. A vacancy currently exists on the Citizen Review Board due to the resignation of Evan Singleton. Councilmembers Gerry Horak and Ben Manvel and City Manager Darin Atteberry reviewed the applications on file. The interview team is recommending Robert Springer to fill the vacancy with a term to begin immediately and set to expire on December 31, 2013. END CONSENT 23. Consent Calendar Follow-up. This is an opportunity for Councilmembers to comment on items adopted or approved on the Consent Calendar. 24. Staff Reports. 25. Councilmember Reports. DISCUSSION ITEMS The method of debate for discussion items is as follows: ! Mayor introduces the item number and subject; asks if formal presentation will be made by staff ! Staff presentation (optional) ! Mayor requests citizen comment on the item (five-minute limit for each citizen) ! Council questions of staff on the item ! Council motion on the item ! Council discussion ! Final Council comments ! Council vote on the item Note: Time limits for individual agenda items may be revised, at the discretion of the Mayor, to ensure all citizens have an opportunity to speak. Please sign in at the table in the back of the room. The timer will buzz when there are 30 seconds left and the light will turn yellow. It will buzz again at the end of the speaker’s time. Page 8 26. Second Reading of Ordinance No. 071, 2011, Approving the Waiver of City Fees for the CARE Housing Affordable Housing Project in the Provincetowne Subdivision. (staff: Karen Cumbo; 10 minute staff presentation; 30 minute discussion) Under Colorado statute and City of Fort Collins ordinances and resolutions dating back to 1988, the projects of housing authorities are exempt from taxes and fees. For many years, the City has waived building permit and development review fees and some capital expansion fees for projects of the Fort Collins Housing Authority (FCHA), as required by the ordinance. For the most part, these have been relatively small projects. FCHA is currently partnering with the non-profit CARE Housing in a large, multi-family affordable housing project in the Provincetowne subdivision, which is under construction. Fee waivers for this project total $557,378. This Ordinance was adopted on First Reading on June 7, 2011, by a vote of 6-1 (nays: Ohlson). Based upon Council’s comments and questions during First Reading of this ordinance, staff has added more context, chronology, and explanation regarding affordable housing finance and the request for fee waivers for the Provincetowne, Filing III development. While the City has long been committed to affordable housing, and the need for financial support is clearly demonstrated in the increase in the number of applications for local and federal funds, the fiscal impact of this and future fee waivers for projects in which the FCHA is a partner rather than sole owner warrants some thoughtful evaluation of the waiver situation, and possibly some changes to the City Code. Additionally, considering the current and projected fiscal impact on the City for fee waivers for large projects, clarification for the definition of “ownership” as it pertains to the Housing Authority and its development partners will be part of the review. This policy issue will be addressed at an upcoming work session. Pending that policy discussion, the City Manager is recommending that Council consider waiving the fees due for the CARE Housing project. 27. Items Relating to the Fort Collins Museum/Discovery Science Center Project. (staff: Mike Freeman, Marty Heffernan; 15 minute staff presentation; 45 minute discussion) A. First Reading of Ordinance No. 087, 2011, Appropriating Prior Year Reserves in the General Fund for Transfer to the Capital Projects Fund for the Fort Collins Museum/Discovery Science Center Project. B First Reading of Ordinance No. 088, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Fort Collins Museum/Discovery Science Center Project. C. First Reading of Ordinance No. 089, 2011 Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Exhibits of the Fort Collins Museum/Discovery Science Center Project and Appropriating Unanticipated Revenue in the Capital Projects Fund. $3,875,000 in funding for the new Fort Collins Museum/Discovery Science Center is needed now to complete the building. Completion is scheduled for November 2011. The Downtown Development Authority (DDA) has committed $3 million for the building, but the funds are not currently available. The DDA is exploring funding options but will not have the funding in 2011. Adoption of Ordinance No. 087, 2011, will appropriate $3 million from General Fund reserves for the museum project to complete the building. The DDA plans to reimburse the City for the $3 million through financing provided by the City or from other funds secured by the DDA. The Non-Profit Corporation (NPC) has committed $4,761,916 to the museum building, with $875,000 of that amount in the form of pledges to be paid between 2012 and 2014. The NPC is working to obtain a private loan for the $875,000 but the financing will be costly and difficult to obtain. Adoption of Ordinance No. 088, 2011, will appropriate $875,000 from reserves in the Water Fund to complete Page 9 the building. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.5% and a maturity date of December 31, 2014. The loan will be evidenced by a loan and security agreement and corresponding promissory note. The NPC has raised $3.617 million for museum exhibits, with $1.2 million in the form of pledges to be paid in future years (2011-2017). The new museum will open with a nice, but somewhat limited exhibit experience without a bridge loan for the $1.2 million in exhibit pledges. Some exhibits will be postponed, and other exhibits will be more static, without the depth of knowledge or interactive technology that will be possible once the future year pledge money becomes available. Adoption of Ordinance No. 089, 2011, will appropriate $1.2 million from Water Fund reserves for museum exhibits. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.75% and a maturity date of December 31, 2017. The loan will be evidenced by a loan and security agreement and corresponding promissory note. 28. Resolution 2011-057 Establishing a Process for Enhancing Communication Between the City Council and the Council-Appointed Platte River Power Authority Board Member. (staff: Darin Atteberry, Brian Janonis; no staff presentation; 15 minute discussion) Each of the four member cities that established Platte River Power Authority (“PRPA”) has two representatives serving on the PRPA board of directors. One is the mayor, and the other is appointed by City Council. In May 2011, Council requested that a process be established to provide direction to the Council-appointed member of PRPA. This resolution establishes the process for the Council- appointed board member to communicate with, and receive comments from, City Councilmembers. 29. Pulled Consent Items. 30. Other Business. a. Possible Motion Regarding the Release of the Character Fort Collins Report. 31. Adjournment. Every Council meeting will end no later than 10:30 p.m., except that: (1) any item of business commenced before 10:30 p.m. may be concluded before the meeting is adjourned and (2) the City Council may, by majority vote, extend a meeting until no later than 12:00 a.m. for the purpose of considering additional items of business. Any matter which has been commenced and is still pending at the conclusion of the Council meeting, and all matters scheduled for consideration at the meeting which have not yet been considered by Council, will be continued to the next regular Council meeting and will be placed first on the discussion agenda for such meeting. urban renewal authority Karen Weitkunat, President City Council Chambers Kelly Ohlson, Vice-President City Hall West Ben Manvel 300 LaPorte Avenue Lisa Poppaw Fort Collins, Colorado Aislinn Kottwitz Wade Troxell Gerry Horak Cablecast on City Cable Channel 14 on the Comcast cable system Darin Atteberry, Executive Director Steve Roy, City Attorney Wanda Krajicek, Secretary The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224-6001) for assistance. URBAN RENEWAL AUTHORITY MEETING July 5, 2011 (after the Regular Council Meeting) 1. Call Meeting to Order. 2. Roll Call. 3. Consideration and Approval of the Minutes of the June 7, 2011 Meeting. 4. Resolution No. 036 Authorizing the Chairperson to Enter into an Amendment to the Intergovernmental Agreement with the City of Fort Collins. (staff: Mike Freeman, Christina Vincent; no staff presentation; 5 minute discussion) At the June 7, 2011 Council meeting, Council requested that the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that whenever the City advances funds to the URA, a loan agreement and promissory note accompany the advance of funds. 5. Other Business. 6. Adjournment. Karen Weitkunat, Mayor Council Information Center Kelly Ohlson, District 5, Mayor Pro Tem City Hall West Ben Manvel, District 1 300 LaPorte Avenue Lisa Poppaw, District 2 Fort Collins, Colorado Aislinn Kottwitz, District 3 Wade Troxell, District 4 Cablecast on City Cable Channel 14 Gerry Horak, District 6 on the Comcast cable system Darin Atteberry, City Manager Steve Roy, City Attorney Wanda Krajicek, City Clerk The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224- 6001) for assistance. WORK SESSION July 5, 2011 After the Urban Renewal Authority Meeting 1. Call Meeting to Order. 2. Modernizing Water and Electric Infrastructure. (staff: Brian Janonis, Steve Catanach, Kraig Bader; 90 minute discussion) The objective of this work session item is to provide City Council with an update on the Advanced Meter Fort Collins project. The project involves the upgrade of all of the electrical and water meters within the City utilities service territories. The project will improve current operations within Utilities, help meet the goals established in the Energy Policy, enhance our ability to serve customers, and ensure that Utilities is well positioned to support the current evolution of the traditional electric utility. The opportunities available to customers surrounding involve their energy choices are growing. Looking towards the future, industry predictions suggest that the life-cycle cost of installing solar panels will be the same as, or less than, electrical prices from the utility within the decade. In addition, consumers have expressed a strong interest in the adoption of electric vehicles. In response, manufacturers are investing heavily in the development of electric vehicles; there are currently 34 all-electric vehicle manufacturers in the United States. A recent report from the Department of Energy addressing the progress toward the President’s goal of “One Million Electric Vehicles By 2015” indicates that the manufacturing capability already exists and the next necessary step is educating and supporting the consumer. The installation of advanced metering technology provides a foundation that will enable Fort Collins Light & Power to support, inform and empower our community by providing energy choices while maintaining the same level of quality service and high reliability provided to customers today. The key benefits defined include: • use information and technology to maintain high system reliability • make utility operations even more cost-effective • provide more timely customer service • prepare the utility and the community for emerging technologies. 3. Other Business. 4. Adjournment. PROCLAMATION WHEREAS, April to September is the season most commonly associated with snowmelt flooding and thunderstorm flash flooding; and WHEREAS, Fort Collins has experienced the social, economic and environmental consequences of loss of life and damage to property caused by flood disasters; and WHEREAS, emergency preparedness depends on the leadership and efforts of public officials dedicated to public safety; and WHEREAS, emergency preparedness requires the establishment of farsighted and proactive public policy; and WHEREAS, by being informed and prepared, and by taking proper protective action, the people of Fort Collins can reduce the potential for loss of life and damage to property when threatened by these events. NOW, THEREFORE, I, Karen Weitkunat, Mayor of the City of Fort Collins, do hereby proclaim the week of July 17-23, 2011, as FLOOD AWARENESS WEEK IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the City of Fort Collins this 5th day of July, A.D. 2011. __________________________________ Mayor ATTEST: _________________________________ City Clerk PROCLAMATION WHEREAS, the medical condition now known as HIV and AIDS was first detected in our country thirty years ago and the HIV/AIDS epidemic is now entering its fourth decade; and WHEREAS, in 1995, the National Association of People With AIDS launched the National HIV Testing Day campaign in response to the growing number of HIV infections in communities of color and other heavily impacted communities, and organized annual National HIV Testing Days in partnership with the federal Centers for Disease Control and Prevention and other national and local entities across the country; and WHEREAS, mayors of our cities and towns are uniquely well placed to help their constituents understand that all Americans need to be tested for HIV, to safeguard their own health and help bring the epidemic under control; and WHEREAS, this unique and effective program created by people living with HIV and AIDS sends the message that prevention and control of HIV is a community, as well as an individual, imperative. NOW THEREFORE, I, Karen Weitkunat, Mayor of the City of Fort Collins, do hereby encourage all citizens to “TAKE THE TEST, TAKE CONTROL” and to seek out voluntary HIV testing and counseling to learn about their HIV status to take control of their lives. IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the City of Fort Collins this 5th day of July, A.D. 2011. __________________________________ Mayor ATTEST: _________________________________ City Clerk DATE: July 5, 2011 STAFF: Wanda Krajicek AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 6 SUBJECT Consideration and Approval of the Minutes of the June 7, 2011, Regular Meeting. June 7, 2011 COUNCIL OF THE CITY OF FORT COLLINS, COLORADO Council-Manager Form of Government Regular Meeting - 6:00 p.m. A regular meeting of the Council of the City of Fort Collins was held on Tuesday, June 7, 2011, at 6:00 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll call was answered by the following Councilmembers: Horak, Kottwitz, Manvel, Ohlson, Poppaw, Troxell and Weikunat. Staff Members Present: Atteberry, Krajicek, Roy. Agenda Review City Manager Atteberry withdrew Item Nos. 19 and 21, Items Relating to the Greeley Bellvue Pipeline on City Property and Items Relating to the Fort Collins Museum/Discovery Science Center Project, to a later date, and moved Item No. 10, Second Reading of Ordinance No. 064, 201, Appropriating Unanticipated Grant Revenue and Prior Year Reserves In the Capital Projects Fund for the North College Avenue Improvements - Vine Drive to Conifer Project, to the Discussion Agenda. Citizen Participation Eric Sutherland, 3520 Golden Currant, opposed the City’s investment in the Smart Grid Program. Virginia Farver, 1214 Bellvue Drive, questioned the City’s investment in the Smart Grid Program. Terri Williams, 2018 Niagra Court, expressed concern regarding the City’s investment in Smart Grid technology. Michelle Martens, Fort Collins resident, expressed concern regarding Smart Grid Program privacy issues and monitoring. Thomas Edwards, Fort Collins Bicycle Coalition, discussed bicycle trip numbers in the Fort Collins community and violations of traffic laws. Mel Hilgenburg, 172 North College, supported the Veterans Plaza Project and suggested possible licensing for e-bike users. Stacy Lynne, 216 Park Street, discussed the difference between fact and opinion and the idea of a magistrate versus a judge. 336 June 7, 2011 Citizen Participation Follow-up City Manager Atteberry noted the Smart Meter Program will be discussed at the July 5th work session. CONSENT CALENDAR 6. Consideration and Approval of the Minutes of the May 3 and May 17, 2011, Regular Meetings. 7. Second Reading of Ordinance No. 061, 2011, Appropriating Funds from the City’s Storm Drainage Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Northeast College Corridor Outfall Project. This Ordinance, unanimously adopted on First Reading on May 17, 2011, appropriates funds from the City’s Storm Drainage Fund Reserves for the purpose of providing a loan to the Fort Collins Urban Renewal Authority (URA). The proposed loan provides the URA with the necessary funds to contribute $326,472 to the purchase of the Northeast College Corridor Outfall detention pond (purchase completed in July, 2010). This contribution will cover the shortfall in the land purchase transaction and repay the City’s Stormwater Fund capital projects budget. The loan from the Storm Drainage Fund Reserves will be interest only for a term of 10 years. As stated in the Agenda Item Summary on First Reading, the interest rate associated with the NECCO loan was to be set at the 10-year treasury bill rate on the day after URA Board authorization or May 18, 2011. The corresponding treasury bill rate was 3.181 percent on that day and will be the effective rate of this loan. 8. Second Reading of Ordinance No. 062, 2011, Appropriating Prior Year Reserves in the Capital Projects Fund for the Building on Basics Lincoln Center Renovation Project. During the Lincoln Center Addition and Renovation project, an unanticipated structural issue with the 32 year old Performance Hall walls was discovered. The structural problem is significant and the Performance Hall walls will require additional structural support. This work must be completed before the facility can be reopened. Previously, $460,000 was appropriated for these repairs. This Ordinance, unanimously adopted on First Reading on May 17, 2011, appropriates an additional $135,000 from prior year reserves in the Capital Project Fund Building Community Choices program to complete the structural work. 9. Second Reading of Ordinance No. 063, 2011, Making Certain Amendments to Chapter 7, Article III, Division 3 of the City Code Governing Council Election Districts. At the April 5, 2011 City election, voters approved a Charter amendment which changed the method for adjusting City Council district boundaries so that the size and configuration of Council districts is based on the number of people residing in each district (population), 337 June 7, 2011 rather than the number of registered electors. The Charter, as amended, calls for the Council to establish by ordinance the process for adjusting district boundaries and giving notice of any proposed boundary changes and the manner of protesting such proposed changes. This Ordinance, unanimously adopted on First Reading on May 17, 2011, amends existing provisions in the City Code to establish the process of adjusting district boundaries based on population. 10. Second Reading of Ordinance No. 064, 201, Appropriating Unanticipated Grant Revenue and Prior Year Reserves In the Capital Projects Fund for the North College Avenue Improvements - Vine Drive to Conifer Project. The limits of this phase of the North College Improvement Project are from Vine Drive to the Hickory/Conifer intersection. Improvements will include a two inch asphalt overlay, the construction of various urban design elements, an eight foot on-street bike lane, a landscaped parkway, shared use paths, the definition and consolidation of accesses throughout the corridor, an updated storm system including water quality treatment ponds, and safety improvements at the Conifer/Hickory Intersection. The total project budget of $11.19 million includes $2.7 million from residual funds available from the Building on Community Choices (BCC) Tax Initiative of 1997. This Ordinance, unanimously adopted on First Reading on May 17, 2011, appropriates $1,001,000 in additional grant funds received from the Colorado Department of Transportation and $2.7 million from prior year reserves in the Capital Projects Fund, Building Community Choices reserves for expenditure on this Project. The residual BCC funds appropriated are to be repaid to the City of Fort Collins by the Urban Renewal Authority (URA) when the URA has the funds to repay the BCC funds. Due to the timing of the improvements, the URA contributions will not be available at the start of construction. The total appropriation of $11,186,000 will allow the project to be constructed to the full project limits from Vine Drive to Conifer as outlined in the Building on Basics (BOB) 2005 Tax Initiative. 11. First Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. This Ordinance appropriates unanticipated Cultural Development and Programming (CDP) revenue and prior year reserves for the CDP accounts and prior year reserves for the Convention and Visitors Bureau. Lodging tax revenues in 2010 were $22,252 short of revenue projections; however, there are Lodging tax reserves from unspent appropriations in the amount of $113,066 available to be appropriated in the General Fund. In addition, $2,800 of unanticipated CDP revenue was received in 2011 which will be appropriated into the Cultural Development and Programming accounts. 338 June 7, 2011 12. First Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non-Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. Larimer County has a current construction project at the Larimer County Detention Center Campus (LCDC) located on Midpoint Drive. This project includes an Alternative Sentencing Division building, an addition to the existing Sheriff’s Administration building, and an addition to the existing Community Corrections Facility. In addition, there will be parking lot modifications and site improvements. With these changes, the project will include an on-site detention pond. To handle the drainage from the site, Larimer County is requesting that the City grant a permanent utility easement for a 30-inch underground stormwater pipe to convey the detained runoff to Skunk Pond, which is part of Prospect Ponds Natural Area. 13. Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. First Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. First Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. Larimer County would like to transfer the ownership and management of a 1.75 acre parcel along the Poudre River and located adjacent to the north end of Arapaho Bend Natural Area to the City Natural Areas Program (“NAP”). Mike Sollenberger has agreed to donate the three acre parcel located adjacent to Running Deer Natural Area, south of East Prospect Road to the NAP. 14. Resolution 2011-050 Authorizing the Execution of an Updated Intergovernmental Agreement Between the City of Fort Collins, the City of Longmont and Platte River Power Authority. In January 1998, the City of Fort Collins, the City of Longmont and Platte River Power Authority (Platte River) entered into a 10-year intergovernmental agreement (the Agreement) for Platte River to purchase and operate a joint customer information system (CIS) for customer account management and billing on behalf of the two cities. On August 26, 2008, the term of the Agreement was extended for two years. 339 June 7, 2011 On August 17, 2010, City Council adopted Resolution 2010-049 extending the term of the Agreement to August 26, 2011, to allow additional time for staff discussion. The staffs of the two cities and Platte River have discussed and agreed on the terms of a draft updated CIS Agreement (Updated CIS IGA) and are bringing forward the draft Updated CIS IGA for Council approval. 15. Resolution 2011-051 Reappointing Gordon F. Esplin as Temporary Judge and Authorizing the Execution of an Employment Agreement. Council originally appointed Gordon F. Esplin as Temporary Judge (Assistant Municipal Judge) in 1989, and has reappointed him every two years thereafter. His current appointment terminates on June 30, 2011. Municipal Judge Kathleen M. Lane recommends that Mr. Esplin be reappointed for another two-year term. Mr. Esplin has been paid $85 per hour for his services for several years now. While that rate is well below the going rate for legal fees in Fort Collins, it is an appropriate rate for this occasional hourly service when compared with what other municipalities pay their Assistant Municipal Judges. Mr. Esplin has agreed to continue in this position at the current pay rate. ***END CONSENT*** Ordinances on Second Reading were read by title by City Clerk Krajicek. 7. Second Reading of Ordinance No. 061, 2011, Appropriating Funds from the City’s Storm Drainage Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Northeast College Corridor Outfall Project. 8. Second Reading of Ordinance No. 062, 2011, Appropriating Prior Year Reserves in the Capital Projects Fund for the Building on Basics Lincoln Center Renovation Project. 9. Second Reading of Ordinance No. 063, 2011, Making Certain Amendments to Chapter 7, Article III, Division 3 of the City Code Governing Council Election Districts. 10. Second Reading of Ordinance No. 064, 201, Appropriating Unanticipated Grant Revenue and Prior Year Reserves In the Capital Projects Fund for the North College Avenue Improvements - Vine Drive to Conifer Project. Ordinances on First Reading were read by title by City Clerk Krajicek. 11. First Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. 340 June 7, 2011 12. First Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non-Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. 13. Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. First Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. First Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. 19. First Reading of Ordinance No. 070, 2011, Authorizing the Conveyance of a Waterline Easement, Access Easement, and Temporary Construction Easement on City property to the City of Greeley. 20. First Reading of Ordinance No. 071, 2011, Approving the Waiver of City Fees for the Care Housing Affordable Housing Project in the Provincetowne Subdivision. 22. First Reading of Ordinance No. 074, 2011, Appropriating Funds From the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce. 23. First Reading of Ordinance No. 075, 2011, Appropriating Funds from the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Second Loan for the North College Marketplace Project. Councilmember Manvel made a motion, seconded by Councilmember Troxell, to adopt the Consent Calendar as modified. Yeas: Weitkunat, Kottwitz, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Staff Reports Larimer County Sheriff Justin Smith discussed the expiring County Jail sales tax and stated an initiative may be placed before voters to maintain the current sales tax level to support basic County services, including Jail operations. A partial river restriction is being considered to keep tubers and other recreational users off the Poudre River due to high water concerns. 341 June 7, 2011 Sergeant Jeremy Yonce gave a presentation regarding “Downtown After Dark,” noting the high number of liquor-licensed establishments in the Downtown area. He discussed fine increases and community service options for individuals receiving violations for disturbances. Councilmember Manvel commended Sergeant Yonce and Police Services for work on Downtown issues. Councilmember Horak asked about the rationale for the amount of fine reduction for performing community service clean-up efforts. Yonce replied fine reduction has always been part of the system; however, the City is now getting service in return. Councilmember Horak asked about cameras in the Downtown area. Yonce replied cameras are present in many businesses and the cameras in Downtown are planned to be used for marketing purposes as well as to provide evidence for any type of crime. Councilmember Horak asked if the decision to place cameras was made by Council. City Manager Atteberry replied he would return with more information. Councilmember Horak suggested a derivation of this presentation should be placed on Channel 14. City Manager Atteberry stated Plan Fort Collins has been selected as the 2011 American Planning Association Colorado Excellence Award recipient in the category of Outstanding Planning Project. Mark Jackson, Planning, Development, and Transportation Budget, Policy and Communication Manager, reported the Downtown paving project was completed within budget two weeks early. Councilmember Horak asked why the project was completed two weeks early. Larry Schneider, Street Superintendent, replied the schedule allowed for weather delays and appropriate nighttime temperatures. Councilmember Reports Councilmember Poppaw discussed her tour of the Adoption Dreams Come True facility. She announced Mayor Pro Tem Ohlson received a lifetime achievement award from the Colorado Association for Recycling for his work to promote recycling in Northern Colorado. Councilmember Troxell announced the Veterans Plaza dedication at Spring Canyon Park and the Big Splash event at the Water Works. Councilmember Horak stated the Poudre Fire Authority Board met and formed a sub-committee regarding the Fire Chief selection process. Mayor Weitkunat discussed the Finance Committee meeting topics which included the Discovery Science Museum and refinancing storm drainage. The Greeley Stampede has proclaimed June 30, 2011, as the City of Fort Collins day at the Stampede. Group Lima Grain held its North American office grand opening at its Fort Collins location. 342 June 7, 2011 Ordinance No. 071, 2011, Approving the Waiver of City Fees for the Care Housing Affordable Housing Project in the Provincetowne Subdivision, Adopted on First Reading The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY Under Colorado statute and City of Fort Collins ordinance, the projects of housing authorities are exempt from taxes and fees. For many years, the City has waived fees for projects of the Fort Collins Housing Authority (FCHA), as required by the ordinance. For the most part, these have been relatively small projects. FCHA is currently partnering with the non-profit CARE Housing in a large, multi-family affordable housing project in the Provincetowne subdivision, which is under construction. Fee waivers for this project total $557,378. While the City has long been committed to affordable housing, and the need for financial support is clearly demonstrated in the increase in the number of applications for local and federal funds, the fiscal impact of this and future fee waivers for projects in which the FCHA is a partner rather than sole owner may warrant some thoughtful evaluation of the waiver situation, and possibly some changes to the City’s Code. In addition to considering the current and projected fiscal impact on the City for fee waivers for large projects, clarification is also being sought from City Council on the definition of “ownership” as it pertains to the Housing Authority and its development partners. This issue will be addressed at a future work session. Pending that policy discussion, the City Manager is recommending that Council consider waiving the fees due for the CARE Housing project. BACKGROUND / DISCUSSION CARE Housing (a non-profit) bought a portion of the Provincetowne project site, located at Autumn Ridge Road and Trilby, from KB Homes to fulfill the affordable housing requirement for the entire residential project. The financing of affordable housing is rather complex, especially in today’s economic climate. A fifteen year federal tax credit for private investors is a critical component of the financial package, and the private investor (J.P. Morgan Chase, in this case) must be a 99% owner. The Housing Authority is technically only a .001% participant in this project, but is further involved because it guarantees up to $1.4 million of unanticipated costs. The affordability period for the Project is 40 years. Under certain circumstances, the Housing Authority could take over the project. State law contemplates the type of tax credit financing structure that is being used to finance this Project (where the Housing Authority has only a partial ownership interest), by stating that a project is exempt from taxation if it is owned by “an entity in which an entity wholly owned by an authority has an ownership interest.” It is not clear, however, whether the statutory intent is to also exempt such a project from fees. That is because, as to the exemption from both taxes and fees, the statute states that just “the authority” is exempt. 343 June 7, 2011 Another component of the financing picture for this project is the expectation by FCHA partners and its lenders that the fee exemption for which the Fort Collins Housing Authority is eligible under state law and the City Code passes to the other funding partners. This includes a waiver of taxes and development review and capital expansion fees as provided in Sec. 7.5-17(1) of the Fort Collins City Code. The degree of the FCHA’s ownership of the project has been the subject of considerable discussion. Does (or should) the waiver of fees for the Housing Authority properly extend to majority partners, or should it be limited to projects wholly owned, developed and operated by the Fort Collins Housing Authority, or projects with some specified ownership interest? A related concern in the extension of the fee waivers to FCHA partners is the criteria for approving projects and partners. Several local projects, either partially or wholly composed of affordable units, have sought support from the FCHA, and not all such requests have been approved by the FCHA board. The FCHA considers financial feasibility, benefit to low-income households, access to support services and other criteria, before agreeing to participate. Affordable Housing Projects and Fees Development and building permit fees for affordable housing projects are currently handled in two ways: 1. If the Housing Authority is involved, all fees and taxes, except for utility fees, are waived as described above, pursuant to both State law and City Code. 2. For affordable housing projects that do not involve the Housing Authority, the following occurs: a. By City Code, development review fees are waived according to the percentage of the project that meets the criteria for and has been designated as affordable. If a project receives a 100% affordable housing designation, 100% of the development review fees are waived; if 10% of the housing units are designated affordable, 10% of the fees are waived. b. Sales taxes are waived for any tax-exempt entities. c. By City Code, plan check, building permit and certain utility fees are collected at the time of building permit issuance. d. By City Code, all other fees are delayed until Certificate of Occupancy issuance, or December 1st of the year the building permit was issued, whichever first occurs. Development review fees cover services rendered; if the fees are waived, and the services are still provided, then the General Fund presumably backfills the gap of expenses incurred. Likewise, impact fees (parkland, fire, street oversizing, police, etc.) cover capital costs associated with new development. If the fees are waived and the capital improvements still provided, then City, Poudre 344 June 7, 2011 Fire Authority (PFA) and School District funds presumably backfill the gap. Utility connection fees are not waived. The City has routinely waived fees for FCHA projects in the past. Most of those waivers dealt with relatively small projects. The last significant new FCHA construction project was the Via Lopez project in 1998 and 1999. The FCHA was 100% owner of the development, which included 22 single family detached homes; fee waivers totaled approximately $107,476. Over $1.5 million of City administered competitive funds, including CDBG and HOME, have already been expended on the Provincetowne project, including payment of water tap fees, electric capacity fees, PFA fees, and building permit fees. Building permits have been issued for all eleven buildings and construction is underway, with the first units expected to be ready for occupancy by June 11. Because of concerns about significant financial and policy impacts on the City, management staff and the City Attorney’s Office have explored several facets of this issue. Staff also worked with the FCHA and CARE Housing on some proposed alternatives to a full waiver of fees for projects involving FCHA partnerships, including deferring those fees rather than waiving them or limiting the waiver to situations where the FCHA is the majority owner of the project. However, each of the alternatives examined was problematic in this situation, primarily because the projections for the Project were developed, and financing structured, based on the assumption that the fees would be waived as they have been for previous FCHA projects. The City Manager is recommending that the Council waive the fees for the CARE Housing project and then deal with the policy question of continuing to waive fees for these kinds of projects at a later time. That question will be presented to Council at a work session on July 5. Attached is a memo from Julie Brewen, FCHA Director (Attachment 3), that gives FCHA’s perspective on the proposed fee waiver, as well as an explanation of how the FCHA determines, on a case-by-case basis, whether to enter into these kinds of partnerships. FINANCIAL / ECONOMIC IMPACTS For the Provincetowne project (eleven multifamily buildings; a total of 85 low income rental units), the potential financial impact of a fee waiver on City funds is $557,378. Approximately $4,762 of the fee revenue lost is Utility development review fees. Building permit and plan check fees lost total $42,720. The remaining $509,896 is comprised of Capital Expansion fees (Fire, Police, General Government, Parkland, Street Oversizing, and School fees). These figures reflect recent changes in the capital expansion and utility development review fees. Some fees were collected at the inception of this project because of the unresolved issues, and approximately $17,177 will need to be refunded if the fees are waived.” Karen Cumbo, Director of Planning, Development, and Transportation Services, discussed the proposed affordable housing project and its history as a Fort Collins Housing Authority project. The potential financial impact of a fee waiver on City funds is $557,378. Staff has explored various 345 June 7, 2011 ways of mitigating this impact, including deferral for varying periods; however, staff is recommending approval of the fee waiver. Matt Robenault, Fort Collins Housing Authority Board Chairperson, supported the fee waiver noting the project will aid in filling the need for affordable housing units. Councilmember Horak asked if this item had come before Council previously. Cumbo replied in the negative. Councilmember Horak asked for staff’s opinion regarding the source for the funds. Cumbo replied staff explored various options for covering the $500,000 in fees, such as deferring the fees for 15 years but staff never assumed Council would authorize $500,000 to backfill the fees. Councilmember Poppaw noted the Housing Authority and CARE Housing moved forward with the project in good faith based on state statute and City precedent and asked how this issue was overlooked. Cumbo replied the law and past practice indicated fee waivers should be expected and the fees are not discussed until the building permit application is submitted. Mayor Weitkunat asked if the capital expansion fees become due at the time the building permit is pulled. Cumbo replied in the affirmative. Councilmember Horak asked about the impact of Council not adopting the Ordinance. Julie Brewen, Fort Collins Housing Authority Executive Director, replied the fees not being waived would create a $500,000 funding deficit for the Housing Authority, and the project would not be able to support the debt with the restricted rents and would be in default. A deferral of fees would work strictly from a Housing Authority risk standpoint; however, that would leave CARE Housing with some potential problems with refinancing at year 15 and beyond. Councilmember Horak asked about the impact of postponing the item for a month. Cumbo replied staff could issue temporary certificates of occupancy. Brewen replied the investor, JP Morgan Chase, would likely oppose that option. Councilmember Horak asked why Council was not previously made aware of this situation. City Attorney Roy replied this began as an administrative item and remained in that category because the existing City Ordinance and state law gave the City Manager the right to waive the fees without Council action. This item will not require Council to locate an extra $500,000. Whether or not backfill is needed will come up one piece at a time depending on when a particular improvement is ready to be constructed and the timeframe within which it needs to be constructed. At that point, the monies in the fund must be adequate to fund the project or be backfilled. Councilmember Manvel asked if the Housing Authority has the $1.4 million guarantee amount. Brewen replied the Housing Authority and CARE Housing have the amount in equity at other properties but utilizing that would put other properties at risk. The money that has already been expended has come from construction loans. JP Morgan Chase is the investor as well as the lender. 346 June 7, 2011 Mayor Weitkunat noted Fort Collins has established an affordable housing policy based on the need in the community; part of which includes fee waivers for the Fort Collins Housing Authority. Councilmember Troxell asked for information about the project itself. Cumbo replied there are 85 units in eleven buildings. Councilmember Troxell asked how much of the project is being financed. Jeff Johnson, attorney for CARE Housing, replied JP Morgan Chase is involved as a tax credit investor and is bringing about $5.2 million in equity to the $14 million project. Councilmember Troxell asked when the project is set to be completed. Brewen replied it will be completed by October. Cumbo replied all of the building permits have been issued. Mayor Pro Tem Ohlson stated he would not support the Ordinance based on the process and encouraged fellow Councilmembers to vote against items that seem to force Council to vote for them at the last minute. He asked if it is a requirement to waive the fees, given the fact that the Housing Authority is a very minimal partner. Councilmember Poppaw noted staff’s presumption was that state statute and City policy were to be followed. These types of projects will not occur without fee waivers. City Attorney Roy stated Council is not absolutely bound to waive the fees. The state statute relating to impact fees states “the City may waive fees for affordable housing.” Another statute states that housing authorities are exempt from both fees and taxes and projects in which a housing authority has an interest are also exempt from taxes. Therefore, it is unclear whether projects not entirely owned by the Housing Authority are exempt from fees. The City Code speaks to fee waivers for Housing Authority projects, leaving this to Council interpretation. Councilmember Poppaw asked if the attorney for the Housing Authority could respond. Brewen stated that last two large Housing Authority projects were tax credit acquisition rehab deals and both had fee waivers. In both instances, the Housing Authority was 0.01% owner, as is the case in this project. Mr. James Martell, attorney for the Housing Authority, replied CARE Housing will receive $5.2 million in equity at the end of 15 years; therefore the benefit of the small ownership percentage is large. This ownership configuration minimizes the liability to the Housing Authority, still achieves the tax credits, and gains the benefit of the equity at the end of 15 years. Councilmember Manvel asked how the ownership would be divided at the end of 15 years in terms of equity interest. Martell replied that is unclear as the rents cannot increase; however, expenses can increase. At the end of 15 years, the equity would likely go back to CARE Housing. Affordability of the units is guaranteed for 40 years. Councilmember Troxell asked about the ability to backfill funds. City Manager Atteberry noted this item was not required to come before Council; however, staff opted to place it on Council’s agenda because of the large dollar amount and would not consider waiving fees to such an extent without 347 June 7, 2011 Council approval. Cumbo replied staff has explored some options for backfill. There are options, from a procedural standpoint, which will keep the City out of this situation in the future. Councilmember Manvel made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 071, 2011, on First Reading. Councilmember Manvel stated there are two possible consequences of not adopting this Ordinance: a negative $500,000 appropriation to the Housing Authority and the possible end to this project. He stated process changes are necessary. Councilmember Poppaw agreed with Councilmember Manvel in terms of the process; however, this project was started with good intentions. Councilmember Horak supported affordable housing but expressed disappointment with the process. Mayor Pro Tem Ohlson stated he would not support the Ordinance given the process in which it came before Council. Councilmember Troxell stated he would like to explore how these projects can be funded through rational and deliberate means. City Manager Atteberry stated this item could be discussed at a work session on June 14 or June 28, both prior to Second Reading. Mayor Pro Tem Ohlson noted policy changes would not be made prior to Second Reading and asked what information could come of a work session that would aid in Second Reading votes. Councilmember Horak replied outreach should occur and Council should be able to give some direction as to fee waivers in the future. Councilmember Poppaw asked if staff would be prepared to do a work session on this item in a week and whether or not there is a need to rush the work session prior to Second Reading. Councilmember Poppaw asked if another similar issue would be coming before Council prior to the work session on the topic. Cumbo replied there is a senior housing project which just received its low-income tax credit approval; however, building permits have not been issued. Councilmember Kottwitz expressed support for the project and encouraged public transportation connectivity to the area. Mayor Pro Tem Ohlson reiterated his opposition to items coming before Council in a hurried manner. The vote on the motion was as follows: Yeas: Weitkunat, Kottwitz, Manvel, Poppaw, Horak and Troxell. Nays: Ohlson. THE MOTION CARRIED. 348 June 7, 2011 (**Secretary’s note: The Council took a brief recess at this point in the meeting.) (**Secretary’s note: Councilmember Kottwitz left at this point in the meeting.) Ordinance No. 074, 2011, Appropriating Funds From the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce, Adopted on First Reading The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY The Fort Collins Urban Renewal Authority (URA) is seeking a loan from the City to reimburse Kaufman and Robinson, Inc (KRI) for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance fund to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission.” On June 2 2009, the URA Board approved a Redevelopment Agreement between the URA and KRI to provide financial assistance through reimbursement for a new building project at 1330 Blue Spruce Drive. The obligation was to reimburse up to $215,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. On December 1, 2009, the URA Board approved a revised Redevelopment Agreement between the URA and KRI to provide additional financial assistance through reimbursement for green building components added to the new building project at 1330 Blue Spruce Drive. The original obligation was to reimburse up to $215,000 and was increased by $54,000 for green building features, bringing the maximum amount to $269,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. 349 June 7, 2011 Exhibit C from the Redevelopment Agreement lists the public improvements included as total eligible costs (Attachment 1). FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan, as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $600,000. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board to Kaufman and Robinson. URA funding for the Project totals $192,891. This loan is a five year term loan, with the first four years interest only payments and the remaining balance paid in year five.” Christina Vincent, Urban Renewal Authority Redevelopment Program Administrator, discussed the Kaufman and Robinson project, which did include some features from the LEED Certification rating system and a great deal of waste diversion. This is a business retention and expansion effort on the part of the Urban Renewal Authority. Mayor Pro Tem Ohlson asked about the reduction in loan amount request relating to the chilled water system. Vincent replied Kaufman and Robinson opted not to do the chilled water system, thus lowering the project cost. Mayor Pro Tem Ohlson asked how 2.4 tons of drywall was reused. Vincent replied a contract vendor was hired to remove the drywall from the site. Mayor Pro Tem Ohlson asked for information regarding the end use of the drywall. Vincent replied she would return with that information. Councilmember Horak made a motion, seconded by Councilmember Troxell, to adopt Ordinance No. 074, 2011, on First Reading. Councilmember Manvel supported the project and the Urban Renewal Authority’s role. Councilmember Troxell supported the project and its efforts incorporating LEED certification items. Mayor Pro Tem Ohlson supported the project but encouraged changing environmental aspects of future projects to be more heavily monitored. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 350 June 7, 2011 Ordinance No. 075, 2011, Appropriating Funds from the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Second Loan for the North College Marketplace Project, Adopted on First Reading The following is staff’s memorandum on this item. “EXECUTIVE SUMMARY The Urban Renewal Authority (URA) is seeking a loan in the amount of $3 million from the City to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins’ General reserves to the URA will be $3 million and reimbursed to the project for the On-Site public improvements. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance fund to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission.” On September 16, 2008 the URA Board approved Resolution No. 011, authorizing a Redevelopment Agreement between the URA and the developer to provide financial assistance for the North College Marketplace. It was determined at that time that the URA would need to borrow the funds to pay for the public improvements and then bond against that amount in the future. The City loaned the URA funds in the amount of $5 million on April 21, 2009 for those public improvements associated with the first three line items of Exhibit C of the Redevelopment Agreement (Attachment 1). Below are the line items listed in Exhibit C for the initial appropriation of $5 million: Off Site Street Infrastructure $ 2,812,620 Demolition, Property Clean up and Site Preparation Cost $ 66,650 Wetlands Mitigation, Landscaping, Unsuitable Materials and Payment to the Wetlands’ Reserve Fund $ 1,763,20 Contingency (initial amount) $ 57,524 $5,000,000 351 June 7, 2011 he remaining line items listed in Exhibit C are requested for this appropriation of $3 million: On Site Utilities (Sanitary, Storm, Water, Dry) $1,022,861 Gateway/Landscaping/Pedestrian Connection/Grading/ North South Circulation and College Avenue Public Access Easement/Paving of Grape Street $1,702,128 Relocation Assistance (Up to 1,000 per residence) $ 10,000 Contingency (remaining) $ 265,011 $3,000,000 Exhibit C from the Redevelopment Agreement lists the public improvements included as potential eligible costs (Attachment 1). FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $15.5 million in property tax increment. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board for the North College Marketplace. URA funding for the Project’s second appropriation amount totals $3,000,000. This loan is a 20- year term loan.” Christina Vincent, Urban Renewal Authority Redevelopment Program Administrator, stated this Ordinance would appropriate the final $3 million of the original $8 million and will pay for the eligible public improvements that were not associated with the first $5 million. This loan will have an 18-year term with no pre-payment penalty and a total interest payment to the City of $1.3 million. Mayor Pro Tem Ohlson asked about discrepancies between cost estimates and actual costs. Vincent replied the first $5 million was the appropriated amount to spend; however, the development exceeded that amount and brought in receipts proving additional expenses. The language in the redevelopment agreement allowed only the first $5 million to be submitted prior to a Certificate of Occupancy being obtained. As that has occurred, the additional receipts may be submitted to encompass the $3 million. Off-site street infrastructure improvements which were part of the first $5 million were transferred to the City’s Engineering Department and receipts were checked there. Mayor Pro Tem Ohlson asked for assurance, prior to Second Reading, that the Engineering Department provides the same level of scrutiny to receipts as does the URA. Councilmember Manvel asked about the possibility of $900,000 coming back from future developers. Vincent replied that estimate was made in 2008 and was based on the possibility of additional redevelopment paying back the local street portion that was funded for properties adjacent to the project. 352 June 7, 2011 Councilmember Horak made a motion, seconded by Councilmember Troxell, to adopt Ordinance No. 075, 2011, on First Reading. Councilmember Manvel encouraged a discussion regarding the effect of these types of large loans on the General Fund and City reserves. Mike Freeman, Chief Financial Officer, replied the Finance Committee is scheduled to do a complete cash flow analysis through the end of the Urban Renewal Authority term based on existing projects. John Voss, Interim Finance Director, replied the minimum reserve fund balance, established by policy, is 60 days of annual expenditures, which is approximately $17 million. These two actions will take $3.2 million out of the existing $19.3 million resulting in a balance $900,000 below the $17 million threshold. Sales tax is anticipated to come in over budget in 2011 which will offset that amount. Mayor Pro Tem Ohlson expressed concern General Fund reserves will be too depleted given this project and the Discovery Science Center project, coming before Council shortly. He asked why the Utility reserves are not being used to fund this project. Freeman replied there are legal concerns as to whether or not the Utility reserves can loan dollars for interfund loans. City Attorney Roy replied he would return to Council with a legal perspective. Mayor Pro Tem Ohlson asked if the possibility of getting the money from a different reserve fund could be explored prior to Second Reading. City Manager Atteberry replied in the affirmative. City Manager Atteberry asked staff to respond to Mayor Pro Tem Ohlson’s concerns regarding borrowing from the General Fund reserves. Freeman replied staff would not make a recommendation to borrow from the General Fund reserves should there be a concern it would put the reserves in peril. The URA area is just now getting substantial projects that create tax increment; therefore, repayment is a timing issue rather than an ability to repay issue. The repayment of these loans with interest is substantially higher than interest would be on the free market. Mayor Pro Tem Ohlson expressed concern there are zero General Fund dollars available to provide positive services for the community and opposed the piecemeal approach to borrowing from the reserves. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Ordinance No. 064, 201, Appropriating Unanticipated Grant Revenue and Prior Year Reserves In the Capital Projects Fund for the North College Avenue Improvements - Vine Drive to Conifer Project and Approving a Related Reimbursement Agreement and Promissory Note, Adopted on Second Reading The following is staff’s memorandum for this item. 353 June 7, 2011 “EXECUTIVE SUMMARY The limits of this phase of the North College Improvement Project are from Vine Drive to the Hickory/Conifer intersection. Improvements will include a two inch asphalt overlay, the construction of various urban design elements, an eight foot on-street bike lane, a landscaped parkway, shared use paths, the definition and consolidation of accesses throughout the corridor, an updated storm system including water quality treatment ponds, and safety improvements at the Conifer/Hickory Intersection. The total project budget of $11.19 million includes $2.7 million from residual funds available from the Building on Community Choices (BCC) Tax Initiative of 1997. This Ordinance, unanimously adopted on First Reading on May 17, 2011, appropriates $1,001,000 in additional grant funds received from the Colorado Department of Transportation and $2.7 million from prior year reserves in the Capital Projects Fund, Building Community Choices reserves for expenditure on this Project. The residual BCC funds appropriated are to be repaid to the City of Fort Collins by the Urban Renewal Authority (URA). Due to the timing of the improvements, the URA contributions will not be available at the start of construction. The total appropriation of $11,186,000 will allow the project to be constructed to the full project limits from Vine Drive to Conifer as outlined in the Building on Basics (BOB) 2005 Tax Initiative. On second reading, at request of Councilmember Horak and with the approval of the Leadership Planning Team, staff has prepared an optional version of the ordinance for Council’s consideration. The revised ordinance would formalize the Urban Renewal Authority’s obligation to repay the City for the $2.7 million contribution from the Building Community Choices reserve fund by authorizing the execution of a Reimbursement Agreement with the URA and a corresponding promissory note. If this version of the ordinance is approved by the City, the URA Board would approve the same agreement and note.” Rick Richter, Engineering and Capital Projects Manager, discussed the proposed roadway improvements. City Attorney Roy stated the revised Ordinance better ensures the repayment of the $2.7 million through the execution of a reimbursement agreement and a promissory note. He read the revised portions of the Ordinance into the record. Councilmember Troxell made a motion, seconded by Councilmember Poppaw, to adopt Ordinance No. 064, 2011 as amended, on Second Reading. Councilmember Manvel asked how the interest rate for the promissory note will be determined. Mike Freeman, Chief Financial Officer, replied the estimate for the interest rate is 3.92% based on the Treasury Bill. Councilmember Horak supported the placement of a loan agreement. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARREID. 354 June 7, 2011 Other Business Councilmember Troxell asked about the impact of pine beetles on urban forests and how the City’s Forestry Department is handling the issue. City Manager Atteberry stated a response may have been provided by the City Forester a few months ago; if not, a service area request will be submitted. Mayor Pro Tem Ohlson asked about the possibility of getting a policy change to stop the City from using corn-based ethanol. City Manager Atteberry replied an immediate change would be difficult given agreements with other entities and investments in facilities. An extensive white paper was distributed months ago and will be resurfaced to include the impacts of immediately ceasing use and phasing out use. The issue can be brought before Council for a decision. Councilmember Troxell asked if this also includes E85,. Adjournment Mayor Weitkunat adjourned the meeting until the conclusion of the Urban Renewal Authority meeting. (Council adjourned to the conclusion of the Urban Renewal Authority Meeting and reconvened at 10:00 p.m.) Executive Session Authorized Mayor Pro Tem Ohlson made a motion, seconded by Councilmember Manvel, to go into Executive Session as authorized by Section 2-31(a)(2) and Section 2-31(a)(3) of the City Code, for the purpose of discussing the possible disposition of interests in real property and related legal issues. Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. The meeting adjourned at 10:45 p.m. _________________________________ Mayor ATTEST: _____________________________ City Clerk 355 DATE: July 5, 2011 STAFF: Bev Gast AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 7 SUBJECT Second Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. EXECUTIVE SUMMARY This Ordinance, unanimously adopted on First Reading on June 7, 2011, appropriates unanticipated Cultural Development and Programming (“CDP”) revenue and prior year reserves for the CDP accounts and prior year reserves for the Convention and Visitors Bureau. Lodging tax revenues in 2010 were $22,252 short of revenue projections; however, there are Lodging tax reserves from unspent appropriations in the amount of $113,066 available to be appropriated in the General Fund. In addition, $2,800 of unanticipated CDP revenue was received in 2011 which will be appropriated into the Cultural Development and Programming accounts. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Bev Gast AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 11 SUBJECT First Reading of Ordinance No. 065, 2011, Appropriating Prior Year Reserves and Unanticipated Revenue in the General Fund for Cultural Development and Programming Activities and the Fort Collins Convention and Visitors Bureau. EXECUTIVE SUMMARY This Ordinance appropriates unanticipated Cultural Development and Programming (“CDP”) revenue and prior year reserves for the CDP accounts and prior year reserves for the Convention and Visitors Bureau. Lodging tax revenues in 2010 were $22,252 short of revenue projections; however, there are Lodging tax reserves from unspent appropriations in the amount of $113,066 available to be appropriated in the General Fund. In addition, $2,800 of unanticipated CDP revenue was received in 2011 which will be appropriated into the Cultural Development and Programming accounts. BACKGROUND / DISCUSSION Section 25-244 of the City Code requires that 75% of the total lodging tax receipts are to be used for the promotion of convention and visitor activities and 25% for cultural development and programming activities. Actual revenue collected is appropriated based on this allocation formula and any excess revenue as well as budget savings are reserved by these activities in the General Fund balance. FINANCIAL / ECONOMIC IMPACTS Visitor Events CDP1 CDP2 CVB Total General Fund Prior Year Reserves $65,585 $31,172 $16,309 $113,066 Unanticipated 2011 Revenue 2,800 0 0 2,800 Total to be Appropriated $68,385 $31,172 $16,309 $115,866 STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION The City’s Cultural Resources Board reviews applications for these funds and makes recommendations to the City Council. This fund support events that provide a public benefit to the Fort Collins community, and promotes the utilization of public accommodations within the City. ORDINANCE NO. 065, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING PRIOR YEAR RESERVES AND UNANTICIPATED REVENUE IN THE GENERAL FUND FOR CULTURAL DEVELOPMENT AND PROGRAMMING ACTIVITIES AND THE FORT COLLINS CONVENTION AND VISITOR’S BUREAU WHEREAS, Section 25-244 of the City Code requires that lodging tax revenue is to be allocated as follows: 75% for the promotion of convention and visitor activities and 25% for cultural development and programming activities; and WHEREAS, the Cultural Development and Programming (CDP1) account had prior year funds in the amount of $65,585 that were not expended in 2010; and WHEREAS, the Visitor Events (CDP2) account had funds from prior years in the amount of $31,172 that were not expended in 2010; and WHEREAS, the Convention and Visitor’s Bureau account had funds from prior years in the amount of $16,309 that were not expended in 2010; and WHEREAS, at the end of 2010, all of the lodging tax funds described above lapsed into the General Fund Reserves for lodging taxes; and WHEREAS, during 2011, unanticipated revenue of $2,800 has been collected for Cultural Development and Programming Activities; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated; and WHEREAS, Article V, Section 9 of the City Charter permits the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year: and WHEREAS, City staff has determined that the appropriation of the revenue as described herein will not cause the total amount appropriated in the General Fund to exceed the current estimate of actual and anticipated revenues to be received in that fund during any fiscal year; and WHEREAS, the City wishes to appropriate all funds allocated for Cultural Development and Programming, Visitor Events and the Convention and Visitor’s Bureau. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated for expenditure from prior year reserves in the General Fund the total sum of SIXTY-FIVE THOUSAND FIVE HUNDRED EIGHTY-FIVE DOLLARS ($65,585) for Cultural Development and Programming. Section 2. That there is hereby appropriated for expenditure from prior year reserves in the General Fund the total sum of THIRTY-ONE THOUSAND ONE HUNDRED SEVENTY-TWO DOLLARS ($31,172) for Visitor Events. Section 3. That there is hereby appropriated for expenditure from prior year reserves in the General Fund the total sum of SIXTEEN THOUSAND THREE HUNDRED NINE DOLLARS ($16,309) for the Convention and Visitor’s Bureau. Section 4. That there is hereby appropriated for expenditure from unanticipated revenue in the General Fund the total sum of TWO THOUSAND EIGHT HUNDRED DOLLARS ($2,800) for Cultural Development and Programming. Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk DATE: July 5, 2011 STAFF: Helen Matson Glen Schlueter AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 8 SUBJECT Second Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non- Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. EXECUTIVE SUMMARY Larimer County has a current construction project at the Larimer County Detention Center Campus, located on Midpoint Drive. This project includes an Alternative Sentencing Division building, an addition to the existing Sheriff’s Administration building, and an addition to the existing Community Corrections Facility. In addition, there will be parking lot modifications and site improvements. With these changes, the project will include an on-site detention pond. This Ordinance, unanimously adopted on First Reading on June 7, 2011, will grant a permanent utility easement for a 30-inch underground stormwater pipe to convey the detained runoff to Skunk Pond, which is part of Prospect Ponds Natural Area. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Helen Matson Glen Schlueter AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 12 SUBJECT First Reading of Ordinance No. 067, 2011, Authorizing the Conveyance to Larimer County of a Permanent Non- Exclusive Storm Drainage Easement on City Wastewater Utility Property Including a Portion of Prospect Ponds Natural Area. EXECUTIVE SUMMARY Larimer County has a current construction project at the Larimer County Detention Center Campus (LCDC) located on Midpoint Drive. This project includes an Alternative Sentencing Division building, an addition to the existing Sheriff’s Administration building, and an addition to the existing Community Corrections Facility. In addition, there will be parking lot modifications and site improvements. With these changes, the project will include an on-site detention pond. To handle the drainage from the site, Larimer County is requesting that the City grant a permanent utility easement for a 30-inch underground stormwater pipe to convey the detained runoff to Skunk Pond, which is part of Prospect Ponds Natural Area. BACKGROUND / DISCUSSION The City of Fort Collins Utilities acquired the property known as Prospect Ponds Natural Area in 1976. The Natural Resources Department manages Prospect Pond Natural Area, which includes Skunk Pond. In 2002, the Utilities purchased Lot 34 and Tract A of Prospect Industrial Park. The Utilities purchased these parcels to be a buffer for the Drake Water Reclamation Facility. The portion of the easement that runs under Tract A contains 15,650 square feet and the portion of the easement for the property managed by Natural Areas at Skunk Pond contains 1,773 square feet. The proposed detention pond on the LCDC campus is being designed to detain and release at a rate that is equal to only the onsite basin historic release rate for the 2-year storm and 100-year storm. The detained runoff from the LCDC campus will be conveyed in an underground 30-inch pipe in a southeasterly direction at the rear of the Prospect Industrial Park properties. There is currently a drainage channel in this location and the proposed pipe will be located at the center of the channel. At the south end of this drainage channel, the pipe will turn northwesterly under Tract A, Prospect Industrial Park and will outlet at Skunk Pond. FINANCIAL / ECONOMIC IMPACTS The improvements Larimer County is constructing at the LCDC campus serve a public purpose for the citizens of Fort Collins. Due to this public purpose, staff is recommending that the City not charge Larimer County for this easement request. Real Estate Services has determined that the value of this donated easement is $1,050. In addition, the waived processing fees from Real Estate Services and Natural Resources are $1,500. ENVIRONMENTAL IMPACTS Tract A of Prospect Industrial Park is currently improved as a gravel road. The portion of Prospect Ponds Natural Area that will be impacted is dominated by non-native vegetation and therefore, the County will not be required to pay restoration fees. Once the outlet pipe is constructed, the County’s contractor will replace the topsoil and seed with native grasses. COPY COPY COPY COPY June 7, 2011 -2- ITEM 12 STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION At its May 11, 2011 meeting, the Land Conservation and Stewardship Board unanimously agreed to recommend that City Council approve the requested easement to Larimer County. At its May 26, 2011 meeting, the Water Board unanimously recommended Council approve the easement request from Larimer County. ATTACHMENTS 1. Location Map 2. Photo of Area of Impact at Skunk Pond 3. Land Conservation and Stewardship Board minutes, May 11, 2011 4. Water Board minutes, May 26, 2011 ORDINANCE NO. 067, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CONVEYANCE TO LARIMER COUNTY OF A PERMANENT NON-EXCLUSIVE STORM DRAINAGE EASEMENT ON CITY WASTEWATER UTILITY PROPERTY INCLUDING A PORTION OF PROSPECT PONDS NATURAL AREA WHEREAS, the City owns a parcel of land described as Tract “A”, Prospect Ponds Industrial Park, and an adjacent parcel that is managed as Prospect Ponds Natural Area (together referred to as “the Property”); and WHEREAS, the Property was purchased by the City’s Wastewater Utility to provide a buffer for the Drake Water Reclamation Facility, and a portion of it is managed by Natural Areas in order to minimize the costs to the Wastewater Utility of owning and maintaining the Property; and WHEREAS, Larimer County (the “County”) is in the process of developing improvements to the existing Larimer County Detention Center campus (“LCDC”), located on Midpoint Drive, including on-site detention for storm drainage from the LCDC; and WHEREAS, stormwater on the LCDC site is currently held in a retention pond, and in connection with its development of new improvements, the County will install a detention pond and construct a 30-inch underground pipe to convey the stormwater flows away from LCDC, in a manner consistent with City standards for management of stormwater; and WHEREAS, as part of this project, the County has requested a permanent, non-exclusive easement approximately 17,400 square feet in area on the Property, for its underground stormwater pipe and for the outlet of stormwater flows from the pipe into Skunk Pond, which is located on the Property (the “Easement’); and WHEREAS, the location of the proposed Easement is shown and described on Exhibit “A”, [Exhibit “A” is on file in the office of the City Clerk] and incorporated herein by this reference (the “Easement Area”); and WHEREAS, City staff has evaluated the potential impacts of the proposed Easement, and has concluded that the Easement would not interfere with the City’s intended use of the Property, either as part of the natural area system, or as part of the City’s wastewater system; and WHEREAS, due to the public safety purposes to be served by the County’s LCDC improvements, and the City’s direct interest in promoting these purposes, staff is recommending that no fees or compensation be charged in connection with the proposed Easement; and WHEREAS, at its regular meeting on May 11, 2011, the Land Conservation and Stewardship Board reviewed the proposed Easement and recommended that the City Council authorize the conveyance of it; and WHEREAS, at its regular meeting on May 26, 2011, the Water Board reviewed the proposed Easement and also recommended that the City Council authorize conveyance of it; and WHEREAS, Section 23-111(a) of the City Code provides that the City Council is authorized to sell, convey, or otherwise dispose of any and all interests in real property owned by the City, provided that the City Council first finds, by ordinance, that such sale or other disposition is in the best interest of the City; and WHEREAS, with respect to property that is a part of the City’s water or utility systems, Section 23-111(b) of the City Code requires that the City Council also find that the disposition will not materially impair the viability of the particular utility system as a whole and that it will be for the benefit of the citizens of the City. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the conveyance of the Easement, as set forth herein, is in the best interests of the City, will not impair the viability of the wastewater system, and will be for the benefit of the citizens of the City. Section 2. That the Mayor is hereby authorized to execute a deed of easement conveying the Easement on such terms and conditions as the City Manager, in consultation with the City Attorney, determines to be necessary or appropriate to protect the interests of the City, including, but not limited to, any necessary changes to the legal description of the Easement, as long as such changes do not materially increase the size or change the character of the Easement. Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -2- Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Helen Matson Mark Sears AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 9 SUBJECT Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. Second Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. Second Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. EXECUTIVE SUMMARY Ordinance No. 068, 2011, authorizes the donation of a 1.75 acre parcel along the Poudre River from Larimer County to the City Natural Areas Program. The property is located adjacent to the north end of Arapaho Bend Natural Area. Ordinance No. 069, 2011 authorizes the donation of a three acre parcel located adjacent to Running Deer Natural Area, south of East Prospect Road, from Mike Sollenberger to the City Natural Areas Program. Both Ordinances were unanimously adopted on First Reading on June 7, 2011. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Helen Matson Mark Sears AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 13 SUBJECT Items Relating to Approval and Appropriation of Two Real Property Land Donations to the Natural Areas Program. A. First Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. B. First Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. EXECUTIVE SUMMARY Larimer County would like to transfer the ownership and management of a 1.75 acre parcel along the Poudre River and located adjacent to the north end of Arapaho Bend Natural Area to the City Natural Areas Program (NAP). Mike Sollenberger has agreed to donate the three acre parcel located adjacent to Running Deer Natural Area, south of East Prospect Road to the NAP. BACKGROUND / DISCUSSION A. First Reading of Ordinance No. 068, 2011, Authorizing the Acceptance of a Donation of 1.75 Acres From Larimer County and Appropriating Unanticipated Revenue in the Natural Areas Fund. Larimer County acquired the 1.75 acre parcel along the Poudre River in February 1976. The County constructed a small parking lot at the east end of Horsetooth Road on a portion of abandoned road right-of-way, which is now the north parking lot for Arapaho Bend, and constructed a pedestrian bridge and a trail to provide access from the parking lot to the historic Strauss Cabin. It provided an interpretive sign at the cabin to inform the public about the history of the cabin. In 1999, Strauss Cabin was burned down by arsonists and the property has been closed to the public ever since. The foundation and stone walls of the cabin are all that remain. They are currently fenced to prevent further vandalism and to protect the public from any unsafe conditions. Since the City’s Natural Areas Program owns the Arapaho Bend Natural Area (ABNA) adjacent and south of the Strauss Cabin property, the transfer of the ownership of this parcel will benefit both programs. It is an awkward piece of property for the County to manage and since it is adjacent to ABNA it is, in essence, already being managed by the City and would not be a significant expense for the NAP to manage as a part of ABNA. A portion of the future Poudre River trail may go through or near the Strauss Cabin property, through the ABNA, under I-25 and connect to the Town of Timnath’s segment of the Poudre River trail, providing more public access to this historic area. Natural Areas will consider opening up the existing trail to Strauss Cabin and providing interpretive signage about the history of the cabin and the Council Tree, located nearby. B. First Reading of Ordinance No. 069, 2011, Authorizing the Acceptance of a Donation of Three Acres from Mike Sollenberger and Appropriating Unanticipated Revenue in the Natural Areas Fund. Mike Sollenberger acquired the three acre parcel from the previous owner of Running Deer Natural Area for the purpose of wetlands mitigation. He successfully established a wetland on this parcel and has completed his obligation to the Corps of Engineers. The NAP will continue to manage the site as a wetland and will work to maintain and enhance the quality of the wetland. Since Natural Areas owns the adjacent property, Running Deer Natural Area, the transfer of its ownership will benefit the NAP and will only slightly increase the NAP maintenance costs. COPY COPY COPY COPY June 7, 2011 -2- ITEM 13 FINANCIAL / ECONOMIC IMPACTS Both of these donated parcels are adjacent to established natural areas, which minimizes the maintenance costs for each. Real Estates Services has established the value of each of these parcels and this value is $5,000 per acre. The value for the parcel owned by Larimer County is $8,400. The value for the parcel owned by Mike Sollenberger is $15,000. ENVIRONMENTAL IMPACTS Both of these parcels will be maintained by Natural Resources as the adjacent natural area is maintained. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. BOARD / COMMISSION RECOMMENDATION At its April 13, 2011 meeting, the Land Conservation and Stewardship Board unanimously recommended that City Council approve the 1.75 acre Strauss Cabin parcel donation from Larimer County and the three acre parcel donation from Mike Sollenberger. ATTACHMENTS 1. Location Maps for Larimer County Property Donation and Sollenberger Property Donation 2. Land Conservation and Stewardship Board minutes, April 13, 2011 ORDINANCE NO. 068, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE ACCEPTANCE OF A DONATION OF 1.75 ACRES OF LAND FROM LARIMER COUNTY AND APPROPRIATING UNANTICIPATED REVENUE IN THE NATURAL AREAS FUND WHEREAS, in 1976, Larimer County acquired a 1.75 acre parcel along the Poudre River, the legal description of which is attached hereto as Exhibit “A” [Exhibit “A” is on file in the office of the City Clerk] and incorporated herein by this reference (the “Property”), that is located adjacent to the north end of the Arapaho Bend Natural Area; and WHEREAS, the Property contains the foundation and stone walls of the historic Strauss Cabin; and WHEREAS, the Natural Areas Fund owns and manages the Arapaho Bend Natural Area that is adjacent to and south of the Property; and WHEREAS, Larimer County desires to donate the Property to the City’s Natural Areas Program; and WHEREAS, the value of the Property is estimated to be $8,400; and WHEREAS, it would not be a significant expense for the Natural Areas Program to manage the Property as part of the Arapaho Bend Natural Area; and WHEREAS, City staff has determined that the donation of the Property by Larimer County will assist the City in meeting its goals for natural areas programs; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year does not exceed the then current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, City staff has determined that the appropriation of the donated land, as described herein, will not cause the total amount appropriated in the relevant funds to exceed the current estimate of actual and anticipated revenues to be received in that fund during the fiscal year; and WHEREAS, it is the desire of the City Council to authorize the acceptance of the donation of the Property from Larimer County and to appropriate $8,400 of unanticipated revenue in the form of a donation of land in the Natural Areas Fund. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby approves and authorizes the acceptance by the Mayor of a deed of conveyance of the Property for the Natural Areas Program. Section 2. That there is hereby appropriated for expenditure from unanticipated revenue in the Natural Areas Fund the sum of EIGHT THOUSAND FOUR HUNDRED DOLLARS ($8,400) for Natural Areas Program purposes. Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk ORDINANCE NO. 069, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE ACCEPTANCE OF A DONATION OF THREE ACRES OF LAND FROM MIKE SOLLENBERGER AND APPROPRIATING UNANTICIPATED REVENUE IN THE NATURAL AREAS FUND WHEREAS, on April 11, 2001, a local citizen, Mike Sollenberger (“Sollenberger”), acquired a 3.0 acre parcel, the legal description of which is attached hereto as Exhibit “A” [Exhibit “A” is on file in the office of the City Clerk] and incorporated herein by this reference (the “Property”), from the previous owner of what is now the Running Deer Natural Area, for the purpose of establishing a wetlands mitigation project; and WHEREAS, Sollenberger has provided documentation to the City from the U.S. Army Corps of Engineers indicating that the wetlands mitigation project is complete; and WHEREAS, Sollenberger desires to donate the Property to the City’s Natural Areas Program; and WHEREAS, the value of the Property is estimated to be $15,000; and WHEREAS, City staff has determined that the donation of the Property by Sollenberger will assist the City in meeting its goals for natural areas programs and will not significantly increase the Natural Areas Program maintenance costs; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year does not exceed the then current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, City staff has determined that the appropriation of the donated land, as described herein, will not cause the total amount appropriated in the relevant funds to exceed the current estimate of actual and anticipated revenues to be received in that fund during the fiscal year; and WHEREAS, it is the desire of the City Council to authorize the acceptance of the donation of the Property from Sollenberger and to appropriate $15,000 of unanticipated revenue in the form of a donation of land in the Natural Areas Fund. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby approves and authorizes the acceptance by the Mayor of a deed of conveyance of the Property for the Natural Areas Program. Section 2. That there is hereby appropriated for expenditure from unanticipated revenue in the Natural Areas Fund the sum of FIFTEEN THOUSAND DOLLARS ($15,000) for Natural Areas Program purposes. Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk DATE: July 5, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 10 SUBJECT Second Reading of Ordinance No. 074, 2011, Appropriating Funds From the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce. EXECUTIVE SUMMARY This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan from the City to the Urban Renewal Authority (URA) to reimburse Kaufman and Robinson, Inc for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 22 SUBJECT First Reading of Ordinance No. 074, 2011, Appropriating Funds From the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Loan for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce. EXECUTIVE SUMMARY The Fort Collins Urban Renewal Authority (URA) is seeking a loan from the City to reimburse Kaufman and Robinson, Inc (KRI) for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance fund to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission.” On June 2 2009, the URA Board approved a Redevelopment Agreement between the URA and KRI to provide financial assistance through reimbursement for a new building project at 1330 Blue Spruce Drive. The obligation was to reimburse up to $215,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. On December 1, 2009, the URA Board approved a revised Redevelopment Agreement between the URA and KRI to provide additional financial assistance through reimbursement for green building components added to the new building project at 1330 Blue Spruce Drive. The original obligation was to reimburse up to $215,000 and was increased by $54,000 for green building features, bringing the maximum amount to $269,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. Exhibit C from the Redevelopment Agreement lists the public improvements included as total eligible costs (Attachment 1). FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan, as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $600,000. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board to Kaufman and Robinson. URA funding for the Project totals $192,891. This loan is a five year term loan, with the first four years interest only payments and the remaining balance paid in year five. COPY COPY COPY COPY June 7, 2011 -2- ITEM 22 STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. ATTACHMENTS 1. Exhibit C to the Kaufman and Robinson Redevelopment Agreement – List of estimated costs for public improvements. 2. Powerpoint presentation ORDINANCE NO. 074, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING FUNDS FROM THE CITY’S GENERAL FUND RESERVES FOR TRANSFER TO THE FORT COLLINS URBAN RENEWAL AUTHORITY FOR THE PURPOSE OF PROVIDING A LOAN FOR THE KAUFMAN AND ROBINSON, INC. PROJECT AT 1330 BLUE SPRUCE WHEREAS, the Fort Collins Urban Renewal Authority (the “URA”) was created on January 5, 1982 to prevent and eliminate conditions related to certain blight factors in the City; and WHEREAS, the City Council, by Resolution 2004-152, has made findings required by Colorado Revised Statutes, Part 1 of Title 31, Article 25 and declared the area described in Resolution 2004-151 as blighted and approved the Urban Renewal Plan for the North College Avenue Corridor (the “Plan”); and WHEREAS, on August 15, 2006, the City Council adopted Resolution 2006-082 authorizing an intergovernmental agreement between the City and the URA whereby the City will provide support services to the URA and will advance funds to the URA so long as the advance of such funds is evidenced in writing by a promissory note; and WHEREAS, Kaufman and Robinson, Inc. had proposed the construction of a new 10,000 square foot commercial building on a parcel of land approximately 1.76 acres in size located at 1330 Blue Spruce (the “Project”); and WHEREAS, the Project included the construction and installation of public infrastructure such as street and stormwater infrastructure improvements within the North College Urban Renewal Area; and WHEREAS, on June 2, 2009, the Board of Commissioners of the URA (the “Board”) adopted Resolution 2009-018, approving the provision of financial assistance in the amount of $215,000 for the Project; and WHEREAS, on June 2, 2009, the Board suggested that additional financial support might be considered if more green building technologies were incorporated in the Project; and WHEREAS, on December 1, 2009, the Board adopted Resolution 2009-022 approving up to an additional $54,000 in financial assistance due to additional green building technologies that were being added to the Project; and WHEREAS, the Project has been completed; and WHEREAS, the total cost of the Project is $1,600,000 and the cost of the public infrastructure improvements is $192,891; and WHEREAS, the URA will not have sufficient tax increment revenues in 2011 to fund its contribution to the Project; and WHEREAS, City staff recommends that the City lend the URA the funds needed for that purpose; and WHEREAS, staff has prepared a proposed promissory note (the “Note”) and loan agreement entitled “Loan Agreement Between the City of Fort Collins and the Fort Collins Urban Renewal URA for the Kaufman and Robinson, Inc. New Building at 1330 Blue Spruce Project” (the “Loan Agreement”) attached hereto as Exhibit “A” [Exhibit “A” is on file in the office of the City Clerk] and incorporated herein by this reference; and WHEREAS, there are sufficient prior year reserves in the City’s General Fund to fund a loan to the URA for the purpose of funding the Project street and stormwater infrastructure improvements; and WHEREAS, Article V, Section 9 of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated; and WHEREAS, the City Manager recommends funding the loan to the URA from the General Fund and it is the desire of City Council to do so. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from General Fund Reserves the sum of ONE HUNDRED NINETY TWO THOUSAND EIGHT HUNDRED NINETY ONE DOLLARS ($192,891) for expenditure as a loan to the Fort Collins Urban Renewal Authority. Section 2. That the use of this $192,891 in General Fund Reserves for the purpose of funding a loan to the URA, according to the terms and conditions of the Note and Loan Agreement, will provide necessary improvements to public infrastructure and will be beneficial for all City citizens. Section 3. That the Loan Agreement is hereby approved, and the Mayor is authorized to execute said agreement, subject to such modifications in form or substance as the Mayor may, in consultation with the City Attorney, deem desirable and necessary to protect the City’s interests. -2- Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 11 SUBJECT Second Reading of Ordinance No. 075, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Second Loan to the Fort Collins Urban Renewal Authority for the North College Marketplace Project. EXECUTIVE SUMMARY This Ordinance, unanimously adopted on First Reading on June 7, 2011, authorizes a loan in the amount of $3 million from the City to the Urban Renewal Authority (URA) to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins’ Water Fund Reserves to the URA will be $3 million and reimbursed to the project for the On-Site public improvements. Staff originally intended to request the funds from the City’s General Fund reserves however, after discussions with the Finance department, Utilities and the Attorney’s office, the request changed to the Utilities Water Fund reserves to ensure the URA was not overburdening the General Fund reserves. Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, assuming that staff-projected rate increases are implemented. The Ordinance provides that it is the Council’s intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the loan to the Water Fund to meet that need It is anticipated that the URA will issue bonds within the next few years, and in that event, the loan from the Water Fund would be repaid at that time. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 23 SUBJECT First Reading of Ordinance No. 075, 2011, Appropriating Funds from the City’s General Fund Reserves for Transfer to the Fort Collins Urban Renewal Authority for the Purpose of Providing a Second Loan for the North College Marketplace Project. EXECUTIVE SUMMARY The Urban Renewal Authority (URA) is seeking a loan in the amount of $3 million from the City to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins’ General reserves to the URA will be $3 million and reimbursed to the project for the On-Site public improvements. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance fund to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission.” On September 16, 2008 the URA Board approved Resolution No. 011, authorizing a Redevelopment Agreement between the URA and the developer to provide financial assistance for the North College Marketplace. It was determined at that time that the URA would need to borrow the funds to pay for the public improvements and then bond against that amount in the future. The City loaned the URA funds in the amount of $5 million on April 21, 2009 for those public improvements associated with the first three line items of Exhibit C of the Redevelopment Agreement (Attachment 1). Below are the line items listed in Exhibit C for the initial appropriation of $5 million: Off Site Street Infrastructure $ 2,812,620 Demolition, Property Clean up and Site Preparation Cost $ 366,650 Wetlands Mitigation, Landscaping, Unsuitable Materials and Payment to the Wetlands’ Reserve Fund $ 1,763,206 Contingency (initial amount) $ 57,524 $ 5,000,000 The remaining line items listed in Exhibit C are requested for this appropriation of $3 million: On Site Utilities (Sanitary, Storm, Water, Dry) $1,022,861 Gateway/Landscaping/Pedestrian Connection/Grading/ North South Circulation and College Avenue Public Access Easement/Paving of Grape Street $1,702,128 Relocation Assistance (Up to 1,000 per residence) $ 10,000 Contingency (remaining) $ 265,011 $3,000,000 Exhibit C from the Redevelopment Agreement lists the public improvements included as potential eligible costs (Attachment 1). COPY COPY COPY COPY June 7, 2011 -2- ITEM 23 FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $15.5 million in property tax increment. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board for the North College Marketplace. URA funding for the Project’s second appropriation amount totals $3,000,000. This loan is a 20-year term loan. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. ATTACHMENTS 1. Exhibit C to the North College Marketplace Redevelopment Agreement – List of estimated costs for public improvements. 2. Powerpoint presentation ORDINANCE NO. 075, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING FUNDS FROM THE CITY’S GENERAL FUND RESERVES APPROPRIATING PRIOR YEAR RESERVES IN THE WATER FUND FOR TRANSFER TO THE FORT COLLINS URBAN RENEWAL AUTHORITY FOR THE PURPOSE OF PROVIDING A LOAN TO THE FORT COLLINS URBAN RENEWAL AUTHORITY FOR THE NORTH COLLEGE MARKETPLACE PROJECT WHEREAS, the Fort Collins Urban Renewal Authority (the “URA”) was created on January 5, 1982 to prevent and eliminate conditions related to certain blight factors in the City; and WHEREAS, the City Council, by Resolution 2004-152, has made findings required by Colorado Revised Statutes Part 1 of Title 31, Article 25 and declared the area described in Resolution 2004-151 as blighted and approved the Urban Renewal Plan for the North College Avenue Corridor (the “Plan”); and WHEREAS, on August 15, 2006, the City Council adopted Resolution 2006-082 authorizing an intergovernmental agreement between the City and the URA whereby the City will provide support services to the URA and will advance funds to the URA so long as the advance of such funds is evidenced in writing by a promissory note; and WHEREAS, the 1908 North College, LLC (the “Developer”) owns property in the Plan area and has nearly completed the construction of the North College Marketplace on property located northeast of the intersection of North College Avenue and East Willox Lane (the “Project”); and WHEREAS, the Project included the construction and installation of public infrastructure such as street and utility improvements as well as gateway, landscaping and pedestrian improvements within the North College Urban Renewal Area; and WHEREAS, on September 16, 2008, the Board of Commissioners of the URA adopted Resolution No. 011 approving a financial assistance agreement with the Developer; and WHEREAS, the URA must borrow funds to pay for its portion of the improvements related to the Project as provided in Resolution No. 011, and has opted to borrow these funds in two phases; and WHEREAS, on May 5, 2009, the City Council adopted Ordinance No. 046, 2009, approving a loan in the amount of $5,000,000 for Phase One of the funding; and WHEREAS, City staff has been advised, and has confirmed, that the Developer is nearing completion of the Project, and the URA is therefore in need of obtaining the second phase of funding; and WHEREAS, the City Manager recommends providing this funding thethrough a loan to the URA from the General FundWater Fund Reserves and it is the desire of the City Council to appropriate the sum of $3,000,000 from General FundsWater Fund Reserves for transfer to the URA, as a loan (the “URA Loan”). WHEREAS, City staff has prepared a proposed promissory note (the “Note”) and loan agreement in the form entitled “Loan Agreement Between the City of Fort Collins and the Fort Collins Urban Renewal Authority for Funding the North College Marketplace Project (Phase Two)” (the “Loan Agreement”) attached hereto as Exhibit A and incorporated herein by this reference; and WHEREAS, Article V, Section 12, of the City Charter permits the City Council to provide direction as to the investment of City funds; and WHEREAS, while the lending of these funds does not fit within the categories of approved investments established in the Investment Policy approved by the City Council in 2008, the City Council finds that, based on the interest rate and other conditions in the Loan Agreement, the URA Loan is a suitable investment for City funds; and WHEREAS, the URA Loan will not necessitate any increase in water rates above those already projected by staff, and after investing the Water Fund reserves in the URA Loan, the Water Fund will still have a sufficient balance of reserve funds to meet reserve fund requirements, assuming that the projected rate increases are implemented; and WHEREAS, in the event that the timing of, or unanticipated need for, Water Utility capital improvements results in a need for the URA Loan funds to be restored to the Water Fund, it is the intent of the Council to provide a replacement funding source for the URA Loan; and WHEREAS, the City has funds available in its General Fund Reserves to fund the loan to the URA and finds it is in the best interests of the City to authorize execution of the Loan Agreement and certain related documents; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from GeneralWater Fund Reserves an amount not to exceed THREE MILLION DOLLARS ($3,000,000) for expenditure as a loan to the Fort Collins Urban Renewal Authority. Section 2. That the use of this sum for the purpose of funding a loan to the URA, according to the terms and conditions of the Note and Loan Agreement, will provide necessary improvements to public infrastructure and will be beneficial for all City citizens. -2- Section 3. That the Note, Loan Agreement and related documents are hereby approved on substantially the terms and conditions contained therein, subject to modifications in form or substance as the Mayor may, in consultation with the City Attorney, deem to be desirable and necessary to protect the interests of the City. Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Carol Workman AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 12 SUBJECT First Reading of Ordinance No. 076, 2011, Appropriating Unanticipated Revenue in the General Fund for the Purchase, Training and Ongoing Maintenance of the E911 and Emergency Dispatch Systems at Fort Collins Police Services Dispatch Center. EXECUTIVE SUMMARY Larimer Emergency Telephone Authority provides funds to the Fort Collins Police Services to be used for equipment and training to process E911 calls. This Ordinance appropriates those funds. BACKGROUND / DISCUSSION The Larimer Emergency Telephone Authority (LETA) collects a monthly fee from all county telephone users to purchase equipment, train users and maintain equipment used to process E911 phone calls and dispatch appropriate emergency services providers. In 2003, LETA developed a formula for the anticipated annual budget for these services for each Public Safety Answering Point (Emergency Services Dispatch Center) based on number of dispatchers and the number of E911 telephone calls received in the center. Based on the formula, LETA provides the funds to the individual centers for payment of expenses. The 2011 amount is $14,961, based on 2010 expenditures for Fort Collins Police Services. In the same manner, a formula was developed for each Public Safety Answering Point (PSAP) for Emergency Medical Dispatch (EMD) based on the number of dispatchers and the number of EMD calls handled by the center. The 2011 amount of $27,477 is based on the 2010 expenditures for EMD for the Fort Collins Police Services. FINANCIAL / ECONOMIC IMPACTS This Ordinance appropriates the funds provided to the Fort Collins Police Services by LETA to purchase equipment, train users, maintain equipment for emergency services dispatching and pay for quality assurance audits of EMD related calls. The total amount to be appropriated to these two budgets is $42,438. This funding allows for continued training for employees in the Fort Collins Police Services Dispatch Center to include annual training on Emergency Medical Dispatching and auditing use of the EMD protocols, resulting in staff that is better trained and qualified to provide services to the community. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. ORDINANCE NO. 076, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING UNANTICIPATED REVENUE IN THE GENERAL FUND FOR THE PURCHASE, TRAINING AND ONGOING MAINTENANCE OF THE E911 AND EMERGENCY DISPATCH SYSTEMS AT FORT COLLINS POLICE SERVICES DISPATCH CENTER WHEREAS, Larimer Emergency Telephone Authority (“LETA”) collects a monthly fee from Larimer County telephone users and allocates funds to purchase and maintain the equipment used to process E911 telephone calls, train users, and dispatch appropriate Emergency Services Providers; and WHEREAS, LETA distributes funds to each Emergency Services Dispatch Center based on the number of dispatchers and the number of E911 telephone calls received at that location; and WHEREAS, LETA also distributes funds to each Emergency Services Dispatch Center based on the number of dispatchers and the number of Emergency Medical Dispatch calls handled by that location; and WHEREAS, funding is based on 2010 expenditures, and for 2011 the City will receive a total amount of $42,438 from LETA (the “LETA Funds”); and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, City staff has determined that the appropriation of the LETA Funds, as described herein, will not cause the total amount appropriated in the General Fund to exceed the current estimate of actual and anticipated revenues to be received in that fund during the fiscal year. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS that there is hereby appropriated from unanticipated revenue in the General Fund the sum of FORTY-TWO THOUSAND FOUR HUNDRED THIRTY-EIGHT DOLLARS (42,438) for expenditure in the General Fund for E911 and Emergency Medical Dispatch Systems at the Poudre Emergency Communications Center. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk DATE: July 5, 2011 STAFF: Steve Catanach Jon Haukaas AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 13 SUBJECT First Reading of Ordinance No. 077, 2011, Appropriating Unanticipated Revenue in the Light and Power, Water and Wastewater Funds for Capital Projects to Relocate Utility Facilities in the Mason Corridor Bus Rapid Transit Project and Transferring Existing Light and Power Appropriations into the Light and Power Utility Relocation Capital Project. EXECUTIVE SUMMARY This Ordinance appropriates capital project funding for the Utilities to relocate existing electric, water and wastewater facilities to accommodate the Mason Corridor Bus Rapid Transit (BRT) Project. Light and Power will also supply power to the bus stations along the corridor. The Utilities are being viewed by the MAX/BRT Project as independent contractors and will be reimbursed by the MAX/BRT Project funds for the relocation expenses upon completion. The MAX/BRT Project will also pay for the cost of electric power supply to the bus stations. The Ordinance provides new capital appropriations in the Light Power Fund ($620,000), Water Fund ($625,000) and Wastewater Fund ($1,150,000) for the relocation work. Following completion of the construction, the Utilities will invoice the MAX/BRT Project based on actual costs and will receive the unanticipated revenue being appropriated by the Ordinance. In addition to electric duct bank relocation, Light and Power will use this opportunity to upgrade the capacity of the duct bank. These system upgrade costs have been budgeted in Light and Power’s existing 2011 lapsing appropriation. The Ordinance transfers $400,000 of the existing Light and Power lapsing budget into the new BRT electric relocation/upgrade capital project. The costs of the upgrade will not be reimbursed by the MAX/BRT Corridor Project. BACKGROUND / DISCUSSION This Ordinance appropriates the following funds related to utilities work to accommodate the Mason Corridor Bus Rapid Transit Project. The amounts shown are construction estimates. The MAX/BRT Corridor Project will pay the Utilities based on actual design and construction costs. Relocation work will not proceed until authorization is issued by the MAX/BRT project manager. $400,000 Light and Power Fund – New Capital Project Appropriation This portion of the appropriation is fifty percent of the $800,000 cost to relocate and upgrade existing electric facilities for the MAX/BRT Project Corridor Project. This phase will involve the relocation of the duct bank between Drake and Prospect. The duct bank is being relocated due to logistical conflicts with the Mason Street Corridor guide way. Construction on this phase is anticipated to be completed by year-end. This $400,000 expense will be reimbursed by the MAX/BRT Project funding. $400,000 Light and Power Fund – Transfer of Existing 2011 Appropriation The Light and Power Fund will bear fifty percent of the cost for the $800,000 upgrade and relocation because this project will enlarge capacity for the electric system as well as move the existing system to accommodate the MAX/BRT Project. This portion of the appropriation is to be transferred from the existing 2011 Light and Power appropriation into the new Light and Power capital project. There will be no reimbursement for this half of the expense. $220,000 Light and Power Fund - New Capital Project Appropriation This is the estimated cost to provide electric service to the bus stations along the MAX/BRT Project Corridor. This electric construction is planned for 2012 and 2013. One hundred percent of the station power costs will be reimbursed by MAX/BRT Project. July 5, 2011 -2- ITEM 13 $625,000 Water Fund - New Capital Project Appropriation $1,150,000 Wastewater Fund - New Capital Project Appropriation With the construction of the MAX/BRT Project beginning in 2011, the Utility is faced with as many as 18 separate locations where the MAX/BRT crosses or parallels existing water and sewer infrastructure. This will impact the integrity, serviceability, longevity and safety of the operation of both the Utility pipelines and the MAX/BRT. Because of potential negative impacts to the Utility infrastructure (both immediately and in the future) or future impacts to the MAX/BRT, this is the opportunity to improve, modify and/or protect the water and sewer lines before the BRT improvements are built. The project has a short lead time with design scheduled to be done by early fall and construction completed by early in 2012. One hundred percent of the Water and Wastewater Utility’s expenses will be reimbursed by MAX/BRT Project funding. FINANCIAL / ECONOMIC IMPACTS These projects facilitate the construction of the MAX/BRT Corridor Project which will enhance both public transportation and economic development opportunities. The Water and Wastewater Funds will be fully reimbursed for all expenses related to the project. The Light and Power Fund will be reimbursed for all but $400,000. The portion that will not be reimbursed was included in the 2011 budget for electric system upgrades. Aging infrastructure will be upgraded during the relocation improving the future reliability of the system for customers. ENVIRONMENTAL IMPACTS No significant impacts are anticipated for the relocation of facilities. Electric loads will increase slightly when the bus stations are operational. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION At its May 4, 2011 meeting, the Electric Board voted unanimously to recommend approval of the appropriation in the Light and Power Fund. At its May 26, 2011 meeting, the Water Board voted unanimously to recommend approval of the appropriation. ATTACHMENTS 1. Electric Board minutes, May 4, 2011 2. Water Board minutes, May 26, 2011 3. Electric Relocation Map 4. Water and Sewer Relocation Map Attachment 1 Excerpt from Electric Board Minutes–May 4, 2011 Appropriation Request for Relocation of Utilities in Mason Corridor Mr. Catanach presented this information. The proposed ordinance appropriates capital project funding for the Utilities to relocate existing electric facilities to accommodate the BRT (Bus Rapid Transit)/Mason Corridor Project. Light and Power will also supply power to the stations. Since Light and Power will be upgrading and enlarging the existing facilities in addition to relocating the duct bank, only fifty percent of these costs will be reimbursed by the Federal funds. The remaining costs have been budgeted in the existing 2011 lapsing appropriation. The ordinance transfers $400,000 of the existing budget into the new BRT electric relocation capital project. Is duct bank work contracted out? No, Light and Power staff will be installing the duct bank. How much duct bank is being relocated? The area between Drake Road and Prospect Road is being relocated. Motion: Board Member Yurash moved that the Electric Board recommend that the City Council approve the proposed appropriation ordinance to fund electric additions and relocations in the BRT/Mason Corridor. Vice Chairperson DeCourcey seconded the motion. It passed unanimously. Attachment 2 Excerpt from Water Board Minutes, May 26, 2011 Appropriation Request for Relocation of Utilities in Mason Corridor (Attachments available upon request). Water Engineering and Field Operations Manager Jon Haukaas introduced the topic. Staff is seeking Water Board endorsement of an ordinance appropriating unanticipated revenue in the Water and Wastewater Funds for new capital projects to relocate water and wastewater facilities in the BRT (Bus Rapid Transit)/Mason Corridor. The cost of the relocations is to be reimbursed by the City to the Utilities through federal funding of the Mason Corridor Project. The Mason Corridor project involves relocating facilities from the South Transit Center location along to the Downtown Transit Center. City of Fort Collins Utilities has looked at what impact it will have on their services and infrastructure and have identified eighteen projects for possible protection or upgrades. The BRT project is a federal grant project and Utilities is treated as an outside agency. The BRT project team will make requests to Utilities at the necessary time to make the improvements. Utilities currently needs the funding for the design work and implementation. The request is to appropriate the anticipated revenues for 2012. Board discussion: Are any of the items work that Utilities would liked to have completed regardless of the project? Some of the work is direct opportunity work. For example, casings under the railroad need to be extended. Additional fill material will alter manholes. Some isolation valves will be added. The projects represent both a mix of opportunities for improvements and necessary work for the project. The water lines and wastewater lines will stay in the same place? There may be one or two relocations, but generally they will remain in the same place. Would any of the projects have been cheaper if other work had already commenced? Not really; the majority of the work is surface work other than the fill areas and the retaining walls. Beyond this, is there other work to be done from other funding? This represents most of the work to be done. Is the money in the Reserves fund? Yes. Is there any fiscal impact on taking the money now and paying it back later? No, it is money that is in the Reserves fund. Is the federal funding that is paying for the project part of the big picture? Utilities is not making significant improvements to the systems, just focusing on additional protections. Does anything need to be upsized with crossings? No, trunk lines have already been sized. How old are the lines? The lines in Downtown Fort Collins are approximately 80 - 100 years old. The lines in the south part of town are approximately 20 years old. Is it feasible to upgrade the older lines? No, it is not feasible. It is not an appropriate cost to the BRT project. Utilities is taking the opportunity while doing these projects to investigate and evaluate the lines. Are the lines west of the railroad tracks? The lines cross east to west. One or two of the lines are linear. Board Member Eccelston moved that the Water Board recommend that City Council approve the proposed appropriation ordinance to fund the relocation of water and wastewater facilities in the BRT/Mason Corridor. Board Member Goldbach seconded the motion. It passed unanimously. c-) - Total $1,020,000 t Harmony Rd. Fairi4’ay Ln. Mason Corridor - Approximate Project Boundary FELSBU RU HOLF U L L E \I C ATTACHMENT 3 — Electric Duct Bank Relocation and Station Power Che fl Laurel St. Pros +1- 55 mu es Duct Bank Relocation between Prospect and Drake $800,000 1 Drake Rd. I Electrical Power to BRT Stations $220,000 Horsetooth Rd. No S SHIELDS ST S LEMAY AVE W DRAKE RD E DRAKE RD W HARMONY RD W PROSPECT RD E PROSPECT RD W HORSETOOTH RD E HORSETOOTH RD RIVERSIDE AVE E HARMONY RD S LEMAY AVE 0 1,000000 2,000 4, Feet BRT- Mason Street Corridor Utility Crossings Water and Sewer projects casing extensions Cost: $172,000 Water and Sewer projects casing extensions Cost: $377,000 Water and Sewer projects casing extensions, manhole replacements, & valve installation Cost: $262,000 Water and Sewer projects manhole replacements & valve installation Cost: $964,000 Total Costs Water: $625,000 Wastewater: $1,150,000 ATTACHMENT 4 - Water and Wastewater Project ORDINANCE NO. 077, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING UNANTICIPATED REVENUE IN THE LIGHT AND POWER, WATER, AND WASTEWATER FUNDS FOR CAPITAL PROJECTS FOR UTILITY FACILITIES IN CONNECTION WITH THE MASON CORRIDOR BUS RAPID TRANSIT PROJECT AND TRANSFERRING EXISTING LIGHT AND POWER APPROPRIATIONS INTO THE LIGHT AND POWER UTILITY RELOCATION CAPITAL PROJECT WHEREAS, Utility Services currently has certain electric, water and wastewater infrastructure that needs to be either relocated, installed, or improved to accommodate the construction of improvements that are being installed for the Mason Corridor Bus Rapid Transit (“BRT Project”); and WHEREAS, for reasons independent of the BRT Project, certain other electric infrastructure also needs to be relocated, and the relocation work to be undertaken in connection with the BRT Project also provides an opportunity to generally upgrade the electric system infrastructure; and WHEREAS, the total cost of the work to relocate and upgrade the electric facilities is $800,000; and WHEREAS, the relocation portion of the work is considered an expense of the BRT Project, and Utility Services will be reimbursed for such work by the BRT Project fund in the amount of $400,000; and WHEREAS, the $400,000 needed for the electric system upgrades are not expenses to be charged to the BRT Project; and WHEREAS, the funds needed for such upgrades may be obtained by transferring existing appropriations from the Light and Power operating budget to the Light and Power Utility Relocation capital project budget; and WHEREAS, Utility Services will also be installing infrastructure that will provide electric service to the BRT stations and the cost of this work is $220,000, which cost will be reimbursed by the BRT Project; and WHEREAS, Utility Services also has existing water and wastewater infrastrucutre in the BRT Project corridor; and WHEREAS, because the BRT Project may impact the integrity of the water and wastewater infrastructure, and may negatively affect the ability to service the infrastructure, Utility Services desires to make improvements to the infrastructure prior to the construction of the BRT Project; and WHEREAS, the estimated total cost of the water and wastewater infrastructure improvements is estimated to be $1,775,000, which cost will be reimbursed by the BRT Project; and WHEREAS, Article V, Section 9, of the City Charter authorizes the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for the fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, Article V, Section 10, of the City Charter authorizes the City Council to transfer by ordinance any unexpended and unencumbered amount or portion thereof from one fund or capital project to another fund or capital project, provided that the purpose for which the transferred funds are to be expended remains unchanged; and WHEREAS, City staff has determined that the appropriation of the reimbursement amounts described herein will not cause the total amount appropriated in the Light and Power Fund, the Water Fund, or the Wastewater Fund to exceed the current estimate of actual and anticipated revenues to be received in the funds during the fiscal year; and NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from unanticipated revenue in the Light and Power Fund the sum of FOUR HUNDRED THOUSAND DOLLARS ($400,000) for expenditure in the Light and Power Utility Relocation capital project account to relocate existing electric facilities in the Mason Corridor. Section 2. That the unexpended appropriated amount of FOUR HUNDRED THOUSAND DOLLARS ($400,000) is hereby authorized for transfer from the Light and Power operating budget to the Light and Power Utility Relocation capital project account to perform upgrades to electrical system infrastructure in the Mason Corridor. Section 3. That there is hereby appropriated from unanticipated revenue in the Light and Power Fund the sum of TWO HUNDRED TWENTY THOUSAND DOLLARS ($220,000) for expenditure in the Light and Power Utility Relocation capital project account to provide electric service to the BRT bus stations. Section 4. That there is hereby appropriated from unanticipated revenue in the Water Fund the sum of SIX HUNDRED TWENTY FIVE THOUSAND DOLLARS ($625,000) for expenditure in the Water Fund Distribution System Replacement capital project account to improve, modify and/or protect the water lines before the BRT Project improvements are built. Section 5. That there is hereby appropriated from unanticipated revenue in the Wastewater Fund the sum of ONE MILLION ONE HUNDRED FIFTY THOUSAND DOLLARS ($1,150,000) for expenditure in the Wastewater Fund Collection System -2- Replacement capital project account to improve, modify and/or protect the sewer lines before the BRT Project improvements are built. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Craig Foreman AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 14 SUBJECT Items Relating to the Hughes Stadium Disc Golf Course. A. Resolution 2011-053 Authorizing the City Manager to Enter Into a Grant Agreement with Great Outdoors Colorado for Funds for a Disc Golf Course at Hughes Stadium. B. First Reading of Ordinance No. 078, 2011 Appropriating Unanticipated Grant and Other Revenue in the Conservation Trust Fund for the Hughes Stadium Disc Golf Course. EXECUTIVE SUMMARY Great Outdoors Colorado has awarded the City an $85,000 grant for the completion of the Hughes Stadium Disc Golf Course. The project involves the development of an 18-hole disc golf course at Hughes Stadium in conjunction with Colorado State University. The course is primarily located in the stormwater detention basin directly west of Overland Trail Road. The course will include new trees and shrubs, a new access road off County Road No. 42C, and the course tee areas and baskets. BACKGROUND / DISCUSSION On February 15, 2011, Council adopted Resolution 2011-012, supporting the City’s grant application for the Hughes Stadium Disc Golf Course project. The need for another disc golf course in Fort Collins was well documented during the Parks and Recreation Policy Plan update which was adopted by Council in 2009. The popularity of disc golf has grown over the years and the course at Edora Park is overused, causing safety concerns for other park users and resource damage to trees and turf. Colorado State University has been working with the City to develop a course at Hughes Stadium. The University is committed to the course being developed in and around the stormwater detention pond near Overland Trail Road (see Attachment 1). The course design has been integrated into an improvement project CSU is constructing in 2011 on the grounds around the stadium. This partnership allows for efficiencies and cost savings related to the design effort and for construction costs on such items as the irrigation water delivery system, earthwork and landscaping. The construction of the disc golf course is planned for fall 2011. The new disc golf course at Hughes Stadium will allow some disc golf holes to be removed from Edora Park, thus helping reduce conflicts and safety concerns with other park users. FINANCIAL / ECONOMIC IMPACTS The project continues the strong and effective partnerships with Colorado State University. Construction of the disc golf course is estimated to cost $135,000. The funding source is the Conservation Trust Fund. The Great Outdoors Colorado grant amount is for $85,000. The grant funding is a repay available at the time of the completion of the project. Consequently, the grant reduces the Conservation Trust cost for the project to $48,700, and $1,300 in-kind donations from the Fort Collins Disc Golf Club and Bill Wright. Operation and maintenance funding for the project will be about $2,500 per year. This O&M cost is available starting with the 2011 Parks Maintenance budget. It is hopeful that the disc golf community can help with routine maintenance of the site through the City’s Adopt-A-Park program and thus reduce O&M costs. July 5, 2011 -2- ITEM 14 ENVIRONMENTAL IMPACTS Trees at the course will be watered by drip irrigation to reduce water usage and waste. Fairways will not be irrigated and will be identified using gravel paths rather than irrigated turf saving additional water usage. Use at the new course will reduce the over-use of the Edora Park course and help eliminate turf and tree damages at the park. STAFF RECOMMENDATION Staff recommends adoption of the Resolution and the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION At its January 26, 2011 meeting, the Parks and Recreation Board voted unanimously to recommend Council approve the acceptance of the grant. PUBLIC OUTREACH During the recent Parks and Recreation Policy Plan public process, the need for more disc golf courses to serve the community was identified as a priority. The new course is supported by the Fort Collins Disc Golf Club, CSU Administration and the CSU Disc Golf Club. The new course is being designed with the assistance of Bill Wright who is active in the disc golf community and has designed numerous courses. ATTACHMENTS 1. Location map 2. Parks and Recreation Board minutes, January 26, 2011 ATTACHMENT 1 Parks & Recreation Board Meeting – January 26, 2011 Page 6 of 18 Board – What about a Park District? Staff – It’s complicated there are good and bad things to consider when you create a district. Board – Is the Board information going to be updated on the Recreator? Staff – Yes, John Litel has been informed of the changes for the next addition. Park Planning Updates • Waters Way and Registry Ridge parks are back in line for construction. We are working with the contractor to construct Waters Way in 2011 and Registry Ridge will go out to bid in January for construction in 2011. • Transportation money ($368,375) will help to fund some of the Mulberry Trail project. • CSU has started the design phase for the new Disc Golf Course to be located at Hughes Stadium. We are applying for a GOCO grant to help fund this project. GOCO requires a recommendation from City Council, so we need to have a recommendation from the P&R Board to Council for the February 15 Council meeting. Motion: A motion was made by Danna: Move to recommend to City Council that they support applying for a grant for the disc golf course at Hughes Stadium. Seconded: The motion was seconded by Shirley Christian Vote: 9:0 – all voted in favor Discussion Board – Is there any worry about parking at Hughes? Staff – No, the poles will be removed on game days. Board – Is there any issue with theft? Staff – No. Board Work Plan Updates • Look over the Work Plan so we can get a strategic plan for next meeting on what we want to work on. • The election of Board Officers is next month, so be thinking about what position you would like to hold. Discussion Board – Can we get a tour of the parks? Staff – Sure, we can set something up when the weather is nicer. Board – Do you know if the cabins at the Museum will be moving to the new Discovery/Museum site? Staff – Not sure, but we will find out. Board – It would be good for us to be at the ground breaking for the new parks. Board – When will the Lincoln Center be open? Staff – The end of April was the date, but with the issues they’ve had, it will probably be more like June or July before they are open. Bicycle Advisory Board Liaison Update • They are planning to apply for Platinum level designation for a bike friendly community. We are currently Gold level. • They are working on a bike safety/education plan, and there is a meeting on January 27. They will be discussing history, groups that advocate for bicycling, accidents, working with other departments. • In the Recreator there is a new item: Senior Rides. • The e-bike issue will continue to be on their agenda for discussions. ATTACHMENT 2 RESOLUTION 2011-053 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CITY MANAGER TO ENTER INTO A GRANT AGREEMENT WITH GREAT OUTDOORS COLORADO FOR FUNDS FOR A DISC GOLF COURSE AT HUGHES STADIUM WHEREAS, the Board of the Great Outdoors Colorado Trust Fund (the “GOCO Board”) is a political subdivision of the State of Colorado which invests a portion of the net proceeds of the Colorado Lottery in the State’s parks, wildlife, open space and recreational resources; and WHEREAS, in 1994 the GOCO Board created a statewide grant program pursuant to which eligible entities could apply for grants for local government parks and outdoor recreation projects; and WHEREAS, on June 14, 2011, the GOCO Board approved a Local Parks and Outdoor Recreation application by the City for a grant to be used for construction of a disc golf course on property owned by Colorado State University (CSU) at Hughes Stadium (the “Project”), and has awarded the City a grant in the amount of $85,000 to be used together with matching funds to construct the Project; and WHEREAS, City staff is in the process of negotiating a lease agreement with CSU for use of the property for the Project; and WHEREAS, the total cost of the Project is estimated at $135,000, with $48,700 of additional funding to come from the Conservation Trust Fund, subject to Council’s appropriation of such funds by separate ordinance, and $1,300 of in-kind donations; and WHEREAS, the City is authorized to enter into intergovernmental agreements, such as a grant agreement, to provide any function, service or facility, under Article II, Section 16 of the Charter of the City of Fort Collins and Section 29-1-203, C.R.S.; and WHEREAS, the GOCO Grant Agreement, a copy of which is on file in the office of the City Clerk and available for public inspection (the “Grant Agreement”), requires a resolution, adopted by the governing body of the Grantee, authorizing the execution of the Grant Agreement and approving its terms and conditions; and WHEREAS, the Grant Agreement further requires that the City operate and maintain the Project for 25 years or the useful life of the Project, subject to the annual appropriation of funds, allow reasonable public access to the Project, and cooperate with the GOCO Board on publicity, public information and signage for the Project; and WHEREAS, City staff recommends that the City Council approve the Grant Agreement as described herein. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Manager is hereby authorized to enter into the Grant Agreement with the GOCO Board obligating the City to use the $85,000 in grant proceeds for construction of the disc golf course at Hughes Stadium, in substantially the form of agreement as is on file in the office of the City Clerk, and that the terms of the Grant Agreement are approved together with such other terms and conditions as the City Manager, in consultation with the City Attorney, determines to be necessary and appropriate to protect the best interests of the City. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 5th day of July, A.D. 2011. __________________________________ Mayor ATTEST: _____________________________ City Clerk ORDINANCE NO. 078, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING UNANTICIPATED GRANT AND OTHER REVENUE IN THE CONSERVATION TRUST FUND FOR THE HUGHES STADIUM DISC GOLF COURSE WHEREAS, the City has been awarded a grant in the amount of $85,000 (the “Grant”) from Great Outdoors Colorado (“GOCO”) for the completion of the Hughes Stadium Disc Golf Course; and WHEREAS, the project involves the development of an 18-hole disc golf course at Hughes Stadium in conjunction with Colorado State University; and WHEREAS, this partnership with Colorado State University allows for efficiencies and cost savings related to the design effort and for construction costs; and WHEREAS, the course will include new trees and shrubs, a new access road from County Road No. 42C, and the course tee areas and baskets; and WHEREAS, the total project will cost $135,000 and is funded from the following sources: Great Outdoors Colorado grant ($85,000), in-kind donations ($1,300), and Conservation Trust Fund Reserves ($48,700); and WHEREAS, Article V, Section 9, of the City Charter authorizes the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, Article V, Section 9, of the City Charter authorizes the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated. WHEREAS, City staff has determined that the appropriation of the grant and other revenue as described herein will not cause the total amount appropriated in the Conservation Trust Fund to exceed the current estimate of actual and anticipated revenues to be received in that fund during any fiscal year. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from unanticipated revenue in the Conservation Trust Fund the sum of EIGHTY FIVE THOUSAND DOLLARS ($85,000) in grant revenue and ONE THOUSAND THREE HUNDRED DOLLARS ($1,300) consisting of in-kind donations, for expenditure in the Conservation Trust Fund for the completion of the Hughes Stadium Disc Golf Course. Section 2. That there is hereby appropriated from prior year reserves in the Conservation Trust Fund the sum of FORTY-EIGHT THOUSAND SEVEN HUNDRED DOLLARS ($48,700) for expenditure in the Conservation Trust Fund for the completion of the Hughes Stadium Disc Golf Course. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk DATE: July 5, 2011 STAFF: Steve Catanach Ginger Purvis AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 15 SUBJECT Items Relating to Amendments to the Definitions in Article I of Chapter 26, the Electric Article of Chapter 26, and to Standards for Interconnection of Electric Generation Facilities. A. First Reading of Ordinance No. 079, 2011, Making Certain Amendments to Chapter 26 of the City Code Pertaining to the Provision of Net Metering Service and Certain Definitions Related Thereto. B. First Reading of Ordinance No. 080, 2011, Amending Various Provisions of the City Code and the Land Use Code Pertaining to the Definition of General Manager. C. First Reading of Ordinance No. 081, 2011, Making Certain Amendments to Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System EXECUTIVE SUMMARY The Fort Collins Utilities Light and Power Department is proposing minor revisions to the definitions section of Article I and to the Electric Article of Chapter 26 of the City Code and the Land Use Code. These revisions include updating the definition of General Manager, clarification regarding the provision of net metering service and clarification regarding authority to execute interconnection or parallel generation agreements on behalf of the City. Light and Power is also recommending adding clarifying language to the City’s indemnification and insurance requirements contained in the City’s Interconnection Standards. These standards govern operational and other requirements for interconnection generating facilities to the City’s electric distribution system. BACKGROUND / DISCUSSION The Light and Power Department is proposing the following revisions to the Electric Article of the City Code and revisions to the Land Use Code. These revisions are primarily definitional in nature. 1. Title revision and appointment: General Manager of Utility Services or General Manager shall mean Utilities Executive Director or appointed designee of such Executive Director. Sec 26-391. “Definitions”. 2. Clarifying that “Net metering service” is available exclusively for a qualifying facility “using a qualifying renewable technology”. Sections 26-391, 465 through 468. Also included is an amendment specifically authorizing the Utilities General Manager or the Manager’s appointed designee to sign interconnection agreements or parallel generation agreements. Light and Power is also recommending adding clarifying language to the City’s indemnification and insurance requirements contained in the City’s Interconnection Standards. As currently written, the indemnification and insurance requirements in the Interconnection Standards allow for no flexibility where a governmental entity cannot by law indemnify the City and may elect to self-insure in accordance with Colorado law. By adding the following language, “except when the Operator is a governmental entity that self-insures in accordance with Colorado law”, the City’s Interconnection Standards will now allow for that flexibility. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. July 5, 2011 -2- ITEM 15 BOARD / COMMISSION RECOMMENDATION On May 4, 2011, the recommended amendments and revisions were presented to the Electric Board. The Board requested additional clarification to the City’s indemnification and insurance requirements in the agreement as it relates to the Utilities collaboration with CSU and the RDSI project. Staff explained that the interconnection requirements and the system protections installed by the Utilities are designed to protect the Utilities distribution system from any type of damage such as spikes. After a brief discussion clarifying CSU’s current position on indemnification and insurance in the Interconnection Agreement, the Board unanimously voted to recommend the City Council adopt the amendments to the City Code and the revisions to the City’s Interconnection Standards. ATTACHMENTS 1. Electric Board minutes, May 4, 2011 ATTACHMENT 1 Excerpt from Approved Electric Board Minutes–May 4, 2011 Minor Amendments to the Electric Article of the City Code and Interconnection Standards Mr. Catanach presented this information. The Fort Collins Utilities Light and Power Department (L&P) is proposing minor updates to the Electric Article of the City code. These revisions are primarily definitional in nature, reference items 1 and 2 below. 1. Title revision and appointment: General Manager of Utility Services or General Manager shall mean Utilities Executive Director or appointed designee of such Executive Director. Sec 26-391. “Definitions.” 2. Clarifying that “Net metering service” is available exclusively for a qualifying facility “using a qualifying renewable technology.” Sections 26: 391, 465, 466, 467, 468. The proposed changes to the code include providing clear definition that where referenced, the General Manager shall be recognized as the Utilities Executive Director or his designee. The intent is to help clarify some confusion with the code. The other proposed change provides clarification that a qualifying resource where used in the net metering rate code is in reference to qualifying renewable technologies. This insures that the intent of the net metering code is clearly defined. Board discussion: Because of the Renewable and Distributed Systems Integration (RDSI) project, Colorado State University (CSU) is generating so much electricity that their equipment creates a spike. Someone else claims damage from the spike and they would in turn attempt litigation against the City of Fort Collins Utilities. The agreement was written to make CSU responsible for any damage caused by the spike. Mr. Catanach stated that CSU is protected by the state constitution and cannot provide indemnification to other entities. To address the concerns, the interconnection requirements and the system protections installed by Utilities are designed to protect Utilities from any type of damage such as spikes. Should those protections fail, Utilities would work cooperatively with CSU. If a cooperative solution could not be found, the next step would be litigation. What did you have in place before? There was an Interconnection Agreement that was adopted previously. Utilities fell back on the old agreement to move the project forward with CSU. The existing agreement does not require CSU to indemnify the City. Board member Yurash stated that he initiated the discussion because he is trying to understand the proposed changes and was curious where the risk was pointed to now. Motion: Board Member Graham moved that the Electric Board recommend that the City Council adopt by ordinance the proposed Minor Amendments to the Electric Article of the City Code and revisions to the Interconnection Standards. Board Member Harris seconded the motion. It passed unanimously. ORDINANCE NO. 079, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS MAKING CERTAIN AMENDMENTS TO CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS PERTAINING TO THE PROVISION OF NET METERING SERVICE AND CERTAIN DEFINITIONS RELATED THERETO WHEREAS, on February 2, 2010, City Council approved Ordinance No. 003, 2010, amending Chapter 26, Article VI of the City Code to allow for the provision of net metered electric service; and WHEREAS, City staff intends for net metered electric service to be made available only for those qualifying facilities that use a qualifying renewable technology as those terms are currently defined in the City Code; and WHEREAS, City staff believes that the head of Utilities Services should be authorized to execute valid interconnection or parallel generation agreements with customers who wish to interconnect qualifying facilities to the City’s electric distribution system; and WHEREAS, on May 4, 2011, the Fort Collins Electric Board reviewed and considered the proposed amendments to the City Code and voted unanimously to recommend that the City Council make such amendments. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the definition “Net metering service” contained in Section 26-391 of the Code of the City of Fort Collins is hereby amended to read as follows: Net metering service shall mean that service available to a customer- generator operating a qualifying facility using a qualifying renewable technology that is interconnected to the electric utility so that any electric energy generated by the qualifying facility in excess of that used by the qualifying facility is delivered to the electric utility system and used to offset metered energy received by the customer- generator during the billing period. Section 2. That the definition “Qualifying facility” contained in Section 26-391 of the Code of the City of Fort Collins is hereby amended to read as follows: Qualifying facility shall mean an electric-generating facility operated in parallel with the City of Fort Collins electric distribution system that has been inspected for compliance with the City of Fort Collins Utility Services Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System, has been issued a “Permit to Operate” by the City and is operated under a valid “Interconnection Agreement” withor “Parallel Generation Agreement” executed on behalf of the City of Fort Collins by the General Manager. Section 3. That Section 26-464(o)(1) of the Code of the City of Fort Collins is hereby amended to read as follows: (o) Net metering. (1) Net metering service is available to a customer-generator producing electric energy exclusively with a qualifying facility using a qualifying renewable technology when the generating capacity of the customer-generator’s qualifying facility meets the following two (2) criteria: . . . Section 4. That Section 26-465(q)(1) of the Code of the City of Fort Collins is hereby amended to read as follows: (q) Net metering. (1) Net metering service is available to a customer-generator producing electric energy exclusively with a qualifying facility using a qualifying renewable technology when the generating capacity of the customer-generator’s qualifying facility meets the following two (2) criteria: . . . Section 5. That Section 26-466(r)(1) of the Code of the City of Fort Collins is hereby amended to read as follows: (r) Net metering. (1) Net metering service is available to a customer-generator producing electric energy exclusively with a qualifying facility using a qualifying renewable technology when the generating capacity of the customer-generator’s qualifying facility meets the following two (2) criteria: . . . Section 6. That Section 26-467(u)(1) of the Code of the City of Fort Collins is hereby amended to read as follows: (u) Net metering. (1) Net metering service is available to a customer-generator producing electric energy exclusively with a qualifying facility using a qualifying renewable technology when the generating capacity of the customer-generator’s qualifying facility meets the following two (2) criteria: . . . -2- Section 7. That Section 26-468(v)(1) of the Code of the City of Fort Collins is hereby amended to read as follows: (v) Net metering. (1) Net metering service is available to a customer-generator producing electric energy exclusively with a qualifying facility using a qualifying renewable technology when the generating capacity of the customer-generator’s qualifying facility meets the following two (2) criteria: . . . Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- ORDINANCE NO. 080, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING VARIOUS PROVISIONS OF THE CODE OF THE CITY OF FORT COLLINS AND THE FORT COLLINS LAND USE CODE PERTAINING TO THE DEFINITION OF GENERAL MANAGER WHEREAS, certain provisions in both the City Code and the Land Use Code contain references to the “General Manager of Utility Services” or “General Manager”; and WHEREAS, the title of the head of the Utility Services service area has been changed to “Utilities Executive Director”; and WHEREAS, the City Code and the Land Use Code need to be updated to reflect the current title of the head of Utilities Services. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the Code of the City of Fort Collins is hereby amended by changing all current references to the “General Manager of Utility Services” or “General Manager” so as to read the “Utilities Executive Director.” Section 2. That the Fort Collins Land Use Code is hereby amended by changing all current references to the “General Manager of Utility Services” or “General Manager” so as to read “Utilities Executive Director.” Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk ORDINANCE NO. 081, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS MAKING CERTAIN AMENDMENTS TO INTERCONNECTION STANDARDS FOR GENERATING FACILITIES CONNECTED TO THE FORT COLLINS DISTRIBUTION SYSTEM WHEREAS, on February 2, 2010, City Council approved and adopted Interconnection Standards for Generating Facilities Connected to the Fort Collins Distribution System (the “Standards”); and WHEREAS, the Standards as currently adopted do not allow sufficient flexibility in situations where a customer wishing to interconnect to the City electric distribution system is prohibited by law from indemnifying the City or where such customer is self-insured; and WHEREAS, on May 4, 2011, the Fort Collins Electric Board reviewed and considered proposed amendments to the Standards, section 9.0, in the form entitled “Updated Standards”, attached hereto as Exhibit “A” and incorporated herein by this reference, and voted unanimously to recommend that the City Council adopt the Updated Standards; and WHEREAS, the Updated Standards clarify that the indemnification requirements apply to the extent permitted by law and that the insurance requirements do not apply when the customer is a governmental entity that self-insures. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the Updated Standards are hereby approved and adopted. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk UPDATED STANDARDS INTERCONNECTION STANDARDS FOR GENERATING FACILITIES (GF) CONNECTED TO THE FORT COLLINS DISTRIBUTION SYSTEM July 2011 January 2010 Deleted: January 2010 EXHIBIT A Rev 9.0 July 2011 3 TABLE OF CONTENTS 1.0 SCOPE AND GENERAL REQUIREMENTS...................................................................................................5 1.1 SCOPE AND INTENT .................................................................................................................................................5 1.2 SYSTEM PHASE AND VOLTAGE................................................................................................................................5 1.3 SYSTEM RECLOSING................................................................................................................................................5 1.4 ISLANDING ..............................................................................................................................................................5 1.5 SYNCHRONIZING .....................................................................................................................................................6 1.6 IMPROPER OPERATION OF THE GF...........................................................................................................................6 1.7 SYSTEM CAPACITY LIMITATIONS ............................................................................................................................6 1.8 SUBMITTAL REQUIREMENT .....................................................................................................................................7 2.0 STANDARDS AND DEFINITIONS...................................................................................................................7 2.1 STANDARDS ............................................................................................................................................................7 2.2 DEFINITIONS .......................................................................................................................................................8 3.0 GF EQUIPMENT AND INSTALLATION REQUIREMENTS ......................................................................8 3.1 GENERAL REQUIREMENTS.......................................................................................................................................8 3.2 INTERCONNECTION DISCONNECT SWITCH...............................................................................................................9 3.3 DEDICATED TRANSFORMER AND ADDITIONAL PRIMARY PROTECTION...................................................................9 3.4 INTERRUPTING DEVICES REQUIRED ......................................................................................................................10 3.5 SYSTEM PROTECTIVE FUNCTIONS .........................................................................................................................10 3.6 MOMENTARY PARALLELING GENERATION FACILITIES .........................................................................................13 4.0 FACILITY GROUNDING ................................................................................................................................13 4.1 EQUIPMENT BONDING CONDUCTOR ......................................................................................................................14 4.2 SURGE PROTECTION ..............................................................................................................................................14 4.3 SYSTEM GROUNDING ............................................................................................................................................14 5.0 PREVENTION OF INTERFERENCE AND UNACCEPTABLE OPERATING CONDITIONS .............15 5.1 VOLTAGE REGULATION.........................................................................................................................................16 5.2 SYSTEM VOLTAGE.................................................................................................................................................16 5.3 SYSTEM FREQUENCY.............................................................................................................................................16 5.4 SYNCHRONIZATION ...............................................................................................................................................17 5.5 FLICKER ................................................................................................................................................................17 5.6 HARMONICS ..........................................................................................................................................................18 5.7 POWER FACTOR.....................................................................................................................................................18 6.0 MONITORING PROVISIONS.........................................................................................................................19 6.1 METERING.............................................................................................................................................................19 6.2 MONITORING AND CONTROL REQUIREMENTS .......................................................................................................19 7.0 TESTING ............................................................................................................................................................20 7.1 COMMISSIONING TESTS.........................................................................................................................................20 7.2 PERIODIC MAINTENANCE TESTS ...........................................................................................................................20 7.3 QUALIFIED PERSONNEL.........................................................................................................................................21 8.0 DESIGN CHANGES ..........................................................................................................................................21 9.0 LIABILITY AND INSURANCE.......................................................................................................................21 APPENDIX A-TYPICAL ONE-LINE INDUCTION GENERATOR BETWEEN 50KW AND 100KW ....................23 APPENDIX B-TYPICAL ONE-LINE INVERTER CONNECTED GENERATOR BELOW 1000KW. ....................24 APPENDIX C-TYPICAL ONE-LINE SYNCHRONOUS GENERATOR 50KW AND ABOVE ................................25 EXHIBIT A Rev 9.0 July 2011 4 APPENDIX D-TYPICAL ONE-LINE INDUCTION GENERATOR LARGER THAN 100KW.................................26 APPENDIX E-TYPICAL ONE-LINE INVERTER CONNECTED GENERATOR LARGER THAN 1000KW.......27 Formatted: Bullets and Numbering EXHIBIT A Rev 9.0 July 2011 5 Scope and General Requirements 1.1 Scope and Intent The requirements contained in this document apply to all generation sources connected to the FCU distribution system 5MW and below at any one location. Any and all connections to the FCU distribution system and any aspect of such connection are subject to FCU review and such connections shall not be permitted unless approved by FCU. The operation and design of any GF must meet all of the requirements contained in this document, any written agreement between FCU and the Operator, as well as any applicable requirements contained in Chapter 26 of the Fort Collins Municipal Code and Fort Collins Utilities Electric Service Rules and Regulations. Any location where the aggregate total generation exceeds 5MW may require additional study by FCU. This study will consider the specific feeder where the GF is proposed to be connected. If the addition of any GF causes the total amount of generation by all sources on that feeder to exceed 50% of the minimum load on that feeder, additional study by FCU is required and the requirements produced as a result of that study may exceed those in this document. If the GF source to be added is highly variable such as wind or solar, and the total amount of wind or solar generation by all sources on that feeder exceeds 13.3% of the feeder capacity, or if the total of all the wind or solar generation on any substation exceeds 13.3% of the substation transformer size, additional study by FCU is required and the requirements produced as a result of that study may exceed those in this document. Protection and safety devices are intended to provide protection for the FCU distribution system, FCU utility workers, FCU customers and the general public. Protective devices installed on the GF are designed to ensure that the fault current supplied by the GF will be interrupted in the event a fault occurs on the FCU distribution system. When a fault occurs, the GF must be designed to automatically disconnect from the FCU distribution system until the distribution system is restored to normal operation. Any source not explicitly described in this document will require special study before it is allowed to interconnect to FCU. 1.2 System Phase and Voltage The GF may interconnect to the system at any service voltage available at the site. Additional voltages may be arranged with FCU on a case-by-case basis, subject to FCU approval. If the site contains a three-phase system the GF equipment must be three-phase. If only a single phase service is available, a single-phase GF may be allowed. The maximum nameplate rating of all the single-phase generators at any GF shall not exceed 20 kVA if connected line-line. When the site contains a center-tapped single-phase service, machines may be connected between phase and the center-tapped neutral providing the maximum nameplate rating of the generator connected does not exceed 5 kVA. 1.3 System Reclosing Automatic reclosing is generally not utilized on the FCU distribution systems to clear temporary faults; however, in the cases and locations where automatic reclosing is used, the GF must be designed to ensure that the GF will disconnect from the distribution system in the event an automatic reclose occurs. Normally the GF will not be allowed to interfere with automatic reclosing where it exists; however, industry standards require that a GF must automatically disconnect from an islanded system within two seconds. If the existing reclosing interval is faster than two seconds FCU will reset it to accommodate the GF. 1.4 Islanding Islanding occurs when a GF becomes separated from the main generation source on a distribution system, but continues to independently serve a portion of the distribution system. GF’s shall be EXHIBIT A Rev 9.0 July 2011 6 equipped with protective devices and controls designed to prevent the generator from being connected to a de-energized distribution system. Islanding is not permitted on the FCU distribution system. 1.5 Synchronizing Synchronization of the GF with the FCU system must be done automatically. Any proposal to allow manual synchronization is subject to review and approval by FCU. All GF’s must use protective devices that prevent electrically closing a GF that is out of synchronization with the distribution system. FCU will under no circumstances be responsible or liable for any damage done due to an out of synchronization closure of a GF onto the system. Additionally, the Operator is responsible and liable for any damage done to the FCU system by any type of improper closing onto the system. 1.6 Improper Operation of the GF Operation and design of the GF must meet all the requirements contained in this document as well as any applicable requirements contained in the Fort Collins Municipal Code and the Fort Collins Utilities Electric Service Rules and Regulations and any written agreement between FCU and the Operator. Also, no GF operation will at any time be allowed to adversely impact the operation of the FCU system in any way. The GF must not produce adverse amounts of unbalanced currents or voltages; produce high or low voltages, or unacceptable frequencies; it must not inject DC or harmonics into the system beyond what is allowed by this document; or cause excessive operations of system voltage regulating devices such as load tap changers and voltage regulators. The GF must not adversely affect system grounding or ground fault protection. FCU will not normally interfere with the operation of any GF. However, when requested by FCU by telephone, in person, or in writing, the Operator must immediately stop operation and not resume operation until cleared by FCU to do so. If the Operator begins to operate the GF out of the ranges or conditions listed herein, the Operator must agree to cease operation until such a time as the GF Operator can demonstrate to FCU that it has remedied the problem and can once again operate the GF in compliance with these requirements. If usage of the GF causes unusual fluctuations or disturbances on, or interference with FCU’s system or other FCU customers, FCU shall have the right to require the GF to install suitable apparatus to reasonably correct or limit such fluctuation, disturbance or interference at not expense to FCU or other customers. 1.7 System Capacity Limitations The equipment installed by FCU to distribute power is limited in size and is normally sized for safe and efficient delivery of power. Adding generation to this system, especially generation supplied by renewable sources which normally have low capacity factors, may quickly overload the existing equipment. Care must be taken when adding generation to avoid damaging FCU equipment. Also, when system penetration levels of distributed generation becomes large enough, accidental islanding of sections of the system becomes possible, and additional protective devices or systems, such as transfer trip equipment, may be needed for safe operation of the FCU system. Whenever one or more of the following limitations are exceeded, FCU may need to conduct an additional study and FCU may require additional equipment. Additional study is required if: a) The rated aggregate generation kVA on any distribution transformer after the addition of the new GF equals or exceeds 100% of the rating of the transformer b) The rated aggregate generation kVA on any protective device or feeder from the point of interconnection to the substation transformer exceeds 13.3% of the rating of that protective device or feeder c) The rated aggregate generation kVA on any feeder or portion of a feeder equals or exceeds 50% of the existing annual minimum load on that feeder or feeder section EXHIBIT A Rev 9.0 July 2011 7 d) The proposed GF results in more than 90kW of single-phase generation on one phase of a feeder when both the new and existing generation are included e) The proposed GF includes an induction machine 300kW or greater, or an aggregate of 300kW of induction generators 1.8 Submittal Requirement The Operator shall submit in a timely manner, sufficient design and specification information relating to the facilities to be installed by the Operator. FCU shall be entitled to review and approve or disapprove these facilities prior to their installation and energization. The Operator agrees to incorporate any reasonable design changes requested by FCU prior to, during, or after installation of the GF’s facilities. FCU’s approval or acceptance of any design and specification information related to the GF to be installed shall not be construed as an endorsement of such engineering plans, specifications, or other information. The following drawings and other documents must be submitted to FCU for approval before any construction is begun. a) Single-line diagram of the facility showing the sizes of all equipment and the system protection planned b) Cut sheets on all equipment planned including inverters, generators, fuses, circuit breakers, switches, etc. c) Capability curves on all synchronous and doubly fed induction generators. d) Short circuit calculations. 2.0 Standards and Definitions 2.1 Standards In all cases the current edition of the following standards should be referred to in design of the power plant, choice of equipment, and interconnection design. a) ANSI C84.1 American National Standard for Electric Power Systems and Equipment- Voltage ratings (60 Hertz) b) IEEE Std. 18 IEEE Standard for Shunt Capacitors c) IEEE Std. 32 IEEE Standard Requirements, Terminology, and Test Procedures for Neutral Grounding Devices d) IEEE Std. 141: IEEE Recommended Practice for Electric Power Distribution for Industrial Plants e) IEEE Std. 142: IEEE Recommended Practice for Grounding of Industrial and Commercial Power Systems f) IEEE Std. 242: IEEE Recommended Practice for Protection and Coordination of Industrial and Commercial Power Systems g) IEEE Std. 519: Recommended Practices and Requirements for Harmonic Control in Electric Power Systems h) IEEE Std. 665: IEEE Standard for Generation Station Grounding i) IEEE Std. 1015: IEEE Recommended Practice for Applying Low-Voltage Circuit Breakers Used in Industrial and Commercial Power Systems j) IEEE Std. 1036: IEEE Standard for Application of Shunt Power Capacitors k) IEEE 1547 IEEE Standard for Interconnecting Distributed Resources with Electric Power Systems l) IEEE 1547.1 IEEE Standard Conformance Test Procedures for Equipment Interconnecting Distributed Resources with Electric Power Systems m) IEEE 1547.2 IEEE Application Guide for IEEE Std. 1547, IEEE Standard for Interconnecting Distributed Resources with Electric Power Systems n) IEEE Std. C2: National Electrical Safety Code EXHIBIT A Rev 9.0 July 2011 8 o) IEEE Std. C37.06: IEEE Standard for AC High-Voltage Circuit Breakers rated on a Symmetrical Current Basis-Preferred Ratings and Required Capabilities. p) IEEE C37.012: IEEE Application Guide for Capacitor Current Switching for AC High- Voltage Circuit Breakers q) IEEE C37.66: IEEE Standard Requirements for Capacitor Switches for AC Systems (1kV thru 38kV). r) IEEE C37.90 IEEE Standard for Relays and Relay Systems Associated with Electric Power Apparatus s) IEEE C37.90.1 IEEE Standard for Surge Withstand capability (SWC) Tests for Relay and Relay Systems Associated with Electric Power Apparatus. t) IEEE C37.90.2 IEEE Standard for Withstand Capability of Relay Systems to Radiated Electromagnetic Interference from Transceivers u) IEEE C37.90.3 IEEE Standard Electrostatic Discharge Tests for Protective Relays v) IEEE C37.95 IEEE Guide for Protective Relaying of Utility-Consumer Interconnections w) IEEE Std. C37.102 IEEE Guide for AC Generator Protection x) IEEE Std C62.41: IEEE Recommended Practice on Surge Voltages in Low-Voltage AC Power Circuits y) NERC PRC-024-1: Generator Frequency and Voltage Protective Relays z) NFPA 70: National Electrical Code aa) UL 1741: Inverters, Converters, Controllers and Interconnection System Equipment for use with Distributed Energy Resources . 2.2 Definitions The following definitions will be used throughout this document. • ANSI-American National Standards Institute • FCU-Fort Collins Utility Services • GF-Generating facility • IEEE-Institute of Electrical and Electronic Engineers • KVA-Kilovolt-amps • KW-Kilowatt • MW-Megawatt • NEC-National Electrical Code • NEMA-National Electrical Manufacturers Association • NESC-National Electrical Safety Code • Operator-Generating facility owner and operator, successors, heirs, agents, employees, and assigns • PCC-Point of common coupling • UL-Underwriters Laboratories • VAR-Volt-Amps reactive (reactive power) 3.0 GF Equipment and Installation Requirements 3.1 General Requirements The installation of any GF shall meet the relevant requirements of the National Electrical Code (NEC) and the National Electrical Safety Code (NESC). Where required by the municipality, the Operator cleared to move forward with the installation must obtain all necessary building permits, pass all applicable building department inspections, and meet other applicable requirements including but not limited to municipal code and Fort Collins Electric Service Rules and Regulations. Unless otherwise modified in this document, the interconnection must meet the requirements of IEEE Std. 1547. Where the requirements of this document vary from the requirements of IEEE Std. 1547, this document governs. EXHIBIT A Rev 9.0 July 2011 9 The Operator shall be solely responsible for protecting the GF and all associated equipment from abnormal distribution system conditions such as outages, short circuits, voltage or frequency variations, or other disturbances. FCU will not install equipment for the protection of the GF generator or other equipment. The GF equipment must be designed and operated so that it is capable of properly synchronizing the generator to the system, maintaining safe operation of the generation equipment, detecting any unusual operating condition, and disconnecting the generator from the system anytime damage to the generator or other equipment may occur. The equipment protection provided by the Operator will prevent the GF from adversely affecting the distribution system's capability of providing reliable service to other FCU customers. The GF must automatically disconnect itself from the system anytime system conditions are outside the ranges described in this document and is not permitted to reconnect to the system until system conditions return to normal and are maintained within the normal range for a minimum of five (5) minutes. 3.2 Interconnection Disconnect Switch Each GF installation must include a manually operated, lockable, disconnect switch with a visual break. The disconnect switch must be visible and accessible at all times by FCU personnel to allow the GF to be disconnected safely during maintenance or outage conditions. In the case of a PV system this disconnect switch must be located next to the FCU electric meter. In all cases the disconnect switch must be rated to interrupt the maximum output of the generator and must be rated for the voltage and fault current requirements of the GF and must meet all applicable NEMA, UL, ANSI, IEEE, and NEC standards as well as local and state electrical codes. The disconnect switch shall be permanently labeled with text indicating that the switch is for the GF. The labeling shall also clearly indicate the open and closed position of the switch. The disconnect switch must be located on the output or load side of the GF such that the entire GF can be isolated from FCU distribution system. If the site contains several generators, a single disconnect switch may be used providing its rating is sufficient for all generators and opening it produces a visible open point between all generators and the FCU system. Other devices such as circuit breakers or fuses may be considered as a substitute for a disconnect switch if each of the following conditions is met: a) If a circuit breaker is used it is draw-out and capable of being locked into the disconnected position b) If a fuse is used it is capable of being removed from the bus to provide a visual open point c) The Operator or Operator’s agents are available at all times to disconnect and remove this breaker or fuses whenever requested by FCU All lock-out and tag-out capabilities must also be available for the devices used and must be assessable to FCU personnel. 3.3 Dedicated Transformer and Additional Primary Protection If the GF rating is greater than 50kW the GF must be connected to the FCU by a dedicated transformer. The transformer must meet FCU standards and design criteria. The transformer must be labeled according to FCU practices. Most interconnecting transformers on the FCU system are protected with fuses. However, if a GF is rated at 1500 kVA or above, FCU may determine the fuse protection is insufficient to properly protect the FCU system. In this case, FCU may require that a dedicated three-phase interrupting device such as a recloser must be added to the transformer high-voltage side along with necessary relaying.. Moreover, any GF whose connection to the FCU distribution system increases the aggregate generation on any feeder, transformer, or portion of a feeder to 1500 kVA or above is subject to a separate study by FCU, and FCU may require the addition of a three-phase protective device on the primary side of the system. EXHIBIT A Rev 9.0 July 2011 10 3.4 Interrupting Devices Required Circuit breakers or other interrupting devices located at the Point of Common Coupling (PCC) must be certified or "Listed" (as defined in Article 100, the Definitions Section of the National Electrical Code) as suitable for their intended application. This includes being capable of interrupting the maximum available fault current expected at their location. The Operator’s GF Facility and associated interconnection equipment must be designed so that the failure of any single device will not potentially compromise the safety and reliability of FCU’s distribution system. 3.5 System Protective Functions The protective functions and requirements contained in this document are designed to protect FCU’s distribution system and not specifically the Operator’s GF. The Operator is solely responsible for providing adequate protection for the GF and all associated equipment. The Operator’s protective devices must not impact the operation of other protective devices utilized on the FCU distribution system in a manner that would affect FCU's ability to provide reliable service to its customers. The GF’s protective functions must sense abnormal conditions and disconnect the GF from the FCU distribution system during abnormal conditions. All GFs must be capable of sensing line-line-line, line-line, and line-ground faults on the distribution feeder supplying the GF and must disconnect from the line to protect both the line from further damage and the generator from damage due to excessive currents or unusual voltages. The settings of these relays will be coordinated with FCU substation relaying. For induction machines speed matching must be done automatically and shall match speed to less that 5% before closing the associated breaker. The minimum protective functions needed for various types of generators, and other requirements for system protection are shown below. Any machine that is not included in one of the following categories must be individually considered by FCU. 3.5.1 Synchronous Machines above 50kW to 100kW a) Over and under voltage functions (27/59) b) Over current trip functions. (50/51) which may be included in a breaker trip-unit or a fuse. c) Ground fault protection (50/51G) d) Over and under frequency functions. (81O/U) e) Sync Check (25) f) Phase-sequence or negative sequence voltage (47) g) A function to prevent the GF from contributing to the formation of an unintended island and to prevent the GF from reconnecting with the distribution system under abnormal conditions is required. h) Relay settings and test reports will be submitted to FCU for review. FCU will determine if an on-site inspection is required. 3.5.2 Synchronous Machines 100kW to and including 1000kW a) Interrupting devices must be 3-phase circuit breakers with electrical operation. b) Relays must be utility grade (must meet IEEE Std.C37.90, C37.91, C37.92 and C37.93) and must be independent from the generator control devices. c) Over and under voltage functions (27/59) d) Voltage restrained over current trip functions. (50/51V) e) Ground fault protection (50/51G) f) Over and under frequency functions. (81O/U) g) Sync Check (25) h) Phase-sequence or negative sequence voltage (47) EXHIBIT A Rev 9.0 July 2011 11 i) Reverse power (32) j) A function to prevent the GF from contributing to the formation of an unintended island and to prevent the GF from reconnecting with the distribution system under abnormal conditions is required. k) Relay settings and test reports will be submitted to FCU for review. FCU will determine if an on-site inspection is required. 3.5.3 Synchronous Machines 1000kW to and including 5000kW a) Interrupting devices must be 3-phase circuit breakers with electrical operation. b) Relays must be utility grade (must meet IEEE Std.C37.90, C37.91, C37.92 and C37.93) and must be independent from the generator control devices. c) Over and under voltage functions (27/59) d) Voltage restrained over current trip functions. (50/51V) e) Ground fault protection (50/51G) f) Over and under frequency functions. (81O/U) g) Negative Sequence Current (46) h) Loss of Field (40) i) Sync Check (25) j) Phase-sequence or negative sequence voltage (47) k) Reverse power (32) l) A function to prevent the GF from contributing to the formation of an unintended island and to prevent the GF from reconnecting with the distribution system under abnormal conditions is required. m) Relay settings and test reports will be submitted to FCU for review. 3.5.4 Doubly-Fed Induction Machines above 50kW to 100kW a) Over and under voltage functions (27/59) b) Over current trip functions. (50/51) which may be included in a breaker trip-unit or a fuse. c) Ground fault protection (50/51G) which may be included in a breaker trip-unit or a fuse d) Phase-sequence or negative sequence voltage (47) e) Speed matching to within 5% (15) f) If it is determined that it is possible for the machine to self-excite in this installation, the GF must include a function to prevent the GF from contributing to the formation of an unintended island and to prevent the GF from reconnecting with the distribution system under abnormal conditions. If it is determined that the machine cannot self-excite, evidence must be provided to FCU proving that this is the case and anti-islanding protection is not required. If such evidence does not meet FCU approval, anti-islanding protection is required. g) Relay settings and test reports must be submitted to FCU for review. FCU will determine if an on-site inspection is required. 3.5.5 Doubly-Fed Induction Machines 100kW to 5000kW a) Interrupting devices must be 3-phase circuit breakers with electrical operation. b) Relays must be utility grade (must meet IEEE Std.C37.90, C37.91, C37.92 and C37.93) and must be independent from the generator control devices. c) Over and under voltage functions (27/59) d) Over current trip functions. (50/51) which may be included in a breaker trip-unit or a fuse. e) Ground fault protection (50/51G) which may be included in a breaker trip-unit or a fuse f) Phase-sequence or negative sequence voltage (47) g) Negative sequence current (46) h) Over and under frequency (81 O/U) i) Reverse power (32) j) Speed matching to within 5% (15) EXHIBIT A Rev 9.0 July 2011 12 k) If it is determined that it is possible for the machine to self-excite in this installation the GF must include a function to prevent the GF from contributing to the formation of an unintended island and to prevent the GF from reconnecting with the distribution system under abnormal conditions. If it is determined that the machine cannot self-excite, evidence must be provided to FCU proving that this is the case and anti-islanding protection is not required. If such evidence does not meet FCU approval, anti-islanding protection is required. l) Relay settings and test reports must be submitted to FCU for review. FCU will determine if an on-site inspection is required. 3.5.6 Induction Machines above 50kW to 100kW a) Over and under voltage functions (27/59) b) Over current trip functions. (50/51) which may be included in a breaker trip-unit or a fuse. c) Ground fault protection (50/51G) which may be included in a breaker trip-unit or a fuse d) Phase-sequence or negative sequence voltage (47) e) Speed matching to within 5% (15) f) If it is determined that it is possible for the machine to self-excite in this installation the GF must include a function to detect and trip the unit during a self excited condition. This will prevent system over voltages and also prevent the GF from contributing to the formation of an unintended island. If it is determined that the machine cannot self-excite, evidence must be provided to FCU proving that this is the case and this protection is not required. If such evidence does not meet FCU approval, anti-islanding protection is required. g) Relay settings and test reports must be submitted to FCU for approval. FCU will determine if an on-site inspection is required. 3.5.7 Induction Machines 100kW to 5000kW a) Interrupting devices must be 3-phase circuit breakers with electrical operation. b) Relays must be utility grade (must meet IEEE Std.C37.90, C37.91, C37.92 and C37.93) and must be independent from the generator control devices. c) Over and under voltage functions (27/59) d) Over current trip functions. (50/51) which may be included in a breaker trip-unit or a fuse. e) Ground fault protection (50/51G) which may be included in a breaker trip-unit or a fuse f) Phase-sequence or negative sequence voltage (47) g) Negative sequence current (46) h) Over and under frequency (81 O/U) i) Reverse power (32) j) Speed matching to within 5% (15) k) If it is determined that it is possible for the machine to self-excite in this installation the GF must include a function to detect and trip the unit during a self excited condition. This will prevent system over voltages and also prevent the GF from contributing to the formation of an unintended island. If it is determined that the machine cannot self-excite, evidence must be provided to FCU proving that this is the case and this protection is not required. If such evidence does not meet FCU approval, anti-islanding protection is required. l) Relay settings and test reports will be submitted to FCU for review. FCU will determine if an on-site inspection is required. 3.5.8 Inverter Connected Systems 1000 kW and Below This may include photovoltaic systems (PV), some wind turbines, fuel cells, microturbines and all other machines that deliver their power to the utility system via an inverter or converter utilizing power electronics. EXHIBIT A Rev 9.0 July 2011 13 a) The Inverter must be tested to meet IEEE 1547, and IEEE 1547.1. One way to meet this requirement is to be tested to UL1741. However, it is not required that this testing be done by Underwriters Laboratories. Any recognized testing lab which confirms that the inverter meets IEEE 1547, and IEEE 1547.1 is satisfactory. If the inverter does not carry a UL sticker, FCU must be supplied with a letter from the manufacturer or an independent testing laboratory stating the inverter has been tested and meets the above IEEE standards. b) FCU will require over current trip functions (50/51) which may be included in a breaker trip-unit or a fuse. This device must be separate from the inverter control system and internal disconnect device. c) FCU will determine if an on-site inspection is required to observe calibration and testing of the inverter functions. 3.5.9 Inverter Connected Systems above 1000 kW to 5000kW This may include photovoltaic systems (PV) some wind turbines, fuel cells, microturbines and all other machines that deliver their power to the utility system via an inverter or converter utilizing power electronics. a) The Inverter must be tested to meet IEEE 1547, and IEEE 1547.1. One way to meet this requirement is to be tested to UL1741. However, it is not required that this testing be done by Underwriters Laboratories. Any recognized testing lab which confirms that the inverter meets IEEE 1547, and IEEE 1547.1 is satisfactory. If the inverter does not carry a UL sticker, FCU must be supplied with a letter from the manufacturer or an independent testing laboratory stating the inverter has been tested and meets the above IEEE standards. b) FCU will require over current trip functions (50/51) which may be included in a breaker trip-unit or a fuse. This device must be separate from the inverter control system and internal disconnect device. c) Ground fault protection (50/51G) which may be included in a breaker trip unit. This device must be separate from the inverter control system and internal disconnect device. d) Over and under frequency (81 O/U). This device must be separate from the inverter control system and internal disconnect device. e) Over and under voltage functions (27/59). This device must be separate from the inverter control system and internal disconnect device. f) FCU will determine if an on-site inspection is required to observe calibration and testing of the inverter and relay functions. 3.5.10 All machines above 5000kW Any type of GF of this size must be studied and considered individually by FCU. 3.6 Momentary Paralleling Generation Facilities At times an Operator may decide to install a system that may operate parallel to the FCU system only momentarily (normally less than 0.1 seconds). With FCU’s approval, the transfer switch or system used to transfer the Operator’s loads from FCU’s distribution system to the Operator’s GF may be used in lieu of the protective functions required for parallel operation. 4.0 Facility Grounding In all cases the GF grounding system must not adversely impact FCU grounding or ground fault protective relaying. The GF grounding must not cause high voltages to occur under any condition either normally occurring or occurring during a system fault such as allowing high voltages to exist on the un-faulted phases during a single-line-to-ground fault. EXHIBIT A Rev 9.0 July 2011 14 4.1 Equipment Bonding Conductor The Operator must install an equipment-grounding conductor, in addition to the ungrounded conductors and grounded conductor (neutral), between the GF and the distribution system. The grounding conductor must be permanent, electrically continuous, and must be capable of safely carrying the maximum fault current that could be imposed it by the systems to which it is connected. Additionally, the equipment-grounding conductor must be of sufficiently low impedance to facilitate the operation of over current protection devices under fault conditions. All conductors shall comply with the National Electrical Code (NEC). The GF must not be designed or implemented such that the earth becomes the sole fault current path. 4.2 Surge Protection It is strongly recommended but not required that a surge protective device (SPD) be utilized to protect GF equipment. 4.3 System Grounding FCU maintains an effectively grounded distribution system and requires that all GFs be designed to contribute to an effectively grounded system. Effective grounding prevents the occurrence of excessively high voltages during ground faults and protects existing FCU equipment. Effective grounding of the GF may desensitize existing FCU ground fault protection, which could require FCU ground fault relay settings changes or modifications in the design of the GF. The transformer supplied to interconnect the GF voltage to the FCU system will normally be a grounded-wye to grounded-wye transformer. This connection will not provide a grounding source by itself and will not provide an effectively grounded system from the GF side of the interconnection unless effective grounding of GF is provided. When designing the grounding system for the GF, the designer should consider the condition that will result when a ground fault occurs on the line serving the GF. This ground fault would be cleared on the FCU side of the line by opening a breaker or recloser in the FCU substation. This will result in momentarily islanding the line on the GF until it opens its breaker. Under this condition, where the line is islanded and being supplied by the GF, the system must remain effectively grounded. Effective grounding shall be defined by IEEE Std.142 which states that to be considered effectively grounded both of the following two conditions must be met: a) The ratio of zero-sequence reactance to positive-sequence reactance (X0/X1) must be positive and three or less. b) The ratio of zero-sequence resistance to positive-sequence reactance (R0/X1) must be positive and less than 1. The GF system equivalent (Thevenin equivalent) impedance must meet the criteria for effective grounding stated above. The networks used in determining this impedance, and other fault current calculations for the plant, will include the positive, negative, and zero sequence networks of the step- up transformer connected to the FCU system, all other transformers between the generator and the point of common coupling, the generator subtransient, positive, negative and zero sequence values, the neutral grounding device for the generator, the grounding transformer and neutral grounding device (if used) and any significant cable runs. The GF shall maintain an effectively grounded system under normal operating conditions while operating in connection with FCU lines. The short circuit contribution ratio (SCCR) of the GF is defined as the ratio of the GF short circuit contribution to FCU’s contribution to a short circuit (IscGF/IscFCU) for either a three-phase or single- line-to ground fault measured at the high voltage side of the transformer stepping up from the generation voltage to the FCU voltage. The GF must be grounded in such a way that the SCCR for a line-ground fault calculated at the high voltage side of the transformer connecting the GF to FCU is less than 3% while still achieving effective grounding as defined above. If this SCCR ratio is greater than 3% FCU must do a study to EXHIBIT A Rev 9.0 July 2011 15 determine if re-setting ground fault relays on the existing FCU system is required. In rare cases connecting a certain GF to a particular feeder may not be practical due to protection issues or special protection techniques may be needed to make the connection safe. Proper grounding of the GF can be achieved in a number of ways. FCU may at its discretion accept any of the following methods: a) Solidly grounding the generator or installing a solidly grounded grounding transformer (zig-zag or grounded wye-delta transformer). While a solidly grounded generator is acceptable to FCU if all other requirements are met, it must be used with care. ANSI standards generally require that for a synchronous generator the ground fault current must be limited to the three-phase fault current. This usually requires a resistance or reactance be used for grounding the generator neutral. Also, a solidly grounded generator may conduct large amounts of harmonic currents. There may be some unbalanced voltage at the terminals of the generator. This can cause circulating current through the generator if it is solidly grounded which may make de-rating of the generator necessary. If a solidly grounded system is used the designer must consider and plan for all issues that may result. b) Resistance grounding. A resistance grounded generator or grounding transformer with a resistance placed between neutral and ground may be used if it meets the requirements of effective grounding. c) Reactance grounding. A reactance grounded generator or grounding transformer with a reactor between the transformer neutral and ground may be used if it meets the requirements of effective grounding. d) Other methods may be suggested for consideration by FCU. If the Operator desires to generate at the FCU primary voltage and to connect the generators directly to the FCU system without the use of an interconnecting transformer, FCU must first conduct a study of the connection. FCU will determine, as a result of the study, the grounding and other requirements necessary for this type of connection. 5.0 Prevention of Interference and Unacceptable Operating Conditions The Operator must not operate the GF in any way that causes a system disturbance or that superimposes a voltage or current upon FCU’s distribution system that results in interference with FCU operations, service to FCU’s customers, or other FCU equipment and facilities. When FCU suspects that interference with electric service to other FCU customers is occurring, and such interference exceeds FCU Standards, FCU reserves the right at its expense to install special test equipment as may be required to perform a disturbance analysis and monitor the operation of the GF to evaluate the quality of power produced. If the GF is demonstrated to be the source of the interference, and it is demonstrated that the interference produced exceeds FCU Standards or generally accepted industry standards, FCU may, without liability, disconnect the GF from the FCU distribution system.It shall be the responsibility of the Operator to eliminate any interference caused by the GF and the Operator must diligently pursue and take corrective action, at the Operator’s own expense, to eliminate undesirable interference caused by the GF. The GF will be reconnected to the FCU system only after the Operator demonstrates to the satisfaction of FCU that the cause of the interference has been remedied. The Operator’s protective devices must prevent the GFs from contributing to an island. If the FCU feeder to which the GF is connected is de-energized for any reason, the GF must sense this and disconnect itself within 2 seconds of the de-energization of the feeder. EXHIBIT A Rev 9.0 July 2011 16 5.1 Voltage Regulation The GF shall not actively regulate the voltage at the point of common coupling (PCC) unless the effects of this are first reviewed and approved by FCU. If a study has been done by FCU which determines that it is advantageous for a GF to actively control its voltage, FCU will inform the Operator and the Operator will be required to control the GF’s terminal voltage. 5.2 System Voltage The voltage operating range limits for GFs shall be used as a protection function that responds to abnormal conditions on FCU’s distribution system. The FCU voltage operating range is normally - 95% to 105% of the nominal voltage at the electrical service point, and 92% to 105% of nominal voltage at the utilization point, as required by ANSI C84.1. All GFs must be capable of operating within the voltage range normally experienced on FCU’s distribution system. Ocassional excursions outside this range may occur, and tripping of the GF is not suggested until the voltage range is less than 88% or more than 110% of the nominal voltage. The operating range and GF protection shall be selected in a manner that minimizes nuisance tripping between 88% and 110% of nominal voltage. GFs must not energize or, after a trip, re-energize FCU’s circuits whenever the voltage at the PCC deviates from the allowable voltage operating range allowed by ANSI C84.1 Table 1 voltage range (95-105% of nominal voltage at the service or 92-105% of nominal voltage at the utilization point). Whenever the FCU distribution system voltage at the PCC varies from normal (nominally 120 volts) by the amounts as set forth in Table 5-1 the GF’s protective functions shall disconnect the generator(s) from the FCU distribution system with delay times no longer than those shown. Table 5-1: Voltage trip settings. (Adapted from IEEE 1547-2003 and ANSI C84.1-2006) Voltage at Point of Common Coupling (% of base Voltage) Maximum Tripping Time Delay (seconds/cycles) V-PCC < 50% 0.16 / 10 50% < V-PCC < 88% 2.0 / 120 92% < V-PCC < / 105% Normal operating range 110% < V-PCC < 120% 1.0 / 60 120% < V-PCC 0.16 / 10 5.3 System Frequency The GF shall operate in synchronism with the FCU distribution system. Whenever FCU’s distribution system frequency at the PCC varies from normal (nominally 60 Hertz) by the amounts as set forth in Table 5-2 the GF’s protective functions shall disconnect the generator(s) from the FCU distribution system with delay times no longer than those shown. Table 5-2: Frequency Settings (Adapted from IEEE 1547-2003 and NERC PRC-024-1) GF Facility Size Frequency (Hz) Maximum Tripping Time Delay (sec./cycles) GF<59.3 0.16/10 59.3 ≤ GF ≤ 60.5 Continuous Operation GF 30kW or Less GF>60.5 0.16/10 GF<57.8 0.16/10 57.8 ≤ GF ≤ 58.0 4/240 58.0 < GF ≤ 58.5 40/2,400 GF > 30kW 58.5 < GF ≤ 59.0 200/12,000 EXHIBIT A Rev 9.0 July 2011 17 59.0 < GF < 59.5 1,800/108,000 59.5 ≤ GF ≤ 60.5 Continuous Operation 60.5 < GF ≤ 61.5 600/36,000 61.5 < GF 0.16/10 Unless some other anti-islanding scheme is employed, the GF should disconnect due to low frequency resulting from islanding the feeder load on the GF. The frequency settings must be adjusted to insure that, during the lowest loading level on the feeder, the resulting frequency change of the GF when it is islanded with those feeder loads , should cause the under frequency relaying to disconnect the the generators within two seconds. 5.4 Synchronization Synchronous machine automatic synchronizers and sync-check relays must be set as shown in Table 5-3. Table 5-3: Synchronizer/sync check relay settings. (Adapted from IEEE 1547-2003) Rating of GF (kVA) Maximum Slip Rate (Hz) Maximum Voltage Difference (%V) Maximum Phase Angle Difference (deg). 0-500 0.3 10 20 500-1500 0.2 5 10 1500 and above 0.1 3 10 5.5 Flicker Any voltage flicker at the PCC caused by the GF should not exceed the limits defined by the “Maximum Borderline of Irritation Curve” identified in IEEE 519, IEEE 141, and IEE 1453. This limit is shown in Figure 5-1. This requirement is necessary to minimize the adverse voltage effects which may be experienced by other customers on the FCU distribution system due to the operation of the GF. Induction generators may only be connected to the system and brought up to synchronous speed (as an induction motor) if these flicker limits are not exceeded. EXHIBIT A Rev 9.0 July 2011 18 Figure 5-1: Allowable voltage flicker vs. time (reproduced from IEEE Std. 141). 5.6 Harmonics Harmonic distortion measured at the PCC must be in compliance with IEEE 519 and IEEE 1547. Harmonic current injection limits are shown in Table 5-4. Table 5-4: Maximum harmonic current distortion as a percentage of fundamental frequency at the point of common coupling. (Adapted from IEEE 1547-2003) Individual Harmonic Order h (Odd Harmonics Only) h<11 11≤h<17 17≤h<23 23≤h<35 35≤h TDD 4.0 2.0 1.5 0.6 0.3 5.0 The even harmonic limits must be 25% of those shown in Table 5-4. GF’s must not inject direct current greater than 0.5% of rated output into the FCU distribution system. Any device causing a DC offset such as a half-wave converter shall not be allowed. 5.7 Power Factor The power factor at the point of common coupling (PCC) with FCU (the low voltage terminals of the transformer connecting the GF to FCU) shall always remain within 0.95 lagging (VARs going into the site) to 0.95 leading (Vars going out of the site). The only exception to this requirement is a GF consisting of an inverter connected generator 10 kW or less. For this exception it is expected that the site power factor will deteriorate anytime the GF is operating, and FCU will provide the VARs needed at the site. However the site power factor must be maintained such that it would remain within the limits stated above if the GF was not operating and, as a result, the power factor was allowed to revert to the value it had before the GF was added. EXHIBIT A Rev 9.0 July 2011 19 a) Each synchronous generator in a GF shall be capable of operating at any point within a power factor range of 0.95 leading (Vars going into the generator) to 0.95 lagging (Vars going out of the generator). Synchronous generators should automatically control power factor and should be set to deliver VARs to the system as needed to keep the power factor at the PCC with FCU to the range required by this section. For generators other than synchronous generators, operation outside this power factor range is acceptable provided the cumulative power factor of the customer’s entire facility is kept within the range noted. This may be done using capacitor banks, controlling the inverter settings, adding static VAR compensators (SVC) or synchronous condensers, or other means agreeable to both the GF and FCU. If capacitor banks are used they shall be sized and installed per IEEE Stds. 18, 1036, C37.012, C37.06, C37.66, and 1015. Capacitors may need to be stepped and switched to meet the power factor requirements above. Before the addition of capacitors the GF should completely study the effects of the capacitor additions on the resonance conditions and harmonic values that will result. If the GF’s addition of capacitors causes adverse resonance or harmonics effects on FCU’s system, the GF shall be required to pay for any modifications needed to mitigate the problem. 6.0 Monitoring Provisions The following monitoring and metering requirements must be met by any Operator connecting a GF to the FCU system. . 6.1 Metering GFs larger than 10kW and less than or equal to 100 kW require a minimum of a form 9s metering installation. GFs larger than 100 kW will require revenue metering capable of recording the following components: a) Time of use (TOU) b) Harmonic measuring capability c) Four quadrant capability d) MV90 capable e) Form 9S f) The revenue meter must measure the aggregate load of the Operator’s facility including the GF. 6.2 Monitoring and Control Requirements Each non-inverter connected generating facility of 100 kW or larger shall be required, at the discretion of FCU, to have FCU supplied equipment that will be used for monitoring and control of the facility. The Operator shall be responsible for all hardware, software, and any installation costs of FCU provided equipment associated with the co-gen installation. FCU will provide a remote monitoring and control equipment enclosure containing the following equipment at the Operator’s expense: • 900 MHZ spread spectrum radio • SEL 351 relay • Terminal blocks as required • Various control switches, CT blocks, etc as required EXHIBIT A Rev 9.0 July 2011 20 • UPS power supply with battery backup A YAGI antenna will be provided and shall be installed by the Operator at a location designated by FCU. The Operator will be responsible for installing the antenna coax specified by FCU. The Operator must use a certified installer to terminate the coax. The Operator shall also be responsible for mounting the equipment enclosure. The monitoring and control system shall be designed to allow FCU to perform the following: • Trip the generator breaker for unstable system conditions such as frequency, voltage and fault conditions • Place a HOT LINE TAG on the generator breaker that would block its close circuit to prevent its closing • Initiate a generator startup thru SCADA for future power dispatching by FCU (This would normally be blocked locally unless requested by the Operator.) • Monitor the generator breaker status to determine if the generator is on or off line • Monitor generator output power(real and reactive), voltage, harmonics etc. (This will require current and voltage inputs from the GF equipment.) The GF Operator must provide all the necessary interface design to accomplish the functions listed above. The GF Operator must submit drawings of the proposed design to FCU for review. 7.0 Testing 7.1 Commissioning Tests In addition to any commissioning tests required by the owner of the GF or manufacturer of equipment used, the following tests must be performed before operation of the GF. The Operator must notify FCU two weeks in advance of the time of the testing so that a FCU representative may observe any tests required by FCU. a) Visual inspection to ensure proper grounding. b) Visual inspection shall confirm the presence of the isolation device described in section 3.2 and the device shall be tested for operation. c) Trip tests must be performed to prove each device which is required to trip any breaker is capable of doing so. d) Relays or protective functions provided by the generator manufacture must be tested and relay test reports must be made available to FCU. All of the functions required in Section 3.5 must be tested. Inverter connected devices tested by an independent testing laboratory as required in Section 3.5 are not be required to perform this test. e) In the case of a synchronous generator the Operator must prove that the generator is connected to the system with the proper phase rotation and that all three phases of generator voltage match those of the system at the same instant in time. This test is commonly known as “phasing out” the generator. f) In the case of a synchronous generator the Operator must prove that the generator synchronizer and sync check relay is capable of connecting the generator to the system properly and in synchronism. This test must be done before the generator is allowed to actually connect to the system. g) The ability of the control system to disconnect the generator within two seconds in the event of islanding must be tested. 7.2 Periodic Maintenance Tests An Operator must maintain his or her equipment in good order and in compliance with all manufacturers suggested periodic maintenance. If it is discovered that an Operator is not properly maintaining his or her equipment, FCU may disconnect the GF until such time that the Operator can prove that he or she has provided all required maintenance needed to allow the GF to operate properly and safely. EXHIBIT A Rev 9.0 July 2011 21 FCU reserves the right to inspect the GF equipment whenever it appears the GF is operating in a manner that is hazardous to the FCU system. Functional testing must be performed every year to prove the proper operation of the isolation device and all breakers and relays. For all GFs consisting of synchronous machines with aggregate ratings of larger than 1000kW, no less than once every three years all protective functions must be re-tested and calibrated to prove their operation complies with the requirements contained in this document. The Operator must maintain written records of these tests and these records will be made available to FCU on request. Battery systems used for generator control or protective relaying must be maintained and periodically tested as suggested by the battery manufacturer. 7.3 Qualified Personnel All testing and calibration shall be done by qualified personnel. FCU will provide a list of contractors qualified to provide this service. 8.0 Design Changes After the GF begins operation any design changes, such as the addition of more generation, must be submitted to FCU for review. Protective devices or any other requirements listed in this document must not be modified or their settings changed without approval of FCU. 9.0 Liability and Insurance In no event shall FCU be held responsible for the safety, reliability, design, or protection of the GF. Compliance with these interconnection standards does not mean the GF is safe to operate and the Operator is solely responsible for making a determination about whether the GF is safe to operate. Nothing herein shall be construed to create any duty to, any standard of care with reference to, or any liability to any person who is not a party to an arrangement or agreement between FCU and the Operator pursuant to these requirements. FCU is not liable for damages caused to the facilities, improvements or equipment of the Operator by reason of the operation, faulty operation or non- operation of FCU facilities. To the extent permitted by law, tThe Operator shall be solely responsible for and shall defend, indemnify and hold FCU harmless from and against any and all claims or causes of action for personal injury, death, property damage, loss or violation of governmental laws, regulations or orders, which injury, death, damage, loss or violations occurs on or is caused by operation of equipment or facilities on the Operator’s side of the point of connection. Notwithstanding the above and to the extent permitted by law, the Operator shall be solely responsible for and shall defend, indemnify and hold harmless FCU from and against any and all claims or causes of action for personal injury, death, property damage or loss or violation of governmental laws, regulations or orders, wherever occurring, which injury, death, damage, loss or violation is due solely to the acts of omissions of such Operator, including but not limited to the use of defective equipment or faulty installation or maintenance or equipment by such party. However, nothing contained in this section shall be construed as relieving or releasing either party from liability or personal injury, death, property damage or loss, or violation of governmental laws, regulations or orders, wherever occurring, resulting from its own negligence or the negligence of any of its officers, servants, agents or employees. In the event of concurrent negligence, liability shall be apportioned between the parties according to each party’s respective fault. Neither the Operator nor FCU shall be liable to the other or any other third party, in contract or in tort or otherwise, for loss of use of equipment and Deleted: T Deleted: EXHIBIT A Rev 9.0 July 2011 22 related expenses, expense involving cost of capital, claims of customers of FCU or the Operator, as applicable, loss of profits or revenues, cost of purchase or replacement power, or any indirect, incidental or consequential loss or damage whatsoever. The Operator shall pay all costs that may be incurred by FCU in enforcing the indemnity described herein. Each party’s liability to the other party for any loss, cost, claim, injury, liability, or expense, including reasonable attorney’s fees, relating to or arising from any act or omission in its performance of this agreement, shall be limited to the amount of direct damage actually incurred. In no event shall either party be liable to the other party for any indirect, incidental, special, consequential, or punitive damages of any kind whatsoever. For systems of ten kW or more, the Operator, at its own expense, except when the Operator is a governmental entity that self-insures in accordance with Colorado law, shall secure and maintain in effect during connection of its GF to the FCU system, liability insurance with a combined single limit for bodily injury and property damage of not less than $300,000 (Three Hundred Thousand Dollars) each occurrence. Such liability insurance shall not exclude coverage for any incident related to the subject GF or its operation. Except when the Operator is a governmental entity that self-insures in accordance with Colorado law, FCU shall be named as an additional insured under the liability policy. For systems above 500 kW and up to one megawatt, the Operator, at its own expense, except when the Operator is a governmental entity that self-insures in accordance with Colorado law, shall secure and maintain in effect during connection of its GC to the FCU system, liability insurance with a combined single limit for bodily injury and property damage of not less than $2,000,000 (Two Million Dollars) for each occurrence. Insurance coverage for systems greater than one megawatt shall be determined on a case-by-case basis by FCU and shall reflect the size of the installation and the potential for system damage. Any insurance policy required herein shall include that written notice be given to FCU at least 30 days prior to any cancellation or reduction of any coverage. Such liability insurance shall provide, by endorsement to the policy, that FCU shall not by reason of its inclusion as an additional insured incur liability to the insurance carrier for the payment of premium of such insurance. A copy of the liability insurance certificate must be received by FCU prior to GF operation. Certificates of insurance evidencing the requisite coverage and provision(s) shall be furnished to FCU prior to date of interconnection of the generation system. FCU shall be permitted to periodically obtain proof of current insurance coverage from the Operator in order to verify proper liability insurance coverage. The Operator will not be allowed to commence or continue interconnected operations unless evidence is provided that satisfactory insurance coverage is in effect at all times. EXHIBIT A Rev 9.0 July 2011 23 APPENDIX A-TYPICAL ONE-LINE INDUCTION GENERATOR BETWEEN 50KW AND 100KW EXHIBIT A Rev 9.0 July 2011 24 APPENDIX B-TYPICAL ONE-LINE INVERTER CONNECTED GENERATOR BELOW 1000KW. EXHIBIT A Rev 9.0 July 2011 25 APPENDIX C-TYPICAL ONE-LINE SYNCHRONOUS GENERATOR 50KW AND ABOVE EXHIBIT A Rev 9.0 July 2011 26 APPENDIX D-TYPICAL ONE-LINE INDUCTION GENERATOR LARGER THAN 100KW EXHIBIT A Rev 9.0 July 2011 27 APPENDIX E-TYPICAL ONE-LINE INVERTER CONNECTED GENERATOR LARGER THAN 1000KW EXHIBIT A DATE: July 5, 2011 STAFF: Wanda Krajicek AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 16 SUBJECT First Reading of Ordinance No. 082, 2011, Calling a Special Municipal Election to Be Held in Conjunction with the November 1, 2011 Larimer County Coordinated Election. EXECUTIVE SUMMARY This Ordinance calls a Special Municipal Election to be held in conjunction with the November 1, 2011 Larimer County Coordinated Election, and preserves the opportunity for Council to place initiated or referred issues on the November ballot. If Council decides to place any measures on the ballot it would need to do so no later than at its August 16 meeting. If Council does not take action by ordinance or resolution before the statutory deadline (September 2) to certify ballot language to Larimer County, the election will be cancelled and the provisions of this Ordinance will be of no further force and effect. This Ordinance does not submit a specific measure to the November 1, 2011 ballot. However, a group of citizens is currently circulating an initiative petition proposing a prohibition on the establishment, operation or licensing of medical marijuana centers, optional premises cultivation operations, and medical marijuana-infused product manufacturing within the city of Fort Collins. The deadline to submit the petition to the City Clerk’s Office is July 19, 2011. Adoption of this Ordinance is a required step in preserving the option for City Council to submit the initiated ordinance, and/or any other ballot measures that Council may desire, at the November 1, 2011 Coordinated Election. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. ORDINANCE NO. 082, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS CALLING A SPECIAL MUNICIPAL ELECTION TO BE HELD IN CONJUNCTION WITH THE NOVEMBER 1, 2011 LARIMER COUNTY COORDINATED ELECTION WHEREAS, under Article X, Section 1 of the City Charter, the registered electors of the city have the power to propose a measure to the City Council, and if the City Council fails to adopt such measure, to have the same considered by the electors of the City at the polls; and WHEREAS, an initiative petition proposing a ballot measure that would prohibit the establishment, operation or licensing of medical marijuana centers, optional premises cultivation operations, and medical marijuana-infused product manufacturing within the City of Fort Collins has been approved for circulation and is due to be filed with the City Clerk’s Office on July 19, 2011; and WHEREAS, said petition requests a special election on November 1, 2011; and WHEREAS, while the City Council may, by resolution, submit any question or proposed ordinance or resolution, or submit any initiative or referendum measure, to a vote of the people at a special election at any time prior to the statutory deadline to certify ballot content to the County Clerk, the decision to call a special election must be made by ordinance at an earlier date; and WHEREAS, for the foregoing reasons, the City Council wishes to call a special municipal election on November 1, 2011, to be held in conjunction with the Larimer County Coordinated Election, for the purpose of submitting to the electorate of the City any ballot issues approved by the City Council prior to the deadline for certifying ballot content to the Larimer County Clerk and Recorder. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That a Special Municipal Election in the City is hereby called for Tuesday, November 1, 2011, which shall be held in conjunction with the Larimer County Coordinated Election and conducted in such form as shall be determined by the Larimer County Clerk and Recorder. Section 2. That the provisions of the Uniform Election Code of 1992 are hereby adopted with respect to the conduct of said election in lieu of the provisions of the Municipal Election Code of 1965. Section 3. That, notwithstanding any provision in the State Statutes to the contrary, the City Council may, by resolution, submit to the voters at said election any citizen-initiated or City- initiated measure that complies with the requirements of the City Charter, irrespective of the nature of such measure. Section 4. That the City Clerk is hereby directed to certify the ballot content for the Special Municipal Election to the Larimer County Clerk no later than September 2, 2011. Section 5. That the City Manager is hereby authorized to enter into an intergovernmental agreement with Larimer County for conduct of the election, pursuant to Section 1-7-116(2) of the Colorado Revised Statutes. Section 6. That, in the event that the City Council does not take action by ordinance or resolution prior to September 2, 2011 to submit any ballot measures to the voters at the November 1, 2011 Larimer County General Election, the election provided for herein shall be cancelled and the provisions of this Ordinance shall be of no further force and effect. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. Mayor ATTEST: City Clerk Passed and adopted on final reading this 19th day of July, A.D. 2011. Mayor ATTEST: City Clerk DATE: July 5, 2011 STAFF: Lindsay Kuntz Mark Sears AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 17 SUBJECT Items Relating to the Access Road at Soapstone Prairie Natural Area. A. First Reading of Ordinance No. 083, 2011, Authorizing the Transfer to Larimer County of Public Right-of-Way Easements Acquired by the City for the Reconstruction of Rawhide Flats Road. B. First Reading of Ordinance, No. 084, 2011, Authorizing the Conveyance of Access Easements to Three Private Land Owners within the Soapstone Prairie Natural Area. EXECUTIVE SUMMARY To complete the process of improving Rawhide Flats Road, the City has requested that Larimer County vacate sections of road right-of-way that were abandoned in 2008 when the road was realigned and reconstructed by the City to provide access to Soapstone Prairie Natural Area. The County conditioned its approval of the road improvements on the City’s follow up to request this vacation in order to stop the unnecessary public use of the old abandoned road areas and to allow the land to revert to the surrounding landowner(s). Once the sections of right-of-way are vacated, the ownership will revert to the adjacent landowners. In connection with the vacation of the unneeded sections of right- of-way, the City is proposing to transfer to the County six new right-of-way easements that the City acquired to build the realigned portions of the improved road. This transfer will establish that the easements are held by Larimer County as public road easements for Rawhide Flats Road along with the other segments of the Road, and that the right-of-way being vacated is no longer needed. The City has also asked the County to vacate any remaining public road rights-of-way within Soapstone Prairie Natural Area. This action will establish that Rawhide Flats Road north of the Natural Area boundary line is a private road owned by the City for the sole purpose of providing access to Soapstone Prairie Natural Area. There are currently three property owners with in-holding properties within Soapstone Prairie Natural Area. When this section of Rawhide Flats Road is vacated, these owners will lose their legal access to their properties. In order to continue to provide these owners legal access to their property, the City will need to grant each owner an access easement from the boundary of the Natural Area to their property line. The access easements will follow the same alignment as the existing road on the Soapstone Prairie Natural Area. BACKGROUND / DISCUSSION To provide access to Soapstone Prairie Natural Area, the Natural Areas Program (NAP) reconstructed Rawhide Flats Road to meet the required County road standards. Prior to the reconstruction, the road went through several natural drainage channels. County road standards required the City to realign Rawhide Flats Road in several locations, out of the drainage ways and away from the existing right-of-way. The realignment of the road required the City to acquire six new public right-of-way easements from private property owners. At the time of approval of the new road, the County conditioned its approval on future vacation of the obsolete sections of the old right-of-way. City staff plans to initiate the process of requesting that the County Commissioners vacate the abandoned road rights- of-way in an effort to stop the public use of these old road areas and to allow the land to revert to the surrounding landowner(s). The old road was removed, reseeded with native grass seed, and fenced off. However, neighboring residents have removed the fences and resumed driving across these abandoned rights-of-way, since, technically, they are still public road rights-of-way. City staff is recommending that the City transfer these six right-of-way easements to Larimer County, to establish that these new easement areas are held by Larimer County as public road easements for Rawhide Flats Road, and to affirm that the sections of right-of-way being vacated are no longer needed. July 5, 2011 -2- ITEM 17 The NAP has acquired all the land north of the Natural Area boundary line shown on Attachment 2, with the exception of three privately owned in-holdings. The NAP is requesting the County Commissioners vacate all remaining public rights-of-way, including prescriptive rights, across the land now known as Soapstone Prairie Natural Area. Vacating this right-of-way will establish that Rawhide Flats Road north of the Natural Area boundary line is a private road owned by the City for the sole purpose of providing access to Soapstone Prairie Natural Area. City staff is recommending that the City grant individual access easements to each of the three privately held in-holdings to maintain their ability to legally access their properties across the lower portion of Soapstone Prairie Natural Area. Once the Ordinances have passed, the City will grant the access easements to the private in-holding owners contingent upon the road vacation, initiate the road vacation process with the County, and transfer the six right-of-way easements to the County. ENVIRONMENTAL IMPACTS The abandoned portion of Rawhide Flats Road was reseeded to native grasses and forbs during the construction project. Also, three new stream crossings were constructed as part of the new road construction thereby eliminating three low water crossings. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. BOARD / COMMISSION RECOMMENDATION On June 8, 2011, the Land Conservation and Stewardship Board voted unanimously to approve the recommendation that City Council approve an ordinance authorizing transfer of the six new public right-of-way easements to the County and three access easements to the private in-holding property owners. PUBLIC OUTREACH Property owners surrounding the affected area of Rawhide Flats Road were contacted by mail detailing the City’s plans of vacating the old right-of-way areas. This information also included a detailed map showing the proposed road vacations. ATTACHMENTS 1. Vicinity Map - Soapstone Prairie Natural Area 2. Map of Access Easements and Right of Way Areas to Be Conveyed 3. Map of Right-of-Way to Be Vacated 4. Land Conservation and Stewardship Board Minutes, June 8, 2011 ¹ Soapstone Prairie Natural Area General Location Created by City of Fort Collins Natural Areas - 2011 Project Area Larimer County Meadow Springs Ranch Larimer County CSU City of Loveland Open Space City of Fort Collins NA City of Fort Collins Parks State of Colorado GMA City Limits 0 0.5 1 2 3 4 Miles Soapstone Prairie Natural Area Meadow Springs Ranch (Utilities) Red Mountain Open Space FORT COLLINS Location Map 1 - Soapstone Prairie Natural Area Attachment Location Map 1: ATTACHMENT 2 ATTACHMENT 3 ATTACHMENT 4 Land Conservation and Stewardship Board Wednesday, June 8, 2011 Excerpt - Rawhide Flats Road – Grant Three Access Easements and Rawhide Flats Road - Transfer Acquired Easements to Larimer County • Program Sears: To (NAP) provide reconstructed access to soapstone the Rawhide Prairie Flats Natural road Area; to meet the the Natural required Areas County road road easements standards. went The existing down through road in several an attempt natural to stay drainage with in channels. or near In the order existing to meet road out the of County the drainage road standards ways and the away City from was required the existing to realign right-of-Rawhide way in several Flats County The property locations; County Commissioners owners. which Attorney required has to asked the vacate city the the to City acquire un-necessary to initiate six new the abandoned easements process road of from requesting rights-private of-the way that unnecessary are no longer public needed use of for these Rawhide easements, Flats and Road; return which the it abandoned is hoped will right-stop of-way the to In the order appropriate for the County private Commissioners land owners. to vacate the easements, the City must grant to maintain individual their access ability easements to access their for each properties of the three across privately the lower held portion in holdings, of Soapstone Prairie. The (Rawhide City has Flats asked Road) Larimer within County Soapstone to vacate Prairie the Natural right-of-Area, way and for to County also vacate Road 15 portions Soapstone of Prairie the County Natural Road Area 15 that right-are of-no way longer between needed County for road Road purposes 84 and since the In connection City rebuilt with and these realigned vacations, the road. Cameron moved that the Land Conservation and items Stewardship related to Rawhide Board recommend Flats Road that (the City access Council road to approve Soapstone the following Prairie Natural two Area)1) Transfer : to Larimer County six road easements acquired by the City from private Road. property owners for the realignment and reconstruction of Rawhide Flats 2) within Grant Soapstone access easements Prairie Natural to three Area property (Zimmerman, owners with Bowler parcels and of Noonan.private ) land These easements by the County, would would be on be a a portion private of road Rawhide owned Flats and Road maintained that, following by the City vacation as an access Knowlton road second. to Soapstone It was Prairie unanimously Natural approved. Area. ATTACHMENT 4 • Grimes: Mark please define vacating for me. • typically Sears: What along is there the section now was line dedicated they dedicated approximately 30 feet or 100 more. years When ago and we vacate this there it is will a 30 no foot long public show, easement. on their side of the section line that on this property • Stanley: Are they being vacated by the County? • Sears: maintained The County by the City will of hold Fort the Collins. easement, but it is a public easement privately OF THE COUNCIL ORDINANCE OF THE NO. CITY 083, OF 2011 FORT COLLINS AUTHORIZING EASEMENTS THE ACQUIRED TRANSFER BY TO THE LARIMER CITY FOR COUNTY THE RECONSTRUCTION OF PUBLIC RIGHT OF OF WAY RAWHIDE FLATS ROAD northernin WHEREAS, Larimer County, in 2008, to provide the City better reconstructed access to Rawhide Soapstone Flats Prairie Road Natural (the “Road”)Area; and , located portions WHEREAS, of the Road; in and order to meet the County’s road standards the City was required to realign Road,the the WHEREAS, County conditioned in connection its approval with the on County’s the eventual approval vacation of the of the City’s portions improvements of the Road to that would be abandoned under the new alignment; and from neighboring WHEREAS, property the City owners obtained in six order right-to realign of-way the easements Road (the totaling “Easements”)approximately ; and 33.5 acres of-way WHEREAS, that were abandoned the City in has the asked realignment Larimer County and are to no vacate longer the being portions used of for the the old Road; road and right- transferto WHEREAS, the Easements in to conjunction the County with in order the County’s to appropriately vacation establish process, that City these staff new would sections like of the the Road right-of-are way County being road vacated right-by of-the way County like the are rest no of longer the Road, needed; and and to ensure that the portions of to sell, WHEREAS, convey or otherwise Section 23-dispose 111(a) of of any the and City all Code interests provides in that real the property City Council owned is by authorized the City, provided best interests that of the the City City. Council first finds, by ordinance, that such sale or other disposition is in the COLLINS NOW, as follows: THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT of the City. Section 1. That the transfer of the Easements, as set forth herein, is in the best interests necessary Section to transfer 2. the That Easements the Mayor to is the hereby County authorized on terms and to execute conditions such consistent documents with as this are Ordinance, with the City together Attorney, with determines such additional are necessary terms and or conditions appropriate as to the protect City Manager, the interests in consultation of the City. A.D. 2011, Introduced, and to be considered presented favorably for final passage on first reading, on the 19th and ordered day of July, published A.D. this 2011. 5th day of July, _Mayor ________________________________ ATTEST: _City ___Clerk _________________________ Passed and adopted on final reading on the 19th day of July, A.D. 2011. _Mayor ________________________________ ATTEST: _City ___Clerk _________________________ OF THE COUNCIL ORDINANCE OF THE NO. CITY 084, OF 2011 FORT COLLINS AUTHORIZING LAND HOLDERS THE CONVEYANCE WITHIN THE OF SOAPSTONE ACCESS EASEMENTS PRAIRIE NATURAL TO THREE AREA PRIVATE CountyLarimer WHEREAS, known as Soapstone the City Prairie is the Natural owner of Area certain (the “Natural real property Area”)located ; and in northern including WHEREAS, any prescriptive the City rights, is planning that may to ask remain Larimer within County the boundaries to vacate all of public the Natural rights-Area, of-way, in order Flats Road to ensure north that of any the roads Natural within Area’s the southern Natural Area, boundary, including are private the northern roads owned extension by of the Rawhide City for the sole purpose of providing access to the Natural Area; and withininholdings the WHEREAS, Natural Area there (the are “Properties”)currently three ; and privately-owned parcels of land that are the Properties WHEREAS, would upon no longer the County’s be legally vacation accessible; of the public and rights-of-way within the Natural Area, staff is recommending WHEREAS, therefore, that the City in order grant to provide the property a substitute owners means access of easements access to the across Properties, a portion City of the City’s access road; and incorporated WHEREAS, herein by the reference proposed (the access “Access easements Easements”)are described ; and on Exhibit A, attached and road right-WHEREAS, of-way, and the would Access not Easements give the owners would of be the contingent Properties upon more the rights vacation to use of or the access existing City property than they have prior to the vacation; and to sell, WHEREAS, convey or otherwise Section 23-dispose 111(a) of of any the and City all Code interests provides in real that the property City Council owned is by authorized the City, provided best interests that of the the City City. Council first finds, by ordinance, that such sale or other disposition is in the COLLINS NOW, as follows: THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT interests Section of the City. 1. That the conveyance of the Easements, as set forth herein, is in the best necessary Section to convey 2. the That Easements the Mayor on terms is hereby and conditions authorized consistent to execute with this such Ordinance, documents together as are with such additional terms and conditions as the City Manager, in consultation with the City Attorney, not limited determines to, any necessary are necessary changes or appropriate to the legal to description protect the of interests the Easements, of the City, as including, long as such but changes do not materially increase the size or change the character of the Easements. A.D. 2011, Introduced, and to be considered presented favorably for final passage on first reading, on the 19th and ordered day of July, published A.D. this 2011. 5th day of July, _Mayor ________________________________ ATTEST: _City ___Clerk _________________________ Passed and adopted on final reading on the 19th day of July, A.D. 2011. _Mayor ________________________________ ATTEST: _City ___Clerk _________________________ EXHIBIT A Easement 44 of the acres 6th west P.M.1, , City of being easterly to Larimer the side owner County of of existing E ½ Assessor’s of road NE extending ¼ of Schedule Section north Number 11, as Township or R0599662, from County 11 North, LESS Road Range approximately 15 in 69 the West East ½ Larimer P.Township NumberSchedule 68 Schedule Sectionall M.of West , the being 12, County, Northeast R0599603, of Number 11 Township the Larimer North, 6th Colorado, R0599697, P.¼ and M.Range of County 11 , Section being W North, and ½ 68 Larimer Assessor’s of Larimer West 11, NW Range NE Township ¼ ¼ of County, of 69 & County the Schedule Section W West 6th ½ 11 State P.of Assessor’s of North, M.7, SE the Number of , Township being ¼ Colorado 6th Range of P.Section Schedule M.Larimer R0300381, , 11 69 being (Kurt North, West 7, County Number E. Larimer Township of and and Range the Nancy Assessor’s SW 6th R0599557, County 68 11 Prime ¼ West Zimmerman)North, of Assessor’s Section Meridian, of and Range the 6th 7,: A south perpetual, section non-line exclusive of Secs. access 13 and easement 14, T11N, on, R69W over, under to the and north across section Grantor’s line of Property, Secs. 11 from and 12, the T11N, movedbe R69W or modified. along the existing improved roadway, as the same now exists or may hereafter Easement of the 6th P.2, M.City , Larimer to the owner County, of Colorado E ½ of NW (Janalee ¼ of Section McEwen 13, Bowler)Township : 11 North, Range 69 West A south perpetual, section non-line exclusive of Secs. access 13 and easement 14, T11N, on, R69W over, under to the and north across section Grantor’s line of Property, Secs. 11 from and 12, the T11N, movedbe R69W or modified. along the existing improved roadway, as the same now exists or may hereafter of Easement the 6th P.3, M.City , Larimer to the owner County, of Colorado. S½ of SE ¼ (Kelly of Section Noonan)11, : Township 11 North, Range 69 West A south perpetual, section non-line exclusive of Secs. 13 access and 14, easement T11N, on, R69W over, to under the north and across line of Grantor’s the S ½ of Property, the SE ¼ from of Sec. the 11, moved T11N, or modified. R69W along the existing improved roadway, as the same now exists or may hereafter be DATE: July 5, 2011 STAFF: Helen Matson, Brian Varella, Glen Schlueter AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 18 SUBJECT First Reading of Ordinance No. 085, 2011, Authorizing the Conveyance to Capstone Development Corporation of Three Easements on Stormwater Utility Property at Creekside Park. EXECUTIVE SUMMARY Capstone Development Corporation (“Capstone”) is planning a mixed use development. This Project area is 10.4 acres and is located near Stuart Street and College Avenue. It fronts College Avenue around the Discount Tire property and continues to the west to the railroad. The project area is also at the rear of the Dairy Queen property. This mixed use development is for student housing and retail space. It will have two buildings, 221 dwelling units and 8,000 square feet of new retail space. The retail space will be the first floor of the building fronting on South College Avenue. For this development, Capstone has requested that the City grant Capstone a drainage easement for construction of a new flood control channel, a drainage easement for sheet flows from the adjoining property, and a temporary construction easement to construct a pedestrian trail and an underground stormwater pipe on City-owned property known as Creekside Park. BACKGROUND / DISCUSSION Capstone has been working on this project for a number of years. The project site is currently located in a FEMA regulatory floodway and flood fringe on Spring Creek. Chapter 10 of the Fort Collins City Code does not allow new residential structures in the floodway. To utilize more of its project site, the developer opted to revise flood hazard boundaries. Capstone submitted plans to the City and to the Federal Emergency Management Agency (FEMA), and received a Conditional Letter of Map Revision (CLOMR) from both agencies to move forward with all facets of its project. The floodplain boundaries will be modified through engineered solutions with these CLOMR improvements when completed. With these floodplain changes, Capstone will be able to construct two buildings outside the CLOMR- revised floodway and flood fringe. Capstone has requested that the City grant three easements: a drainage easement for a flood control channel that routes offsite floodwater along the western edge of its site, a drainage easement for local (onsite) runoff and a temporary construction easement for construction of a trail connection and a storm sewer pipe improvement. These easements are located in the low use and low maintenance area of Creekside Park (“Park”). The City’s Stormwater Utility (“Utilities”) purchased this property in 1989 for Spring Creek Improvements. Utilities remain the owner of this property; however, the Parks Department maintains this area as Creekside Park. Details of easement requests are below: Flood Control Channel Easement The flood control channel is required for the project and is part of Capstone’s approved CLOMR. The main purpose of this channel is to contain flood flows that overtop the railroad in 100 year storm events. This channel will also handle off-site flows as well as flows from this project. The flows from the channel will be returned to the main channel at Spring Creek in Creekside Park. The proposed flood control channel runs the length of the Capstone’s property and is over 40 feet wide at its base. There may be a concrete trickle pan in the center of it, and has high performance turf reinforcement mat (TRM) along the rest of the bottom of the channel and the sides over most of Capstone’s property. The channel’s slope decreases substantially as it reaches the Park and it is anticipated that the channel will be dry most of the time. Capstone will be performing flood control channel grading within the Park. When this grading is complete, this area of the Park will be very flat and will not be an active swale except during rainfall events. Capstone may also construct a concrete trickle pan to control the grade, and will install a buried riprap pad at the confluence with July 5, 2011 -2- ITEM 18 the Spring Creek channel. On top of this buried riprap, Capstone will reseed this area in native grasses, as specified in the CLOMR. Capstone will also provide temporary irrigation until the grasses are established. The flood control channel is located at the northwest corner of the Park and is shown in blue on the attached Diagram of Proposed Creekside Park Easements (Attachment 2). The easement is approximately 140 feet wide and contains 8,785 square feet. Sheet Flow Easement The next easement is a sheet flow easement (shown in yellow on Attachment 2). It is directly east of the flood control channel easement and is approximately 160 feet at its widest area and contains 8,140 square feet. This easement is being requested to handle developed runoff from the south parking lot of the Project onto the City’s property to Spring Creek. In the current condition, there is a concrete pan on the Capstone property that takes concentrated flows directly onto the Park. These flows as well as the pedestrian and bike use without a trail has caused erosion at the Park. The Project plans to mitigate adverse impacts from the change in runoff rate and volume. The south parking lot of the Project will be constructed with one foot wide curb cuts at nine feet on center to uniformly distribute the surface runoff to the area south of the curb. As per Best Management Practices (BMP’s), this runoff will then cross a landscape area (the grass buffer) approximately sixty feet wide before the sheet runoffs enter the Park. Grass buffers are densely vegetated strips of grass designed to accept sheet flows from upgradient development. Flows will be distributed in a uniform manner over the width of the buffer, which is preferred over concentrated flows. The grass buffer on the Capstone property will be planted with a Native Prairie Mix and when mature will provide vegetative coverage greater than 80%. Erosion and sediment control measures on upgradient disturbed areas will be maintained to prevent excessive sediment to the grass buffer. The appearance of the Park at this location will remain as it is today. No construction will take place on the easement area for this Project. Temporary Construction Easement (“TCE”) This easement is required for Capstone to construct improvements on the City’s property. Capstone has a trail through its Project which will connect to the Spring Creek Trail near the bridge in Creekside Park. Capstone will construct the trail connection to the City’s specifications. Once constructed, this trail connection will become part of the City’s trail system and will be maintained by the City. There is an old stormwater pipe under the railroad to Capstone’s property. The City has requested that Capstone extend and improve this pipe to flow to Spring Creek. The extended pipe (30-inch diameter or equivalent) will enter the Park upstream of the existing pedestrian bridge and go to Spring Creek. Once the extension is completed, this pipe will be a public pipe owned by the City. The City will be responsible for maintenance of this public pipe. Capstone will be responsible to restore the Park property to its current condition once its construction is complete. The temporary easement area is 9,342 square feet and is the red area on the attached Diagram. FINANCIAL / ECONOMIC IMPACTS Real Estate Services utilized appraisals obtained for adjacent properties for the Mason BRT project to determine the value of these easements. The City property has physical limitations including Spring Creek and the associated buffers and the trail system, which affect the value. The resulting values are: Flood Control Swale Easement $8,785 Sheet Flow Easement 3,258 Temporary Construction Easement 437 Easement Processing Fee - RES 1,000 Total $13,480 July 5, 2011 -3- ITEM 18 STAFF RECOMMENDATION . Staff recommends adoption of the Ordinance on First Reading. Utilities staff has reviewed the request and has not identified any concerns. BOARD / COMMISSION RECOMMENDATION At its June 16, 2011 meeting, the Water Board voted 8-1, to recommend that the Council approve the easement requests from Capstone Development Corporation. ATTACHMENTS 1. Location Map 2. Diagram of Proposed Creekside Park Easements 3. Photo of Area of Impact for each Easement 4. Water Board minutes, June 16, 2011 Diagram of Proposed Creekside Park Easements Choice Center Mixed-Use Redevelopment Type I Jim Sell Design June 28, 2011 Creekside Park Spring Creek Channel Flood Control Channel Sheet Runoﬀ Temporary Construc� on Easement Mason Corridor BRT ATTACHMENT 2 New Building New Building Existing Choice Center Shopping Center Buried Overﬂ ow Pipe Spring Creek Channel Flood Control Channel Sheet Runoff Temporary Construction Easement Jim Sell Design June 28, 2011 Trail Connection Maytag Dairy Queen Discount Tire Stuart Street Diagram of Proposed Creekside Park Easements Choice Center Mixed-Use Redevelopment Type I ATTACHMENT 3 JIM SELL DESIGN 153 WEST MOUNTAIN FORT COLLINS, COLORADO 80524 970.484.1921 Creekside Park Easements Capstone Development Corporation Existing and Proposed Views looking NE from Creekside Park Existing Proposed ATTACHMENT 3 Maytag Dairy Queen (not visible) Mini Storage Spring Creek Creekside Park Property Line Culvert Headwall at RR Embankment Maytag Culvert Headwall at RR Proposed Housing Units (south units depicted) Proposed South Parking Lot Flood Control Channel Sheet Runoff JIM SELL DESIGN 153 WEST MOUNTAIN FORT COLLINS, COLORADO 80524 970.484.1921 Creekside Park Easements Capstone Development Corporation Composite View of Existing Park and Proposed Development (Looking West from Pedestrian Bridge) Existing Condition Proposed Condition ATTACHMENT 3 Proposed landscaping Trees to be removed Tree to remain Existing Tree New Parking Lot Proposed Trail Connection ATTACHMENT 4 1 Excerpt from Unapproved Water Board Minutes, June 16, 2011 Stormwater Easements: Creekside Park (Attachments available upon request). Chairperson Janett noted that this particular location is where five individuals perished in the 1997 flood. She felt it necessary for this particular item to be brought before the Water Board for discussion. Water Engineering and Field Services Operations Manager Jon Haukaas introduced the topic and introduced Floodplain Administrator Brian Varrella and Real Estate Services Manager Helen Matson. Chairperson Janett stated that the action on behalf of the Water Board is for the easements, but she desired the map revision be brought to the board as well for review. Mr. Varrella gave an introduction on the project and introduced Herman Feissner with Capstone Development. Easements in Creekside Park for the Choice Center Development • Purpose of easements in Creekside Park o For routing of offsite floodwater o For drainage of local (onsite) runoff o For construction of storm sewer improvements • Easements requested are on City property o Owned by the Stormwater Utility o Maintained by Parks • Project details in brief o Current site is located in a Federal Emergency Management Agency (FEMA) regulatory floodway and flood fringe on Spring Creek o Project is subject to the safety standards of Chapter 10 of the City Municipal Code o No new residential structures permitted in the floodway • Developer opted to revise flood hazard boundaries o Optimizes constructible area o Requires a Conditional Letter of Map Revision (CLOMR) The proposed project went to the City for review, and to FEMA for final approval. FEMA approved the project in January 2010. The boundaries of the floodplain and flood fringe were modified to make residential housing constructible on this site. The buildings will be outside both boundaries, and the public safety standards of Chapter 10 were satisfied with the CLOMR application. Mr. Varrella explained the map revisions for the board members and the need for the easements. Board discussion: How are the revisions happening to the floodway and the floodplain? It is a combination of fill and a substantial flood control channel. Is this project for residential or commercial use? The developer intends to use the space primarily for student housing. The four-story structure will house approximately 650 individuals. There will also be retail space on the first floor. ATTACHMENT 4 2 Is this the location of the mobile home park destroyed in the 1997 flood? Yes, the proposed site is on that location. A board member raised a question about the pipe under the train tracks. Mr. Haukaas stated there is a smaller pipe to carry flows, and the majority of the flooding occurs from over-topping of the railroad. A flood control channel is being constructed to keep this from happening again. What would keep the trains from derailing if flooding happens again? Mr. Haukaas stated that would be operational on the part of the railroad because the trains would not run if a flood happens. The project would be constructed outside the floodplain and there would no longer be flooding in the area. Mr. Varrella stated the flood control channel has been constructed to safely convey the over- topping flows away from the building in a 100-year flood event. The 1997 flood greatly exceeded the 1 percent annual chance. Stormwater and Floodplain Program Manager Glen Schlueter stated since the time of the 1997 flood, a wall has been constructed on the east side of the embankment and the embankment has been reinforced. What keeps the wall from eroding on the west side? There is no velocity on the west side. How is the water being redirected? The parking lot has been graded so water can no longer touch the buildings from any side. Where does the stormwater go? The water will fall into Spring Creek. As part of the proposed design, the flood control channel will be built so water will continue to drop in. Does the Creekside Park property act as a collection pond for the stormwater? It is not a pond; however, it catches all the running water and directs it under the bridge to College Avenue. What about the possibility of the bridge catching debris? Mr. Varrella stated the high water mark was created by a combination of debris and high discharge. The new structures and the surrounding parking lots will be protected by structurally designed bollards or “car-catchers” designed to catch large debris. Will the control channel be covered? Yes. What is the effect of the Canal Importation Ponds and Outfall (CIPO) project upstream? Mr. Haukaas stated the effect is really minimal and this project is not dependent on CIPO. Mr. Varrella stated improvements made at Spring Canyon Park, Taft Hill Road, and Rolland Moore Park detained water flows, and the 100-year discharge will be reduced from 3,000 cubic feet per second (cfs) to 2,000 cfs by those projects being in place. Has this project received preliminary approval? The project has received conditional approval. Buildings cannot be constructed until the map revision has received final approval and the floodway and flood fringe have been moved off the site. Who is going to pay for the flood control channel? The developer will pay for the channel. ATTACHMENT 4 3 Will the channel be turned over to the City? No, it will be privately owned. The City is only involved in review and inspection. There are no concurrent public projects. Are there any safety issues with individuals entering the channel? Because the slopes are gentle, there should be no safety issues with the channel. How will the project impact water quality? Due to the location, there will be water quality improvements. Chairperson Janett stated this location is a high profile location for the development of student housing because of the 1997 flood. Does the City receive many CLOMRs? Are these normally brought to the Water Board? Mr. Haukaas stated the CLOMRs are handled administratively because approval is required by FEMA. Does City staff review comments before the CLOMRs go to FEMA? Mr. Varrella stated staff approves CLOMRs before they are presented to FEMA. Staff signs that the property is safe from flooding and that areas removed from the floodway are safe from flooding. These certification documents become part of the CLOMR documentation. The City has to approve the CLOMR before it moves forward? Yes. A board member questioned if a 1997 rain event happened again, what would happen with this development in place? Mr. Varrella stated if a similar event happens again, the proposed flood control channel is not designed to carry the flow that would overtop the railroad. Has the City considered what would happen since the other projects upstream would hold back some of the water? Mr. Haukaas stated since the changes have not been recognized yet, it was designed based on current mapping. The City did not calculate for the volume of water from the 1997 flood. Chairperson Janett requested more information on the subject of water quality. Mr. Schlueter explained the concept of the porous landscaped detention area and how water from the construction site will be treated. How is the water treated by running it through porous material? It is treated by an infiltration process of running it through a layer of sand and a layer of peat. A board member questioned the rules about discharging into an impaired stream (Spring Creek) and expressed concerns about pollutants from the development. Has the Total Maximum Daily Load (TMDL) been conducted for Spring Creek? Mr. Haukaas stated that the TMDL rules have not been finalized or put in place yet. Best Management Practices (BMPs) for stormwater quality treatment have been put in place. Mr. Schlueter stated the improvements will be a benefit to the current water quality. Chairperson Janett stated that the board will review the Stormwater Criteria Manual at the July board meeting and requested the current discussion move to the easements. ATTACHMENT 4 4 Ms. Matson introduced the easements: • Easements are requested within Creekside Park o Flood Control Channel connection to Spring Creek - Channel construction is necessary per the CLOMR - Conveys 100-year flows overtopping the adjacent railroad - Must be constructed to tie into the Spring Creek channel o Sheet Flow Easement for onsite local drainage - Adjacent property directs concentrated flow to Creekside Park - Proposed mitigation activities would reduce erosion potential on Creekside Park property - Easement area will not be disturbed during construction o Temporary construction easement for development features - Necessary for construction of permanent improvements to City property • Includes a trail connection from project to existing Spring Creek Trail • Includes an extension of existing underground stormwater pipes from project to Creekside Park - Surface restored by developer, maintained by City Board discussion: Do you have a before and after flood diagram of the Creekside Park area? Mr. Varrella stated a flood diagram was not available for this presentation. He emphasized the current design ensures no impact on water surface elevations on any of the cross sections and this has been documented in the CLOMR. The water will fan out across the area. This design proves that hydraulic conditions would not worsen in the area. Mr. Haukaas stated there is still a main flow coming down the creek and through the culverts underneath. The energy from that is much higher than the overtopping that would come down the channel. Mr. Varrella gave more details about the flow design. What happens next in the process if the Water Board approves or disapproves the easements? Ms. Matson stated the easements go to Council on July 5, 2011 with the Water Board’s recommendations as part of the Agenda Item Summary (AIS). Once the easements are approved, they would go into the planning process. The project has already been approved by the Planning and Zoning Board. Mr. Haukaas stated if the easement is not approved by Council, it would go into an appeal process. Deputy City Attorney Carrie Daggett stated Council is making a legislative decision regarding the project and there are other considerations that Council takes into account when making decisions about these types of easements, including the benefits of the project moving forward. Chairperson Janett stated administrative work typically does not go to Council. The Planning and Zoning Board takes public input and makes decisions yes or no. The Water Board’s role is to act as an advisory panel on the legislative act of the easements. Ms. Daggett stated staff is implementing what is in the City Code in terms of making decisions on applications. If standards are to be applied differently, it may be worthwhile in the future to have the Water Board review changes to the code. ATTACHMENT 4 5 Is the Sheet Flow Easement just an easement to accept sheet flow from the parcel itself? Yes. Has this item been before Council before? No. Can the developer ensure there will not be any further water quality issues for Spring Creek? Mr. Haukaas stated all Chapter 26 code requirements regarding water mitigation have been met by the developer. Will the BMPs remove E. coli from Spring Creek? E. coli is not directly addressed because it requires a higher level of treatment. Vote on the motion: 8 for, 1 against. Reason for the nay vote: Board Member Brunswig: The water quality issues in Spring Creek are not being addressed. The proposed development will impact the future of water quality. Motion: Board Member Brown moved that the Water Board recommend that the City Council consider approval of a Permanent Drainage Easement for a Flood Control Channel as described in Exhibit “A,” a Permanent Drainage Easement for Sheet Runoff as described in Exhibit “B,” and a Temporary Construction Easement as described in Exhibit “C” to Capstone Development Corporation. Board Member Eccleston seconded the motion. ORDINANCE NO. 085, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CONVEYANCE TO CAPSTONE DEVELOPMENT CORPORATION OF THREE EASEMENTS ON STORMWATER UTILITY PROPERTY AT CREEKSIDE PARK WHEREAS, the City owns a parcel of land in the 1800 block of South College Avenue known as Creekside Park (the “City Property”); and WHEREAS, the City Property was purchased by the City’s Stormwater Utility for Spring Creek improvements and is managed by the Parks Department; and WHEREAS, Capstone Development Corporation (“Capstone”) is in the process of developing a mixed use development with student housing and retail space north of the Property near Stuart Street and South College Avenue (“the Project”) and WHEREAS, the property on which the Project would be built (the “Project Property”) is currently in the Spring Creek floodway and Chapter 10 of the City Code does not allow new residential structures in the floodway; and WHEREAS, Capstone chose to revise the flood hazard boundaries of the Project Property in order to remove it from the floodway, and has received from the City and the Federal Emergency Management Agency a Conditional Letter of Map Revision (CLOMR) to proceed with the Project; and, WHEREAS, as part of the CLOMR, Capstone is required to construct a flood control channel to carry flows across the Project Property to the Spring Creek channel; and WHEREAS, to facilitate the operation of this channel Capstone is requesting from the City a permanent non-exclusive easement on the City Property approximately 8,785 square feet in area to channel water across the City Property to Spring Creek during rainfall events (the “Channel Easement”); and WHEREAS, the location of the proposed Channel Easement is shown and described on Exhibit “A”, attached and incorporated herein by this reference; and WHEREAS, as part of its Project, Capstone has also requested a permanent, non-exclusive easement on the City Property approximately 8,140 square feet in area to move sheet flows of storm runoff from a parking lot on the Project Property across the City Property to Spring Creek (the “Sheet Flow Easement”); and WHEREAS, the location of the proposed Sheet Flow Easement is shown and described on Exhibit “B”, attached and incorporated herein by this reference; and WHEREAS, as part of its Project, Capstone has also requested a Temporary Construction Easement on the City Property approximately 9,342 square feet in area to construct a trail connection and a stormwater pipe (the “Temporary Construction Easement”); and WHEREAS, the location of the proposed Temporary Construction Easement is shown and described on Exhibit “C”, attached and incorporated herein by this reference; and WHEREAS, City staff has evaluated the potential impacts of the proposed Easements and does not believe that the Channel Easement, the Sheet Flow Easement or the Temporary Construction Easement would interfere with the intended use of the City Property, either as part of the City’s stormwater utility system or as a park; and WHEREAS, Capstone has agreed to pay the City $12,480 for the Easements and $1,000 for processing its easement request; and, WHEREAS, at its regular meeting on June 16, 2011, the Water Board reviewed the proposed Easements and recommended that the City Council authorize their conveyance; and WHEREAS, Section 23-111(a) of the City Code provides that the City Council is authorized to sell, convey or otherwise dispose of any and all interests in real property owned by the City, provided that the City Council first finds, by ordinance, that such sale or other disposition is in the best interest of the City; and WHEREAS, with respect to property that is part of the City’s water or utility systems, Section 23-111(b) of the City Code requires that the City Council also find that the disposition will not materially impair the viability of the particular utility system as a whole and that it will be for the benefit of the citizens of the City. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the conveyance of the Easements, as set forth herein, is in the best interests of the City, will not impair the viability of the stormwater system, and will be for the benefit of the citizens of the City. Section 2. That the Mayor is hereby authorized to execute such documents as are necessary to convey the Easements to Capstone on terms and conditions consistent with this Ordinance, together with such additional terms and conditions as the City Manager, in consultation with the City Attorney, determines are necessary or appropriate to protect the interests of the City, including, but not limited to, any necessary changes to the legal description of the Easements, as long as such changes do not materially increase the size or change the character of the Easements. -2- Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Jon Haukaas Patrick Rowe AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 19 SUBJECT First Reading of Ordinance No. 086, 2011, Authorizing the Conveyance to Solitaire Homes, LLC of a Public Trail Easement on City Property. EXECUTIVE SUMMARY Solitaire Homes, LLC (the “Developer”) is planning a 27 acre (approximately) development north and west of Laporte Avenue and Taft Hill Road, opposite the Poudre School District offices. To facilitate a planned trail within the development, the Developer requests a 438 square foot public trail easement from the City across City property managed by the Water Utility. The City property is approximately 1,750 square foot. in size and is the site of a Water Utility valve vault. BACKGROUND / DISCUSSION Sanctuary West is a proposed development currently in the final stages of planning review. The development will occupy 27 acres and include 112 residential units. The development is located west of Taft Hill Road and north of Laporte Avenue, opposite the Poudre School District offices (Attachment 1). In order to satisfy a planning connectivity requirement, the development will include a public trail to connect the planned Sanctuary West Development to the existing Green Acres subdivision. The proposed alignment of the trail is located entirely on the development with the exception of a small area (438 square foot) that would cross a portion of City property managed by the Water Utility. The requested easement will allow the developer to avoid increased construction and engineering costs that would result from this portion of the trail falling within a drainage channel should the developer have to relocate the proposed trail. As such, the Sanctuary West Development is requesting a 438 square foot public trail easement from the City. The larger City property that this 438 square foot easement would encumber is approximately 1,750 square foot in size and is the location of a Water Utility valve vault. The valve vault houses gate valves and a control valve on the 27-inch water main that passes through the area. The vault is a typical size and configuration and is secured. Utilities staff has reviewed the plan for the proposed trail access easement and has identified no negative impacts to the Water Utility property as a result of the new easement. FINANCIAL / ECONOMIC IMPACTS Solitaire Homes, LLC will compensate the City of Fort Collins the fair market value of the easement (as determined by the City’s Real Estate Services Department) and a $1,000 processing/administration fee. Using the “across the fence” value methodology, Real Estate Services has calculated the fair market value of the easement to be a $500 (the easement size and adjacent land values support a value less than this amount, but $500 will be utilized as a nominal value). Although the trail will be open to the public, the trail improvements will be owned and maintained by the Sanctuary West development. ENVIRONMENTAL IMPACTS The easement area will be developed consistent with an 8-foot trail, and areas within the easement area disturbed but not improved will be restored to a like or better condition. July 5, 2011 -2- ITEM 19 STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION At its May 26, 2011 meeting, the Water Board recommended by unanimous vote that Council consider approval of the proposed trail easement requested for the Sanctuary West Development, consistent with staff’s recommendation. ATTACHMENTS 1. Location Map 2. Water Board Meeting Minutes, May 26, 2011 3. Easement Area Plan Sketch and Photo ATTACHMENT 2 Excerpt from Water Board Minutes, May 26, 2011 Easement Request for the Sanctuary West Development (Attachments available upon request). Water Engineering and Field Operations Manager Jon Haukaas introduced the topic. The development is located on the north side of Laporte Avenue, west of Taft Hill Road, and opposite the Poudre R1 School District offices. The request is for a Pedestrian Access Easement. City of Fort Collins Utilities has a small piece of property for water valves. A pedestrian trail is needed for the area. Staff has looked at it and believes alignment does not adversely impact any operations from a utility perspective. Staff recommends approval. Board discussion: Is this a permanent easement? There is a fee schedule determined by Real Estate Services plus administrative fees. Real Estate Services has selected a nominal value of $500 plus a $1,000 administrative fee. The total area is 438 square feet. The easement allows the City to build a pedestrian trail and Utilities will still have access to the valve? Yes, the easement allows the City of Fort Collins Utilities to have surface access across the top. Utilities will still have the primary rights. Vote on the motion: It passed unanimously. Chairperson Janett noted that, in a discussion with Utilities Executive Director Brian Janonis, future easements that are non-controversial in nature will be reviewed by staff prior to presentation to the Board. Board Member Brown moved that the Water Board recommend that the City Council consider approval of the proposed pedestrian access easement request for the Sanctuary West Development, consistent with staff's recommendation. Board Member Waskom seconded the motion. Sanctuary West Pedestrian Trail Exhibit VAULT LOCATION PED. TRAIL 8’ SOLDIER CREEK TRAIL EDGE OF SLOPE PLAN VIEW BRIARWOOD ROAD EXISTING CONDITIONS VIEW POINT OF EXISTING CONDITIONS APPROX. PROPERTY LINE PED. TRAIL WATER VAULT N. IMPALA DRIVE ATTACHMENT 3 ORDINANCE NO. 086, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CONVEYANCE TO SOLITAIRE HOMES, LLC OF A PUBLIC TRAIL EASEMENT ON CITY PROPERTY WHEREAS, the City is the owner of a parcel of real property located in the area of LaPorte Avenue and Taft Hill Road in Fort Collins, Colorado, identified in County records as parcel number 97091-03-927 (the “Property”); and WHEREAS, the Property is approximately 1750 square feet in size and is managed by the Water Utility as the site of a valve vault; and WHEREAS, Solitaire Homes, LLC (the “Developer”) is planning a 27 acre development adjacent to the Property called Sanctuary West (the “Development”); and WHEREAS, as a condition of approving the Development, the City is requiring the Developer to provide a trail connecting the Development to another nearby subdivision; and WHEREAS, the Developer has requested from the City a 438 square foot public trail easement on the Property for the purpose of constructing the trail (the “Easement”); and WHEREAS, the location of the proposed Easement is described on Exhibit “A”, attached and incorporated herein by reference (the “Easement Area”); and WHEREAS, the proposed trail would be open to the public but the Developer would own and maintain the trail improvements; and WHEREAS, the Developer would pay the City $500 for the value of the Easement Area and $1,000.00 as an administrative fee to cover the costs of processing the easement request; and WHEREAS, City Utility staff has identified no negative impacts to the Property resulting from the grant of the proposed Easement; and WHEREAS, Section 23-111(a) of the City Code states that the City Council is authorized to sell, convey, or otherwise dispose of any and all interests in real property owned in the name of the City, provided that the Council first finds, by ordinance, that such sale or other disposition is in the best interests of the City; and WHEREAS, Section 23-111(b) of the City Code states that, with respect to real property which is a part of the City’s water or utility systems, the City Council must also find that the disposition will not materially impair the viability of the particular utility system as a whole and that it will be for the benefit of the citizens of the City. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the conveyance of the Easement on the Property to the Developer as provided herein is in the best interests of the City, will not impair the viability of the City’s Water Utility system as a whole, and will be for the benefit of the citizens of the City. Section 2. That the Mayor is hereby authorized to execute such documents as are necessary to convey the Easement to the Developer on terms and conditions consistent with this Ordinance, together with such additional terms and conditions as the City Manager, in consultation with the City Attorney, determines are necessary or appropriate to protect the interests of the City, including, but not limited to, any necessary changes to the legal description of the Easement, as long as such changes do not materially increase the size or change the character of the Easement. Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Exhibit "A" Page 1 of 2 Exhibit "A" Page 2 of 2 DATE: July 5, 2011 STAFF: Ted Shepard AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 20 SUBJECT Resolution 2011-054 Naming Three Alleys Within the Block Bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street. EXECUTIVE SUMMARY The Downtown Development Authority (DDA) is preparing a capital improvement project to enhance three alleys in the block bounded by South College, West Laurel, South Mason and West Olive. In conjunction with this project, the City of Fort Collins is preparing to name these three alleys. The three proposed names are “John Coltrane Alley,” “Ella Fitzgerald Alley” and “Billie Holiday Alley.” The selection of these three names is based on a public outreach process that resulted in a winning theme of eclectic music and art. If approved, the alley naming will simplify way-finding for pedestrians, bicyclists, drivers, delivery personnel and emergency responders. BACKGROUND / DISCUSSION The Downtown Development Authority is continuing its alley improvement program for the 2011 construction season. Similar previous efforts resulted in improved alleys that are attractive, brighter, safer and more heavily traveled. Providing names for these alleys helps the public navigate the City’s urban area and contributes to an overall sense of direction. Naming these alleys is consistent with past practice: Trimble Court, Tenney Court, Old Firehouse Alley, and Montezuma Fuller Alley. Review of the request to name these three alleys has followed the Current Planning Department’s procedures for street naming. Since the alleys fall below the classification of arterial and collector streets, the names do not need to be derived from the approved list of names established by City Code Section 24-91. All directly affected property owners were notified, as well as surrounding property owners. The Poudre Fire Authority and all affected utilities, City departments, and various mapping agencies were notified. All respondents indicated that there are no problems or concerns with the proposed names. The public outreach and name selection process included meetings and mailings with surrounding property owners beginning with a public meeting on March 30, 2011. Participants were first asked to prioritize a theme. Four themes were offered. These themes and their final rank order in the voting, were eclectic music and art, trains, Colorado State University, and history. The process is explained more completely in the Public Outreach section below. FINANCIAL / ECONOMIC IMPACTS There are no negative financial impacts to City of Fort Collins as the cost of installing new street signs will be borne by DDA’s capital project fund. The overall economic health of the City will be enhanced with improved alleys that will benefit the safety and mobility of business owners, employees, customers and the general public. Maintenance of the alleys will be similar to that for the other improved downtown alleys, and funded through the existing contract between the DDA and the City of Fort Collins Parks Department. These improvements may provide a catalyst for private property owners to re-invest and upgrade their properties. ENVIRONMENTAL IMPACTS The environmental impacts are positive. Enhanced alleys will improve drainage, encourage multi-modal travel, and add landscaping. Overall aesthetics will be significantly increased, thus deterring the accumulation of trash and litter. July 5, 2011 -2- ITEM 20 STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BOARD / COMMISSION RECOMMENDATION The DDA Board of Directors’ recommendation/direction was to allow the stakeholders (property owners, business owners, and tenants) to make the decision, and to facilitate the selection through an open house meeting, several letters announcing themes and names, various other contacts, and finally, by a voting process. PUBLIC OUTREACH The public outreach and name selection process consisted of a kick-off public meeting on March 30, 2011 which established four themes as a method for narrowing down the options. A variety of names were suggested for each theme. These themes, and their final rank order in the voting were: eclectic music and art, trains, Colorado State University, and history. This was followed by numerous contacts with the surrounding property owners and included a mail-in survey to 55 stakeholders. Survey results were eclectic music and art - 7 votes, trains - 4 votes, Colorado State University - 4 votes, and history - 1vote, and resulted in the winning theme and three names. Finally, a mailing to affected property and business owners within approximately 800 feet of the subject alleys was sent to inform them about the proposed Resolution on the July 5, 2011 City Council agenda.. RESOLUTION 2011-054 OF THE COUNCIL OF THE CITY OF FORT COLLINS NAMING THREE ALLEYS WITHIN THE BLOCK BOUNDED BY SOUTH COLLEGE AVENUE, WEST LAUREL STREET, SOUTH MASON STREET AND WEST OLIVE STREET WHEREAS, following extensive public outreach and the favorable recommendation of the Board of Directors of the Downtown Development Authority, City staff has brought to the City Council for its consideration the naming of three alleys within the block bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street; and WHEREAS, the naming of the alleys within this block does not implicate the requirements of Section 24-91 of the City Code pertaining to the naming of collector and arterial streets because the alleys do not qualify as collector or arterial streets; and WHEREAS, the Downtown Development Authority has proposed that the alleys in this block be named on the basis of eclectic music and art and that, accordingly, the alleys be named “John Coltrane Alley”, “Ella Fitzgerald Alley” and “Billie Holiday Alley”; and WHEREAS, the City Council has determined that the naming of the alleys in this block as above-provided is in the best interests of the City. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the alleys within the block bounded by South College Avenue, West Laurel Street, South Mason Street and West Olive Street be named “John Coltrane Alley”, “Ella Fitzgerald Alley” and “Billie Holiday Alley” as more particularly shown on the map attached hereto and incorporated herein by this reference as Exhibit “A”. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 5th day of July, A.D. 2011. Mayor ATTEST: City Clerk EXHIBIT A DATE: July 5, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 21 SUBJECT Resolution 2011-055 Authorizing the Mayor to Execute an Amendment to the Intergovernmental Agreement with the Fort Collins Urban Renewal Authority. EXECUTIVE SUMMARY At the June 7, 2011 meeting, Council requested the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that, when the City advances funds to the URA in support of the URA’s activities, a loan agreement and promissory note accompany the advance of funds. BACKGROUND / DISCUSSION Council would like to formalize the process for loaning funds to the URA based on approved projects and eligible costs associated with the development. The URA continues to need funding from the City for projects until such time that the URA can obtain private financing with proven revenue streams sufficient to pay higher interest rates on its loans. The City wants to ensure the funding is appropriately dedicated to a project with a loan agreement and promissory note in place. FINANCIAL / ECONOMIC IMPACTS The URA will need to ensure that sufficient revenues exist to pay back any loans requested of the City. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. ATTACHMENTS 1. Existing IGA between the City and the URA 1 INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND THE FORT COLLINS URBAN RENEWAL AUTHORITY THIS AGREEMENT (“Agreement”) is entered into this ________ day of _______________, 2006, by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation (hereinafter the “City”) and the FORT COLLINS URBAN RENEWAL AUTHORITY, a body corporate and politic in the State of Colorado (hereinafter the “URA”), collectively referred to herein as the “Parties.” RECITALS WHEREAS, the City is a home-rule city and a municipal corporation duly organized and existing under and pursuant to Article XX of the Colorado Constitution and the Charter of the City (the "Charter"); and WHEREAS, the URA is a body corporate and has been duly created, organized, established and authorized by the City to transact business and exercise its powers as an urban renewal authority, all under and pursuant to the Colorado Urban Renewal Law, Section 31-25-101, et seq., Colorado Revised Statutes (the "Act"); and WHEREAS, pursuant to Sections 31-25-107 and 31-25-109 of the Act, the URA has the power and authority to issue or incur notes, interim certificates or receipts, temporary bonds, certificates of indebtedness, debentures, advances, or other obligations, including refunding obligations (collectively, the "Bonds"), for the purpose of financing the activities and operations authorized to be undertaken by the URA with respect to urban redevelopment projects in ac- cordance with an urban renewal plan and the Act, as approved by the City; and WHEREAS, both the Act and Section 18, Article XIV, of the Colorado Constitution authorize the City and the URA to enter into cooperative agreements, such as this Intergovernmental Agreement. WHEREAS, the City and the URA have determined that, for purposes of economy and efficiency of operation, it is in the best interests of the public that the operating staff and resources of the URA be provided by the City, subject to the terms and conditions of this Intergovernmental Agreement (hereinafter referred to as the “Agreement”); and WHEREAS, the City and the URA wish to express their mutual agreement on these matters as more fully set forth herein, and are authorized to enter into this Agreement pursuant to § 31-15-101 and § 31-25-105, C.R.S., respectively. NOW, THEREFORE, it is agreed by the parties as follows: 2 TERMS AND CONDITIONS 1. Definitions The terms used in this Intergovernmental Agreement shall have the meanings set forth in the Act. In addition, for the purposes of this Intergovernmental Agreement, the following terms shall have the meanings set forth below. "Fiscal Year" shall mean the fiscal year of the City, which commences on January 1 of each calendar year and ends on December 31 of the same calendar year. "Incremental Property Taxes" shall mean, for each Fiscal Year subsequent to the creation of any urban renewal area, all Property Tax Revenues in excess of the Property Tax Base Amount for the Urban Renewal Plan Area. "Property Tax" shall mean the real and personal property taxes produced by the levy at the rate fixed each year by the governing bodies of the various taxing jurisdictions within or overlapping the Urban Renewal Plan Area. "Property Tax Base Amount" shall mean the total valuation for assessment as certified by the County Assessor for the City of all taxable property within an Urban Renewal Plan Area as certified by the County Assessor for the City prior to the creation of such area. "Property Tax Revenues" shall mean the amount derived from the levy of Property Tax within any Urban Renewal Plan Area. “Urban Renewal Plan Area” shall mean a slum area, or a blighted area, or a combination thereof which the City Council designates as appropriate for an urban renewal project. 2. URA Employees Provided by City A. The City agrees to provide City staff, including but not limited to staff of the City Manager’s Office, Community Planning and Environmental Services, and Finance Department, and other employees, consultants, and staff (hereinafter collectively referred to as “City Staff”) to the URA on an as-needed basis for the operation and management of URA activities subject to the URA’s reimbursement to the City as provided in Section 5. The City Manager shall serve as the Executive Director of the URA. The City Attorney’s Office shall provide legal services to the URA, with the assistance of such special legal counsel as may be authorized by the City Attorney, as long as the members of the City Council continue to serve ex officio as the members of the URA Board of Commissioners. B. City staff time spent on URA activities shall be separately recorded and specifically documented for purposes of determining the appropriate reimbursement to the City in accordance with Section 5. It is the intention of the parties that the services performed by such employees on behalf of the URA shall not interfere with the ability of such employees to carry out their duties and responsibilities for the City. 3 3. Other Services In addition to providing staff employees for the URA, the City agrees to provide the URA with such other services as may be required in order to perform its public functions, including, but not limited to, accounting, treasury, management, procurement, personnel services, engineering services, and planning services, and other consultant services, provided however, that nothing herein shall be construed as prohibiting the URA from contracting with third parties to provide all or a portion of such services. It is the intention of the parties that the URA’s annual or any special financial audits shall be performed by an independent auditor. All costs of any such audit or financial services shall be paid by the City, subject to reimbursement by the URA as provided in Section 5 below. 4. Office Space; Furnishings; Equipment City staff working on behalf of the URA is authorized to utilize City office space, furnishings and equipment, including telephones, fax machines, printers, photocopiers, computers, office supplies and similar equipment, to carry out URA business. A prorated share of the expenses associated with use of such office space, furnishings and equipment shall be charged back to the URA in accordance with Section 5 below. As needed, the City may make available office space to the URA, as provided under any such lease agreements as may be agreed upon by the City and the URA. 5. City Compensation At such time as the City Council determines that the URA has sufficient funding source(s), the URA shall compensate the City for all or a portion of the costs reasonably incurred by the City in providing City Staff, services, office space, furnishings and equipment described herein. The City shall submit to the URA, at such times in the future as the City deems appropriate, one or more invoices detailing the specific services rendered and other expenses incurred by the City on behalf of the URA a specific time period stated in such invoice(s). Such invoices shall be in sufficient detail and shall include salaries, benefits, insurance and other costs incurred by the City, on a prorated basis, and shall sufficiently designate the type of service performed by the City so that the URA may properly determine the accuracy of the invoices. Unless the URA objects to an invoice within ten (10) days of the date of the invoice, the URA shall be deemed to approve such invoice for payment to the City and shall make payment to the City within a reasonable time and as funding of the URA is available. 6. City Advance of Funds If requested by the URA, the City may, from time to time, advance funds to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission. 7. Legal Entity, Ethical Rules, Bylaws The URA constitutes a separate body corporate and politic as established under the statutes of the State of Colorado, and the URA Commission shall expeditiously adopt a set of Bylaws for the purpose of governing the officers and staff, meetings, ethical rules, and powers of the URA Commission. The ethical rules of the URA Commission shall be the same as those 4 which are applicable to the City Council, as long as the City Council is functioning as the URA Board of Commissioners. The URA shall comply with then current City policies regarding purchasing and expenditure of funds. 8. Sales Tax Increment It is agreed between the City and the URA that all City sales taxes collected in any urban renewal area of the URA shall accrue to the City until such time, if at all, that the City Council, in its sole discretion, decides to include in an urban renewal plan a provision allocating a portion of said sales tax revenues to the Authority for the purpose of funding URA projects within a particular urban renewal area. 9. Property Tax Increment The City agrees to assist the URA in pursuing its objectives and purposes, including, without limitation, any specific purposes established for a particular urban renewal area, by collecting and paying into a special fund of the URA the Incremental Property Taxes received by the City for each urban renewal area, for the purpose of paying the principal of, the interest on and any premiums due in connection with the bonds of, loans or advances to or other indebtedness incurred by the URA for financing or refinancing urban renewal projects within such area. In the event that the City is unable to collect through lawful means any Property Tax Revenues due for any urban renewal area, the amount of uncollectible Property Tax Revenues shall be allocated between the URA and the City for the urban renewal area in the same proportion as the total collected Property Tax Revenues within such area are allocated between the City and the URA for such Fiscal Year. The Property Tax Increment shall be calculated in accordance with Colorado law, the applicable urban renewal plan, and this Intergovernmental Agreement. 10. Insurance The URA may provide its own public liability insurance and other insurance provided, however, that the City and the URA agree to consider the desirability of including the URA within the City’s existing liability insurance coverages as a part of the services to be provided by the City to the URA subject to reimbursement of any additional cost to the City as provided in Section 5 above. 11. Responsibility of URA Nothing in this Agreement shall be interpreted in any manner as constituting the City as the agent of the URA or the URA as the Agent of the City. Each party shall remain separate and neither shall hereby assume the debts or obligations of the other. The URA shall be solely responsible for carrying out its duties and functions in accordance with the Colorado Urban Renewal Law and other applicable laws and regulations. 12. Termination This Agreement may be terminated by the mutual consent of the parties at any time after giving at least thirty (30) days written notice of intention to terminate the Agreement. 5 13. Binding Agreements This Agreement represents the total binding Agreement between the parties and replaces and supercedes any prior oral or written agreement between the City and the URA. 14. Governing Law This Agreement shall be governed by, and construed in accordance with the laws of the State of Colorado. 15. Severability If any covenant, term, condition, or provision under this Agreement shall, for any reason, be held to be invalid or unenforceable, the invalidity or unenforceability of such covenant, term, condition, or provision shall not affect any other provision contained herein, the intention being that such provisions are severable. 16. No Third Party Beneficiaries Nothing expressed or implied in this Agreement is intended or shall be construed to confer upon, or to give to, any person other than the City and the URA any right, remedy, or claim under or by reason of this Agreement or any covenants, terms, conditions, or provisions thereof, and all the covenants, terms, conditions, and provisions in this Agreement by and on behalf of the Parties shall be for the sole and exclusive benefit of the Parties. 17. No Waiver of Governmental Immunity Nothing in this Agreement shall be construed to waive, limit, or otherwise modify any governmental immunity that may be available by law to the City or to the URA, their officials, employees, contractors, or agents, or any other person acting on behalf of the City or the URA and, in particular, governmental immunity afforded or available pursuant to the Colorado Governmental Immunity Act, Title 24, Article 10, Part 1 of the Colorado Revised Statutes. CITY OF FORT COLLINS, COLORADO By: Douglas P. Hutchinson, Mayor ATTEST: APPROVED AS TO FORM: By: By: Wanda Krajiceck, City Clerk City Attorney 6 FORT COLLINS URBAN RENEWAL AUTHORITY By ______________________________ Douglas P. Hutchinson, Chairperson ATTEST: APPROVED AS TO FORM: By: By: URA Secretary URA Attorney RESOLUTION NO. 2011-055 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE MAYOR TO EXECUTE AN AMENDMENT TO THE INTERGOVERNMENTAL AGREEMENT WITH THE FORT COLLINS URBAN RENEWAL AUTHORITY WHEREAS, on February 21, 2006, the Board of Commissioners of the Fort Collins Urban Renewal Authority (the “Board”) adopted a resolution establishing an ad hoc committee for the purpose of formulating recommendations regarding the administration of the Urban Renewal Authority (the “URA”); and WHEREAS, one of the recommendations of the ad hoc committee and City staff was that a general "umbrella" intergovernmental agreement be entered into between the City and the URA governing a number of topics; and WHEREAS, on August 15, 2006, the City Council adopted Resolution 2006-082 authorizing the mayor to enter such an intergovernmental agreement with the URA (the “IGA”); and WHEREAS, Section 6 of the IGA states that the City may advance funds to the URA in support of its activities so long as the advance of funds is evidenced in writing through a promissory note or a grant; and WHEREAS, the City Council believes that the language of the IGA should be amended to clarify that any and all advances of funds the City makes to the URA should be evidenced by a promissory note and related loan agreement, regardless of the circumstances under which such advances are made; and WHEREAS, staff has prepared a proposed amendment to the IGA (the “Amendment”) a copy of which is attached hereto as Exhibit “A” and incorporated herein by this reference; and WHEREAS, the City Council has determined that the Amendment is in the best interests of the URA and should be entered into between the City and the URA. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the Mayor is hereby authorized to execute the amendment to the intergovernmental agreement between the City and the URA. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 5th day of July, A.D. 2011. Mayor ATTEST: City Clerk FIRST ADDENDUM TO THE INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND THE FORT COLLINS URBAN RENEWAL AUTHORITY REGARDING OPERATING STAFF AND RESOURCES THIS ADDENDUM is made and entered into by and between THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (the “City”), and THE FORT COLLINS URBAN RENEWAL AUTHORITY, a political subdivision of the State of Colorado (the “URA”), and shall be effective on the date signed by the City. WHEREAS, the City and URA have previously entered into that certain Intergovernmental Agreement dated August 15, 2006 (the “Agreement”); and WHEREAS, the City and the URA desire to continue their arrangement of sharing operating staff and resources to maintain economy and efficiency of operations; and WHEREAS, the City and the URA wish to amend the Agreement to clarify the advancement of funds under the Agreement; and WHEREAS, the parties are authorized to enter into intergovernmental agreements to provide any function, service or facility as provided in Article II, Section 16 of the Charter of the City of Fort Collins and Section 29‐1‐203, C.R.S. NOW, THEREFORE, in consideration of mutual promises and covenants and other good and valuable consideration, the receipt and adequacy of which are acknowledged, the parties agree to amend the terms and conditions of the Agreement as follows: 1. That Section 6 of the Agreement is modified to read: The City may, in the sole discretion of the City Council, advance funds to the URA in support of the URA’s activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission. 2. All other terms and conditions of the Agreement shall remain unchanged and in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this First Addendum to the Intergovernmental Agreement between the City of Fort Collins, Colorado and the Fort Collins Urban Renewal Authority Regarding Operating Staff and Resources to be executed. For the City: THE CITY OF FORT COLLINS A Municipal Corporation By: ____________________________________ Karen Weitkunat, Mayor ATTEST: Approved as to legal form: _____________________________ City Clerk ________________________ Assistant City Attorney For the URA: THE FORT COLLINS URBAN RENEWAL AUTHORITY A political subdivision of the State of Colorado By: ____________________________________ Karen Weitkunat, Chairperson ATTEST: Approved as to legal form: _____________________________ Secretary ________________________ Authority Attorney DATE: July 5, 2011 STAFF: Wanda Krajicek AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 22 SUBJECT Resolution 2011-056 Making an Appointment to the Citizen Review Board. EXECUTIVE SUMMARY A vacancy currently exists on the Citizen Review Board due to the resignation of Evan Singleton. Councilmembers Gerry Horak and Ben Manvel and City Manager Darin Atteberry reviewed the applications on file. The interview team is recommending Robert Springer to fill the vacancy with a term to begin immediately and set to expire on December 31, 2013. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. RESOLUTION 2011-056 OF THE COUNCIL OF THE CITY OF FORT COLLINS MAKING AN APPOINTMENT TO THE CITIZEN REVIEW BOARD WHEREAS, a vacancy currently exists on the Citizen Review Board due to the resignation of Evan Singleton; and WHEREAS, the City Council desires to make an appointment to fill the vacancy. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the following named person is hereby appointed to fill the current vacancy on the Citizen Review Board, with a term to begin immediately and to expire as set forth after the name: Citizen Review Board Expiration of Term Robert Springer December 31, 2013 Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 5th day of July A.D. 2011. Mayor ATTEST: City Clerk DATE: July 5, 2011 STAFF: Karen Cumbo AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 26 SUBJECT Second Reading of Ordinance No. 071, 2011, Approving the Waiver of City Fees for the CARE Housing Affordable Housing Project in the Provincetowne Subdivision. EXECUTIVE SUMMARY Under Colorado statute and City of Fort Collins ordinances and resolutions dating back to 1988, the projects of housing authorities are exempt from taxes and fees. For many years, the City has waived building permit and development review fees and some capital expansion fees for projects of the Fort Collins Housing Authority (FCHA), as required by the ordinance. For the most part, these have been relatively small projects. FCHA is currently partnering with the non-profit CARE Housing in a large, multi-family affordable housing project in the Provincetowne subdivision, which is under construction. Fee waivers for this project total $557,378 (outlined in detail in “Financial Impacts” below). This Ordinance was adopted on First Reading on June 7, 2011, by a vote of 6-1 (nays: Ohlson). Based upon Council’s comments and questions during First Reading of this ordinance, staff has added more context, chronology, and explanation regarding affordable housing finance and the request for fee waivers for the Provincetowne, Filing III development. While the City has long been committed to affordable housing, and the need for financial support is clearly demonstrated in the increase in the number of applications for local and federal funds, the fiscal impact of this and future fee waivers for projects in which the FCHA is a partner rather than sole owner warrants some thoughtful evaluation of the waiver situation, and possibly some changes to the City Code. Additionally, considering the current and projected fiscal impact on the City for fee waivers for large projects, clarification for the definition of “ownership” as it pertains to the Housing Authority and its development partners will be part of the review. This policy issue will be addressed at an upcoming work session. Pending that policy discussion, the City Manager is recommending that Council consider waiving the fees due for the CARE Housing project. BACKGROUND / DISCUSSION CARE Housing (a non-profit) bought a portion of the Provincetowne project site, located at Autumn Ridge Road and Trilby, from KB Homes to fulfill the affordable housing requirement for the entire residential project. This is an 85-unit, $14.9 million townhome rental housing project intended to serve families earning 30%-50% of the Area Median Income (AMI). [Current Fort Collins/Loveland AMI for a family of four is $76,700. An annual income of $23,000 = 30% AMI, and $38,350 is 50% AMI]. Funding for the project is a combination of grants, Low Income Housing Tax Credits, owner equity, and conventional financing. Provincetowne Funding Sources Amount Low Income Housing Tax Credit Equity $8,724,906 Tax Credit Assistance Program (American Reinvestment and Recovery Act) $1,609,480 HUD Entitlement Funds – CDBG/HOME $1,455,011 City of Fort Collins – Affordable Housing Fund $100,000 Colorado Division of Housing $500,000 Federal Home Loan Bank of Topeka $350,000 Permanent Loan Financing $2,060,000 Deferred Developer Fee $155,855 Development Total $14,955,252 The financing of affordable housing is complex, especially in today’s economic climate. A fifteen year federal tax credit for private investors is a critical component of the financial package, and the private investor (J.P. Morgan Chase, in July 5, 2011 -2- ITEM 26 this case) must be a 99% owner. The Housing Authority is technically only a .001% participant in this project, but is further involved because it guarantees up to $1.4 million of unanticipated costs. Both the tax credit and the fee waiver are critical components of the Provincetowne project, and elimination of either could jeopardize the project. Historically, the City has waived its fees for other, smaller projects in which the FCHA was a minority partner. However, the magnitude of the fees associated with this project has prompted extensive conversations about the ownership issue and the financial impact that the waiver of fees for the project would have on the City. These conversations began during the building permit application process for Provincetowne. Early on, the assumption was that there should be no distinction between a project that is wholly owned or developed by FCHA, and one in which FCHA has only a fractional participation. However, the magnitude of this proposed fee waiver prompted a re- examination of the City’s legal obligation to waive fees for this kind of project. As the legal requirements of state and local law on this subject were further explored, it became apparent that there are two ways to interpret the law on fee waivers for housing authority projects. The difference of opinion as to the proper interpretation of the law led to a new series of negotiations with all of the parties, including consideration of deferral of the fees for some period of time. But because a compromise could not be reached in the negotiations, the decision was made to seek policy direction from City Council. The series of events was essentially as follows. Project Timeline November 2006 CARE Housing purchased the land January 2007 CARE submitted first tax credit application, which was not strong to receive a tax credit award April 2008 CARE began discussions with FCHA about partnership July 2008 FCHA Board of Commissioners approved formal participation intent by resolution August 2008 CARE Housing application for CDBG funds submitted. Fee waivers discussed during pre- application meeting September 2008 CARE Housing and FCHA present application for funding to CDBG Commission. Financing package assumed City waiver of fees January 2009 CARE submitted second tax credit application which included the strength of FCHA as a partner and did include fee waivers April 2009 CARE submitted third tax credit application with additional committed grants and FCHA participation June 2009 Low Income Housing Tax Credit (LIHTC) Reservation awarded by Colorado Housing and Finance Authority (CHFA) November 2010 First building permits requested from the City of Fort Collins. Discussions begin about the proper documentation to show FCHA’s ownership interest and the applicability of the FCHA fee waivers Construction begins. January 2011 FCHA learns of City concerns about the fee waivers. Building permits note deferral of fees pending resolution. February 2011 FCHA corresponds with the City about FCHA ownership, Ordinance No. 065, 1999 and Colorado Revised Statutes and continues to believe, based upon the City’s response, that fee waivers would extend to Provincetown partnership. PDT management and City Manager’s office notified about situation. Interdepartmental staff team (including City Attorney’s and City Manager’s office) undertakes research and development of options. March-May 2011 Negotiations continue, involving City, FCHA, CARE Housing, and legal representatives July 5, 2011 -3- ITEM 26 A significant component of the financing picture for this project is the expectation by FCHA partners and their lenders that the fee exemption which the Fort Collins Housing Authority is eligible for under state law and the City Code passes to the other funding partners. This includes a waiver of taxes and development review and capital expansion fees as provided in Sec. 7.5-17(1) of the Fort Collins Municipal Code. The degree of the FCHA’s ownership of the project has been the subject of considerable discussion, but because of the statutory and municipal code provisions, as well as historic precedent, FCHA and CARE assumed that the waivers would apply in this project. The City has routinely waived fees for FCHA projects in the past. Most of those waivers dealt with small building permit projects, but the waivers also applied to the construction of the Via Lopez project in 1998 and 1999. The FCHA was developer of the low-income homeownership project, which included 22 single family detached homes sold to first- time homebuyers. These fee waivers totaled approximately $107,476. In addition, two acquisition-rehabilitation projects were recently completed by FCHA utilizing LIHTC financing: Village on Elizabeth in 2008, and Village on Stanford in 2010. Both projects received total fee waivers of approximately $4,000. In both cases, FCHA’s subsidiaries are a .01% partner and the equity investors have 99.9% interest in the partnership for the tax credit period of 15 years. At the end of that period, FCHA will be 100% owner. In 1995 and 1996, a 24-unit development on Impala Circle and a 44-unit development at 1403 West Swallow, of which the FCHA was a minimal owner, were built with total estimated fee waivers of $164,808. Several local projects, either partially or wholly composed of affordable units, have sought support from the FCHA. Not all such requests have been approved by the FCHA Board. The FCHA considers a number of criteria in reviewing such requests: financial feasibility, benefit to low-income households, access to support services and other criteria, before agreeing to participate. The funding of affordable housing projects requires strategic packaging of a variety of borrowed resources, application for local and federal funds, and, in most cases, the IRS Low Income Housing Tax Credit program. The LIHTC program requires that equity investors have a 99.9% ownership. It is really the only tool for affordable housing development for the community’s lowest income families. Without it, market rents would be necessary to make the financing work and likely would no longer be considered as an affordable housing project. Affordable Housing Projects and Fees Development and building permit fees for affordable housing projects are currently handled in two ways: 1. If the Housing Authority is involved, all fees and taxes, except for utility fees, are waived as described above, pursuant to both State law and City Code. 2. For affordable housing projects that do not involve the Housing Authority, the following occurs: a. By City Code, development review fees are waived according to the percentage of the project that meets the criteria for and has been designated as affordable. If a project receives a 100% affordable housing designation, 100% of the development review fees are waived; if 10% of the housing units are designated affordable, 10% of the fees are waived. b. By state and federal statutes, sales tax fees are waived for any tax-exempt entities. c. By City Code, plan check, building permit and certain utility fees are collected at the time of building permit issuance. d. By City Code, all other fees are delayed until Certificate of Occupancy issuance, or December 1st of the year the building permit was issued, whichever first occurs. Development review fees cover services rendered. If the fees are waived, and the services are still provided, then the General Fund presumably backfills the gap of expenses incurred. Likewise, Capital Expansion Fees (parkland, fire, street oversizing, police, etc.) cover capital costs associated with new development. If the fees are waived and the capital improvements still provided, then other City, PFA and School District funds presumably backfill the gap. Utility connection fees are not waived. Over $1.5 million of City administered competitive funds, including CDBG and HOME, have already been expended on the Provincetowne project, including payment of water tap fees, electric capacity fees, PFA fees, and building permit July 5, 2011 -4- ITEM 26 fees. Building permits have been issued for all eleven buildings and construction is underway, with the first units expected to be occupied by the end of June 2011. Because of concerns about significant financial and policy impacts on the City, management staff and the City Attorney’s Office have explored several facets of this issue. Staff also worked with the FCHA and CARE Housing on some proposed alternatives to a full waiver of fees for projects involving FCHA partnership. Alternatives discussed include deferring those fees rather than waiving them or limiting the waiver to situations where the FCHA is the majority owner of the project. As noted above, each of these alternatives proved to be unacceptable to one or more of the parties involved. As a result, the City Manager is recommending that the Council waive the fees for the CARE Housing project and then address possible changes in the policy of continuing to waive fees for these kinds of projects at a later time. The most significant issue for Council consideration is the determination of eligibility for fee waivers under current law. If Council determines that the Provincetowne project is not eligible for a fee waiver because of the minority ownership position of the FCHA, and requires payment of the fees, that decision could create a potential default situation. One possible remedy would be that FCHA would step in, thereby creating full ownership, in a sense, and triggering a complex set of legal and financial actions. A more likely scenario would be that FCHA and/or CARE would assemble the funds to pay the fees. To date, the project is on budget and ahead of schedule. The risk related to low income housing tax credit (LIHTC) leasing requirements remains but is minimal. The only real risk at this point would be the additional cost of over $500,000 in fees not waived. CARE Housing has the ability to refinance a property it currently owns and could take out $509,896 in equity. CARE had planned to refinance a property and take out this equity in order to make planned capital improvements which would be deferred indefinitely if this money needs to go into Provincetowne. Attachment 4 is a memo from Julie Brewen, FCHA Director, that gives FCHA’s perspective on the proposed fee waiver, as well as an explanation of how the FCHA determines, on a case-by-case basis, whether to enter into these kinds of partnerships. Other Pending Affordable Housing Projects The Legacy Senior Residences is expected to be under construction this fall, but this project will not be requesting a waiver of fees. The cost of the fees has been built into the financing. Other projects are in the early planning stages, but construction is not anticipated until at least 2013. Other Communities Fort Collins is not the only community faced with this situation. Staff research shows that despite the state law, the waiver of fees is not consistently applied. Some cities waive fees as a matter of policy, and some waive on a case by case basis. Some do not waive fees. A summary of the research is included as Attachment 5. Future Policy and Legal Issues Several questions will be presented to Council at an upcoming work session, and may ultimately result in changes to the City’s policies and ordinances regarding fee waivers. • Does (or should) the waiver of fees for the Housing Authority properly extend to majority partners, or should it be limited to projects wholly owned, developed and operated by the Fort Collins Housing Authority, or projects with some specified ownership interest? • Under what conditions should the City waive fees? • If fees are waived, how are the financial impacts addressed? July 5, 2011 -5- ITEM 26 FINANCIAL / ECONOMIC IMPACTS For the Provincetowne project (eleven multifamily buildings; a total of 85 low income rental units), the potential financial impact of a fee waiver to City funds is $557,378. Approximately $4,762 of the fee revenue lost is Utility development review fees. Building permit and plan check fees total $42,720. The remaining $509,896 is comprised of Capital Expansion fees (Fire, Police, General Government, Parkland, Street Oversizing, and School fees). These figures reflect recent changes in the capital expansion and utility development review fees. Some fees were collected at the inception of this project because of the unresolved issues, and approximately $17,177 will need to be refunded if the fees are waived. The following is a breakdown of the $509,896 Capital Expansion Fees for the Provincetowne/CARE housing townhome buildings. Fire: $ 13,523 Police: $ 9,233 General Government: $ 16,920 Larimer County Roads: $ 15,725 Community Parkland: $118,830 Neighborhood Parkland: $106,590 City Street Oversizing: $148,665 School: $ 80,410 TOTAL CAPITAL EXPANSION FEES WAIVED: $509,896 STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. BOARD / COMMISSION RECOMMENDATION The Affordable Housing Board considered this matter at a meeting on June 16, and unanimously approved a motion to support Ordinance No. 071, 2011, to waive the fees for the Provincetowne project. The Board is sympathetic to Council’s concerns about the financial impacts, but because this project was planned and financed with reasonable expectation of the fee waivers, the Board feels it should be completed as proposed. The Board would like to be included in future discussions of the fee waiver issue. It noted that Policy AHSP-15 in the City’s Affordable Housing Strategic Plan 2010-2014 called for the development of a permanent source of revenue for affordable housing, which could be a source of funds for the fee waiver. Draft meeting minutes can be found in Attachment 6. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - June 7, 2011 (w/o attachments) 2. Location map for Provincetowne Townhomes 3. Ordinance No. 065, 1999 4. FCHA Director Brewen’s memo 5. Information about other communities 6. Affordable Housing Board minutes , June 16, 2011 7. Powerpoint presentation COPY COPY COPY COPY ATTACHMENT 1 DATE: June 7, 2011 STAFF: Karen Cumbo AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 20 SUBJECT First Reading of Ordinance No. 071, 2011, Approving the Waiver of City Fees for the Care Housing Affordable Housing Project in the Provincetowne Subdivision. EXECUTIVE SUMMARY Under Colorado statute and City of Fort Collins ordinance, the projects of housing authorities are exempt from taxes and fees. For many years, the City has waived fees for projects of the Fort Collins Housing Authority (FCHA), as required by the ordinance. For the most part, these have been relatively small projects. FCHA is currently partnering with the non-profit CARE Housing in a large, multi-family affordable housing project in the Provincetowne subdivision, which is under construction. Fee waivers for this project total $557,378. While the City has long been committed to affordable housing, and the need for financial support is clearly demonstrated in the increase in the number of applications for local and federal funds, the fiscal impact of this and future fee waivers for projects in which the FCHA is a partner rather than sole owner may warrant some thoughtful evaluation of the waiver situation, and possibly some changes to the City’s Code. In addition to considering the current and projected fiscal impact on the City for fee waivers for large projects, clarification is also being sought from City Council on the definition of “ownership” as it pertains to the Housing Authority and its development partners. This issue will be addressed at a future work session. Pending that policy discussion, the City Manager is recommending that Council consider waiving the fees due for the CARE Housing project. BACKGROUND / DISCUSSION CARE Housing (a non-profit) bought a portion of the Provincetowne project site, located at Autumn Ridge Road and Trilby, from KB Homes to fulfill the affordable housing requirement for the entire residential project. The financing of affordable housing is rather complex, especially in today’s economic climate. A fifteen year federal tax credit for private investors is a critical component of the financial package, and the private investor (J.P. Morgan Chase, in this case) must be a 99% owner. The Housing Authority is technically only a .001% participant in this project, but is further involved because it guarantees up to $1.4 million of unanticipated costs. The affordability period for the Project is 40 years. Under certain circumstances, the Housing Authority could take over the project. State law contemplates the type of tax credit financing structure that is being used to finance this Project (where the Housing Authority has only a partial ownership interest), by stating that a project is exempt from taxation if it is owned by “an entity in which an entity wholly owned by an authority has an ownership interest.” It is not clear, however, whether the statutory intent is to also exempt such a project from fees. That is because, as to the exemption from both taxes and fees, the statute states that just “the authority” is exempt. Another component of the financing picture for this project is the expectation by FCHA partners and its lenders that the fee exemption for which the Fort Collins Housing Authority is eligible under state law and the City Code passes to the other funding partners. This includes a waiver of taxes and development review and capital expansion fees as provided in Sec. 7.5-17(1) of the Fort Collins City Code. The degree of the FCHA’s ownership of the project has been the subject of considerable discussion. Does (or should) the waiver of fees for the Housing Authority properly extend to majority partners, or should it be limited to projects wholly owned, developed and operated by the Fort Collins Housing Authority, or projects with some specified ownership interest? A related concern in the extension of the fee waivers to FCHA partners is the criteria for approving projects and partners. Several local projects, either partially or wholly composed of affordable units, have sought support from the FCHA, and not all such requests have been approved by the FCHA board. The FCHA considers financial feasibility, benefit to low-income households, access to support services and other criteria, before agreeing to participate. COPY COPY COPY COPY June 7, 2011 -2- ITEM 20 Affordable Housing Projects and Fees Development and building permit fees for affordable housing projects are currently handled in two ways: 1. If the Housing Authority is involved, all fees and taxes, except for utility fees, are waived as described above, pursuant to both State law and City Code. 2. For affordable housing projects that do not involve the Housing Authority, the following occurs: a. By City Code, development review fees are waived according to the percentage of the project that meets the criteria for and has been designated as affordable. If a project receives a 100% affordable housing designation, 100% of the development review fees are waived; if 10% of the housing units are designated affordable, 10% of the fees are waived. b. Sales taxes are waived for any tax-exempt entities. c. By City Code, plan check, building permit and certain utility fees are collected at the time of building permit issuance. d. By City Code, all other fees are delayed until Certificate of Occupancy issuance, or December 1st of the year the building permit was issued, whichever first occurs. Development review fees cover services rendered; if the fees are waived, and the services are still provided, then the General Fund presumably backfills the gap of expenses incurred. Likewise, impact fees (parkland, fire, street oversizing, police, etc.) cover capital costs associated with new development. If the fees are waived and the capital improvements still provided, then City, Poudre Fire Authority (PFA) and School District funds presumably backfill the gap. Utility connection fees are not waived. The City has routinely waived fees for FCHA projects in the past. Most of those waivers dealt with relatively small projects. The last significant new FCHA construction project was the Via Lopez project in 1998 and 1999. The FCHA was 100% owner of the development, which included 22 single family detached homes; fee waivers totaled approximately $107,476. Over $1.5 million of City administered competitive funds, including CDBG and HOME, have already been expended on the Provincetowne project, including payment of water tap fees, electric capacity fees, PFA fees, and building permit fees. Building permits have been issued for all eleven buildings and construction is underway, with the first units expected to be ready for occupancy by June 11. Because of concerns about significant financial and policy impacts on the City, management staff and the City Attorney’s Office have explored several facets of this issue. Staff also worked with the FCHA and CARE Housing on some proposed alternatives to a full waiver of fees for projects involving FCHA partnerships, including deferring those fees rather than waiving them or limiting the waiver to situations where the FCHA is the majority owner of the project. However, each of the alternatives examined was problematic in this situation, primarily because the projections for the Project were developed, and financing structured, based on the assumption that the fees would be waived as they have been for previous FCHA projects. The City Manager is recommending that the Council waive the fees for the CARE Housing project and then deal with the policy question of continuing to waive fees for these kinds of projects at a later time. That question will be presented to Council at a work session on July 5. Attached is a memo from Julie Brewen, FCHA Director (Attachment 3), that gives FCHA’s perspective on the proposed fee waiver, as well as an explanation of how the FCHA determines, on a case-by-case basis, whether to enter into these kinds of partnerships. FINANCIAL / ECONOMIC IMPACTS For the Provincetowne project (eleven multifamily buildings; a total of 85 low income rental units), the potential financial impact of a fee waiver on City funds is $557,378. COPY COPY COPY COPY June 7, 2011 -3- ITEM 20 Approximately $4,762 of the fee revenue lost is Utility development review fees. Building permit and plan check fees lost total $42,720. The remaining $509,896 is comprised of Capital Expansion fees (Fire, Police, General Government, Parkland, Street Oversizing, and School fees). These figures reflect recent changes in the capital expansion and utility development review fees. Some fees were collected at the inception of this project because of the unresolved issues, and approximately $17,177 will need to be refunded if the fees are waived. ENVIRONMENTAL IMPACTS Staff has identified no adverse environmental impacts as a result of granting this fee waiver. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION These issues will be addressed with the Affordable Housing Board on June 16 so that its input can be considered by Council at the work session on the policy issues on July 5. ATTACHMENTS 1. Location map for Provincetowne Townhomes 2. Ordinance No. 065, 1999 3. FCHA Director Brewen’s memo 4. Powerpoint presentation Attachment 2 NN E. Trilby Rd. S. College Ave. Lemay Rd. Carpenter Rd. ATTACHMENT 3 To: Karen Cumbo, PDT Director From: Julie Brewen, Executive Director Date: May 24, 2011 Re: FCHA Development Partnership Criteria and the Provincetowne Development In 2004, the FCHA Board of Commissioners established formal criteria for considering private developer requests for FCHA participation. FCHA staff and the Board of Commissioners have been extremely sensitive to our relationship with the City of Fort Collins and our responsibilities related to public/private partnerships. In 2006, FCHA and CARE Housing began discussions regarding how FCHA could strengthen the Provincetowne development for low-income families in our community. The discussions were based on FCHA’s Partnership Criteria and the following statutes, ordinance and precedent.  Ordinance No. 65, 1999. City Ordinance specifically exempts all housing authority projects from the payment of enumerated fees based on an explicitly stated important public purpose. City Ordinance also references the consistent statutory exemption found at CRS 29- 4-226.  CRS 29-4-227. Statute provides that the Provincetowne project, in which the FCHA has an ownership interest, is exempt from the payment of taxes or fees to the state or any subdivision thereof. It is our position that a plain reading of this statute exempts the Provincetowne project in which FCHA has an ownership interest. It is also our position that the legislative history of this statutory provision supports full exemption based on conversations with an author of this statute.  CRS 29-20-104.5. Statute specifically authorizes a local government to waive an impact fee or development charge on the development of low or moderate income housing as defined by the local government. City Ordinance No. 65 waives the fee. The City has waived fees for FCHA projects recently and consistently over the past 40 years. The requested fee waiver is supported directly by both Ordinance and statute.  City Practice. The City has waived fees for FCHA projects. It is on this basis that FCHA and CARE structured ownership of the Provincetowne project based on reasonable reliance of City practice. FCHA Partnership Criteria:  Whether a proposed project includes households that earn 30-50% of Area Median Income (AMI) on rental projects, or 80% and below AMI for homeownership projects.  How FCHA resources will increase benefit to low-income households, through increased number of affordable units, lower housing costs, or both, and/or access to support services. ATTACHMENT 4  Market information as determined by FCHA which shows demand for the proposed project.  Long-term affordability, with a preference for projects that achieve permanent affordability.  Opportunity for ownership by the FCHA, and/or FCHA buy-out options after 20-30 year affordability period.  Does the proposal demonstrate development capacity, experience and commitment to the targeted population?  To what extent will FCHA share in the developer fee?  What is the project proximity to employment, transportation, schools, retail, and recreation?  Role of FCHA in the long-term management of the project, including the opportunity to earn a reasonable management fee.  Degree and nature of risk for FCHA.  Degree to which FCHA’s ownership interest is commensurate with the financial benefits it brings to the project.  Projects in which all or a portion of the units are designed to serve special needs population such as the elderly or persons with disabilities may receive special consideration. In addition, we consider whether our involvement strengthens both entities and ultimately makes the project stronger. Each year, FCHA reviews several formal and informal requests for participation in development projects. In 2010/2011, two formal requests were thoroughly vetted and subsequently denied. To date, Provincetowne is the first new construction development partnership that has been formally executed and warranted this level of FCHA participation. Not only does it rank high on our criteria, several factors related to the current economy and the soft market for investor purchase of Low Income Housing Tax Credits have necessitated our increased level of participation and loan guarantees. We are currently working with a developer partner on one other project at this time. We will be the co-developer of Legacy senior apartments which will provide housing for 72 low-income seniors. Again, this project is extremely strong in terms of our criteria above. This particular developer partner has had a great of success with low-income housing tax credit properties in partnership with other housing authorities across our region. In this particular deal, our co- developer partner is taking the majority of the risk, while FCHA and our community will reap all of the benefit. It is likely that due to the current tax credit equity market, this deal will support the voluntary payment of some or all of the development fees. FCHA will become the full owner after the initial 15 year Low Income Housing Tax Credit program investor period. In this case, two strong entities with the same mission and vision will ultimately create an outstanding product and service for our community. There are at least two FCHA projects currently in the due diligence or conceptual phase. One project is a multi-family new construction project that may or may not replace existing public housing. Another project on the drawing board is a “Housing First” apartment property serving single people who have been homeless or near-homeless. Both of these projects will be developed solely by FCHA. At this time, we do not know if either of these project development budgets and financing structures will support the voluntary payment of the development fees, however FCHA will be happy to voluntarily pay some or all of the fees when such projects support doing so. ATTACHMENT 5. Affordable Housing Fee Waiver - Sample Comparison of Other Colorado Jurisdictions City / County Housing Authority Sponsored Projects Other Affordable Housing Projects City & County Broomfield Fees are waived on all remodels. For new construction, the fees are waived on a case by case basis. Longs Peak Energy, Habitat for Humanity, and some others automatically receive waiver of fees per City Council direction. No fees are waived or deferred. Greeley No fees are waived or deferred. (They have not constructed any affordable housing in over 10 years) Offset with HOME fund federal grants for programs like Habitat for Humanity. Fees are not waived or deferred. Larimer County Do not have many of these projects so they would be addressed at the time they were considered. No fees are waived or deferred. Loveland Case by case basis. Developer applicants go before Affordable Housing Commission for a recommendation, and then before City Council and request waivers and/or reductions. City Council has set aside six lots for Habitat for Humanity to build on; all fees are waived. There is a limit to the amount of fees they will backfill. Other non-profits must request fee waivers from City Council; the requests are usually granted. Housing development - builder applies for affordable housing and then fees are waived on houses that are designated as affordable (all fees are waived for these). Council may choose to reduce fees instead of full waiver. Comes before their Affordable Housing Commission first for a recommendation. Then goes to City Council. Working on new revisions to their housing code to add provisions for delayed fee payments in cases where developers get behind on building the percentage of affordable units promised as part of their development. When the developer get behind, the City will start charging them full fees for additional permits until they catch up with the appropriate percentage of affordable units. Once they are back on track, the City will start waiving fees again. This will allow some fee deferments in times when developers are behind in their affordable housing perce Thorton Thornton hasn't dealt with this issue yet, but would recognize the state statute. Requests would be handled on a case by case basis. No fees are waived or deferred unless directed by management. Request are handled on a case by case basis. Westminster Housing Authority treated like any other developer. City is more readily willing to waive these fees on projects sponsored by the Housing Authority. City works with Westminster Housing Authority, Jefferson County and Adams County. No recent big projects with them. Westminster does not have a blanket policy waiving any fees or taxes. Case by case basis - based on financial necessity of waiver. Other factors are considered such as location of project, relationship to the comprehensive use plan, etc. Westminster gives consideration to waiving development and building fees, use tax. The only thing they do not waive is water tap fees (a separate enterprise). City has an open space sales tax that they cannot waive since tied to bonds. Otherwise, all others, including CIEs are subject to negotiation. There is a Development Review Committee made up of staff from the City Manager's Office & Community Development who look at cases and make determination. their recommendation then goes to City Council since they have no authority to waive fees. Waivers are done by ordinance. Lakewood Do waive fees, but do not backfill. They sometimes offset water and sewer fees and repay them with the affordable housing fund. Pueblo Generally do not waive fees. The city manager can waive them, but normally doesn't. Adams County City & County Denver Longmont Longmont waives fees, but does not backfill. Jefferson County County does not waive fees Boulder (City) They used to waive fees but do not any longer. They don't charge an inclusion fee for permanent housing though. County does waive fees, but does not backfill because the fees are nominal. They do waive fees; do not backfill. ATTACHMENT 6 SPECIAL MEETING CITY OF FORT COLLINS AFFORDABLE HOUSING BOARD DRAFT MEETING MINUTES 281 N. College Ave. Conference Rooms A Fort Collins, Colorado June 16, 2011 4:00 – 6:00 PM Chair: Ben Blonder Staff Liaison: Ken Waido, 970-221-6753 City Council Liaison: Lisa Poppaw Board Members Present: Dan Byers, Wayne Thompson, Marie Edwards, Mike Sollenberger, Wendie Robinson Board Members Absent: Ben Blonder Advance Planning Department Staff Present: Ken Waido Council Members Present: None Other Staff Present: Karen Cumbo, Director of Planning, Development, and Transportation; Gail Neben, Note Taker Guests: Julie Brewer, Executive Director, Fort Collins Housing Authority Meeting called order by Dan Byers, Vice Chair, at 4:00 PM. Provincetowne - Potential Waiver of City Impact Fees for the Fort Collins Housing Authority – Provincetowne Project Cumbo: Staff went to City Council last week and will return on July 5. Our concern is the future and how it impacts affordable housing and the City. Staff would like to have input from this board. The Fort Collins Housing Authority in partnership with CARE Housing is developing the Provincetowne project, an 85 unit townhome project. It will be available for occupancy this week. Construction started last November and it is a $14M project. In the planning process both entities assumed that by state law and City ordinance development fees and capital expansion fees would be waived. Council was frustrated because fees had been waived in the past, and they thought they would be waived again.. CDNS staff raised the concern that HA was just a .001% owner in project; and, therefore, questioned why they entitled to full waiver of fees? It became a policy issue because the financial impact of that waiver is $509,000. Impact fees leagally 1 ATTACHMENT 6 have to match the cost of the improvements they fund. There are some legal problems if fees get waived and how the costs get covered and backfilled by the general fund. Staff sees a a financial and legal challenge. There was nevrr any question that the City is committed to supporting affordable housing, but nobody anticipated a $500,000 financial challenge to address it. We have had many conversations about it internally (City Manager's Office, City Attorney), the attorneys for CARE Housing and the attorneys for the Housing Authority and they did not all have the same interpretation of state law. Staff is looking at ways to solve the problem. As discussions have continued, the Housing Authority has told us that this project is an anomaly. Future project will plan for these fees and build them into the financing. We want to separate this project and have fees waived, and then we will go back to City Council with some proposals on how to handle this in the future. There is another project (Legacy Senior Housing Project) that is pending and pushing us to get this resolved quickly. However, they will not be anticipating waiver of fees. They will be building those fees into their pro forma. One question was about the percentage of ownership the Housing Authority has in this project. It was determined that the private investor really needs to have 99% ownership. That level of ownership, though it looks to be a very minor level and was the subject of council discussion, is not indicative of the level of responsibility that the Housing Authority has and control they have. We need to describe the role of the Housing Authority better even though their financial participation is .001%. Board Question: What is state statute? Cumbo: It is not clear. One reference speaks to the percentage of ownership, taxes and fees. Another only makes reference to taxes. But, there is a reference to proportional ownership. Board Question: So, the smaller percentage the less the waiver? I didn't see that by having the tiniest fraction of a percentage of ownership they had a full right to a waiver, which would be the state's position. Brewen: The point of difference between the attorneys is that the beginning of the section of state law talks about projects fully owned by the Housing Authority and the fees and special assistance. Later it talks about partnerships in which the Housing Authority is a partial owner or a subsidiary of the Housing Authority as a partial owner. But in that section it only refers to taxes. That is where the nuance is. Cumbo: One of the things we want to clarify is that there is a level of responsibility and control and meeting the City's goals for affordable housing. We might look at if it is a Housing Authority project (however we define it) there will be a waiver of fees. If it is something less than full ownership or control, we look at some criteria for a waiver of 2 ATTACHMENT 6 fees that meet the goals of the affordable housing for the City of Fort Collins. We should deal with them on a case by case basis. It may be that some projects can manage to finance a project and pay the fees. This one was not possible because it was after the fact and so difficult to put the package together to meet the tax credit. The additional $500,000 was a deal killer. If we plan for project going forward we can work together. Board Question: Is there a proposed ordinance? Cumbo: The ordinance that was approved on first reading last week just deals with this project only. It was attached to your packet. What we need is some additional legal research before we can begin to work thru this. One of the things that is being discussed is the need to backfill these fees for capital expansion which are not general fund backed. The city attorney 's office is working on it and looking at other cities. Julie: The tax credit is the real tool right now. Board Question: What does Loveland do? Cumbo: We will go to Loveland and we need time to pull together all of the information. Fort Collins waived fees for the Via Lopez project in 1988-89, there were not as many units and it was spread over two years with fewer fees so the impact was not as significant. Board Question: Was that a percentage ownership, too? Brewen: That was a home ownership project. Board Question: Is there a precedent in the City of Fort Collins of a percentage of ownership on smaller deals. Brewen: Yes, the last two types of tax credit projects that we did were acquisition rehab so the fees were small adding one new structure here and there and we were that .001% owner. Board Question: It seems that the City of Fort Collins was okay with that on smaller deals. Now that it is a larger impact it rises to the surface. The precedent was set. Cumbo: What we faced last week was Council questioning why we didn't tell them about it before and why did you think this would be okay. Because the code says fees are waived and it has been done before. Brewen: We wrote a memo that we were bringing the fee waivers in our formal application, but it was not talking directly to that issue of back filling. Board Question: So the current issue now is that we are here to discuss Provincetowne, or after Provincetowne? 3 ATTACHMENT 6 Cumbo: I think we will deal with Provincetowne. I am interested in your input on the policy going forward. I am not asking for anything formal today. There is precedent, and if that is the direction we should be going that is helpful. But we want you to be aware of what is happening. The mayor was excited at State of the City Address in January, and asking if, with the passing of 2B, can we put more money into affordable housing, but here is another amount after 2B and how can we fund it? The timing and the feeling of no choice and challenges with funding was the council's concern, but also that there have been a lot of challenges in the last couple of months. We and the council want to do the right thing for Affordable Housing and the Housing Authority. We all probably made assumptions that might not have been accurate, but were made with good intent. Board Question: Affordable Housing is community wide and should be addressed as such. Not borne on the backs of new construction. New construction does not cause poverty. General fund is appropriate for the backfill. I have a concern that if the existing Affordable Housing Fund is approached for the back filling, then the project will be taking money from others community wide. Board Question: I saw the ordinance request from the Provincetowne Project and it sounds like at a later date there will be another work session put together to review them. Will we get a chance as a board to review those things before it goes to work session? Cumbo: Yes. I think we are trying to address the situation for the long term without creating undue burden on anyone, but putting together the kinds of tools we need for projects going forward. There are more in the pipeline in the next 3 or 4 years. Board Question: On the larger projects that have tax credits it would be impossible to be more that fractional ownership. If we can limit the waiver of fees on those projects, will that hinder any bigger projects? Brewen: There are a couple of factors. Economic conditions first. One of the things that happened with Provincetowne was around the time the tax credit reservation was made tax credits went down into the 70 cents on the dollar which created a bigger equity gap. The tax credit market has come back around. FCHA is going to be a partner in Legacy with Cornerstone and the market is back into the 80's. You are correct in terms of the percentage ownership. The key going forward and something we might be a small owner in is, if we have the control or the ability to retain perpetually affordability past the investor period, that is a key piece that either council would make a determination on or would be written into the ordinance. It must be made very clear that the Housing Authority has perpetual control. Board Question: In your deals you are making with the investors, are they required to sell out after the compliance period, so the Housing Authority gets the property at that point? Brewen: If anything happens to CARE, then FCHA would take control. 4 ATTACHMENT 6 Cumbo: People got hung up on this and we need to make the bigger picture more clear. Julie: The chart needs to have a sidebar that says of what control we have. It is in the partnership agreement. It lists us as the developer and gives us the right to take Care out as partner. Board Question: So Royal Bank of Canada is the investor? Brewen: Yes, they working with JP Morgan Chase. Board Question: Are private people in the market now? Brewen: Yes, they are in and out. Cumbo: There is a strong commitment here to affordable houseing, but it has to be balanced with everything else. We can find a way through this project and in the future. We don't want to put anything into the code that is going to have to change with the economy. We want to build enough flexibility into it. Board Question: Is the code written now that it is only housing authorities in state law. Cumbo: Yes. Board Question: Is Legacy project similar to a tax credit? Julie: It is a tax credit deal for seniors. Board Question: How does the key issue affect that? Brewen: I have talked to the developer and told them that we really would prefer not to request fees waivers because the pro forma will support the project costs. The tax credit market is so high right now. Board Question: Are you looking for a motion from us today? Or a decision? Cumbo: No, but your input is helpful. And it is another piece of information we will look at moving forward. We will bring back a draft ordinance or outline when we get there in a couple of months. Board Question: So our decision then is only related to Housing Authorities since that is the only one that will potentially be waiving of fees? Karen: Yes. The Housing Authorities are the only ones covered under state law and the City ordinance. Other projects fees are not addressed. 5 ATTACHMENT 6 Waido: I want to remind the Board that in the Strategic Plan that was adopted by Council last July there is policy statement to develop a more permanent revenue stream for the Affordable Housing Fund. It was not defined how that will be. It is open for discussion. It always comes down to money. There are always peaks and valleys of General Fund allocations. We are looking for a more permanent revenue source dedicated to the fund to be put into the more competitive process. Or a fee waiver for the Housing Authority would have a top priority for the fund. Then anything left over could go toward the competitive process. Board Comment: To confirm for all that we are in favor to continue to waiver of the fees for Provincetowne. Is that correct? Brewen: That would be really helpful. This board was aware in 2008 that that was the intent. I am wondering if you can make a statement in support. Board Comment: We can always make a statement to council. That is our job. Cumbo: This is a special meeting and the Board can take formal action if they want, correct? Waido: Yes. Board Question: I was confused that the Council was surprised. This has been around since 2006. Board Comment: CARE was good about pulling it out of the competitive process cycles and they returned the funds. It is time for it to be done. Board Comment: Loveland looked at this project and it seems to fit a model Loveland is trying to get as far as town homes. It is attractive and how it has come together. Board Comment: From city perspective, was the comment from Council merited? Cumbo: One of the things we are learning is that there is a volume problem. Sometimes it gets buried with other stuff. We want to raise issues and identify them early on. It was an unfortunate confluence of events, but there are also two new people on council and we need to find the best way to communicate better. Board Comment: Why didn't CARE want to do the deferral? Brewen: Their permanent loan went out farther than most to 20.5 years. That is the minimum deferral time line. Sometimes it takes a couple of years to process. Board Question: Regarding Provincetowne, do we want to make a statement? If so, what? It sounds like it will happen. 6 ATTACHMENT 6 7 Board Comment: I think we should endorse it and make a formal statement. Do you want a letter? Cumbo: If you made a motion to support the ordinance and waive the fees for Provincetowne, we can include that in the minutes and point that out to Council. That would be helpful. Board Comment: We should it keep it simple. We should talk about the wording more. A Motion? Motion: The Affordable Housing Board makes a motion to support the ordinance as proposed to waive the fees for Provincetowne. Sollenberger: I so move. Miller seconded. All in favor. Motion passed. Board Comment: We would like to be as involved as we can on the changes going forward in the future. Waido: One of the criticisms of the City is that fees add to the cost of housing. That is the way new infrastructure get built and so new development pays its way. Years ago they decided they can't afford to waive fees outright for affordable housing. The delay program was developed. It saves on the loan amounts and interest payments. That was one attempt to reduce the impact. Cumbo: There are legal issues that the fees for utilities are not waived. Most communities don't waive these fees. Julie: At what point do the fees come due? At what point are they needed for more capitol expansion? More research is beginning. Board Comment: Please take back to Council we are empathetic about the financial impact. Meeting Adjourned at 5:00 PM. 1 1 Waiver of Fees –– Ordinance No. 071, 2011 Affordable Housing Project Provincetown, Filing III July 5, 2011 Karen Cumbo, PDT Director 2 Fee Waiver for Affordable Housing: Under Colorado statute and Fort Collins ordinance, projects of housing authorities are exempt from taxes and fees Colorado Statute (CRS 29 - 4- 227) • A Housing Authority is exempt from payment of any taxes and fees ATTACHMENT 7 2 3 Fort Collins Ordinance 65, 1999 • Housing Authority Projects Exempt From Certain Fees: – Appeal Fees – Building Permit Fees – Development Review Fees, Plan Check Fees – Parkland Fees, Park Capital Improvement Fees – Street Oversizing Fees – Vested Property Right and Zoning Variance Fees – Library Capital Improvement Fee – Police and Fire Capital Expansion Fees – General Government Capital Expansion Fees – Fee-In-Lieu of School Site Dedication 4 Provincetown PDP, Filing 3 • 85 Unit Townhome Project • CARE Housing (non-profit) partnering with Fort Collins Housing Authority (FCHA) • Currently under construction • First Units occupied late June • Serving households with annual incomes between $23,000 and $38,350 NN E. Trilby Rd. Carpenter Rd. S. College Ave. Lemay Rd. 3 5 Fees subject to waiver: • Utility Development Review Fees $ 4,762 • Permit and Plan Check Fees $ 42,720 • Capital Expansion Fees* $509,896 TOTAL FEE WAIVER: $557,378 *Capital Expansion Fees include: Fire, Police, Street Oversizing, School District, Community and Neighborhood Parkland, Larimer County Road, and General Government 6 Capital Expansion Fees for Provincetowne Affordable Housing project: • Fire $ 13,523 • Police $ 9,233 • General Government $ 16,920 • Larimer County Road $ 15,725 • Parkland Community $118,830 • Parkland Neighborhood $106,590 • City Street Oversizing $148,665 • School District $ 80,410 TOTAL CAPITAL EXP. FEE WAIVER: $509,896 4 7 Policy Issues to Consider: • Financial Impact of waiving $557,378 • Percent Ownership of Fort Collins Housing Authority: – Technically only a .001 percent partner – Fee waiver passes to other funding partners – FCHA guarantees up to $1.4M in unanticipated costs 8 New Information • Project Chronology • Information About Provincetowne Project • Previous Affordable Housing Fee Waivers • Ramifications if Fee Waiver Not Granted • Other Communities’ Practices • Affordable Housing Board Recommendation 5 9 Council Action Requested: Staff recommends: • Approval of Ordinance No. 071, 2011 – Granting waiver of fees for CARE Housing/FCHA townhomes in Provincetown 3rd Filing • Future Council policy discussion regarding waiver of fees and definition of “ownership” ORDINANCE NO. 071, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROVING THE WAIVER OF CITY FEES FOR THE CARE HOUSING AFFORDABLE HOUSING PROJECT IN THE PROVINCETOWNE SUBDIVISION WHEREAS, the Fort Collins Housing Authority (the “Housing Authority”) has been formed under the auspices of Section 29-4-101, et seq., C.R.S., for the purpose of providing affordable housing to residents of the City; and WHEREAS, the provision of such housing serves an important public purpose; and WHEREAS, in order to foster the provision of affordable housing, both state and local law exempt projects of the Housing Authority from the payment of certain fees and taxes; and WHEREAS, more specifically, Section 29-4-227, C.R.S. states that a housing authority is exempt from the payment of any fees to the state or any subdivision thereof, and that the property of an authority is exempt from all local and municipal taxes, as are bonds and other evidences of indebtedness of an authority, all property leased to an authority for the purposes of a project, and the income derived from the authority by the lessor under such lease; and WHEREAS, Section 29-4-227, C.R.S. also provides that the portion of a residential project that is occupied by persons of low income and that is owned by or leased to an entity that is wholly owned by an authority, or an entity in which an authority has an ownership interest, or an entity in which an entity wholly owned by an authority has an ownership interest shall likewise be exempt from taxation, together with the income derived from the above entities by the lessor under a lease; and WHEREAS, it is unclear under the foregoing state law whether an affordable housing project that is only partially owned by a housing authority is exempt from both fees and taxes; and WHEREAS, Ordinance No. 065, 1999, of the City Council states, in Section 2 thereof, that any housing authority organized pursuant to the provisions of Section 29-4-101, et seq., C.R.S., shall be exempt from the payment of certain City fees specified therein; and WHEREAS, similarly, Section 7.5-17 of the Code of the City, dealing with the City’s capital improvement expansion fees, exempts from the payment of such fees any housing authority organized pursuant to the provisions of Section 29-4-101, et seq., C.R.S.; and WHEREAS, the Housing Authority has entered into an agreement with CARE Housing, a local non-profit corporation, for the purpose of providing affordable housing in the City through a large, multi-family affordable housing project in the Provincetowne subdivision, which is currently under construction; and WHEREAS, because of the tax credit financing arrangement through which the Project is being funded, the Housing Authority currently holds only a small ownership interest in the Project; and WHEREAS, the Director and Board of the Housing Authority have nonetheless recommended that the City waive the Project’s payment of the fees specified in Section 2 of Ordinance No. 065, 1996; and WHEREAS, the City Council believes that the waiver of fees for the Project is in the best interests of the City; and WHEREAS, the City Council also believes that, because the status of these kinds of affordable housing projects under state and local law is unclear with regard to the waiver of City fees, the Council should consider revising the provisions of Ordinance No. 065, 1999, and Section 7.5-17 of the City Code so as to more specifically address, as a matter of ongoing policy, the question of whether and under what circumstances the City fees specified in Section 2 of Ordinance No. 065, 1999, should be waived for affordable housing projects in which the Housing Authority has only a partial ownership interest. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS AS FOLLOWS: Section 1. That the payment of those fees specified in Section 2 of Ordinance No. 065, 1999, is hereby waived for the Project. Section 2. That, to the extent that the waiver of fees contained in Section 1 of this Ordinance may conflict with the provisions of Ordinance No. 065, 1999, Section 7.5-17 of the City Code, or with any other provision of the City Code, City Land Use Code, or with any other ordinance or resolution of the City Council, the provisions of this Ordinance shall supersede any such other conflicting provision. Section 3. That the City Council hereby finds and determines that the provision of incentives by the City to affordable housing projects located in the City is a matter of local concern and that, to the extent that the waiver of fees contained in Section 1 above may be construed to be in conflict with the provisions of Section 29-4-101, et seq., C.R.S., or any other provision of State law, the provisions of this Ordinance shall prevail and shall supersede such other law. Section 4. That the City Manager is hereby directed to prepare a report and recommendation for the City Council’s consideration at an upcoming work session with regard to whether and under what circumstances the City fees specified in Section 2 of Ordinance No. 065, 1999, should be waived for affordable housing projects in which the Housing Authority has only a partial ownership interest. -2- Introduced, considered favorably on first reading, and ordered published this 7th day of June, A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- DATE: July 5, 2011 STAFF: Mike Freeman AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 27 SUBJECT Items Relating to the Fort Collins Museum/Discovery Science Center Project. A. First Reading of Ordinance No. 087, 2011, Appropriating Prior Year Reserves in the General Fund for Transfer to the Capital Projects Fund for the Fort Collins Museum/Discovery Science Center Project. B First Reading of Ordinance No. 088, 2011, Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Fort Collins Museum/Discovery Science Center Project. C. First Reading of Ordinance No. 089, 2011 Appropriating Prior Year Reserves in the Water Fund for the Purpose of Providing a Loan to FCDM, Inc. for the Exhibits of the Fort Collins Museum/Discovery Science Center Project and Appropriating Unanticipated Revenue in the Capital Projects Fund. EXECUTIVE SUMMARY $3,875,000 in funding for the new Fort Collins Museum/Discovery Science Center is needed now to complete the building. Completion is scheduled for November 2011. The Downtown Development Authority (DDA) has committed $3 million for the building, but the funds are not currently available. The DDA is exploring funding options but will not have the funding in 2011. Adoption of Ordinance No. 087, 2011, will appropriate $3 million from General Fund reserves for the museum project to complete the building. The DDA plans to reimburse the City for the $3 million through financing provided by the City or from other funds secured by the DDA. The Non-Profit Corporation (NPC) has committed $4,761,916 to the museum building, with $875,000 of that amount in the form of pledges to be paid between 2012 and 2014. The NPC is working to obtain a private loan for the $875,000 but the financing will be costly and difficult to obtain. Adoption of Ordinance No. 088, 2011, will appropriate $875,000 from reserves in the Water Fund to complete the building. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.5% and a maturity date of December 31, 2014. The loan will be evidenced by a loan and security agreement and corresponding promissory note. The NPC has raised $3.617 million for museum exhibits, with $1.2 million in the form of pledges to be paid in future years (2011-2017). The new museum will open with a nice, but somewhat limited exhibit experience without a bridge loan for the $1.2 million in exhibit pledges. Some exhibits will be postponed, and other exhibits will be more static, without the depth of knowledge or interactive technology that will be possible once the future year pledge money becomes available. Adoption of Ordinance No. 089, 2011, will appropriate $1.2 million from Water Fund reserves for museum exhibits. These funds will be transferred to the Capital Project Fund account for the museum in the form of a loan to the NPC. The anticipated loan terms include an interest rate of 3.75% and a maturity date of December 31, 2017. The loan will be evidenced by a loan and security agreement and corresponding promissory note. BACKGROUND / DISCUSSION PROJECT FUNDING Through Council’s support, the Fort Collins Museum and the Discovery Science Center (DSC) joined together to create an exceptional new museum experience and facility. In 2005, Council included the new museum in the Building on Basics (BOB) capital program, which received strong voter support. BOB provided approximately $6.183 million for the project and required DSC to provide at least $3.6 million in matching funds. BOB also provides $200,000 annually for seven years for operation and maintenance of the new facility. The DSC (which, along with the Museum Advisory July 5, 2011 -2- ITEM 27 Board, has transitioned into the Museum Non-Profit Corporation (NPC)) has raised approximately $8.879 million to date, far exceeding its original $3.6 million commitment. In addition to BOB funding, approximately $6.529 million has been provided from other public sources as follows: • City Natural Resources: $ 1,000,000 (building $265,113 / exhibits $734,887) • Art in Public Places (Utility Project): $ 435,000 • City land donation: $1,730,000 • Department of Local Affairs: $ 200,000 • Colorado Department of Public Health and Environment: $ 75,000 • Downtown Development Authority: $3,000,000 • Estate Gift to the Fort Collins Museum $ 89,000 Other Public Funding $6,529,000 Building on Basics $6,183,000 NPC $8,879,000 Together, public and private contributions to the project total: $21,591,000. Based on these funding commitments, the City sought and secured Council’s approval to appropriate $15,109,666 for the exhibit master plan, and design and construction of the new museum, as follows: $6,183,750 from BOB $3,275,000 ($3 million DDA; $200,000 DOLA; $75,000 grant, Ordinance No.130, 2009) $4,561,916 from the NPC (Ordinance No. 117, 2010) $ 89,000 from Estate Gift (Ordinance No. 101, 2009) $1,000,000 from City Natural Areas Program Allocation of Appropriated Funds $13,218,105 Building $ 1,891,561 Exhibit Master Plan and Natural Areas Exhibits BUILDING FUNDS On January 27, 2010, after completion of the Request for Proposal process, the City entered into a design/build contract with Oz Architecture and Hensel Phelps for $11,400,000. On December 28, 2010, Change Order #1 was issued for $577,347 which increased the building square footage from 39,905 to 46,928. Additionally, Change Order #2 was issued May 4, 2011, for $159,824 for various additional items incorporated into the contract. This brought the contract total to $12,137,171. Remaining appropriated building funds were used for soft costs (fees, environmental tests/services, project management etc.). Building construction began in earnest on August 16, 2010 after completion of the development review process and resolution of a land title issue with railroad right-of-way that required a re-design of a storm water quality pond. Completion of the building is expected in November 2011. As of June 30, 2011, the City has paid $8,754,611 to the contractor for work performed. Additional payments of $3,382,560 are anticipated to complete the building as follows: July 31 $786,000 August 31 $672,560 September 30 $603,500 October 31 $493,500 November 30 $440,000 December 31 $387,000 All available funding for the building has been expended. Consequently, the design/build contract is short by $3,382,560. July 5, 2011 -3- ITEM 27 DDA FUNDING: The $3 million anticipated funding from the DDA is not currently available. The history of the DDA commitment of the funding is as follows: • April 2004: DDA Board approves $1 million for the museum project. • May 2009: DDA Board approves an additional $2 million for the project, with construction anticipated to begin in 2010. • June 2010: DDA and City Finance begin negotiations of terms with Great Western Bank for a 2010 bond issuance and determine capacity is not available to fund the museum commitment in the 2010 bond series. • July 2010: DDA inquires of City project staff as to when the $3 million is required, indicating DDA had to limit the bond principal amount in 2010 and needs to include the museum commitment in its 2012 bond issuance, and suggests working together on some temporary solutions. Staff responds that DDA funds are needed in 2011, but does not take action to identify solutions. • March 2011: DDA is notified by City that project has a funding deficit and needs DDA funds. DDA begins investigating options to fund the $3 million commitment but confirms that funds will not be available in 2011. NPC BUILDING FUNDS The NPC has committed $4,761,916 to the building, with $875,000 of that amount in the form of pledges that will be paid over the next few years. The $875,000 is needed in 2011 to complete the building. The NPC has been working to secure a bridge loan from private lenders for the $875,000, but the tight credit market has made this very challenging and expensive. Annual interest payments in excess of $50,000 are expected. The NPC is committed to bridging the $875,000 in 2011 so the building can be completed. However, if the City provides the funding it would save the project considerable expense and assure timely completion (contingent on resolving the DDA funding problem). The outstanding building pledges are from very reliable organizations, as follows: The Griffin Foundation: $400,000 ($100,000 annually 2011-2014) Woodward: $250,000 in 2012 The Gates Family Foundation: $250,000 in 2013 The Boettcher Foundation: $ 75,000 in 2013 Staff has investigated options for reducing the building expense. Unfortunately, the building project is too far along to afford any significant savings. Staff has already made $300,000 worth of reductions to keep the project within the original budget. Additional reductions would require portions of the building to be unfinished. APPROPRIATION FOR BUILDING Adoption of Ordinance No. 087, 2011, appropriates $3,000,000 from General Fund reserves for the museum project to complete the building. The DDA will reimburse the $3 million by obtaining private financing, or through financing provided by the City, as approved by Council. Adoption of Ordinance No. 088, 2011 appropriates $875,000 from Water Fund reserves to be loaned to the NPC for the museum project to complete the building. CONTRACT IMPLICATIONS If the City fails to make a payment, the City may be in default under the contract. July 5, 2011 -4- ITEM 27 NPC EXHIBIT FUNDS $2.975 million for exhibits has been raised by the NPC. These funds have been restricted by the donors for exhibits and cannot be used for the building. $1.2 million in exhibit donations will be paid in future years as follows: The Bohemian Foundation: $250,000 in late 2011 The Schatz Foundation: $250,000 in 2012 Woodward: $200,000 in 2014 Anonymous Donor: $500,000 ($100,000 annually 2013-2017) The new museum will open with a nice, but somewhat limited exhibit experience absent a bridge loan for the future year exhibit pledges. For example, the early childhood area would not be in place; the live animal exhibit would include only the City’s modest current collection; the bike exhibit would have to wait; and the Flood Theater exhibit would be postponed. Additionally, many exhibits will be more static, without the depth of information or interactive technology that will be possible once the future pledge funds become available. In contrast, three areas (Natural Areas, Science Experience, and Music and Sound) will be fully executed on opening day because they are funded by donations specifically designated for these exhibits. APPROPRIATION FOR EXHIBITS Adoption of Ordinance No. 089, 2011, appropriates $1.2 million from Water Fund reserves to be loaned to the NPC for Museum exhibits and appropriates the same amount in the Capital Projects Fund. THE DIGITAL DOME The Digital Dome Theater is the capstone element of the Museum of Discovery. It provides a 360 degree immersive experience for the exploration of astronomy, music, earth and climate science, art, cultural history, presentations, and events. A $2 million campaign is underway to fund the dome and $500,000 has been raised with $350,000 in the form of future year pledges. The NPC is working to secure a private bridge loan for the $350,000 so the infrastructure for the dome can be completed by the on-site building contractor. Completing this work in the future would be much more ($125,000 to $200,000) expensive. No Council action is being requested regarding the Digital Dome. FINANCIAL / ECONOMIC IMPACTS Adoption of Ordinance No. 087, 2011 appropriates $3,000,000 in the General Fund to cover construction of the Museum building. The DDA’s pledge has already been appropriated in the Capital Projects Fund, however the project is underway and they are unable to make payment at this time. To fund its pledge, the DDA plans to seek external financing. In that scenario the amount of available reserves in the General Fund at the end of 2012 are forecasted to exceed the policy minimum by $7,500,000. If however the DDA instead asks the City for a loan, and the loan is granted, available reserves above the policy minimum will be $4,500,000. Adoption of Ordinance No. 088, 2011 authorizes $875,000 in the Water Fund to be loaned to the NPC. The NPC building commitments have already been appropriated in the project, however the project is underway and they are unable to make payment at this time. The NPC has building pledges equal to their commitment but the pledges will come in installments through 2014. The Water Fund currently has reserves that exceed their policy minimums allowing them to make this loan. The proposed terms are 3.5% annual interest and $875,000 in principal to be paid according the loan agreement. Adoption of Ordinance No. 089, 2011 authorizes $1,200,000 in the Water Fund to be loaned to the NPC, and appropriates the same amount in the Capital Projects Fund for exhibits in the Museum. The NPC has received exhibit pledges of $1,200,000 but the pledges will come in installments through 2017. The Water Fund currently has reserves that exceed their policy minimums allowing them to make this loan. The proposed terms are 3.75% annual interest and $1,200,000 in principal to be paid according the loan agreement. July 5, 2011 -5- ITEM 27 Utilities anticipates that significant capital project needs in the future and ongoing systemic adjustment of Water Utility revenues and operating costs may necessitate water rate increases in the future. The proposed loan of Water Fund reserves is not expected to create additional need for rate increases or to cause the reserves to fall below required levels, assuming that staff-projected rate increases are implemented. The Ordinance provides that it is the Council’s intent that in the event that unexpected capital projects needs or timing results in an increased need for reserves in the Water Fund, the Council would provide replacement funds in order to repay the loan to the Water Fund to meet that need. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. ATTACHMENTS 1. Powerpoint presentation. 2. Downtown Development Authority memo 1 1 New Museum Funding Issues 2 Building on Basics • In 2005 Council included the new museum in the Building on Basics (BOB) capital program • BOB provided $6.183 million and required the Discovery Science Center (DSC) to provide at least $3.6 million ATTACHMENT 1 2 3 Public Funding to Date $12.7 million total public funding: • $6,183,750 from BOB • $3 million from Downtown Development Authority (DDA) • $1 million from Natural Resources • $1.73 million from the City for the value of the land 4 Private Funding to Date • DSC original commitment through BOB was $3.6 million • DSC has raised ~$8.379 million to date, plus $500,000 for the digital dome 3 5 Public/Private Funding to Date • Public Funds: $12.712 million • Private Funds: $8.879 million • Total Funds raised: $21.591 million • Appropriated $15,109,666 in 2009 and 2010 for the building and exhibits • The remaining $6.481 million represents the value of the land, art in public places and additional exhibit and dome funding 6 Design/Build Contract • Original Contract: $11.4 million (January 10, 2010) • Contract increased to $12,137,171 through designated private donation to increase square footage from 39,905 to 46,928 sq. ft. • $8,754,611 has been paid to the contractor for work completed • $3,382,560 is remaining to be paid to the contractor between July and December 4 7 Cash Flow Issues • All available building funding has been expended, leaving the project short by $3,382,560 • The $3 million commitment from the DDA is not currently available • The DDA was not able to include the $3 million in their 2010 bond issuance 8 Private Pledges • The museum non-profit corporation (NPC) (formerly the DSC) committed $4,561,916 of their funding to the museum building • $875,000 is in pledge form to be paid from 2012- 2014 • The NPC is working to secure a bridge loan from private lenders for the $875,000 but it is proving to be difficult and expensive 5 9 Council Options Building Construction • Loan • No Loan • Stop Work 10 DDA Loan • Adoption of Ordinance No. , 2011 transfers $3,000,000 from General Fund reserves for the museum building Impacts: • Allows construction to continue and be completed • Reduces General Fund reserve balance from $40,924,107 to $37,924,107 • The remaining reserve balance may fall below the minimum 60 day amount established by the Council reserve policy, depending on City revenue and expenditures in 2011 6 11 DDA Loan • Staff will continue working with the DDA in 2011 on options to reimburse the $3 million, including private financing or possible long-term financing provided by the City, if approved by Council 12 NPC LOAN • Adoption of Ordinance No. , 2011appropriates $875,000 from Water Fund Reserves for the museum building • The NPC will repay the $875,000 from 2012-2014 as pledge revenues are received • Water Fund reserves will still exceed reserve policy limits • The NPC will pay interest at the rate of 3.5% 7 13 No Loan or Work Stoppage No Loan - Building not completed - City defaults on design/build contract - Do not deliver voter approved project Work Stoppage for 90 Days - Allows Time for DDA/NPC to possibly secure private loans - Liability to contractor, estimated at $600,000 14 Exhibit Loan • The NPC has raised $2.975 million for exhibits • $1.2 million of this exhibit funding will be paid as follows: $250,000 in 2011 $250,00 in 2012 $100,000 in 2013 $300,000 in 2014 $100,000 in 2015, 2016 and 2017 • The NPC does not have the ability to obtain a private loan for the $1.2 million • The NPC would reimburse the City for the $1.2 million as the exhibit pledges are paid 8 15 Exhibit Options • Exhibit Bridge Loan • No Loan 16 EXHIBIT BRIDGE LOAN • Approval of Ordinance No. , 2011 appropriates $1.2 million from Water Fund reserves for exhibits • Water Fund reserves will still exceed reserve policy limits • NPC will pay interest at the rate of 3.75% 9 17 Impacts of Bridge Loan for Exhibits • The exhibit plan will be complete when the new museum opens including: early childhood; live animals; bicycles and the Flood Theater • Other exhibits will be fully executed, including interactive technology 18 Impacts of No Exhibit Loan • Some exhibits will be postponed and many exhibits will not have the depth of information or interactive technology that will be possible once the future year pledges become available ATTACHMENT 2 ORDINANCE NO. 087, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING PRIOR YEAR RESERVES IN THE GENERAL FUND FOR TRANSFER TO THE CAPITAL PROJECTS FUND FOR THE FORT COLLINS MUSEUM/DISCOVERY SCIENCE CENTER PROJECT WHEREAS, on November 1, 2005, Fort Collins voters passed Ordinance No. 092, 2005, approving the “Building on Basics” (“BOB”) tax for certain capital projects; and WHEREAS, $6,000,000 was included in the BOB capital project program for construction of a new combined-use facility for the Fort Collins Museum/Discovery Science Center (the “Project”); and WHEREAS, the City and Discovery Center, a Colorado non-profit corporation, d/b/a/ Discovery Science Center, now officially known as FCDM, Inc. (the “NPC”), entered into an operating agreement for the construction and operation of the Project; and WHEREAS, the Project will be jointly owned, managed and funded by the City and the NPC; and WHEREAS, the City Council, through various appropriation ordinances, has previously appropriated $15,109,666 for the construction of the Project, which appropriations include $3,000,000 in anticipated revenues from the Downtown Development Authority (“DDA”); and WHEREAS, in January 2010, the City entered into a design-build contract for the construction of the Project and construction commenced in August 2010; and WHEREAS, construction on the Project is continuing and the Project will incur additional construction costs through December 31, 2011; and WHEREAS, the DDA expected that its $3,000,000 commitment to the Project, which has been approved by the DDA Board of Directors, would be funded with proceeds from its 2010 bond issuance; and WHEREAS, because of market condition and state legislation that had the effect of lowering the DDA’s tax revenue, the DDA was not able to issue bonds in an amount sufficient to generate the funds needed to meet its obligation to the Project; and WHEREAS, as a result of the inability of the DDA to provide $3,000,000 in time to meet the Project’s construction schedule, the Project’s capital project account does not have sufficient funds to cover the remaining construction costs of approximately $3,382,560 that are likely to be incurred by the City to complete the Project; and WHEREAS, in order to avoid delaying the opening of the Project, and to avoid the potentially significant and additional contract expenses that may result if construction of the Project is suspended, the City Council believes that it is in the best interest of the City to appropriate from General Fund reserves the amount of $3,000,000 to be used for construction of the Project; and WHEREAS, the DDA is continuing its efforts to obtain financing for its share of the funding shortfall so that the City can be repaid and the funds advanced by this ordinance restored to the General Fund reserve account as soon as possible; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS that there is hereby appropriated for expenditure from prior year reserves in the General Fund the total sum of THREE MILLION DOLLARS ($3,000,000) to be transferred to the Capital Projects Fund for expenditure in the Fort Collins Museum/Discovery Science Center capital project Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _________________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk ORDINANCE NO. 088, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING PRIOR YEAR RESERVES IN THE WATER FUND FOR THE PURPOSE OF PROVIDING A LOAN TO FCDM, INC. FOR THE FORT COLLINS MUSEUM/DISCOVERY SCIENCE CENTER PROJECT WHEREAS, on November 1, 2005, Fort Collins voters passed Ordinance No. 092, 2005, approving the “Building on Basics” (“BOB”) tax for certain capital projects; WHEREAS, $6,000,000 was included in the BOB capital project program for construction of a new combined–use facility for the Fort Collins Museum/Discovery Science Center (“Project”); and WHEREAS, the City and Discovery Center, a Colorado non-profit corporation, d/b/a Discovery Science Center, now officially know as FCDM, Inc. (the “NPC”), entered into an operating agreement for the construction and operation of the Project; and WHEREAS, the Project will be jointly owned, managed, and funded by the City and the NPC; and WHEREAS, the City Council, through various appropriation ordinances, has previously appropriated $15,109,666 for the construction of the Project, which appropriations include $4,561,916 in anticipated revenues raised by the NPC and its predecessor; and WHEREAS, in January 2010, the City entered into a design–build contract for the construction of the Project and construction commenced in August 2010; and WHEREAS, construction on the Project is continuing and the Project will incur additional construction costs through December 31, 2011; and WHEREAS, $875,000 of the NPC funds previously appropriated by the City Council for construction of the Project is in the form of donor pledges that are to be paid between 2011 and 2014, so the majority of these donor funds are not available at this time to be applied to the remaining construction costs of the Project; and WHEREAS, the $875,000 in NPC funds is needed to help cover the remaining construction costs that are likely to be incurred by the City to complete the Project; and WHEREAS, in order to avoid delaying the opening of the Project, and to avoid the potentially significant and additional contract expenses that may result if construction of the Project is suspended, the City Council believes that it is in the best interest of the City to appropriate from reserves in the Water Fund the amount of $875,000 and to transfer that amount to the Capital Projects Fund in the form of a loan to the NPC for the Project (the “NPC Loan”); and WHEREAS, City staff has prepared a proposed promissory note (the “Note”) and a loan agreement in the form entitled “Loan and Security Agreement Between the City of Fort Collins, Colorado and FCDM, Inc. for Funding the Fort Collins Museum/Discovery Science Center Project” (the “Loan Agreement”) attached hereto as Exhibit “A”; and WHEREAS, Article V, Section 12, of the City Charter permits the City Council to provide direction as to the investment of City funds; and WHEREAS, while the NPC Loan does not fit within the categories of approved investments established in the Investment Policy approved by the City Council in 2008, the City Council finds that, based on the interest rate, the collateral provided for the loan, and other conditions in the Loan Agreement, the NPC loan is a suitable investment for the Water Fund reserves; and WHEREAS, the NPC Loan will not necessitate any increase in water rates above those already projected by staff, and after investing the Water Fund reserves in the NPC Loan, the Water Fund will still have a sufficient balance of reserve funds to meet reserve fund requirements, assuming that the projected rate increases are implemented; and WHEREAS, in the event that the timing of, or unanticipated need for, Water Utility capital improvements results in a need for the NPC Loan funds to be restored to the Water Fund, it is the intent of the Council to provide a replacement funding source for the NPC Loan; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from Water Fund reserves the amount of EIGHT HUNDRED SEVENTY FIVE THOUSAND DOLLARS ($875,000) for the purpose of making a loan to the NPC for its remaining share of the construction costs for the Project. Section 2. That the Note, Loan Agreement, and related documents are hereby approved on substantially the terms and conditions contained therein, subject to modifications in form and substance as the Mayor may, in consultation with the City Attorney, deem to be desirable and necessary to protect the interests of the City. -2- Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- LOAN AND SECURITY AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND FCDM, INC. FOR FUNDING THE FORT COLLINS MUSEUM/DISCOVERY SCIENCE CENTER PROJECT THIS LOAN AND SECURITY AGREEMENT (the “Agreement”) is made this ___ day of July, 2011, by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation (the “City”), and FCDM, Inc., a Colorado nonprofit corporation (the “NPC”). RECITALS 1. The NPC is a nonprofit corporation that was formerly known as the Discovery Center d/b/a Discovery Science Center. The purpose of the NPC is to support the construction and operation of the Fort Collins Museum/Discovery Science Center joint facility project (the “Project”). 2. In March 2008, the City and the NPC entered into an operating agreement for the funding and operation of the Project (the “Operating Agreement”). The Operating Agreement describes the Project as consisting of, among other things, the “Facility”. The Facility is defined in the Operating Agreement as the land, buildings and associated improvements that make up the physical plant for the Project. 3. In the Operating Agreement, the NPC agreed to provide no less than $2,500,000 for design and construction of the Project. Subsequently, the NPC has committed to provide an additional $ 2,061,961.00 , for a total of $4,561,916. By Ordinance No. 117, 2010, the City Council appropriated this amount into the City’s capital project fund for the construction of the Project. 4. Included in the amount committed by the NPC are amounts the NPC anticipates receiving from pledges by private donors, in the aggregate amount of $875,000, which the donors have committed to fund in years 2012 through 2014 (the “Outstanding Pledges”). 5. Construction of the Project is expected to be completed in November 2011. In order to help fund the remaining construction costs, the City and the NPC would like the funds represented by the Outstanding Pledges be made available by the NPC in 2011, instead of the schedule by which the NPC anticipated collection of Outstanding Pledges. In the spirit of the Operating Agreement, the NPC desires to make the funds available to the City, but will require financing in order to do so. Although private lenders have expressed some interest in providing financing to the NPC, the proposed terms are unfavorable. The parties acknowledge that the cost of the financing will reduce the NPC’s capital available for future support for the Project. 6. The City and the NPC are willing to enter into this Loan and Security Agreement to provide for the extension of credit by the City to the NPC, as Borrower, and for the creation of a 1 security interest in certain property of the Borrower to secure repayment of the Loan, all on the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties agree as follows: Section 1. The Loan. After the effective date of this Agreement (the “Effective Date”), the adoption of the required ordinances and resolutions by the City, the approval of the Agreement by the NPC Board of Directors, and the execution of a promissory note and other documents as may reasonably be required, the NPC agrees to pay to the City the principal sum actually transferred by the City to the capital project account for the Project on the NPC’s behalf, but not to exceed Eight Hundred Seventy Five Thousand Dollars ($875,000). The NPC agrees and acknowledges that the loan proceeds will be transferred by the City to the City’s capital project account for the Project, and will not be disbursed to the NPC. Section 2. Interest. Interest on the Loan will accrue at a rate equal to ______%. Section 3. Payment Terms. The Loan and accrued interest will be due and payable by the NPC to the City as set forth in the payment schedule contained on Exhibit A, attached hereto and incorporated into this Agreement. All unpaid principal of the Loan, interest, default interest, fees and charges for the Loan will mature on the December 31, 2014 (the “Maturity Date”). Section 4. No Prepayment Penalty. The NPC, in its sole discretion, may prepay all or any portion of the Loan at any time and any such prepayment will be without any prepayment penalty. If a prepayment is made, the funds will be applied first to any interest that has accrued and then the balance of the payment will be applied to the reduction of principal. Section 5. Security Agreement. As security for the Loan, the Borrower agrees: (a) that any unpaid principal and interest due and payable to the City on the Maturity Date will be considered a documented expenditure under Section 3.1 of the Operating Agreement for purposes of determining the City’s Ownership Interest in the Facility. (b) that any surplus Institution Revenue, defined in Section 7.2 and Section 7.3 of the Operating Agreement, will be used, if necessary, to pay the principal and interest due on the Loan. (c) to execute a promissory note (the “Note”) substantially in the form of Exhibit B. (d) that Borrower grants to the City a security interest in all of the Borrower’s rights to payment under any and all donor pledge agreements, including the Outstanding Pledges, that represent unrestricted pledges or pledges 2 for the construction or operation of the Project (the “Collateral”). This Agreement does not grant the City a security interest in pledge agreements that are specifically, by the terms of the pledge agreement, for pledges by private donors that are to be used solely for the purpose of the creation or acquisition of Project exhibits or other designated Project components. (1) Borrower represents that it has not previously granted a security interest in any of the Collateral. (2) Borrower agrees that if it is in default under this Agreement or the Note, the City may notify any donor whose pledge to the NPC constitutes Collateral for the City’s security interest and request payment directly to the City, on behalf of the NPC. Section 6. Default. Upon the occurrence of any of the events listed below in this Section 6, all of the obligations of the Borrower under the Note and this Agreement and any other documents executed by Borrower in connection with the loan contemplated by this Agreement (“Loan Documents”), at the option of the holder thereof, shall become immediately due and payable: (a) the Borrower, without the consent of the City, allows the creation of any lien or encumbrance on the Collateral. (b) the Borrower fails to comply with any of the terms, covenants or conditions contained in this Agreement, the Note, or the other Loan Documents, and the situation is not remedied within 10 business days after Borrower’s receipt of written notice from the City. (c) a petition in bankruptcy is filed by or against the Borrower and is not dismissed within 60 days, or a receiver or trustee of the Borrower is appointed, or the Borrower makes an assignment for the benefit of creditors, or Borrower is adjudged insolvent by any state or federal court of competent jurisdiction. If Borrower is in default, in addition to the remedies provided in the Note or this Agreement, the City shall have any and all rights and remedies permitted under applicable law. Section 7. Waiver. No consent or waiver, express or implied, or the acceptance of a late payment, or the failure to enforce any of Borrower’s obligations under this Agreement, the Note, or other Loan documents, will be construed as a waiver of any breach or default by Borrower. Section 8. Attorney’s Fees and Costs. In the event either party commences any proceeding to enforce the Agreement, or the Note, the prevailing party therein shall be entitled to an award of all of its costs and expenses incurred therein and in connection therewith, including its reasonable attorney’s fees. 3 Section 9. Assignment. This Agreement, the Note, and the Loan Documents, are nonassignable and nontransferable by Borrower, by operation of law, or otherwise, and any attempt to do so shall be null and void. This Agreement, the Note, and the Loan Documents may be fully assigned by the City. Section 10. Notice. Any notice required with respect to the Agreement or the Note, is to be delivered in writing to be accomplished by personal delivery or mailing postage prepaid by the United States Postal Service, or other commercial carrier to the following addresses: If to the City City of Fort Collins Director of Finance PO Box 580 Fort Collins, CO 80522-0580 If to the NPC Executive Director FCDM, Inc. 200 Mathews St. Fort Collins, CO 80524. Section 11. Entire Agreement. This Agreement will be construed according to its fair meaning, as if prepared by both Parties. This Agreement, and the documents executed pursuant to the Agreement, contain the sole and entire agreement and understanding of the parties with respect to the subject matter of the Agreement, and incorporate all prior discussions, negotiations and understandings. This Agreement cannot be changed, modified or amended, except in writing, executed by both parties. This Agreement is solely for the benefit of Borrower, and no person shall be deemed a third party beneficiary of this Agreement. Section 12. Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Colorado. CITY: CITY OF FORT COLLINS, COLORADO, a municipal corporation By: Karen Weitkunat, Mayor ATTEST: By: Wanda Krajiceck, City Clerk 4 5 APPROVED AS TO FORM: By: Assistant City Attorney FCDM, Inc.: By:_________________________________ Board President Non Profit Corporation Building Pledges Loan agreement from City's Water Fund to Museum Non-Profit Corporation Loan Amount 875,000.00 Start Date 1-Aug-11 * Interest Rate 3.500% * Matures 31-Dec-14 Years 3 5/12 Time in Years Date Payment Interest Principal Balance - 1-Aug-11 875,000.00 1.42 31-Dec-12 393,385.42 43,385.42 350,000.00 525,000.00 2.42 31-Dec-13 443,375.00 18,375.00 425,000.00 100,000.00 3.42 31-Dec-14 103,500.00 3,500.00 100,000.00 - 940,260.42 65,260.42 875,000.00 * Dates and rates are preliminary. Specifics will be set after the loan is authorized. The interest rate equals the current prime lending rate of 3.25% plus 0.25% Draft June 13, 2011 PROMISSORY NOTE $875,000 July ___, 2011 FOR VALUE RECEIVED, FCDM, Inc., (“Borrower”), promises to pay to the order of THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“Lender”), at its office at 300 LaPorte Avenue, Fort Collins, Colorado 80524, in lawful money of the United States of America the principal amount of Eight Hundred Seventy Five Thousand Dollars ($875,000). This Promissory Note is issued pursuant to the Loan and Security Agreement between the City of Fort Collins and FCDM, Inc. dated July ___, 2011, between Borrower and Lender (the “Agreement”). Capitalized terms used herein but not defined herein have the meanings given such terms in the Loan Agreement. The obligations of Borrower evidenced by this Promissory Note are payable in accordance with the terms and conditions of the Agreement. The rate of interest borne by this Promissory Note is a fixed rate equal to ________ % per annum (“Interest Rate”). Final payment of all unpaid Principal and accrued interest, plus any default interest, fees and charges owing under this Note, will be due and payable on December 31, 2014 (the “Maturity Date”). The annual interest rate of this Promissory Note is computed on a 360 day year basis, multiplied by the actual number of days elapsed. The Loan may be drawn 100% upon execution of the Loan Documents, or in part from time to time, but not more frequently than monthly. Unless otherwise agreed to or as may be required by applicable law, payments will be applied first to any accrued interest; then to principal; then to any late charges; and then to any unpaid collection costs. If Lender refers this Note to an attorney for collection or seeks legal advice following a default beyond all cure periods allowed under this Note, or the Lender is the prevailing party in any action instituted on this Note, or if any other judicial or non-judicial action, suit or proceeding is instituted by Lender or any future holder of this Note, and an attorney is employed by Lender to appear in any such action or proceeding, or to reclaim, seek relief from a judicial or statutory stay, sequester, protect, preserve or enforce Lender’s interest in this Note, the Loan Documents or any other security for this Note (including, but not limited to, proceedings under federal bankruptcy law or in connection with any state or federal tax lien), then Borrower promises to pay reasonable attorneys’ fees and reasonable costs and expenses incurred by Lender and/or its attorney in connection with the above-mentioned events. If not paid within ten (10) days after such fees become due and written demand for payment is made, such amount shall be due on demand or may be added to the principal, at the Lender’s discretion. If any payment or installment due under this Note is not paid when it becomes due and payable, Borrower recognizes that the Lender will incur extra expenses for both the administrative cost of handling delinquent payments and the cost of funds incurred by Lender after the due date. Therefore, Borrower shall, in such event, without further notice, and without prejudice to the right of Lender to collect any other amounts provided to be paid herein, including default interest or to declare a default hereunder, pay to Lender to cover such expenses {00584920 / 4} - 2 - incurred as a result of any installment payment due being not received within ten (10) days of its due date, a “late charge” of five percent (5%) of the amount of such delinquent payment. Except as otherwise provided herein, the Borrower waives presentment and demand for payment, notice of acceleration or of maturity, protest and notice of protest and nonpayment, bringing of suit and diligence in taking any action to collect sums owing hereunder and agrees that its liability on this Note shall not be affected by any release or change in any security for the payment of this Note or release of anyone liable hereunder. No extension of time for the payment of this Note, or any installment or other modification of the terms made by the Lender with any person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note of the Borrower, even provided the Borrower is a party to such agreement. In no event whatsoever shall the amount paid, or agreed to be paid, to the holder of this Note for the use, forbearance or retention of the money to be loaned hereunder (“Interest”) exceed the maximum amount permissible under applicable law. If the performance or fulfillment of any provision hereof or of any of the Loan Documents or any agreement between Borrower and the Lender of this Note shall result in Interest exceeding the limit for interest prescribed by law, then the amount of such Interest shall be reduced to such limit. If, from any circumstance whatsoever, the Lender of this Note should receive as Interest, an amount which would exceed the highest lawful rate, the amount which would be excessive Interest shall be applied to the reduction of the principal balance owing (or, at the option of the Lender, be paid over to Borrower) and not to the payment of Interest. If any provision hereof or any of the Loan Documents shall, for any reason and to any extent, be invalid or unenforceable, then the remainder of the document or instrument in which such provision is contained and any of the other Loan Documents shall not be affected thereby but instead shall be enforceable to the maximum extent permitted by law. Borrower and Lender hereby knowingly, voluntarily, and intentionally waive any rights they may have to a trial by jury in respect of any litigation based hereon or arising out of, under or in connection with this note or any course of conduct, course of dealing, statements (whether oral or written) or actions of the other party. This Promissory Note shall be construed in accordance with the laws of the State of Colorado. IN WITNESS WHEREOF, Borrower has duly executed this Promissory Note as of the day and year first above written. BORROWER: FCDM, Inc. By: Executive Director ORDINANCE NO. 089, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING PRIOR YEAR RESERVES IN THE WATER FUND FOR THE PURPOSE OF PROVIDING A LOAN TO FCDM, INC. FOR THE EXHIBITS OF THE FORT COLLINS MUSEUM/DISCOVERY SCIENCE CENTER PROJECT AND APPROPRIATING UNANTICIPATED REVENUE IN THE CAPITAL PROJECTS FUND WHEREAS, on November 1, 2005, Fort Collins voters passed Ordinance No. 092, 2005, approving the “Building on Basics” (“BOB”) tax for certain capital projects; and WHEREAS, $6,000,000 was included in the BOB capital project program for construction of a new combined-use facility for the Fort Collins Museum/Discovery Science Center (“the Project”); and WHEREAS, in March 2008, the City and the Discovery Center, a Colorado non-profit corporation, d/b/a Discovery Science Center (the “NPC”), now officially known as FCDM, Inc., entered into an operating agreement for the construction and operation of the Project; and WHEREAS, the Project will be jointly owned, managed, and funded by the City and the NPC and will expand the educational experience of city residents by providing a broader array of scientific, cultural and historical exhibits in a single location, and will also provide an exciting new City amenity; and WHEREAS, the NPC has raised $3,617,000 for museum exhibits, with $1.2 million of that amount coming from pledges to be paid between 2011 and 2017; and WHEREAS, the museum exhibits will be limited until the entire amount of $1.2 million is available to complete the exhibit experience; and WHEREAS, in order that the Project can open in 2012 with a more complete exhibit experience, and in order to avoid the inefficiencies that would result if the exhibit installation were to be delayed, the City Council believes that it is in the best interest of the City to appropriate from reserves in the Water Fund the amount of $1,200,000 and to transfer that amount to the Capital Projects Fund in the form of a loan to the NPC for the Project (the “NPC Loan”); and WHEREAS, City staff has prepared a proposed promissory note (the “Note”) and a loan agreement in the form entitled “Loan and Security Agreement Between the City of Fort Collins, Colorado and FCDM, Inc. for Funding Exhibits of the Fort Collins Museum/Discovery Science Center Project” (the “Loan Agreement”) attached hereto as Exhibit “A”; and WHEREAS, Article V, Section 12, of the City Charter permits the City Council to provide direction as to the investment of City funds; and WHEREAS, while the NPC Loan does not fit within the categories of approved investments established in the Investment Policy approved by the City Council in 2008, the City Council finds that, based on the interest rate, the collateral provided for the NPC Loan, and other conditions in the Loan Agreement, the NPC Loan is a suitable investment for the Water Fund reserves; and WHEREAS, the NPC Loan will not necessitate any increase in water rates above those already projected by staff, and after investing the Water Fund reserves in the NPC Loan, the Water Fund will still have a sufficient balance of reserve funds to meet reserve fund requirements, assuming that the projected rate increases are implemented; and WHEREAS, in the event that the timing of, or unanticipated need for, Water Utility capital improvements results in a need for the NPC Loan funds to be restored to the Water Fund, it is the intent of the Council to provide a replacement funding source for the NPC Loan; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated. WHEREAS, Article V, Section 9, of the City Charter authorizes the City Council to make supplemental appropriations by ordinance at any time during the fiscal year, provided that the total amount of such supplemental appropriations, in combination with all previous appropriations for that fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, City staff has determined that the appropriation of the revenue as described herein will not cause the total amount appropriated in the Capital Project fund to exceed the current estimate of actual and anticipated revenues to be received in that fund during any fiscal year. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from Water Fund reserves the amount of ONE MILLION TWO HUNDRED THOUSAND DOLLARS ($1,200,000) for the purpose of making a loan to the NPC to fund exhibit costs for the Project. Section 2. That the Note, Loan Agreement, and related documents are hereby approved on substantially the terms and conditions contained therein, subject to modifications in form and substance as the Mayor may, in consultation with the City Attorney, deem to be desirable and necessary to protect the interests of the City. Section 3. That there is hereby appropriated from unanticipated revenue in the Capital Projects Fund the sum of ONE MILLION TWO HUNDRED THOUSAND DOLLARS ($1, 200,000) for expenditure on the Project. -2- Introduced, considered favorably on first reading, and ordered published this 5th day of July, A.D. 2011, and to be presented for final passage on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 19th day of July, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- LOAN AND SECURITY AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND FCDM, INC. FOR FUNDING EXHIBITS OF THE FORT COLLINS MUSEUM/DISCOVERY SCIENCE CENTER PROJECT THIS LOAN AND SECURITY AGREEMENT (the “Agreement”) is made this ___ day of July, 2011, by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation (the “City”), and FCDM, Inc., a Colorado nonprofit corporation (the “NPC”). RECITALS 1. The NPC is a nonprofit corporation that was formerly known as the Discovery Center d/b/a Discovery Science Center. The primary purpose of the NPC is to support the construction and operation of the Fort Collins Museum/Discovery Science Center joint facility project (the “Project”). 2. In March 2008, the City and the NPC entered into an operating agreement for the funding and operation of the Project (the “Operating Agreement”). The Operating Agreement describes the Project as consisting of, among other things, the “Facility”. The Facility is defined in the Operating Agreement as the land, buildings and associated improvements that make up the physical plant for the Project. 3. In the Operating Agreement, the NPC agreed to provide no less than $1,100,000 for acquisition or creation of Project exhibits. The NPC has raised $2,975,000 for Project exhibits, which includes the sum of $1,200,000 from pledges to the NPC by private donors. These pledges have already been made, and are anticipated to be collected by the NPC in future years (the “Outstanding Pledges”). 4. The Project is expected to be open to the public in 2012. In order to help fund the exhibit costs so that the Project can open with a more complete exhibit experience for its patrons, the City and the NPC would like the funds represented by the Outstanding Pledges be made available in 2011, instead of the schedule by which the NPC anticipated collection of Outstanding Pledges. In the spirit of the Operating Agreement, the NPC desires to make the funds available, but will require financing in order to do so. The parties acknowledge that the cost of the financing will reduce the NPC’s capital available for future support for the Project. 5. The City and the NPC are willing to enter into this Loan and Security Agreement to provide for the extension of credit by the City to the NPC, as Borrower, and for the creation of a security interest in certain property of the Borrower to secure repayment of the Loan, all on the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties agree as follows: 1 Section 1. The Loan. After the effective date of this Agreement (the “Effective Date”), the adoption of the required ordinances and resolutions by the City, the approval of the Agreement by the NPC Board of Directors, and the execution of a promissory note and other documents as may reasonably be required, the NPC agrees to pay to the City the principal sum actually transferred by the City to the capital project account for the Project on the NPC’s behalf, but not to exceed One Million Two Hundred Thousand Dollars ($1,200,000). The NPC agrees and acknowledges that the loan proceeds will be transferred by the City to the City’s capital project account for the Project, and will not be disbursed to the NPC. Section 2. Interest. Interest on the Loan will accrue at a rate equal to ______%. Section 3. Payment Terms. The Loan and accrued interest will be due and payable by the NPC to the City as set forth in the payment schedule contained on Exhibit A, attached hereto and incorporated into this Agreement. All unpaid principal of the Loan, interest, default interest, fees and charges for the Loan will mature on the December 31, 2017 (the “Maturity Date”). Section 4. No Prepayment Penalty. The NPC, in its sole discretion, may prepay all or any portion of the Loan at any time and any such prepayment will be without any prepayment penalty. If a prepayment is made, the funds will be applied first to any interest that has accrued and then the balance of the payment will be applied to the reduction of principal. Section 5. Security Agreement. As security for the Loan, the Borrower agrees: (a) that any unpaid principal and interest due and payable to the City on the Maturity Date will be considered a documented expenditure under Section 3.1 of the Operating Agreement for purposes of determining the City’s Ownership Interest in the Facility. (b) that any surplus Institution Revenue, defined in Section 7.2 and Section 7.3 of the Operating Agreement, will be used, if necessary, to pay the principal and interest due on the Loan. (c) to execute a promissory note (the “Note”) substantially in the form of Exhibit B. (d) that Borrower grants to the City a security interest in all of the Borrower’s rights to payment under any and all donor pledge agreements, including the Outstanding Pledges, that represent unrestricted pledges or pledges and other assets donated for Project Exhibits (the “Collateral”). This Agreement does not grant the City a security interest in pledge agreements that are specifically, by the terms of the pledge agreement, for pledges by private donors that are to be used solely for the purpose of construction or operation of the Project. 2 (1) Borrower represents that it has not previously granted a security interest in any of the Collateral. (2) Borrower agrees that if it is in default under this Agreement or the Note, the City may notify any donor whose pledge to the NPC constitutes Collateral for the City’s security interest and request payment directly to the City, on behalf of the NPC. Section 6. Default. Upon the occurrence of any of the events listed below in this Section 6, all of the obligations of the Borrower under the Note and this Agreement and any other documents executed by Borrower in connection with the loan contemplated by this Agreement (“Loan Documents”), at the option of the holder thereof, shall become immediately due and payable: (a) the Borrower, without the consent of the City, allows the creation of any lien or encumbrance on the Collateral. (b) the Borrower fails to comply with any of the terms, covenants or conditions contained in this Agreement, the Note, or the other Loan Documents, and the situation is not remedied within 10 business days after Borrower’s receipt of written notice from the City. (c) a petition in bankruptcy is filed by or against the Borrower and is not dismissed within 60 days, or a receiver or trustee of the Borrower is appointed, or the Borrower makes an assignment for the benefit of creditors, or Borrower is adjudged insolvent by any state or federal court of competent jurisdiction. If Borrower is in default, in addition to the remedies provided in the Note or this Agreement, the City shall have any and all rights and remedies permitted under applicable law. Section 7. Waiver. No consent or waiver, express or implied, or the acceptance of a late payment, or the failure to enforce any of Borrower’s obligations under this Agreement, the Note, or other Loan documents, will be construed as a waiver of any breach or default by Borrower. Section 8. Attorney’s Fees and Costs. In the event either party commences any proceeding to enforce this Agreement, or the Note, or other Loan Documents, the prevailing party therein shall be entitled to an award of all of its costs and expenses incurred therein and in connection therewith, including its reasonable attorney’s fees. Section 9. Assignment. This Agreement, the Note, and the Loan Documents, are nonassignable and nontransferable by Borrower, by operation of law, or otherwise, and any attempt to do so shall be null and void. This Agreement, the Note, and the Loan Documents may be fully assigned by the City. 3 Section 10. Notice. Any notice required with respect to the Agreement or the Note, is to be delivered in writing to be accomplished by personal delivery or mailing postage prepaid by the United States Postal Service, or other commercial carrier to the following addresses: If to the City City of Fort Collins Director of Finance PO Box 580 Fort Collins, CO 80522-0580 If to the NPC Executive Director FCDM, Inc. 200 Mathews St. Fort Collins, CO 80524. Section 11. Entire Agreement. This Agreement will be construed according to its fair meaning, as if prepared by both Parties. This Agreement, and the documents executed pursuant to the Agreement, contain the sole and entire agreement and understanding of the parties with respect to the subject matter of the Agreement, and incorporate all prior discussions, negotiations and understandings. This Agreement cannot be changed, modified or amended, except in writing, executed by both parties. This Agreement is solely for the benefit of Borrower, and no person shall be deemed a third party beneficiary of this Agreement. Section 12. Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Colorado. CITY: CITY OF FORT COLLINS, COLORADO, a municipal corporation By: Karen Weitkunat, Mayor ATTEST: By: Wanda Krajiceck, City Clerk APPROVED AS TO FORM: By: Assistant City Attorney 4 5 FCDM, Inc.: By:_________________________________ Board President Non Profit Corporation Exhibit Pledges Loan agreement from City's Water Fund to Museum Non-Profit Corporation Loan Amount 1,200,000.00 Start Date 1-Aug-11 * Interest Rate 3.750% * Matures 31-Dec-17 Years 6 5/12 Time in Years Date Payment Interest Principal Balance - 1-Aug-11 1,200,000.00 0.42 31-Dec-11 268,750.00 18,750.00 250,000.00 950,000.00 1.42 31-Dec-12 285,625.00 35,625.00 250,000.00 700,000.00 2.42 31-Dec-13 126,250.00 26,250.00 100,000.00 600,000.00 3.42 31-Dec-14 322,500.00 22,500.00 300,000.00 300,000.00 4.42 31-Dec-15 111,250.00 11,250.00 100,000.00 200,000.00 5.42 31-Dec-16 107,500.00 7,500.00 100,000.00 100,000.00 6.42 31-Dec-17 103,750.00 3,750.00 100,000.00 - 1,325,625.00 125,625.00 1,200,000.00 * Dates and rates are preliminary. Specifics will be set after the loan is authorized. The interest rate equals the current prime lending rate of 3.25% plus .5% Draft June 13, 2011 PROMISSORY NOTE $1,200,000 July ___, 2011 FOR VALUE RECEIVED, FCDM, Inc., (“Borrower”), promises to pay to the order of THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“Lender”), at its office at 300 LaPorte Avenue, Fort Collins, Colorado 80522, in lawful money of the United States of America the principal amount of One Million Two Hundred Thousand Dollars ($1,200,000). This Promissory Note is issued pursuant to the Loan and Security Agreement between the City of Fort Collins and FCDM, Inc. dated July ___, 2011. Capitalized terms used herein but not defined herein have the meanings given such terms in the Loan Agreement. The obligations of Borrower evidenced by this Promissory Note are payable in accordance with the terms and conditions of the Agreement. The rate of interest borne by this Promissory Note is a fixed rate equal to ________ % per annum (“Interest Rate”). Final payment of all unpaid Principal and accrued interest, plus any default interest, fees and charges owing under this Note, will be due and payable on December 31, 2017 (the “Maturity Date”). The annual interest rate of this Promissory Note is computed on a 360 day year basis, multiplied by the actual number of days elapsed. The Loan may be drawn 100% upon execution of the Loan Documents, or in part from time to time, but not more frequently than monthly. Unless otherwise agreed to or as may be required by applicable law, payments will be applied first to any accrued interest; then to principal; then to any late charges; and then to any unpaid collection costs. If Lender refers this Note to an attorney for collection or seeks legal advice following a default beyond all cure periods allowed under this Note, or the Lender is the prevailing party in any action instituted on this Note, or if any other judicial or non-judicial action, suit or proceeding is instituted by Lender or any future holder of this Note, and an attorney is employed by Lender to appear in any such action or proceeding, or to reclaim, seek relief from a judicial or statutory stay, sequester, protect, preserve or enforce Lender’s interest in this Note, the Loan Documents or any other security for this Note (including, but not limited to, proceedings under federal bankruptcy law or in connection with any state or federal tax lien), then Borrower promises to pay reasonable attorneys’ fees and reasonable costs and expenses incurred by Lender and/or its attorney in connection with the above-mentioned events. If not paid within ten (10) days after such fees become due and written demand for payment is made, such amount shall be due on demand or may be added to the principal, at the Lender’s discretion. If any payment or installment due under this Note is not paid when it becomes due and payable, Borrower recognizes that the Lender will incur extra expenses for both the administrative cost of handling delinquent payments and the cost of funds incurred by Lender after the due date. Therefore, Borrower shall, in such event, without further notice, and without prejudice to the right of Lender to collect any other amounts provided to be paid herein, including default interest or to declare a default hereunder, pay to Lender to cover such expenses {00584920 / 4} - 2 - incurred as a result of any installment payment due being not received within ten (10) days of its due date, a “late charge” of five percent (5%) of the amount of such delinquent payment. Except as otherwise provided herein, the Borrower waives presentment and demand for payment, notice of acceleration or of maturity, protest and notice of protest and nonpayment, bringing of suit and diligence in taking any action to collect sums owing hereunder and agrees that its liability on this Note shall not be affected by any release or change in any security for the payment of this Note or release of anyone liable hereunder. No extension of time for the payment of this Note, or any installment or other modification of the terms made by the Lender with any person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note of the Borrower, even provided the Borrower is a party to such agreement. In no event whatsoever shall the amount paid, or agreed to be paid, to the holder of this Note for the use, forbearance or retention of the money to be loaned hereunder (“Interest”) exceed the maximum amount permissible under applicable law. If the performance or fulfillment of any provision hereof or of any of the Loan Documents or any agreement between Borrower and the Lender of this Note shall result in Interest exceeding the limit for interest prescribed by law, then the amount of such Interest shall be reduced to such limit. If, from any circumstance whatsoever, the Lender of this Note should receive as Interest, an amount which would exceed the highest lawful rate, the amount which would be excessive Interest shall be applied to the reduction of the principal balance owing (or, at the option of the Lender, be paid over to Borrower) and not to the payment of Interest. If any provision hereof or any of the Loan Documents shall, for any reason and to any extent, be invalid or unenforceable, then the remainder of the document or instrument in which such provision is contained and any of the other Loan Documents shall not be affected thereby but instead shall be enforceable to the maximum extent permitted by law. Borrower and Lender hereby knowingly, voluntarily, and intentionally waive any rights they may have to a trial by jury in respect of any litigation based hereon or arising out of, under or in connection with this note or any course of conduct, course of dealing, statements (whether oral or written) or actions of the other party. This Promissory Note shall be construed in accordance with the laws of the State of Colorado. IN WITNESS WHEREOF, Borrower has duly executed this Promissory Note as of the day and year first above written. BORROWER: FCDM, Inc. By: Executive Director DATE: July 5, 2011 STAFF: Darin Atteberry Brian Janonis AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 28 SUBJECT Resolution 2011-057 Establishing a Process for Enhancing Communication Between the City Council and the Council- Appointed Platte River Power Authority Board Member. EXECUTIVE SUMMARY Each of the four member cities that established Platte River Power Authority (“PRPA”) has two representatives serving on the PRPA Board of Directors. One is the mayor, and the other is appointed by City Council. In May 2011, Council requested that a process be established to provide direction to the Council-appointed member of PRPA. This resolution establishes the process for the Council-appointed Board member to communicate with, and receive comments from, City Councilmembers. BACKGROUND / DISCUSSION PRPA was established by the cities of Fort Collins, Loveland, Longmont and Estes Park to be their wholesale power provider. The contract establishing PRPA requires each municipality to have two members on the board of directors of PRPA. One is the mayor, and the other is appointed by City Council. Historically, the Council-appointed Board member has been the Director of Utilities. The Director of Utilities reports to and receives direction from the City Manager. As the policy making body for the City, Councilmembers desire to provide comments regarding positions the non-mayoral PRPA Board member should take on particular PRPA agenda items. This resolution establishes a process, consistent with the City Charter, to have the Council-appointed Board member communicate with City Councilmembers and for Councilmembers to provide comments regarding particular PRPA agenda items. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. RESOLUTION 2011-057 OF THE COUNCIL OF THE CITY OF FORT COLLINS ESTABLISHING A PROCESS FOR ENHANCING COMMUNICATION BETWEEN THE COUNCIL AND THE COUNCIL-APPOINTED PLATTE RIVER POWER AUTHORITY BOARD MEMBER WHEREAS, the City is one of four municipalities that established the Platte River Power Authority (“PRPA”) in 1975 to generate and transmit electric energy to the four member municipalities; and WHEREAS, pursuant to the terms of an Organic Contract establishing PRPA, each member municipality is represented by two members on the board of directors of PRPA; and WHEREAS, one of the two members on the PRPA board of directors is the Mayor of each member municipality or the Mayor’s designee, and the other is a Council appointee who has judgment, experience, and expertise which make that person particularly qualified to serve as a director of an electric utility; and WHEREAS, historically, the City Council has generally appointed the Director of the City’s Utilities to fill the Council-appointed position because of the unique qualifications of that individual with regard to the operation of an electric utility; and WHEREAS, in keeping with the practice, the Council has recently re-affirmed the service of Brian Janonis, the current Director of Utilities, on the Board; and WHEREAS, the Council as the policy-making body of the City, is interested in providing substantive policy direction to the Council-appointed member of the PRPA board of directors, and to do so in a manner that is in keeping with Article II, Section 13 of the Charter, which requires that, except for purposes of inquiry, Council and its members deal with the administrative service of the city solely through the City Manager; and WHEREAS, staff has developed a recommended process for improving communications between the Council and its appointees to the PRPA Board consisting of the following: (1) the Council-appointed PRPA board member will notify Council of all PRPA board meeting agenda items as soon as those agenda items are placed on the agenda for a PRPA board meeting; and (2) Councilmembers will, at the Council work session immediately preceding the PRPA board meeting, offer any comments they may have regarding positions the non- mayoral PRPA board member should take on particular agenda items, and (3) following the PRPA board meeting, the Council-appointed board member will, through the City Manager, notify Council of the outcome of any vote taken at the PRPA board meeting on matters that were the subject of Councilmember comments, as well as any relevant substantive PRPA board discussion about such items. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Council hereby approves and adopts the above-described process for enhancing communications between the Council and the Council-appointed member to the PRPA Board. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 5th day of July A.D. 2011. Mayor ATTEST: City Clerk urban renewal authority Karen Weitkunat, President City Council Chambers Kelly Ohlson, Vice-President City Hall West Ben Manvel 300 LaPorte Avenue Lisa Poppaw Fort Collins, Colorado Aislinn Kottwitz Wade Troxell Gerry Horak Cablecast on City Cable Channel 14 on the Comcast cable system Darin Atteberry, Executive Director Steve Roy, City Attorney Wanda Krajicek, Secretary The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224-6001) for assistance. URBAN RENEWAL AUTHORITY MEETING July 5, 2011 (after the Regular Council Meeting) 1. Call Meeting to Order. 2. Roll Call. 3. Consideration and Approval of the Minutes of the June 7, 2011 Meeting. 4. Resolution No. 036 Authorizing the Chairperson to Enter into an Amendment to the Intergovernmental Agreement with the City of Fort Collins. (staff: Mike Freeman, Christina Vincent; no staff presentation; 5 minute discussion) At the June 7, 2011 Council meeting, Council requested that the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that whenever the City advances funds to the URA, a loan agreement and promissory note accompany the advance of funds. 5. Other Business. 6. Adjournment. DATE: July 5, 2011 STAFF: Wanda Krajicek AGENDA ITEM SUMMARY URBAN RENEWAL AUTHORITY 3 SUBJECT Consideration and Approval of the Minutes of the June 7, 2011 Meeting. June 7, 2011 URBAN RENEWAL AUTHORITY A regular meeting of the Urban Renewal Authority was held on Tuesday, June 7, 2011, at 9:55 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll Call was answered by the following Boardmembers: Horak, Manvel, Ohlson, Poppaw, Troxell, and Weitkunat. Staff Members Present: Atteberry, Krajicek, Roy. Vice-President Ohlson made a motion, seconded by Boardmember Troxell, to adopt the minutes of the May 17, 2011 meeting. Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Resolution No. 033 Approving a Loan From the City Of Fort Collins to the Fort Collins Urban Renewal Authority and Appropriating the Proceeds of that Loan for the Purpose of Funding Public Infrastructure Improvements for the Kaufman and Robinson, Inc. Project at 1330 Blue Spruce, Adopted The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY The Fort Collins Urban Renewal Authority (URA) is seeking a loan from the City to reimburse Kaufman and Robinson, Inc (KRI) for the public improvements associated with building a new location at 1330 Blue Spruce Drive. Offsetting these costs allowed the retention and expansion of a locally owned business to be economically feasible. The total cost of this Project was $192,891. The requested loan amount from the City of Fort Collins General Fund Reserves to the URA will be $192,891. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance funds to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission. 132 June 7, 2011 On June 2 2009, the URA Board approved a Redevelopment Agreement between the URA and KRI to provide financial assistance through reimbursement for a new building project at 1330 Blue Spruce Drive. The obligation was to reimburse up to $215,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. On December 1, 2009, the URA Board approved a revised Redevelopment Agreement between the URA and KRI to provide additional financial assistance through reimbursement for green building components added to the new building project at 1330 Blue Spruce Drive. The original obligation was to reimburse up to $215,000 and was increased by $54,000 for green building features, bringing the maximum amount to $269,000 upon issuance of a Certificate of Occupancy for the public improvements as stated in the Redevelopment Agreement. Exhibit C from the Redevelopment Agreement lists the public improvements included as total eligible costs (Attachment 1). Also attached is a list of eligible improvements based on receipts delivered to URA staff. The project did not utilize all the funds originally granted which leaves more unencumbered TIF for the plan area. The URA will see a savings of $76,109 back to the North College URA Plan area. See table 1 below to illustrate this point. Table 1 Amount Percent of TIF Total TIF the Project will generate $600,000 100% Total TIF awarded to Kaufman and Robinson $269,000 45% Total reimbursable expenses $192,891 32% Financing costs* $32,000 5% Total cost to URA $224,891 37% Total unencumbered funds for the plan area $375,109 63% *Financing costs are estimated until the rate is set the day after approval. FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $600,000. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board to Kaufman and Robinson. URA funding for the Project totals $192,891. As mentioned above, the URA will save funding on this project from original projections and allow more funding for plan area wide improvements. This loan is a five year term loan, with the first four years interest only payments and the remaining balance paid in year five.” 133 June 7, 2011 Boardmember Horak made a motion, seconded by Boardmember Troxell, to adopt Resolution No. 033. Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Resolution No. 034 Approving a Loan from of the City of Fort Collins to the Fort Collins Urban Renewal Authority and Appropriating the Proceeds of That Loan for the Purpose of Funding Public Infrastructure Improvements for the North College Marketplace Project, Adopted The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY The Urban Renewal Authority (URA) is seeking a loan in the amount of $3 million from the City to fulfill the remaining reimbursement obligation for the North College Marketplace granted by the URA Board in September 2008. The first appropriation for $5 million was received in April 2009 for Off Site Street Infrastructure, Wetlands Mitigation, and Demolition/Site Preparation. The requested loan amount from the City of Fort Collins’ General reserves to the URA will be $3 million and reimbursed to the project for the On-Site public improvements. The URA will utilize the City’s Interfund Borrowing program that was formally added to the City’s investment policies in 2008. This program enables the City to use a portion of its investment portfolio to assist City Departments and related entities (e.g., the URA) to access funds at a competitive interest rate while still providing a market based yield to the City investment portfolio. BACKGROUND / DISCUSSION The City and the URA entered into an intergovernmental agreement on August 15, 2006 allowing the City to advance fund to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission.” On September 16, 2008 the URA Board approved Resolution No. 011, authorizing a Redevelopment Agreement between the URA and the developer to provide financial assistance for the North College Marketplace. It was determined at that time that the URA would need to borrow the funds to pay for the public improvements and then bond against that amount in the future. The City loaned the URA funds in the amount of $5 million on April 21, 2009 for those public improvements associated with the first three line items of Exhibit C of the Redevelopment Agreement (attached). Below are the line items listed in Exhibit C for the initial appropriation of $5 million: 134 June 7, 2011 *Off Site Street Infrastructure $ 2,812,620 *Demolition, Property Clean up and Site Preparation Cost $ 366,650 *Wetlands Mitigation, Landscaping, Unsuitable Materials and Payment to the Wetlands’ Reserve Fund $ 1,763,206 *Contingency (initial amount) $ 57,524 $ 5,000,000 The remaining line items listed in Exhibit C are requested for this appropriation of $3 million: *On Site Utilities (Sanitary, Storm, Water, Dry) $1,022,861 *Gateway/Landscaping/Pedestrian Connection/Grading/ North South Circulation and College Avenue Public Access Easement/Paving of Grape Street $1,702,128 *Relocation Assistance (Up to 1,000 per residence) $ 10,000 *Contingency (remaining) $ 265,011 $3,000,000 Exhibit C from the Redevelopment Agreement lists the public improvements included as potential eligible costs. FINANCIAL / ECONOMIC IMPACTS The Project was determined by the URA Board to be a qualified project for tax increment financing and consistent with the North College URA Plan as well as the North College Corridor Plan. Over the remaining life of the plan area, the project will generate an estimated $15.5 million in property tax increment. This action approves the loan agreement between the City and URA to finance the commitment made by the URA Board for the North College Marketplace. URA funding for the Project’s second appropriation amount totals $3,000,000. This loan is a 20- year term loan. “ Boardmember Horak made a motion, seconded by Boardmember Troxell, to adopt Resolution No. 034 as amended. Boardmember Manvel asked if the URA adopting this Resolution would be affected by the outcome of the source of funds discussion to be had prior to Second Reading before Council. Staff replied in the affirmative. Boardmember Manvel made a friendly amendment to remove the reference to General Fund in the Resolution. Boardmembers Horak and Troxell accepted the amendment. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. 135 June 7, 2011 Resolution No. 035 Approving an Agreement to Repay the City of Fort Collins $2.7 Million to Help Defray the Cost of Constructing Public Improvements for the North College Avenue Improvements - Vine Drive to Conifer Project, Adopted The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY This Resolution authorizes the Executive Director of the Fort Collins Urban Renewal Authority (URA) to negotiate and execute a reimbursement agreement and promissory note with the City of Fort Collins. The proposed agreement authorizes the URA to reimburse funds in the amount of $2,700,000 for the design, installation, construction and financing of a two inch asphalt overlay, the construction of various urban design elements, an eight foot on-street bike lane, a landscaped parkway, shared use paths, the definition and consolidation of property access routes for local business throughout the corridor, an updated storm system including water quality treatment ponds, and safety improvements at the Conifer and Hickory Intersection. The payment obligation will be interest only for two years followed by annual interest and principal payment s until December 31, 2029. The estimated financing cost associated with the reimbursement is $1,144,338. BACKGROUND / DISCUSSION North College Avenue, also known as US Highway 287, is a major north-south four lane arterial that runs through north Fort Collins, providing both local and regional connectivity. Through previous planning efforts, staff identified the need to enhance the northern gateway to the city, improve multimodal travel while accommodating the large volume of interstate truck traffic, and to address aging utility infrastructure and drainage issues. There was also a desire to establish a strong connection between the growing North College corridor and the rest of the community, in particular, the historic Old Town area as well as the locally and regionally significant Poudre River bicycle/pedestrian trail. North College Avenue between Vine Drive and the Conifer/Hickory intersection is heavily traveled, lacks multimodal improvements, has poorly defined access points to existing businesses, and lacks even minimal urban design features to beautify the corridor. Previous projects have begun to address the deficiencies along the corridor through the construction of multimodal improvements, access consolidation/definition, various utility upgrades, and the installation of urban design elements. This project continues these efforts by connecting to the southern terminus of the Phase I North College Improvement Project constructed in 2004 and 2005. Phase I improvements spanned from Jefferson Street to Vine Drive. Goals for the roadway and streetscape improvements along North College Avenue between Vine Drive and Conifer Street include the following: • Create a safe and effective travel corridor for all users including bicycles, pedestrians, transit users, passenger vehicles, and heavy vehicles 136 June 7, 2011 • Define access points as highlighted in the US 287/SH14 Access Management Report • Maintain compatibility with utilities, including stormwater, water, sewer, power, and communications • Support the economic viability of the project area • Upgrade the image of the North College Corridor while minimizing impacts to existing infrastructure • Maintain compatibility with the intent of previous local planning efforts All of the planned improvements along North College Avenue will be designed and constructed in accordance with previous planning efforts, the Colorado Department of Transportation’s guidelines and specifications, current utility and floodplain regulations, and the US 287/SH14 Access Management Report’s short term goals. Medians and side street connections will not be constructed as part of this project as they are anticipated to be built concurrent with redevelopment activity in the area. Construction is planned to begin fall of 2011, focusing on utility improvements. Roadway construction is planned to begin early spring of 2012 and be completed by the end of 2012. FINANCIAL / ECONOMIC IMPACTS Financial Impact The funds from the City pursuant to the repayment agreement and supporting promissory note will be for a 17.5 year term at approximately 3.92 percent interest (the 20-year Treasury Bill rate on June 7, 2011). The estimated financing cost to the URA is approximately $1.1 million based on the term and interest rate. Interest will begin accruing when funds are disbursed, currently anticipated in mid-year 2012 (based on the anticipated construction schedule). There is no impact to the City's General Fund or General Fund reserves. However, this financial commitment will consume $3.8 million in unencumbered Tax Increment ($2.7 million principal and $1.1 million interest) generated by projects in the North College Urban Renewal Plan (NCURP). These funds might otherwise be spent on capital projects in the NCURP area. In addition, the principal and interest will impact the cash flow of the NCURP. This may adversely impact the ability to refinance the NCURP's current debt into the private sector. Staff has been actively analyzing this opportunity. Preliminary estimates indicate that this additional loan may delay the possibility of the URA borrowing from the market by 1 to 2 years. Economic Impact One of the primary goals of this project is to support the economic viability of the project area by upgrading the image and safety of the North College Corridor, while minimizing impacts to existing infrastructure. This is consistent with adopted long-term plans for the area, including the North College Corridor Plan (2007), Fort Collins’ City Plan (2011), and the North College Urban Renewal Plan. The project will address these goals through the construction of multimodal improvements, urban design features, the consolidation and definition of accesses, and other improvements which target and encourage redevelopment. The completion of these improvements will provide an economic benefit to the North College area as well as to the City of Fort Collins as a whole with increased property values and sales tax collection. 137 June 7, 2011 ENVIRONMENTAL IMPACTS The project will have a positive impact on long-term air and storm water quality. The addition of improved bicycle and pedestrian facilities will increase the number of people walking and biking along North College Avenue, resulting in improved air quality. The utility upgrades in this project include improvements to stormwater quality with the installation of water quality ponds to remove suspended solids and hydrocarbon contaminants from roadway drainage prior to discharge into receiving waters. “ Boardmember Manvel made a motion, seconded by Boardmember Horak, to adopt Resolution No. 035. Yeas: Weitkunat, Manvel, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Adjournment The meeting adjourned at 10:00 p.m. _________________________________ Mayor, Ex Officio President ATTEST: _____________________________ City Clerk, Ex Officio Secretary 138 DATE: July 5, 2011 STAFF: Mike Freeman Christina Vincent AGENDA ITEM SUMMARY URBAN RENEWAL AUTHORITY 4 SUBJECT Resolution No. 036 Authorizing the Chairperson to Enter into an Amendment to the Intergovernmental Agreement with the City of Fort Collins. EXECUTIVE SUMMARY At the June 7, 2011 Council meeting, Council requested that the Urban Renewal Authority (URA) Board modify the Intergovernmental Agreement (IGA) between the City and the URA to formalize the requirement that whenever the City advances funds to the URA, a loan agreement and promissory note accompany the advance of funds. BACKGROUND / DISCUSSION Council would like to formalize the process for loaning funds to the URA based on approved projects and eligible costs associated with the development. The URA continues to need funding from the City for projects until such time that the URA can obtain private financing with proven revenue streams sufficient to pay higher interest rates on its loans. The City wants to ensure the funding is appropriately dedicated to a project with a loan agreement and promissory note in place. FINANCIAL / ECONOMIC IMPACTS The URA will need to ensure that sufficient revenues exist to pay back any loans requested of the City. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. ATTACHMENTS 1. Existing IGA between the City and the URA 1 INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND THE FORT COLLINS URBAN RENEWAL AUTHORITY THIS AGREEMENT (“Agreement”) is entered into this ________ day of _______________, 2006, by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation (hereinafter the “City”) and the FORT COLLINS URBAN RENEWAL AUTHORITY, a body corporate and politic in the State of Colorado (hereinafter the “URA”), collectively referred to herein as the “Parties.” RECITALS WHEREAS, the City is a home-rule city and a municipal corporation duly organized and existing under and pursuant to Article XX of the Colorado Constitution and the Charter of the City (the "Charter"); and WHEREAS, the URA is a body corporate and has been duly created, organized, established and authorized by the City to transact business and exercise its powers as an urban renewal authority, all under and pursuant to the Colorado Urban Renewal Law, Section 31-25-101, et seq., Colorado Revised Statutes (the "Act"); and WHEREAS, pursuant to Sections 31-25-107 and 31-25-109 of the Act, the URA has the power and authority to issue or incur notes, interim certificates or receipts, temporary bonds, certificates of indebtedness, debentures, advances, or other obligations, including refunding obligations (collectively, the "Bonds"), for the purpose of financing the activities and operations authorized to be undertaken by the URA with respect to urban redevelopment projects in ac- cordance with an urban renewal plan and the Act, as approved by the City; and WHEREAS, both the Act and Section 18, Article XIV, of the Colorado Constitution authorize the City and the URA to enter into cooperative agreements, such as this Intergovernmental Agreement. WHEREAS, the City and the URA have determined that, for purposes of economy and efficiency of operation, it is in the best interests of the public that the operating staff and resources of the URA be provided by the City, subject to the terms and conditions of this Intergovernmental Agreement (hereinafter referred to as the “Agreement”); and WHEREAS, the City and the URA wish to express their mutual agreement on these matters as more fully set forth herein, and are authorized to enter into this Agreement pursuant to § 31-15-101 and § 31-25-105, C.R.S., respectively. NOW, THEREFORE, it is agreed by the parties as follows: 2 TERMS AND CONDITIONS 1. Definitions The terms used in this Intergovernmental Agreement shall have the meanings set forth in the Act. In addition, for the purposes of this Intergovernmental Agreement, the following terms shall have the meanings set forth below. "Fiscal Year" shall mean the fiscal year of the City, which commences on January 1 of each calendar year and ends on December 31 of the same calendar year. "Incremental Property Taxes" shall mean, for each Fiscal Year subsequent to the creation of any urban renewal area, all Property Tax Revenues in excess of the Property Tax Base Amount for the Urban Renewal Plan Area. "Property Tax" shall mean the real and personal property taxes produced by the levy at the rate fixed each year by the governing bodies of the various taxing jurisdictions within or overlapping the Urban Renewal Plan Area. "Property Tax Base Amount" shall mean the total valuation for assessment as certified by the County Assessor for the City of all taxable property within an Urban Renewal Plan Area as certified by the County Assessor for the City prior to the creation of such area. "Property Tax Revenues" shall mean the amount derived from the levy of Property Tax within any Urban Renewal Plan Area. “Urban Renewal Plan Area” shall mean a slum area, or a blighted area, or a combination thereof which the City Council designates as appropriate for an urban renewal project. 2. URA Employees Provided by City A. The City agrees to provide City staff, including but not limited to staff of the City Manager’s Office, Community Planning and Environmental Services, and Finance Department, and other employees, consultants, and staff (hereinafter collectively referred to as “City Staff”) to the URA on an as-needed basis for the operation and management of URA activities subject to the URA’s reimbursement to the City as provided in Section 5. The City Manager shall serve as the Executive Director of the URA. The City Attorney’s Office shall provide legal services to the URA, with the assistance of such special legal counsel as may be authorized by the City Attorney, as long as the members of the City Council continue to serve ex officio as the members of the URA Board of Commissioners. B. City staff time spent on URA activities shall be separately recorded and specifically documented for purposes of determining the appropriate reimbursement to the City in accordance with Section 5. It is the intention of the parties that the services performed by such employees on behalf of the URA shall not interfere with the ability of such employees to carry out their duties and responsibilities for the City. 3 3. Other Services In addition to providing staff employees for the URA, the City agrees to provide the URA with such other services as may be required in order to perform its public functions, including, but not limited to, accounting, treasury, management, procurement, personnel services, engineering services, and planning services, and other consultant services, provided however, that nothing herein shall be construed as prohibiting the URA from contracting with third parties to provide all or a portion of such services. It is the intention of the parties that the URA’s annual or any special financial audits shall be performed by an independent auditor. All costs of any such audit or financial services shall be paid by the City, subject to reimbursement by the URA as provided in Section 5 below. 4. Office Space; Furnishings; Equipment City staff working on behalf of the URA is authorized to utilize City office space, furnishings and equipment, including telephones, fax machines, printers, photocopiers, computers, office supplies and similar equipment, to carry out URA business. A prorated share of the expenses associated with use of such office space, furnishings and equipment shall be charged back to the URA in accordance with Section 5 below. As needed, the City may make available office space to the URA, as provided under any such lease agreements as may be agreed upon by the City and the URA. 5. City Compensation At such time as the City Council determines that the URA has sufficient funding source(s), the URA shall compensate the City for all or a portion of the costs reasonably incurred by the City in providing City Staff, services, office space, furnishings and equipment described herein. The City shall submit to the URA, at such times in the future as the City deems appropriate, one or more invoices detailing the specific services rendered and other expenses incurred by the City on behalf of the URA a specific time period stated in such invoice(s). Such invoices shall be in sufficient detail and shall include salaries, benefits, insurance and other costs incurred by the City, on a prorated basis, and shall sufficiently designate the type of service performed by the City so that the URA may properly determine the accuracy of the invoices. Unless the URA objects to an invoice within ten (10) days of the date of the invoice, the URA shall be deemed to approve such invoice for payment to the City and shall make payment to the City within a reasonable time and as funding of the URA is available. 6. City Advance of Funds If requested by the URA, the City may, from time to time, advance funds to the URA in support of its activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission. 7. Legal Entity, Ethical Rules, Bylaws The URA constitutes a separate body corporate and politic as established under the statutes of the State of Colorado, and the URA Commission shall expeditiously adopt a set of Bylaws for the purpose of governing the officers and staff, meetings, ethical rules, and powers of the URA Commission. The ethical rules of the URA Commission shall be the same as those 4 which are applicable to the City Council, as long as the City Council is functioning as the URA Board of Commissioners. The URA shall comply with then current City policies regarding purchasing and expenditure of funds. 8. Sales Tax Increment It is agreed between the City and the URA that all City sales taxes collected in any urban renewal area of the URA shall accrue to the City until such time, if at all, that the City Council, in its sole discretion, decides to include in an urban renewal plan a provision allocating a portion of said sales tax revenues to the Authority for the purpose of funding URA projects within a particular urban renewal area. 9. Property Tax Increment The City agrees to assist the URA in pursuing its objectives and purposes, including, without limitation, any specific purposes established for a particular urban renewal area, by collecting and paying into a special fund of the URA the Incremental Property Taxes received by the City for each urban renewal area, for the purpose of paying the principal of, the interest on and any premiums due in connection with the bonds of, loans or advances to or other indebtedness incurred by the URA for financing or refinancing urban renewal projects within such area. In the event that the City is unable to collect through lawful means any Property Tax Revenues due for any urban renewal area, the amount of uncollectible Property Tax Revenues shall be allocated between the URA and the City for the urban renewal area in the same proportion as the total collected Property Tax Revenues within such area are allocated between the City and the URA for such Fiscal Year. The Property Tax Increment shall be calculated in accordance with Colorado law, the applicable urban renewal plan, and this Intergovernmental Agreement. 10. Insurance The URA may provide its own public liability insurance and other insurance provided, however, that the City and the URA agree to consider the desirability of including the URA within the City’s existing liability insurance coverages as a part of the services to be provided by the City to the URA subject to reimbursement of any additional cost to the City as provided in Section 5 above. 11. Responsibility of URA Nothing in this Agreement shall be interpreted in any manner as constituting the City as the agent of the URA or the URA as the Agent of the City. Each party shall remain separate and neither shall hereby assume the debts or obligations of the other. The URA shall be solely responsible for carrying out its duties and functions in accordance with the Colorado Urban Renewal Law and other applicable laws and regulations. 12. Termination This Agreement may be terminated by the mutual consent of the parties at any time after giving at least thirty (30) days written notice of intention to terminate the Agreement. 5 13. Binding Agreements This Agreement represents the total binding Agreement between the parties and replaces and supercedes any prior oral or written agreement between the City and the URA. 14. Governing Law This Agreement shall be governed by, and construed in accordance with the laws of the State of Colorado. 15. Severability If any covenant, term, condition, or provision under this Agreement shall, for any reason, be held to be invalid or unenforceable, the invalidity or unenforceability of such covenant, term, condition, or provision shall not affect any other provision contained herein, the intention being that such provisions are severable. 16. No Third Party Beneficiaries Nothing expressed or implied in this Agreement is intended or shall be construed to confer upon, or to give to, any person other than the City and the URA any right, remedy, or claim under or by reason of this Agreement or any covenants, terms, conditions, or provisions thereof, and all the covenants, terms, conditions, and provisions in this Agreement by and on behalf of the Parties shall be for the sole and exclusive benefit of the Parties. 17. No Waiver of Governmental Immunity Nothing in this Agreement shall be construed to waive, limit, or otherwise modify any governmental immunity that may be available by law to the City or to the URA, their officials, employees, contractors, or agents, or any other person acting on behalf of the City or the URA and, in particular, governmental immunity afforded or available pursuant to the Colorado Governmental Immunity Act, Title 24, Article 10, Part 1 of the Colorado Revised Statutes. CITY OF FORT COLLINS, COLORADO By: Douglas P. Hutchinson, Mayor ATTEST: APPROVED AS TO FORM: By: By: Wanda Krajiceck, City Clerk City Attorney 6 FORT COLLINS URBAN RENEWAL AUTHORITY By ______________________________ Douglas P. Hutchinson, Chairperson ATTEST: APPROVED AS TO FORM: By: By: URA Secretary URA Attorney RESOLUTION NO. 036 OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY AUTHORIZING THE CHAIRPERSON TO ENTER INTO AN AMENDMENT TO THE INTERGOVERNMENTAL AGREEMENT WITH THE CITY OF FORT COLLINS WHEREAS, on February 21, 2006, the Board of Commissioners of the Fort Collins Urban Renewal Authority (the “Board”) adopted a resolution establishing an ad hoc committee for the purpose of formulating recommendations regarding the administration of the Urban Renewal Authority (the “URA”); and WHEREAS, one of the recommendations of the ad hoc committee and City staff was that a general "umbrella" intergovernmental agreement be entered into between the City and the URA governing a number of topics; and WHEREAS, on August 15, 2006, the Board adopted Resolution 005 authorizing the Chairperson to enter into such intergovernmental agreement with the City (the “IGA”); and WHEREAS, Section 6 of the IGA states that the City may advance funds to the URA in support of its activities so long as the advance of funds is evidenced in writing through a promissory note or a grant; and WHEREAS, City Council believes that the IGA should more clearly state that any and all advances of funds that the City makes to the URA should be evidenced by a promissory note and related agreement, regardless of the circumstances under which such advances are made; and WHEREAS, staff has prepared a proposed amendment to the URA IGA (the “Amendment”) a copy of which is attached hereto as Exhibit “A” and incorporated herein by this reference; and WHEREAS, the Board has determined that the Amendment is in the best interests of the URA and should be entered into between the URA and the City. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY that the Chairperson is hereby authorized to execute the proposed amendment to the intergovernmental agreement between the URA and the City. Passed and adopted at a regular meeting of the Board of Commissioners of the Fort Collins Urban Renewal Authority this 5th day of July, A.D. 2011. _________________________________ Chairperson ATTEST: __________________________________ Secretary FIRST ADDENDUM TO THE INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO AND THE FORT COLLINS URBAN RENEWAL AUTHORITY REGARDING OPERATING STAFF AND RESOURCES THIS ADDENDUM is made and entered into by and between THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (the “City”), and THE FORT COLLINS URBAN RENEWAL AUTHORITY, a political subdivision of the State of Colorado (the “URA”), and shall be effective on the date signed by the City. WHEREAS, the City and URA have previously entered into that certain Intergovernmental Agreement dated August 15, 2006 (the “Agreement”); and WHEREAS, the City and the URA desire to continue their arrangement of sharing operating staff and resources to maintain economy and efficiency of operations; and WHEREAS, the City and the URA wish to amend the Agreement to clarify the advancement of funds under the Agreement; and WHEREAS, the parties are authorized to enter into intergovernmental agreements to provide any function, service or facility as provided in Article II, Section 16 of the Charter of the City of Fort Collins and Section 29‐1‐203, C.R.S. NOW, THEREFORE, in consideration of mutual promises and covenants and other good and valuable consideration, the receipt and adequacy of which are acknowledged, the parties agree to amend the terms and conditions of the Agreement as follows: 1. That Section 6 of the Agreement is modified to read: The City may, in the sole discretion of the City Council, advance funds to the URA in support of the URA’s activities. Any such advance of funds shall be evidenced in writing in the form of a loan memorialized by a promissory note or a grant, which transaction shall not be valid until first having been approved by both the City Council and the URA Commission. 2. All other terms and conditions of the Agreement shall remain unchanged and in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this First Addendum to the Intergovernmental Agreement between the City of Fort Collins, Colorado and the Fort Collins Urban Renewal Authority Regarding Operating Staff and Resources to be executed. For the City: THE CITY OF FORT COLLINS A Municipal Corporation By: ____________________________________ Karen Weitkunat, Mayor ATTEST: Approved as to legal form: _____________________________ City Clerk ________________________ Assistant City Attorney For the URA: THE FORT COLLINS URBAN RENEWAL AUTHORITY A political subdivision of the State of Colorado By: ____________________________________ Karen Weitkunat, Chairperson ATTEST: Approved as to legal form: _____________________________ Secretary ________________________ Authority Attorney Karen Weitkunat, Mayor Council Information Center Kelly Ohlson, District 5, Mayor Pro Tem City Hall West Ben Manvel, District 1 300 LaPorte Avenue Lisa Poppaw, District 2 Fort Collins, Colorado Aislinn Kottwitz, District 3 Wade Troxell, District 4 Cablecast on City Cable Channel 14 Gerry Horak, District 6 on the Comcast cable system Darin Atteberry, City Manager Steve Roy, City Attorney Wanda Krajicek, City Clerk The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224- 6001) for assistance. WORK SESSION July 5, 2011 After the Urban Renewal Authority Meeting 1. Call Meeting to Order. 2. Modernizing Water and Electric Infrastructure. (staff: Brian Janonis, Steve Catanach, Kraig Bader; 90 minute discussion) The objective of this work session item is to provide City Council with an update on the Advanced Meter Fort Collins project. The project involves the upgrade of all of the electrical and water meters within the City utilities service territories. The project will improve current operations within Utilities, help meet the goals established in the Energy Policy, enhance our ability to serve customers, and ensure that Utilities is well positioned to support the current evolution of the traditional electric utility. The opportunities available to customers surrounding involve their energy choices are growing. Looking towards the future, industry predictions suggest that the life-cycle cost of installing solar panels will be the same as, or less than, electrical prices from the utility within the decade. In addition, consumers have expressed a strong interest in the adoption of electric vehicles. In response, manufacturers are investing heavily in the development of electric vehicles; there are currently 34 all-electric vehicle manufacturers in the United States. A recent report from the Department of Energy addressing the progress toward the President’s goal of “One Million Electric Vehicles By 2015” indicates that the manufacturing capability already exists and the next necessary step is educating and supporting the consumer. The installation of advanced metering technology provides a foundation that will enable Fort Collins Light & Power to support, inform and empower our community by providing energy choices while maintaining the same level of quality service and high reliability provided to customers today. The key benefits defined include: • use information and technology to maintain high system reliability • make utility operations even more cost-effective • provide more timely customer service • prepare the utility and the community for emerging technologies. 3. Other Business. 4. Adjournment. DATE: July 5, 2011 STAFF: Brian Janonis, Steve Catanach, Kraig Bader Pre-taped staff presentation: available at fcgov.com/clerk/agendas.php WORK SESSION ITEM FORT COLLINS CITY COUNCIL SUBJECT FOR DISCUSSION Modernizing Water and Electric Infrastructure. EXECUTIVE SUMMARY The objective of this work session item is to provide City Council with an update on the Advanced Meter Fort Collins project. The project involves the upgrade of all of the electrical and water meters within the City utilities service territories. The project will improve current operations within Utilities, help meet the goals established in the Energy Policy, enhance our ability to serve customers, and ensure that Utilities is well positioned to support the current evolution of the traditional electric utility. The opportunities available to customers surrounding involve their energy choices are growing. Looking towards the future, industry predictions suggest that the life-cycle cost of installing solar panels will be the same as, or less than, electrical prices from the utility within the decade. In addition, consumers have expressed a strong interest in the adoption of electric vehicles. In response, manufacturers are investing heavily in the development of electric vehicles; there are currently 34 all-electric vehicle manufacturers in the United States. A recent report from the Department of Energy addressing the progress toward the President’s goal of “One Million Electric Vehicles By 2015” indicates that the manufacturing capability already exists and the next necessary step is educating and supporting the consumer. The installation of advanced metering technology provides a foundation that will enable Fort Collins Light & Power to support, inform and empower our community by providing energy choices while maintaining the same level of quality service and high reliability provided to customers today. The key benefits defined include: • use information and technology to maintain high system reliability • make utility operations even more cost-effective • provide more timely customer service • prepare the utility and the community for emerging technologies. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED Utilities is providing several options for customers. • Option 1: Standard mode with full functionality • Option 2: Limited mode collects data only once per day • Option 3: Manual mode: meter read manually once per month (added monthly cost) July 5, 2011 Page 2 The table below summarizes the features. 1. Is Council comfortable with the options? 2. The technology that has been selected for the AMI communication system is expandable. It will provide an opportunity to support current, future and new applications within Utilities, the City and the community. Should staff pursue opportunities within the City and community and bring back to Council? BACKGROUND / DISCUSSION In 2008, the City adopted the Climate Action Plan. One of the strategies identified in the Plan included the installation of Advanced Meters to provide customers with information on their energy usage. Starting in January 2009, Utilities staff worked in cooperation with R.W. Beck to develop a business case for the installation of an Advanced Metering Infrastructure (AMI) system for both the water and electrical systems. The business case analysis supported the decision to move forward with installation of the system. As Utilities moved the budget offer through the Budgeting For Outcomes (BFO) process, the availability of American Recovery and Reinvestment Act (ARRA) funding for grid modernization projects was announced. In addition to the AMI system, Utilities reviewed the Utilities Long Range Information Technology Plan for projects that would be applicable to the ARRA grants funded by the Department of Energy (DOE). The grant application requested funding for the electrical AMI system infrastructure improvements to support the system such as installation of additional fiber optics, cyber security improvements, grid modernization equipment and, in support of the Climate Action Plan goals, a greatly enhanced demand response program. The total program proposed for funding the Smart Grid Investment Grant program for the electrical system was approximately $32 million. In October 2009, Utilities was notified it had been awarded a matching grant of $15.7 million. Considerations Option 1 Standard Option 2 Limited Option 3 Manual Functionality and ability to take advantage of new technology; allows full customer benefits High Limited Minimal Data collected in 15-minute to one-hour intervals 9 Data collected once per day 9 Data collected once per month via manual read 9 Data transmitted 4 to 6 times per day via a 1.5 second signal 9 9 Additional customer cost 9 9 Additional system cost 9 Requires monthly service call 9 Ability to support Energy Policy High Limited Minimal Optional July 5, 2011 Page 3 In April and May of 2010, Council approved both the appropriation and the sale of bonds in order to providing matching funds for the Smart Grid Investment Grant (SGIG) awarded to the City from the Department of Energy and for the installation of the AMI system. In July 2010, Council approved the appropriation of funds for water meters. The Advanced Meter Fort Collins program (AMFC) includes citywide deployment of advanced metering infrastructure (AMI), which will provide two-way communication between the Utility and the electrical and water meters and from the meters to customers. The information collected can then be shared with the customers by a web portal or other device, allowing them to make more informed decisions on how they use energy and water. As noted, the AMFC program also includes: • The installation of approximately 5 remotely operated high voltage switches. This gives Light & Power the opportunity to gain experience in developing the appropriate safety regulations, standards, process and procedures related to the automation of the distribution system. • Installation of additional fiber optic cable in order to connect the new Portner and Timberline Substations. • The development of Cyber Security guidelines consistent with the National Institute of Standards (NIST), standard 800-53. The NIST standards provide a roadmap for the development of policies and procedures that are best practices in the management of computer systems. • The expansion of the existing demand response and energy efficiency programs. The City’s current Energy Policy and the Climate Action Plan establish goals that are directly served by the AMFC project – high reliability and reduction of carbon footprint, as detailed below. Goal #1: Provide highly reliable electric service. The bullets below are a truncated list of the Objective and Metrics defined in the Energy Policy for Goal #1 that are supported by the AMFC program. • Demonstrate and communicate the high reliability of the Fort Collins electric system by maintaining annual reliability metrics of: N Average System Availability Index (ASAI) greater than 99.9886%; N Customer Average Interruption Index (CAIDI) less than 60 minutes; and N System Average Interruption Frequency Index (SAIFI) less than 1.0. • Manage peak loads to reduce demands on the distribution system, optimize infrastructure investment and reduce purchased power costs. N Maintain energy efficiency and demand side management programs targeting peak loads. N Increase the power managed by load management, smart grid and distributed generation to at least 5% of 2005 system peak demand by 2015 and at least 10% by July 5, 2011 Page 4 2020. Develop a methodology for tracking load management as a percentage of peak demand, considering utility programs, customer response and weather normalization. N Support customer efforts to reduce electric costs through managing peak loads. Goal #2: Support the community’s carbon emissions goal of reducing the City’s carbon footprint 20% below 2005 levels by 2020 and 80% by 2050. The bullets below are a truncated list of the Objective and Metrics defined in the policy for Goal #2 that are supported by the AMFC program. • Continuously reduce energy use through verifiable energy efficiency programs, independent of population growth and economic trends. N Achieve annual energy efficiency and conservation program savings of at least 1.5% of annual energy use (based on a three year average history). • For renewable energy resource investments, balance the interrelated factors of carbon reduction, cost-effectiveness, impact on power plant operations, and local economic benefits. N Maintain a minimum fraction of renewable energy in compliance with State of Colorado requirements. In coordination with Platte River Power Authority, develop generation resources and the delivery of renewable energy to meet minimum requirements. N Offer voluntary renewable energy programs whereby customers can support renewable energy and local renewable energy projects through opt-in premium pricing. N Increase the contribution of renewable energy to reach the 20% by 2020 carbon reduction goal, after accounting for the contributions of resource mix, energy efficiency, conservation, minimum renewable energy requirements and voluntary renewable energy programs. N Include renewable energy sources that can be scheduled to maintain system stability and reliability. The AMFC program provides support for the cited goals in several ways as described below. Background on the AMI System and Operation The AMI system that will be installed is fundamentally similar to the network communication systems that are installed in homes and businesses across the community. The network provides and exchanges information through local area networks (LAN) which are analogous to the wireless networks in most of our homes. The LAN then connects to a service provider through a Wide Area Network (WAN), which is the high capacity, high-speed collector. The WAN is typically a high- speed broadband connection provided to homes through the cable, phone or other providers. In the case of the AMI system, the LAN is a Neighborhood Local Area Network (NLAN), providing communications with the meter. The WAN is a Distribution Wide Area Network (DWAN) that carries the information to the Utilities’ “back-office” systems, such as the Meter Data Management System (MDMS), Customer Information System (CIS), Billing System, Outage Management System (OMS), etc. July 5, 2011 Page 5 How does this relate to achieving the City’s energy policy goals and how it currently operates? Today, the information we have relative to the operation of our electrical system is mathematically modeled. We have very detailed information about electrical demand at our electrical substations. Unfortunately, with today’s technology, that is where it stops. Both the design and operation of our electric distribution system are based on a worse-case scenario. The integration of the communications and metering system provides detailed information about the operation of the utility. Looking forward towards the evolution of the electrical system, the installation of large amounts of solar panels on homes and businesses, the purchases of more and more electric vehicles, and the information and communication desires of our customers, the information provided by the AMI meters becomes critical in the service to our customers and the operation of the electrical system. As with the electrical system, the information provided to both the Utilities and customer relative to water usage will be valuable. The system will provide an opportunity to better model the water system operations by providing a clearer picture related to system losses through leaks. Today there is no clear data that supports how much water might be lost on the system. The measurement of water delivered takes approximately 30 days for all the meters to be read. This does not provide a way to balance production with delivery. AMI will provide an opportunity to compare the output of the plant to the water being consumed at a relative window in time. In other words, the amount of water leaving the plant at midnight can be compared to the amount of water being delivered at midnight. The additional data can then be used to model the system better and identify losses. The customer benefit is more timely information on water use over the course of the billing period which allows them to make informed decisions on their use. Meeting the Reliability Goal The electric delivery system has been designed as a one-way delivery system. Historically, power is generated at a central plant, such as Platte River Power Authority’s Rawhide Plant. That energy is then transmitted over high voltage power lines to local distribution utilities. Voltage can be thought of as pressure in a water line. In order to move the energy greater distances the pressure, or voltage, is increased. The distribution utility transforms the high voltage power to a medium voltage more suitable for delivery through a community. The distribution utility then reduces the voltage again for delivery into the home. Using the pressure analogy, the pressure is again reduced to a more suitable level for the home or business. Note, the generation and transmission systems across the western U.S. are interconnected, which supports highly reliable delivery from the transmission system. In similar fashion to the transmission system, circuits in our electric distribution system are designed to be interconnected to reduce the impact of outages on our customers. This interconnected system is typically referred to as the grid. Today, when there is a problem on the distribution system the utility relies on customers to call in to report that they have no power. The integration of a communications system on top of the delivery system will provide immediate information that an outage has occurred and will give us information on where the problem may be. The new electric meters have a function called a “last- gasp”. This “last-gasp” is sent as a high priority message to the utility indicating power is out. Rather than waiting on a phone call, the utility will immediately know there is a problem. July 5, 2011 Page 6 In addition to the automated notification system, Light & Power will be installing devices called fault indicators. Using the water analogy, a fault is like “a break in the line”. A fault indicator is a device which provides a visual or remote indication that a fault has passed a particular point in the electric power system. Fault indicators help reduce the outage duration because they help to “narrow down” the possible locations of a fault. By using fault indicators, the line crews no longer have to “guess” where the fault may be. Today we have fault indicators throughout the system, but they do not communicate back to the utility. Line crews must drive to strategically selected points along the circuit and open vaults containing fault indicators to see if the fault has passed through that vault. The fault indicators proposed for this project will communicate via the enhanced communications network to report to the utility. The AMFC project will strategically place additional devices on the system allowing communications from the fault indicators to our System Control and Operations (SCO) center helping them dispatch crews to the suspected problem site more quickly. The network communications system being installed as part of the AMI system provides a foundation technology that will help achieve the goals of the energy policy. The enhanced communication system will help us maintain the high level of reliability and lower the length of outage time. Managing Peak Loads to Reduce System Peak A significant component of the AMFC program is the adoption of technologies to help reduce system peak demands. Electric power demand is measured in watts and is more commonly discussed using the terms kilowatt (1000 watts = 1 kilowatt, or 1kW) or megawatt (1,000,000 watts = 1 megawatt, or 1 MW). A peak demand is the maximum level of power required over a given period. An analogy for electrical demand and its relationship to the electric distribution system is the maximum speed a driver achieves while driving across town. Although the car is traveling below the peak speed the majority of the time, it must be capable of reaching that maximum speed for driver safety and satisfaction. Similarly, an electrical system must be designed to meet the peak demand, although the majority of the time the system operates well below the peak demand. The Fort Collins electrical system typically operates at about 60% of the maximum peak on an annual basis. There are daily peaks, monthly peaks and annual peaks. Customers and the City are billed monthly for peak demand. The graph below is a typical peak day curve for both summer and winter for the Platte River system. The summer peak is the higher of the two. The peak value may change but the load shape over the course of the day is very typical for each season. July 5, 2011 Page 7 Peak Load Winter and Summer Graph The Energy Policy goal of reducing the peak demand, translates to a reduction of approximately 15,000 kilowatts (kW). Fort Collins’ maximum peak demand has been 292,000 kW. In relative terms, a house typically uses between 3 – 6 kilowatts, a small business such as a retail shop has a peak demand of 15 – 25 kW, a retail space such as a grocery store is between 500 and 750 kW. Since 1982, the Light and Power utility has offered demand reduction programs which include customer incentives. Customers volunteer to have a device installed on their electric water heater unit and then, during peak periods, Light and Power will cycle the unit off and on for 15 minutes at a time throughout the peak period, thereby reducing the overall system peak. In return, the utility applies a customer credit of $4.00 per month to their account. In 2005, the program was expanded to include air-conditioning units. During the four-month period surrounding summer, the customer is paid an incentive of $4.00 per month for their participation in the program. It is currently estimated the program reduces peak by approximately 1,800 kW. The AMFC program will provide an upgrade of the existing demand response programs. This upgrade, along with the communication system and the advanced meters, will allow customers to utilize in-home displays, smart thermostats, and other emerging technologies, such as Home Energy Management Systems. Customers are not required to participate in these programs. The programs will be voluntary as they have always been. One of the identified risks in the project is associated with the implementation of the demand reduction and efficiency related technologies. The standards by which these technologies integrate with AMI systems are still under development and are more in the domain of the consumer electronics arena. Historically, utilities have invested in equipment with an expectation that it will last for decades. In the consumer electronics arena, the equipment becomes obsolete every three to five years. Additional risks exist due to lack of a clear perspective on what the types of programs and equipment the consumer wants. As part of AMFC program, the Utility is working with the Department of Energy (DOE) on a Customer Behavior Study (CBS), which includes up-front work to determine what technologies and July 5, 2011 Page 8 information customers desire and will be most responsive to. This study may include focus groups, surveys, interviews, and pilot programs of the technologies that are currently evolving in the demand response and energy management area. Programs will then be developed to support the customer’s needs and to help the Utilities achieve the maximum level of demand reduction, energy efficiency, and conservation. As part of AMFC program, the communications system will provide valuable information allowing us to integrate higher levels of distributed generation onto the distribution system, allowing the system to be designed and operated more efficiently. The system knowledge gained will help us maintain the high reliability our customers expect. Goal #2: Support the community’s carbon emissions goal of reducing the City’s carbon footprint 20% below 2005 levels by 2020 and 80% by 2050. AMFC program will achieve some direct carbon reduction. It is estimated that the AMI system will eliminate approximately 198,000 vehicle miles per year with a net carbon reduction of, 147,559 lbs of CO2, 241.6 lbs of Nitrogen Oxide (NOx), 11.5 lbs of Particulate Matter (PM-10), and 2.6 lbs of Sulfur Oxide (Sox) per year because of reduced meter reads, special reads and service calls. The Energy Policy set a goal of achieving a 1.5% reduction in annual energy use (based on a three- year average history). The AMFC program will allow customers who are interested to view their usage data on-line or via an in-home display. It is anticipated that this feature will be available to customers late in phase 2, approximately the 3rd quarter of 2012. Today, residential customers receive their energy usage for the previous month about nine days after the end of their billing cycle. It is difficult for customers to be actively engaged and informed about their energy and water usage, their cost, and what choices they may make differently, when the information they receive is 9 days or further in the past. The information that the AMFC system will provide via the internet will be about one day old. Once, the meter information is transmitted through the mesh network, it goes through a Validation, Estimation and Editing (VEE) process, and is then posted to a web portal. Those customers who choose to use an in-home display, smart thermostat, or a home energy management system will have data that is much closer to instantaneous. The information will be updated as often as the meter records data, which currently is planned for fifteen minutes or one-hour. The provision of more timely data, along with customer education and outreach on how this information can be used by customers to help them save, is part of the program. One example, of how a customer might benefit from the information might be that they receive a notification, via an email, text, page, or however they wish, when they have used 4000 gallons of water in a given billing cycle, and that they will soon enter the higher cost second-tier water rate at 5000 gallons. This is an example of a system that can provide the customer with information that allows them to make an informed decision about their water use. The same is true for electrical usage, whether it is a tiered demand rate, inclining block rate or Time-of-Use (TOU) rate. Customers can be informed as they reach higher-priced periods. The desired outcome is that the information provided through the AMI systems can be leveraged by customers to control their usage and costs and, in turn, help the Utilities reach their conservation and efficiency goals. July 5, 2011 Page 9 Goal #2 - Objectives and metrics speak to the need to meet the State Renewable Energy Standards, provide voluntary programs to help customers meet their renewable energy goals, increase the contribution of renewable energy to help meet our carbon reduction goals and include renewable energy sources that can be scheduled to maintain system stability and reliability. Utilities are working towards meeting all the goals summarized above. As we anticipate the many changes that the future will bring, we know the installation of solar panels (PV) will continue to come down in cost; within the decade, the cost of PV energy is expected to be the same or lower than utility prices; new technology and applications for existing distributed generation are becoming more attractive and affordable. Information about how the electrical system is operating becomes critical. As noted above, the current electrical grid is designed as a one-way delivery system. In order to manage multiple sources of energy on the complex mesh of electrical circuits, and to ensure the safe, reliable and efficient operation of the system, the information provided by the AMI system becomes critical. Council recently received a letter recommending that we establish new standards for the electrical system's construction, in anticipation and support of future distributed generation. The challenge is that the distribution system is designed and operated using mathematical models that view the design requirements from a 50,000-foot perspective. This methodology has worked well in the development of a robust and reliable system that serves customers today. However, when we start to consider changing construction practices, we cannot clearly define how the system should be designed and operated without detailed information in the portions of the distribution system where the greatest changes will be occurring. The implementation of the AMFC technology will provide us with the system operational information that will help us understand the time-of-day cyclic nature of the different elements of the system. AMFC helps us prepare for the future that our customers are already building. Project Update - Technology Selected The Advanced Metering Infrastructure (AMI) and the Meter Data Management System (MDMS) vendor have both been selected. Contract negotiations with both vendors are currently underway. The AMI system has several specific components. Specifically, the system includes the meters, the communication systems, the Information Technology (IT) components and the collection software, which is referred to as the Head End System (HES). The AMI system vendor that we have selected is Elster Inc. Elster is a well-established and experienced vendor in both the metering and AMI space. Elster has been providing metering to utilities for over 170 years. They currently have approximately 5 million AMI meters deployed and operating in the field and have completed over 90 installation projects. The AMI meters are a solid-state meter with a two way radio communication card, a remote connect / disconnect device, and a Home Area Network (HAN) communication card within the meter. The Home Area Network device is what communicates with in-home displays, smart thermostats or other consumer devices. All communications with the in-home device will be initiated by the customer and will be the customer’s choice. Figure 1, (Attachment 3), shows both residential and commercial Elster meters. July 5, 2011 Page 10 In order to bring information back to the utility, the meters communicate with a device called a Gatekeeper. The Gatekeeper serves as the conductor for the Neighborhood Local Area Network (NLAN) by controlling the network interconnection efficiency and collecting the metering data from the individual meters. A Gatekeeper can communicate with over 2000 meters. Typically, the Gatekeepers will be mounted on existing street light poles. A typical Gatekeeper is shown in attached Figure 2 (Attachment 3). The Gatekeeper communicates with the Distribution Wide Area Network (DWAN) router. The DWAN router will then pass the information to centralized routers that will send the information back to the utility via our existing fiber optic network. The DWAN routers will be mounted on the arms of existing streetlight and intersection light poles. Pictures of a DWAN router on a street light and being mounted are shown in Figure 3 (see Attachment 3). Attached Figure 4 (see Attachment 3) provides a graphic illustration of the communication system. The Utility has selected Siemens to supply of the Meter Data Management System (MDMS). Siemens has collaborated with E-meter to supply and configure the system. With the installation of the AMI system, the volume of data that the utility will be receiving will increase significantly. Currently, we receive one data point, once a month from each of our residential customer accounts and our small commercial General Service Accounts. In contrast, we currently receive 15-minute data from approximately 500 of our largest customers. With the installation of AMI meters, we expect to have the capability to get this level of resolution from all customers in the future. The MDMS is designed to help manage the information the AMI meters will provide. The system will: • Effectively manage the AMI provisioning/commissioning process • Reduce revenue loss through use of real-time validation algorithms and reporting that: N Detect unauthorized consumption N Detect leaks/tamper events N Identify failed meters and registers N Detect dead or dying meters • Track key infrastructure assets: meters, communication modules, pumps, valves, including compound meters • Systematically monitor events and issue work orders i.e. on pressure when maximum limits are exceeded/potential revenue protection issue, etc. • Support a systematic repair and replace program that extends infrastructure life and optimizes leak control programs through precise tracking • VEE (Validation – Error checking – and Editing) real-time the 15 minute, hourly and/or daily usage allowing for variable pricing options (TOU, CPP, CPR) • Manage events generated by the AMI system July 5, 2011 Page 11 A general outline of the current project schedule is provided below. Project timeline Completed • Nov. 22, 2010 – Jan 11, 2011: Prepare and Release Request for Proposal (RFP) for AMI and MDMS • January 2011 Through March 23, 2011: Evaluate Vendor RFP Responses, Conduct Vendor Interviews, Recommend Vendor Selection To Be Completed • March through June 2011: Contract negotiations with AMI & MDMS vendors • July 2011 through September 2011: Develop deployment contractor (RFP), release RFP select vendor • July 2011 through September 2011: Define requirements with AMI and MDMS vendors • September 2011 through December 2011: IT infrastructure installation, MDMS system installation and testing • September 2011 through November 2011: Contract negotiations with installation vendor • November 2011 through January 31, 2012: Deployment Planning and staging • February 1, 2012 through April 2012: Phase 1 - Installation of 4000 Electric meters, 2000 Water meters (end-to-end, or meter-to-bill test) • April through May 2012: System Functional test (prior to release to move to Phase 2) • May 24 through November 8, 2012: Phase 2 - Installation; (‘Interval’ Billing Tests, Mass Deployment) • November. 9, 2012 through June 7, 2013: Phase 3 - Installation; (‘Advanced’ Rates , Continued Mass Deployment) There are currently three primary concerns that have been voiced nationally related to AMI or smart meters. There are over 18 million AMI meters installed in the US and approaching 100 million worldwide. The upgrade of existing utility meters has raised concerns for some customers about the costs, health effects and privacy and security of the information broadcast by the meters. July 5, 2011 Page 12 Health effects • National concerns related to health effects have included: N The meters cause cancer N People suffering from electromagnetic sensitivity are being adversely affected by the meters. The meters selected operate in a frequency range between 902 megahertz (MHZ) and 928 MHZ. Other devices that operate in this spectrum are cell phones, cordless phones, wireless routers, TV and radio broadcasts, and other common devices. Figure 5 (Attachment 3) is a graphical representation of the electromagnetic spectrum. Health effects from Radio Frequency electromagnetic fields are a topic that has been raised across the country. A recent report released by the World Health Organization (WHO) International Agency for Research on Cancer (IARC) recently classified Cell phones as a Group 2B carcinogen. Group 2B elements are classified as possibly carcinogenic to humans. As noted above, the Elster AMI meters operate in the same frequency range as cell phones and other devices. Other studies specifically related to AMI technology such as a meta-study performed by the California Council on Science and Technology found the following: July 5, 2011 Page 13 The table below is from the Electric Power Research Institute (EPRI). EPRI is an independent, non-profit company that performs research, development and demonstrations in the electricity sector for the benefit of the public. The table represents the relative strengths associated with different devices that operate within the microwave frequency range. The EPRI information is also attached in graphical form as Figure 6 (Attachment 3). As shown the meters exposure levels are significantly less than those of a cell phone or other common devices. In order to support our community, Utilities is working with Dr. Bruce Cooper from the Health District of Northern Larimer to provide an independent and informed risk analysis to the community. Dr. Cooper will be in attendance at the upcoming work session. Additionally, Dr. Cooper will provide a statement of his conclusions around health risks of the project in Council’s Read-Before packet on Tuesday, July 5th. Privacy and Security • National concerns related to privacy have included: N Placing customer information at risk N “The Utility will know what I’m doing when” N The meters can be hacked July 5, 2011 Page 14 The City of Fort Collins Utilities takes customer privacy very seriously and has for many years. We recognize that emerging technologies open new avenues of risk. We are undertaking an extensive program to make sure that customer data is secure, confidential, and accurate in accordance with our existing policy that details how customer’s information is managed. Other than through a formal request from law enforcement customer information is not shared with anyone, unless formally released by the customer. The Utilities complies with all local, state and federal regulations to protect personal data and information. All customer information – including personal information, bill payment type or status, utility use - are strictly protected. Specifically: • Fort Collins Utilities is subject to the Colorado Open Records Act & Fort Collins Municipal Code 26-26, which govern the accessibility of public records • Fort Collins Utilities is subject to the FACT Act (Fair and Accurate Credit Transactions Act of 2003), which requires federal agencies, including the Federal Trade Commission (FTC), to establish guidelines for use by creditors to prevent identity theft. In 2007, the FTC published the “Red Flags Rules” requiring that creditors create and implement a program to address the detection, prevention and mitigation of identity theft. As a creditor, Fort Collins Utilities implemented an identity theft prevention program under the Red Flag Rules, effective December 31, 2011. The City has already met generally accepted best practices for cyber security. Through this project, the City is taking additional measures to secure its network and data by fully implementing the Cyber Security Plan submitted to, and approved by, the federal government. The City is also enforcing the same stringent standards on all project/utility vendors. Additionally, the City will be audited by the federal government to ensure all necessary precautions have been implemented. Utilities have conducted a risk assessment related to the AMFC communications system. The system was deemed as a low risk, low value cyber system. The data that will be communicated by the meters will be encrypted by the meter and then again, with a different encryption key at the gatekeeper and then again, as it moves thought the wide area network back to Utilities. The information that will be broadcasted will not have any customer information in it. The data will have to do with the operational health of the meter, energy and demand information, and a premise identifier. Even if intercepted, and decrypted there is little value to the data. Although Utilities is implementing best practices in relation to protecting privacy, we will also offer those concerned with privacy the option of having their meter information measured and recorded only once per day. As shown in Figure 7 (Attachment 3), the data received via the advanced meters does not provide information at a level of detail that would provide insight into specific activities. In addition, the data received is representing activity that occurred in the past. It does confirm what utilities across the country have known for years; that is, at certain times of the day households use more utility services than other times. The benefit of the higher resolution data is that it offers customers precisely the kind of information that will allow them to make choices that impact their energy consumption. July 5, 2011 Page 15 Lastly, Utilities is offering options to customers that would receive daily usage data transmitted from the meter or to have a meter manually read once per month; this would address the needs of those customers who still have continued privacy concerns. Note there is a cost associated with manually reading a meter once per month. Utilities estimate that it will cost approximately an additional $10 per month to read the meter. There may also be a one time up-front cost of $60 if the meter is replaced after initial deployment. Business Case and Project Cost • National concerns related to cost have included: N The meters are just another added expense to customers N The meters are inaccurate and bills will increase. The Utilities started researching the business case for an advanced metering project approximately three years ago to explore its viability from an economic, environmental and social standpoint. At that time, R.W. Beck a nationally recognized utility consulting firm worked closely with Utility staff to understand the benefits, risks and return on investment. Using best practices in business case analysis, that results showed a payback period of approximately 10-11 years. Although several project aspects have changed since this early analysis, it showed a positive return and a viable project on its own merits. Then, the federal government announced American Recovery and Reinvestment Act (ARRA) funding to upgrade the electric grid throughout the nation. Due to the early work that Fort Collins Utilities had done, we successfully competed for a matching grant. Black & Veatch / Enspiria, another nationally recognized firm, recently vetted the original business case at a high level and validated the conclusions. Although the scope of the project has increased and the grant money is part of the equation and other factors have changed in the years since the initial business case was developed, the payback period was modified only slightly to an 11-12 year payback. As noted above, the cost of the electric portion of the AMFC project is $31.4 million. A three-year, $15.7 million matching grant through the 2009 American Recovery and Reinvestment Act (ARRA) is helping to finance the project. The balance of the electric project expense is being covered by project savings. Bonds were issued to spread the costs over a longer time period. The water meter project is budgeted for $4 million. Grant funds are not available for the water portion of the project, but including them in the project is critical to the return on investment identified in the business case analysis. The financial savings realized through advanced meter systems are derived primarily from four sources, as follows: • Meter reading labor and expenses • Detection of service diversion July 5, 2011 Page 16 • Engineering and system benefits • Meter accuracy and registration It is worth commenting on the savings derived from the labor and operational expense of manual meter reading. Initially, investing in advanced meters will save the labor and operational expenses of reading meters. Fort Collins Utilities is working with meter readers to provide training and skill development for other jobs; several have already found new positions. In addition, there is information from national sources that speak to the business merits of advanced metering. For example, the Department of Energy finds that although the electricity system is 99.97 percent reliable, it still allows for power outages and interruptions that cost Americans at least $150 billion each year – about $500 for every man, woman and child in the country. This fact underscores the broader need to maintain the high level of reliability our system enjoys. System efficiency is very important to maximize the most efficient use of resources. The Department of Energy estimates that 25% of distribution infrastructure and 10% of all generation assets are required less than 400 hours per year or roughly 5% of the time. Platte River’s peaking units typically run less than this average. While advanced metering projects cannot eliminate the need for all new infrastructure, such systems will help defer or avoid some of it. After the development of a thorough business case, we are confident that this clearly shows a positive economic return and represents a solid investment for the community’s future. As such, it is a sound financial decision that will continue to support the needs of Fort Collins Utilities customers for many years beyond the payback horizon. ATTACHMENTS 1. “One Million Electric Vehicles By 2015” Report 2. Health Impacts of Radio Frequency from Smart Meters by the California Council on Science and Technology 3. Figures 1 thru 7. Pictures and color graphics 4. Powerpoint presentation 1 One Million Electric Vehicles By 2015 February 2011 Status Report ATTACHMENT 1 2 Introduction In his 2011 State of the Union address, President Obama called for putting one million electric vehicles on the road by 2015 – affirming and highlighting a goal aimed at building U.S. leadership in technologies that reduce our dependence on oil.1 Electric vehicles (“EVs”) – a term that includes plug-in hybrids, extended range electric vehicles and all- electric vehicles -- represent a key pathway for reducing petroleum dependence, enhancing environmental stewardship and promoting transportation sustainability, while creating high quality jobs and economic growth. To achieve these benefits and reach the goal, President Obama has proposed a new effort that supports advanced technology vehicle adoption through improvements to tax credits in current law, investments in R&D and competitive programs to encourage communities to invest in infrastructure supporting these vehicles. While several high profile vehicle market introductions such as the Chevrolet Volt and the Nissan Leaf have been initiated, questions “With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have a million electric vehicles on the road by 2015” - President Barack Obama, 2011 State of the Union Executive Summary President Obama’s goal of putting one million electric vehicles on the road by 2015 represents a key milestone toward dramatically reducing dependence on oil and ensuring that America leads in the growing electric vehicle manufacturing industry. Although the goal is ambitious, key steps already taken and further steps proposed indicate the goal is achievable. Indeed, leading vehicle manufacturers already have plans for cumulative U.S. production capacity of more than 1.2 million electric vehicles by 2015, according to public announcements and news reports. While it appears that the goal is within reach in terms of production capacity, initial costs and lack of familiarity with the technology could be barriers. For that reason, President Obama has proposed steps to accelerate America’s leadership in electric vehicle deployment, including improvements to existing consumer tax credits, programs to help cities prepare for growing demand for electric vehicles and strong support for research and development. 3 remain regarding the potential to reach the 2015 goal. Production capacity must be established, and technology, vehicle cost and infrastructure barriers must be addressed to achieve large-scale market introduction. This report provides a progress update toward achieving the goal: • The status of vehicle sales and future production volume estimates • Current federal government policies, investments, research and development, and demonstration efforts supporting the deployment of EVs • EV consumer demand This is an exceedingly dynamic and competitive field. Major announcements by companies and governments worldwide are made on a frequent basis. The plans of global companies and the policy initiatives of governments will surely change and shape the development of technology and markets during the next five years. Where We Are Today In 2010, the U.S. economy continued recovery from recession. As part of that recovery, sales of U.S. light-duty vehicles rebounded to approximately 12 million in 2010 from less than 10 million in 2009. Historically, U.S. sales of new light duty passenger vehicles ranged from 15-16 million per year from 2005-2008.2 Conventional hybrid electric vehicles (HEVs) have been on sale in the U.S. for over ten years, and today sales have grown to almost three percent of total light-duty vehicles. Over 1.6 million HEVs have been sold over the past six years.3 To reach the one million vehicle goal, EVs will need to average just under 1.7 percent of sales through 2015 (assuming sales of 12 million light- duty vehicles per year). With increases in the Corporate Average Fuel Economy (CAFE) standards, vehicle manufacturers are required to increase fuel economy through 2016, with further increases beyond 2016 under consideration. On March 30, 2009, the National Highway Traffic Safety Administration (NHTSA) published the final rule raising CAFE standards for both cars and light trucks. These new standards will encourage the expanded market entry of electric drive technologies. Market for Electric Drive Vehicles Expected to Increase Over the past few years, interest in EVs in the U.S. auto industry has surged, with manufacturers beginning to introduce new generations of EVs. For example, in 2010 General Motors introduced the Chevrolet Volt extended range electric vehicle into the U.S. market. The Volt can travel up to 40 miles using power from its lithium-ion battery pack. After that, the Volt can travel up to 375 miles in extended range using its internal combustion engine electric generator. GM has announced plans to build 15,000 Chevy Volts in 2011 and 45,000 in 2012. Based on news reports, the company is working on plans to increase its production target for 2012 to 120,000. (See Table references.) In late 2010, Nissan introduced the Leaf, a 100-mile range all-electric vehicle that incorporates an advanced lithium-ion battery as its sole power source. 4 The production capacity of EV models announced to enter the U.S. market through 2015 should be sufficient to achieve the goal of one million EVs by 2015. The table below shows EVs expected to enter the U.S. commercial market over the next few years, including the production capacity by year, based on manufacturer announcements and media reports. Major auto manufacturers such as Chrysler, BYD, Coda, Honda, Mitsubishi, Hyundai, Toyota, Volkswagen and Volvo are not included in this table, but have announced or are expected to introduce EVs in this time period. Because the U.S. is a major market for these automakers, it is likely that additional production capacity of several hundred thousand EVs is not accounted for in this table. Estimated U.S. Supply of Electric Vehicles from 2011 through 2015 Manufacturer and Model 2011 2012 2013 2014 2015 Total Fisker Karma PHEV 1,000 5,000 10,000 10,000 10,000 36,000 Fisker Nina PHEV 5,000 40,000 75,000 75,000 195,000 Ford Focus EV 10,000 20,000 20,000 20,000 70,000 Ford Transit Connect EV 400 800 1,000 1,000 1,000 4,200 GM Chevrolet Volt 15,000 120,000 120,000 120,000 120,000 505,000 Navistar eStar EV (truck) 200 800 1,000 1,000 1,000 4,000 Nissan LEAF EV 25,000 25,000 50,000 100,000 100,000 300,000 Smith Electric Vehicles Newton EV (truck) 1,000 1,000 1,000 1,000 1,000 5,000 Tesla Motors Model S EV 5,000 10,000 20,000 20,000 55,000 Tesla Motors Roadster EV 1,000 1,000 Think City EV 2,000 5,000 10,000 20,000 20,000 57,000 Cumulative Total 1,222,200 Note: The above numbers have been taken from announced production figures and media reports. In some cases more conservative estimates have been used due to: delays that have occurred since announced The 2011 Chevrolet Volt The 2011 Nissan Leaf 5 production levels, ramp rates to reach full production, consideration of the size of the market segment for that vehicle, and possible exportation of vehicles manufactured in the U.S. See the reference table for citations. Policy In recent years there have been a number of federal and state policy initiatives to encourage the introduction and sales of EVs. Industry can achieve its planned production with the support of policies that encourage investment in manufacturing facilities, enable technology demonstration and deployment and provide incentives to promote adoption and drive consumer demand. Manufacturing Investments Through the Recovery Act, the United States made an unprecedented investment to build our domestic manufacturing capacity and secure our position as a global leader in advanced lithium-ion battery technology. This investment includes: • $2.4 billion in loans to three of the world’s first electric vehicle factories in Tennessee, Delaware, and California. • $2 billion in grants to support 30 factories that produce batteries, motors, and other EV components. Companies are matching the funding dollar for dollar, doubling the impact of taxpayer investments. These grants are enabling companies to build the capacity to produce 50,000 EV batteries annually by the end of 2011 and 500,000 EV batteries annually by December 2014. Deployment, Demonstration, and Outreach Recovery Act funds are also supporting the largest-ever coordinated demonstration of EVs, including nearly 13,000 vehicles and more than 22,000 electric charging points in more than 20 cities across the country. Companies are matching this $400 million public investment dollar for dollar. This effort will provide important and detailed real-world operational data on vehicle usage, time-of-use and charging patterns, and potential impacts on our nation’s electrical grid. The demonstrations will document lessons learned that help streamline infrastructure permitting processes and make data available that can alleviate consumer uncertainty and help transition EVs from clusters of early adopters to national, mainstream use. Coordinated with this large-scale demonstration are programs to educate code officials, first responders, technicians, and engineers, who are critical components of the human infrastructure needed for a successful transition to electric-drive transportation, both in terms of consumer acceptance and public safety. The Department of Energy is also working with local leaders in their efforts to encourage EV adoption and drive consumer demand. Through a new competitive program, seed funding will help communities across the country with regulatory streamlining, infrastructure investments, vehicle fleet conversions, deployment of EV incentives, partnerships with major employers/retailers, and workforce training. The FY12 budget request seeks to expand this initiative so that up to 30 communities could receive grants of up to $10 million to help catalyze EV deployment (see text box on page 6).4 6 Incentives Tax incentives and other measures have been proven effective in providing the additional boost needed for mainstream consumers to choose EVs. The Recovery Act established tax credits for purchasing electric vehicles ($2,500 - $7,500 per vehicle, depending on the battery capacity) and conversion kits to retrofit conventionally powered vehicles with electric vehicle capability ($4,000 per vehicle, maximum). The President has also proposed transforming the existing $7,500 EV tax credit into a more accessible and even more attractive rebate at the dealership.5 In addition, nearly 40 U.S. states and the District of Columbia have adopted other measures promoting electric-drive vehicle usage, including high occupancy vehicle (HOV) privileges and waived emissions inspections, as well as tax credits/rebates and preferred purchase programs.6 Advancing Technologies through R&D The President has announced that the FY 2012 Budget will include enhanced R&D investments in battery and other electric drive technologies.7 Investments will support R&D initiatives through DOE’s Vehicle Technologies Program, as well as a new Energy Innovation Hub devoted to developing better batteries and energy storage capacity to support electric vehicles and other technologies. This focus on continued innovation complements ongoing R&D to support the development of critical technologies needed for New Initiatives to Support Advanced Technology Vehicles President Obama is proposing three steps to address consumer demand and position the United States as a global leader in manufacturing and deploying next- generation vehicle technologies: • Make electric vehicles more affordable with a rebate up to $7,500: The President is proposing to transform the existing $7,500 tax credit for electric vehicles into a rebate that will be available to all consumers immediately at the point of sale. • Advance innovative technologies through new R&D investments: Building on Recovery Act investments, the President’s Budget proposes enhanced R&D investments in electric drive, batteries, and energy storage technologies. • Reward communities that invest in electric vehicle infrastructure through competitive grants: To provide an incentive for communities to invest in EV infrastructure and remove regulatory barriers, the President is proposing a new initiative that will provide grants to up to 30 communities that are prioritizing advanced technology vehicle deployment. Source: http://www.whitehouse.gov/the-press-office/2011/01/26/vice-president- biden-announces-plan-put-one-million-advanced-technology- 7 the widespread introduction of electric drive vehicles. These efforts include battery development, power electronics and electric motors, and electric drive vehicle systems. Battery technology today is greatly different from that of the 1990s. The General Motors EV-1 had a range of 80 to 140 miles, but initially used lead-acid batteries having limited energy density, which resulted in a two-passenger vehicle, relatively short battery life, and a long recharging time. By contrast, today’s lithium-ion battery technology allows the Leaf, Volt, and other EVs to be 4- or 5-passenger vehicles, with an extended warranty on battery life, and much faster charging times. The Volt's lithium- ion battery technology is over 70 percent lighter than the EV-1's original lead-acid battery technology. Vehicle manufacturers currently employ lithium-ion batteries with excess capacity to ensure the batteries meet a ten-year battery life target. As greater confidence in battery life under real-world driving conditions develops, the amount of excess capacity installed is expected to decrease, and thus cost should decrease as well. GM recently announced that the Chevrolet Volt battery will now be operated using more than 65 percent of total capacity, instead of 50 percent, demonstrating continued improvement in today’s lithium- ion batteries.8 Next-generation lithium-ion batteries are likely to employ advanced electrodes such as silicon-based nanostructured anodes (instead of graphite), and high- capacity manganese-based cathodes, resulting in a significant increase in energy density and reduction in cost. New technologies continue to move from DOE laboratories to market– most recently Argonne National Laboratory has licensed advanced cathode technology to General Motors and battery suppliers LG Chem and Envia. These companies will now have the opportunity to build on DOE’s technology innovation with further improvements and specific market applications. Recovery Act investments will help cut battery costs. DOE and U.S. industry have invested over $3 billion in battery manufacturing facilities using Recovery Act and matching funds. Increasing the production output of a battery plant from 10,000 units/year to 100,000 units/year can directly reduce battery costs by 30-40 percent.9 DOE’s established cost target of $300/kWh by 2015 is an aggressive but achievable goal for lithium-ion batteries. Electric vehicle battery prices are expected to drop due to increased manufacturing know-how and economies-of-scale, learning curve improvements, lower-cost battery materials, and technical advancements in battery design. DOE supports a broad portfolio of electric drive vehicle battery R&D that spans basic research to applied development. The Office of Science supports fundamental basic energy research on enabling materials through the Energy Frontiers Research Centers. The Applied Research Projects Agency - Energy (ARPA-E) conducts transformational research on revolutionary, “game-changing” energy storage technology. And the Office of Energy Efficiency and Renewable Energy (EERE) battery R&D is focused on applied A123 Systems Battery Module 8 development and demonstration of advanced batteries to enable a large market penetration of electric drive vehicles. Consumer Demand While leading manufacturers already have plans for cumulative U.S. production capacity of more than one million electric vehicles by 2015, according to public announcements and news reports, production will only reach levels supported by consumer demand. What issues will influence purchasing decisions? Fleet buyers tend to make vehicle purchasing decisions based on the total cost of vehicle ownership; retail vehicle consumers tend to focus on initial price. The Boston Consulting Group report on “Batteries for Electric Vehicles” concluded that with current incentives and oil prices in the United States, EV purchasers will reach lower total ownership costs within 3 to 5 years of operation.10 These increasingly favorable economics for EVs aren’t going unnoticed by fleet buyers. General Electric announced that they will purchase 25,000 EV by 201511 – a strong indication that as EV total cost of ownership falls below that of conventional vehicles, fleet purchasers will respond positively. With the exception of a small segment of the new car buyer population, automobile consumers tend to be risk-averse, preferring well-proven technology. With automotive purchases generally the second largest financial purchase most families make, behind only housing, cost is considered carefully. And while automobile consumers do consider fuel consumption, they tend to discount future fuel savings. Studies have shown that consumers tend to assume that current fuel prices are good estimates of future prices.12 Thus purchasers during periods of high fuel prices value fuel efficiency more than purchasers during periods of low fuel prices. While availability of the current $7,500 tax credit is attractive to consumers, the President’s proposal to convert this credit to benefit the consumer at the point-of-sale will likely make the incentive even more attractive since consumers will not have to wait until the end of the year to receive the credit.13 Although consumers have proven to be highly sensitive to initial price, they are also willing to pay premiums for vehicle options or attributes that resonate with them. EVs have unique attributes which may appeal to consumers. Exceptionally quiet operation, high torque (good acceleration), and low lifetime operating costs are examples of attributes that will attract consumers. Other features may also prove attractive to consumers, such as avoiding the gasoline refueling experience. In addition, car purchasing decisions are influenced by style and statements of personal identity; the powertrain configurations of EVs will provide styling options not available to conventionally powered vehicles. Fuel price matters when consumers make automobile purchasing decisions. If oil prices increase, or expectation of further oil price increases becomes prevalent,14 interest in EVs will likely increase as well. 9 There is clearly substantial consumer interest in electric vehicles, as demonstrated by the larger-than-anticipated pre-orders for the Nissan Leaf and the Chevrolet Volt. Whether this interest translates into sales beyond the initial “early adopter” market will depend on initial consumer experience with these early vehicles, and on how that experience is communicated and perceived by the rest of the car buying public. Uncertainties about EVs – including their resale value, range and availability of convenient charging facilities -- may impose sales barriers. As noted earlier, there is considerable work underway to develop data on performance and reliability of EVs, and to communicate that information to the public. The performance and cost effectiveness of the early EVs in the market will be a major but unknowable factor in how many EVs are on the road by 2015. The cumulative impacts of the various policy initiatives, the experience of the early purchasers of electric-drive vehicles and future oil prices will all play a role in determining future consumer demand. Summary In his 2011 State of the Union address, President Obama called for putting one million electric vehicles on the road by 2015 – affirming and highlighting a goal aimed at building U.S. leadership in technologies that reduce our dependence on oil. This goal represents a key milestone in transforming our national vehicle fleet, a transformation that will deliver significant benefits for the American people, including: • Dramatically reducing petroleum dependence and improving transportation sustainability; • Improved environmental stewardship; • Job creation and economic growth. Government policies are critical enablers which influence the rate that advanced vehicles are adopted on a large scale. In addition to existing policies, the Administration’s new three-part plan supports electric vehicle manufacturing and adoption through improvements to tax credits in current law, investments in R&D, and a new competitive program to encourage communities to invest in electric vehicle infrastructure. These policies will help attain the 2015 goal. Reaching the goal is not likely to be constrained by production capacity. Major vehicle manufacturers have announced (or been the subject of media reports) that indicate a cumulative electric drive vehicle manufacturing capacity of over 1.2 million vehicles through 2015. Strong incentives, research and development, and assistance in establishing manufacturing and infrastructure is underway or planned. These activities directly support consumer demand of these technologies, and mitigate some of the uncertainty associated with the large-scale adoption of electric drive vehicles. 10 References Notes and References for Estimated U.S. Supply of Electric Vehicles from 2011 through 2015 Manufacturer and Model References Fisker Karma PHEV http://media.fiskerautomotive.com/about_fisker/in_the_new s/and_the_strangest_paint_award_goes_to_fisker/, October 1, 2010 Fisker Nina PHEV http://media.fiskerautomotive.com/about_fisker/in_the_new s/and_the_strangest_paint_award_goes_to_fisker/, October 1, 2010 Ford Focus EV The estimates are pushed back one year from the reference initial year of production of 2011. Reference: http://green.autoblog.com/2010/10/22/ford-sets- 2011-electric-focus-2011-production-target-at-10-000-2/, October 22, 2010 Ford Transit Connect EV http://www.motortrend.com/roadtests/alternative/1009_ford _transit_connect_electric/specs.html, October 4, 2010 GM Chevrolet Volt http://www.bloomberg.com/news/2011-01-21/gm-said-to- plan-doubling-2012-production-capacity-of-chevrolet-volt- hybrid.html, January 21, 2011 Navistar eStar EV (truck) The 2011 total of 200 trucks includes the 78 trucks already built during 2010. The 2012 number is a conservative extrapolation from the goal of selling 700 eStars by mid- 2012. http://www.businessweek.com/technology/content/jan2011/ tc20110120_063762.htm, January 20, 2011 Nissan Leaf EV http://www.allcarselectric.com/blog/1054255_nissan-2011- leaf-will-reach-full-production-by-march, January 25, 2011; http://www.forbes.com/2010/10/25/japan-autos-electric- technology-nissan-leaf.html, October 25, 2010 Smith Electric Vehicles Newton EV (truck) http://www.businessweek.com/technology/content/jan2011/ tc20110120_063762.htm, January 20, 2011 Tesla Motors Model S EV http://www.greentechmedia.com/articles/read/tesla-files- for-ipo-it-wants-100-million/, January 10, 2010 Tesla Motors Roadster EV http://www.plugincars.com/tesla-roadster/review, March 9, 2010; http://www.wired.com/autopia/2010/01/teslas- roadster-to-exit-in-2011/#, January 29, 2010 Think City EV http://gigaom.com/cleantech/the-think-citys-u-s-price- launch-plans/, November 16, 2010; http://evworld.com/news.cfm?newsid=24433, November 25, 2010 11 1 The President first announced this goal as a candidate in a speech in Lansing, Michigan on August 4, 2008. http://my.barackobama.com/page/community/post/stateupdates/gG5zCW. He first reiterated the goal as President at a speech in Pomona, California on March 19, 2009. http://www.energy.gov/7067.htm. 2 Transportation Energy Data Book, 29th Edition, Stacy C. Davis, et.al. 3 IEA Hybrid and Electric Vehicle Implementing Agreement, “Hybrid and Electric Vehicles: the Electric Drive Advances,” March 2010 4 White House Press Release “Vice President Biden Announces Plan to Put One Million Advanced Technology Vehicles on the Road by 2015,” January 26, 2010, http://www.whitehouse.gov/the-press-office/2011/01/26/vice-president-biden-announces-plan-put-one- million-advanced-technology- 5 White House Press Release “Vice President Biden Announces Plan to Put One Million Advanced Technology Vehicles on the Road by 2015,” January 26, 2010, http://www.whitehouse.gov/the-press-office/2011/01/26/vice-president-biden-announces-plan-put-one- million-advanced-technology- 6 IEA Hybrid and Electric Vehicle Implementing Agreement, “Hybrid and Electric Vehicles: the Electric Drive Advances,” March 2010 7 White House Press Release “Vice President Biden Announces Plan to Put One Million Advanced Technology Vehicles on the Road by 2015,” January 26, 2010, http://www.whitehouse.gov/the-press-office/2011/01/26/vice-president-biden-announces-plan-put-one- million-advanced-technology- 8 http://gm-volt.com/2010/10/26/chevrolet-volt-will-utilize-10-4-kwh-of-battery-to-achieve-ev-range/ 9 Santini, et.al., “Modeling of Manufacturing Costs of Lithium-Ion Batteries for HEVs, PHEVs and EVs,” Proceedings of the 25th Electric Vehicle Symposium, November 2010. 10 The Boston Consulting Group, “Batteries for Electric Vehicles: Challenges, Opportunities, and the Outlook to 2020”, January, 2010 11 http://www.gereports.com/in-largest-single-commitment-ge-to-buy-25000-electric-vehicles/ 12 See EPA-420-R-10-008, “How Consumers Value Fuel Economy: A Literature Review,” March 2010 13 Kelly Sims Gallagher and Erich Muehlegger “Giving green to get green? Incentives and consumer adoption of hybrid vehicle technology” in Journal of Environmental Economics and Management 61 (2011) p. 1-15 14 http://www.eia.doe.gov/oiaf/ieo/world.html JANUARY 2011 HEALTH IMPACTS OF RADIO FREQUENCY FROM SMART METERS ATTACHMENT 2 1 ACKNOWLEDGMENTS We would like to thank the many people who provided input and feedback towards the completion of this report. Without the insightful feedback that these individuals generously provided, this report could not have been completed. We would like to give special thanks to the California Smart Grid Center, College of Engineering and Computer Science at the California State 2 Table of Contents Letter from CCST ............................................................................................................................ 3 Key report findings ......................................................................................................................... 4 Other considerations ...................................................................................................................... 4 Legislative request ......................................................................................................................... 6 Approach ........................................................................................................................................ 6 Two types of radio frequency effects: Thermal and Non-‐thermal ................................................. 7 Findings .......................................................................................................................................... 7 What are smart meters? ................................................................................................................ 9 Why are smart meters being installed throughout California? .................................................... 11 What health concerns are associated 3 Letter from CCST With rapidly emerging and evolving technologies, lawmakers at times find themselves pressed to make policy decisions on complex technologies. Smart meters are one such technology. Smart meters are being deployed in many places in the world in an effort to create a new generation of utility service based on the concepts of a smart grid, one 4 Health Impacts of Radio Frequency from Smart Meters Response to Assembly Members Huffman and Monning California Council on Science and Technology January 2011 KEY REPORT FINDINGS 1. Wireless smart meters, when installed and properly maintained, result in much smaller levels of radio frequency (RF) exposure than many existing common household electronic devices, particularly cell phones and microwave ovens. 2. The current 5 Figure 1. Comparison of Radio-‐Frequency Levels from Various Sources in μW /cm2 Note: Exposure levels in µW/cm2 obtained from Table 2 and converted from mW/cm2. Smart meter figures represent 100% duty cycle (i.e., always on) as hypothetical maximum use case. Minimum Maximum 0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000 1000 50 40 4 0.2 0.005 5000 200 6 Legislative Request On July 30, 2010, California Assembly Member Jared Huffman wrote to the California Council on Science and Technology (CCST) to request that the Council perform an “independent, science-‐ based study…[that] would help policy makers and the general public resolve the debate over whether smart meters present a significant risk of adverse health effects.” California Assembly Member Bill 7 Two Types of Radio Frequency Effects: Thermal and Non-‐thermal Household electronic devices, such as cellular and cordless telephones, microwave ovens, wireless routers, and wireless smart meters produce RF emissions. Exposure to RF emissions may lead to thermal and non-‐thermal effects. Thermal effects on humans have been extensively studied and appear to be well understood. The Federal Communications Commission (FCC) 8 2. At this time there is no clear evidence that additional standards are needed to protect the public from smart meters or other common household electronic devices. No clear causal relationship between RF emissions and non-‐thermal human health impacts has been scientifically established, nor have the mechanisms that might lead to such a biological impact been clearly identified. Additional research 9 What are Smart Meters? Smart meters measure attributes of electricity, natural gas, or water as delivered to consumers and transmit that information (e.g., usage) digitally to utility companies. Some smart meters are also designed to transmit real-‐time information to the consumer. These smart meters replace traditional, analog meters and meter readers with an automated process that is expected to 10 Figure 3. Simplified depiction of Smart Meter system network. Arrows show the use of radiofrequency (RF) signals for automated meter reading, communications among electric power meters, relays, access points, the company’s enterprise management systems. The future home access network will operate within the house. Smart meters have evolved from automatic meter reading (AMR; i.e., replacing meter readers) to a 11 cycle. For purposes of this report we include a hypothetical scenario where the smart meter is continually transmitting. Even in this 100% duty cycle situation the power output would be well below the FCC limits. Smart meters are designed to transmit data to a utility access point that is usually 25 feet above ground, on utility or light poles. 12 Figure 4. Illustration of components of the PG&E Smart Meter Program Upgrade showing the use of radiofrequency (RF) signals for communications among electric power meters, relays, access points and, ultimately, the company’s enterprise management systems. (Source Silver Spring Network4) Smart meters will also allow utilities to communicate grid conditions to customers through price signals, so that consumers, via their 13 grid networks, including the use of smart meters.5 After review and authorization from the California Public Utilities Commission,6 utilities in California have begun to install smart meters throughout the state. Some California utilities (such as Sacramento Municipal Utility District) have received significant federal funding for smart meter deployment from the American Recovery and Reinvestment Act (federal stimulus package). Many 14 meters are unlikely to produce thermal effects; however it is not scientifically confirmed whether or what the non-‐thermal effects on living organisms, and potentially, human health might be. These same concerns over potential impacts should apply to all other electronic devices that operate with similar frequency and power levels, including cell phones, computers, cordless phones, televisions, and wireless routers. 15 the cumulative impact from all RF emitting devices including that of a network of smart meters operating throughout a community.12 There currently is no conclusive scientific evidence pointing to a non-‐thermal cause-‐and-‐effect between human exposure to RF emissions and negative health impacts. For this reason, regulators and policy makers may be prudent to call for more research while continuing 16 The FCC guidelines measure exposure to RF emissions in two ways. Specific absorption rate (SAR) measures the rate of energy absorption and is measured in units of watts-‐per-‐kilogram of body weight (W/kg). It accounts for the thermal effects on human health associated with heating body tissue and is used as a limiting measurement for wireless devices, such as mobile 17 the human body absorbs even less energy, and the threshold for the 2.4 GHz transmitter for home area network communications is consequently higher, 1000 μW/cm2. PG&E commissioned a 2008 study by Richard Tell Associates, “Supplemental Report on An Analysis of Radiofrequency Fields Associated with Operation of the PG&E Smart Meter Program Upgrade System.” In this study of PG&E’s proposed 18 Figure 5. FCC maximum permissible exposure limits on power density rise with frequency because the human body can safely absorb more energy at higher frequencies. The estimated maximum exposure from a 1-‐Watt AMR transmitter at 5% duty cycle (i.e., 72 minutes/day) and one-‐foot distance is 18 μW/cm2, or 3% of the FCC limit. Even if a meter malfunctioned and 19 Figure 6. Power density from a sample smart meter versus distance;29 1-‐Watt emitter at 50% duty cycle. Typical smart meter AMR transmitter power density declines rapidly with distance. The rapid drop of power density with distance (inverse-‐square law) is similar for various duty cycles and different sets of source data. Comparison of Electromagnetic Frequencies from Smart Meters and Other 20 fields of about 0.2 – 1.0 μW /cm2.31, 32,33 People in metropolitan areas are exposed to radiofrequency from radio and television antennas, as well, although for most of the population, exposure is quite low, around 0.005 μW /cm2.34 Figure 7. Comparison of Radio-‐Frequency Levels from Various Sources in μW /cm2 Note: Exposure levels in µW/cm2 obtained from Table 2 21 Table 2: Radio-‐Frequency Levels from Various Sources Source Frequency Exposure Level (mW/cm2) Distance Time Spatial Characteristic Mobile phone 900 MHz, 1800 MHz 1—5 At ear During call Highly localized Mobile phone base station 900 MHz, 1800 MHz 0.000005—0.002 10s to a few thousand feet Constant Relatively uniform Microwave oven 2450 MHz ~50.05-‐0.2 2 inches2 feet During use Localized, non-‐ uniform Local area networks 2.4—5 GHz 0.0002—0.001 0.000005—0.0002 3 feet Constant when nearby Localized, non-‐ uniform Radio/TV broadcast Wide spectrum 0.001 (highest 22 What is Duty Cycle and How Does it Affect Human Health? Duty cycle refers to the fraction of time a device is transmitting. For instance, a duty cycle of 1% means the device transmits RF energy 1% of a given time period. One percent of the time in a day is equivalent to 14.4 minutes per day. The duty 23 What About Exposure Levels from a Bank of Meters and from Just Behind the Wall of a Single Meter? In a November 2010 study Electric Power Research Institute (EPRI)35 field tested exposure levels from a bank of 10 meters of 250 mW power level at one foot distance in order to simulate a bank of smart meters located at 24 Public Information and Education It is important that consumers have clear and easily understood information about smart meter emissions as well as readily available access to clear, factual information and education on known effects of RF emissions at various field strengths and distances from an array of devices commonly found in our world. Equipped with this information, people can 25 meters would not address the significantly greater challenge presented by the billions of mobile phones in use globally. Key Factors to Consider When Evaluating Exposure to Radiofrequency from Smart Meters 1. Signal Frequency Compare to devices in the 900 MHz band and 2.4 GHz band Frequency similar to mobile phones, Wi-‐Fi, laptop computers, walkie-‐talkies, baby monitors, microwave ovens 2. Signal 26 Conclusion The CCST Project Team, after carefully reviewing the available literature on the current state of science on health impacts of radiofrequency from smart meters and input from a wide array of subject matter experts, concludes that: 1. The FCC standard provides a currently accepted factor of safety against known thermally induced health impacts of smart meters and other electronic 27 Appendix A – Letters Requesting CCST 28 29 30 31 32 Appendix B – Project Process CCST Smart Meter Project Approach Assembly Member Huffman (Marin) (July 30, 2010 letter) and Assembly Member Monning (Santa Cruz) (September 17, 2010 letter) requested CCST’s assistance in determining if there are health safety issues regarding the new SMART meters being installed by the utilities. In addition, the City of Mill Valley sent a letter 33 Peer Review: After the draft report was vetted in great detail by the Smart Meter Project Team, it was forwarded to the CCST Board and Council for peer review. Public Comment: The report is being posted to the CCST website that will allow the general public to comment. 34 Appendix C – Project Team The California Council on Science and Technology adheres to the highest standards to provide independent, objective, and respected work. Board and Council Members review all work that bears CCST’s name. In addition, CCST seeks peer review from external technical experts. The request for rigorous peer review results in a protocol that ensures the specific 35 Patrick Mantey Director, UC Center for Information Technology Research in the Interest of Society (CITRIS) @ Santa Cruz, University of California, Santa Cruz Mantey holds the Jack Baskin Chair in Computer Engineering and was the founding Dean of the Jack Baskin School of Engineering. He is now the director of CITRIS at UC Santa Cruz and of ITI, the 36 Vice President at Southern California Edison. Papay received a B.S. in Physics from Fordham University, a M.S. in Nuclear Engineering from MIT, and a Sc.D. in Nuclear Engineering from MIT. He is a member of the National Academy of Engineering and served on its Board of Councilors from 2004-‐2010. He served as CCST Council Chair from 2005 through 2008, 37 Appendix D – Written Submission Authors Written Input Received from: Physical Sciences/Engineers Kenneth Foster, Professor, Department of Bioengineering, University of Pennsylvania Rob Kavet, Physiologist/Engineer, Electric Power Research Institute (EPRI) Biologists/medical De-‐Kun Li, MD, Ph.D., Senior Reproductive and Perinatal Epidemiologist, Division of Research, Kaiser Foundation Research Institute, Kaiser Permanente Asher Sheppard, Ph.D., Asher Sheppard Consulting, trained in physics, environmental medicine, 38 Appendix E – Additional Materials Consulted All sources can be accessed through the CCST website at http://ccst.us American Academy of Pediatrics • The Sensitivity of Children to Electromagnetic Fields American Academy of Pediatrics (August 3, 2005) Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) • www.arpansa.gov.au Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) • Radiation Protection -‐ Committee on Electromagnetic Energy 39 Radiofrequency and Microwave Energy IEEE Engineering in Medicine and Biology Magazine (April 2005) Commonwealth Club of California • Commonwealth Club of California -‐ The Health Effects of Electromagnetic Fields (Video) (November 18, 2010) Electric Power Research Institute (EPRI) • emf.epri.com EMF/RF Program at EPRI • Radio-‐Frequency Exposure Levels from SmartMeters Electric Power Research Institute (November 2010) -‐ accessed via the Internet December 40 • Radio Frequency Safety FAQ's • RF Safety Page • Federal Communications Commission Response to Cindy Sage (August 6, 2010) • FCC Certifications o FCC Certification for the Silver Spring Networks Devices -‐ September 28, 2009 o FCC Certification for the Silver Spring Networks Devices -‐ September 28, 2009 o FCC Certification for the Silver Spring Networks Devices -‐ September 4, 2007 o FCC Certification for the 41 International Commission on Non-‐Ionizing Radiation Protection (2009) National Academies Press • Identification of Research Needs Relating to Potential Biological or Adverse Health Effects of Wireless Communication National Academies Press (2008) • An Assessment of Potential Health Effects from Exposure to PAVE PAWS Low-‐ Level Phased-‐Array Radiofrequency Energy (9.9MB PDF) National Academies Press (2005) National Cancer Institute • Cell Phones and Cancer Risk 42 Swedish State Radiation Protection Authority (SSI) • The Nordic Radiation Safety Authorities See no Need to Reduce Public Exposure Generated by Mobile Bas Stations and Wireless Networks Swedish State Radiation Protection Authority (SSI) (2009) University of Ottawa • Wireless Communication and Health -‐ Electromagnetic Energy and Radiofrequency Radiation FAQ's University of Ottawa, RFcom World Health Organization • Database of Worldwide EMF Standards 43 o Bioinitiative Report: The Interphone Brain Tumor Study (1.6MB PDF) Cindy Sage, Editorial Perspective o Bioinitiative Report: Steps to the Clinic with ELF EMF (1.0MB PDF) o Mobile Phone Base Stations -‐ Effects on Wellbeing and Health Pathophysiology (August 2009) o Increased Blood-‐Brain Barrier Permeability in Mammalian Brain 7 Days after Exposure to the Radiation from a GSM-‐900 Mobile Phone Pathophysiology (August 2009) 44 • NIOSH Program Portfolio Centers for Disease Control and Prevention (CDC) • Radio Frequency RF Safety and Antenna FAQs • Smart Grid Information Clearinghouse (SGIC) • stopsmartmeters.org 45 Appendix F – Glossary Access point -‐ A term typically used to describe an electronic device that provides for wireless connectivity via a WAN to the Internet or a particular computer facility. Duty cycle – A measure of the percentage or fraction of time that an RF device is in operation. A duty cycle of 100% corresponds to continuous 46 Microwatt per square centimeter (µW/cm2) -‐ A measure of the power density flowing through an area of space, one millionth (10-‐6) of a watt passing through a square centimeter. Radiofrequency (RF) -‐ The RF spectrum is formally defined in terms of frequency as extending from 0 to 3000 GHz, the frequency range of interest is 3 kHz to 300 47 Appendix G – CCST 2011 BOARD MEMBERS Karl S. Pister, Board Chair; Chancellor Emeritus, UC Santa Cruz; and Dean and Roy W. Carlson Professor of Engineering Emeritus, UC Berkeley Bruce M. Alberts, Professor, Department of Biochemistry & Biophysics, UC San Francisco Ann Arvin, Vice Provost and Dean of Research, Lucile Salter Packard Professor of Pediatrics and Professor of Microbiology 48 Appendix H – CCST 2011 COUNCIL MEMBERS Miriam E. John, Council Chair and Emeritus Vice President, Sandia National Laboratories, California Peter Cowhey, Council Vice Chair and Dean, School of International Relations and Pacific Studies, UC San Diego Wanda Austin, President and CEO, The Aerospace Corporation Julian Betts, Professor of Economics, UC San Diego George Blumenthal, Chancellor, UC Santa Cruz 49 Appendix I – Report Credits CCST Smart Meters Project Team: Rollin Richmond (Chair), President Humboldt State University, CSU Jane Long, Associate Director at Large, Global Security Directorate Fellow, Center for Global Security Research Lawrence Livermore National Laboratory Emir Macari, Dean of Engineering and Computer Science, California State University, Sacramento and Director of the California Smart Grid Center Patrick Mantey, ATTACHMENT 3 Figure 1: Elster residential and commercial meters Figure 2: Elster Gatekeeper Figure 3: Distribution wide area network (DWAN) Tropos router. ATTACHMENT 3 Figure 4 – System Solution diagram Figure 5 Electromagnetic Spectrum ATTACHMENT 3 Figure 6 ATTACHMENT 3 15 minute data over 1 day 1 hour data over 1 day daily data over 1 day Monthly data over 1 day Typical Residential Load Profile April 2011- Day 4 - 1.0 2.0 3.0 4.0 5.0 6.0 0:001:002:003:004:005:006:007:008:009:0100:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 0:00 kW kW 15 minute Typical Residential Load Profile April 2011- Day 4 - 1.0 2.0 3.0 4.0 5.0 6.0 0:001:002:003:004:005:006:007:008:009:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 0:00 kW kW hour Typical Residential Load Profile April 2011- Day 4 - 1.0 2.0 3.0 4.0 5.0 6.0 0:001:002:003:004:005:006:007:008:009:0100:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 0:00 kW kW Day Typical Residential Load Profile April 2011- Day 4 - 1.0 2.0 3.0 4.0 5.0 6.0 0:001:002:003:004:005:006:007:008:009:0100:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 0:00 kW kW month Figure 7: Sample Data for 15 minute, hourly, daily and monthly over 1 day 1 1 Modernizing Electric & Water Infrastructure July 05, 2011 Work Session June 14, 2011 2 Objectives Background info Detail how Advanced Meter Fort Collins supports Policies and Goals Show the three faces of Advanced Meter Fort Collins Provide a project update Discuss the issues resolution and communication around national hot topics: Price/Cost Privacy Health Discuss Customer Options Detail Broadband Communications Network Opportunities ATTACHMENT 4 2 3 Background • 2008 City Council Adopts the Climate Action Plan - Advanced Metering Infrastructure (AMI) identified as one of the strategies for achieving goals. • 1/2009 – Utilities Staff works with R.W. Beck to develop a business case for an AMI system. • 3/2009 – Business case for AMI is positive. AMI proposed as part of Budgeting For Outcomes (BFO) process. • 6/2009 – American Recovery and Reinvestment Act (ARRA) Smart Grid Investment Grants (SGIG) announced.. 4 Background • 7/2009 – Utilities bundles Long Range IT Strategic Plan elements with AMI project and submits grant application • 10/2009 – Department of Energy notifies City of matching grant award for $15.7 million ($31.4 M total project) • 11/2009 – Utilities pulls BFO offer for AMI and returns with financing options to match the grant funding in April of 2010. • 4/2010 – 5/2010 Council approves appropriation for AMI and sale of bonds to finance Light and Powers match to DOE grant. • 6/2010 – 7/2010 Council approves $4 million appropriation for Water meter portion of AMI. 3 5 Background • 6/2010 – City signs Agreement with DOE – three year deadline to spend grant funds begins • 8/2010 – Utilities contracts with Enspiria Inc. to act as the City’s technical advisor through Smart Grid Investment Grant program. • 9/2010 – 11/2010 – Utilities works with Enspiria to develop and release AMI and Meter Data Management System Request for Proposal’s (RFP). • 1/2011 – 3/2011 Evaluate RFP’s, conduct interviews and select vendor • 3/2011 – Present – Contract negotiations with selected vendors – Elster for AMI – Siemens / Emeter for Meter Data Management System 6 Council Established Goals • 2008 Climate Action Plan – 20% Greenhouse gas reduction below 2005 levels by 2020, 80% by 2050 • Advanced Metering Infrastructure first proposed in Climate Action Plan 4 7 Council Established Goals • Energy Policy – 1.5% energy savings – Reduce system peak by 5% by 2015 10% by 2020 – Provide Highly reliable electric service • Average System Availability Index greater than 99.9886% (2010 – 99.9967%) • Customer Average Interruption Index less than 60 minutes (2010 • System Average Interruption Frequency Index less than 1.0 ( 2010 - – Develop renewable resources to meet the Colorado Renewable Energy Standard 8 Achieving the Goals • How does the AMI system help achieve the Climate Action Plan and Energy Policy Goals? • The communication system installed as part of the AMI system provides a foundation for future technologies and programs plus it provides efficiencies today. 5 9 The 3 Faces of Advanced Meter Fort Collins Ongoing Utility Modernization (e.g. Advanced Meter Fort Collins) Local Green Energy (e.g. FortZED, Solar Incentives) New Customer Options (e.g. Smart Energy Pioneer Program) 10 Ongoing Utility Modernization 6 11 Fort Collins ongoing Modernization 1968 Under-ground Distribution System 1979 Remote System Monitoring (SCADA) 1982 Demand Side Management 1985 Underground Conversion 1990 Remote Commercial Meter Reading 1999 Substation Automation 2012 Small Commercial & Residential Remote Meter Reading, Advanced Meters Fort Collins (Advanced Metering Infrastructure – AMI) 12 Advanced Meter Fort Collins •• New electronic meters (electric and water) •• $32M total cost, $16M from a Department of Energy Grant •• 10-10 -year payback from operational savings (i.e. meter reading) •• Most meters installed from mid-mid -2012 through mid-mid -2013 •• Smart Meters enable many options for customers 7 13 Typical Home Wireless Network The AMI system is much like the wireless computer network in our homes. The Local Area Network (LAN) is made up of computers, game machines, video, television and other wireless devices. The LAN connects to the rest of the world through a Wide Area Network (WAN). LAN WAN Elster EEnneerrggyyAAxxiiss Backbone control A field proven (Tried & True) end-to-end Network offering providing required Smart Grid characteristics; • Authentication • Confidentiality • Data Integrity • Reliability • Security firewall Gatekeeper meters meter/repeater router EAMS DDWWAANN NNLLAANN Utility Network HAN Enterprise Network DA Devices Standalone Gatekeeper 8 15 Remote Meter Reading iissnn’’t t New to Us 16 But it might be new to you 9 17 Ongoing Utility Modernization Results: Higher Reliability & Lower Operating Costs Our customers have some of the lowest bills in the state Our 99.9967% reliability attracts and keeps tech business Remote monitoring speeds repair and reduces truck- rolls Remote meter reading reduces operational costs A smart grid is an integral part of our past and future 18 Local Green Energy lowering the cost of adding renewables More of this... Less of this... 10 19 Local Green Energy Clouds with a Solar Lining Solar energy (photovoltaic) is getting cheaper, and cheaper. But, when a cloud passes between the sun and a solar panel, output can drop in just seconds. Balancing the grid traditionally means adding backup generators (e.g. peakers). With a smarter grid, we can balance the grid with existing load and generation – saving money! 20 Today (without smart grid) 11 21 Today (without smart grid) 22 Today (without smart grid) 12 23 With Smart Grid Tomorrow 24 Tomorrow With Smart Grid 13 25 Tomorrow With Smart Grid 26 New Customer Options & Choices 14 27 New Customer Options & Choices Consumers – know what your bill is before you get it Rate Options: Recharge your electric vehicle when it is cheapest Sell your solar energy to the grid when it is more valuable Smart Home – emerging smart appliances will automatically run to save you money 28 New Electronic Meters Can Provide a Wealth of Info – or Not Can be programmed to communicate... Daily total usage Every 15 minutes – detailed usage Can integrate with a Home Area Network Or can be completely silent – just like today 15 29 “Smart Energy Pioneer” Pilot Program A simple Time-of-Use Rate Don’t need EV or PV to do this – but it helps! Integrate with Home Area Networks Limited enrollment (first 50?) Conceptual Pioneer Smart Rate 30 Lower Cost Electric Vehicle Charging Charge at night – and save! We have enough generation and distribution for lots of EVs, but not if they charge at the same time. So this helps all of us. 16 31 Lower Cost Electric Vehicle Charging Charge at night – and save! We have enough generation and distribution for lots of EVs, but not if they charge at the same time. So this helps all of us. Charge at Night! 32 Photovoltaics More Valuable 17 33 Smarter Homes – can automatically use electricity when it is cheaper if it works with your schedule. 34 New Customer Options: Results Saving your petunias from the meter reader Manage Energy Use – gives engaged consumers access to more information about their usage. Lower Cost Electric Vehicle charging Higher Value Solar PV Enabling new Smart Appliances and Home Devices to automatically save money New Pricing Options like the “Smart Energy Pioneer Rate” 18 35 Update on Project Status Technology & System Update Project Schedule Stakeholder Engagement Internal: Organizational Change Management External: Public Involvement & Communications A3 ALPHA Meter/Gatekeeper EnergyAxis: Plug & Play, Auto-Optimizing (Controlled Mesh), Redundant Level 1 Level 1 Level 4 Level 3 Level 2 Level 5 Level 2 Level 3 Level 4 Level 4 Level 4 Level 1 Level 3 DWANs Controlled Mesh vs. Uncontrolled = Preserves Bandwidth 19 Elster EEnneerrggyyAAxxiiss Backbone A field proven (Tried & True) end-to-end Network offering providing required Smart Grid characteristics; • Authentication • Confidentiality • Data Integrity • Reliability • Security firewall Gatekeeper meters meter/repeater control router EAMS DDWWAANN NNLLAANN Utility Network HAN Enterprise Network Meters w/DWAN Direct connection DA Devices Standalone Gatekeeper 38 Status: Project Schedule 20 39 Status: Organizational Change Management (OCM) Plan Developed Process & leads identified Impacted Functions Identified Implementation Started 40 PICP: Customer Segmentation Status: Public Involvement 21 41 Public Involvement & Communications Methods: Electronic & Traditional Media Internet Website Research FAQ’s Flyer Presentations Advisory Panel Others under development per plan Graphic Identity/Sub-branding Issues Resolution & Communications Communications Underway with “Home Base” Messaging General information Price/cost Privacy Health 45 22 43 Issues: Price/Cost Cost issues Utilities has presented a positive business case that was prepared using nationally recognized standards to Council and the community. The original business case was prepared by staff and R.W. Beck; reviewed and validated at a high level by Enspiria. Headline cases such as those in CA and TX claiming the meters are inaccurate have proved unwarranted by independent laboratories. The meters open the door for new rate forms that reflect cost of energy at time of use along with other new opportunities, such as increased energy efficiencies. 44 Issues: Privacy & Security Privacy issues related to customer information Utilities adheres to strict policies regarding the protection of customer information; Federal Regulation “Red Flags; FACT Act” Colorado open records Internal policies How the data is handled How it is released Security 23 45 Issues: Health Health effects from Radio Frequency electromagnetic fields. Levels are much less than those from cell phones, microwaves, wireless routers, cordless phones etc.. Utilities is working with Dr. Bruce Cooper from the Health District to provide an independent and informed risk communication to the community. 46 24 47 Options for Advanced Meter Fort Collins What is the default meter setup? How often will the meters record data? Options How often are the meters read? Pilot programs Manual reading 48 Customer Options 25 49 Customer Option 1 Standard Mode with Full Functionality Data Collection & Transmission Collects data in 15-minute or one-hour intervals Transmits 4 to 6 times per day via a 1.5-second signal Costs Installation and operating costs included in project budget Considerations Allows full benefits of new technology (for both the customers and the system) Creates optimal performance 50 Customer Option 2 Limited Mode with Lower Functionality Data Collection & Transmission Collects data only once per day Transmits 4 to 6 times per day via a 1.5-second signal Costs May include customer cost to program meter Specific costs under development Considerations Collects data less frequently and on a less detailed basis Limits customer benefits and adds cost Diminished ability to support Energy Policy 26 51 Customer Option 3 Manual Mode with Minimal Functionality Data Collection & Transmission Meter read manually once per month Costs Will include customer cost for manual read Specific system and customer costs under development Considerations Automatic data transmission is disabled Requires monthly service call (technician and vehicle trip) Limits customer benefits and adds cost Diminished ability to support Energy Policy 52 Customer Options Summary Considerations Option 1 Standard Option 2 Limited Option 3 Manual Functionality and ability to take advantage of new technology; allows full customer benefits High Limited Minimal Data collected in 15-minute to one-hour intervals 9 Data collected once per day 9 Data collected once per month via manual read 9 Data transmitted 4 to 6 times per day via a 1.5 second signal 9 9 Additional customer cost 9 9 Additional system cost 9 Requires monthly service call 9 Ability to support Energy Policy High Limited Minimal Optional 27 Tropos Network Opportunities Distribution Automation HAN Meter LAN Distribution Wide Area Network Core Network Mobile Applications Power Quality Sensors Outage Management AMI Network Demand Response PHEV Charging Station Utility Core Systems Distributed Generation DWAN 54 Other Local AMI Projects • Poudre Valley REA – Fort Collins/Loveland - 2009 – 36,000 Landis & Gyr Automated Meters • Fort Collins Loveland Water District / South Fort Collins Sanitation District - 2010 – Sensus & FlexNet14,000 Automated Meters • Cheyenne Light, Fuel & Power - 2010 – 38,000 Elster Meters • Black Hills Energy – Pueblo - 2008 – 56,500 Elster Meters – 750,000 utility customers in CO, Iowa, Kansas, Montana, SD, WY • Xcel Energy – 2008 – 50,000 Meters • City of Fountain - 2011 – Cooper Meters • Colorado Springs - 2009 – 530,000 Landis & Gyr Meters 28 55 Other City Projects • Oklahoma City, OK –Public Safety (Policy & Fire), Building Inspectors, Mobile Workforce and Traffic Control • Corpus Christi, TX – AMI Metering, Mobile Workforce, Building Inspectors, Public Safety, Public Works, Schools • Glendale Water and Power-AMI Metering, Mobile workforce • Burbank Water & Power-AMI Metering, Mobile Workforce, Demand Response, other city services • Rock Hill, SC- AMR, AMI, Mobile Public Safety, Video Security, Public Access Hot Zones • Phoenix, AZ - Traffic Controller Management, signal management, adaptive traffic profiles, predefined event profile, Future signal communications • Tucson, AZ - Mobile Telemedicine, Traffic Controllers, Police Services, Future Intersection Video Surveillance • Ponca City, OK - City workforce, Public Safety, mobile water, energy, SCADA use for work orders, Transportation, Ponca City Free Wi-Fi Service 56 Other City Projects • Savannah, GA- Public Safety, Video Surveillance, Future AMR, ITS, mobile city operations, asset tracking • Lompoc, CA- AMI, Public Internet Access Service, Police, Future Fire, building inspectors • Baton Rouge, LA- Gunshot Location System, Video Surveillance, Future Public Safety Applications • ADWEA – Abu Dhabi, U.A.E-AMR, AMI, Street Lighting Control, Mobile broadband for field workers, Remote SCADA control & monitoring • Avista – Spokane, WA – Distribution Automation, Future AMI, mobile workforce • Vancouver, BC - Public Transit Signal Prioritization • Redwood City, CA - Automated Parking Meters • Mountain View, CA - Free Community Access, AMR • Laguna Beach, CA - Video Fire Watch, Video Lifeguard, Free Public Internet Access Service 29 57 Conclusions Advanced Meter Fort Collins is currently behind schedule by approximately 2 weeks due to contract negotiations with Elster. Providing a timely, truthful and transparent dialogue related to the issues of Cost, Health and Privacy with Council on July 5. Need direction on pursuing opportunities related to the Tropos Broadband Distribution Wide Area Network 58 …Thank you! For more information go to: fcgov.com/advancedmeter Director, CITRIS @ Santa Cruz Ryan McCarthy, 2009 CCST Science and Technology Policy Fellow Larry Papay, CEO, PQR, LLC, mgmt consulting firm David Winickoff, Assistant Professor of Bioethics and Society, Department of Environmental Science, Policy and Management, UC Berkeley Paul Wright, Director, UC Center for Information Technology Research in the Interest of Society (CITRIS) With Additional Assistance From: JD Stack, Administrator, California Smart Grid Center, College of Engineering and Computer Science, California State University, Sacramento CCST Executive Director: Susan Hackwood Project Manager: Lora Lee Martin, Director, S&T Policy Fellows CCST Staff: Donna King, Executive Assistant and Accountant Sandra Vargas-‐De La Torre, Project Coordinator, Layout Susan Bryant, Former Vice Chancellor for Research, UC Irvine Charles Elachi, Director, Jet Propulsion Laboratory David Gollaher, President and CEO, California Healthcare Institute Corey Goodman, Former President, Biotherapeutics and Bioinnovation Center, Pfizer M.R.C. Greenwood, President, The University of Hawai’i System Susan Hackwood, Executive Director, California Council on Science and Technology Bryan Hannegan, Vice President of Environment and Renewables, Electric Power Research Institute Sung-‐Mo “Steve” Kang, Chancellor, University of California, Merced Charles Kennedy, Vice President for Health Information Technology, WellPoint, Inc. Jude Laspa, Deputy Chief Operating Officer, Bechtel Group, Inc. William Madia, Former Senior Executive Vice President of Laboratory Operations, Battelle David W. Martin, Jr., M.D., Chairman & CEO, AvidBiotics Corporation Fariborz Maseeh, Founder and Managing Principal, Picoco LLC George H. Miller, Director, Lawrence Livermore National Laboratory Michael Nacht, Dean, Goldman School of Public Policy, UC Berkeley Stephen D. Rockwood, Executive Vice President, Science Applications International Corporation Jeffrey Rudolph, President and CEO, California Science Center Shankar Sastry, Dean, College of Engineering, University of California, Berkeley Soroosh Sorooshian, Distinguished Professor and Director, Center for Hydrometeorology & Remote Sensing (CHRS), UC Irvine James L. Sweeney, Director, Precourt Institute for Energy Efficiency, and Professor of Management Science and Engineering, Stanford University S. Pete Worden, Director, NASA Ames Research Center Julie Meier Wright, President and CEO, San Diego Economic Development Corporation Kathy Yelick, Director, National Energy Research Scientific Computing Center (NERSC), Lawrence Berkeley National Laboratory and Immunology, Stanford University Warren J. Baker, Emeritus, President, California Polytechnic State University, San Luis Obispo Peter Cowhey, Council Vice-‐Chair and Dean, School of International Relations and Pacific Studies, UC San Diego Bruce B. Darling, Executive Vice President, University of California Susan Hackwood, Executive Director, California Council on Science and Technology Randolph Hall, Vice Provost for Research Advancement, University of Southern California Charles E. Harper, Executive Chairman, Sierra Monolithics, Inc. Miriam E. John, Council Chair and Emeritus Vice President, Sandia National Laboratories, California Mory Gharib, Vice Provost, California Institute of Technology Bruce Margon, Vice Chancellor of Research, University of California, Santa Cruz Tina Nova, President, CEO, and Director, Genoptix, Inc. Lawrence T. Papay, CEO and Principal, PQR, LLC Patrick Perry, Vice Chancellor of Technology, Research and Information Systems, California Community Colleges Rollin Richmond, President, Humboldt State University Sam Traina, Vice Chancellor of Research, University of California, Merced GHz. Repeater unit -‐ A device that can simultaneously receive a radio signal and retransmit the signal. Repeater units are used to extend the range of low power transmitters in a geographical area. Router -‐ An electronic computer device that is used to route and forward information, typically between various computers within a local area network or between different local area networks. Smart meter -‐ A digital device for measuring consumption, such as for electricity and natural gas, and sending the measurement to a utility company. Automated meter reading (AMR) meters send information one-‐way only. Automated meter infrastructure (AMI) meters are capable of two-‐way communications. Specific absorption rate (SAR) -‐ The incremental energy absorbed by a mass of a given density. SAR is expressed in units of watts per kilogram (or milliwatts per gram, mW/g). Transmitter -‐ An electronic device that produces RF energy that can be transmitted by an antenna. The transmitted energy is typically referred to a radio signal or RF field. Wide area network (WAN) -‐ A computer network that covers a broad area such as a whole community, town, or city. Commonly, WANs are implemented via a wireless connection using radio signals. High-‐speed Internet connections can be provided to customers by wireless WANs. Wi-‐Fi -‐ An name given to the wireless technology used in home networks, mobile phones, and other wireless electronic devices that employ the IEEE 802.11 technologies (a standard that defines specific characteristics of wireless local area networks). operation (e.g., 24 hours/day). A duty cycle of 1% corresponds to a transmitter operating on average 1% of the time (e.g., 14.4 minutes/day). Electromagnetic field (EMF) -‐ A composition of both an electric field and a magnetic field that are related in a fixed way that can convey electromagnetic energy. Antennas produce electromagnetic fields when they are used to transmit signals. Federal Communications Commission (FCC) -‐ The Federal Communications Commission (FCC) is an independent agency of the US Federal Government and is directly responsible to Congress. The FCC was established by the Communications Act of 1934 and is charged with regulating interstate and international communications by radio, television, wire, satellite, and cable. The FCC also allocates bands of frequencies for non-‐government communications services (the NTIA allocates government frequencies). The guidelines for human exposure to radio frequency electromagnetic fields as set by the FCC are contained in the Office of Engineering and Technology (OET) Bulletin 65, Edition 97-‐01 (August 1997). Additional information is contained in OET Bulletin 65 Supplement A (radio and television broadcast stations), Supplement B (amateur radio stations), and Supplement C (mobile and portable devices). Gigahertz (GHz) -‐ One billion Hertz, or one billion cycles per second, a measure of frequency. Hertz -‐ The unit for expressing frequency, one Hertz (Hz) equals one cycle per second. Megahertz (MHz) -‐ One million Hertz, or one million cycles per second, a unit for expressing frequency. Mesh network -‐ A network providing a means for routing data, voice and instructions between nodes. A mesh network allows for continuous connections and reconfiguration around broken or blocked data paths by “hopping” from node to node until the destination is reached. Milliwatt per square centimeter (mW/cm2) -‐ A measure of the power density flowing through an area of space, one thousandth (10-‐3) of a watt passing through a square centimeter. o Public Health Implications of Wireless Technologies Pathophysiology (August 2009) o Genotoxic Effects of Radiofrequency Electromagnetic Fields Pathophysiology (August 2009) o Epidemiological Evidence for an Association Between Use of Wireless Phones and Tumor Diseases Pathophysiology (August 2009) o Public Health Risks from Wireless Technologies: The Critical Need for Biologically-‐based Public Exposure Standards for Electromagnetic Fields (2.9MB PDF) BioInitiative Briefing for President-‐Elect Obama Transition Team o The BioInitiative Report: A Rationale for A Biologically-‐based Public Exposure Standard for Electromagnetic Fields (ELF and RF) (3.6MB PDF) Cindy Sage PowerPoint Presentation (November 2007) Wilner & Associates o SmartMeters and Existing Electromagnetic Pollution Wilner & Associates (January 2011) -‐ This report was not commissioned by CCST o Application for Modification Before the California Public Utilities Commission (3.5MB PDF) Other Documents • Health Canada Safety Code 6 and City of Toronto's Proposed Prudent Avoidance Policy (2010) • Transmitting Smart Meters Pose A Serious Threat To Public Health (2010) • RF Safety and WiMax FAQ's: Addressing Concerns About Perceived Health Effects (April 2008) Relevant Websites • EMF -‐ Portal • emfacts.com • emfsafetynetwork.org • lbagroup.com • WHO -‐ Electromagnetic Fields • Electromagnetic Fields and Public Health -‐ Base Stations and Wireless Networks (Fact Sheet N°304) World Health Organization (May 2006) • Electromagnetic Fields and Public Health -‐ Electromagnetic Hypersensitivity (Fact Sheet N°296) World Health Organization (December 2005) • Electromagnetic Fields and Public Health -‐ Mobile phones (Fact Sheet N°193) World Health Organization (May 2010) Unsolicited Submissions Documents Provided by Alexander Blink, Executive Director of the DE-‐Toxics Institute, Fairfax CA o Points and Sources Submitted for Consideration by Alexander Blink 2 o Points and Sources Submitted for Consideration by Alexander Blink 1 o Public Health Implications of Wireless Technologies, Cindy Sage o Memory and Behavior, By Henry Lai, Bioelectromagnetics Research Laboratory, University of Washington Sage Consulting o Assessment of Radiofrequency Microwave Radiation Emissions from Smart Meters Sage Associates (January 2011) o Cindy Sage Letter to Julius Knapp (FCC) (September 22, 2010) o Response Letter to Cindy Sage from Julius Knapp (FCC) (August 6, 2010) o Cindy Sage Letter to Edwin D. Mantiply (FCC) (March 15, 2010) o Bioinitiative Report: A Rational for a Biologically-‐based Public Exposure Standard for Electromagnetic Fields (ELF and RF) (3.1MB PDF) o Bioinitiative Report: What is the BioInitiative Report? o Bioinitiative Report: Myocardial Function Improved by Electromagnetic Field Induction of Stress Protein hsp70 (1.1MB PDF) (Fact Sheet) National Cancer Institute • Cell Phones and Brain Cancer: What We Know (and Don't Know) National Cancer Institute (September 23, 2008) National Institute of Environmental Health Sciences • Electric and Magnetic Fields National Institute of Environmental Health Sciences PG&E • Understanding Radio Frequency (RF) PG&E • Supplemental Report on An Analysis of Radiofrequency Fields Associated with Operation of PG&E SmartMeter Program Upgrade System Richard A. Tell, Richard Tell Associates, Inc. (October 27, 2008) • Smart Grid: Utility Challenges in the 21st Century (7.4MB PDF) Andrew Tang, Smart Energy Web, Pacific Gas and Electric Company (September 18, 2009) • Summary Discussion of RF Fields and the PG&E SmartMeter System Richard A. Tell, Richard Tell Associates, Inc. (2005 Report and 2008 Supplemental Report) • Analysis of RF Fields Associated with Operation of PG&E Automatic Meter Reading Systems Richard A. Tell, Richard Tell Associates, Inc. and J. Michael Silva, P.E. Enertech Consultants (April 5, 2005) Provided by Raymond Neutra • www.ehib.org/emf The California Electric and Magnetic Fields (EMF) Program • Should the World Health Organization (WHO) Apply the Precautionary Principal to Low and High Frequency Electromagnetic Fields? Raymond Richard Neutra Society for Risk Analysis • Risk Governance for Mobile Phones, Power Lines and Other EMF Technologies Society for Risk Analysis (2010) Silver Spring Networks Devices -‐ July 6, 2007 • Questions and Answers about Biological Effects and Potential Hazards of Radiofrequency Electromagnetic Fields Federal Communications Commission Office of Engineering & Technology (August 1999) • Evaluating Compliance with FCC Guidelines for Human Exposure to Radiofrequency Electromagnetic Fields Federal Communications Commission Office of Engineering & Technology (August 1997) Food and Drug Administration • No Evidence Linking Cell Phone Use to Risk of Brain Tumors U.S. Food and Drug Administration (May 2010) Health Protection Agency • Wi-‐Fi Health Protection Agency (Last reviewed: October 26, 2009) • Cordless Telephones -‐ Digital Enhanced Cordless Telecommunications (DECT) and other Cordless Phones Health Protection Agency (Last reviewed: September 4, 2008) International Commission on Non-‐Ionizing Radiation Protection (ICNIRP) • www.icnirp.de International Commission on Non-‐Ionizing Radiation Protection (ICNIRP) • International Commission on Non-‐Ionizing Radiation Protection (ICNIRP) on the Interphone Publication International Commission on Non-‐Ionizing Radiation Protection (May 18, 2010) • ICNIRP Statement on the "Guidelines for Limiting Exposure to Time-‐Varying Electric, Magnetic, and Electromagnetic Fields (up to 300 GHz)" International Commission on Non-‐Ionizing Radiation Protection (September 2009) • Epidemiologic Evidence on Mobile Phones and Tumor Risk International Commission on Non-‐Ionizing Radiation Protection (September 2009) • Exposure to High Frequency Electromagnetic Fields, Biological Effects and Health Consequences (100 kHz -‐ 300 GHz) 2010 • Perspective on Radio-‐Frequency Exposure Associated With Residential Automatic Meter Reading Technology Electric Power Research Institute (EPRI) (February 22, 2010) • Testing and Performance Assessment for Field Applications of Advanced Meters Electric Power Research Institute (EPRI) (December 4, 2009) • Overview of Personal Radio Frequency Communication Technologies Electric Power Research Institute (EPRI) (September 9, 2008) • Characterizing and Quantifying the Societal Benefits Attributable to Smart Metering Investments Electric Power Research Institute (EPRI) (July 2008) • Metering Technology Electric Power Research Institute (June 20, 2008) • The BioInitiative Working Group Report Electric Power Research Institute (EPRI) (November 23, 2007) • An Overview of Common Sources of Environmental Levels of Radio Frequency Fields Electric Power Research Institute (EPRI) (September 2002) Environmental Protection Agency • United States Environmental Protection Agency's Response to Janet Newton (March 8, 2002) • United States Environmental Protection Agency's Response to Jo-‐Anne Basile (September 16, 2002) Epidemiology • Prenatal and Postnatal Exposure to Cell Phone Use and Behavioral Problems in Children Epidemiology July 2008 -‐ Volume 19 -‐ Issue 4 -‐ pp 523-‐529 European Journal of Oncology -‐ Ramazzini Institute • Non-‐Thermal Effects and Mechanisms of Interaction between Electromagnetic Fields and Living Matter (2010) Federal Communications Commission Public Health Issues (Fact Sheet) Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) (May 2010) • Radiation Protection -‐ Mobile Telephones and Health Effects Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) (June 25, 2010) Documents From the California Department of Public Health (CDPH) • Mixed Signals About Cellphones' Health Risks Hang Up Research The Chronicle (September 26, 2010) • Summary of the Literature: What do we Know About Cell Phones and Health? (July 20, 2010) • Brain Tumor Risk in Relation to Mobile Telephone Use: Results of the INTERPHONE International Case -‐ Control Study Oxford University Press (March 8, 2010) • Mobile Phones and Health U.K. Department of Health • Late Lessons from Early Warnings: Towards Realism and Precaution with EMF? David Gee, European Environment Agency, (January 30, 2009) • Statement of Finnish Radiation and Nuclear Safety Authority (STUK) Concerning Mobile Phones and Health Radiation and Nuclear Safety Authority -‐ STUK (January 7, 2009) • Fact Sheet: Children and Safe Cell Phone Use Toronto Public Health (July 2008) • Children and Mobile phones: The Health of the Following Generations in Danger Russian National Committee on Non-‐Ionizing Radiation Protection (April 14, 2008) • AFSSE Statement on Mobile Phones and Health French Environmental Health and Safety Agency -‐ AFSSE (April 16, 2003) Committee on Man and Radiation (COMAR) • IEEE Engineering in Medicine and Biology Society Committee on Man and Radiation (COMAR) • COMAR Technical Information Statement the IEEE Exposure Limits for and neuroscience Magda Havas, B.Sc., Ph.D., Environmental & Resource Studies, Trent University, Peterborough, Canada Cindy Sage, MA, Department of Oncology, University Hospital, Orebro, Sweden and Co-‐ Editor, BioInitiative Report Ray Neutra, MD, Ph.D., Epidemiologist, retired Chief of the Division of Environmental and Occupational Disease Control, California Department of Public Health (CDPH) after which he was appointed to the Board. David E Winickoff Associate Professor of Bioethics and Society, Department of Environmental Science, Policy and Management, UC Berkeley David Winickoff (JD, MA) is Associate Professor of Bioethics and Society at UC Berkeley, where he co-‐directs the UC Berkeley Science, Technology and Society Center. Trained at Yale, Harvard Law School, and Cambridge University, he has published over 30 articles in leading bioethics, biomedical, legal and science studies journals such as The New England Journal of Medicine, the Yale Journal of International Law, and Science, Technology & Human Values. His academic and policy work spans topics of biotechnology, intellectual property, geo-‐engineering, risk-‐based regulation, and human subjects research. Paul Wright Director, UC Center for Information Technology Research in the Interest of Society (CITRIS) As Director of CITRIS Wright oversees projects on large societal problems such as energy and the environment; IT for healthcare; and intelligent infrastructures such as: public safety, water management and sustainability. Wright is a professor in the mechanical engineering department, and holds the A. Martin Berlin Chair. He is also a co-‐director of the Berkeley Manufacturing Institute (BMI) and co-‐ director of the Berkeley Wireless Research Center (BWRC). Born in London, he obtained his degrees from the University of Birmingham, England and came to the United States in 1979 following appointments at the University of Auckland, New Zealand and Cambridge University England. He is also a member of the National Academy of Engineering. Ryan McCarthy Science and Technology Policy Fellow, California Council on Science and Technology McCarthy recently completed the CCST Science and Technology Policy Fellowship in the office of California Assembly Member Wilmer Amina Carter, where he advised on issues associated with energy, utilities, and the environment, among others. McCarthy holds a master and doctorate degree in civil and environmental engineering from UC Davis, and a bachelor’s degree in structural engineering from UC San Diego. His expertise lies in transportation and energy systems analysis, specifically regarding the electricity grid in California and impacts of electric vehicles on energy use and emissions in the state. Information Technologies Institute in the Baskin School of Engineering. In 1984, he joined the UCSC faculty to start the engineering programs, coming from IBM where he was a senior manager at IBM Almaden Research. His research interests include system architecture, design, and performance, simulation and modeling of complex systems, computer networks and multimedia, real-‐time data acquisition, and control systems. Mantey is a Fellow of the Institute of Electrical and Electronics Engineers. His current projects at CITRIS include the Residential Load Monitoring Project and work on power distribution system monitoring and reliability. Mantey received his B.S. (magna cum laude) from the University of Notre Dame, his M.S. from the University of Wisconsin-‐Madison, and his Ph.D. from Stanford University, all in electrical engineering. He is a Fellow of the Institute of Electrical and Electronics Engineers (IEEE). Emir José Macari Dean of Engineering and Computer Science, California State University, Sacramento and Director of the California Smart Grid Center Prior to his appointment as dean at CSU Sacramento, Macari was dean of the College of Science, Mathematics and Technology at the University of Texas at Brownsville. Prior to that, he served as the program director for the Centers of Research Excellence in Science and Technology at the National Science Foundation. He spent five years as the Chair and Bingham C. Stewart Distinguished Professor in the Department of Civil and Environmental Engineering at Louisiana State University. At the Georgia Institute of Technology he taught both engineering and public policy and at the University of Puerto Rico he was a professor and director of Civil Infrastructure Research Center. He has also worked as a civil engineer in private industry and has been a fellow at NASA. Macari holds both a doctorate and a master’s degree in civil engineering geomechanics from the University of Colorado. He has a bachelor’s degree in civil engineering geomechanics from Virginia Tech University. Larry Papay CCST Board Member CEO, PQR, LLC, mgmt consulting firm Papay is currently CEO and Principal of PQR, LLC, a management consulting firm specializing in managerial, financial, and technical strategies for a variety of clients in electric power and other energy areas. His previous positions include Sector Vice President for the Integrated Solutions Sector, SAIC; Senior Vice President and General Manager of Bechtel Technology & Consulting; and Senior issue being addressed is done so in a targeted way with results that are clear and sound. In all, this report reflects the input and expertise of nearly 30 people in addition to the project team. Reviewers include experts from academia, industry, national laboratories, and non-‐profit organizations. We wish to extend our sincere appreciation to the project team members who have helped produce this report. Their expertise and diligence has been invaluable, both in rigorously honing the accuracy and focus of the work and in ensuring that the perspectives of their respective areas of expertise and institutions were taken into account. Without the insightful feedback that these experts generously provided, this report could not have been completed. Rollin Richmond, Smart Meter Project Chair, CCST Board Member President Humboldt State University, CSU Prior to Richmond’s appointment at Humboldt State University in 2002, he had a distinguished career as a faculty member, researcher in evolutionary biology and academic administrator. Richmond received a Ph.D. in genetics from the Rockefeller University and a bachelor’s degree in zoology from San Diego State University. Dr. Richmond’s career has included: Chairperson of biology at Indiana University, founding Dean of the College of Arts and Sciences at the University of South Florida, Provost at the State University of New York at Stony Brook, and Provost and Professor of Zoology and Genetics at Iowa State University. He was named the sixth President of Humboldt State University in July of 2002. Dr. Richmond is a fellow of the American Association for the Advancement of Science and a member of Phi Beta Kappa. His research interests are in evolutionary genetics. Jane Long, CCST’s California’s Energy Future Project Co-‐Chair and CCST Sr. Fellow Associate Director at Large, Global Security Directorate Fellow, Center for Global Security Research Lawrence Livermore National Laboratory Dr. Long is the Principal Associate Director at Large for Lawrence Livermore National Laboratory working on energy and climate. She is also a Fellow in the LLNL Center for Global Strategic Research. Her current interests are in reinvention of the energy system in light of climate change, national security issues, economic stress, and ecological breakdown. She holds a bachelor's degree in engineering from Brown University and Masters and Ph.D. from UC Berkeley. to CCST (September, 2010) in support of Mr. Huffman’s request. (Appendix A -‐ letters) The CCST Executive Committee appointed a Smart Meter Project Team that oversaw the development of a response on the issue (Appendix C): • Rollin Richmond (Chair), President Humboldt State University, CSU • Jane Long, Associate Director at Large, Global Security Directorate Fellow, Center for Global Security Research Lawrence Livermore National Laboratory • Emir Macari, Dean of Engineering and Computer Science, California State University, Sacramento and Director of the California Smart Grid Center • Patrick Mantey, Director, CITRIS @ Santa Cruz • Ryan McCarthy, 2009 CCST Science and Technology Policy Fellow • Larry Papay, CEO, PQR, LLC, mgmt consulting firm • David Winickoff, Assistant Professor of Bioethics and Society, Department of Environmental Science, Policy and Management, UC Berkeley • Paul Wright, Director, UC Center for Information Technology Research in the Interest of Society (CITRIS) In addition to those on the project team, CCST approached over two dozen technical experts to contribute their opinion to inform CCST’s response. The experts were referred from a variety of sources and were vetted by the Smart Meter Project Team. Efforts were made to include both biological and physical scientists and engineers to help provide broad context and perspective to the response. Many of the experts approached indicated they did not time to provide a written response however they provided references to additional experts and/or literature for review. A few experts identified were not asked to contribute due to affiliations that were felt to be a conflict of interest. Experts were asked to provide written comment on two issues, to provide referral to other experts, and to suggest literature that should be reviewed. Appendix D provides a list of those experts who provided written comment. Smart Meter Project Team members and the experts providing written technical input completed a conflict of interest disclosure form to reveal any activities that could create the potential perception of a conflict. In addition to written and oral input from technical experts, CCST identified relevant reports and other sources of information to inform the final report. This material can be found listed in Appendix E and on a CCST website: http://ccst.us/projects/smart/. devices in the same range of RF emissions. Exposure levels from smart meters are well below the thresholds for such effects. 2. There is no evidence that additional standards are needed to protect the public from smart meters. The topic of potential health impacts from RF exposure in general, including the small RF exposure levels of smart meters, continues to be of concern. This report has been developed to provide readers and consumers with factual, relevant information about the: • Scientific basis underpinning current RF limits • Need for further research into RF effects • Relative nature of RF emissions from a wide array of devices commonly used throughout world (e.g., cellular and cordless phones, Wi-‐Fi devices, laptop computers, baby monitors, microwave ovens). CCST encourages the ongoing development of unbiased sources of readily available and clear facts for public information and education. A web-‐based repository of written reports, frequently asked questions and answers, graphics, and video demonstrations would provide consumers with factual, relevant information with which to better understand RF effects in our environment. Strength (or Power Density) Microwatts/square centimeter (µW/cm2) Meter signal strength very small compared to other devices listed above 3. Distance from Signal Signal strength drops rapidly (doubling distance cuts power density by four) Example: 1 ft. – 8.8 µW/cm2 3 ft. – 1.0 µW/cm2 10 ft. – 0.1 µW/cm2 4. Signal Duration -‐ Extremely short amount of time (2.0-‐5.0%, max.) -‐ No RF signal 95-‐98% of the time (over 23 hours/day) -‐ Often overlooked factor when comparing devices. -‐ Short duration combined with weak signal strength yields tiny exposures 5. Thermal Effects -‐ Scientific consensus on proven effects from heat at high RF levels -‐ FCC “margin-‐of-‐safety” limits 50 times lower than hazardous exposure level -‐ Typical meter operates at 70 times less than FCC limit and 3,500 times less than the demonstrated hazard level 6. Non-‐thermal Effects -‐ Inconclusive research to date -‐ No established cause-‐and-‐effect pointing to negative health impacts Continuing research needed make knowledgeable judgments about how to prudently minimize possible risks to themselves and their families by utilizing standards-‐ compliant devices at known safe distances. Also, people will be better able to gauge relative field strengths of various RF sources in our everyday environment (e.g., mobile phones, electric blankets, clock radios, TV and radio, computers, smart meters, power lines, microwave ovens, etc.). An ongoing regularly updated source of unbiased information on the state of scientific research, both proven and as-‐yet-‐unproven causal effects being studied, if presented by an independent entity, would provide consumers a credible and transparent source from which to obtain facts about RF in our environment. CCST is not currently aware of a single website with up-‐to-‐date consumer information which we are able to endorse as impartial. Alternatives to Wireless? Assembly Member Huffman has inquired about potential alternatives to wireless communication with smart meters. There are currently several other methods of transmitting data from some smart meters to the utility company. These methods include transmitting over a power line or wired through phone lines, fiber-‐optic or coaxial cable. Each method has tradeoffs among cost and performance (e.g., how much data can be carried, how far, how fast). The ability to have a transmission protocol alternative to wireless depends upon the type and configuration of the meter used. Some existing smart meters can be hard-‐wired, while others would have to be modified or replaced. The communications board plugs into a digital meter. The current PG&E meters use a SilverSpring communications board that only supports wireless protocol. SilverSpring or another vendor could provide an alternative communications means if such were warranted and cost effective. The related costs of an alternative approach would need to be factored into the decision making process related to different options. If future research were to establish a causal relationship between RF emissions and negative human health impacts, industries and governments worldwide may be faced with difficult choices about practical alternatives to avoid and mitigate such effects. This would greatly affect the widespread use of mobile phones, cordless phones, Wi-‐Fi devices, smart meters, walkie-‐talkies, microwave ovens, and many other everyday appliances and devices emitting RF. If such a hypothetical scenario were to occur, smart meters could conceivably be adapted to non-‐wireless transmission of data. However, retrofitting millions of smart meters with hard-‐ wired technology could be difficult and costly. Perhaps more importantly, retrofitting smart a multifamily building, such as an apartment house. The exposure level was equivalent to 8% of the FCC standard. In the same study EPRI measured exposure of one meter from eight inches behind the meter panel box in order to simulate proximity on the opposite site of the meter wall. At 5% duty cycle it yielded an exposure of only 0.03% of the FCC standard. Even at 100% duty cycle (i.e., always transmitting), exposure at eight inches behind the meter was 0.6% of the FCC limit. Is the FCC Standard Sufficient to Protect Public Health? The FCC guidelines do provide a significant factor of safety against thermal impacts the only currently understood human health impact that occurs at the power level and within the frequency band that smart meters use. In addition to the factor of safety built into the guidelines, at worst, human exposure to RF from smart meter infrastructure operating at even 50% duty cycle will be significantly lower than the guidelines. While additional study is needed to understand potential non-‐thermal effects of exposure to RF and effects of cumulative and prolonged exposure to several devices emitting RF, given current scientific knowledge the FCC guideline provides an adequate margin of safety against known thermal effects. Are Additional Technology-‐specific Standards Needed? The FCC guidelines protect against thermal effects of RF exposure. Many non-‐thermal effects have been suggested, and additional research is needed to better understand and scientifically validate them. Given the scientific uncertainty around non-‐thermal effects of all RF emitting equipment, at this time there is no clear indication of what, if any, additional standards might be needed. Neither is there a basis from which to understand what types of standards could be helpful or appropriate. Without a clear understanding of the biological mechanisms at play, the costs and benefits of additional standards for RF emitting devices including smart meters, cannot be determined at this time. 35 EPRI (2010) “A perspective on radio-‐frequency exposure associated with residential automatic meter reading technology,” Electric Power Research Institute, February. cycle, or signal duration is an often-‐overlooked factor when comparing exposures from different kinds of devices (e.g., mobile phones, Wi-‐Fi routers, smart meters, microwave ovens, FM radio/TV broadcast signals). Duty cycles of various devices vary considerably. The duty cycle of AM/FM radio/TV broadcasts, are 100%; in other words, they are transmitting continuously. Mobile phones usage varies widely from user to user, of course. However, the national average use is about 450 minutes per month. This usage equates to a 1% duty cycle for the “average” user. From information that CCST was able to obtain we understand that the smart meter transmitter being used by PG&E operates with a maximum power output of 1 W (watt) and within the 902-‐928 MHz (mega-‐hertz) frequency band. Each smart meter is part of a broader “mesh” network and may act as a relay between other smart meters and utility access points. The transmitter at each smart meter will be idle some of the time, with the percent of time idle (not transmitting) depending on the amount and schedule of data transmissions made from each meter, the relaying of data from other meters that an individual meter does, and the networking protocol (algorithm) that manages control and use of the communications paths in the mesh network. Theoretically the transmit time could increase substantially beyond today’s actual operation level if new applications and functionality are added to the meter’s communication module in the future. For a hypothetical “worst case” illustration (i.e., if the meter malfunctioned and was stuck in the transmit mode), an absolute upper end duty cycle would be 100%, where the transmitter is always on. The table below compares the effect of different duty cycles against the FCC guidelines for human exposure limits. Typical Smart Meter Operation With Repeater Activity Scaled Hypothetical Maximum Use Case (i.e., always on) 5% Duty Cycle 100% Duty Cycle 72 minutes/day 24 hours/day 3% of FCC limit 60% of FCC limit Source data on operating duty cycles (i.e., first column) from Electric Power Research Institute (EPRI) actual field testing of smart meters, as reported in Radio Frequency Exposure Levels from Smart Meters, November 2010. Second column hypothetical maximum case derived through extrapolation of first column data. Both exposure levels at 1 foot distance. In summary, the duty cycles of smart meters in typical meter-‐read operation and added maximum-‐case repeater operation result in exposures that are 3% of the FCC exposure guidelines. Even in a hypothetical always-‐on scenario the maximum exposure would be about 60% of the FCC limit, which provides a wide safety margin from known thermal effects of RF emissions. 1% of population) 0.000005 (50% of population) Far from source (in most cases) Constant Relatively uniform Smart meter 900 MHz, 2400 MHz 0.0001 (250 mW, 1% duty cycle) 0.002 (1 W, 5% duty cycle) 0.000009 (250 mW, 1% duty cycle) 0.0002 (1 W, 5% duty cycle) 3 feet 10 feet When in proximity during transmission Localized, non-‐ uniform Source: Electric Power Research Institute (EPRI), Radio Frequency Exposure Levels from Smart Meters (November 2010) and converted from mW/cm2. Smart meter figures represent 100% duty cycle (i.e., always on) as hypothetical maximum use case. 31 “Radio-‐Frequency Exposure Levels from Smart Meters”, white paper by Rob Kavet and Gabor Mezei of the Electric Power Research Institute (EPRI). November 2010. 32 Foster, K.R. (2007) Radiofrequency exposure from wireless LANS utilizing WI-‐FFI technology. Health Physics, Vol. 92, No. 3, March, pp. 280-‐282. 33 Schmidt, G. et al. (2007) Exposure of the general public due to wireless LAN applications in public Places, Radiation Protection Dosimetry, Vol. 123, No. 1, Epub June 11, pp. 48-‐52. 34 EPA (1986) The Radiofrequency Radiation Environment: Environmental Exposure Levels and RF Radiation Emitting Sources, EPA 520/1-‐85-‐014, U.S. Environmental Protection Agency, July. 0 Minimum Maximum 1000 500 2000 1500 3000 2500 4000 3500 5000 4500 1000 50 40 4 0.2 0.005 5000 200 40 4 1 1 Devices Health concerns surrounding RF from smart meters are similar to those from many other devices that we use in our daily lives, including cordless and mobile telephones, microwave ovens, wireless routers, hair dryers, and wireless-‐enabled laptop computers. In addition to slight differences in frequency and power levels, which affect human absorption of RF from these devices, the primary difference among them is how they are used. Cell phones, for example, are often used for many minutes at a time, several times over the course of a day, and held directly next to one’s head. For perspective, microwave ovens operate at a similar frequency as the HAN transmitter of smart meters (2.45 GHz), and the U.S. Food and Drug Administration has set limits on leakage levels that are five times higher (5,000 μW /cm2) than the FCC limit for smart meters and other devices 29 EPRI (2010) operating “Radio Frequency at 2.4 GHz. Exposure 30 Wireless Levels routers from Smart and Meters, Wi-‐Fi ” equipment Electric Power produce Research radiofrequency Institute, November 2010. 30 FDA, “Summary of the Electronic Product Radiation Control Provisions of the Federal Food, Drug, and Cosmetic Act,” U.S. Food and Drug Administration. (http://www.fda.gov/Radiation-‐ EmittingProducts/ElectronicProductRadiationControlProgram/LawsandRegulations/ucm118156.htm) 180 20 1.8 0.2 0.018 0 20 40 60 80 100 120 140 160 180 1 3 10 30 100 μW/cm2 Distance in Feet was stuck in the always-‐on transmit mode (i.e., 100% duty cycle), exposure levels would be 60% of the FCC limit for an AMR transmitter. For a 250mW HAN transmitter at a 5% duty cycle, the level would be .45% of the FCC limit and 9% of the FCC limit if the transmitter were on 100%. Exposure figures derived from November 2010 Electric Power Research Institute (EPRI) field measurement study entitled “Radio Frequency Exposure Levels from Smart Meters”.28 Power Density (and Exposure Level) Declines Rapidly with Distance The power density from smart meters, or other devices that emit RF, falls off dramatically with distance. Figure 6 illustrates this affect for an example smart meter. While the estimated maximum exposure level at 1 foot from the meter with a duty cycle of 50% is 180 μW/cm2 (far below the FCC guidelines), at a distance of about 10 feet, the power-‐density exposure approaches zero. 28 EPRI (2010) “Radio Frequency Exposure Levels from Smart Meters,” Electric Power Research Institute, November 2010. 0 200 400 600 800 1000 1200 0 500 1000 1500 2000 2500 Max. permissible exposure (MPE) (μW/cm2 ) Frequency (MHz) FCC Limit If on 50% Max exposure from smart meter HAN transmi�er at 5%, 50% and 100% duty cycle FCC Limit 100% if always on Max exposure from smart meter AMR transmi�er at 5% duty cycle smart meter network it is noted that the FCC limits on MPE include a factor of safety, and the perceived hazardous exposure level is 50 times higher than the FCC limits.26 The study estimates that the highest exposure from smart meters, if an individual were standing directly in front of and next to the meter, would be 8.8 μW/cm2 transmitting at 2 to 4% of the time. The study notes that this is almost 70 times less than the FCC limit and 3,500 times less than the demonstrated hazard level. In all likelihood, individuals will be much farther away from smart meters and likely behind them, (within a structure) where power density will be much lower. The highest exposure from the entire smart meter system would occur immediately adjacent to an access point. It is very unlikely that an individual would be immediately adjacent to an access point, as they are normally located 25 feet above the ground on a telephone or electrical pole or other structure. The peak power density from an access point is estimated to be 24.4 μW/cm2, or about 25 times less than the FCC limit. From the ground, exposure to power density from access points is estimated to be 15,000 times less than the FCC limit in great part due to the distance from the device. The PG&E commissioned report by Richard Tell Associates is based only on an AMR duty cycle of transmitting data once every four hours which results in this very low estimated peak power. However, we are not aware of the justification for using averaging over a four-‐hour period. We do know the FCC27 allows averaging of exposure over a designated period (30 minutes). To truly be a smart grid the data will be transmitted at a much more frequent rate than this. In this report we look at the worst-‐case scenario, a meter that is stuck in the “on” position, constantly relaying, at a 100% duty cycle. Even in this 100% scenario the RF emissions would be measurably below the FCC limits for thermal effects. 26 Tell, R. (2008) “Supplemental Report on An Analysis of Radiofrequency Fields Associated with Operation of the PG&E Smart Meter Program Upgrade System,” Prepared for Pacific Gas & Electric Company, Richard Tell Associates, Inc., October 27. (http://www.pge.com/includes/docs/pdfs/shared/edusafety/systemworks/rfsafety/rf_fields_supplemental_report _2008.pdf) 27 http://www.fcc.gov/Bureaus/Engineering_Technology/Documents/bulletins/oet56/oet56e4.pdf phones, that are used in close proximity to human tissue.19 The FCC limits, as well as the underlying ANSI and NCRP limits, are based on a SAR threshold of 4 W/kg. At the time of the FCC rulemaking, and still today, behavioral disruption in laboratory animals (including non-‐ human primates) at this absorption rate is the only adverse health impact that has been clearly linked to RF at levels similar to those emitted by smart meters. This finding is supported in scientific literature20, 21 and by the World Health Organization and many health agencies in Europe.22, 23 The FCC limit of 1.6 W/kg provides a significant factor of safety against this threshold. Limits on SAR provide the basis for another measurement of exposure, maximum permissible exposure (MPE). MPE limits average exposure over a given time period (usually 30 minutes for general exposure) from a device and is often used for exposure to stationary devices and where human exposure is likely to occur at a distance of more than 20 cm. It is measured in micro (106) watts-‐per-‐square-‐centimeter (μW/cm2), and accounts for the fact that the human body absorbs energy more efficiently at some radiofrequencies than others. The human body absorbs energy most efficiently in the range of 30-‐300 MHz, and the corresponding MPE limits for RF emissions in this range are consequently the most stringent. In the frequency bands where smart meters operate, including PG&E’s, namely the 902-‐928 MHz band and 2.4 GHz range, the human body absorbs energy less efficiently, and the MPE limits are less restrictive. The FCC limits on MPE are summarized in Figure 5.24, 25 At 902 MHz, appropriate for operation of 19 FCC the ( AMR 2001) “Additional transmitter Information of the smart for Evaluating meter, Compliance the FCC limit of Mobile is 601 and μW/ Portable cm2. Devices At higher with frequencies, FCC Limits for Human Exposure to Radiofrequency Emissions,” Supplement C (Edition 01-‐01) to OET Bulletin 65 (Edition 97-‐01), Federal Communications Commission, June. (http://www.fcc.gov/Bureaus/Engineering_Technology/Documents/bulletins/oet65/oet65c.pdf) 20 D'Andrea, J.A., Adair, E.R., and J.O. de Lorge (2003) Behavioral and cognitive effects of microwave exposure, Bioelectromagnetics Suppl 6, S39-‐62 (2003). 21 Sheppard, A.R, Swicord, M. L., and Q. Balzano (2008) Quantitative evaluations of mechanisms of radiofrequency interactions with biological molecules and processes, Health Phys 95, 365-‐96 (2008). 22 The World Health Organization has reviewed international guidelines for limiting radiofrequency exposure and scientific studies related to human health impacts and concludes that exposure below guideline limits don’t appear to have health consequences. (http://www.who.int/peh-‐emf/standards/en/) 23 Committee on Man and Radiation (COMAR) (2009) “Technical Information Statement: Expert reviews on potential health effects of radiofrequency electromagnetic fields and comments on The Bioinitiative Report,” Health Physics 97(4):348-‐356 (2009). 24 FCC (1997) “Evaluating Compliance with FCC Guidelines for Human Exposure to Radiofrequency Electromagnetic Fields,” OET Bulletin 65 (Edition 97-‐01), Federal Communications Commission, August. (http://www.fcc.gov/Bureaus/Engineering_Technology/Documents/bulletins/oet65/oet65.pdf) 25 FCC (1999) “Questions and Answers about Biological Effects and Potential Hazards of Radiofrequency Electromagnetic Fields," OET Bulletin 56 (Fourth Edition), Federal Communications Commission, August. (http://www.fcc.gov/Bureaus/Engineering_Technology/Documents/bulletins/oet56/oet56e4.pdf) to base acceptable human RF exposure limits on currently proven scientific and engineering findings on known thermal effects, rather than on general concerns or speculation about possible unknown and as yet unproven non-‐thermal effects. Such questions will likely take considerable time to resolve. The data that are available strongly suggest that if there are non-‐thermal effects of RF absorption on human health, such effects are not so profound as to be easily discernable. FCC Guidelines Address Known Thermal Effects Only, not Non-‐thermal Effects In 1985, the FCC first established guidelines to limit human exposure and protect against thermal effects of absorbed RF emissions. The guidelines were based on those from the American National Standards Institute (ANSI) that were issued in 1982.13 In 1996, the FCC modified its guidelines,14 based on a rulemaking process that began in 1993 in response to a 1992 revision of the ANSI guidelines15, 16 and findings by the National Council on Radiation Protection and Measurements (NCRP).17 The 1996 guidelines are still in place today. In its rulemaking process to set SAR and MPE limits, the FCC relied on many federal health and safety agencies, including the U.S. Environmental Protection Agency and the Food and Drug Administration. While the FCC guidelines appear to provide a large factor of safety against known thermal effects of exposure to radiofrequency, they do not necessarily protect against potential non-‐thermal effects, nor do they claim to.18 Without additional understanding of these effects, there is inadequate basis to develop additional guidelines at this time. 12 National Research Council (2008) Identification of Research Needs Relating to Potential Biological or Adverse Health Effects of Wireless Communication, The National Academies Press, Washington, D.C. (http://www.nap.edu/catalog/12036.html) 13 American National Standards Institute (1982) “American National Standard Radio Frequency Radiation Hazard Warning Symbol,” ANSI C95.2-‐1982, Institute of Electrical and Electronics Engineers, Inc. 14 FCC (1997) “Evaluating Compliance with FCC Guidelines for Human Exposure to Radiofrequency Electromagnetic Fields,” OET Bulletin 65 (Edition 97-‐01), Federal Communications Commission, August. (http://www.fcc.gov/Bureaus/Engineering_Technology/Documents/bulletins/oet65/oet65.pdf) 15 American National Standards Institute (1992) “Safety Levels with Respect to Human Exposure to Radio Frequency Electromagnetic Fields, 3 kHz to 300 GHz,” ANSI/IEEE C95.1-‐1992 (previously issued as IEEE C95.1-‐1991), Institute of Electrical and Electronics Engineers, Inc. 16 American National Standards Institute (1992) “Recommended Practice for the Measurement of Potentially Hazardous Electromagnetic Fields – RF and Microwave,” ANSI/IEEE C95.3-‐1992, Institute of Electrical and Electronics Engineers, Inc. 17 NCRP (1986) “Biological Effects and Exposure Criteria for Radiofrequency Electromagnetic Fields,” NCRP Report No. 86 (1986), National Council on Radiation Protection Measurements. 18 The U.S. EPA confirmed this in a letter to The Electromagnetic Radiation Policy Institute, dated March 8, 2002. (http://www.emrpolicy.org/litigation/case_law/docs/noi_epa_response.pdf) Any difference in health impacts from these devices is likely to be a result of differences in usage patterns among them. Thermal Effects Electromagnetic waves carry energy, and EMF absorbed by the body can increase the temperature of human tissue. The scientific consensus is that body temperatures must increase at least 1oC to lead to potential biological impacts from the heat. The only scientifically verified effect that has been shown to occur in the power and frequency range that smart meters are designed to occupy is a disruption in animal feeding behavior at energy exposure levels of 4 W/kg and with an accompanying increase in body temperature of 1oC or more.7 The exposure levels from smart meters even at close range are far below this threshold. The FCC has set limits on power densities from electronic devices that are well below the level where demonstrated biological impacts occur, and the limits are tens or hundreds of times higher than likely exposure from smart meters.8 Non-‐thermal Effects There are emerging questions in the medical and biological fields about potential harmful effects caused by non-‐thermal mechanisms of absorbed RF emissions. Complaints of health impacts from “electromagnetic stress” have been reported, with symptoms including fatigue, headache, and irritability. Some studies have suggested that RF absorption from mobile phones may disrupt communication between human cells, which may lead to other negatives impacts on human biology.9,10 While concerns of brain cancer associated with mobile phone usage persist, there is currently no definitive evidence linking cell phone usage with increased incidence of cancer.11 But due to the recent nature of the technology, impacts of long-‐term exposure are not known. Ongoing scientific study is being conducted to understand non-‐ thermal 7 D'Andrea, effects J.A., Adair, from E.R. long-‐, and term J.O. de exposure Lorge (2003) to Behavioral mobile phones and cognitive and smart effects meters, of microwave etc., exposure, especially Bioelectromagnetics Suppl 6, S39-‐62 (2003). 8 Tell, R. (2008) “Supplemental Report on An Analysis of Radiofrequency Fields Associated with Operation of the PG&E Smart Meter Program Upgrade System,” Prepared for Pacific Gas & Electric Company, Richard Tell Associates, Inc., October 27. (http://www.pge.com/includes/docs/pdfs/shared/edusafety/systemworks/rfsafety/rf_fields_supplemental_report _2008.pdf) 9 Markova, E., Malmgren, L., and I.Y. Belyaev (2009) Microwaves from mobile phones inhibit 53PB1 focus formation in human stem cells stronger than in differentiated cells: Possible mechanistic link to cancer risk. Environmental Health Perspectives, doi:10.1289/ehp.0900781. 10 Nittby, H., Grafstrom, G., Eberhardt, J.L., Malmgren, L., Brun, A., Persson B.R.R., and L.G. Salford (2008) Radiofrequency and Extremely Low-‐Frequency Electromagnetic Field Effects on the Blood-‐Brain Barrier Electromagnetic Biology and Medicine, 27: 103–126, 2008. 11 Ahlbom, A., Feychting, M., Green, A., Kheifets, L., Savitz, D. A., and A. J. Swerdlow (2009) Epidemiologic evidence on mobile phones and tumor risk: a review. Epidemiology 20, 639-‐52 (2009). countries around the world are actively deploying smart meters as well. Digital smart meters are generally considered to be the fundamental technology required to enable widespread integration of information technology (IT) into the power grid (i.e., the smart grid). The following table (table 1) summarizes some potential societal benefits expected to result from the smart grid. Table 1: Smart Grid Benefits Consumers 1. Cost Savings Resulting from Energy Efficiency 2. Increased Consumer Choice and Convenience 3. More Transparent, Real-‐Time Information and Control for Consumers Environment 1. Widespread Deployment of Renewable Energy (Solar, Wind, Biofuels) and Electric Vehicles (EVs) 2. Reduced Need to Build More Fossil Fueled Power plants 3. Reduced Carbon Footprint and Other Pollutants (via Renewables, Energy Efficiency, Electric Vehicles) Utilities 1. Reduced Cost Due to Increased Efficiencies in Delivering Electricity and Reduction in Manpower to Read Meters. 2. Improved Reliability and More Timely Outage Response 3. Increased Customer Satisfaction Due to Cost Savings and Self-‐Control Source: California Smart Grid Center Economy 1. Creates New Market for Goods and Services (i.e., New Companies, New Jobs) 2. Up-‐skilling Workforce to be Prepared for New Jobs 3. Reduced Dependence on Foreign Oil, Keeps Dollars at Home What Health Concerns are Associated with Smart Meters? Human health impacts from exposure to electromagnetic frequency (EMF) emissions vary depending on the frequency and power of the fields. Smart meters operate at low power and in 5 The the federal RF portion Energy of Independence the electromagnetic and Security Act spectrum. of 2007 directs At these states levels, to encourage RF emissions utilities to from initiate smart smart grid programs, allows recovery of smart grid investments through utility rates, and reimburses 20% of qualifying smart grid investments. The American Recovery and Reinvestment Act of 2009 provided $4.5 billion to develop smart grid infrastructure in the U.S. For more information, see: Congressional Research Service (2007) “Energy Independence and Security Act of 2007: A Summary of Major Provisions,” CRS Report for Congress, Order Code RL34l294, December 21. (http://energy.senate.gov/public/_files/RL342941.pdf) 6 California Public Utilities Commission decision on Application 07-‐12-‐009 (March 12, 2009). Decision on Pacific Gas and Electric Company’s Proposed Upgrade to the Smartmeter Program. HAN, can delay non-‐time sensitive demands (such as clothes drying) to a time when electricity is cheapest or has the most benefit to the reliability of the system. In some cases wireless signals interior to the structure will also be able to automatically adjust the heating and ventilation systems and to adjust heat or air conditioning units. This adaptation to price or reliability signals could reduce overall electricity costs for customers, improve the utilization of renewable and non-‐renewable power plants, and cut costs associated with adding intermittent wind and solar resources to the grid. While such long-‐term value of smart meters will take years to fully realize, they are sufficiently promising that the federal government has required utilities to take steps to implement smart 4 See http://www.silverspringnet.com/products/index.html for component descriptions. Network infrastructure includes the Silver Spring Access Points (APs) and Relays that forward data from endpoints across the utility’s backhaul or WAN infrastructure into the back office. The UtilityIQ application suite incorporates both utility applications such as Advanced Metering and Outage Detection as well as administrative programs for managing and upgrading the network. GridScape provides management for DA communications networks. The CustomerIQ web portal enables utilities to directly communicate usage, pricing, and recommendations to consumers. Silver Spring works with each utility to customize the information portrayed and to import utility-‐ specific information such as rate schedules. These access points are designed to transmit data from up to 5,000 smart meters to the utility company. Access points have a similar AMR transmitter as smart meters, as well as an additional AirCard, which communicates with utilities and is similar to wireless cards used in laptop computers. AirCards typically operate at 0.25-‐1 W, in the 800-‐ 900 MHz or 1.9 GHz range. In some cases, data is moved through the mesh network, relaying the data through other meters to the utility access point. This may occur when the topography or built environment interferes with the transmission of data from a smart meter to the access point. In these cases, the relaying of data may occur between one smart meter and another before the signal is sent to the utility access point (e.g., hops along a set of meters). Additionally, some non-‐meter data relays will also exist in the system to connect some smart meters to utility access points. Many smart meters, including those from PG&E, also have a second transmitter that, at some future point in time, will allow customers to enable a home access network (HAN). The HAN will allow increased consumer monitoring of electricity use and communication among appliances and the future smart grid. This functionality is important to achieve the full potential of the smart grid. This second internal transmitter, for delivery of smart meter data to the consumer, reportedly will operate at a rated power of 0.223W, at frequency of about 2.4 GHz (again, similar to that of cell phones and wireless phones). The actual duty cycle of this transmitter will depend on the design and operation of the home area network. Why are Smart Meters Being Installed Throughout California? It is anticipated, when fully operational, that smart electricity meters are a key enabling technology for a “smart grid” that is expected to become increasingly clean, efficient, reliable, and safe (see Figure 3) at a potential lower cost to the consumer. (Digital meters are also being used for reading of natural gas and water consumption). Smart electrical meters allow direct two-‐way communication between utilities and customers, which is expected to help end users adjust their demand to price changes that reflect the condition of the electricity grid. These end user adjustments can help to protect the overall reliability of the electricity grid, cut costs for utility customers, and improve the operation and efficiency of the electricity grid. The smart grid will enable grid operators to better balance electricity supply and demand in real-‐time, which becomes increasingly important as more intermittent wind and solar generation resources are added to the grid. Figure 4 depicts the potential operation of a smart grid. real time monitoring of power as delivered to the consumer by the utility company. CCST obtained from PG&E the Richard Tell Associates report, which describes the operation of the smart meter from the 2008 perspective of AMR, not a fully deployed real time smart grid. The Richard Tell Associates reports describe the use of the smart meter radios being deployed by PG&E as licensed by the FCC for a maximum power output of 1 W (watt) and within the 902-‐ 928 MHz (mega-‐hertz) frequency band. In its initial deployment, PG&E reports that it will configure the radios to transmit data from the meter to the access point once every four hours, for about 50 milliseconds at a time.3 Accounting for this, the current duty cycles of the smart meter transmitter (that is, the percent of time that the meter operates) would then typically be 1 percent, or in some cases where the meter is frequently used as a relay, as much as 2-‐4 percent. This means that the typical smart meter in this initial (AMR) use would not transmit any RF signal at least 96-‐98 percent of the time. It is important to note that any one smart meter is part of a broader “mesh” network and may act as a relay among other smart meters and utility access points. In addition, when the smart grid is fully functional the smart meters would be expected to be transmitting much more than once 3 Tell, R. every (2008) four “Supplemental hours, providing Report on data An Analysis in near of real-‐ Radiofrequency time, which Fields will Associated result in with a much Operation higher of duty the PG&E Smart Meter Program Upgrade System,” Prepared for Pacific Gas & Electric Company, Richard Tell Associates, Inc., October 27. http://www.pge.com/includes/docs/pdfs/shared/edusafety/systemworks/rfsafety/rf_fields_supplemental_report _2008.pdf) reduce operating costs for utilities, and potentially, costs for customers (see Figure 2). a. Analog Meter b. Digital Meter Figure 2. a) An analog, conventional meter and a (b) digital smart meter (Source: PG&E) Each of California’s major electricity utilities has begun deploying smart meter infrastructure. There are many kinds of smart meters manufactured by a variety of companies. The meter, including sensors and the housing or casing, may be manufactured by one company while the communications device (installed within the meter) is manufactured by another. Depending upon the internal communications device employed, meters are configured to operate in a wired or in wireless environment. The smart meters used by PG&E are made by General Electric and Landis + Gyr and use a wireless communications technology from Silver Spring Networks. Each of these PG&E meters has two transmitters to provide two different communications of data from these meters.2 The first provides for the “automatic meter reading” (AMR) function of the meter (and for more detailed and real time monitoring of the characteristics of the electrical energy delivered to the consumer) and sends this data to an access point, where it is collected along with data from many other customers and transmitted to PG&E using a wireless area network (WAN) (similar to the way cell phone communication works). 2 Tell, R. (2008) “Supplemental Report on An Analysis of Radiofrequency Fields Associated with Operation of the PG&E Smart Meter Program Upgrade System,” Prepared for Pacific Gas & Electric Company, Richard Tell Associates, Inc., October 27. is needed to better understand and verify these potential mechanisms. Given the existing significant scientific uncertainty around non-‐thermal effects, there is currently no generally accepted definitive, evidence-‐based indication that additional standards are needed. Because of the lack of generally accepted evidence, there is also not an existing basis from which to understand what types of standards could be helpful or appropriate. Without a clearer understanding of the biological mechanisms involved identifying additional standards or evaluating the relative costs and benefits of those standards cannot be determined at this time. CCST notes that in some of the studies reviewed, contributors have raised emerging questions from some in the medical and biological fields about the potential for biological impacts other than the thermal impact that the FCC guidelines address. A report of the National Academies identifies research needs and gaps and recommended areas of research to be undertaken to further understanding of long-‐term exposure to RF emissions from communication devices, particularly from non-‐thermal mechanisms that are not currently addressed by the FCC guidelines.1 In our increasingly wireless society, smart meters account for a very small portion of RF emissions to which we are exposed. Concerns about human health impacts of RF emissions from smart meters should be considered in this broader context. “Scientifically established”, “generally accepted scientific knowledge” and other such references throughout this document are referencing information obtained through the scientific method. A scientific method consists of the collection of data through observation and experimentation, and the formulation and testing of hypotheses. These steps must be repeatable in order to predict future results. Scientific inquiry is generally intended to be as objective as possible, to reduce biased interpretations of results. Another basic expectation is to document, archive and share all data and methodology so they are available for careful scrutiny by other scientists, giving them the opportunity to verify results by attempting to reproduce them. This practice, called full disclosure, also allows statistical measures of H ealth concerns the reliability surrounding of these data RF to from be established. smart meters are similar to those from many other devices that we use in our daily lives, including cordless and cellular telephones, microwave ovens, wireless routers, hair dryers, and wireless-‐enabled laptop computers. As detailed in the report, a comparison of electromagnetic frequencies from smart meters and other devices shows that the exposure level is very low. 1 National Research Council (2008) Identification of Research Needs Relating to Potential Biological or Adverse Health Effects of Wireless Communication, The National Academies Press, Washington, D.C. has established guidelines to protect public health from known hazards associated with the thermal impacts of RF: tissue heating from absorbing energy associated with radiofrequency emissions. Non-‐thermal effects, however, including cumulative or prolonged exposure to lower levels of RF emissions, are not well understood. Some studies have suggested non-‐thermal effects may include fatigue, headache, irritability, or even cancer. But these findings have not been scientifically established, and the mechanisms that might lead to non-‐thermal effects remain uncertain. Additional research and monitoring is needed to better identify and understand potential non-‐thermal effects. Findings Given the body of existing, generally accepted scientific knowledge regarding smart meters and similar electronic devices, CCST finds that: 1. The FCC standard provides an adequate factor of safety against known thermally induced health impacts of smart meters and other electronic devices in the same range of RF emissions. The potential for behavioral disruption from increased body tissue temperatures is the only biological health impact that has been consistently demonstrated and scientifically proven to result from absorbing RF within the band of the electromagnetic spectrum (EMF) that smart meters use. The Federal Communications Commission (FCC) has set a limit on the Standard Absorption Rate (SAR) from electronic devices, which is well below the level that has been demonstrated to affect behavior in laboratory animals. Smart meters, including those being installed by Pacific Gas and Electric Company (PG&E) in the Assembly Members’ districts, if installed according to the manufacturers instructions and consistent with the FCC certification, emit RF that is a very small fraction of the exposure level established as safe by the FCC guidelines. The FCC guidelines provide a significant factor of safety against thermal impacts that occur at the power levels and within the RF band used by smart meters. Given current scientific knowledge, the FCC guideline provides a more than adequate margin of safety against the known thermal effects. Monning signed onto the request with his own letter to CCST on September 15, 2010. The City of Mill Valley also sent a letter on September 20th supporting Assembly Member Huffman’s request for the study. Approach Reflecting the requests of the Assembly Members, CCST agreed to compile and assess the evidence available to address: 1. Whether Federal Communications Commission (FCC) standards for smart meters are sufficiently protective of public health, taking into account current exposure levels to radiofrequency and electromagnetic fields. 2. Whether additional technology-‐specific standards are needed for smart meters and other devices that are commonly found in and around homes, to ensure adequate protection from adverse health effects. CCST convened a Smart Meter Project Team composed of CCST Council and Board members supplemented with additional experts in relevant fields (see Appendix A for Project Team members). The Project Team identified and reviewed over 100 publications and postings about smart meters and other devices in the same range of emissions, including research related to cell phone RF emissions, and contacted over two dozen experts in radio and electromagnetic emissions and related fields to seek their opinion on the two identified issues. It is important to note that CCST has not undertaken primary research of its own to address these issues. This response is limited to soliciting input from technical experts and to reviewing and evaluating available information from past and current research about health impacts of RF emitted from electric appliances generally, and smart meters specifically. A subset of those contacted provided written input on the issues to CCST. This report has been extensively reviewed by the Project Team, experts in related fields, and has been subject to the CCST peer review process (see Appendix B). It has also been made available to the public for comment. 40 4 1 1 FCC standard provides an adequate factor of safety against known thermally induced health impacts of existing common household electronic devices and smart meters. 3. To date, scientific studies have not identified or confirmed negative health effects from potential non-‐thermal impacts of RF emissions such as those produced by existing common household electronic devices and smart meters. 4. Not enough is currently known about potential non-‐thermal impacts of radio frequency emissions to identify or recommend additional standards for such impacts OTHER CONSIDERATIONS Smart electricity meters are a key enabling technology for a “smart grid” that is expected to become increasingly clean, efficient, reliable, and safe at a potentially lower cost to the consumer. The CCST Smart Meter Project Team offers the following for further consideration by policy makers, regulators and the utilities. We appreciate that each of these considerations would likely require a cost/benefit analysis. However, we feel they should be considered as the overall cumulative exposure to RF emissions in our environment continues to expand. 1. As wireless technologies of all types increase in usage, it will be important to: (a) continue to quantitatively assess the levels of RF emissions from common household devices and smart meters to which the public may be exposed; and (b) continue to investigate potential thermal and non-‐thermal impacts of such RF emissions on human health. 2. Consumers should be provided with clearly understood information about the radiofrequency emissions of all devices that emit RF including smart meters. Such information should include intensity of output, duration and frequency of output, and, in the cases of the smart meter, pattern of sending and receiving transmissions to and from all sources. 3. The California Public Utilities Commission should consider doing an independent review of the deployment of smart meters to determine if they are installed and operating consistent with the information provided to the consumer. 4. Consideration could be given to alternative smart meter configurations (such as wired) in those cases where wireless meters continue to be concern to consumers. that is agile, efficient and cost effective. The electricity crisis of 2000 and 2001 helped force the issue here in California, lending significant urgency to the need for better management of power generation and distribution. In 2006, the California Public Utilities Commission authorized the Pacific Gas and Electric Company to implement a relatively new technology, smart meters, to gather much more precise information about power usage throughout the state. The process of installing the meters throughout the state is still underway. As with any new technology, there are unknowns involved. Smart meters generally work by transmitting information wirelessly. Some people have expressed concerns about the health effects of wireless signals, particularly as they become virtually ubiquitous. These concerns have recently been brought to the attention of state legislators, with some local municipalities opting to ban further installation of the meters in their communities. We are pleased that Assembly Members Huffman and Monning have turned to CCST for input on this issue. It is CCST’s charge to offer independent expert advice to the state government and to recommend solutions to science and technology-‐related policy issues. In this case, we have assembled a succinct but comprehensive overview of what is known about human exposure to wireless signals and the efficacy of the FCC safety standards for these signals. To do so, we assembled a project team that consulted with over two dozen experts and sifted through over a hundred articles and reports, providing a thorough, unbiased overview in a relatively rapid manner. In situations where public sentiment urges policy makers to make policy decisions with potentially long-‐term consequences, access to the best information possible is critical. This is the role that CCST was created to fulfill. Susan Hackwood Rollin Richmond Executive Director, CCST Project Team Chair, CCST with smart meters? .......................................................... 13 FCC guidelines address known thermal effects only, not non-‐thermal effects ........................... 15 Power density (and exposure level) declines rapidly with distance ............................................ 18 Comparison of electromagnetic frequencies from smart meters and other devices .................. 19 What is duty cycle and how does it affect human health? .......................................................... 22 What about exposure levels from a bank of meters and from just behind the wall of a single meter? ........................................................................................................... 23 Is the FCC standard sufficient to protect public health? .............................................................. 23 Are additional technology-‐specific standards needed? ............................................................... 23 Public information and education ................................................................................................ 24 Alternatives to wireless? .............................................................................................................. 24 Key factors to consider when evaluating exposure to radiofrequency from smart meters? ....... 25 Conclusion .................................................................................................................................... 26 Appendix A – Letters requesting CCST assistance ........................................................................ 27 • Assembly Member Huffman’s Letter ............................................................................... 27 • Assembly Member Monning’s Letter ............................................................................... 29 • City of Mill Valley Letter ................................................................................................... 30 Appendix B – Project Process ....................................................................................................... 32 Appendix C – Project Team .......................................................................................................... 34 Appendix D – Written Submission Authors .................................................................................. 37 Appendix E – Materials Consulted ............................................................................................... 38 Appendix F – Glossary .................................................................................................................. 45 Appendix G – CCST 2010 Board Members ................................................................................... 47 Appendix H – CCST 2010 Council Members ................................................................................. 48 Appendix I – Report Credits ......................................................................................................... 49 University, Sacramento and to the University of California’s Center for Information Technology Research in the Interest of Society (CITRIS). This report was conducted with the oversight of a CCST Smart Meter Project Team, whose members include: Rollin Richmond (Chair), Emir Macari, Patrick Mantey, Paul Wright, Ryan McCarthy, Jane Long, David Winickoff, and Larry Papay. We also thank J.D. Stack for his technical contributions and Lora Lee Martin for the overall coordination of this report response. We express gratitude to CCST’s members and colleagues for their many contributions to the report. COPYRIGHT Copyright 2010 by the California Council on Science and Technology. Library of Congress Cataloging Number in Publications Data Main Entry Under Title: Health Impacts of Radio Frequency From Smart Meters January 2011 ISBN-‐13: 978-‐1-‐930117-‐42-‐6 CCST is a non-‐profit organization established in 1988 at the request of the California State Government and sponsored by the major public and private postsecondary institutions of California and affiliate federal laboratories in conjunction with leading private-‐sector firms. CCST's mission is to improve science and technology policy and application in California by proposing programs, conducting analyses, and recommending public policies and initiatives that will maintain California's technological leadership and a vigorous economy. Note: The California Council on Science and Technology (CCST) has made every reasonable effort to assure the accuracy of the information in this publication. However, the contents of this publication are subject to changes, omissions, and errors, and CCST does not accept responsibility for any inaccuracies that may occur. For questions or comments on this publication contact: California Council on Science and Technology 1130 K Street, Suite 280 Sacramento, California 95814 (916) 492-‐0996 ccst@ccst.us r t Ii Mason Corridor, 06-287, 1/5/07