HomeMy WebLinkAboutMINUTES-03/19/2013-RegularMarch 19, 2013
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, March 19, 2013,
at 6:00 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll call was answered
by the following Councilmember: Horak, Kottwitz, Manvel, Ohlson, Troxell and Weitkunat.
Councilmembers Absent: Poppaw
Staff Members Present: Atteberry, Nelson, Roy.
Agenda Review
City Manager Atteberry recommended changing the order of Item Nos. 28, First Reading of
Ordinance No. 057, 2013, Terminating the Moratorium Imposed by Ordinance No. 145, 2012 with
Respect to Oil and Gas Operations Conducted under an Oil and Gas Operator Agreement Between
the City and Prospect Energy, LLC and Item No. 29, Resolution 2013-025Adopting a Policy for
Developing Primary Employer Business Assistance Packages. Additionally, City Manager
Atteberry noted the April 2 meeting will not need to be cancelled as identified under Other Business.
Citizen Participation
Martha Coleman, 351 High Court, claimed an ethics violation has occurred with National
Association of Realtors' donations to Council campaigns.
Ross Cunniff, 2267 Clydesdale, discussed a campaign independent expenditure his campaign
received as a result of an endorsement from the Fort Collins Board of Realtors. He repudiated the
support and endorsement.
Mel Hilgenberg, 172 North College, discussed community events and suggested parabolic mirrors
be placed in the City parking structures to aid in pedestrian safety.
Virginia Farver, Fort Collins resident, discussed the dangers of AMI meters and stated residents
should be able to opt in rather than opt out of the program.
Dick Thomas, 1901 Wallenberg Drive, discussed ex parte communication and alleged it is unethical
to prevent citizen input.
Devin Himing, 2214 Fossil Creek Parkway, shared concerns relating to ex parte communications
and expressed concern regarding the National Board of Realtors' election contributions.
464
March 19, 2013
Citizen Participation Follow-up
Mayor Pro Tern Ohlson asked if it would be possible to present information regarding other
communities' dealings with ex parte contacts to Mr. Thomas. He noted citizens are allowed to speak
about projects not yet in the planning process.
Councilmember Horak noted most other municipalities in Colorado have entirely new hearings for
appeals; however Fort Collins has a hearing on the record, therefore disallowing new testimony and
information. He stated there was some research completed regarding the parabolic mirrors in the
parking structures which resulted in inconclusive results as to whether or not the mirrors aid in
safety.
Councilmember Horak noted there is little way to exclude donations from campaigns.
Councilmember Kottwitz noted there are other organizations donating money for and against various
campaigns.
Mayor Weitkunat asked if there is any information on possible dangers of the AMI meters provided
to customers. City Manager Atteberry stated he would respond to the issue at a future Council
meeting.
CONSENT CALENDAR
6. Consideration and Approval of the Minutes of the February 19, and March 5, 2013 Regular
Meetings, and the February 12, February 26, and February 28, 2013 Adjourned Meetings.
7. Second Reading of Ordinance No. 034, 2013, Appropriating Unanticipated Revenue from
the Colorado Department of Transportation into the Mulberry to Lemay Pedestrian Bridge-
Poudre Trail project in the Capital Projects Fund.
The City's'Engineering and Park Planning Departments were awarded a grant from the
federally funded North Front Range Metropolitan Planning Organization totaling $368,000
for the relocation of two existing steel pedestrian bridges and the construction of a new
concrete section of the Poudre trail. The general vicinity of the project is between Mulberry
Street and Lemay Avenue, along the north side of the Poudre River. This project will build
the trail, bridge abutments and piers to receive one of the relocated pedestrian bridges. This
Ordinance, unanimously adopted on First Reading on March 5, 2013, appropriates the grant
money for the project.
18. Second Reading of Ordinance No. 035, 2013, Establishing Rental Rates and Delivery
Charges for the City's Raw Water for the 2013 Irrigation Season.
This Ordinance, unanimously adopted on First Reading on March 5, 2013, approves
procedures and rates for the rental and delivery of the City's raw water supplies. The Water
Utility uses these rates to assess charges for agricultural use, for various contractual raw
water obligations and for raw water deliveries to City departments and other entities. The
proposed rate for each type of water is based on several factors, including market conditions
465
March 19, 2013 .
and assessments charged by irrigation companies. Rentals in 2013 will be substantially
limited and different than past years due to fire and drought related water supply issues.
9. Second Reading of Ordinance No. 036, 2013, Authorizing the Purchasing Agent to Enter
into an Agreement for the Financing of Vehicles and Equipment for Various Cif
Del2artments by Lease -Purchase.
The City of Fort Collins is lease -purchasing vehicles and equipment for various City
departments. This Ordinance, unanimously adopted on First Reading on March 5, 2013,
authorizes the Purchasing Agent to enter into a lease -purchase financing agreement with
Pinnacle Public Finance at an interest rate of 2.23%. The cost of the -items to be lease -
purchased is $2,543,005. Payments at the 2.23% interest rate will not exceed $269,450 in
2013. Money for 2013 lease -purchase payments is included in the 2013 budget requests.
The effect of the debt position for the purpose of financial rating of the City will be to raise
the total City debt by 2.0%. A competitive process was used to select Pinnacle Public
Finance for this lease. Staff believes acceptance of this lease rate is in the City's best
interest.
10. Second Reading of Ordinance No. 037, 2013 RenealinR Ordinance No. 065, 1999
Resolution1996-073 and Resolution 1988-081; Making Certain Amendments to the City
Code and Land Use Code to Allow for the Discretionary Waiver of City Fees for Certain
Kinds of Housing Authority Proiects to Be Constructed in the City; and Authorizing an
Aueement Between the City and the Housing Authority with Regard to Such Waivers.
Colorado statutes and a City ordinance exempt projects of the Fort Collins Housing
Authority (FCHA) from City taxes and fees and, for many years, the City has waived fees
for such projects. For the most part, the projects have been relatively small. In 2011, the
Housing Authority partnered with CARE Housing, a non-profit agency, on an affordable
housing project in the Provincetown subdivision. Although the interest of the Housing
Authority in the project was small (technically a .001 % partner), a waiver of City fees for
the CARE Housing Provincetown Project was requested and granted by the City Council.
The fee waiver totaled $557,378. The magnitude of the waiver, as well as the fact that the
Housing Authority held only a minor ownership interest in the project, prompted staff to
examine the fee waiver policy for future Housing Authority projects. At a subsequent work
session of the Council, staff was directed to provide some options for future projects,
especially those in which the Housing Authority has only a minor interest. This Ordinance,
unanimously adopted on First Reading on March 5, 2013, allows for the discretionary waiver
of City fees for the Fort Collins Housing Authority and to limit waivers to. certain kinds of
projects.
11. Second Reading of OrdinanceNo.038,2013, Extending the Contract ofthe City'sEmploye
e
Wellness Program Software Provider.
The City has contracted with the Mayo Foundation for Medical Education and Research
(Mayo) to provide services associated with the assessment and management of existing and
potential health risks of City employees. These services allow the City of Fort Collins
Human Resources Department to collect and analyze data and support efforts to manage
rising healthcare costs. Services provided by Mayo include employee health risk
Im
March 19, 2013
assessments, health information and education, support for behavior modification, and
disease management. These services are an integral part of the City's wellness and employee
health benefit programs. Additionally, some organizations are integrating these services
with an Onsite Employee Medical Clinic. There may be possible cost savings, efficiency and
effectiveness benefits associated with this model. As the first step toward evaluating costs,
benefits and options associated with a possible Onsite Employee Medical Clinic, the City
will release a Request for Proposal (RFP) in the spring of 2013. Vendors will be asked to
respond to the City's interest in evaluating proposals that incorporate these services into the
clinic model. This Ordinance, unanimously adopted on First Reading on March 5, 2013 will
extend the City's contract and allow time to evaluate options associated with a clinic while
continuing usage of services provided by Mayo.
12. Second Reading of Ordinance No. 039, 2013 Amending the City Code and Creating a
Parking Advisory Board.
This Ordinance, unanimously adopted on First Reading on March 5, 2013, creates a Parking
Advisory Board. During the discussion at the First Reading of the Ordinance, Council
requested more information about the public process, membership, geographical area, and
costs of the potential Board. The remainder of this agenda item summary contains the
information requested by City Council.
The Ordinance has been amended for Second Reading to include "downtown employees"
.on the list of potential downtown members of the Board.
13. Second Reading of Ordinance No. 040, 2013, Amending Section 2.2.11(C) of the Land Use
Code Re ag rdine the Period of Time that Project Development Plans and Plats for Large Base
Industries Remain in Effect.
This Ordinance, unanimously adopted on First Reading on March 5, 2013, amends Land Use
Code (LUC) Section 2.2.11(c), regarding a Project Development Plan and Plat to allow for
the approval of a final plan within a twenty-five (25) year period of time for a Large Base
Industry to be constructed in phases and as defined in Article 5 of the LUC.
14. Second Reading of Ordinance No. 042, 2013, Authorizing the Conveyance of a Non -
Exclusive Drainage Outfall Easement and a Temporary Construction Easement on Archery
Range Natural Area to Cottonwood Land and Farms, LLC.
This Ordinance, unanimously adopted on First Reading on March 5, 2013, authorizes the
conveyance of a twenty -foot wide permanent non-exclusive drainage easement and a twenty -
foot wide temporary construction easement, both approximately sixty feet in length across
a small portion of Archery Range Natural Area to Cottonwood Land and Farms. The
purpose of the easement is to install a 12-inch buried pipe to convey water from
Cottonwood's East Rigden Pit to the Cache la Poudre River. The buried outfall pipe crossing
Archery Range.is part of a larger 2,700 linear foot drainage outfall pipe constructed on
adjacent properties. The project site is located generally on the "Rigden Pit" property and
the "Port of Entry Pit" property northeast of Horsetooth Road and Ziegler Road.
Alternatives to this preferred alignment proved prohibitive both from an economic and
engineering standpoint
467
March 19, 2013
15. Items Relating to the Conveyance of Easements on Salver Natural Area to Charles
Meserlian.
A. Second Reading of Ordinance No. 043, 2013, Authorizing the Conveyance of a Non -
Exclusive Drainage Easement on Salyer Natural Area to Charles Meserlian.
B. First Reading of Ordinance No. 051, 2013, Authorizing the Conveyance of a Non -
Exclusive Drainage and Landscaping Easement and an Access Easement on the
Hickory Trail Property to Charles Meserlian.
Charles Meserlian (the "Developer") is planning a 1.89 acre live/work residential
development called Hickory Commons (the "Development") located in the 300 block of
Hemlock Street, immediately north of the City's Salyer Natural Area and east of City -owned
property known as the Hickory Trail. The Development requires off -site drainage and
landscaping improvements on the Hickory Trail property. In order the complete the
installation of the planned improvements, the Developer is requesting that the City grant a
3,601 square foot non-exclusive drainage and landscaping easement and an access easement
on City -owned property.
The Development also requires a drainage easement on Salyer Natural Area for the
discharge of stormwater that will be collected in a detention pond on the Development
property and then released at a controlled rate through a buried pipeline within the Hemlock
Street right-of-way. This easement only allows stormwater to cross the Salyer Natural Area
Property to the Cache la Poudre River and does not involve construction of any
improvements on Natural Areas Department property.
Ordinance No. 043, 2013, unanimously adopted on First Reading on March 5, 2013,
authorizes the conveyance of the non-exclusive drainage easement on the Salyer Natural
Area to the Developer. Ordinance No. 051, 2013, would authorize the conveyance of the
non-exclusive drainage and landscaping easement and access easement on the Hickory Trail
property.
16. Items Relatingto o Expanding the Boundaries of the Downtown Development Authority.
A. Second Reading of Ordinance No. 045, 2013, Expanding the Boundaries of the Fort
Collins Downtown Development Authority and Amending the Plan of Development
of the Authority to Include Property Presently Known as the Max Flats Properties.
B. Second Reading of Ordinance No. 049, 2013, Expanding the Boundaries of the Fort
Collins Downtown Development Authority and Amending the Plan of Development
of the Authority to Include Property Presently Known as the Link-N-Greens
Property.
These Ordinances, unanimously adopted on First Reading on March 5, 2013, expand the
boundaries of the Fort Collins Downtown Development Authority and amend the Plan of
Development of the Authority to include a property in the 200 block of West Mulberry
Street and a property in the 700 block of East Lincoln Avenue. The properties include the
ZE:
March 19. 2013
former locations of Mason Automotive and King's Auto (southwest corner of Mulberry and
Mason Streets) and the Link-N-Greens golf course.
17. First Reading of Ordinance No. 052, 2013, Appropriating Prior Year Reserves in the Water
Fund for the Construction of a Pre --Sedimentation Basin as Part of the High Park Fire
Remediation.
The 2013 Budget for the Water Fund included $987,953 for BFO Offer 244.1 — Fire
Mitigation Capital Improvements. After further evaluation of the potential ways capital
investment could improve the ability of Fort Collins Utilities to treat water from the Cache
la Poudre watershed, a pre -sedimentation basin is being constructed. The total cost of this
basin will be $2,150,000.
This Ordinance appropriates $1,250,000 from the Water Fund reserves so that the
construction of the pre -sedimentation basin can be completed and operational before June
2013. .
18. First Reading of Ordinance No. 053, 2013, Designating ating the Oliver and Leota Chandler
Property, 710 Mathews Street, as a Fort Collins Landmark Pursuant to Chapter 14 of the
City Code.
The owner of the property, Barbara Liebler, is initiating this request for Fort Collins
Landmark designation for the Oliver and Leota Chandler Property at 710 Mathews Street.
19. First Reading of Ordinance No. 054, 2013, Authorizing Revisions to the Master Covenant
for the Affordable Housing Units in the Provincetowne Condominiums Development.
This Ordinance authorizes revisions to the Master Covenant for the affordable housing units
in the Provincetowne Condominiums development that would eliminate the requirement
contained in the existing Covenant that future purchasers of the condominium units must
qualify as being low-income families and modify the way that sales price limitations are
calculated. The revised Covenant would retain the requirement that the units must be owner -
occupied. The goal is to make it easier for owners of affordable units to find buyers for their
units when they need or want to sell them. Staff is not recommending that the Covenant be
released completely, because staff believes that the maximum sales price and owner -
occupancy restrictions in the Covenant are useful to retain. The Affordable Housing Board
recommends approval of the proposed changes to the Master Covenant.
20. Resolution 2013-021 Approving an Intergovernmental Agreement Between the City of Fort
Collins, Platte River Power Authority, the Town of Estes Park, the City of Loveland and the
City of Longmont for Participation in a Joint Compensation Study.
Fort Collins Utilities Light & Power is partnering with Platte River Power Authority, the
Town of Estes Park, the City of Loveland, and the City of Longmont in hiring a consultant
to perform a comprehensive compensation study for certain power utility positions. The
results of this study will provide valuable market analysis, furthering the efforts to attract
and retain key positions within the electric industry.
March 19, 2013
21. Resolution 2013-022 Directing that the Proceeds from the Public Service Company of
Colorado Pipeline Project Be Used for Trails and Natural Areas.
Public ServiceCompany of Colorado (PSCo) is constructing a high pressure gas pipeline
through Fort Collins. PSCo has agreed to pay the City $2 million as mitigation for the
project impacts and as compensation for easements across four natural areas. Adoption of
the Resolution directs the $2 million PSCo payment shall be used only for trails and natural
areas
22. Resolution 2013-023 Making an Appointment to the Landmark Preservation Commission.
This Resolution fills one vacancy on the Landmark Preservation Commission.
***END CONSENT***
Ordinances on Second Reading were read by title by City Clerk Nelson.
Second Reading of Ordinance No. 034, 2013, Appropriating Unanticipated Revenue from
the Colorado Department of Transportation into the Mulberry to Lemay Pedestrian Bridge-
Poudre Trail project in the Capital Projects Fund.
Second Reading of Ordinance No. 035, 2013, Establishing Rental Rates and Delivery
Charges for the City's Raw Water for the 2013 Irrigation Season.
9. Second Reading of Ordinance No. 036, 2013, Authorizing the Purchasing Agent to Enter
into an Agreement for the Financing of Vehicles and Equipment for Various City
Departments by Lease -Purchase.
10. Second Reading of Ordinance No. 037, 2013 Repealing Ordinance No. 065, 1999,
Resolution1996-073 and Resolution 1988-081; Making Certain Amendments to the City
Code and Land Use Code to Allow for the Discretionary Waiver of City Fees for Certain
Kinds of Housing Authority Projects to Be Constructed in the City; and Authorizing an
Agreement Between the City and the Housing Authority with Regard to Such Waivers.
11. Second Reading of Ordinance No. 038,2013, Extending the Contract of the City's Employee
Wellness Program Software Provider.
12. Second Reading of Ordinance No. 039, 2013 Amending the City Code and Creating a
Parking Advisory Board.
13. Second Reading of Ordinance No. 040, 2013, Amending Section 2.2.11(C) of the Land Use
Code Regarding the Period of Time that Project Development Plans and Plats for Large Base
Industries Remain in Effect.
14. Second Reading of Ordinance No. 042, 2013, Authorizing the Conveyance of a Non -
Exclusive Drainage Outfall Easement and a Temporary Construction Easement on Archery
Range Natural Area to Cottonwood Land and Farms, LLC.
March 19, 2013
15. Second Reading of Ordinance No. 043, 2013, Authorizing the Conveyance of a Non -
Exclusive Drainage Easement on Salyer Natural Area to Charles Meserlian.
16. Items Relating to Expanding the Boundaries of the Downtown Development Authority.
A. Second Reading of Ordinance No. 045, 2013, Expanding the Boundaries of the Fort
Collins Downtown Development Authority and Amending the Plan of Development
of the Authority to Include Property Presently Known as the Max Flats Properties.
B. Second Reading of Ordinance No. 049, 2013, Expanding the Boundaries of the Fort
Collins Downtown Development Authority and Amending the Plan of Development
of the Authority to Include Property Presently Known as the Link-N-Greens
Property.
27. Second Reading of Ordinance No. 041, 2013, Amending the Land Use Code to Address
Certain Recommendations Contained in the Student Housing Action Plan.
Ordinances on First Reading were read by title by City Clerk Nelson.
15. First Reading of Ordinance No. 051, 2013, Authorizing the Conveyance of a Non -Exclusive
Drainage and Landscaping Easement and an Access Easement on the Hickory Trail Property
to Charles Meserlian.
17. First Reading of Ordinance No. 052, 2013, Appropriating Prior Year Reserves in the Water
Fund for the Construction of.a Pre -Sedimentation Basin as Part of the High Park Fire
Remediation.
18. First Reading of Ordinance No. 053, 2013, Designating the Oliver and Leota Chandler
Property, 710 Mathews Street, as a Fort Collins Landmark Pursuant to Chapter 14 of the
City Code.
19. First Reading of Ordinance No. 054, 2013, Authorizing Revisions to the Master Covenant
for the Affordable Housing Units in the Provincetowne Condominiums Development.
28. First Reading of Ordinance No. 057, 2013, Terminating the Moratorium Imposed by
Ordinance No. 145, 2012 with Respect to Oil and Gas Operations Conducted under an Oil
and Gas Operator Agreement Between the City and Prospect Energy, LLC.
Mayor Pro Tern Ohlson withdrew Item No. 17, First Reading of Ordinance No. 052, 2013,
Appropriating Prior Year Reserves in the Water Fund for the Construction of a Pre -Sedimentation
Basin as Part of the High Park Fire Remediation from the Consent Calendar.
Councilmember Troxell withdrew Item No. 21, Resolution 2013-022 Directing that the Proceeds
from the Public Service Company of Colorado Pipeline Project Be Used for Trails and Natural
Areas from the Consent Calendar.
471
March 19, 2013
Councilmember Horak withdrew Item No. 19, First Reading of Ordinance No. 054, 2013,
Authorizing Revisions to the Master Covenant for the Affordable Housing Units in the
Provincetowne Condominiums Development from the Consent Calendar.
CouncilmemberManvel made a motion, seconded by Councilmember Troxell, to adopt and approve
all items not withdrawn from the Consent Calendar. Yeas: Weitkunat, Manvel, Kottwitz, Ohlson,
Horak and Troxell. Nays: none.
THE MOTION CARRIED.
Councilmember Reports
Councilmember Troxell commended the City on its receipt of the Hart award. He reported on the
National League of Cities meeting in Washington D.C.
Councilmember Horak reported on a meeting with the Federal Railroad Administration and other
meetings at the National League of Cities.
Ordinance No. 052, 2013,
Appropriating Prior Year Reserves in the Water Fund for the Construction of a Pre -
Sedimentation Basin as Part of the High Park Fire Remediation. Adopted on First Reading
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
The 2013 Budget for the Water Fund included $987, 953 for BFO Offer 244.1 — Fire Mitigation
Capital Improvements. After further evaluation of the potential ways capital investment could
improve the ability of Fort Collins Utilities to treat waterfrom the Cache la Poudre watershed, a
pre -sedimentation basin is being constructed. The total cost of this basin will be $2,150,000.
This Ordinance appropriates $1,250, 000 from the Water Fund reserves so that the construction of
the pre -sedimentation basin can be completed and operational before June 2013.
BACKGROUND /DISCUSSION
The High Park Fire, which began on June 9, 2012 and ended on July 11, 2012, has severely affected
the Cache la Poudre watershed. The City has a large vested interest in the quality of water in the
Poudre River. Since the fire, the water quality after any rain or snow melt has been, and will
continue to be, challenging to treat. This pre -sedimentation basin is designed to remove sediment
from the water before it is treated for our community.
The pre -sedimentation basin, currently under construction, is located at the Munroe Turnout at the
Pleasant Valley Pipeline. The sediment removalfrom the basin will allowfor a more consistent raw
water quality coming into the plant, which is beneficial for determining chemical additions, process
control and other treatment strategies. It will also remove.sediment that is normal in the river
during the spring run offseason, where debris is carried into the water treatment facility pipelines
and affects treatment. Given the current drought conditions, being able to treat as much water as
472
March 19, 2013
possible from both of the major watersheds serving Fort Collins Utilities customers is vital to
meeting the community's water needs in 2013.
Staff will continue to update the City Council and community as more information becomes
available. Based on literature of watershed fires, we could experience negative effects for years
after this fire. In addition, these negative effects will change as the years go by, with immediate
effects being the presence of ash and sediment in the River and longer term changes to the water
quality such as metals concentration and algae growth leading to taste and odor issues are
anticipated. Denver Water, for example, is still dealing with the Hayman fire more than a decade
later.
FINANCIAL /ECONOMIC IMPACTS
Our region is known for its high quality water and the economic impact is significant to our city.
Many businesses have located here specifically because our water exceeds drinking water
standards. Without this pre -sedimentation basin it may not be possible to treat water from the
Poudre River at times this summer which could require tighter water restrictions. Tighter
restrictions could, in turn, have some f nancial impact on the commercial customers served by Fort
Collins Utilities as well as a loss of revenue to the utility itself. With this capital investment it may
be possible to avoid tighter water- restrictions and minimize the associated potential financial
impacts to the community.
By appropriating funds out of the Water Fund reserves, this capital investment can be recovered
through rates over several years rather than immediately.
ENVIRONMENTAL IMPACTS
The City of Fort Collins along with two other water providers together serve over 320, 000 citizens
with high quality drinking water in northern Colorado. The ability to treat the Poudre River water,
regardless of the raw water quality, is vital to the City's water supply and demand policy. The basin
will also facilitate removal of the sediment from the river system, which will reduce the negative
impact on downstream users of the river system. "
Mayor Pro Tem Ohison asked why the money is just now being allocated for the pre -sedimentation
basin, which is already under construction. Kevin Gertig, Water Resources and Treatment
Operations Manager, replied the pre -sedimentation basin was needed urgently; design and
construction began within four weeks. The project has been referenced but details were not known
until now. City Manager Atteberry noted this is not the typical process, but conversations were held
with Councilmembers regarding this issue in the fall.
Mayor Pro Tern asked if the two other water providers are paying part of the cost of the basin.
Gertig replied the City will request the other providers fund their fair share; however, due to the
compression of the time schedule and need to get the basin on-line, those discussions have yet to
occur. He stated he will return to Council with further details.
Mayor Pro Tern asked if it would have been possible to have the Water Board have a special
meeting to provide feedback. Gertig replied this was vetted to the Water Board as an update.
473
March 19, 2013
Mayor Pro Tern Ohlson stated a photograph would have been helpful in the staff report and asked
if an environmental review was required. Gettig replied the basin is on private property owned by
the Northern Colorado Water Conservancy District and is located three or four miles from the
Poudre River.
Mayor Pro Tern Ohlsori asked if the structure would be permanent. Gertig replied it is essentially
permanent. Photographs will be provided and any interested Councilmember may have a site tour.
Councilmember Horak made a motion, seconded by Councilmember Manvel, to adopt Ordinance
No. 052, 2013, on First Reading.
Councilmember Horak requested additional clarification regarding the timing of this item.
The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Horak and
Troxell. Nays: none.
THE MOTION CARRIED.
Ordinance No. 054, 2013,
Authorizing Revisions to the Master Covenant for the Affordable Housing
Units in the Provincetowne Condominiums Development, Postponed Indefinitely
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
This Ordinance authorizes revisions to the Master Covenant for the affordable housing units in the
Provincetowne Condominiums development that would eliminate the requirement contained in the
existing Covenant that future purchasers of the condominium units must qualify as being low-income
families and modify the way that sales price limitations are calculated. The revised Covenant would
retain the requirement that the units must be owner -occupied and set a new Maximum Purchase
Price Limit. The goal is to make it easier for owners ofaffordable units to find buyersfor their units
when they need or want to sell them. Staff is not recommending that the Covenant be released
completely, because staff believes that the maximum sales price and owner -occupancy restrictions
in the Covenant are useful to retain. The Affordable Housing Board recommends approval of the
proposed changes to the Master Covenant.
BACKGROUND /DISCUSSION
Section 23-111 of the City Code requires City Council authorization by ordinance before the City
can sell, convey or otherwise dispose of any interest in real property owned by the City. By
executing the Master Covenant, the original Provincetowne Condominium unit owners agreed to
restrict the use and resale of their units, and gave the City the power to enforce those restrictions.
This constitutes an interest in the Provincetown Condominiums that is owned by the City. By
amending the Covenant to reduce the restrictions on resale of the units, the City would be giving up
part of its property interest in the units. .
The proposed revised Master Covenant:
474
March 19, 2013
Eliminates the "Eligible Buyer" (i.e., low-income family) requirement;
Retains the owner -occupancy requirement, and
Changes the maximum purchase price of the units to be 95% of the Area Median Purchase
Price as published quarterly by the National Association of Home Builders, instead ofbeing
based on a calculation of the amount an "Eligible Buyer" can afford.
Attachment 1 presents a redline/strikeout version of the Revised Master Covenant showing the
changes being made to the 2006 Master Covenant.
Brief History
In the mid-1990s, the City of Fort Collins received the Provincetowne property, consisting of
approximately 330 acres, through the financial failure ofa Special improvement District (SID). The
City Council's goals at that time were to sell the SID property and recover the City's costs, while
meeting community goals for affordable housing and preservation of land for public facilities. In
1995, the City Council directed staff to market 170 acres of the Provincetowne SID property with
an affordable housing "demonstration component. " The remaining approximately 160 acres was
separately purchased by the City's Department ofNatural Resources to be used as a natural area.
The City used a "request for proposal" process to market the property and eventually sold the
property to PrideMark Development Company, L.L.C. for $1,800,000, with an agreement that at
least 30% of the development project would be affordable housing that could only be sold to an
"Eligible Buyer, " meaning a person, family or household whose annual income is no more than
80% of the Area Median Income for Fort Collins, and whose housing expenses would not exceed
38% of their income. The affordable units would have to be kept afforddble for 25 years.
In 1998, Kaufman and Broad (K-B Homes) acquired Pridemark and started building the required
affordable housing units as part of the Provincetowne Condominiums development (see Attachment
2 for a map showing the location of the Provincetowne Condominiums).
Through the sale of the SID property at a price below market value, the City of Fort Collins
essentially subsidized the development of 90 units as affordable housing out of a total of 120
condominiums in the Provincetowne development in order to provide home ownership opportunities
for low-income.families. To help perpetuate the affordability of the units into the future, the City
had the initial purchasers ofthe units sign, and subsequent owners acknowledge, a Master Covenant
containing three key provisions that:
1. Limited the sale of the units to "Eligible Buyers" as described above (again, City subsidy
to the project was for low income home ownership purposes).
2. Restricted the future sales price of the units to the maximum amount that an Eligible Buyer
would be able to finance'with a 30 year loan at market rate interest, so that the units would
remain affordable to low income families (this would prevent an initial/subsequent owner
from gaining a "windfall "profit due to the City subsidy of the initial/subsequent unit price).
3. Restricted the units to be owner occupied (again, the City's subsidy was to provide
affordable home ownership opportunities and create an owner occupied
development/neighborhood, not to allow investors to purchase the units as rentals, even
though they may still be affordable rentals for low income families).
475
March 19, 2013
The Master Covenant also contained specific provisions about the City's remedies in the event that
a unit owner violated the covenants, and about what would happen to the Covenant in the event that
a unit was foreclosed on.
In 2006, the City submitted its Provincetowne Covenant to FHA for review and "approval. " This
review showed that the City needed to make several changes to the Master Covenant in order to
make it consistent with HUD regulations. For example, the Master Covenant said that the City
would release the Covenant on a unit in the event of foreclosure or deed in lieu of foreclosure on
the unit, if the City first got an option to buy the unit. This was not consistent with a HUD
regulation that requires that covenants terminate automatically in the event of a foreclosure. In
addition, some of the remedies the City had under the Master Covenant were not consistent with
HUD regulations. The City then drafted, and HUD approved, a Revised Master Covenant that
corrected these discrepancies. The City began using the 2006 Revised Master Covenant in October
2006, and notified the owners of affordable units in Provincetowne that before putting their units
on the market they should contact the City about signing the 2006 Revised Master Covenant.
Approximately 69 of the Provincetowne affordable housing units are still restricted by either the
initial Master Covenant or the 2006 Revised Master Covenant.
In the fall of 2011, the City learned that the Provincetowne area lost its "certification "for FHA
insured mortgage financing. It became the City's understanding that the loss was based on three
"factors. " First, the Provincetowne HOA failed to submit the proper recertification paperwork
before the required deadline; second, there was a concern that there were not enough owner
occupied units remaining in the project (staff's understanding is that there is a 51 %minimum owner
occupancy required by FHA); and third, FHA wanted the City to revise its Covenant to remove the
income limitation on.future purchasers.
The City has since learned that the Provincetowne units are again FHA compliant. The area was
reinstated on July 24, 2012. That certification will expire July 24, 2014, unless a recertification is
requested by the HOA. In rechecking with FHA about whether the City had to eliminate the low-
income requirement for future purchasers contained in the existing Covenant, FHA responded that
as long as all deed restrictions on all units in the project terminate upon foreclosure, FHA has no
further issues with the Covenant.
However, over the past year and a half or so, staff has heard,from realtors and owners regarding
the pending sale of their Provincetowne units, complaining that it is hard to find income -qualified
buyers far units, and that there is not a level playing field, from their perspective, because of the
Covenant. Again, the Covenant only applied to initially 90 of 120 units. The original number of 90
units has been subsequently reduced to just 69 units mainly through foreclosures, because once a
unit is foreclosed, the Covenant is released.
Apparently, over the past year several Provincetown condominium units have been sold to
purchasers that are not qualified as low-income families. In addition, there is information that
implies that perhaps 10 of the remaining 69 units may not be owner occupied. Both cases represent
violations of the Covenant. Staff is not sure how such situations can happen unless realtors and/or
title companies are not thoroughly reviewing the Covenant. Also, there is a section of the Covenant
that requires the seller to notify the City if they are considering sale of their unit and for potential
purchasers to check with the City to assure the sale price is within the maximum limits allowed by
476
March 19, 2013
the Covenant. If the City had been properly notified the requirements of the Covenant would have
been known to the seller, purchaser, and/or their realtors long before sale closings were scheduled.
In 2012, the Affordable Housing Board appointed a subcommittee to work with staff to review the
2006 Revised Master Covenant and see iffurther changes were warranted. The results of the staff
subcommittee's work were presented to the entire AHB for discussion and a recommendation to the
City Council.
Based on the concerns that have been raised about the effect of the Eligible Buyer- restriction in the
Covenant as well as other considerations, City staff and the AHB are recommending that a new
2013 Revised Master Covenant be adopted. The 2013 Revised Master Covenant would accomplish
the following:
1. Eliminate the Eligible Buyer requirement so that future purchasers would not have to be
low-income families;
2. Redefine the maximum purchase price to be 95% of the Area Median Purchase Price as
published quarterly by the National Association of Home Builders, rather than being
calculated based on what an Eligible Buyer can afford;
3. Retain the owner occupancy requirement because the units were originally sold to buyers
with the indication that they would be living in an owner -occupies neighborhood,
4. Retain the changes that the City made to the Covenant in 2006 to make the Covenant
consistent with HUD regulations; and
5. Make additional changes to improve the clarity and accuracy of the Covenant and ensure
compliance with HUD regulation.
A copy of the 2013 Revised Master Covenant, showing changes compared to the 2006 Revised
Master Covenant, is attached as Attachment 1. If the 2013 Revised Master Covenant is approved,
Provincetowne residents whose units are currently restricted by one ofthe previous covenants would
be contacted and encouraged to execute the new Revised Master Covenant at their earliest
convenience or prior to the sale of their units. "
Councilmember Horak questioned the reason behind this item and asked how it will benefit citizens.
Mayor Pro Tern Ohlson expressed concern related to the fact that these units were supposed to be
owner -occupied and many are not.
Ken Waido, Chief Planner, replied the City subsidized the construction of 90 townhomes. KB
Homes completed the construction and sold the units to low-income families at below market prices.
The townhomes were sold under the concept that the project would be owner -occupied; there were
certain conditions upon resale. The three major components of the first master covenant were: the
purchaser and future purchasers had to be low-income residents; the price had to be affordable to
low-income residents; and the units had to remain owner -occupied. The Federal Housing
Administration raised a concern with some of the provisions of that master covenant, particularly
the income restriction on future purchasers. The Covenant was to be amended in the mid-2000s;
however, it was discovered that amendment was never made. A maximum sales price limitation and
the requirement that the units be owner -occupied are still part of the covenant.
477
March 19, 2013
Waido stated 21 of the units have gone through foreclosure and the covenant was released on the
foreclosed properties. Staff has determined it is possible that ten of the 69 remaining units have
been rented. Waido reviewed the staff recommendation.
Ross Cunniff, 2267 Clydesdale, questioned the 95%ofthe median metric being used and asked what
metrics will be used to measure success.
Niel Smosna, 6721 Rose Creek Way, stated she recently tried to sell her unit in Provincetowne and
was made aware of the covenant only as the sale was about to close. She stated she had never been
made aware of these restrictions since the purchase of her home and supported the removal of the
income restriction.
Valerie Schlageter, 375 East Horsetooth, The Group Real Estate, supported the Ordinance.
Mayor Pro Tem Ohlson noted the City intended to keep the units affordable and owner -occupied.
He asked what the City can do in the future to assure these types of projects remain as intended.
Waido clarified the Affordable Housing Board is recommending the income limit on future
purchasers be removed from the covenant; however, Council can ultimately opt to not remove that
item.
Councilmember Manvel suggested there should be an enforcement policy, perhaps in the form of
a lien, should these restrictions not be met.
Bruce Hendee, Chief Sustainability Officer, stated staff would work on a strategy to ensure
accountability on future projects.
Mayor Pro Tem Ohlson asked how the rental issue will be addressed. Waido replied letters will be
sent to owners informing them that they are in violation of the covenant, which does have penalties
associated with non-compliance of the covenant provisions. Owners will then be given the
opportunity to correct the situation.
Mayor Pro Tem Ohlson questioned the 95% metric. Waido replied the covenant written in 2006
combined some calculations which tied the family income to the purchase price of the unit. When
the Affordable Housing Board looked at removing the income requirement, it needed a standard
metric to be used for the maximum purchase price. At this point, that metric is higher than the
market prices for the units.
Mayor Pro Tem Ohlson asked if the item could be postponed. City Manager Atteberry replied the
item could be tabled until further information can be ascertained.
Councilmember Horak asked about the consequences for violations of the covenant. Laurie
Kadrich, Community Development and Neighborhood Services Director, replied consequences
include the City having a right to repurchase a unit and pursuing any legal remedies necessary.
Councilmember Horak asked what type of monitoring has been done since the issue arose in 2006
and requested an examination of the reasons behind this issue.
BE
March 19, 2013
Councilmember Manvel made a motion, seconded by Mayor Pro Tern Ohlson, to postpone the item
until staff is able to report back on an evaluation of the options related to the covenant.
Councilmember Horak suggested working with the Board of Realtors on this item.
Councilmember Manvel noted there are homeowners needing answers and requested an expedient
solution.
The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Horak and
Troxell. Nays: none.
THE MOTION CARRIED.
Resolution 2013-022
Directing that the Proceeds from the Public Service Company of
Colorado Pipeline Project Be Used for Trails and Natural Areas, Adopted
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
Public Service Company of Colorado (PSCo) is constructing a high pressure gas pipeline through
Fort Collins. PSCo has agreed to pay the City $2 million as mitigation for the project impacts and
as compensation for easements across four natural areas. Adoption of the Resolution directs the
$2 million PSCo payment shall be used only for trails and natural areas.
BACKGROUND / DISCUSSION
At the February 5, 2013 Council meeting, Council unanimously approved four ordinances conveying
easements to PSCo on four natural areas needed for the pipeline project. PSCo agreed to pay the
City 2 million dollars as mitigation for overall project impacts and as compensation for the value
of the natural area easements. PSCo did not place restrictions on the use of the $2 million.
The City has been conducting a paved trail study over the past several months and the information
from the study is being used to develop a Paved Trail Master Plan. Staff estimates the cost to build
out the paved trail system is $24 million for 30.7 miles of trail. It will take 50 years to complete the
trail system at current Conservation Trustfunding levels ($470,000 annually), reduced to 25 years
ifa trail capital expansionfee is created. Utilizing some or all ofthe PSCofundsfor trails will help
to complete key sections of this highly valued community asset.
The Natural Areas Department (NAD) has a significant number ofland conservation and restoration
projects in process. Using some or all ofthe PSCofunds for natural areas acquisition, conservation
or restoration will enable the NAD to pursue projects that would otherwise have to be delayed,
bypassed or reduced in scope.
At the February 5, 2013 Council meeting, Council unanimously approved four ordinances conveying
easements to PSCo on four natural areas needed for the pipeline project. PSCo agreed to pay the
479
March 19, 2013
City 2 million dollars as mitigation for overall project impacts and as compensation for the value
of the natural area easements. PSCo did not place restrictions on the use of the $2 million.
The City has been conducting a paved trail study over the past several months and the information
from the study is being used to develop a Paved Trail Master Plan. Staff estimates the cost to build
out the paved trail system is $24 million for 30.7 miles of trail. It will take 50 years to complete the
trail system at current Conservation Trust funding levels ($470, 000 annually), reduced to 25 years
ifa trail capital expansion fee is created. Utilizing some or all of the PSCo funds for trails will help
to complete key sections of this highly valued community asset.
The NaturalAreas Department (NAD) has asignificant number ofland conservation and restoration
projects in process. Using some or all ofthe PSCofunds.for natural areas acquisition, conservation
or restoration will enable the NAD to pursue projects that would otherwise have to be delayed,
bypassed or reduced in scope. "
Councilmember Troxell expressed concern regarding Public Service Company of Colordo's (PSCo)
use of eminent domain and its effect on private property owners. He noted the City's Structure Plan
shows the intersection of Shields and Harmony as an activity center and this PSCo project
potentially devalues the property and its value to the community. He suggested the possibility of
postponing the item until further discussions can be held with PSCo.
Mayor Weitkunat noted this item would provide'$2 million in compensation to the City for this
project's impacts on the City's Natural Areas.
Trudy Haines, Land Conservation and Stewardship Board, requested assurance these funds will go
toward Natural Areas. She noted the Natural Areas staff has worked closely with PSCo on this
project and stated the pipeline crossing the Natural Areas will increase public safety. She supported
the Resolution.
Ed Reifsnyder, 4908 Chippendale Drive, supported the Resolution.
Rico Moore, 721 West Myrtle, suggested the City work toward a renewable energy future. He
opposed the pipeline project and suggested the funds could be used for buying the mineral rights at
Soapstone Natural Area.
Katherine Grimes, Land Conservation and Stewardship Board, supported the Resolution.
Ross Cunniff, 2267 Clydesdale, supported the Resolution and encouraged quick remediation.
Elizabeth Hudetz, 1407 Ticonderoga, opposed the pipeline but suggested asking for twice the
amount of money if the pipeline does occur.
Patrick Edwards, 1731 Valley Forge, supported the Resolution and suggested some of the funds
could be used for thinning of beetle kill trees.
Councilmember Troxell clarified he does not want the $2 million to be diverted away from the
Natural Areas and asked about other impacts this project will have on the Structure Plan and future
development for the area. City Manager Atteberry replied he has sent a letter to PSCo, encouraging
I:1
March 19, 2013
the routing of the pipeline through City right-of-way rather than private property. At this point,
there has been no response to that letter. He stated he would follow up with an additional contact
with PSCo.
Councilmember Troxell encouraged a meeting with Councilmembers, PSCol, and other affected
parties.
Mayor Weitkunat noted the big picture item deals with the interface the City has with other entities
as they encroach on City properties.
Councilmember Manvel made a motion, seconded by Councilmember Troxell, to adopt Resolution
2013-022.
Mayor Pro Tern Ohlson asked if a letter could be written to PSCo by the Mayor and Council.
Deputy City Attorney Daggett suggested Council make a motion directing the City Manager to draft
such a letter for the Mayor's signature.
Councilmember Horak asked if there is an eminent domain proceeding tomorrow. Deputy City
Attorney Daggett replied there is a hearing tomorrow related to immediate possession of the
easement.
Councilmember Horak asked if Councilmembers could speak at the hearing. Deputy City Attorney
Daggett replied she did not believe the City would be able to have input at the hearing. She noted
the City is named in the eminent domain case because the City owns easements that are on the
property that the pipeline will cross; however, PSCo is not disturbing the City's rights. She stated
the City has not yet looked at the viability of arguing against the use of eminent domain in this case.
Councilmember Horak suggested a City representative be present at the hearing. Deputy City
Attorney Daggett replied she would follow up on that possibility.
Mayor Pro Tern Ohlson thanked the Land Conservation and Stewardship Board for their work on
the item.
The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Horak and
Troxell. Nays: none.
THE MOTION CARRIED.
Ordinance No. 041, 2013,
Amending the Land Use Code to Address Certain Recommendations Contained
in the Student Housing Action Plan. Adopted on Second Reading
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
The Student Housing Action Plan (SHAP), adopted by City Council on February 26, 2013, has
identified both near -term and long-term action items to address concerns with compatibility between
481
March 19. 2013
multi family development and existing neighborhoods. This Ordinance, adopted on First Reading
by a vote of 5-1(Nays: Troxell), will (1) improve understanding of compatibility by modifying the
LUC to include good examples (photos, drawings) of what is allowed in certain zones; (2) amend
MMNdistrictdevelopment standards and LUC Sec. 3.8.30multi-family standards to specify that no
vehicular use area can be placed in the said setback from single- and two family dwellings. Also,
consider landscape requirements for this setback; and (3) better define and amend the LUC Sec.
3.8.16 (E) (2) requirement that 4+ bedroom developments need to provide additional open space,
recreation areas, parking areas and public facilities as are necessary to adequately serve the
development and retain the parking exemption in the TOD Overlay Zone. "
Councilmember Manvel made a motion, seconded by Mayor Pro Tern Ohlson, to adopt Ordinance
No. 041, 2013, on Second Reading.
Councilmember Troxell stated he would not support the motion based on the details of this item,
particularly related to the possibility of negative impacts on multi -family housing; however, he does
support the Plan in general.
Councilmember Kottwitz agreed with Councilmember Troxell.
Councilmember Manvel noted this item would adopt the Plan and commended work on the item.
Mayor Weitkunat stated this is a good first step toward perfecting student housing issues.
The vote on the motion was as follows: Yeas: Horak, Manvel, Ohlson and Weitkunat. Nays: Troxell
and Kottwitz.
THE MOTION CARRIED.
Resolution 2013-025
Adopting a Policy for Developing Primary Employer
Business Assistance Packages, Adopted
The following is the staff report for this item.
"EXECUTIVE SUMMARY
The City's historical approach to primary employer business assistance has served the community
well in the past. Several businesses have been retained and expanded as a result of business
assistance packages developed by the Economic Health Office and approved by City Council.
However, the time has come to move towards a more sophisticated approach to development and
oversight offuture business assistance packages. Therefore, this policy is intended to outline the
basics of a formal process for developing business assistance packages for primary employers that
maintains the flexibility of the historical approach but applies additional rigor and structure to the
process.
BACKGROUND /DISCUSSION
In the City of Fort Collins, the community intentionally refers to economic activity as "economic
health" rather than the traditional term "economic development. " The community has made this
H-A
March 19, 2013
purposeful distinction because it implies that the goal of City involvement is to ensure a balanced,
sustainable and resilient economy. The City's long-range vision, which is articulated in City Plan
Fort Collins, utilizes the basic tenets ofsustainability as its guiding principles for the City's vision
and acts as a foundation underpinning of all components of the plan. The three main tenets of
sustainability include systems thinking, continuous improvements and a triple bottom line (TBL)
analysis.
One of the primary purposes of the Economic Health Strategic Plan (EHSP) is the retention and
expansion ofprimary employers. The City of Fort Collins uses a variety of local assistance tools
to assist primary employers with relocation and expansion efforts. City Council and the EHSP have
identified the need to develop a clear business assistance policy. There is an increased demand by
taxpayers and public authorities to validate economic development assistance and to ensure the
investments made to support businesses has a clear, mutual benefit to the community and business.
This policy statement will apply to requests for direct assistance by primary employers considering
cost benefits of remaining and/or expanding their operations in the City, as well as, any primary
employer evaluating relocation to the City. For the purpose of this document, a "primary
employer" or `primary job" will be defined as any business or job located within the City that
derives a minimum of 50 percent of its income from the sale ofgoods or services outside the Fort
Collins Growth Management Area (GMA).
Work Session Recap
On January 22, 2013, staff presented an overview of the business assistance package's current
practices, an incentives benchmark study and the beginning development of a systems approach to
primary employer assistance. During this work session, councilmembers suggested staff work by
setting high-level criteria and sub categories that would allow projects to move up or down in terms
ofprojeci feasibility. Suggestions were also given to view the policy statementprocess in a holistic
approach instead of in isolation. In addition, Councilmembers recommended the need for a
thoughtful process that is not driven by time, but continuous process improvements. It is staff's
understanding that this involves a stepwise approach, marked with gradual progression and process
improvements. (Attachment 1)
Policy Intent
Currently, the City does not employ a one -size -fits -all approach to developing business assistance
packages. Instead, the City chooses to work collaboratively with the primary employer to build a
package that is specific to the particular business needs. While this historical approach has worked
for the City in the past, the time has come to move towards a more sophisticated approach to
development of future business assistance packages. Therefore, the business assistance policy
statement is intended to outline the basics of a formal process for developing primary employer
business assistance packages that will maintain the flexibility of the historical approach while
applying additional rigor and structure to the process. NOTE: the business assistance policy
statement described here is not to the exclusion of other business assistance efforts that might occur
(such as the Urban Renewal Authority's employment of tax increment financing).
The intent of the primary employer business assistance package policy is to:
March 19, 2013
"Encourage qualityprimaryjob retention and creation through private sector investment in our
community that supports a balanced, sustainable and resilient economy. "
Policy Framework
As defined in the Primary Employer Business Assistance Package policy statement (Exhibit A to
Resolution 2013-025), the framework outlines the refined process for developing business assistance
packages in several areas:
1. Applicability — Does the request meet the "primary employer" criteria?
2. Organization and management —Is there clear, defined roles and responsibilities assigned?
3. Available assistance tools — What tools will be available for this business assistance
package?
4. Application requirements —Has the company provided the information required to analyze
the project?
5. Evaluation criteria —Does the project align with City Plan, the Economic Health Strategic
Plan and other City goals?
6. Business assistance inputs — Does the project meet the annual average wages, number of
retained or net new jobs and health care premium assistance?
7. Economic and other analyses — Does the project pass the economic and TBL anal vsis?
8. Minimum company commitment —Has the company agreed to the minimum commitments
required to move the project forward?
9. Compliance monitoring —Has the company and city stafr agreed on the compliance
measures?
10. Annual reporting — Based on the compliance monitoring, city staff will provide annual
compliance updates to City Council.
Policy Framework Work Plan
In an effort for continuous improvement through monitoring and future plan updates, staff is
committed to bringing forward additional process improvements over the next few months. Each
item will be developed, approved and reviewed from time to time with the City Manager, with notice
to City Council when substantial changes are proposed. Below is a list ofsuggested improvements
and a work plan for accomplishing these continuous improvements:
Item
Description
A n t i c i p a t e d
Completion Date
Application
The EHO will use existing applications, similar to the
April 2013 (initial)
Community Development Block Grantfunding request
and the Urban Renewal Authority applications as a
Ongoing evaluation
model for the initial application.
and improvements
Evaluation Criteria
Determine the screening criteria for all requests
May 2013 (initial)
using a set of evaluation criteria designed to provide
a holistic evaluation of the proposed project.
Ongoing evaluation
and im rovements
Input Criteria
Development of input criteria that aligns with City
May 2013 (initial)
objectives from the EHSP, City Plan, and/or other
relevant strategies such as target industry clusters).
Ongoiinz evaluation
ME
March 19, 2013
Item
Description
Antic i p ate d
Completion Date
and improvements
C o m p l i a n c e
All business assistance packages require a
June 2013 (initial)
Monitoring
performance -based compliance before payment is
distributed. Staffwill work collaboratively with other
Ohgoingevaluation
city departments and businesses to provide anhital
and improvements
report to council.
Economic Impact
Use of a triple bottom line (TBL) approach to
Ongoing evaluation
A n a l y s i s
evaluate each project.
and improvements
Improvements
Determination of the sound approach that evaluates
revenues and costs (including, not only economic, but
environmental and social costs).
New Tools
Staff is committed to ongoing evaluation of additional
On -going
tools for their applicability to primary employers and
job retention and creation.
FINANCIAL/ECONOMIC IMPACTS
The business assistance package policy statement provides enhanced analysis of future primary
employer business assistance proposals. No direct financial impact is incurred with the business
assistance package policy statement.
ENVIRONMENTAL IMPACTS
Although the actual primary employer business assistance package policy statement does not have
any environmental impact, staff is committed to work with the community, businesses and other
identified groups to evaluate primary employer business impacts.
BOARD / COMMISSION RECOMMENDATION
Staffpresented before the Economic Advisory Commission (EAC) on two occasions, December 19,
2012 and February 20, 2013. Staffrequested feedbackfrom EA members on classification/ranking
criteria. (Attachment 2, 3 and 4)
PUBLIC OUTREACH
Staffpresented the businessassistance package policy statement several times within the community.
As mentioned above, staffpresented before EA in December 2012 and February 2013. Staff also
presented the business assistance package policy framework to the Fort Collins Area Chamber of
Commerce's Local Legislative Affairs Committee on January 18, 2013 and March 8, 2013.
Additionally, staff hosted an open house to the community on January 16, 2013, with the option of
an online survey which was open from January 14, 2013 — February 8, 2013. "
Josh Birks, Economic Health Director, stated this policy provides a systems approach, based on the
triple bottom -line and is related to the City's embracing of economic health rather than economic
development. This particular policy focuses specifically on the retention, expansion, and, in some
Im
March 19, 2013
cases, attraction of primary jobs. A primary job is defined as any business orjob located within the
City that derives a minimum of 50% of its income from the sales of goods and services outside of
the Growth Management Area. Birks reviewed the process for developing business assistance
packages as well as the policy framework work plan.
Ross Cunniff, 2267 Clydesdale, expressed concern about the focus on primary employers that derive
most of their income from outside the Growth Management Area.
Eric Sutherland, 3520 Golden Currant, stated this policy is too complicated.
Kevin Jones, Fort Collins Area Chamber of Commerce, supported the Resolution.
Patrick Edwards, 1731 Valley Forge, disagreed with the need for these types of incentive packages.
Maya Hesser, 2133 Ford Lane, stated taxes always hurt the citizens.
Walt Elish, Northern Colorado Economic Development Corporation, stated businesses want
consistency and commended staff for work on the item. He supported the Resolution.
Councilmember Troxell stated this policy should encourage and foster the dynamic aspect of Fort
Collins' role in the region and state as a primary employer. He requested staff input as to how this
encourages more than a direct bilateral relationship with a particular employer. Birks replied the
Strategic Plan guided the broader economic health strategies. This specific tool relates to direct
assistance with specific companies and makes the process more transparent for all parties involved.
Councilmember Manvel asked about the use of metro districts. Birks replied metro districts relate
more to redevelopment projects or development projects, which is not necessarily the focus of this
policy. However, they can be used to further primary employer opportunities.
Mayor Pro Tem Ohlson asked when environmental impacts of companies will come into play. Birks
replied the application will require information related to natural resource stewardship and those
questions will be tied to the evaluation criteria. The policy will require that any project that comes
forward has been evaluated against these criteria; staff will present specific criteria for Council
consideration in May.
Mayor Pro Tern Ohlson asked about consequences for businesses not meeting promises. Birks
replied all agreements are tied to certain targets of employment and other performance requirements
and benefits received from the City may be prorated. Bruce Hendee, Chief Sustainability Officer,
replied there is a verification section in the systems side of this policy.
Mayor Pro Tern Ohlson noted the City always fulfills its portion of these deals and asked about
consequences for non-compliance on the business end. Hendee replied the accountability side is
being developed.
Mayor Pro Tern Ohlson asked about the policy's plan for getting information out to the public.
Birks replied the policy sets a plan for trying to create a window in which there is no longer
confidentiality around projects so an opportunity to discuss the projects in an open way occurs
earlier.
UZI
March 19. 2013
Councilmember Manvel asked about the applicability of this policy to the Woodward assistance
package to be on First Reading next week. Hendee replied the Woodward project is a "once in thirty
year project" and the assistance package does have some specifics that do not exactly match this
policy.
City Manager Atteberry agreed with Councilmember Manvel's point but suggested the policy could
have the possibility of exceptions in unique cases, at Council discretion, perhaps related to scale,
magnitude, and investment amount.
Councilmember Troxell noted this is a Resolution and the policy is not binding Council to a
decision. He commended the framework as a step toward additional transparency.
Councilmember Kottwitz made a motion, seconded by Councilmember Troxell, to adopt Resolution
2013-025.
Councilmember Horak suggested a language change for Exhibit A to add the phrase "to the extent
practicable" or other language which would eliminate a perceived direct violation of the policy with
respect to the.Woodward assistance package.
Councilmember Kottwitz accepted the amendment.
Councilmember Kottwitz encouraged tracking primary employers in the Northern Colorado area
who have selected municipalities other than Fort Collins in which to locate, or have moved out of
Fort Collins. Birks replied staff is committed to better positioning the City in terms of retaining and
expanding current and perspective employers.
Mayor Pro Tern Ohlson stated he would not support the Resolution, though he did commend the
changes to the application. He suggested additional consequences for non-compliance.
Mayor Weitkunat supported the Resolution as a great beginning policy.
The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Horak and Troxell.
Nays: Ohlson.
THE MOTION CARRIED.
(Secretary's note: The Council took a brief recess at this point in the meeting.)
Items Relating to an Operator Agreement between
the City and Prospect Energy, LLC. Adopted on First Reading
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
A. Resolution 2013-024Approving an Oil and Gas Operator Agreement Between the City and
Prospect Energy, LLC.
ME
March 19, 2013
B. First Reading of Ordinance No. 057, 2013, Terminating the Moratorium Imposed by
Ordinance No. 145, 2012 with Respect to Oil and Gas Operations Conducted under an Oil
and Gas Operator Agreement Between the City and Prospect Energy, LLC.
EXECUTIVE SUMMARY
Council is considering the approval an Operator's Agreement with Prospect Energy that would
permit Prospect Energy to conduct oil and gas operations in the city limits. The terms of the
Agreement ensure stringent public health and safety measures are in place through Best
Management Practices (BMPs),which generally exceed current requirements mandated by the
Colorado Oil and Gas Conservation Commission (COGCC), and provide strict controls on the
release of methane gases and other volatile organic compounds (VOCs). If the Agreement is
approved, Council will consider adopting Ordinance No. 057, 2013 removing the Moratorium
imposed by Ordinance No. 145, 2012 with respect to an Oil and Gas Operator Agreement with
Prospect Energy.
BACKGROUND /DISCUSSION
Oil and gas production is currently limited to the Fort Collins Field (Attachment #2), located in the
northeast portion of the city. The Fort Collins Field is regulated by the COGCC and has been in
production since about 1925. In the city limits, the field consists of seven oil producing wells and
seven injecting wells, all ofwhich'are managed by one operator, Prospect Energy. Prospect Energy
is unable to drill new wells since Ordinance No. 145 (Moratorium) was approved December, 2012.
In addition, the company is no longer able to utilize hydraulic fracturing since the adoption of
Ordinance No. 032. Prospect Energy also holds certain leasehold interests within the City
described as the Undeveloped Area (UDA), as depicted in Attachment #2. Council allowed for
exemptions from Ordinance No. 032 provided a Council approved operator agreement was in place
that includes strict controls on methane release and adequatelyprotects the public health, safetyand
welfare of the city. The recommended agreement with Prospect Energy contains such provisions.
A summary of those provisions follows with more detailed information contained in Exhibit A to
Resolution 2013-024.
Summary of Controls for Methane Gas
Prospect Energy captures all gases from production and tanks and routes them to a thermal oxidizer
for destruction. This method currently results in over 99% of all emissions being destroyed. The
COGCC rule requires 95% of emissions be destroyed. This proposed Agreement requires at least
98% destruction and use of a thermo-oxidizer for emission destruction to be utilized for any new
wells in the Fort Collins Field. In the UDA, Prospect Energy will capture and destroy emissions
at the well (Exhibit A -Section 21 (b)) or send through a thermal oxidizer. Prospect Energy also
agrees to comply with:
• Environmental Protection Agency (EPA) Method 21 (Section 21— Exhibit A)
• No uncontrolled venting of methane (Section 21 — Exhibit A)
• Minimal flaring during drilling and completions (Section 21—Exhibit A)
• Develop and maintain a Leak Detection and Repair (LDAR) (Section 21 — Exhibit A)
o Use a Forward -Looking Infrared (FLIR) camera
o Notify the City for observation of testing
an.]
March 19. 2013
• Green Completions (Section 22- Exhibit A)
• Containment of all produced water or flowback fluids and no permanent storage of waste
products (Section 45 — Exhibit A)
Summary of Best Management Practices
(Public Health and Safety Measures — details in Exhibit A)
Setbacks — Any new wells drilled will conform to the current COGCC rules which will be five
hundred (500) feet from any building and one thousand (1,000) feet from any institutional facility
beginning August 1, 2013. However, in the Fort Collins Field, new wells must be constructed on
existing well pads because ofan existing Surface Use Agreement (SUA), which conform to previous
COGCC setbacks. Those well pads are located near or within Water's Edge, Richard's Lake and
Hearthfire subdivisions.
Conceptual Review —No less than thirty (30) days prior to the submission of an Application for a
Permit to Drill (APD) (note: APD is the COGCCpermittingprocess), Prospect Energy will schedule
a meeting with the City to review the proposed new well or drilling activity. The goal ofthis meeting
would be for staff and the applicant to review the proposed oil and gas operation in a manner that
ensures compliance with the operator agreement and applicable state and federal regulations. This
pre -submittal meeting will also allow the applicant and staff to explore site -specific concerns, to
discuss project impacts and potential mitigation methods including field design and infrastructure
construction to minimize impacts, to discuss coordination of field design with other existing or
potential development and operators, to identify sampling and monitoring plans for air and water
quality, and other elements of the operator agreement as contained in Exhibit A.
Community Notice —Prospect Energy must provide community and staff notice. Prior to an APD,
the Agreement specifies mailed notice, posted notice, neighborhood meetings and also a notification
to the public prior to the commencement of drilling. Consistent with Option "B" of the proposed
Land Use Code regulations, notice is required for any oil and gas operation to surface owners
within two thousand six hundred forty (2, 640) feet of the parcel and to persons registered in writing
with the Planning Director.
Closed Loop Pitless Systems — are required for the Containment and/or Recycling of Drilling and
Completion Fluids. Wells shall be drilled, completed and operated using closed loop, pitless systems
for containment and/or recycling of all drilling, completion, flowback and produced fluids.
Chemical disclosure and storage -the City will be provided, in table format, the name, Chemical
Abstract Services (CAS) number, volume, storage, containment and disposal method for all
drilling and completion chemicals (solids, fluids, and gases) used on the well pad. Fracture
chemicals will be uploaded onto the Frac Focus website. The City will also post such information
on the City website. The Company will not permanently store hydraulic fracturing chemicals,
flowback from hydraulic fracturing, or produced water in the current City limits.
Electric equipment— Prospect Energy will be required to utilize electric-poweredengines
for motors, compressors, and drilling equipment and for pumping systems when feasible in order
to mitigate noise and reduce emissions.
March 19, 2013
Emergency preparedness plan — Prospect Energy is required to develop an emergency
preparedness plan for each specific facility site, which shall be in compliance with the International
Fire Code. Among other provisions, the plan shall be filed with the Poudre Fire Authority and the
City of Fort Collins Office of Emergency Management and updated on an annual basis or as
conditions change (responsiblefield personnel change, ownership changes, etc.). The plan includes
a provision establishing a process by which the operator engages with the surrounding neighbors
to educate them on the risks of the on -site operations and to establish a process for surrounding
neighbors to communicate with Prospect Energy.
Air Quality — Prospect Energy must comply with emissions regulations as required by State and
Federal laws. In addition, there will be no uncontrolled venting of methane. All gas vapors will be
captured to the extent practicable. Vapor capture equipment will operate at 98% efficiency or
better. There are no gas sales lines in the Fort Collins field because the quantity and quality ofgas
is low and not marketable. If salable gas were to occur in the UDA, a sales line would be
constructed. The Operator will develop and maintain a leak detection and component repair
(LDAR) program according to EPA Method 21 for equipment used in permanent operations. LDAR
will be performed on newly installed equipment, and then on an annual basis. A forward -looking
infrared (FLIR) camera will be used as the preferred implementation method of EPA Method 21 as
available from the state; if unavailable, other methods will be used in compliance with this method.
Upon request from the City, Prospect Energy will implement EPA Method 21 should additional
concerns arise. At least once per year, Prospect Energy will notify the Cityprior to FLIR camera
use in case the City wishes to observe the method.
Prospect Energy and the City will split the costs of baseline sampling and analytical work
performed by a third party consultant agreeable to both parties over a five (5) day sampling period.
Prospect Energy will conduct air sampling during well completion. Periodic air monitoring will
be performed for hydrogen sulftde (112S), a hazardous air pollutant (HAP). Prospect Energy will
perform field monitoring using the Jerome 631 XC or equivalent instrument annually, or until such
time that odors are not detected past the Fort Collins Tank Batteryfence line in City Limits. The
City may require additional air monitoring as needed to respond to emergency events such as spill,
process upsets, or accidental releases or in response to odor complaints in City Limits.
During well completion, the capture and beneficial use of natural gas is preferred over flaring.
However since the Fort Collins field has so little natural gas it is not reasonable to capture the gas
and as such minimal flaring will occur. What flaring does occur will be monitored twenty-four (24)
hours per day. Duringproduction theflare shall befired with natural gas and shall be operated with
a ninety eight (98) percent or higher VOC destruction efficiency. An automatic pilot system shall
be used when feasible. Other ignition systems will include the installation and operation of a
telemetry alarm system or an on -site visible indicator showing proper function.
Water Quality Monitoring Plan — Prospect Energy shall comply with COGCC Rule 609. In
summary, this requires pre- and post -drilling testing. The rules require oil and gas operators to
sample all "Available Water Sources" (owner has given consent for sampling and testing and has
consented to having the sample data obtained made available to the public), with a cap of four (4)
water sources, within one-half (112) mile radius of a proposed well, multi -well site, or dedicated
injection well. Water sources include registered water wells, permitted or adjudicated springs, and
certain monitoring wells. Prospect Energy agrees to the following requirements above and beyond
the COGCC requirements: analyzing for dissolved metals as indicated in the Land Use Code;
1
March 19, 2013
sampling intervals to be baseline (before drilling), post -drilling at one, three, and six years.
Analytical results will be shared with the COGCC, the City, and the landowner. A11 spills, for new
and existing wells, shall be managed in accordance with COGCC regulations.
Soil Gas Monitorine — The City, at its discretion, may conduct soil gas monitoring to assess well
casing integrity. This would be typically completed within 90 days ofnew well completion. The City
shall notify the Operator prior to entering the site for soil gas monitoring.
Spills - The Company shall comply with COGCC Rule 609 "Spills and Releases ", and notify the
City and whenever there is notification to the COGCC. The Company shall also copy the City on
any written correspondence to the COGCC or other regulatory authority.
Transportation and circulation - Prospect Energy shall include in their applications detailed
descriptions of all proposed access routes for equipment, water, sand, waste fluids, waste solids,
mixed waste, and all other material to be hauled on the public streets and roads of the City. The
submittal shall also include the estimated weights of vehicles when loaded, a description of the
vehicles, including the number of wheels and axles of such vehicles, trips per day and any other
information required by the Traffic Engineer. Preliminary information is required for this item for
the Conceptual Review meeting, in accordance with Exhibit A. The Company shall comply with all
Transportation and Circulation requirements as contained in the Land Use Code as may be
reasonably required by the City's Traffic Engineer.
Wastewater and Waste Management - There will be minimal waste water in the Fort Collins Field,
as there will be no tank batteries (produced water and oil storage) in the City,for the Fort Collins
field. As described in "Closed Loop System " and "Green Completions, " there is no discharge of
fluids and fluids are contained. Storage, transportation, and treatment of wastes during well
drilling and completion are handled by third party contractors, under the direction ofthe Operator.
Waste is stored in tanks, transported by tanker truck, and disposed of at licensed disposal facilities.
In the UDA, new secondary containment shall be constructed ofsteel, with sufficient perimeter and
height to hold one and one-half (1.5) times the volume of the largest tank and sufficient freeboard
to prevent overflow. No potential ignition sources shall be installed inside the secondary
containment area unless the containment enclosed a fired vessel. The requirements for secondary
containment will meet the Fort Collins Stormwater Criteria Manual. No land treatment of oil
impacted or contaminated drill cuttings are permitted. The use of a closed loop drilling system
precludes discharge ofproduced water orflowback to the ground or the use ofpits. Produced water
orflowback will not be used for dust suppression. A copy of the field's Spill Prevention, Control,
and Countermeasure Plan (SPCC) will be given to the City, which describes spill prevention and
mitigation practices. The Company will provide the City documentation of waste disposal and its
final disposition.
Water supply — Prospect Energy will identify in the site plan its source for water used in both the
drilling and production phases of operations. The sources and amount of water used in the City
shall be documented and this record shall be provided to the City annually or sooner, upon request
of the City Manager. The disposal of water used on site shall also be detailed including anticipated
haul routes, approximate number of vehicles needed to supply and dispose of water, and the final
destination for water used in operation.
491
March 19, 2013
Comparison with LUC Option "B"
During Council deliberations, direction was given to staff to proceed with negotiations for an
Agreement with Prospect Energy that was consistent with the Land Use Code provisions reviewed
by Council in Ordinance No. 144. While Ordinance No. 144 was not adopted it contained
regulation for oil and gas exploration and production. One of the options was for a single-track
development review process that generally contained more stringent regulations than currently
required by the COGCC and was described as Option `B ". Staffprepared a matrix illustrating how
the proposed agreement with Prospect Energy meets or exceeds requirements in Option B
(Attachment 3).
Other Conditions of the Agreement
Through this Agreement, Prospect Energy will comply with all BMPs for New Wells as defined as
a "Company -operated well spudded during the term of this agreement, and located on either a
currently existing well pad or a new well pad that is located within the City limits. " In other words,
BMPs will not apply to previously developed wells either inside or outside the city limits owned by
Prospect Energy. Approving this agreement requires Prospect Energy to comply with the terms of
the Agreement and removes any further development review permitting process. However, the
Agreement provides for public and staff notice, staff review and periodic inspections of any New
Wells, Prospect Energy will also be required to use the most stringent regulation in effect whether
the regulation is a State, Federal or required by this Agreement.
The term proposed in the Agreement is for five (5) years with successive five (5) year terms, until
either Party wishes to terminate the Agreement. The Agreement is binding to anyone who acquires
either the Fort Collins Field or the Undeveloped Acreage (UDA). There is also a non-performance
clause in the Agreement which allowsfor mediation and court remedies in the event theperformance
is not "cured. "
If Council approves this agreement, Prospect Energy has indicated they would continue operating
the Fort Collins Field and potentially increase the number of wells by six (6) to eight (8). As
required by a SUA all new wells will be drilled from existing well pads thus minimizing any future
surface impact, from the new drilling. It is likely that hydraulic fracturing would be utilized in the
operation of the field. This fracturing would not be in conjunction with horizontal drilling and does
not require intensive water usage seen in other natural gas developments. For example, the last six
(6) hydraulicfracturingprocesses in the Muddy JFormation -Fort Collins Field averaged 114,129
gallons of water compared to 380,272 for a Wattenberg Vertical well or a Wattenberg Horizontal
well requiring 2,992, 374 gallons (data provided by COGCC). In addition, it is likely that the Fort
Collins Field will not produce any marketable gas due to the extremely low quantity of gas
contained in the Feld.
Prospect Energy also holds certain leasehold interests within the City described as the Undeveloped
Area (UDA) as depicted in (Attachment #2). If Council approves this agreement Prospect Energy
intends to explore oil and gas development in the UDA. It should be noted that Prospect Energy has
Surface Use Agreements with the surface owners for the Fort Collins Field (since 1988, amended
2001) and the UDA (2011). Those agreements govern any potential well locations and associated
facilities within the Subdivisions and specifiedother terms, including, but not limited to, landscaping
and fencing around wells and associated production equipment.
492
March 19, 2013
FINANCIAL /ECONOMIC IMPACTS
A true triple bottom line analysis includes an assessment of environmental, social, and economic
impacts. Staff analysis to date has focused on potential and possible environmental impacts if
hydraulic fracturing is allowed. Staffwas unable to conclusively determine financial impacts ofany
health and safety hazard related to hydraulic fracturing due to the significant number of variables
that relate to the hydraulic fracturing process, transportation of material and waste produced, and
removal ofwaste materials. A social impact analysis has not yet been undertaken for this discussion.
It is assumed that social impacts of hydraulic fracturing are discussed and addressed in terms of
concerns about health impacts, impacts to property and housing values, and quality of life.
Prospect Energy indicates that without this Agreement they would no longer be able to adequately
operate the Fort Collins Field or expand into other existing lease holdings currently within the city
limits.
ENVIRONMENTAL IMPACTS
Documented in Agenda Item Summary (AIS) 26, prepared for Council Hearing February 19, 2013. "
Laurie Kadrich, Community Development and Neighborhood Services Director, stated this
agreement, if approved, would allow Prospect Energy to continue operating, or expand operations
within the city limits in the Fort Collins field, as well as explore production opportunities on other
leases that they own within the city limits, and use hydraulic fracturing in the process under certain
conditions. Kadrich noted Prospect Energy has agreed to abide by all conditions of this agreement
in the event the City is able to work with Larimer County to regulate oil and gas development within
the growth management area. Kadrich reviewed the existing Fort Collins field location and
discussed the possibility of expansion. She also discussed environmental and health impacts of the
field and detailed the requirements of the agreement.
Deputy City Attorney Daggett read the revisions to the Ordinance.
Jeremiah Thomas, Fort Collins resident, stated the operator should not be allowed in city limits, but
encouraged proper oversight if they are allowed to operate.
Becky Vass, Laporte resident, Frack Free Fort Collins, opposed the use of hydraulic fracturing,
citing the City's recent ban, and opposed the operator agreement.
Maya Hesser, 2133 Ford Lane, credited Prospect Energy with fixing some issues related to the
previous operator. She expressed concern relating to air quality and asked the City to ensure
Prospect Energy becomes the safest operator in the state.
Lia Pace, Fort Collins resident, opposed the use of hydraulic fracturing, citing the City's recent ban,
and opposed the operator agreement.
Danny Hesser, 2133 Ford Lane, opposed hydraulic fracturing and asked Council to maintain the
moratorium for the growth management area. He asked that negotiations be conducted in a manner
to demand accountability.
493
March 19, 2013
Devin Hirning, 2214 Fossil Creek Parkway, commended Scott Hall and Prospect Energy for making
improvements over the previous operator but encouraged proper vetting of the agreement.
Elizabeth Hudetz, 1407 Ticonderoga, expressed concern regarding air quality issues and opposed
hydraulic fracturing.
Mary Griggs, Prospect Energy Environmental Engineer, stated a disclosure of all the chemicals used
is required by law and stated Prospect Energy aims to be a good steward of the environment.
Ross Cunniff, 2267 Clydesdale, expressed concern about the state's setback regulations and
encouraged additional work on some of the issues prior to the acceptance of an operator agreement.
Patrick Edwards, 1731 Valley Forge, encouraged everyone to read the agreement and commended
Prospect Energy for being a good neighbor. He supported the agreement.
Scott Hall, Prospect Energy Chief Executive Officer, requested approval of the operator agreement
and noted many of the environmental concerns have been addressed in the agreement.
Rico Moore, 721 West Myrtle, discussed the hazards of hydraulic fracturing.
Councilmember Manvel asked if this agreement would restrict drilling to existing pads. Kadrich
replied in the affirmative for the Fort Collins field. In the undeveloped acreage area (UDA), there
are no existing wells; therefore, new development could occur in that area.
Councilmember Manvel asked what would happen to the agreement if a new operator purchases the
field. Deputy City Attorney Eckman replied the agreement would go with the field and is
assignable.
Councilmember Manvel asked about emergency notification provisions. Kadrich replied, if this
agreement is approved, Prospect Energy will be required to notify the City, as well as the local
emergency agency, of any kind of spill or problem, as well as their general reporting requirements.
Mike Gavin, Emergency Management Office Manager, PFA, replied the intent was to have them
report any spills and have emergency operations plans on site. Citizens would be notified using the
various media emergency notification systems. Kadrich noted there is a specific requirement in the
agreement requiring the operator to communicate with neighboring residents regarding potential
hazards and emergencies.
Mayor Pro Tern Ohlson asked why this item has moved forward so quickly and asked why tracking
is being considered. He questioned the apparent lack of public outreach regarding the item. Mayor
Weitkunat replied the tracking ban exempted the local operator. Councilmember Horak replied the
ban allowed the option of an operator agreement which would allow operations to continue on
existing well pads.
Mayor Pro Tem Ohlson asked why fracking was going to be allowed in the UDA. He stated his
understanding is that the memorandum of understanding (MOU) does not apply to the existing
operation. Kadrich replied in the affirmative and stated the MOU would apply to any new
development within the existing field, which is limited to the existing pads in the Fort Collins field.
She clarified this would mean allowing additional tracking other than on the existing sites.
March 19, 2013
Councilmember Manvel asked if the undeveloped acreage was mentioned previously. Kadrich
replied the specifics had not previously been addressed, other than the direction to work as quickly
as possible to develop an operator agreement with the existing operator.
Mayor Pro Tern Ohlson stated he would have thought the MOU would have impacted the existing
operations to the most reasonable extent possible.
Councilmember Manvel noted the best management practices, as outlined, do not apply to existing
wells and asked if they would apply to existing wells if those wells are re-fracked. Kadrich replied
in the affirmative, but stated this agreement would not apply to hydraulic fracturing on one of the
existing seven wells. Deputy City Attorney Eckman stated the best management practices apply to
new wells on old pads or not; routine maintenance and hydraulic fracturing would be allowed on
existing wells without the application of best management practices.
Scott Hall, Prospect Energy, noted existing wells were excluded from best management practices
with the exception of two items.
Councilmember Horak asked about future plans for the UDA. Mr. Hall replied that is exploratory
acreage and there are no immediate plans to drill there as it is deemed risky. Should an exploratory
well be successful, Mr. Hall anticipated drilling multiple wells from one pad in order to reduce the
amount of surface disturbance. b
Mayor Pro Tern Ohlson asked about the possibility of developing the UDA. Lindsay Ex,
Environmental Planner, replied there are two key areas of wet meadow in the UDA; however, there
should be no issue in protecting those areas. The operator agreement contains Land Use Code
ecological protection standards similar to those for any other development in the city.
Mayor Pro Tent Ohlson asked about environmental restoration requirements. Ex replied the state
regulates the restoration requirements; however, the City would have an ongoing relationship with
the operator per the operator agreement.
Mayor Pro Tern Ohlson expressed concern that the state's regulations would not be strict enough.
Ex replied that is an area in which staff feels comfortable using the Local Government Designee
process to make comments and get the City's needs met.
Mayor Pro Tern Ohlson asked when staff knew about the UDA. Kadrich replied she became aware
of it four or five weeks ago when Prospect Energy sent the first draft of the agreement.
Deputy City Attorney Eckman noted an ecological characterization study would be required if any
new well is within 500 feet of any natural habitat or feature and, if impacts to these resources occur,
mitigation plans to ensure no net resource loss, per the Land Use Code, will occur.
CouncilmemberTroxell made a motion, seconded by Councilmember Kottwitz, to adopt Resolution
2013-024.
Mayor Pro Tem Ohlson stated he would not support the motion as he was unaware of the UDA and
stated the fracking ban should apply to that area. He opposed what he viewed as the reversal of the
fracking ban.
495
March 19, 2013
Councilmember Troxell stated he would support the motion as this will allow the current operator
to fulfill its mineral rights and allow the City to avoid potential litigation. He commended the open
communication of Prospect Energy and commended the staff presentation and facts therein.
Councilmember Horak stated he would support the Resolution and commended work on the
agreement and the spirit of cooperation of Prospect Energy. He did express concern regarding the
potential of developing the UDA.
Councilmember Manvel stated he would not support the motion as there should have been additional
process related to the UDA.
Councilmember Kottwitz disagreed regarding process concerns. She commended Prospect Energy
for its commitment to the community and commended staff work on the expedient agreement.
Mayor Weitkunat stated she would support the Resolution as the existing operator has always been
a part of the discussion.
The vote on the motion was as follows: Yeas: Weitkunat, Kottwitz, Horak and Troxell. Nays:
Manvel and Ohlson.
THE MOTION CARRIED.
Councilmember Troxell made a motion, seconded by Councilmember Kottwitz, to adopt Ordinance
No. 057, 2013, as updated, on First Reading.
Mayor Weitkunat requested an explanation of the moratorium termination with respect to Prospect
Energy. Kadrich replied the operator agreement will be effective today, as it was done by
Resolution; however, the moratorium on new drilling would still be in place until July 31. This
Ordinance would remove that moratorium for Prospect Energy in order to allow it to continue
existing operations and any expansion.
Councilmember Horak noted the type of hydraulic fracturing done by Prospect Energy is different
than what most people think of as tracking. He requested additional assurances regarding potential
development in the UDA as well as additional information regarding the implications of this
termination.
Councilmember Manvel stated he would support the motion as it is logical due to the majority of
Council supporting the agreement.
Councilmember Horak requested information regarding response and restoration following an
emergency situation. Ex replied the emergency preparedness plan requires the operator to have
adequate personnel, supplies, and training to implement the plan immediately and at all times during
operations.
Mayor Pro Tent Ohlson expressed concern regarding the ability to track on a piece of land unknown
until recently. '
.E
March 19, 2013
The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Horak and Troxell.
Nays: Ohlson.
THE MOTION CARRIED.
Extension of the Meeting
Councilmember Manvel made a motion, seconded by Councilmember Troxell, to extend the meeting
past 10:30 p.m. Yeas: Weitkunat, Manvel, Ohlson and Troxell. Nays: Horak and Kottwitz.
THE MOTION CARRIED.
Consideration of the Appeal of the February 7, 2013 Planning and Zoning Board Decision
to Approve Sign Modifications for the Foothills Mall Redevelopment Plan, Amended the
Planning and Zoning Board's Approval of Modification Regarding Signs
The following is the staff memorandum for this item.
"EXECUTIVE SUMMARY
The Planning and Zoning Board conducted a special meeting on February 7, 2013. A development
application for the Foothills Mall Redevelopment Plan was one of the items for consideration on
the agenda. The Plan is.for a 76.3 acre mixed -use redevelopment of the existing Foothills Mall,
consisting of a commercial component, a commercial parking structure, and 800 multi family
dwelling units. The development application also included a modification ofstandards request for
sign regulations contained in Section 3.8.7 of the Land Use Code (LUC). The sign modifications
that are the subject of this appeal were approved by the Board.
On February 21, 2013, Mayor Pro Tem Kelly Ohlson filed a Notice ofAppeal with the City Clerk.
The Notice did not contain any specificgroundsfor the appeal but did include a general description
of the issues to be considered on appeal. The issues center on the Planning and Zoning Board's
approval of modification requests to:
Allow two electronic message center signs (a.k.a. digital signs) to display messages in full
color rather than in one color,
2. Allow two electronic message center signs to exceed 50% of the total area of the sign face;
and
3. Allow two electronic message center signs along the South College Avenue frontage of the
development instead of the one electronic message center sign allowed.
BACKGROUND /DISCUSSION
Section 3.8.7 of the LUC contains regulations that govern the size, height, location, and design
requirements for signs on private property. The Applicant, Alberta Development Partners,
submitted a modification request pertaining to two electronic message center ground signs to be
located along the South College Avenue perimeter of the site. Specifically, the modifications which
are the subject of this appeal were for relief from the following standards:
497
March 19, 2013
Section 3.8.7(M)(4)(c)—allow the two proposed electronic message center ground signs
along South College Avenue to display messages in full color rather than one color.
Section 3.8.7(M)(4)(d)—allow thesize ofthe two electronic message center ground signs
along South College Avenue to exceed fifty percent (50%) of the total area of the sign
face. Specifically, allow the size of each of the two signs to be sixtyfour percent (64%)
of the total area of the sign face-
3. Section 3.8.7(M)(4)(h) — allow more than one electronic message center ground sign per
street per development. Specifically, allow two such signs along the South College
Avenue frontage ofthe development, with the signs separated by a distance of 1,164 feet.
Action of the Planning and Zoning Board
After testimony from the staff, the applicant, and the public, the Planning and Zoning Board
unanimously approved the modification requests to items 2 and 3 above, and approved the
modification request to item l above by a vote of 5-2.
Allegations on Appeal
On February 21, 2013, Mayor Pro Tem Kelly Ohlson (the Appellant) filed a Notice ofAppeal with
the City Clerk. The only actions of the Planning and Zoning Board which are the subject of the
Notice are in regard to the approval of the modifications to items 1, 2, and 3 above.
The Notice does not allege any specific allegations of error regarding whether the Board properly
interpreted the Land Use Code or whether the Board conducted a fair hearing.
Review Criteria for Modification Requests
Section 2.8 of the LUC authorizes the Planning and Zoning Board to grant modifications to the
standards contained in the LUC if it finds that the granting of the modification complies with the
requirements of Section 2.8.2(H), which reads as follows:
(H) Step 8 (Standards): Applicable, and the decision maker may grant a modification of
standards only if it finds that the granting of the modification would not be detrimental to
the public good, and that:
(1) the plan as submitted will promote the general purpose ofthe standard for which
the modification is requested equally well or better than would a plan which
complies with the standard for which a modification is requested; or
(2) the granting ofa modification from the strict application ofany standard would,
without impairing the intent and purpose of this Land Use Code, substantially
alleviate an existing, defined and described problem of city-wide concern or would
result in a substantial benefit to the city by reason of the fact that the proposed
project would substantially address an important community need specifically and
expressly defined and described in the city's Comprehensive Plan or in an adopted
policy, ordinance or resolution ofthe City Council, and the strict application ofsuch
a standard would render the project practically infeasible; or
March 19. 2013
(3)by reason of exceptional physical conditions or other extraordinary and
exceptional situations, unique to such property, including, but not limited to,
physical conditions such as exceptional narrowness, shallowness or topography, or
physical conditions which hinder the owner's ability to install a solar energy system,
the strict application of the standard sought to be modified would result in unusual
and exceptional practical difficulties, or exceptional or undue hardship upon the
owner of such property, provided that such difficulties or hardship are not caused
by the act or omission of the applicant; or
(4)the plan as submitted will not diverge from the standards of the Land Use Code
that are authorized by this Division to be modified except in a nominal,
inconsequential way when considered from theperspective ofthe entire development
plan, and will continue to advance the purposes of the Land Use Code as contained
in Section 1.2.2.
Any finding made under subparagraph (1), (2), (3) or (4) above shall be supported by specific
findings showing how the plan, as submitted, meets the requirements and criteria of said
subparagraph (1), (2), (3) or (4).
Summary
The details of each of the three modifications which are the subject of Mayor Pro Tem Ohlson's
Notice of Appeal are found beginning on the bottom ofpage 7 through page 15 of the staff report
for the Modification ofStandards Request for Siiage (Attachment 22 ofAttachment 3). This report
was included in the agenda materials presented to the Planning and Zoning Board, and includes a
description ofthestandards, excerptsfrom the Applicant's Modification Request Letter (Attachment
20 ofAttachment 3), and the staff evaluation and recommendation of each request.
The Planning and Zoning Board approved the modification request to allow full color electronic
message centers by a vote of five to two, finding that the request satisfied the hardship standard as
described in Section 2.8.2(H)(3) above because the unique size and configuration of the property
makes it difficult.for tenants to get adequate visibility along the street, thereby putting them at a
disadvantage.
The Board unanimously approved the modification request to allow the size of each of the two
electronic message center signs to exceed 50% of the sign face, finding that:
the request satisfied the 'equal to or better than'standard as described in Section
2.8.2(H)(I) above because the proposed sign size would be better than a larger sign
which would comply with the code and eliminate the need for this modification: and
2. the request satisfied the 'nominal, inconsequential'standard as described in Section
2.8.2(H)(4) above because the size exceeds the maximum allowed by only 6.85
square feet.
Lastly, the Board unanimously approved the modification request to allow two electronic message
center signs along the South College Avenue frontage instead of one such sign, finding that the
request satisfied the nominal, inconsequential' standard described in Section 2.8.2(H)(4) above
I
March 19, 2013
because the intent of the code is met due to the length of the College Avenue frontage being about
1850 feet and the signs being placed 1164 feet apart.
The specifics of the Board's motions and reasons for approving the three modifications begin on line
1, page 54 and continue through line 17, page 60 of the verbatim transcript (Attachment 6).
Council Action Needed
Council should review the record and determine if the decision of the Planning and Zoning Board
to approve the three modifications of standards should be upheld, overturned, modified, or
remanded to the Board for further consideration. "
Mayor Weitkunat stated she has a conflict of interest regarding this item and stated Mayor Pro Tern
Ohlson filed the appeal and can therefore not take the Mayor's place.
Councilmember Kottwitz made a motion, seconded by Councilmember Manvel, to assign
Councilmember Troxell as temporary Mayor Pro Tern for this item. Yeas: Weitkunat, Manvel,
Kottwitz, Ohlson, Horak and Troxell.
THE MOTION CARRIED.
Mayor Weitkunat withdrew from the discussion of this item due to a conflict of interest.
Deputy City Attorney Daggett reviewed the appeal process.
Peter Barnes, Zoning Supervisor, reviewed the requests for sign code modifications heard by the
Planning and Zoning Board. He noted four of the five modifications were approved unanimously
and one was approved by a vote of 5 to 2. Three of the approved modifications have been appealed.
The first allows for full -color digital signs, the second allows the digital aspect of the sign to account
for 64% of the area of the sign face, rather than the 50% limit per the sign code, and the third
modification would allow more than one electronic message center sign per street per development.
In this case, that would mean two rather than one electronic message center signs along College
Avenue. Barnes reviewed the standards examined by the Planning and Zoning Board when
considering modifications and discussed the proposed signage and staff recommendations for the
modifications.
Mayor Pro Tern Ohlson stated he visited the site simply to garner an impression of the geography.
Councilmember Manvel agreed with Mayor Pro Tern Ohlson.
Councilmember Troxell stated he and Councilmember Horak also attended the site visit.
APPELLANT PRESENTATION
Mayor Pro Tent Ohlson, appellant, provided a brief history of the City's sign code and stated it has
a tremendous positive impact on the urban fabric of Fort Collins. He withdrew his appeal relating
to the percentage of the sign size to be allowed as electronic. With regard to allowing two digital
signs, Mayor Pro Tent Ohlson stated he could not find any grounds on which to grant that
500
March 19, 2013
modification and stated it does not meet any of the four criteria necessary for the granting of a
modification and stated the two signs would be detrimental to the public good. With regard to
allowing full color electronic signage, Mayor Pro Tern Ohlson noted staff did not recommend
approval of this modification and also stated the granting of this modification would be detrimental
to the public good. He urged Council to uphold the integrity of the recently revised digital sign code
and noted driver safety should be taken into consideration as a possible detriment to the public good.
OPPONENT PRESENTATION
Carolyn White, land use counsel for the developer, stated there is a great amount of evidence
supporting the Planning and Zoning Board's decision to grant the variances. She reviewed the
public input at the hearing, which was generally supportive of the signage modifications. She stated
that support indicates the modifications would not be detrimental to the public good. Ms. White
reviewed the reasoning for the modification request to have two signs rather than one. She noted
the signs would be 1,164 feet apart and the sign code allows electronic signs to be only 100 feet
apart if they are on different properties. Staff recommended approval of this modification, and it
was granted. With regard to the full color electronic message centers, Ms. White stated the
developer is seeking a modification based on a unique hardship. She requested that Council uphold
the decisions of the Planning and Zoning Board.
Bob Walters, Walton Foothills Holdings, noted this is a regional mall and attracting the best national
tenants often requires national branding for signage and the proposed signage would allow for those
tenants located on the interior of the project to advertise and would allow space for public
announcements.
Julia Senesac, 1520 Hearthfire Drive, stated the property has no sight line from the south and it is
a unique property with a unique need for signage.
APPELLANT REBUTTAL
Mayor Pro Tern Ohlson referenced the staff recommendation opposing the granting of the variance
relating to the full color signs. He stated the success of the mall should not hinge on these
modifications and commended the high quality of life in Fort Collins combined with affordable
living. He stated the city's sign code contributes to this quality of life.
OPPONENT REBUTTAL
Ms. White requested that the decision of the Planning and Zoning Board be upheld and noted the
Board granted these modifications based on the criteria necessary. She noted there were very few
modifications requested on a project of this magnitude.
COUNCIL DISCUSSION
Deputy City Attorney Daggett noted the City Code provides that when a councilmember appeals an
item, that member also participates in the discussion as a councilmember. She suggested
referencing the modification related to two signs as modification one and the modification relating
to full color signs as modification two.
501
March 19, 2013
Councilmember Manvel requested clarification regarding non -digital signs on the site. Barnes
replied the sign package includes six monument signs along the College Avenue frontage, four of
which would be static and the other two of which are proposed to be the digital message center
signs. Those digital signs would be two-sided, but only one side of each would be digital.
Additionally, there are ten on -site traffic directional signs located interior to the site, three secondary
entry signs not located on dedicated streets, and six additional small static signs along Stanford.
Councilmember Manvel asked how large the signs along College Avenue would be allowed to be.
Barnes replied signs could potentially be 90 square feet per side; however, they are proposing 47.5
square feet. Two of the static signs are 90 square feet per side and two other project entry
monuments are 47.5 square feet.
Councilmember Manvel asked about the necessity for the signs to attract tenants, noting the
testimony that the project has great tenant interest. Ms. White replied there is a difference between
strong interest and signed leases. Tenant representatives are always concerned about visibility and
signage is a critical requirement.
Councilmember Manvel asked if so many wayfinding signs are actually necessary. Ms. White
replied there will be manybrand new tenants seeking to announce their presence, this effort is aimed
at the mall becoming a regional draw, and the entire sign program was designed to work as an
integrated whole.
Councilmember Manvel argued the digital signs are irrelevant in terms of the mall being a regional
draw. Ms. White replied the signs will provide information to individuals in Fort Collins who may
or may not be in town to shop at the mall.
Councilmember Manvel noted the sign code needs to provide a balance between not distracting
drivers and providing information. He asked if Ms. White would comment on the distractive
qualities of digital signs. Ms. White replied a variety of studies have been done regarding digital
billboards which have shown no difference from a safety perspective regarding LED versus static
signs. When LED signs are animated, scrolling, or rapidly changing, safety does start to become
impacted. The Colorado Department of Transportation has established a minimum dwell time of
5 seconds; however, the City of Fort Collins requires messages to remain for 60 seconds and there
is no proposal to deviate from that requirement.
Councilmember Manvel asked about the attraction difference between a single color and full color
sign. Ms. White replied the attention is probably similar; however, the recognition of what the sign
is trying to promote is different.
Suspension of Rules
Councilmember Manvel made a motion, seconded by Mayor Pro Tem Ohlson, to suspend the rules
and extend the meeting past 12:00 a.m. Yeas: Manvel, Ohlson and Troxell. Nays: Kottwitz and
Horak.
THE MOTION CARRIED.
502
March 19, 2013
Councilmember Kottwitz made -a motion, seconded by Councilmember Horak, to uphold the
decision of the Planning and Zoning Board related to the modification for two signs, Section
3.8.7(M)(4)(h).
Mayor Pro Tem Ohlson stated he would support the motion.
Councilmember Horak stated the testimony and distance separating the signs make this modification
acceptable.
Councilmember Kottwitz stated the two sign modifications appear to be inconsequential given their
separation.
The vote on the motion was as follows: Yeas: Horak, Manvel, Kottwitz, Ohlson and Troxell. Nays:
none.
THE MOTION CARRIED.
Councilmember Manvel made a motion,, seconded by Mayor Pro Tem Ohlson, to overturn the
decision of the Planning and Zoning Board related to full color signs, Section 3.8.7(M)(4)(c).
Councilmember Manvel argued.the full color signs would be detrimental to the public good as the
sign code was revised through a lengthy public process. He argued public safety and community
aesthetics would be negatively impacted and stated it is a stretch that this modification is necessary
due to a unique hardship, given the number of other signs on the site.
Councilmember Kottwitz disagreed and stated the mall property does provide a unique hardship and
the regional aspect of the mall necessitates proper signage.
Councilmember Manvel stated people will soon discern what stores and features are on the property
and full color digital signage is not necessary.
Mayor Pro .Tem Ohlson commended staffs work on the project and integrity regarding not
recommending approval of the full color modification.
Councilmember Troxell stated he would oppose the motion.
Councilmember Horak asked if the other approved modifications are similar to previous requests
in the city. Barnes replied in the affirmative and noted no other modification requests have been
received regarding the year -old digital sign code.
Councilmember Horak questioned whether or not a hardship has been proven. He stated making
this change for the entire city makes more sense than just arguing a hardship for this property.
The vote on the motion was as follows: Yeas: Manvel, Ohlson and Horak. Nays: Troxelf and
Kottwitz.
THE MOTION CARRIED.
503
March 19, 2013
Deputy City Attorney Eckman recommended Council modify the Planning and Zoning Board's
approval of the PDP to include a condition that the PDP not contain any electronic message center
signs, except those in compliance with Section 3.8.7(M)(4)(c).
Councilmember Manvel made a motion, seconded by Mayor Pro Tern Ohlson, to modify the
Planning and Zoning Board's approval of the PDP to include a condition that the PDP not contain
any electronic message center signs, except those in compliance with Section 3.8.7(M)(4)(c). Yeas:
Manvel, Ohlson and Horak. Nays: Troxell and Kottwitz.
THE MOTION CARRIED.
Other Business
Mayor Pro Tern Ohlson noted the regular April 2, 2013 Council meeting will not be cancelled.
Councilmember Manvel made a motion, seconded by Councilmember Troxell, to call a Special
Council meeting for April 9, 2013. Yeas: Manvel, Kottwitz, Ohlson, Horak and Troxell. Nays:
none.
THE MOTION CARRIED.
Councilmember Troxell made a motion, seconded by Councilmember Kottwitz, to direct the City
Manager to communicate with PSCo via letter and/or other communications about the impact of its
pipeline project. Yeas: Manvel, Kottwitz, Ohlson, Horak and Troxell. Nays: none.
THE MOTION CARRIED.
Adjournment
Councilmember Kottwitz made a motion, seconded by Councilmember Manvel, to adjourn to 6:00
p.m. on March 26, 2013, in order to consider any additional business that may come before the
Council. Yeas: Manvel, Kottwitz, Ohlson, Horak and Troxell. Nays: none.
THE MOTION CARRIED.
The meeting adjourned at 12:20 a.m.
0(1T Cp<
ATTEST: OF,� •(P
G0a4AA� z
City Clerk
504