HomeMy WebLinkAboutMINUTES-01/04/2000-RegularJanuary 4, 2000
COUNCIL OF THE CITY OF FORT COLLINS, COLORADO
Council -Manager Form of Government
Regular Meeting - 6:00 p.m.
A regular meeting of the Council of the City of Fort Collins was held on Tuesday, January 4, 2000,
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: Byrne, Kastein, Martinez, Mason, Wanner and Weitkunat.
Councilmembers Absent: Bertschy.
Staff Members Present: Fischbach, Krajicek, Roy.
Citizen Participation
Randy Fischer, 3007 Moore Lane, flood plain regulation task force member, spoke regarding
historic flooding and flood plain issues.
Agenda Review
Councilmember Byrne withdrew item #27 Resolution 2000-5 Endorsing Federal Legislation
Requiring the Collection of State and Local Sales and Use Taxes on Remote Sales from the Consent
Calendar.
Councilmember Kastein withdrew item # 19 First Reading of Ordinance No. 1, 2000, Appropriating
Use Tax Carryover Reserves in the Sales and Use Tax Fund for a Rebate oflmpact Fees to Symbios
Logic, Inc. from the Consent Calendar.
CONSENT CALENDAR
Consideration and adoption of the Council meeting minutes of November 2 1999
November 16, 1999. December 7. 1999 and the adjourned meeting minutes of November 9
1999 and December 14 1999.
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8. Second Reading of Ordinance No. 187,1999 Amending Section 2-581 of the City Code and
Setting the Compensation of the City Attorney.
City Council met in Executive Session on November 9, 1999 to conduct the performance
appraisal of City Attorney Steve Roy. This Ordinance, which was unanimously adopted on
First Reading on December 7, 1999, establishes the 2000 salary and compensation of the
City Attorney.
9. Second Reading of Ordinance No. 188,1999, Amending Section 2-596 of the City Code and
Setting the Compensation of the City Manager.
City Council met in Executive Session on November 9, 1999 to conduct the performance
appraisal of City Manager John Fischbach. This Ordinance, which was unanimously
adopted on First Reading on December 7, 1999 establishes the salary and compensation
provided the City Manager.
10. Second Reading of Ordinance No. 189,1999, Amending Section 2-606 of the City Code and
Setting the Compensation of the Municipal Judge.
City Council met in Executive Session on November 9, 1999 to conduct the performance
appraisal of Municipal Judge Kathleen M. Lane. This Ordinance, which was unanimously
adopted on First Reading on December 7, 1999, establishes the salary and compensation of
the Municipal Judge.
11. Second Reading of Ordinance No. 191, 1999, Adding a New Division 4 to Cha ten r 25
Article II of the Code of the City of Fort Collins Establishing a Program for a Rebate of the
City's Sales and Use Taxes for Materials Used in the Construction of Affordable Housing
Units, and the Deferral of The Payment of Sales and Use Taxes Thereon
Ordinance No. 191, 1999, which was unanimously adopted on First Reading on December
7, 1999 establishes a program to provide for a rebate of the City's Sales and Use Taxes for
affordable housing units. The impetus for the program comes from the City Council's 1999-
2001 Policy Agenda, Theme IV. Helping Make Housing Affordable to Our Citizens -
E. Rebates. The Sales and Use Tax Rebate Program would be another direct financial
incentive program which would logistically operate similar to the previous "Development
Impact Fee Rebate Program."
On Second Reading, a new provision has been added to Section 25-57 of the Code to clarify
that the rebate of sales and use tax for affordable housing units would be available only to
those applicants who pay the tax after the effective date of the Ordinance, i.e., January 14,
2000.
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January 4, 2000
12. Second Reading of Ordinance No. 193, 1999 Amending Chanter 23 Article III of the City
Code by the Addition of a New Division 4 Pertaining to Neighborhood Entry Signs and
Amending Section 24-1 of the City Code Pertaining to Signs on Streets and Sidewalks
There have been recent inquires regarding the placement of Neighborhood Entry signs in the
public right-of-way. City staff has developed a process to manage these requests, in order
to allow established, organized neighborhoods to request a revocable permit from the City
to erect Neighborhood Entry Signs. Ordinance No. 193, 1999, was unanimously adopted on
First Reading on December 7, 1999.
13. Second Reading of Ordinance No. 194, 1999 Amending Chanter 19 of the City Code So as
to Establish the Municipal Court as a Court of Record
The Fort Collins Municipal Court is not a "court of record", meaning that there is no
verbatim transcript of the hearings held in the Court. The most significant impact of this is
that if a defendant appeals a conviction, he/she is entitled to a new trial in County Court. By
becoming a court of record, appeals would be based on the record of the trial in Municipal
Court and would go directly to District Court. By state statute, an ordinance is required in
order to become a court of record. Ordinance No. 194, 1999, was unanimously adopted on
First Reading on December 7, 1999.
14. Second Reading of Ordinance No. 195, 1999, Authorizing the Acquisition by Eminent
Domain Proceedings of Certain Lands for the Roma Valley Drive Street Connection with
Mail Creek Lane.
The acquisition of land through uncontested eminent domain proceedings is necessitated by
the May 18, 1999 City Council approval of the Master Street Plan Amendment. This
amendment required a new street connection network that allows the Mail Creek Lane/Roma
Valley Drive connection in lieu of the Highcastle Drive connection over Mail Creek.
Ordinance No. 195, 1999 was unanimously adopted on First Reading on December 7, 1999
authorizing the acquisition of the above mentioned property.
15. Second Reading of Ordinance No. 196, 1999 Desi�ng the Winslow/Guard House 730
West Olive Street, as a Local Landmark Pursuant to Chanter 14 of the City Code
The owner of the property, Ada May Guard, is initiating this request for Local Landmark
designation for the Winslow/Guard House. The building is significant for its architectural
importance, as a beautiful example of the American Foursquare architectural style in Fort
Collins. Ordinance No. 196, 1999 was unanimously adopted on First Reading on December
7, 1999 designating 730 West Olive Street as a local landmark.
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January 4, 2000
16. Items Relating to the Fossil Creek Wetlands Annexation and Zoning
A. Second Reading of Ordinance No. 197, 1999, Annexing Property Known as the
Fossil Creek Wetlands Annexation to the City of Fort Collins.
B. Second Reading of Ordinance No. 198, 1999, Amending the Zoning Map of the City
of Fort Collins and Classifying for Zoning Purposes the Property Included in the
Fossil Creek Wetlands Annexation.
APPLICANT: The City of Fort Collins
OWNER: The City of Fort Collins
On December 7, 1999, Council unanimously adopted Resolution 99-138 Setting Forth
Findings of Fact and Determinations Regarding the Fossil Creek Wetlands Annexation.
Also on December 7, 1999, Council unanimously adopted, on First Reading, Ordinance
No.'s 197 and 198, 1999, which annex and zone approximately 90.43 acres of publicly
owned property located south of East Trilby Road and west Timberline Road. The
recommended zoning is Public Open Lands (POL), and it is adjacent to a larger piece of
Public Open Lands. This is a 100% Voluntary Annexation.
17. Postponement of Second Reading of Ordinance No 199 1999 Authorizing the Lease of
Portions of the Resource Recovery Farm to LaFarge Corporation for Sand and Gravel
Mining in Order to Protect Sensitive Natural Habitats Along the Cache la Poudre River, to
February 15, 2000.
Ordinance No. 199, 1999, which was unanimously adopted on First Reading on December
7, 1999, enables implementation of a unique natural area conservation project involving the
City of Fort Collins, LaFarge Corporation, Flatiron Companies, and Colorado State
University. The collaborative project will save from sand and gravel mining approximately
40 acres of meadow and mature riparian forest along the Cache la Poudre River that
represents some of the most unique and valuable wildlife habitat in the Fort Collins area.
hi exchange for not mining these sensitive natural habitats, approximately 106 acres of
much less sensitive agricultural land on the City's Resource Recovery Farm will instead be
mined. Reclamation of the mined area on the Resource Recovery Farm will enhance the
wildlife habitat diversity and overall value of the natural areas along this reach of the Cache
la Poudre River. This area will enhance the City's efforts to protect and enhance the wildlife
habitat, aesthetic, and recreational values of this section of the Poudre River consistent with
the City's Natural Areas Policies and will also enhance programs at CSU's Environmental
Learning Center.
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Second Reading of this Ordinance is being postponed to February 15, 2000 to allow
additional time to finalize the necessary lease and contractual documents with LaFarge,
Flatiron, and Colorado State University.
18. Second Reading of Ordinance No. 200. 1999 Amending Section 24-42(c) of the City Code
for the PgMose of Correcting an Error.
Ordinance No. 200, 1999 was unanimously adopted on First Reading on December 7, 1999
and amends Section 24-42(c) of the City Code making reference to Section 24-657(g)(4) of
the Code, which section does not exist.
19. First Reading of Ordinance No. 1.2000 Appropriating Use Tax Carryover Reserves in the
Sales and Use Tax Fund for a Rebate of Impact Fees to Symbios Logic,
On July 18, 1995, Council adopted Ordinance No. 112, 1996 approving and authorizing the
rebate of impact fees associated with the construction of a 100,000 square foot office
building for Symbios Logic, Inc. Fees were estimated to be $440,000. Council approved
a rebate not to exceed that amount. The Ordinance also provided that the rebate be made
to Symbios Logic only after a sum equaling twice the amount of the cost to maintain the
public infrastructure surrounding the facility over a twenty-year period be paid to the City.
Those infrastructure costs were estimated to be approximately $40,000. Symbios has well
exceeded this amount through payments of sales and use taxes and property taxes.
20. First Reading of Ordinance No. 2, 2000 Appropriating Unanticipated Revenue in the
General Fund for the Police Services Victim Services Team
The Fort Collins Police Services Victim Services Team has been awarded a one-year grant
for the period of January 1 to December 31, 2000, by the Eighth Judicial District Victims
and Law Enforcement (V.A.L.E.) Board to help fund additional growth for this team.
Previous V.A.L.E. grants were received in 1998 and 1999 for $19,500 each year.
21. First Reading of Ordinance No. 3, 2000 Modifying the Description of a Previously
Authorized Easement Conveyance to Charles R. Nauta and Connie L. Nauta
In 1997, the City Council approved the execution of two drainage easements to Charles and
Connie Nauta (the "Nautas"), pursuant to a Release and Settlement Agreement (the
"Settlement Agreement") that had been entered into between the City and the Nautas. Those
deeds of easement have not yet been executed because the property to be conveyed by one
of the easements had been encumbered by a railroad right-of-way, and the City was not in
a position to convey that portion of the easement to the Nautas. The City has recently
acquired title to that railroad right-of-way and is now in a position to convey that easement
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without any railroad right-of-way encumbrance. This Ordinance would substitute the new
legal description of the easement for the one approved by Ordinance No. 79, 1997.
22. First Reading of Ordinance No. 4, 2000, Amending the Definitions of "Building Permit"
in Sections 7.5-17 and 7.5-47 of the City Code
Under Chapter 7.5 of the Code of the City, Capital Improvement Expansion (CIE) Fees,
school fees in lieu of land dedication, and neighborhood parkland fees are collected prior to
issuing building permits for the construction of new dwelling units. Phase I of Dry Creek
Mobile Home Park, located northeast of the Downtown Fort Collins Airpark, began
construction in early 1998. By July of 1999, 59 "mobile home installation permits" had been
issued by City Building and Zoning Department. Building and Zoning Department Director
Felix Lee (the "Director") placed a "hold" on issuing further permits upon discovering that
except for Street Oversizing fees, no other impact fees were collected. The developer
indicated that he had asked about all applicable fees prior to pursuing the project and was
told no other impact fees would be assessed. The City and the developer soon reached an
interim agreement by which additional mobile home installation permits were issued. The
developer paid the disputed CIE, school fees and neighborhood parkland fees on further
mobile home installations under protest to be held in a special City escrow account pending
the outcome of an administrative appeal to the City Manager.
23. Items Relating to the Gateway Mountain Park.
A. Resolution 2000-1 Authorizing the Mayor to Enter into the Second Amendment to
the Intergovernmental Agreement Between the City and the Colorado Department
of Transportation ("CDOT") for Highway Realignment and Access Design for
Gateway Mountain Park.
B. First Reading of Ordinance No. 5, 2000, Appropriating Unanticipated Revenue in the
Capital Projects Fund for Gateway Mountain Park.
Gateway Mountain Park is a 400-acre site located five miles up the Poudre Canyon. The site
is owned by the City of Fort Collins and was previously the City's Water Treatment Plant.
The City Council has provided direction to make this property accessible to the public.
These lands are currently inaccessible to the public because the entry road must be improved
to provide safe access.
Adoption of the Resolution authorizes the amendment of the Intergovernmental Agreement
between CDOT and the City of Fort Collins for the design and development of the access
road to Gateway Mountain Park. The City entered into the Agreement on September 30,
1998 (Resolution 98-113).
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January 4, 2000
24. Items Relating to Railroad Crossing Warning Devices for Linden Street
A. Resolution 2000-2 Authorizing the City Manager to Enter into an Agreement with
the Colorado Department of Transportation, and the Union Pacific Railroad
Company for Installing New Crossing Warning Devices at the Linden Street
Crossing of the Union Pacific Railroad Tracks Northeast of Jefferson Street.
B. First Reading ofOrdinance No. 6, 2000, Appropriating Unanticipated Revenue in the
Railroad Consolidation Project Fund to be used for Installing Crossing Warning
Devices at the Linden Street Crossing of the Union Pacific Railroad Tracks
Northeast of Jefferson Street.
The agreement with the Colorado Department of Transportation (CDOT), and the Union
Pacific Railroad Company (UPRR), is for installation of crossing warning devices at the
Linden Street crossing ofthe Union Pacific Railroad tracks northeast of Jefferson Street. The
project consists of constructing new signals and gates to improve safety at the crossing.
The City applied for and received Federal ISTEA Funds to pay for 100% of the cost to
install the crossing warning devices. The appropriation ordinance appropriates the $154,000
in Federal Funds budgeted towards the project into the Railroad Consolidation Project Fund.
Not covered by federal funding, the City is required to pay for indirect costs. These costs,
estimated at $10,000, will be paid for with existing Railroad Consolidation Project Funds.
25. Items Relating to Railroad Crossing Warning Devices for Lincoln Avenue
A. Resolution 2000-3 Authorizing the City Manager to Enter into an Agreement with
the Colorado Department of Transportation, and the Union Pacific Railroad
Company for Installing New Crossing Warning Devices at the Lincoln Avenue
Crossing of the Union Pacific Railroad Tracks Northeast of Jefferson Street.
B. First Reading of Ordinance No. 7, 2000, Appropriating Unanticipated Revenue in the
Railroad Consolidation Project Fund to be used for Installing Crossing Warning
Devices at the Lincoln Avenue Crossing of the Union Pacific Railroad Tracks
Northeast of Jefferson Street. .
The agreement with the Colorado Department of Transportation (CDOT), and the Union
Pacific Railroad Company (UPRR), is for installation of crossing warning devices at the
Lincoln Avenue crossing of the Union Pacific Railroad tracks northeast of Jefferson Street.
The project consists of constructing new signals and gates to improve safety at the crossing.
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January 4, 2000
The City applied for and received Federal ISTEA Funds to pay for 100% of the cost to
install the crossing warning devices. Adoption of the Ordinance would appropriate the
$148,844 in Federal Funds budgeted towards the project into the Railroad Consolidation
Project Fund. Not covered by federal funding, the City is required to pay for indirect costs.
These costs, estimated at $6,156, will be paid for with existing Railroad Consolidation
Project Funds.
26. Resolution 2000-4 Amending the City of Fort Collins' General Employees Retirement Plan
As part of the budget process, the General Employees Retirement Committee recommended
the Council consider a one-time cost of living adjustment for the retirees and beneficiaries
of the General Employees Retirement Plan. This Retirement Plan was designed for non -
uniformed personnel hired by the City. It is a defined benefit plan in which the amount of
retirement is determined by the number of years of service and the employee's average
salary as defined in the Plan at the time of retirement. The Plan does not contain an
automatic inflationary adjustment provision.
During the budget process, the Council included an appropriation of funds to cover the
anticipated cost of a one-time cost of living adjustment for members of the plan that retired
prior to 1999. This resolution makes the corresponding adjustment to the Plan to implement
the adjustment. The cost of living adjustment schedule calls for the increase to track the
annual level of inflation experienced since 1990 less one percent.
27. Resolution 2000-5 Endorsing Federal Legislation Requiring the Collection of State and
Local Sales and Use Taxes on Remote Sales.
In 1998, Congress enacted a law that provided for a three-year moratorium on sales and use
taxes being charges on goods being sold over the Internet. The stated purpose of the law was
to protect Internet based commerce (e-commerce) in the formative stages ofits development.
Many large e-commerce retailers convinced the Congress that this method of sales needed
protection from state and local sales taxes in order to grow. Based on the studies of several
national research organizations, e-commerce is not only growing, but is experiencing
exponential growth. The volume of sales over the Internet is doubling every 18 months.
Some research indicates certain categories of sales are growing even faster.
Allowing Internet sales to occur without regard for state and local taxes creates an inequity
in tax collection obligations between mainstreet hometown businesses and their electronic
and mail -order catalog competitors. Resolution 2000-5 expresses the Council's position
that sales and use taxes should be collected on all types of remote vendor sales in order to
maintain an equitable system of taxation.
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January 4, 2000
28. Resolution 2000-7 Designating the Place for Posting Notices of Certain Public Meetings
The state Sunshine Law requires that, at its first regular meeting of each year, the City
Council designate the place for the posting of notices of meetings to be held by the Council,
City boards and commissions or any committees of the same.
29. Resolution 2000-8 Making Findings of Fact and Conclusions Regardingthe he Appeal of a
Decision ofthe Administrative Hearing Officer Relating to the Oakridge Business Park 28th
Filing (Bank of Colorado) Project Development Plan
On November 9, 1999, an Amended Notice of Appeal of the October 12, 1999 decision of
the Administrative Hearing Officer to approve the Oakridge Business Park PUD, 28th Filing
(Bank of Colorado) — Project Development Plan was filed by the Appellant, Cimarron —
Harmony Comer LLC.
On December 14, 1999, City Council voted to uphold the decision of the Administrative
Hearing Officer, with one condition attached. In order to complete the record regarding this
appeal, the Council should adopt a Resolution making findings of fact and finalizing its
decision on the appeal.
30. Resolution 2000-9 With Respect to Issuance of Revenue Bonds of the City of Fort Collins
Colorado to Finance All or aPortion of the Cost of Acquiring Constructing Equipping and
Improving Certain Facilities For Anheuser-Busch Companies Inc and Anheuser-Busch
Incorporated; Authorizing the Execution of a Memorandum of Agreement by and Between
the City of Fort Collins. Colorado and Said Corporations: and Related Matters
In mid -November of 1999, representatives of Anheuser-Busch Companies, Inc. (the
"Company") and Anheuser-Busch, Incorporated ("ABI"), a wholly owned subsidiary of the
Company contacted the City to request consideration of using private activity bonds to
finance sewage and solid waste disposal facility near the existing brewery located in the
northeast part of the City. The Company estimates the total amount of bonds for which a
private activity bond allocation would be sought for the project to be $30 million.
Each year the City receives a private activity bond allocation from the State of Colorado.
In 2000, the amount is $2,756,250. Council has previously established affordable housing
private activity bonds as the top priority use for its 2000 allocation. Staff expects that an
affordable housing project will apply for the City's entire allocation and also need to request
additional allocation from the Statewide balance of private activity bonds. The Company
is requesting the City also support its application to the State for a portion of the statewide
balance. Approval of the inducement resolution would allow the Company to submit an
application to the State. The Resolution also sets the beginning point for the transaction.
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January 4, 2000
Costs that the Company incurs after the Resolution is approved maybe reimbursed from the
proceeds of the bond issue.
Ordinances on Second Reading were read by title by City Clerk Wanda Krajicek.
8. Second Reading of Ordinance No. 187,1999 Amending Section 2-581 of the City Code and
Setting the Compensation of the City Attorney.
9. Second Reading of Ordinance No. 188, 1999 Amending Section 2-596 of the City Code and
Setting the Compensation of the City Manager.
10. Second Reading of Ordinance No. 189,1999 Amending Section 2-606 of the City Code and
Setting the Compensation of the Municipal Judge
11. Second Reading of Ordinance No 191, 1999 Adding a New Division 4 to Chapter 25
Article H of the Code of the City of Fort Collins Establishing a Program for a Rebate of the
City's Sales and Use Taxes for Materials Used in the Construction of Affordable Housing
Units, and the Deferral of The Payment of Sales and Use Taxes Thereon
12. Second Reading of Ordinance No. 193, 1999, Amending Chapter 23 Article III of the City
Code by the Addition of a New Division 4 Pertaininiz to Neighborhood Entry Signs and
Amending Section 24-1 of the City Code Pertaining to Signs on Streets and Sidewalks
13. Second Reading of Ordinance No. 194, 1999 Amending Chapter 19 of the City Code So as
to Establish the Municipal Court as a Court of Record
14. Second Reading of Ordinance No. 195, 1999 Authorizing the Acquisition by Eminent
Domain Proceedings of Certain Lands for the Roma Valley Drive Street Connection with
Mail Creek Lane.
15. Second Reading of Ordinance No. 196. 1999 Designating the Winslow/Guard House 730
West Olive Street, as a Local Landmark Pursuant to Chapter 14 of the City Code
16. Items Relating to the Fossil Creek Wetlands Annexation and Zoning_
A. Second Reading of Ordinance No. 197, 1999, Annexing Property Known as the
Fossil Creek Wetlands Annexation to the City of Fort Collins.
January 4, 2000
B. Second Reading of Ordinance No. 198,1999, Amending the Zoning Map of the City
of Fort Collins and Classifying for Zoning Purposes the Property Included in the
Fossil Creek Wetlands Annexation.
18. Second Reading of Ordinance No. 200 1999 Amending Section 24-42(c) of the City Code
for the Purpose of Correcting an Error.
35. Second Reading of Ordinance No. 192, 1999 Amending Section 24-1 of the City Code
Pertaining to Signs on Bus Shelters and Bus Benches
Ordinances on First Reading were read by title by City Clerk Wanda Krajicek.
19. First Reading of Ordinance No. 1 2000 Appropriating Use Tax Carryover Reserves in the
Sales and Use Tax Fund for a Rebate of Impact Fees to Symbios Logic Inc
20. First Reading of Ordinance No. 2, 2000 Appropriating Unanticipated Revenue in the
General Fund for the Police Services Victim Services Team
21. First Reading of Ordinance No. 3. 2000 Modifying the Description of a Previously_
Authorized Easement Conveyance to Charles R. Nauta and Connie L. Nauta
22. First Reading of Ordinance No. 4. 2000, Amending the Definitions of `Building Permit'
in Sections 7.5-17 and 7.5-47 of the City Code
23. First Reading ofOrdinance No. 5,2000 Appropriating Unanticipated Revenue in the Capital
Projects Fund for Gateway Mountain Park
24. First Reading of Ordinance No. 6. 2000 Appropriating Unanticipated Revenue in the
Railroad Consolidation Proiect Fund to be used for Installing Crossing Warning Devices at
the Linden Street Crossing of the Union Pacific Railroad Tracks Northeast of Jefferson
Street.
25. First Reading of Ordinance No. 7, 2000 Appropriating Unanticipated Revenue in the
Railroad Consolidation Project Fund to be used for Installing Crossing Warning Devices at
the Lincoln Avenue Crossing of the Union Pacific Railroad Tracks Northeast of Jefferson
Street.
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Councilmember Mason made a motion, seconded by Councilmember Wanner, to adopt and approve
all items not withdrawn from the Consent Calendar. The vote on the motion was as follows: Yeas:
Councilmembers Byrne, Kastein, Martinez, Mason, Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
Staff Reports
City Manager Fischbach noted that at the end of 1999 the City received $66,559 from the Housing
Authority as payment toward principal and interest for the loan made to the Authority.
Councilmember Reports
Councilmember Byrne reported on the North Front Range Transportation Air Quality Planning
Council discussions regarding regional transportation needs, funding and planning strategies and
the evaluation of Executive Director Ron Phillips.
Councilmember Weitkunat reported on the December 20, 1999 Larimer County Commissioners
discussion of the West Chase development proposal, which is of interest to the City because of the
intergovernmental agreement with the County.
Councilmember Wanner reported on the Health and Safety Committee discussions regarding the
smoking ordinance, the public nuisance ordinance, the Liquor Licensing Authority, and Police
Services community relations.
Councilmember Wanner reported on the Growth Management Committee's discussions regarding
the West Chase development plan, the access management plan, and the downtown river corridor
implementation plan.
Councilmember Mason reported on the Finance Committee's discussions regarding the economic
policy team, four Downtown Development Authority projects and revenue bond issues, Anheuser-
Busch private activity bonds, revenue impact issues, intemet taxation, and the legislature's review
of creation of a sales tax exempt period in the State.
Councilmember Byrne reported on the organizational meeting of the I-25 corridor team.
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January 4, 2000
Consideration of an Appeal Filed by
Larimer County Challenging the Validity of the
Building Review Board's Decision of October 28,1999,
Denying a Variance to Larimer County Regarding the
City Building Code which Specifies Certain Guardrail Safety
Standards Relative to the Larimer County Detention Center
Expansion Project at 2405 Midpoint Drive,
Fort Collins, Decision of the Building Review Board Overturned
The following is staff s memorandum on this item.
"Executive Summary
At its October 28, 1999, meeting, the Building Review Board (BRB) denied Lorimer County a
variance from certain safety standards contained in the City Building Code as they apply to second
level walkway guardrails in the inmate residential areas of the new Larimer County Detention
Center Expansion. The provisions of the 1991 UNIFORMBUILDING CODETm (UBC), adopted in
both the City and Larimer County at the time of and prior to construction, prohibit intermediate
openings in guardrails that allow a sphere 4-inches and larger to pass through them, except in
"non-public areas of commercial and industrial -type occupancies". The plans submitted with the
permit application depict complying guardrails. After the new facility was well underway, the
applicant unsuccessfully requested a variance from the Building and Zoning Director (the
"Director') to allow the commercial -industrial exception to the general rule. Subsequently, the
applicant appealed to the BRB to allow the commercial -industrial exception. The BRB denied the
appeal, finding that the Director's interpretation of the code was correct and that the applicant
failed to provide an acceptable alternate design or method.
BACKGROUND:
The nearly completed Detention Facility was begun in mid-1998. Administrative areas are
approved for occupancy and the remainder of project is undergoing completion.
In the latter part of 1997, Larimer County retained Tyree Associates, an approved private service,
to perform the required plan review on the Lorimer County Detention Facility expansion and
remodel project under the 1991 UNIFORMBUILDING CODE' (UBC). In its preliminary review
dated October 7, 1997, the consultant noted the Code's prohibition of intermediate openings in
guardrails that allow a sphere 4-inches and larger to pass through them, except in "non-public
areas of commercial and industrial -type occupancies, where intermediate guardrail openings may
be increased based on a 12-in. maximum "sphere" not passing through them. Fort Collins
amendments in effect when the City issued the permit in June 1998 are more specific --prescribing
that thel2-in. exception is ftrther limited to "non-public areas for production, manufacturing,
storage, or similar areas ". Current guardrail specifications in the 1997 UBC, which is currently
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in effect in Fort Collins and Larimer County, are consistent and identical to the 1991 UBC with
respect to permitted opening size and geometry.
In its March 1998 written response to Tyree's report sent to City stafffromproject design consultant
Reilly Johnson Architecture, the consultant stated that it had used the commercial -industrial
exception before in other such projects. Final construction plans accompanying the buildingpermit
detail complying guardrails utilizing 4-in by 4-in. welded wire mesh as the intermediate barrier
(BRB Exhibit `B ).
The guardrails, about which this appeal to Council is being heard, are installed on the second level
walkways of the "inmate housing" areas. This past summer, the applicant was unsuccessful in
obtaining approval ofthe non-public, commercial -industrial guardrail exception from the Director.
Unable to obtain that approval, the applicant then sought relief from the Director's decision
through an appeal to the Building Review Board (BRB) at its regular October 28, 1999 meeting. The
applicant requested approval of a design based on the exception and consisting of the following
elements: one and `/-inch diameter horizontal rails, vertically spaced approximately 12 in. on -
center (o/c.), attached to vertical baluster supports spaced approximately 60 in. o1c.
BRB HEARING SUMMARY
Robert Brashears of Reilly Johnson Architecture, the design consultant for the project, was the sole
representativepresent acting on behalfofthe applicant. Brashears argued that the inmate housing
spaces in the facility are not accessible to the general public and therefore should be entitled to the
commercial -industrial exception. He noted that his firm has designed such facilities for other
jurisdictions that were allowed to apply the exception. Brashears further argued that the greater
12-in. intermediate guardrail spacing is essential for security in inmate housing areas as well as
the for the overall facility security. He stated that the Y4-in. diameter, 4-in. by 4-in. wire grid design
shown on the plans was later deleted after the bid process in order to reduce costs and because it
would significantly compromise staff visibility/security. Brashears stated his opinion that the
general code requirement is intended to protect the public at large, including small children and,
therefore, should not apply in this case. Brashears concluded the applicant's case by stating it was
their position that the Director's interpretation of the code is erroneous and that the BRB should
have the latitude to make exceptions that work in a "real world" application.
The Director responded that the commercial -industrial exception is not applicable because the
UBC, currently and for many years, has distinctly classified jails and prisons as "Institutional"
occupancies. The Director's understanding of the long-standing rationale for the codes not
including such institutions as being eligible for the commercial -industrial exception is that
institutional inmates and patients are frequently restrained or are otherwise rendered incapable of
self-preservation -- in effect leaving them dependent on others and built-in systems for protection
from injury. The Director further argued that the building codes are in place for the protection of
all building occupants and that some inmates and staff members could easily fit through the
January 4, 2000
guardrails now in place, creating the potential for serious injury in the event of an altercation or
accident that results in a fall onto the floor below. The Director concluded the staff presentation
citing that the City's first charge is public safety for all building occupants and that the applicant
had not presented any witnesses or other options such as equivalent safety measures or
documentation identifying specific security concerns to staff or to the BRB for consideration.
BRB AUTHORITY
The BRB does not have the discretionary authority to summarily waive requirements of the building
code. Any modifications or variances to the building code approved by the Board must be within
the context of the criteria set forth in Sections 105.1 through 105.4 of the 1997 UBC as amended by
the City. In order to rule in favor of the appellant, the Board must determine either one of the
following:
(I) The building official's interpretation of the building code is "erroneous "; or that,
(II) " ... an alternate design, alternate materials, or the alternate methods proposed by the
appellant are equivalent to those prescribed by this code considering structural strength,
effectiveness, fire resistance, durability, safety and any other pertinent factors. " provided
further that, " . . . the Board shall require sufficient evidence be submitted to substantiate any
claims made regarding the proposed alternate design, alternate materials and/or alternate
methods of construction. "
BRB FINDINGS
The BRB unanimously denied the appeal, finding that the Director's interpretation of the Code in
this case was not erroneous and that the applicant had not submitted for consideration a suitable
alternate design providing equivalent safety.
SCOPE OF COUNCIL CONSIDERATION
Council is empowered to "uphold, overturn, or modify the decision of the (BRB) " or to remand the
case to the BRB for rehearing pursuant to Section 2-56 based upon the record on appeal, the
relevant provisions of the Code and Charter, the grounds for appeal cited in the notice of appeal
and any additional issues identified by a member of the City Council prior to the hearing. (Any such
additional issues must be identified in writing and filed with the City Clerk no later than ten (10)
calendar days prior to the date of the hearing.) No such additional issues have been identified in
this case.
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January 4, 2000
At the conclusion of such hearing, the City Council may uphold, overturn or modify the decision of
the board or commission; provided, however, that the Council may instead remand the matter for
rehearing in order for the Board to receive and consider additional information with regard to any
issue raised on appeal. "
Mayor Martinez briefly introduced the agenda item.
City Attorney Roy explained the appeal process and the alternatives available to the Council
Felix Lee, Director of Building and Zoning, presented background information relating to the appeal
and the determination he made regarding the guardrails based on public interest and safety. He
stated that the Building Review Board unanimously denied the appeal and found that his
interpretation was not in error and that the applicant had not submitted any suitable alternative. He
outlined the relevant provisions of the Uniform Building Code relating to institutional occupancies
such as the detention center and stated that the proposed guardrails fail in their intended function
as a safety barrier and do not conform to submitted and approved building plans.
Mayor Martinez asked for clarification of the role of the City as the opponent to the appeal. City
Attorney Roy stated that the parties to the appeal are the City and the appellants.
George Haas, Larimer County Attorney, representing the appellant, explained the County's position
regarding the spacing requirement for the guardrails and presented a replica to illustrate his
argument. He spoke regarding the plan check process and budget for the jail project and stated that
the guardrail plans were changed to save public funds and bring the jail project costs down. He
noted that the guardrails as planned would have obscured visibility to the second level. He stated
that the architect received verbal approval for the new guardrail design from someone in the
Building Department at the City, although no written approval was obtained. He stated that the
redesign saved approximately $8,000 on the guardrail construction and that a retrofit would cost
approximately $20,000 of public money. He asked Council to approve the new design for the
following reasons: (1) the reason for the four -inch spacing requirement of the Uniform Building
Code is to prevent toddlers and infants from falling through the guardrails; (2) the proposed railing
is legal under the UBC for some occupancies where the public is not permitted access; (3) as a
practical matter the four -inch spacing for the railing would not achieve significantly greater safety;
(4) the jail occupants do not have access to the railing and there is constant observation and
supervision in the cell block in the vicinity of the railing; and (5) upholding the decision of the
Building Review Board would not enhance public safety and would result in the expenditure of an
additional $20,000 of public funds. He cited the provisions of UBC Section 104.2 relating to powers
and duties of the Building Official, UBC Section 104.2.7 relating to modifications and UBC 101.2
relating to purposes of the Code. He asked that the Council apply common sense and logic in
interpreting the UBC and that the decision of the Building Official and the Building Review Board
be overturned.
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January 4, 2000
Mayor Martinez established a time limit of ten minutes for each side for rebuttal.
Lee stated that the authority of the Building Review Board is limited by Code to granting variances
only when alternate provisions are adequate or the Board could find that the building official
interpreted the Code in error. He stated that the jail is not an industrial use and that the proposed
guardrails are inadequate for safety.
Mr. Haas noted that a person could fall through the proposed guardrails but that it would be difficult
to do so.
Councilmember Byrne asked about the telephone call to the Building Department requesting verbal
approval of the plan change for the guardrails.
Mr. Haas stated that the guardrail design has been allowed at other detention centers.
Bob Brashears, Reilly Johnson Architecture, architect for the detention facility, spoke regarding the
procedural aspects of requesting approval of the plan change.
Councilmember Byrne asked if the four -inch railing requirement is a new provision in the recently
adopted UBC. Lee stated that the provision has been in the uniform codes for approximately 10
years.
Councilmember Weitkunat asked about the intent, purpose and application of exemptions for
industrial and commercial occupancies. Lee spoke about the rationale and use of such exemptions.
Councilmember Weitkunat asked about the latitude of the Building Review Board regarding
modifications and variances. Lee stated that the Board is empowered to grant variances and that the
burden is on the appellant to demonstrate equivalency of alternate methods and materials.
Councilmember Weitkunat asked about safety and security factors in the decision of the building
official and Building Review Board. Lee stated that his role is the preservation of public safety.
Councilmember Mason asked about the length of the guardrail and a description of the
improvements that could be accomplished with the estimated $20,000. Mr. Brashears described the
dimensions and shape of the guardrail and described the guardrail as it would be if another $20,000
was spent. He also addressed security concerns with reduced visibility.
Councilmember Mason asked about the possibility of modification based on an equivalent use rather
than an equivalent design. Lee spoke regarding the nature of the detention center use and stated that
the use is not equivalent to industrial uses. He stated that the County has not proposed any
alternatives for the City's consideration. City Manager Fischbach stated that the City proposed an
alternative that was rejected by the County.
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January 4, 2000
Mayor Martinez asked why the County did not accept the compromise offered by the City. Mr.
Haas spoke regarding cost and security issues. Mr. Brashears stated that adding additional bars to
the guardrail would obscure visibility.
Mayor Martinez asked about exceptions to the guardrail spacing requirements. W. Paul Eckman,
Deputy City Attorney, spoke regarding Code requirements and exemptions in industrial or
commercial uses. Lee stated that in his opinion the detention center is not an industrial or
commercial use but is an institutional use. City Attorney Roy stated that the alternative design using
one bar could be considered by the City Council.
Councilmember Kastein asked if the four -inch requirement is exclusively to prohibit toddlers from
falling through the guardrail. Lee stated that is the intent of the requirement.
Councilmember Kastein asked if the Council can discuss the alternative design or if the decision
must rest on the record. City Attorney Roy stated that it would be possible for the Council to
establish the one -rail alternative as an appropriate modification under the circumstances if, in
Council's judgment, there is a practical difficulty involved in carrying out the strict letter of the
Code.
Councilmember Weitkunat made a motion, seconded by Councilmember Byrne, to find that the
Building Review Board improperly interpreted and applied relevant provisions of the Uniform
Building Code and to overturn the decision of the Building Review Board to allow the County's
alternative of twelve -inch spacing of the guardrail railings as an acceptable equivalent solution
within the meaning of Section 105.2 of the Uniform Building Code.
Councilmember Weitkunat spoke regarding the purpose and intent of the spacing requirement and
the need for security at the jail. She stated that practicality should take precedence over the strict
interpretation of the law.
Councilmember Byme spoke regarding the interpretation of the Code and exceptions that may be
needed due to unique circumstances. He noted that the architect should have obtained written
approval from the City prior to changing the plans for the guardrail.
Councilmember Kastein spoke regarding safety issues and stated that the financial considerations
are not the basis of his decision.
Councilmember Wanner spoke regarding practical safety issues.
January 4, 2000
Councilmember Mason noted that this is a special use and that the four -inch spacing requirement
does not seem to apply in this situation.
Councilmember Weitkunat stated that the motion in no way implies that the building official and
the Building Review Board did not do their jobs correctly.
Mayor Martinez spoke regarding the need to take a common sense approach based on the need for
security at the jail. He stated that the guardrail project should not have proceeded without written
approval from the City.
City Manager suggested the possibility of remanding the matter back to the Building Review Board
to look at less costly alternative solutions.
The vote on the motion was as follows: Yeas: Councilmembers Byrne, Kastein, Martinez, Mason,
Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
Ordinance No. 192,1999
Amending Section 24-1 of the City Code Pertaining to
Signs on Bus Shelters and Bus Benches. Adopted on Second Reading
The following is staff's memorandum on this item.
"Executive Summary
Ordinance No. 192, 1999, which was unanimously adopted on First Reading on December 7, 1999,
permits staff to install 5 bus shelters to evaluate whether the Fort Collins citizens find the shelters
acceptable as to design and function."
Tom Frazier, Multi -Modal Transportation Group Leader, gave a brief presentation regarding the
agenda item.
Kelly Ohlson, 2040 Bennington Circle, opposed advertising on bus shelters.
Gary Young, President of Outdoor Promotions, spoke regarding public -private partnerships to
increase mass transit amenities and supported of the ordinance.
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January 4, 2000
Councilmember Byrne requested information regarding the appearance of the structures and
community feedback regarding the shelters. Frazier stated that brochures are available with pictures
of the structures and described the community outreach program.
Councilmember Byrne asked if all City bus shelters would be of uniform design. Frazier stated that
these types of bus shelters would be placed on major arterials.
Councilmember Byrne asked about using art in public places money for the construction of bus
shelters.
Councilmember Mason asked if all designs will include bike racks, lighting and trash receptacles.
Frazier replied in the affirmative.
Councilmember Mason asked if the contract will specify the size of advertising. Frazier stated that
there will be a standard sized advertising panel and that the size will be specified in the contract.
Councilmember Kastein asked how community input will be solicited. Linda Dowlen, TDM
Marketing Director, spoke regarding the planned community surveys.
Councilmember Kastein spoke regarding the cost to the City for implementing the bus shelter plan
and maintaining shelters compared with the revenue earned under this public -private plan. Frazier
noted that the City would attempt to offset City costs through obtaining federal grants.
Councilmember Mason asked if tobacco, liquor or firearms products could be advertised. City
Manager Fischbach stated that staff will check on the advertising of firearms.
Councilmember Weitkunat spoke about community perceptions regarding the pilot project and
supported the project as a viable means to fund bus shelters.
Mayor Martinez asked what percentage of the shelter the signs would cover. Frazier described the
coverage of the signs at one end of the shelter.
Councilmember Weitkunat made a motion, seconded by Councilmember Byme, to adopt Ordinance
No. 192, 1999 on Second Reading.
Councilmember Byrne stated that this type of structure should not be uniformly applied and
suggested exploring craft designs using art in public places money.
Councilmember Mason stated that he would support the project on an experimental basis and
suggested the placement of such shelters in commercial high intensity use areas.
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January 4, 2000
Councilmember Kastein thanked the Growth Management Committee for its work on the issue.
Mayor Martinez stated that this would be an example of growth paying its own way.
The vote on the motion was as follows: Yeas: Councilmembers Byrne, Kastein, Martinez, Mason,
Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
Resolution 2000-6
Establishing Guidelines for Citizen Participation
at City Council Meetings, Adopted as Amended
The following is staff's memorandum on this item.
"Executive Summary
This Resolution consolidates the rules ofprocedure previously established by the Council for the
conduct of its meetings and establishes new time limits for citizen input regarding agenda items.
BACKGROUND:
In 1997, the City Council adopted certain rules ofprocedure governing the conduct of its meetings.
These rules were amended on two different occasions during that year. Recently, the City Council
has discussed the amount of time that should be allowed for citizen input on agenda items. This
Resolution would consolidate the rules ofprocedure previously adopted by the Council and would
establish new guidelines for determining time limits for persons wishing to speak to agenda items.
Generally, the amount oftime allowed for citizen input on agenda items would be determined by the
Mayor by considering, prior to beginning citizen input on the items, how many persons wish to
speak to the item. If the number ofpersons wishing to speak is 12 or fewer, the general guideline
would be five minutes per person. Ifthe number ofpersons wishing to speak to the item is more than
12, the general guideline would be three minutes per person. Two exceptions would be established
by the Resolution. The first would permit the Mayor to increase the amount of time available to
persons whose interests might be more immediately and directly affected by a proposed item than
the general public. The second would allow the Mayor, under other circumstances, to either
increase or decrease the amount of time available for citizen input if the Mayor felt that such
adjustments were necessary in order to facilitate Council's understanding of the item, or to allow
Council to consider and resolve the item in a timely fashion. Any determinations made by the Mayor
with regard to such time limits would be subject to being overridden by a majority of the Council.
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January 4, 2000
Staffbelieves that these proposed changes would be advisable, since they would generally increase
the time for citizen participation while still leaving the Mayor or the majority of the Council the
flexibility to adjust the time limits if necessary. "
City Manager Fischbach provided a brief introduction to the agenda item and noted that this item
came out of the Council retreat.
City Attorney Roy reviewed the proposed Resolution.
Kelly Ohlson, 2040 Bennington Circle, spoke in opposition to the provision that would allow more
time to speak for individuals who are "more immediately or directly affected" by an agenda item.
Randy Fischer, 3007 Moore Lane, spoke in opposition to the Resolution.
Councilmember Mason asked how it would be determined which speakers are more immediately
or directly affected by an agenda item. City Attorney Roy stated that the Mayor would need to make
a determination on a case by case basis subject to the will of a majority of the Council. City
Manager Fischbach stated that the Resolution would allow a great deal of discretion to the Mayor
and Council.
Councilmember Weitkunat noted that the citizen comments relate to Section lc(l) of the proposed
Resolution and that this language may be inappropriate. City Attorney Roy stated that the
underlying question relates to how much discretion the chair should have in establishing time limits.
Councilmember Kastein suggested a need for an opportunityto hear additional technical information
from directly impacted entities in some cases.
Councilmember Mason spoke regarding the need to maintain flexibility and favored eliminating the
language as suggested by Councilmember Weitkunat.
Councilmember Wanner asked about time limits for zoning hearings. City Attorney Roy stated that
the time limit for participation in zoning hearings has been three minutes unless the Mayor extends
the time limit.
Councilmember Byrne spoke regarding the origin of the current rules of procedure and the
perception of the need for time limits because of the length of Council meetings. He spoke in favor
of flexibility rather than being overzealous in imposing time limits.
Councilmember Weitkunat made a motion, seconded by Councilmember Wanner, to adopt
Resolution 2000-6 as amended by striking in Section 1, Subsection c the following language: ":(1)
allow more time to a party who may be more immediately and/or directly affected by the item than
the general public; and (2) otherwise."
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January 4, 2000
Councilmember Mason supported the Resolution as amended.
Councilmember Weitkunat spoke regarding the need for meeting efficiency.
Councilmember Kastein expressed a concern that there would be no guideline regarding which
speakers should receive extra time.
Councilmember Wanner spoke regarding the length of past meetings.
Mayor Martinez spoke regarding the concern regarding lengthy meetings.
The vote on the motion was as follows: Yeas: Councilmembers Byrne, Kastein, Martinez, Mason,
Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
Ordinance No. 1, 2000
Appropriating Use Tax Carryover Reserves in the Sales and Use Tax
Fund for a Rebate of Impact Fees to Symbios Logic Inc Adopted on First Reading
The following is staff s memorandum on this item.
"Financial Impact
Funds for this rebate have been reserved in the Sales and Use Tax Fund since adoption of
Ordinance No. 112, 1996.
Executive Summary
On July 18, 1995, Council adopted Ordinance No. 112, 1996 approving and authorizing the rebate
of impact fees associated with the construction ofa 100, 000 square foot office building for Symbios
Logic, Inc. Fees were estimated to be $440,000. Council approved a rebate not to exceed that
amount. The Ordinance also provided that the rebate be made to Symbios Logic only after a sum
equaling twice the amount of the cost to maintain the public infrastructure surrounding the facility
over a twenty-year period be paid to the City. Those infrastructure costs were estimated to be
approximately $40, 000. Symbios has well exceeded this amount through payments of sales and use
taxes and property taxes.
On October 20, 1998, Council adopted Ordinance No. 189, 1998 which amended Ordinance No.
102, 1995. The purpose of the amendment was to correct previous ordinances, which allowed the
rebate of building permit fees and plan review fees. Section 5-326 of the City Code specifically
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January 4, 2000
limited the rebate offees to impact fees and should not have included building permit or plan check
fees.
On February 16, 1999, Council adopted Ordinance No. 31, 1999 that terminated the Development
Impact Fee Rebate Program. However, rebates that had been previously approved for Advanced
Energy and Symbios Logic were considered to be "in process " and thus remain eligible for rebate.
The purpose of this Ordinance is to appropriate $339, 400 from reserves in the Sales and Use Tax
Fund for Rebate to Symbios Logic. An additional $35,875 will also be appropriated for transfer
from the Sales and Use Tax Fund to the Capital Expansion Fund to cover fees that were
undercharged to Symbios. The undercharge occurred when the City's Building Inspection
Department calculated the fees for a manufacturing facility instead of an office building. This
transfer will alleviate the need for Symbios to pay the fees that were undercharged but that qualify
for rebate under this Ordinance.
The fees that were originally estimated, actually paid and that are now eligible for rebate are shown
below:
Estimated
Actual
Fee Amount Eligible
Type of Fee
Fee
Fee
For Rebate
Building Permit Fee
$ 29,453
None
$ 30,194
Plan Check Fee
19,144
14,419
None
Street Oversizing Fee
156,510
207,749
$207,749
Water Plant Investment Fee
20,300
20,055
20,055
Sewer Plan Investment Fee
15,100
15,100
15,100
Water Rights Requirement
14,400
25,920
25,920
Storm Water Fee
77,099
43,517
43,517
Electrical Development Fee
57,871
None
None
Construction Water Charge
None
44
44
Water Repay
None
13,521
13,521
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January 4, 2000
Fire Capital
17,865
4,827
4,827
General Gov't Capital
20,247
5,376
5,376
Police Capital Expansion
11,910
3,291
3,291
Total Fees $439,899 $384,899 $339,400
The Capital Expansion Improvement Fees to be reimbursed to the Capital Expansion Fund by
the Sales and Use Tax Fund are shown below:
Fees
Actual
Amount to be
_ Type of Fee
Charged
Fees Due
Transferred
Fire Capital Expansion
4,827
17,865
12,726
General Gov't Capital
5,376
20,247
14,262
Police Capital Expansion
3,291
12,178
8,887
Total Fees $13,494 $49,370 $35,875
Councilmember Kastein withdrew from discussion on this item.
("Secretary's Note: Councilmember Kastein left the room at this point.)
Councilmember Mason made a motion, seconded by Councilmember Wanner, to adopt Ordinance
No. 1, 2000 on First Reading. The vote on the motion was as follows: Yeas: Councilmembers
Byrne, Martinez, Mason, Wanner and Weitkunat. Nays: None. (Councilmember Kastein out of
room)
THE MOTION CARRIED
("Secretary's Note: Councilmember Kastein returned to the meeting at this point.)
Resolution 2000-5
Endorsing Federal Legislation Requiring the Collection of
State and Local Sales and Use Taxes on Remote Sales Adopted
The following is staff s memorandum on this item.
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January 4, 2000
"Financial Impact
Revenue from the City's sales and use taxes is the largest revenue source for governmental
operations. In 1998, over half of the City's general fund came from the sales and use tax. In the
next budget year, the general fund is projected to receive over 60% of its total resources from sales
and use taxes. In addition to governmental operations, revenue from the sales and use taxes funds
debt service on several projects in the City, and provide for most of the governmental capital
projects that are being and will be built in the Building Community Choices projects.
Executive Summary
In 1998, Congress enacted a law that provided for a three-year moratorium on sales and use taxes
being charges on goods being sold over the Internet. The stated purpose of the law was to protect
Internet based commerce (e-commerce) in the formative stages of its development. Many large e-
commerce retailers convinced the Congress that this method ofsales needed protection from state
and local sales taxes in order to grow. Based on the studies of several national research
organizations,a-commerce is not onlygrowing, but is experiencing exponentialgrowth. Thevolume
ofsales over the Internet is doubling every 18 months. Some research indicates certain categories
of sales are growing even faster.
Allowing Internet sales to occur without regard for state and local taxes creates an inequity in tax
collection obligations between mainstreet hometown businesses and their electronic and mail -order
catalog competitors. Resolution 2000-5 expresses the Council's position that sales and use taxes
should be collected on all types of remote vendor sales in order to maintain an equitable system of
taxation.
BACKGROUND
In Colorado, the state and local governments share responsibilityfor the provision and funding of
local services. Home rule cities and towns have strong powers of fiscal autonomy which have
resulted in some very strong financial results for the major cities in Colorado. Through their tax
policies, local governments can match the appropriate revenue source with services being demanded
by their constituents. Therefore, Colorado municipalities have a strong and vested interest in
making sure that local retail businesses are robust and competitive.
Generally, what is good for a city's retail base is good for the community. Retail businesses create
jobs, bringjobs into the economy, and generate tax revenue with manypublic benefits. Local retail
employees spend their pay checks at other businesses in town, adding to the economic health of the
community. Busy retail stores helps cities avoid boarded -up storefronts and blight, helping foster
a sense of place and community pride. It is therefore in the mutual interest of locally -owned
businesses and local government officials to work together to eliminate conditions and policies that
put local businesses at an unfair market position. Under the current state of the law regarding
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January 4, 2000
collection of state and local taxes on Internet sales, "remote commerce" vendors are able to
compete in the local market without having to collect from their customers the taxes that local
retailers must collect. "Remote commerce" entails retail businesses that have no physical presence
in, and thus are not a part of, the local community, as are other retailers. These out-of-town
retailers compete for local customers by selling through mail order catalogs, over the telephone,
through televised advertising, and most recently through the Internet. Thepurchase ofthe materials
and goods that these out-of-town vendors are selling is generally already subject to tax within the
municipalities where the purchase order is placed. Thus, the issue is not whether to tax the
transaction. Instead, the issue is whether the out-of-state vendor should be responsible for
collecting the tax.
The need for federal legislation on this subject arises from a decision of the U.S. Supreme Court.
The Court has ruled, in effect, that vendors selling only by catalogue cannot be required to collect
local sales tax because these vendors do not have a sufficient `physical presence" within the
jurisdiction where the sale occurs to justify such a requirement. One can argue that this applies to
vendors who sell on the Internet as well. However, the Supreme Court has also said that Congress
is free to decide whether, when and to what extent local and state governments may burden such
interstate sales with the duty to collect local taxes. The Colorado Municipal League has urged
municipal officials throughout the state to work with local business people to make sure that our
congressional delegation understands that they should act to avoid perpetuating a tax policy that
favors remote commerce businesses over local businesses.
According to highly regarded economic research firms, sales over the Internet are expected to
surpass $108 billion and comprise over six percent ofall retail sales in the United States by 2003.
The National Mail Order Association reports mail order sales to retail consumers of $185 million
in 1998. Clearly, this is a significant fairness issue and one that results in lost revenue to the City
of Fort Collins.
Using data and reports available from various research firms over the Internet, City Finance
Department staffhave estimated the magnitude ofrevenue loss from e-commerce and catalogsales.
In 1998, the total loss is about $750, 000, with about two-thirds of the total from mail order catalog
sales. By 2003, the loss of sales and use tax revenue will be over $6 million, with over 80% of this
total from e-commerce. Beyond 2003, the number continues to grow dramatically."
City Manager Fischbach provided a brief introduction for the agenda item.
Alan Krcmarik, Finance Director, explained the City's position regarding internet and catalog sales
tax.
City Manager Fischbach noted that the issue is part of the Council policy agenda.
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January 4, 2000
Councilmember Byrne asked about the status of the three-year moratorium. City Manager
Fischbach stated that two bills are pending in the Senate to make it a permanent moratorium.
Councilmember Byme noted the complexity ofrequiring businesses to remit sales taxes to numerous
taxing districts. City Manager Fischbach stated that software experts indicate that it is possible with
current technology to remit sales tax to numerous taxing districts without any problem. Krcmarik
spoke regarding the capabilities of current technologies.
Councilmember Byme noted the possibility of inaction at the federal level and the impact on the
City's revenue and services. City Manager stated that Governor Owens is on record in opposition
to taxing internet sales.
Councilmember Byrne asked about projected revenue losses. Krcmarik stated that the next two-year
budget will be impacted by declining revenues.
Councilmember Weitkunat commented that this Resolution is preparatory for the future and that
there is a need for grassroots education on the issue.
Councilmember Kastein asked about the issue of the sellers collecting the tax. Krcmarik stated that
the key issue is whether the vendor has the duty and responsibility to collect the tax.
Councilmember Kastein expressed a concern regarding the City's reliance on sales tax revenues and
asked if the City is exploring the issue. City Manager Fischbach stated that the City is exploring
ways to change the mix of revenue sources.
Councilmember Wanner asked about the limit on property tax. Krcmarik spoke regarding the mill
levy cap.
Councilmember Byme made a motion, seconded by Councilmember Mason, to adopt Resolution
2000-5.
Councilmember Mason spoke regarding the need for education of small businesses regarding the
issue.
Councilmember Wanner stated that those who turn their backs on paying the sales tax are turning
their backs on infrastructure needs for the community.
Councilmember Byme spoke regarding the need to evaluate the services for which people are
willing to pay taxes.
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January 4, 2000
Mayor Martinez spoke regarding the importance of the issue and the difficulty of enforcement.
The vote on the motion was as follows: Yeas: Councilmembers Byrne, Kastein, Martinez, Mason,
Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
Other Business
Councilmember Weitkunat requested a copy of the most recent draft of the noise ordinance.
Councilmember Kastein asked for a copy of a confidential memo provided to boards and
commissions regarding flood plain regulations. He expressed an interest in providing additional
input at a study session on the proposed flood plain regulations before the staff recommendation is
prepared.
Councilmember Mason spoke regarding timing for appointments to fill boards and commissions
vacancies.
Councilmember Weitkunat spoke regarding discussions with the Commission on the Status of
Women regarding the size of the membership.
Councilmember Byrne spoke regarding citizen input at the December meeting regarding police
services issues and noted that no written communication has been received from any of the citizens.
He noted that he has received information from the Police Chief regarding training and outreach
activities.
Mayor Martinez requested that Councilmembers refrain from making statements regarding agenda
items until after a motion is made.
Councilmember Mason requested a one -page memorandum regarding activities planned for the
upcoming Earth Day in April.
Adjournment
Councilmember Wanner made a motion, seconded by Councilmember Weitkunat, to adjourn the
meeting to 6:00 p.m. on January 11, 2000 for the purpose of hearing the Old Town North appeal.
The vote on the motion was as follows: Yeas: Councilmembers Byrne, Kastein, Martinez, Mason,
Wanner and Weitkunat. Nays: None.
THE MOTION CARRIED
114
The meeting adjourned at 9:15 p.m.
ATTEST:
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January 4, 2000
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