HomeMy WebLinkAboutAgenda - Mail Packet - 2/13/2018 - City Council Finance & Audit Committee Agenda - February 12, 2018Finance Administration
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AGENDA
Council Finance & Audit Committee
February 12, 2018
10:00 am - noon
CIC Room - City Hall
Approval of Minutes from the January 8P
th
P Council Finance Committee meeting.
1. Utility LTFP Review - 4 Utilities 60 minutes L. Smith
2. CRISP Project Cost 30 minutes C. Workman
3. Broadband Debt Issuance 20 minutes T. Storin
Council Finance Committee & URA Finance Committee
Agenda Planning Calendar 2018
RVSD 02/08/18 ck
Feb 12P
th
P
Utility LTFP Review – 4 Utilities 60 min L. Smith
CRISP Project Cost 30 min C. Workman
Broadband Debt Issuance 20 min T. Storin
URA
Feb 27P
th
Broadband Debt Issuance 60 min T. Storin
URA Mid-Town Project Review 30 min J. Birks
Mar 19P
th
City Fund Implementation 30 min M. Beckstead
N. Bodenhamer
Vine/Lemay – Financing Alternatives 30 min C. Crager
M. Beckstead
KFCG Expiration 30 min G. Sawyer
Metro District Policy 30 min P. Rowe
URA
April 16P
th
Oakridge Fee Waiver Request 20 min S. Beck-Ferkiss
DDA Credit Line Renewal 30 min M. Robenalt
URA County IGA – URA TIF Evaluation Process 30 min J. Birks
Future Council Finance Committee Topics:
BFO Assumption Review - May
Phase II Fee Discussions – Development Review Fees & Wet Utilities
KFCG Expiration
Future URA Committee Topics:
Annual URA District Updates – Anticipate memo format
Finance Administration
215 N. Mason
2nd Floor
PO Box 580
Fort Collins, CO 80522
970.221.6788
970.221.6782 - fax
fcgov.com
Finance Committee Minutes
01/08/18
10:00 am - 10:45 am
CIC Room - City Hall
Council Attendees: Mayor Wade Troxell, Ross Cunniff, Ken Summers, Gerry Horak
Staff: Darin Atteberry, Mike Beckstead, Jeff Mihelich, Travis Storin, John Duval, Noelle
Currell, Tyler Marr, Laurie Kadrich, Joe Olson, Matt Fater, Matt Day, Kurt Friesen,
Jackie Thiel, Alyssa Johnson, Patrick Rowe, Josh Birks, Kelly DiMartino
Others: Kevin Jones (Chamber of Commerce), Dale Adamy (Citizen)
Meeting called to order at 10:08 am
Ross Cunniff moved to approve the Minutes for the November 20P
th
P Council Finance Committee
Meeting. Ross Cunniff motioned for approval. Ken Summers seconded the motion. Minutes approved.
A. Lane Rental Fee / Proposed Lane Closure Policy
Laurie Kadrich, Planning Development and Transportation Director
Joe Olson, City Traffic Engineer
EXECUTIVE SUMMARY
Maintenance and improvement projects within the City’s Right Of Way (ROW) are important and
necessary for a healthy, growing, and vibrant community. However, roadway congestion, travel
delays, increased vehicle emissions and adverse business impacts related to work areas are a major
source of frustration. In addition, work areas create traffic safety concerns for both workers and the
community. There is a need to better regulate work areas. The proposed lane closure policy will use
mobility data to determine the best and safest times for work to occur on different roadways and
incentivize projects through varying fees to support safety and thoughtfully minimize impacts to the
traveling public, adjacent businesses, and nearby residents. The new fee structure, including fines for
unauthorized work is proposed to be implemented using existing staff starting in the 2018 construction
season.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Staff seeks input on the proposed policy change, and comments on areas of concern.
2
BACKGROUND/DISCUSSION
UIntroduction
Work Area Traffic Control (WATC) permits are required for all work within the ROW, such as roadway
maintenance, utility work, major capital projects, traffic operations work, pedestrian improvements,
landscaping, and various private endeavors on or adjacent to roadways. The permits have historically
involved a single minimal flat fee regardless of impact or duration. Determination of any limits of work
within the ROW has been done on a case-by-case basis using previous experience, engineering
judgement, and broad assumptions related to traffic impacts. There are no fines for unauthorized
work beyond approved times resulting in frequent non-compliance with work time limitations.
As Fort Collins has grown, the number of projects in the roadway has dramatically increased (WATC
permits have increased 66% in the past six years to more than 2,800 per year in the City). The result is
that roadway congestion, delay and increased vehicle emissions due to construction has become an
increasing safety concern (for workers and travelers) and source of frustration for the community.
UPurpose and Goals
A new approach is based on the following justifications:
• Congestion (partially a result of work zones) is consistently one of the top two issues for Fort Collins
residents in community surveys. City Council has indicated interest in addressing congestion and
any effort to limit work zone impact is typically welcomed.
• Work zone congestion and delays create safety concerns for both workers and road users, and has
broad based negative impacts on mobility, travel time reliability, air quality, and livability for those
along detours and neighborhood cut through routes.
• The Federal Highway Administration (FHWA) has an adopted the Work Zone Safety and Mobility
Rule that requires agencies that receive federal-aid funding to broadly consider safety and mobility
impacts of work zones and implement strategies that help manage these impacts.
The proposal is to utilize mobility data to determine the least impactful and safest times for crews to
be in the roadway, and incentivize projects through varying fees to thoughtfully plan construction and
minimize impacts to the community. This policy is applicable for any work that requires a Work Area
Traffic Control permit. This includes work by other City Departments for reasons of fairness, equity,
and community impact.
The anticipated outcome of the policy is to strike an appropriate balance between accommodating the
broadest allowable timeframe for work to occur, lessening impacts for road users and adjacent
businesses and supporting safety for everyone.
UApproach
Determining the most appropriate work hours for projects along arterial streets within the City has
been done utilizing a combination of the City’s hourly traffic count information and real time Bluetooth
travel time data. For each arterial link in each direction a performance pattern has been identified by
hour and day of the week, resulting in an understanding of the anticipated mobility impact of
3
construction work. The mobility impacts are compiled into four categories from low impact to
exceptional impact by time of day.
These impact categories are used to populate a look up table that identifies the best and safest time to
work specific to locations along arterials throughout the City. The table identifies daily fee surcharges
for work that will occur during more impactful times.
The policy includes increasing fees for work not completed on time and requiring extensions, and
allows assessment of fines for unauthorized work outside of approved hours.
Some exceptions to the fees are identified, including weather days, emergency work, short term
maintenance, or projects that are incentivized for efficient work in other manners.
UFinancial Impact
The current annual revenue for Work Area Traffic control permits (the one-time fee per project) is
about $63,000. The fee on local and collector roads is being lowered, but will be charged on a daily
basis. This is anticipated to roughly result in approximately the same revenue as currently received.
For the approximately 50% of projects that impact arterials, the amount of new revenue collected will
depend on how contractors or departments choose to do their work. The goal is to have work done
efficiently during less impactful and less expensive times. We also expect the number of requested
permit days to decrease as contractors become thoughtful about actual approval days needed. The
number of fines assessed is also unknown as contractors will hopefully minimize their unauthorized
work. Having noted the uncertainty, in the first year of the program, additional revenue could be
several hundred thousand dollars. The goal is for the revenue to decrease as the program matures.
Policy review and fee adjustments will be done on an annual basis.
UNext Steps
City staff is beginning outreach to other departments, as well as the business and contractor
community. We’re also working with the City Attorney’s office to detail the legal requirements for the
fee adjustments and implementation of the fines. The anticipated roll out of the program would be
this spring.
Discussion / Next Steps:
Gerry Horak; are we tracking measuring this on the community dashboard?
Joe Olson: we are working with Lawrence Pollack to create a second metric for travel time reliability.
Laurie Kadrich; This doesn’t always lead to night work - we used to have a blanket policy that they
couldn’t start before 8:30 am and had to end work by 3:30 pm- work could start earlier on some roads
- for example - College Ave - all flow is north bound in the morning rush - they could work in
southbound lanes without a huge impact - some opportunity to do work when they couldn’t before
4
Permits - currently $35 permit with no time limit - no incentive for them to be timely
• Will now be permit charge per day - there will be fines if they go long or short
• Surcharge - only for arterial streets - best time to work to minimize surcharge - we are going to ask
people to put in more effort up front (time to do work /duration / their labor costs)
• Goal is to roll this out March of this year
Goal is not to make money - not a fee in the traditional sense - current revenue of $63K per year.
Money collected would go into the transportation reserve - then a conversation about best use for that
money - Do we hire more traffic control supervisors?
Engineering Dept - Capital project on Lemay South of Horsetooth - new box culvert where the sinkhole
was - fixing that permanently - $5k per day incentive for contractor to finish early - fine if they go long
Mayor Troxell; will there be any staffing impact due to the process taking more time per permit?
Joe Olson; the process will be straightforward – look up table - contractors will have access to all of the
information – hoping this will not a huge impact to staff
Darin Atteberry; original proposal did include an additional FTE – they went back and decided the FTE
would not needed
Gerry Horak; how have you engaged the folks this will impact?
Joe Olson; we started internally with city departments to talk about it and plan to go out to general
contractors following this meeting.
5
Ross Cunniff asked if they track pedestrian traffic at the Prospect / College intersection as that was one
of the reasons it was done - would be curious to see if pedestrians are using it
Joe Olson; we don’t do that currently but when we get an updated number we will share that data.
Ross Cunniff; Turning movement onto southbound College has been good
Mayor Troxell; neighborhood on Remington - there were challenges there during construction but is
now operating well
Joe Olson; keep people on arterials so they are not diverted – it doesn’t feel as congested because
there is a place to be
Mayor Troxell; Max and the Railroad just west of intersection - don’t seem to be causing issues
Joe Olson; we changed the timing of the Max through that area to meter that and westbound thru
traffic and northbound left turn changed so we have extra storage are not backing up on the tracks.
Mayor Troxell, Ross Cunniff and Ken Summers all commented that they support this plan to move
forward.
OTHER BUSINESS:
Mike Beckstead; Bond Issuance for Broadband is scheduled to go to Council for First Reading on March
20P
th
P - Staff would like to have a Council Finance meeting to review prior. Could we work with Sarah
Kane to schedule a Special Council Finance Committee Meeting the week of Feb. 26P
th
P?
Committee approved moving forward with scheduling of Special Council Finance Committee Meeting.
NOTE: Mike Beckstead will miss the Feb. 12P
th
P Council Finance Committee Meeting - Travis Storin will
lead the dialog and the discussion.
Ross Cunniff; re: October 31P
st
P memo on Building Development and Inspection Fees - think is tells a
misleading story the way it was written - buried in there - we changed the way we collect fees
from 80% cost recovery to 100% cost recovery- not a fair comparison - we changed some things so we
are collecting more - only chart after the 2012 change
ACTION ITEM: Ross Cunniff requested a revised memo - new chart to include actual dollar amounts
for each year after the 2012 change to 2016 - include 2017 if we have the data. Add up the total plus
or minus dollars to date. Not right for us to be collecting that money and putting it back in the
General Fund - we need to be putting it back in the actual inspections.
ACTION ITEM: Ross Cunniff - 2P
nd
P memo requested re: Non-utility Debt - 2012 to current - non-utility
debt - Receiving this memo within the next couple of weeks is acceptable.
6
• List of all current non-utility loans
• What properties were pledged again each loan
• Annual payments by fund source for each loan
• Date of final payment for each loan
• List of projects we have discussed doing debt financing on - the amounts we have brainstormed for
each and the date the debt financing would need to be in place for (Prospect / I25 intersection,
Police Training Facility, Prospect, Vine /Lemay, Timberline) and others as contemplated by staff
Mike Beckstead; the reason we went back to 2009 - 2010 was to show the variation during a period of
slow construction - we have been in an upcycle since 2012
Mayor Troxell; Per discussion in Leadership Meeting - we discussed the postponement of Xcel issue -
does this present any issues?
Mike Beckstead; we don’t think so - Xcel has been flexible and accommodating - Staff will put on hold
until Council directs we move forward
Meeting Adjourned at 10:40 am
WORK SESSION
AGENDA ITEM SUMMARY TEMPLATE
Staff: Lance Smith, Utilities Strategic Financial Director
SUBJECT FOR DISCUSSION – Utilities 2017 Capital Improvement Plans and Strategic Financial Plan
Update for the Wastewater and Stormwater Utilities
UEXECUTIVE SUMMARY
The purpose of this agenda item is to provide the Council Finance Committee with an overview of the
planning processes underway within Fort Collins Utilities. This agenda item will focus on the Wastewater
and Stormwater Enterprise Funds. The Light & Power and Water Enterprise Funds were presented for
discussion last November. The 2017 Capital Improvement Plans (CIPs) and the 2017 Strategic Financial
Plans are outlined. The resulting investment projections set the basis for beginning the 2019-20
Budgeting For Outcomes (BFO) cycle. The overall 10 year rate projections for all 4 utilities is also
presented here and the impacts to the typical residential customer’s bill.
UGENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does the Council Finance Committee support the Utilities Strategic Financial Plan assumptions
ahead of the 2019-20 BFO cycle? In particular, the projected rate increases necessary to meet
anticipated revenue requirements?
2. How would the Council Finance Committee support including the need to issue debt in the
Stormwater Enterprise Fund as part of the 2019-20 BFO cycle?
UBACKGROUND/DISCUSSION
The financial health of each utility Enterprise Fund depends on active management of ongoing operating
and maintenance expenses as well as planning for large capital expenditures. In some years it is
expected that the capital investment alone may exceed the annual operating revenues for each Fund
even before considering operating expenses. Thus the capital investment required to maintain the
current levels of service provided by each of the four utility services to the community requires a long
planning horizon and consistent reevaluation and prioritization. Additionally the expected operating and
maintenance expenses must be forecasted and managed so that the financial sustainability of each utility
is ensured while continuing to provide the levels of service expected without large rate increases being
necessary in any given year.
U10 Year Capital Improvement Plans
The capital improvement planning process begins with periodically developing and updating Operational
Master Plans for each utility. These plans assess current infrastructure for needs and risks and review
expected growth and regulatory requirements. The Master Plans generate a list of recommended capital
projects over the planning horizon which are then included in the Capital Improvement Plans. The Utility
Asset Management program has developed a rigorous process to prioritize necessary capital investments
that has been in place since 2014. This prioritized list includes the associated annual capital investment
which becomes an input into the long term Strategic Financial Plan. This list is updated ahead of the two
year BFO process and prioritized using metrics intended to measure the levels of service that each utility
is targeting to provide to the community. The financial position of each utility is also reviewed in this step
with the output being a recommended path forward which may involve rate adjustments and future debt
issuances in order to achieve the operational objectives and needs of each utility.
Wastewater CIP
The 10 year CIP for the Wastewater Fund consists of projects needed to provide adequate capacity to
prevent backflows for new services, nutrient removal and other regulatory requirements, water quality lab
improvements and system renewal of existing reclamation plant and sewage collection assets.
The 2018 CIP for Wastewater includes an increase in identified capital work over the 2016 CIP. A Master
Plan is being finalized for the collection system pipes for the first time. This plan will include a condition
assessment of every pipe segment in the service area which will be used to determine the sequence of
renewal for these linear assets. The 2016 CIP identified $60-80M as being needed to meet the new
Assess Operational
Needs / Risks
Determine Optimal
Solutions &
Mitigations
Identify Anticipated
Capital Projects Over
Planning Horizon
Establish Capital
Project Prioritization
Criteria
Determine Relative
Weighting of Criteria
Prioritize Projects with
Criteria
Review Financial
Position of Each Utility
Determine Capital
Investment
Capacities
Recommend
Financial Strategy to
Achieve Operational
Objectives
Master
Planning
Capital
Improvement
Planning
Strategic
Financial
Planning
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Wastewater Fund Capital Improvement Plan
Environmental Services
Service Area - wide
Water Reclamation
Wastewater Collection
Prior Appropriations
Historical Ave Capital 2007-2016
Ave Capital Investment 2017-2026
regulatory requirements for releasing water back into the river around nitrogen and phosphorous levels
and the temperature of the water being re-introduced to the river. As the specifics of the regulations
become more well defined it is expected that these costs could be less than this previous estimate by
leveraging other improvements that are necessary to the reclamation facility between now and the next
permitting process. The large anticipated need for Environmental Services in 2020 is associated with the
need to address aging laboratory facilities and the possibility of realizing some savings by combining the
Water Quality Lab and the Pollution Control Lab into a single building.
Stormwater CIP
The CIP for the Stormwater Fund includes new cost estimates for all of the anticipated projects. Updating
the cost estimates, along with some preliminary design refinements to some of the project requirements,
increased the anticipated capital investment needed to build out the stormwater infrastructure from
$208M in the 2016 CIP to $272M. Cost adjustments for stream restoration projects are also included in
the model which now shows $70M in stream restoration projects separate from the infrastructure projects.
The CIP is now being proposed to be built over a 25 year period which as the graph below shows will still
require investing almost 3 times as much each year in capital infrastructure than the previous decade’s
level of investment. It is shown below as being a levelized investment because the prioritization is not
completed yet and the investments will require significant debt issuances to fund the major outfall projects
that are still needed to complete the buildout.
UOperating Expense, Revenue and Income Forecasts
Each utility collects operating revenues through monthly charges to its ratepayers. These revenues are
used to operate and maintain each utility as well as for making capital investments in system renewal and
improvements. Because operating expenses are expected to be recovered through monthly operating
revenues it is first necessary to determine what the expected operating and maintenance (O&M) costs will
be for each utility. The Strategic Financial Plan includes a section on O&M for each utility including a
forecast of how much O&M can grow annually while meeting the expected capital investments.
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
504 - Stormwater Fund Capital Investment
Stream Rehabilitation Small Capital
Major Capital Historical Ave Capital 2007-16
Ave Capital Investment 2019-2044 Previous Forecasted Ave Capital Investment 2017-31
Wastewater Operations
Wastewater O&M expenses have increased at a modest rate over the past decade just exceeding the
long term rate of inflation. This modest growth in expenses is forecasted to continue closer to the long
term rate of inflation as the two largest increases came from engineering costs that have been adjusted to
market recently and administrative charges that will be held to the rate of inflation.
The colored area represents the 95% confidence band around the expected operating expense.
Operating revenues have grown significantly over the past decade through rate increases and growth
putting this utility in a good financial position. Based on the projected revenue requirements for O&M and
capital investment revenues are projected to remain essentially flat with some growth attributed to new
customers within the defined service area.
The colored area represents the 95% confidence band around the expected operating expense.
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Annual Operating Expenses
Wastewater Operating Expenses (2007-2026)
Operating Expenses
(2.94% per yr)
Assuming Historical Trend
(3.92% per yr)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Annual Operating Revenues
Wastewater Operating Revenues (2007-2026)
Operating Revenue
(0.36% per year)
Assuming Historical Trend
(5.30% per yr)
The combination of operating revenues increasing at a faster rate than operating expenses has allowed
this utility to make necessary capital improvements over the past decade and positions it well to meet the
capital needs in the coming decade. The last time the outstanding debt for this utility was reviewed by a
rating agency in early 2017, Fitch upgraded the rating on the outstanding 2009 issued debt to AAA from
AA+.
Stormwater Operations
Stormwater O&M has grown at a faster rate than wastewater as more infrastructure is built requiring
O&M. The financial forecast recognizes this but assumes that the growth can be managed to increase at
a rate closer to the rate of inflation. Like Wastewater, the largest increases were seen in engineering and
administrative charges.
The colored area represents the 95% confidence band around the expected operating expense.
($5,000,000)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Wastewater Fund Operating Income (2007-2026)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
Annual Operating Expenses
Stormwater Operating Expenses (2007-2026)
Operating Expenses
(3.48% per yr)
Assuming Historical Trend
(4.17% per yr)
Operating revenues have grown modestly over the past decade with the single 5.0% rate increase being
in 2017. Based on the projected revenue requirements for O&M and capital investment revenues are
projected to remain essentially flat with some growth attributed to new development.
The colored area represents the 95% confidence band around the expected operating expense.
The combination of operating revenues increasing very modestly and O&M increasing at a faster rate will
over time reduce the operating income being generated for this utility. However, operating income is
expected to remain strong over the coming decade as shown in the graph below.
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
Annual Operating Revenues
Stormwater Operating Revenues (2007-2026)
Operating Revenue (2.16% per
year)
Assuming Historical Trend
(1.91% per yr)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Stormwater Operating Income (2007-2016)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
URate Adjustment and Debt Issuance Forecasts
Wastewater Rate and Debt Forecasts
Rate increases are not anticipated to be necessary over the coming decade although any significant
change in the necessary capital investments or regulations may require modest adjustments to ensure
adequate operating revenue is generated to support the system renewal investments and nutrient
removal investments that will be required before the next operating permit is issued.
Stormwater Rate and Debt Forecasts
With the strong operating income being generated every year in this utility only providing a third of the
anticipated capital investment required to fully build out the infrastructure for the community over the next
25 years it will be necessary to issue significant debt to complete the remaining flood mitigation
infrastructure. Significant rate increases could be implemented rather than, or in conjunction with, issuing
debt, however, the capital needs are not ongoing capital needs. Rates are usually adjusted to fund
ongoing operational and capital needs. There is significant debt capacity in this fund that operates with
an operating margin above 40%. Increasing rates would increase the operating margin but not
necessarily allow for the initial infrastructure to be built on an accelerated schedule because of the
relative scale of the capital investment compared to the operating revenues. The anticipated levelized
annual capital investment required to complete the initial build out over the next 25 years along with minor
capital investments required on existing infrastructure is $16M per year or 100% of the 2017 operating
revenue. Infrastructure that is expected to last for at least 50 years into the future could be financed over
that time period with those customers benefiting from the new investment paying for its cost rather than
increasing rates substantially. The table below shows the amount of debt that would need to be issued
over the next decade to establish this 25 year build out schedule while adhering the financial boundary
conditions of gradual, modest rate adjustments, positive operating income and a debt coverage ratio of at
least 2.0.
UOverall Rate Impacts
L&P Rate and Debt Forecasts
In November 2017 the L&P and Water Funds were discussed with the Council Finance Committee and
the following rate and debt issuances were presented. There have been no material changes to those
two forecasts since that time. Based on the significantly higher CIP and the assumption that O&M
expense growth is limited to the rate of inflation over the coming decade, it is expected that there will
need to be two significant rate adjustments in 2019 and 2020 followed by a debt issuance in 2023.
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 3.0% 3.0% 0.0% 0.0% 0-2% 0-2% 0-2% 0-2% 0-2% 0-2%
Debt Issuance $M
$80-100M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 5% 0% 0% 0.0% 0-3% 0-3% 0-3% 0-3% 0-3% 0-3%
Debt Issuance $30-35M $25-30M
*$272M of capital work is expected to be needed between 2019 and 2044.
$70M of stream restoration work has also been identified here.
The issuance of debt for electric distribution infrastructure in 2023 will allow for the issuance of all debt
prior to support the broadband initiative. It is expected that the increased operating revenue from the
broadband initiative by 2023 will increase the debt capacity of this Fund and cover the debt service
expense associated with the debt issued for the initiative.
Water Rate and Debt Forecasts
With the two significant rate increases in 2017 and 2018 along with the operating budget cuts that were
included in the 2017-18 BFO cycle, minimal rate increases are forecasted for the coming decade however
it will be necessary to issue debt in 2018 to fund some near term capital work and then again in 2022.
These issuances are timed with the retirement of existing debt so that the annual debt service expense
will remain at or below the current levels over the coming decade.
Overall Rate Impact
Based on the 10 year rate forecasts for each of the four utilities, the chart below summarizes the
estimated rate impact to the average residential utility bill relative to the 2018 rates. Utility rates will
continue to increase but based on the current projections from Platte River and the current CIPs for each
of the utility funds it appears that rates will rise at a rate that is less than 2% annually in total over the
coming decade.
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 3.5% 1.8% 5.0% 4.9% 2-3% 0-2% 0-2% 1-3% 1-3% 0-2%
Debt Issuance $M $20.0
$165M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations.
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 5% 5% 0-1% 0-1% 0-1% 0-2% 0-2% 1-3% 1-3% 1-3%
Debt Issuance $M $5-8 $21-25
$168M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Typical Residential Customer - Monthly Utility Bill
Forecasted (1.62% annually)
Historical Trend (3.44% annually)
UConclusion
As shown there will be a need for considerable capital investment in each of these utility services in the
coming decade and beyond. This is not unexpected given the anticipated regulatory requirements of the
wastewater utility and the need to complete the initial infrastructure build out for the stormwater utility.
The low utility rates and high level of customer satisfaction are the results of City Leadership, both past
and present, showing tremendous foresight and commitment to these municipal services and to the
planning, operational and customer focused efforts of City staff. This update to the Council Finance
Committee is intended to maintain this tradition through a long term Utilities Strategic Financial Plan
ahead of the 2019-20 Budgeting For Outcomes process.
UAttachments
Attachment 1 - Powerpoint presentation
1
Utilities Strategic Financial Plan & Recommendations
Lance Smith, Utilities Strategic Finance Director
2-12-2018
Purpose and Direction Sought
Objective:
• Provide an update on the Capital Improvement Plans and Strategic Financial
Plan for the Wastewater and Stormwater Enterprise Funds
• Recommend strategic path forward to meet 10 year operational and financial
objectives ahead of the 2019-20 Budget cycle
Direction Sought:
• Does the Council Finance Committee support the Utilities Strategic Financial
Plan assumptions ahead of the 2019-20 BFO cycle? In particular, the rate
increases associated with the anticipated revenue required?
• How would the Council Finance Committee support including the need to issue
debt in the Stormwater Enterprise Fund as part of the 2019-20 BFO cycle?
2
Utilities Planning Process
3
Assess Operational
Needs / Risks
Determine Optimal
Solutions &
Mitigations
Identify Anticipated
Capital Projects
Over Planning
Horizon
Establish Capital
Project Prioritization
Criteria
Determine Relative
Weighting of Criteria
Prioritize Projects
with Criteria
Review Financial
Position of Each
Utility
Determine Capital
Investment
Capacities
Recommend
Financial Strategy to
Achieve
Operational
Objectives
Master
Planning
Capital
Improvement
Planning (CIP)
Strategic
Financial
Planning
2 years 2 years 5-7 years
Objectives
Utilities Strategic Financial Plan
Objectives
• Maintain adequate reserve balances such that:
• Meet Minimum Reserves Policy
• Reserves and revenues adequate to cover near term capital
requirements
• Maintain current credit ratings for each Enterprise Fund and the City
• Avoid rate spikes by limiting rate increases to no more than 5%
annually
4
5
Wastewater Enterprise Fund
Wastewater Fund CIP
6
2017 Operating Revenue was $24M
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Wastewater Fund Capital Improvement Plan
Environmental Services
Service Area - wide
Water Reclamation
Wastewater Collection
Prior Appropriations
Historical Ave Capital 2007-2016
Ave Capital Investment 2017-2026
Wastewater Operating Income
7
($5,000,000)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Wastewater Fund Operating Income (2007-2026)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
Wastewater Financial Health Forecast
8
($1,000,000)
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000 Operating Income
$0
$10,000,000
$20,000,000
$30,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Outstanding Debt
$0
$20,000,000
$40,000,000
$60,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Available Reserves
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0% Rate Increase
Wastewater Rate Pressures
9
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Annual Operating Expenses
Wastewater Operating Expenses (2007-2026)
Operating Expenses
(2.94% per yr)
Assuming Historical Trend
(3.92% per yr)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Annual Operating Revenues
Wastewater Operating Revenues (2007-2026)
Operating Revenue
(0.36% per year)
Assuming Historical Trend
(5.30% per yr)
Wastewater Rate & Debt Forecasts
10
• Operating Income remains positive although decreasing without modest rate
adjustments (1-2% in some years)
• No debt issuance is necessary due to healthy Available Reserves
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 3.0% 3.0% 0.0% 0.0% 0-2% 0-2% 0-2% 0-2% 0-2% 0-2%
Debt Issuance $M
$80-100M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations
11
Stormwater Enterprise Fund
Stormwater Fund CIP
12
2017 Operating Revenue was $16.8M
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
504 - Stormwater Fund Capital Investment
Stream Rehabilitation Small Capital
Major Capital Historical Ave Capital 2007-16
Ave Capital Investment 2019-2044 Previous Forecasted Ave Capital Investment 2017-31
Stormwater Fund Operating Income
13
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Stormwater Operating Income (2007-2016)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
Stormwater Fund Financial Health Forecast
14
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000 Operating Income
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Outstanding Debt
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
$20,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Available Reserves
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0% Rate Increase
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 5% 0% 0% 0.0% 0-3% 0-3% 0-3% 0-3% 0-3% 0-3%
Debt Issuance $30-35M $25-30M
*$272M of capital work is expected to be needed between 2019 and 2044.
$70M of stream restoration work has also been identified here.
Stormwater Rate & Debt Forecasts
15
• Near term capital needs are met with debt issuance for 2019-20
BFO cycle
• Initial buildout of infrastructure to be completed by 2044
16
Typical Residential Customer – Monthly Bill
Based on Forecasted Rate Adjustments
17
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Typical Residential Customer - Monthly Utility Bill
Forecasted (1.62% annually)
Historical Trend (3.44% annually)
Purpose and Direction Sought
Objective:
• Provide an update on the Capital Improvement Plans and Strategic Financial
Plan for the Wastewater and Stormwater Enterprise Funds
• Recommend strategic path forward to meet 10 year operational and financial
objectives ahead of the 2019-20 Budget cycle
Direction Sought:
• Does the Council Finance Committee support the Utilities Strategic Financial
Plan assumptions ahead of the 2019-20 BFO cycle? In particular, the rate
increases associated with the anticipated revenue required?
• How would the Council Finance Committee support including the need to issue
debt in the Stormwater Enterprise Fund as part of the 2019-20 BFO cycle?
18
19
20
November 2017 CFC Presentation slides
21
Light & Power Enterprise Fund
Light & Power Fund CIP
22
2016 Operating Revenue not used for Purchased Power expense was $36M
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Light & Power Fund Capital Improvement Plan
New Capacity Fiber Optics Improvements Substation Improvements Operational Technology
Distribution System Improvements Annexations Service Area - wide
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Light & Power Fund Capital Improvement Plan
New Capacity Fiber Optics Improvements Substation Improvements Operational Technology
Distribution System Improvements Annexations Service Area - wide Historical Ave Capital 2007-16
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Light & Power Fund Capital Improvement Plan
New Capacity Fiber Optics Improvements
Substation Improvements Operational Technology
Distribution System Improvements Annexations
Service Area - wide Historical Ave Capital 2007-16
Previous CIP Estimated 2017-2026 Capital Investment
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Light & Power Fund Capital Improvement Plan
New Capacity Fiber Optics Improvements
Substation Improvements Operational Technology
Distribution System Improvements Annexations
Service Area - wide Historical Ave Capital 2007-16
Ave Capital Investment 2017-26 Previous CIP Estimated 2017-2026 Capital Investment
• Includes
service area
wide efforts
Light & Power Operating Income
23
($20,000,000)
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
$140,000,000
$160,000,000
$180,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Light & Power Fund Operating Income (2007-2026)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
Reserves have come down
$12.7M in the last 3 years
Operating revenues
are expected to
exceed operating
expenses beginning
in 2019
Light & Power Financial Health Forecast
24
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0% Rate Increase
($5,000,000)
($2,500,000)
$0
$2,500,000
$5,000,000
$7,500,000
$10,000,000
$12,500,000
$15,000,000 Operating Income
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Available Fund Balance
$0
$10,000,000
$20,000,000
$30,000,000
2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Outstanding Debt
Assumptions:
1. AnnualRate increases limited to 5%.
2. Debt issued no more often than once every 3 years.
Light & Power Rate Pressures
25
$-
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
Annual Operating Expenses
Light & Power Fund Operating Expenses (2007-2026)
Operating Expenses
(2.43% per yr)
Assuming Historical Trend
(5.34% per yr)
Limit O&M
inflation to
2.4%:
• Assumes
PRPA
increase of
2.0%
• Increased
efficiencies
• CIP
Light & Power Rate Pressures
26
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Fort Collins Loveland Longmont Colorado Springs
Renewable and Energy Service Expenses as a % of
2016 Distribution O&M
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Light & Power Renewable and Energy Efficiency Initiatives (2007-2016)
Purchase Power - Community Renewables
(54% annual increase since 2010)
Energy Services
This $6.0M increase (17% annual increase since 2007)
represents 4.8% of
2016 operating revenue
Fort Collins is spending almost 4 times the
percent of neighboring cities on these
services
Light & Power Rate & Debt Forecasts
27
• Near term electric capital needs met through rate increases in 2019 and 2020
• Operating Income becomes positive and Available Reserves healthy
• No debt issuance is necessary for electric infrastructure until 2023
• Near term debt capacity is available for broadband initiative
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 3.5% 1.8% 5.0% 4.9% 2-3% 0-2% 0-2% 1-3% 1-3% 0-2%
Debt Issuance $M $20.0
$165M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations.
28
Water Enterprise Fund
Water Fund CIP
29
2016 Operating Revenue was $29.7M
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Annual Capital Investment
Water Fund Capital Improvement Plan
Prior Appropriations Environmental Services Water Distribution
Service Area - wide Water Production Water Resources
Ave. Capital Investment 2017-26 Historical Ave Capital 2007-16
Water Fund Operating Income
30
($5,000,000)
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Water Fund Operating Income (2007 - 2026)
OPERATING INCOME
Total Operating Revenue
Total Operating Expenses
Water Fund Financial Health Forecast
31
($1,000,000)
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000 Operating Income
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Outstanding Debt
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026
Available Fund Balance
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0% Rate Increase
Water Rate & Debt Forecasts
32
• Near term capital needs are met with debt issuance for 2019-20
BFO cycle
• Very modest rate increases are expected to maintain positive
operating income
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Rate Increase 5% 5% 0-1% 0-1% 0-1% 0-2% 0-2% 1-3% 1-3% 1-3%
Debt Issuance $M $5-8 $21-25
$168M of capital work is expected to be needed between 2017 and 2026 in addition to the current capital appropriations
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Carol Workman, Acting Information Services Director (Police Services), Erik Martin,
Financial Analyst II (Police Services)
Date: February 12, 2018
SUBJECT FOR DISCUSSION - Combined Regional Information Sharing Project (CRISP)
EXECUTIVE SUMMARY
The Combined Regional Information Sharing Project (CRISP) is a regional partnership with
other Larimer County public safety agencies. CRISP provides a reliable public safety software
solution that allows regional agencies to share police and fire data, manage incident and provide
for redundancy and continuity of operations as necessary. The current system is scheduled for
replacement. The City of Loveland is interested in joining CRISP and this will increase the
overall cost of the project. Staff is asking for an additional appropriation of $1.98 million with
the understanding that all but $288K will be reimbursed from partner and member agencies.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
• Does Council Finance support bringing an additional appropriation request to City
Council for approval?
• If so, does Council Finance support an additional appropriation of $1.98M and approval
of the associated IGA.
• Does Council Finance support an exception to the competitive bid or proposal process to
purchase the system from Tritech Software Systems?
BACKGROUND/DISCUSSION
The concept of CRISP began in 2003, when Fort Collins Police Services and Larimer County
Sheriff’s Office were seeking a public safety software system that would provide for a Computer
Aided Dispatch (CAD), Records Management System (RMS) and Mobile Solution for their
agencies. Both agencies agreed to share in the cost, use and management of the new software
system and allow for other public safety agencies, known as “members” in the region to utilize
the system.
For many years, CRISP has provided a critical infrastructure for many agencies in Larimer
County and is relied upon daily for the operations of its members. The current software system
needs to be replaced and initial funding was approved in BFO offer (29.39).
Since receiving funding approval, the City of Loveland has expressed interest in joining CRISP.
The City of Loveland would be an equal partner in the system along with the City of Fort Collins
and Larimer County. Each partner would share equally in the costs, use and management of the
system.
The selected software vendor is Tritech Software Solutions and staff is also requesting approval
for an exception to the competitive bid or proposal process to utilize this vendor. An updated
IGA between the City, Larimer County, and the City of Loveland is being negotiated and the
design and scope of the new system is in its final stages. With the addition of Loveland and
other required project changes such as; hardware, implementation costs and interfaces, the
project has grown in complexity, size and scope and additional funding is required.
UStaff Recommendation
City staff is recommending approval for the additional appropriation including the Fort Collins
additional funding of $288K, the approval of the associated IGA and approval of an exception to
the competitive bid or proposal process.
UFinancial Impact
$3.43 million in funding was approved for the replacement of the CRISP system. The original
costs were in anticipation of an equal sharing with Larimer County. With the addition of the
City of Loveland, and other required scope changes, the new project costs are $5.41 million.
The City of Fort Collins is the purchasing agent for the CRISP project and a request for an
appropriation $1.98 million is required for the project. Reimbursement and additional funding
from partner and member agencies, leaves the Fort Collins specific funding needs at $288K.
Current Project $5.41 million
UOriginal Project $3.43 million
Net change/ask $1.98 million
Less reimbursements/funding ($1.69 million)
Fort Collins General Fund Impact $288K
UNext Steps
City Council approval for the additional appropriation in the amount of $1.98 million, including
the Fort Collins specific funding of $288K, the approval of the associated IGA and exception to
the competitive bid or proposal process for Tritech Software Systems.
ATTACHMENTS
PowerPoint Presentation
Exception to Competitive Bid or Proposal Process
1
Combined Regional Information Sharing Project (CRISP)
Carol Workman
Fort Collins Police Services Loveland Police Department Larimer County Sherriff’s Department
Direction Sought
2
1. Does Council Finance support bringing an additional
appropriation request to City Council for approval?
2. If so, does Council Finance support an additional
appropriation of $1.98M and approval of the associated IGA?
3. Does Council Finance support an exception to the
competitive bid process to purchase the system from TriTech
Software Systems? Low Med High
What is CRISP?
Combined Regional Information Sharing Project
(CRISP)
Computer Aided Dispatch (CAD)
Records Management System (RMS)
Mobile Application
Jail Solution
3
CRISP – Benefits
• Collaboration with partners
• Shared Costs
• Shared Resources
- Field units/manpower
- Technical Staff
• Shared Data
- Crime doesn’t recognize boundaries
- Crime Analysis
• Disaster Recovery
• Business Continuity and
Interoperability
• Situational awareness between
agencies.
• Management of incidents
- High Park Fire
- 2013 Flooding
• Mutual Aid capabilities
• Reduction in call processing
times.
4
Partners and Members
Larimer County Sheriffs Office
Colorado State University PD
Estes Park Police
Estes Valley Fire District
Estes Park Medical Center
Timnath Police
Rocky Mtn National Park
Fort Collins Police Services
Poudre Fire Authority
Wellington Fire
University of Colorado Health
*Loveland Police Department
*Loveland Fire Rescue
*Berthoud Fire Protection
*Thompson Valley Emergency
Medical Services
5
Background
6
• 2015
• Tritech Software Systems purchased current software vendor
(Tiburon)
• 2016
• Tritech informed us the Tiburon software would no longer be
upgraded.
• Tritech offers discount to upgrade to their system.
• Offer 29.39 - CRISP project funded in BFO
• 2016 /2017
• Loveland expresses interest in joining CRISP.
Project Costs
1. Project cost increases from
original request.
2. Drivers of cost increases:
• Added a new partner agency - LPD
• Implementation costs and data
conversion.
• Interfaces - 3rd
party applications
• Hardware and System redundancy
• Network connectivity to Loveland
• Fort Collins specific costs
7
Cost Bridge
8
Change
BFO Approved $3,430,759
Loveland's Additional Costs $1,064,710
CRISP Scope Change $208,952
Net Change in Software Licenses ($327,953)
Interfaces /Custom Solutions $319,573
Implementation Costs $299,312
CRISP PM $124,168
CJIS Compliance Security Infrastructure $100,000
LUMEN and LERMS $70,000
Hardware Costs $22,041
Subtotal of Shared Costs $1,880,803
FC Non-shared Costs $105,000
Total Request $5,416,562
Detailed Cost Changes
9
Total Shared Project Costs Costs as of 12.18.17 Loveland Scope change CRISP Scope change FC/Vendor Scope Misses
Hardware $939,960 $437,320 $29,840 $22,041
CAD Licensing $908,950 $193,000 - ($6,250)
RMS Licensing $737,978 $188,298 - ($34,795)
Mobile Licensing $786,200 $58,400 - ($66,100)
Jail Licenses $153,300 $0 - ($72,910)
Discount - Licensing ($1,294,146) ($589,065) - ($147,898)
Software Licensing [Subtotal] $1,292,282 ($149,367) $0 ($327,953)
Interfaces /Custom Solutions $535,523 $121,100 $94,850 $319,573
CAD Implementation $562,299 $175,762 $28,000 $121,862
RMS Implementation $294,750 $53,200 $25,200 $43,750
Mobile Licensing $86,800 $3,200 $3,600 $21,000
Other Implementation $987,569 $259,332 - $112,700
Implementation [Subtotal] $1,931,418 $491,494 $56,800 $299,312
CRISP Project Manager $186,252 $62,084 - $124,168
CRISP Network (Connecting LPD) $82,080 $82,080 - -
CJIS Compliance Security Infrastructure $100,000 - - $100,000
Other Software and Contigency $244,048 $20,000 $27,462 $70,000
Other Costs [Subtotal] $612,380 $164,164 $27,462 $294,168
Total Shared costs $5,311,562 $1,064,710 $208,952 $607,141
Non-Shared FC Specific Project Costs
Evidence Management Software $50,000 - - $50,000
3rd Party Apps interface [Push] $55,000 - - $55,000
Subtotal [FC Specific Costs] $105,000 $0 $0 $105,000
Total Requested Project Costs $5,416,562 $1,064,710 $208,952 $712,141
Funding for Project [in $1,000’s]
10
BFO Approved Change Current
LETA assistance - $75 $75
LCSO $1,220 $525 $1,746
Loveland $995 $751 $1,746
Fort Collins [Subtotal] $1,215 $635 $1,851
-FC General Fund $1,215 $288 $1,503
-PFA - $174 $174
-UC Health - $166 $166
-Wellington Fire - $7 $7
Total Project $3,431 $1,986 $5,417
Competitive Bid Process
TriTech Software Solutions
• Current vendor for all CRISP members
• Proven success
• Provides required software and functionality for the system
• Cost savings with Tritech (discount and continuity with vendor)
• Partner agencies don’t support a competitive bid process
- Loveland completed a competitive bid process and decided on
TriTech
- Larimer County is not interested in a competitive bid process
11
Next Steps
City Council – TBD
• Appropriation of required funds for project
• IGA approval
• Exception to competitive bid process approval
• Contract signing
Contract signing (projected 2018)
• Anticipated completion 18-24 months
12
Direction Sought
13
1. Does Council Finance support bringing an additional
appropriation request to City Council for approval?
2. If so, does Council Finance support an additional
appropriation of $1.98M and approval of the associated IGA?
3. Does Council Finance support an exception to the
competitive bid process to purchase the system from Tritech
Software Systems?
Low Med High
14
BACK UP
Interfaces/3rd
party applications
15
Court
Interfaces
Evidence
Systems
Accident and
Citations
Sex
Offender
Tracking
911 Data
Content
Management
Fingerprint
System
On line Crime
Reporting
Tritech
Software
Funding
16
BFO Approved Current Change
LCSO $1,220k $1,746k $525k
Loveland $995k $1,746k $751k
Fort Collins $1,215k $1,851k $635k
LETA assistance - $75k $75k
Total $3,431k $5,417k $1,986k
Member Funding
17
Projected funding figures
based on yearly calls for
service percentage and use
of related software, hardware
and services.
Additional FC funding required $635k
New Funding from member agencies
Poudre Fire Authority $174k
University of Colorado Health $166k
Wellington Fire $7k
Subtotal $347k
General Fund Request $288k
Date: February 7, 2018
To: Darin Atteberry, City Manager
Gerry Paul, Director of Purchasing and Risk Management
From: Carol Workman, Acting Information Services Director (Police
Services)
Re: Exception to use of the competitive purchasing process for the purchase of a
public safety software solution from TriTech Software Systems as lead
Purchasing Agent for the Combined Regional Information Sharing Project
(CRISP)
Purchase
Amount: $4.7 million
Bottom-Line:
An exception to use of the competitive bid or proposal process is required to purchase a public
safety software solution from TriTech Software Systems. The City will serve as the lead
Purchasing Agent for the Combined Regional Information Sharing Project (CRISP). This
project will be executed through an Intergovernmental Agreement (IGA) between the City,
Larimer County and Loveland.
Funding for this project will be shared equally between the IGA partners. Funding for the Fort
Collins share of the project will come from the general fund as well as member funding.
Exception to Competitive Bid or Proposal Rationale:
In accordance with Code Section 8-161(d)(3) the City Manager shall submit all exceptions to the
competitive process which exceed a cost of two hundred thousand dollars ($200,000) to the City
Council in an open meeting for final approval.
In compliance with Code Section 8-161(d)(1)(b), although there exists more than one (1)
responsible source, a competitive process cannot reasonably be used or, if used, will result in a
substantially higher cost to the City, will otherwise injure the City’s financial interests or will
substantially impede the City’s administrative functions or the delivery of services to the public.
Background and Justification:
TriTech Software Systems is a leader in the public safety software industry. TriTech offers a suite
of software including; Computer Aided Dispatch (CAD), Records Management (RMS), Mobile
applications and a Jail records. TriTech has been selected to deploy software solutions for some
of the most complex and demanding public safety operations throughout the U.S. and across the
globe. As an experienced public safety solution provider across the country and within the state
of Colorado, TriTech is uniquely positioned to provide the lowest risk, most cost-effective solution
to the CRISP, having already successfully delivered systems meeting Colorado statute codes and
state reporting requirements. The strength of TriTech’s Colorado user base will provide CRISP
with ample opportunities for data sharing.
TriTech is currently the incumbent supplier for each of the CRISP members. Continuing
uninterrupted with TriTech maintains technical continuity, increases probability of success,
keeps costs low (would have to factor in vendor change costs if do not stay with TriTech),
improves quality, and avoids schedule delays to upgrade to the new TriTech platform. TriTech
has also offered a 49% software discount if we move to their software solution.
Staff has extensively evaluated the TriTech system to include detailed demonstrations and
functionality discussions. TriTech provides not only a comprehensive software solution that
supports the needs of the agencies within CRISP, but they also meet the complex and diverse
functional requirements of public safety. Staff had previously received BFO funding (29.39) for
the CRISP replacement with the understanding TriTech would be the software vendor.
In the event the City required a competitive bid or proposal process and identified another
vendor, CRISP would likely lose our newest partner; The City of Loveland. Prior to committing
to CRISP, Loveland had completed a competitive proposal process and selected TriTech.
Loveland has been a CAD customer of TriTech for 20 years and have been pleased with the
quality of the product and service from the vendor. Larimer County has communicated they do
not want to complete a competitive proposal process and have concluded TriTech has the most
effective and reliable solution for their needs.
For years, CRISP has provided a critical infrastructure for many agencies in Larimer County and
is relied upon daily for the operations of its members. The basis of CRISP is to provide Larimer
County agencies a regional system that allows for sharing of data, resources, costs, use and
management of the system. CRISP also allows for management of incidents, disaster recovery
and redundancy which provides for business continuity. Requiring a competitive proposal
process would impact the current CRISP relationships and impact operations of each of our
current member agencies.
Recommendation:
Recommend approval of an exception to the use of the competitive bid or proposal process in
accordance with City Code Sections 8-161(d)(1)(b) and 8-161(d)(3) which authorizes the City
Council to approve exceptions greater than $200,000.
Further recommend use of this approval, as authorization by City Code Section 8-161(d)(4), as
the basis for negotiating the additional purchase of Services from TriTech Software Systems for
up to five (5) years.
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Travis Storin, Accounting Director
Date: February 12, 2018
SUBJECT FOR DISCUSSION Broadband Debt Issuance
EXECUTIVE SUMMARY
The purpose of this item is to clarify Broadband financing requirements based on several
evolving assumptions that have developed since the feasibility financial model was developed in
late 2016. Specifically:
1) The business plan was developed assuming a base case market share of 28.2%. Current
implementation planning target market share is 45% to 50%. Additional market share
requires additional capital to support the increased number of homes that will be
connected to the system. A 50% market share would require connection to roughly an
additional 12,000 premises at approximately $600 per premise.
2) The business plan assumed build out within the Fort Collins City limits and expansion
into the GMA as those areas were annexed into the City. Capital for the newly annexed
areas is not included in the base case financial model. With the recent closure of the
Mulberry enclave, a portion of this area could be annexed during
construction. Additional capital would be needed to support buildout within any newly
annexed Mulberry area.
3) The recent discussions concerning Montava development would also require additional
capital to support build out within this GMA area.
Staff is exploring adding additional capital to provide some capacity to support the expansion of
broadband within these areas. Any added capital would be designated only for use for one of
these events. Assumptions for the cost of building out the network within City limits still
anticipate a $132M requirement.
Staff is seeking guidance from Council Finance to;
1) maintain the current estimate of $132M for debt issuance and resolve additional capital needs
later with a secondary offering as the need materializes or
2) increase the current estimate by $8M-$9M in anticipation of success with the market share
goal, annexation or some combination of the three factors described above.
1
Broadband Debt Issuance
February 12, 2018
Council Finance Committee
2
Feasibility Business Model Assumptions
Basis for $132M Funding
• Market Share 28.2%
• Residential Pricing $50 - $70 mo.
• Commercial Pricing $70 – TBD mo.
• Passing Cost $1,000 pass
• Drop Cost $ 600 premise
• Service within City Limits Only
• Expand to GMA when annexed
Capital Requirements
Capital & Working Capital Requirement Dollars
Network Construction & Installation $ 87
Facility, Vehicles & Fixed Equipment, Back office 12
Fiber Drop, Powering, ONTs 6
Engineering, Design & Inspection 4
Capitalized Interest & Issuance Fees 13
Subtotal $ 122
Working Capital 10
Total Borrowing Requirement $ 132
Business Plan Anticipated Additional Capital Needs
if Share or Service Area Expands
3
Current Considerations
• No Change to Base Assumptions Prior Page
Current Considerations
• Targeting Market Share of 45% to 50%
• Success for each 5% requires additional $2M of capital
• Plus capitalized interest coverage
• Mulberry Annexation – closing the enclave in 2018
• Capital to support annexations may be required sooner
• Montava Annexation – in development
• Capital to support project not included in base estimates
50% market share adds $9M
($8.1M installation + $.9M cap int)
Impact TBD
Target Market Share & New Annexation Potential Increases Capital Requirements
4
Current Thinking
Option A:
• Borrow funds if/when needed based on actual market share and annexation
plans
• If borrow later, may not need capitalized interest – could pay directly from cashflow -
Option B:
• Borrow additional $8M + capitalized interest in anticipation of market share
success and/or annexation requirements
• Capital would be internally restricted to only use for market share success or annexations
• Provides immediate ability to meet capital needs without secondary borrowing
Requires Inclusion in Current Discussion with Underwriter
5
Question for Council Finance
Should Borrowing Amount be Increased to $141M to Include
Success and Annexation Capital Needs?
• Increases
system
renewal
closer to
depreciation
rate
CHANGES:
• Updated
costs
• Updated
costs of
annexations