HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 07/03/2018 - FIRST READING OF ORDINANCE NO. 088, 2018, AMENDINGAgenda Item 8
Item # 8 Page 1
AGENDA ITEM SUMMARY July 3, 2018
City Council
STAFF
Mike Beckstead, Chief Financial Officer
Judy Schmidt, Legal
SUBJECT
First Reading of Ordinance No. 088, 2018, Amending Section 2-31 of the Code of the City of Fort Collins
Concerning Executive Sessions Pertaining to Telecommunication Facilities and Services.
EXECUTIVE SUMMARY
The purpose of this item is to update City Code consistent with the November 7, 2017 voter-approved Charter
amendment providing for telecommunication facilities and services (broadband) as part of the City’s Electric
Utility. The Charter amendment also authorized the Council and any board or commission established under
the Charter amendment to go into executive session to consider issues of competition in providing
telecommunication facilities and services. The proposed Ordinance amends City Code Section 2-31 to permit
executive sessions for such purposes.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
BACKGROUND / DISCUSSION
Within the feasibility assessment associated with establishing a municipal broadband service within Fort
Collins, various critical success factors were discussed in detail with council and the community. Chart A
outlines the 4 major critical success factors related to a successful launch of broadband in a
Commercial/Competitive environment vs. the City’s current four single source Utilities.
Commercial / Competitive Single Source Utility
Commercial Objectives Social / Political Objectives
Market-Based Decision Timeliness Slower Decision Timeliness
Strategic Confidentiality Material Public Discussion all Material
Business/Competitive Expertise Business Expertise
Chart A
To avoid a competitive disadvantage for the City’s broadband effort, the ballot language approved by voters on
November 7, 2017, specifically modified the City Charter to allow executive sessions to consider matters
pertaining to competition in the City’s provision of telecommunications facilities and services. Matters
pertaining to competition include, but are not limited to, matters subject to negotiation, strategic planning,
pricing, sales and marketing, development phasing and any other matter allowed under Colorado law under
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the ballot language. The approved Charter language pertaining to executive sessions is listed below. The
complete ballot language is included in Attachment 2.
(d) In addition to the authority to go into executive session as provided in Section 11 of Article II of
this Charter, the Council, and any board or commission established under subsection (e) below, may
go into executive session to consider matters pertaining to issues of competition in providing the
telecommunication facilities and services authorized in this Section, which shall include, without
limitation, matters subject to negotiation, strategic planning, pricing, sales and marketing,
development phasing and any other matter allowed under Colorado law.
Updates to City Code Section 2-31 are required to implement the new Charter language.
The information below outlines the governance and operational authority of both Council and the City
Manager. Council will make decisions and set policy at City Council meetings on topics such as those
highlighted under Governance. Executive sessions will be used to discuss matters where sharing the types of
information specified in the Charter would cause a competitive disadvantage to the broadband effort.
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ATTACHMENTS
1. Agenda Item Summaries re: Proposed Charter Amendment to Add a New Section to Charter Article XII
Pertaining to Telecommunication Facilities and Services, August 8 and August 15, 2017 (PDF)
2. Ordinance No. 101, 2017 (PDF)
Agenda Item 2
Item # 2 Page 1
AGENDA ITEM SUMMARY August 8, 2017
City Council
STAFF
SeonAh Kendall, Economic Health Manager
Mike Beckstead, Chief Financial Officer
SUBJECT
Items Relating to a Proposed Charter Amendment to Add a New Section to Charter Article XII Pertaining to
Telecommunication Facilities and Services.
EXECUTIVE SUMMARY
A. Possible Public Hearing and Motions Regarding Protest(s) of Ballot Language.
B. First Reading of Ordinance No. 101, 2017, Submitting to a Vote of the Registered Electors of the City of
Fort Collins a Proposed Amendment to Article XII of the City Charter to Add a New Section 7 Pertaining to
Telecommunication Facilities and Services.
The purpose of this item is to propose an amendment to Charter Article XII, Municipal Public Utilities. The
amendment would authorize the City Council to provide, by future ordinance, telecommunications/broadband
facilities and services as a public utility, to issue of up to $150 million in bonds, the ability to go into executive
session to discuss matters related to competition in the telecommunications industry, and the option to
establish governance of this public utility through a board and/or to delegate rate-making authority to the City
Manager. This measure does not mandate that the City provide municipal retail broadband services, or that a
third-party be the provider.
Any protest of the proposed ballot language must be received no later than Monday, August 7, 2017, at noon.
The protest(s) shall be heard, considered, and resolved by Council prior to adoption of Ordinance No. 101,
2017. If protest(s) are received, copies will be included in Council’s “Read-before” packet.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
BACKGROUND / DISCUSSION
City Broadband Strategic Objectives
The FCC noted that the real culprit of slow, expensive internet in the U.S. is the lack of competition among
providers. New broadband entrants into the market have a substantial impact on price and service.
The City’s 2016 Strategic Plan includes Strategic Objective 3.9 - “Encourage the development of reliable high
speed internet services throughout the community”. The Broadband Plan overall objective is to bring reliable,
Gig speed internet to the City of Fort Collins, while making an informed decision through evaluation of risk and
opportunities. Broadband is defined by the FCC as internet download speed of 25 megabits per second
(“Mbps”) and upload of 3 Mbps or faster.
Additional benefits sought include:
ATTACHMENT 1
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Competitive pricing (residential market pricing at $70/month or less for 1 Gbps and an affordable internet
tier);
Universal coverage across the Growth Management Area;
Underground service for improved reliability; and
Timely implementation to providing services within a reasonable time frame (less than five years).
At the July 2017 work session, City Council directed staff to continue work on developing the ballot language
and refining the message. The City Attorney’s office, in collaboration with City staff, has prepared the
proposed Charter amendment and ballot question.
Timeline of activity to refer the ballot:
Timeframe Key Activities
August 8, 2017 First Reading of ballot language
August 15, 2017 Second Reading of ballot language; Final date for City Council to adopt the ballot
language
August 29, 2017 Intergovernmental agreement with the County calling the special election
September 8, 2017 City Clerk certification of ballot language
November 7, 2017 Election
November 8, 2017
(If Voter
Disapproval)
Status Quo-No further action
November 8, 2017
(If Voter Approved)
See projected timeline (Attachment 3)
The ballot measure would allow:
Council the ability to add Telecommunication/Broadband services to the City’s electric utility or create a
new utility to provide these services;
Issue securities or debt not to exceed $150M to fund the project;
Establish a governance structure including the ability to: (1) go into executive session for matters relating
to competition;( 2) establish and delegate Council’s authority and power to a board and/or commission,
except the power to issue debt; and (3) delegate the ability to set and/or change rates or fees to the City
Manager.
The ballot measure does not mandate the City to provide municipal retail broadband services, or that a third-
party internet service provider would offer the service. The ballot measure would allow City Council to pursue
broadband services through either option.
Informational materials such as the projected timeline, FAQ, business plan and website were created to inform
the community about the broadband project.
CITY FINANCIAL IMPACTS
The broadband financial feasibility model estimates that the project will cost between $130,000,000 to
$150,000,000. The price range is attributed to the technology selected to implement a municipal broadband
(ActiveE vs. GPON), potential increases to subscribership/take rate, and the product mix (video, voice,
internet). The issuance of securities or other debt would be in an amount not to exceed $150M.
BOARD / COMMISSION RECOMMENDATION
None
Agenda Item 2
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PUBLIC OUTREACH
- Broadband Town Hall - November 14, 2016
- Broadband Technical Group - Oct 20, 2016; Nov 1, 8, and 14, 2016; Dec 14, 2016; Mar 30, 2017; July 17,
2017
- Fort Collins Area Chamber of Commerce Local Legislative Affairs - Dec 16, 2016; March 31, 2017
- Broadband Open House - Oct 12, 2016; Nov 29, 2016
- Leadership Northern Colorado - March 28, 2017
- North Fort Collins Business Association - May 24, 2017
- Broadband Citizen Group - Nov 16, 2016; March 29, 2017; June 21, 2017
- Community Issues Forum - November 17, 2016
- Super Issues Meeting - November 30, 2016
- Economic Advisory Commission (Informational only) - May 17, 2017
ATTACHMENTS
1. Broadband Flyer (PDF)
2. Broadband Business Plan, Version II, July 31, 2017 (PDF)
3. Powerpoint presentation (PDF)
Agenda Item 23
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AGENDA ITEM SUMMARY August 15, 2017
City Council
STAFF
SeonAh Kendall, Economic Health Manager
Mike Beckstead, Chief Financial Officer
John Duval, Legal
SUBJECT
Second Reading of Ordinance No. 101, 2017, Submitting to a Vote of the Registered Electors of the City of
Fort Collins a Proposed Amendment to Article XII of the City Charter to Add a New Section 7 Pertaining to
Telecommunication Facilities and Services.
EXECUTIVE SUMMARY
This Ordinance, adopted on First Reading on August 8, 2017 by a vote of 5-2 (Nays: Martinez, Summers),
submits to Fort Collins electors a proposed amendment to Charter Article XII, Municipal Public Utilities. The
amendment would authorize the City Council to provide, by future ordinance, telecommunications/broadband
facilities and services as a public utility, to issue of up to $150 million in bonds, the ability to go into executive
session to discuss matters related to competition in the telecommunications industry, and the option to
establish governance of this public utility through a board and/or to delegate rate-making authority to the City
Manager. This measure does not mandate that the City provide municipal retail broadband services, or that a
third-party be the provider.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on Second Reading.
ATTACHMENTS
1. First Reading Agenda Item Summary, August 8, 2017 (w/o attachments) (PDF)
2. Staff memo in response to Council questions (PDF)
3. Ordinance No. 101, 2017 (PDF)
ATTACHMENT 2
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ORDINANCE NO. 088, 2018
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AMENDING SECTION 2-31 OF THE CODE OF THE CITY OF FORT
COLLINS CONCERNING EXECUTIVE SESSIONS PERTAINING TO
TELECOMMUNICATION FACILITIES AND SERVICES
WHEREAS, on July 20, 1993, the City Council adopted Ordinance No. 060, 1993
establishing the City’s Electric Utility as an enterprise of the City under Section 20 of Article X
of the Colorado Constitution (the “Electric Utility Enterprise”)
WHEREAS, at a special election on November 3, 2015, City voters authorized the City
to provide high-speed internet services, including, without limitation, high-bandwidth broadband
services, telecommunications services, and/or cable television services within the City’s growth
management area; and
WHEREAS, at a special election on November 7, 2017, City voters approved an
amendment to the City Charter, which has added a new Section 7 to Charter Article XII
(“Section 7”); and
WHEREAS, paragraph (a) of Section 7 grants to the City Council the power, by
ordinance and without a vote of the electors, to authorize the Electric Utility Enterprise to
acquire, construct, provide, fund and contract for “telecommunications facilities and services,”
including, without limitation, “broadband Internet facilities and services,” as both these terms are
defined in paragraph (f) of Section 7 (“Telecommunication Facilities and Services”); and
WHEREAS, on January 16, 2018, the City Council adopted Ordinance No. 011, 2018
amending the City Code by adding a new Section 26-398 to Code Chapter 26 to implement this
authority granted in Section 7 by authorizing the Electric Utility Enterprise to acquire, construct,
provide, fund and contract for Telecommunication Facilities and Services and by authorizing the
Electric Utility Enterprise to exercise the power to issue revenue bonds to fund the provision of
Telecommunication Facilities and Services as provided in paragraph (b) of Section 7; and
WHEREAS, Ordinance No. 011, 2018 also amended Code Sections 2-504 and 26-21 to
delegate to the City Manager the direct responsibility to administer and supervise the Electric
Utility Enterprise’s provision of Telecommunication Facilities and Services and to make other
changes to the administration of Utility Services in light of this new assignment of direct
responsibility to the City Manager; and
WHEREAS, on January 16, 2018, the City Council also adopted Ordinance No. 010,
2018, to appropriate $1.8 million from the City’s General Fund as a loan to the City’s Light and
Power Fund to be used by the Electricity Utility for its start-up costs related to providing
Telecommunication Facilities and Services; and
WHEREAS, Ordinance No. 011, 2018 also amended Code Section 8-77 to provide that
the City’s revenues, debt issuance proceeds and expenditures related to Telecommunication
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Facilities and Services shall be deposited, expended and administered through the City’s Light
and Power Fund; and
WHEREAS, the City Council now desires to amend City Code Section 2-31 regarding
executive sessions to implement the authority of the Council, and any board or commission
established under Section 7(e), to go into executive session to consider matters pertaining to
issues of competition in providing Telecommunications Facilities and Services; and
WHEREAS, the City Council hereby finds that this Ordinance is necessary for the
public’s health, safety and welfare and is in the best interests of the City and its residents,
businesses, and public and private organizations and of the Electric Utility’s ratepayers.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF
FORT COLLINS as follows:
Section 1. That the City Council hereby makes and adopts the determinations and
findings contained in the recitals set forth above.
Section 2. That City Code Section 2-31(a) of the Code of the City of Fort Collins is
hereby amended by the addition of a new subsection (5) which reads in its entirety as follows:
(5) Consideration, by the Council or any board or commission established under
Article XII, Section 7(e) of the City Charter, of matters pertaining to issues of
competition in providing the telecommunication facilities and services authorized in
Article XII, Section 7 of the City Charter and City Code Section 26-398 including,
without limitation, matters subject to negotiation, strategic planning, pricing, sales and
marketing, development phasing and any other matter allowed under Colorado law.
. . .
Introduced, considered favorably on first reading, and ordered published this 3rd day of
July, A.D. 2018, and to be presented for final passage on the 17th day of July, A.D. 2018.
__________________________________
Mayor
ATTEST:
_______________________________
City Clerk
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Passed and adopted on final reading on the 17th day of July, A.D. 2018.
__________________________________
Mayor
ATTEST:
_______________________________
City Clerk