HomeMy WebLinkAboutAgenda - Mail Packet - 12/18/2018 - Council Finance Committee Agenda - December 17, 2018Finance Administration
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AGENDA
Council Finance & Audit Committee
December 17, 2018
10:00 am - noon
CIC Room - City Hall
Approval of Minutes from the November 19P
th
P Council Finance Committee meeting.
1. Police Training Facility 30 minutes J. Kinsman
G. Yeager
2. Gardens Visitor Center Funding Options 30 minutes M. Provaznik
3. Metro District Policy Updates 30 minutes J. Birks
4. Mall Financial Review & Net Taxable Sales Data 30 minutes J. Birks
J. Poznanovic
Council Finance Committee
Agenda Planning Calendar 2018 - 2019
RVSD 11/29/18 mnb
Dec 17th
Police Training Facility 30 min J. Kinsman
G. Yeager
Gardens Visitor Center Funding Options 30 min M. Provaznik
Metro District Policy Updates 30 min J. Birks
Mall Financial Review & Net Taxable Sales Data 30 min J. Birks
J. Poznanovic
Jan 28th
Child Care Incentive / Fee Waivers 30 min R. Everette
Utility Lab Building Partnership 30 min C. Webb
L. Smith
Feb 25th
Development Review Fee Update 40 min T. Leeson
2018 Rebate Results 20 min J. Poznanovic
Mulberry Metro District Application 30 min J. Birks
Mar 18th
Future Council Finance Committee Topics:
• Revenue Contingency Plan Review
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 Meeting Minutes
11/19/18
10 am - noon
CIC Room - City Hall
Council Attendees: Mayor Wade Troxell, Ross Cunniff, Ken Summers
Staff: Darin Atteberry, Kelly DiMartino, Jeff Mihelich, Mike Beckstead, Kevin Gertig, Travis
Storin, Blaine Dunn, Jennifer Poznanovic, Jason Licon, Tyler Marr, Joe Wimmer, Judy
Schmidt, John Duval, Ryan Malarky, Zach Mozer, Jo Cech, Katie Ricketts, John Phelan,
Sean Carpenter, Carolyn Koontz
Others: Dale Adamy, R1ST.org, Kevin Jones, Chamber of Commerce
____________________________________________________________________________________
Meeting called to order at 10:07 am.
Approval of Minutes from the October 15P
th
P Council Finance Committee Meeting. Ken Summers moved for approval.
Mayor Troxell seconded the motion. Minutes were approved unanimously.
A. Airport Lease Review
Jason Licon, Airport Director
SUBJECT FOR DISCUSSION
Consideration of a land lease agreement between the Cities of Fort Collins, Loveland, and Discovery Air LLC
EXECUTIVE SUMMARY
Staff from the Airport and the Cities have negotiated a fifty-year lease with Discovery Air, LLC for the
development of vacant Airport property. The proposed development will include corporate aircraft hangar
facilities and associated office space, supporting infrastructure, which could also include a new fixed-base
operation and a restaurant. The Lease is contingent on Lessee obtaining certain approvals for proposed
development and financing, and provides the parties with opportunities to terminate the Lease if the proposed
development is not feasible. It is due to the complexity and unique provisions of the Lease, the Commission is
not authorized to approve and sign the Lease; rather, the two Cities must each approve the Lease in accordance
with their respective Municipal Codes and Charters. The Northern Colorado Regional Airport Commission has
reviewed and recommended the lease agreement for approval by the City Councils during their October 18,
2018 meeting with a vote of 7-0 in favor.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
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Staff requests feedback on the proposal as presented. Staff have programmed this item to be considered at the
December 4, 2018 Fort Collins City Council Meeting. This item will also be considered for approval by the City of
Loveland’s City Council on November 20, 2018.
BACKGROUND/DISCUSSION
History
In 1964, the Cities of Fort Collins and Loveland requested that the federal government (FAA) purchase land and
build a public airport, in exchange the Cities agreed to sponsor the operation and maintenance of the facilities.
The Northern Colorado Regional Airport (FNL) is currently one of twelve commercially certified airports in the
state of Colorado, supporting 100,000 aircraft take-off and landing operations annually, has 260 based aircraft,
and serves as the test site for the innovative Remote Air Traffic Control Tower Project. The 2013 economic
impact study conducted by the Colorado Department of Transportation Division of Aeronautics estimates that
FNL contributes approximately $129 million in output annually to the regional economy and supports 826 area
jobs.
Current Policy
The Northern Colorado Regional Airport is a jointly owned and operated public facility shared by the Cities of
Fort Collins and Loveland. In 2015 the Cities entered into an intergovernmental agreement (IGA) that formed
the Northern Colorado Regional Airport Commission, which has delegated certain powers and authority to
operate and maintain the Airport. The IGA provides the Airport Commission authority to enter into Airport
property lease agreements on behalf of the Cities if such agreements are in a form that is generally approved by
the City Manager and City Attorneys from each City. This lease agreement as negotiated is not in the standard
form, therefore requiring approval by each City Council.
The Airport/Cities grant long-term land leases to private sector investors or builders who construct aviation
support facilities. This is a standard process for publicly owned airports and is in accordance with FAA
regulations and grant assurances. The Airport’s current standard lease term for land for the construction of
aircraft hangars is forty years, consisting of an initial twenty-five year lease with three five-year extension
options. At the end of the standard lease term, the lessee has the ability to renegotiate the lease agreement, or
the improvements revert to the ownership of the Cities. The standard lease agreements also typically require
some level of preliminary investment by the Cities for infrastructure to support private sector driven Airport
construction. Pre-development costs include the construction or extensions of access roads, utilities, and
aircraft taxiways. They have historically been funded using local municipal bonding resources or through federal
and state grant funding, combined with local match dollars.
This proposal is considered a public-private partnership, which will be a catalyst for high quality development
and tenants, and will provide the financial resources to enhance the Airport’s future financial sustainability. The
lease is additionally in line with the adopted Northern Colorado Regional Airport Commission strategic plan that
identifies objectives including:
1. Actively encourage private and public investments at the Airport to ensure a strong economic platform
for both on-airport development and complimentary and compatible land use within the surrounding
Airport influence area.
2. A commitment to achieve and maintain a self-sustaining budget to operate a safe and efficient facility,
manage assets, and support industry and economic development.
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Proposal
The proposed lease agreement negotiated with Discovery Air LLC does not qualify as a standard lease that the
Airport Commission can approve. This is due to the key differences with the standard lease format including the
extended term of fifty years, the reduced rate to compensate for the developer’s investment in infrastructure
and the scale of the lease area compared to traditional single hangar building developments, and the potential
for the formation of a metro district. The developer will be assuming all risk and upfront investment for this
project, therefore staff is recommending a lower lease rate and extended lease term than what is standard. The
following are details on the lease terms and rates:
• Lease area: 564,096 square feet (13-14 acres)
• Term: Initial two-year option period that will transition into a fifty (50) year lease
• Annual rate:
o Two year option: $0.05 per square foot
o Years 3-10 after option period: $0.15 per square foot
o Years 11-50 = $0.25 per square foot plus inflation adjustments
• Value of the lease = $4.9 million at 2.5% estimated inflation
o Rates do not change based on project phasing or construction schedule
• Developer will relocate CO Fire Prevention & Control Air Tanker Base
Project Benefits
• No upfront cost to the Cities
• The lease conforms with FAA regulatory standards and grant assurances
• Fuel flowage from larger aircraft, for which this development is designed, could have an additional
positive impact to the Airport’s self-generated income and future financial sustainability
• The area could take 25 years to build out at the current Airport construction rate
• Potential to be a catalyst to attract additional development & businesses
• The project will enhance the Airport’s economic impact & job creation
• Centennial Airport and other successful airports use similar models for large scale aeronautical land
leasing
• Rates are comparable to current larger scale land leases
• Performance measures are included in the Lease agreement
o Must have site development planning and associated approvals completed prior to the end of
the option/entitlement period of 24 months
o Requires horizontal infrastructure started within three years
o Requires vertical infrastructure started within five years
Discussion / Next Steps:
Mayor Troxell; all land is in Loveland - planning and development. The lease agreement is the only piece that we
will be acting on.
Ross Cunniff; sounds good - What is the net impact to airport operations?
Jason Licon; develop it to be specific to a certain type of user - where as if it were a flight school etc. you could
see a significant increase traffic – we are expecting it to be minimal compared to what we have today
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Mayor Troxell; this is an important improvement as viewed by the commission as there is no focus on any
particular business currently. A lot of comparisons were made to the Centennial Airport where there is
corporate air traffic - focus on amenities that would be attractive to corporate clients – this is viewed very
favorably and is very much in line with Strategic Plan.
ACTION ITEM: Ross Cunniff; requested a memo to provide some legal analysis regarding the metro district
component. On the policy side, what would the metro district be used for? Who would be the constituency?
Who would be voting on the metro district? Until they are built the district doesn’t exist.
Jason Licon; metro district as being proposed is basically to fund the infrastructure at this time – since the land is
owned by both cities it would be for improvements only.
John Duval; The metro district would only be approved by Loveland as all of the land is in Loveland.
Jason Licon; the airport is required to comply with FAA regulatory standards - by receiving federal grants to pay
for capital and O&M - this is how the airport has been built since its conception in 1964. A lot of airports use
this same formula for leasing land.
Mike Beckstead; land is jointly owned by the two municipalities - it was given to us by FAA
Judy Schmidt; all development there is ground based.
Mike Beckstead; Police Training facility has a similar ground lease to it for these same reasons - the Police
Training Facility is 44 acres and the FAA has already approved the ground lease from the airport
ACTION ITEM: Ross Cunniff; I am ok with bringing to Council. I would like a memo to include a present value
analysis of the current lease revenue.
Mayor Troxell; I was asked a question about due diligence on Discovery Air - Are they registered in Colorado?
Judy Schmidt; They are registered as a Colorado LLC which appears to be in good standing per the Secretary of
State’s website. There are a variety of other Discovery Air entities with similar names but are not this one.
Mayor Troxell; ok to go forward to Council on December 4P
th
P
B. GERP Review
Blaine Dunn, Sr. Treasury Analyst
SUBJECT FOR DISCUSSION
General Employee Retirement Plan Review
EXECUTIVE SUMMARY
The General Employee Retirement Plan “the Plan” was established in 1971 and was closed to new members in
1999. There are currently 401 total members left in the Plan including active employees, terminated vested
employees, and employees receiving a benefit. In 2017 the total pension liability was $60.0M and the fiduciary
net position for the Plan was $48.8M, leaving a net pension liability of $11.2M.
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GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does Council Finance desire any additional information?
Does Council Finance have any comments on strategy and direction of the Plan?
BACKGROUND/DISCUSSION
The Plan is overseen by the General Employees Retirement Committee (GERC). The GERC is comprised of 6
members, 1 from financial services, 4 current or former employees covered by the Plan, and 1 at large member.
The GERC administers the Plan including setting the investment policy and making any changes to assumptions
used in the actuarial valuations. In 2017 the GERC decided to reduce the assumed rate of return from 6.5% to
6.25%. The 20-year average return for the plan is currently 6.1%.
In 2013 Council approved increasing the supplementary contribution to $1.12M annually. This was to help reach
full funding of the plan sooner than previously projected. It is currently estimated the plan will meet full funding
by 2031. This is when the City supplemental contributions will end.
The current net pension liability of $11.2M is the lowest amount the Plan has had since 2007. The current
funding ratio of 81% is the highest the Plan has had since 2007 and compares favorably with other public sector
plans. The Plan continues to be able to meet all obligations and overall is in a healthy financial status.
Discussion / Next Steps:
Mike Beckstead; We have been reducing our required return on investment percentage. When I got here it was
7.5% and now we are at 6.25% and the unfunded pension liability has gone from $15M to $11.2M. We are 81%
funded at this stage. Liability is down - funding is solid.
Darin Atteberry; Council Finance Committee has had a major role in this over the last 15 years.
Whether they were saying the assumptions seemed too aggressive - liberal -there has been much more
attention on transparency as well the additional monies going into catching up. This is a good news story -
particularly when you look at it compared to other public entities. 2018 - we have inherited a series of very
good decisions including closing the fund in 1999. I wanted to make sure that this committee gets recognized
for that work.
ACTION ITEM: Ross Cunniff Funding Levels by Year slide - city contribution should be on a separate axis so you
can see the change better.
Mayor Troxell; this will play in the AAA bond rating as they look at total assets / liability
Blaine Dunn; one of the things that comes up when we talk with rating agencies is total and net pension liability
- they like to see that we are well funded and in a very good position.
Mayor Troxell; I would like to give a shout out to Council going back to 1999 and closing this out – that allowed
for the future to be brought into a glide path to fulfillment
Ross Cunniff; finite liability - this is a good news story and there is no request to increase the contribution at this
time. Do you think we will want to get down to our 20 year rate of return assumption of 6.1?
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Mike Beckstead; It is a range - depending on how conservative we want to be – ideally, maybe yes.
Ross Cunniff; could push it out another 3 years but I have a gut feeling that the stock market is close to a peak
and that we are going to see a realignment in the next 2-5 years which would impact our average.
ACTION ITEM: The other question isn’t about the GERP but is who is doing this kind of analysis and looking out
for PFA?
Darin Atteberry; I applaud and thank the City Council for not going in that direction with the FOP.
Let me get back with you Ross. If there is a defined benefit program you want to be in - that program is
probably the one. Let me share that with Tom Demint - you will find more and more less reliance on city for
those services and more on PFA (HR, Finance, IT, etc). I understand that you want to be confident.
Ken Summers; FPPA is trying to maintain 115% funded status - would be interesting to see what their projected
returns are going forward. So, the GERC constantly looks at the assumed rate of return over time - anticipating
the next market decline / flattening.
Mayor Troxell; this is a good report - thank you
C. On-Bill Financing V3.0
Sean Carpenter, Lead Specialist Economic Sustainability
SUBJECT FOR DISCUSSION: EPIC Loan Program Update and Next Steps
EXECUTIVE SUMMARY:
This item will provide an update on the EPIC Loan Program, including the history of on-bill financing, current
activities related to the Bloomberg Mayors Challenge and next steps regarding the establishment of a 3P
rd
P party
capital revolving loan fund.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Staff is seeking Council Finance support for issuance of the EPIC 3P
rd
P Party Capital RFP and feedback regarding
other next steps.
BACKGROUND/DISCUSSION
0TFort Collins has ambitious goals for energy efficiency, renewable energy and greenhouse gas emissions
reductions (see 0T31TUEnergy PolicyU0T31T and 0T31TClimate Action Plan0T31T). Meeting these objectives will require customers
undertake comprehensive efficiency improvements, particularly for older less energy efficient rental properties,
owner-occupied homes and small businesses, to drive savings in both electricity and natural gas. An ongoing and
attractive financing structure to support energy efficiency retrofits will be a critical element for success moving
forward.
This section outlines the history of on-bill financing, current activities and proposed next steps.
0TOn-bill Financing 1.0
0TThe Home Efficiency Loan Program (HELP, aka OBF) operated from January 2013 through early 2017. The
program was ended when the outstanding loan balance from Light & Power reserve funds reached the
maximum of $1.6M authorized by Council. The remaining outstanding loan balance from reserves is
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approximately $1M.
0THighlights and results include:
• 0THELP was launched in January 2013, loan activity was slow through mid-2015, after which time it
ramped up significantly (see chart in Exhibit A – HELP Program Activity).
• 0TIn February 2017, when the final OBF1.0 loan was funded, total program loan production was over
$1.75M (see chart in Exhibit A).
• 0TThe median term was 10 years.
• 0TAverage loan amount was $8,900.
• 0TAll loans to date have been for single family homes. Small business customers are also eligible for the
program (based on ownership of the property), but no loans have been completed to date.
• 0TInterest rates have varied 0Tsince the program’s inception0T:
• 2013 – 5.25% to 6.25% based on customer qualifications and loan term
• 2014 – 5.0% or 6.0% based on customer qualifications
• February 2015 to May 2016 – 2.5% for all loans and terms
• June 2016 to October 2016 – 4.0% for all loans and terms
Elevations Credit Union
The City of Fort Collins issued an RFP for energy loan financing and entered a partnership with Elevations Credit
Union in 2017. Elevations offers energy efficiency loans for credit union members with a range of interest rates,
terms and qualifications. The partnership is informal in nature, whereby the Efficiency Works Home program can
provide information to interested customers, who can then engage with Elevations if they are interested.
Uptake of the program has been minimal, with an average of three to five loans issued per month. With the
implementation of EPIC, Elevations loans will continue to be an option for interested customers.
2018 Bloomberg Mayors Challenge
The Bloomberg Philanthropies Mayors Challenge is a yearlong competition that challenged leaders across the
United States to uncover and test bold, inventive ideas to confront the toughest problems faced by cities today
(31Twww.mayorschallenge.bloomberg.org31T ). After successful runs in the United States (2013), Europe (2014), and
Latin America and the Caribbean (2016), the Mayors Challenge returned to the U.S. and was reimagined to
address the urgent need for American mayors to innovate.
The 2018 Mayors Challenge competition invested over $17 million in the more than 320 cities that entered the
competition, via efforts including “idea accelerator workshops”, coaching and testing with the 35 cities that won
the first round of the competition (e.g. “Champion Cities”), and via the grand prize awards made to the Mayors
Challenge winners. The Mayors Challenge is part of the American Cities Initiative, a suite of investments to
strengthen city halls and advance critical policies.
The competition was open to all cities in America with 30,000 or more residents. The “problem” that each team
tried to solve was to be selected by their Mayor or elected City leadership. In the summer of 2017, in response
to the challenge issued by Bloomberg Philanthropies, Fort Collins Mayor Wade Troxell selected the “Climate
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Economy” (e.g. building the foundation for a lower carbon, prosperous future for Fort Collins) as the theme for
the just announced competition.
Staff from Fort Collins Economic Health Office and Utilities Departments began developing a core project team,
in collaboration with other city staff and CSU. In February 2018, we were informed that our proposal won the
first round of the competition and that we were a “Champion City” (35 out of 324 Cities). Fort Collins was
awarded $100,000 to further develop our idea. The final competition was between the 35 Champion Cities, and
last week Fort Collins was selected as one of nine “Grand Champions” and was awarded a $1M prize.
Fort Collins has a lot of rental properties; in fact, approximately 50% of our housing stock in the City is rental
property. Because much of our housing stock is older (CSU was founded when we were still the Colorado
Territory, pre-statehood!), we knew that many housing units could benefit from energy efficiency upgrades.
However, more than just saving energy, we were moved by new research and studies around “social
determinants of health” and the impacts of housing on health and wellbeing. We believed that we could
develop a project that could address “the Climate Economy” via energy efficiency, and in so doing also address
other important “human centered” issues in our Community around indoor air quality, equity and wellbeing,
housing instability and housing affordability.
A partial list of benefits for City residents would include:
• Increased efficiency via more energy efficient housing stock;
• Improved health and wellbeing for all residents; particularly for low- and moderate-income households,
96% of whom are renters in Fort Collins.
• Innovative research. We are working with CSU Engineering Professor Dr. Ellison Carter to help us
research the potential health and wellbeing impacts for residents of these housing upgrades. Dr. Carter
is an expert on indoor air quality and core member of our Bloomberg Mayors Challenge team.
• New jobs and investment in our community for our network of local contractors who are doing the
upgrading work for area home and rental property owners. Suppliers and other partners will also see
increased sales and can be expected to hire new workers, and improved properties will also benefit
home and rental property owners via increased asset values.
• Reduced carbon emissions in support of the City’s Climate Action goals.
Colorado Energy Office
The Colorado Energy Office (CEO) has demonstrated its support of Fort Collins EPIC program with financial
support of a $200,000 grant and $1M low interest loan for the purpose of providing loan capital. As part of the
grant funds, Fort Collins staff will be providing support to the Colorado Energy Office for the development of a
toolkit for on-bill financing which CEO can offer to other Colorado communities.
Through a Memorandum of Understanding (MOU) between the Colorado Energy Office (CEO), Environmental and
Energy Study Institute (EESI), and the City of Fort Collins, Utilities will work with CEO and EESI to develop a scalable
utility on-bill financing program model. The purpose is to promote the expansion of on-bill financing or repayment
programs by utilities across Colorado through the creation of a practical “how-to” resource guide (Guide) for
utilities wishing to launch their own on-bill program. The intent of the Guide is to:
• Build on existing publications and research that highlight industry best practices, case studies, and
lessons learned;
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• Include useful tools and considerations specific to issues that Colorado utilities face in launching this
type of financing program;
• Develop the guide in an iterative process by requesting and incorporating feedback from utilities or
other stakeholders.
It is expected the Guide will be promoted to interested utilities in Colorado initially, but may also be adapted by
EESI for use as a resource to promote on-bill repayment programs across the United States.
EPIC 3P
rd
P Party Capital RFP
The City of Fort Collins is requesting proposals from one or more qualified firms to provide capital in support of
the ongoing EPIC Loan program (aka “On-Bill Financing”). Potential firms include banks, credit unions,
investment funds and foundations. See attachment 1 for the draft scope of work for this RFP.
The EPIC Loan Program is designed to balance the programmatic objectives and financial requirements of the
City of Fort Collins, while also meeting the needs and expectations of capital providers and utilities customers.
The name EPIC comes from an element of the efficiency program, whereby homes receive an Energy
Performance Improvement Certificate. However, for the purposes of implementation, the program is simply
known as the EPIC.
The purpose of this RFP is to seek additional sources of capital to be able to offer a continuing source of funds
(e.g. a revolving loan fund) to meet increasing customer demand for energy efficiency financing. Fort Collins
Utilities will be the borrower and guarantor of the funds from prospective capital providers, and Fort Collins
Utilities will in turn service the repayments to its capital lenders using repayment obligations from customers to
Utilities. In this on-bill financing model, prospective capital providers will not be originating loans to, or
otherwise engaging directly with, Utilities customers. Instead, capital providers will lend or grant funds to the
City, and the City will undertake and / or oversee loan underwriting, origination and collections. Capital
providers will therefore have recourse to the EPIC fund and repayments for funds borrowed, but not to
individual Utilities customers (Figure 1).
Figure 1: Capital and Repayment Structure
39TProposed capital sources for the EPIC Loan program need to align with the following high-level objectives:
• 39TAttractive: The loan program must be able to provide attractive loan terms to customers, specifically
attractive interest rates. 39T
• Scalable: The program must be scalable in support of Fort Collins ambitious energy goals. It is
anticipated that Fort Collins will upgrade thousands of homes in the coming years.
• 39TSimple: the implementation and administration of the program must be as simple as possible for all
parties, including customers, Utilities and the capital partner(s).
Capital
source Utilities Customers
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Potential Size of Loan Portfolio
During the On-Bill Financing Version 1 (OBF1.0) period from July 2015 to February 2017, the rate of loan activity
was equivalent to approximately 120 loans and $1M annually. The scaling of goals associated with the EPIC Loan
program are to complete a minimum of 1,000 projects by the end of 2021. Based on typical project needs, this
would require up to $10M of capital be available. With a range of loan terms from 3 to 20 years, the expectation
for a breakdown of necessary 3P
rd
P party capital amounts and terms would be:
Loan Term Percentage of Portfolio
3-5 years 20%
5-10 years 30%
10-20 years 50%
Potential Financial Solution
Utilities intends to create a sustainable cycle of loans and repayments similar in concept to a revolving loan
fund. There are a range of structures which could be successful, based upon standard financial structures, with
regular P&I and / or balloon payments, to be determined. For example, loan and / or grant capital tied to
Community Reinvestment Act (CRA) obligations for area banks are a potentially viable option for lending capital,
as the EPIC loan program will be targeting older rental properties where many low and moderate-income
households live (e.g. LMI census tracts), among other eligible Utilities customers.
Flexible structures which minimize the need for the City to carry non-deployed debt capital, such as lines of
credit versus term loans, are encouraged. In all cases39T, Fort Collins Utilities would be the borrower, with the 3P
rd
P
party funds being loaned to customers by the City. Fort Collins Utilities would be responsible for the repayment
to the capital provider. In turn, Utilities customers carry the obligation for repayment of loans to the City via
their utility bill. Note: The Utility department has various code-specified tools for recourse of delinquent Utility
bills that makes the risk profile for the EPIC loan portfolio extremely low. Any proposed solution must also
consider all applicable Colorado statutes.
39TFort Collins Utilities recognizes that this proposed financing model is unique for a municipal-owned utility, and
as such we are committed to working with responsive applicants to “co-create” a viable and scalable financing
model that is workable and beneficial for all parties. For the purposes of this RFP, the presumed model will
include:
• 39TCapital to be provided as a line of credit, program related investment (PRI) or other vehicle(s) that
minimize interest carrying costs to the City related to capital access.
• 39TAll program funding, including lending capital and repayments, will be accounted for in a manner under
which the recourse for capital providers will be limited to the loan enterprise fund. This may take the
form of a separate Fort Collins Utilities enterprise fund which will be independent of existing enterprise
funds.
EPIC Loan Implementation
EPIC leverages existing processes delivered through the Efficiency Works Home program, offered to Fort Collins
customers in collaboration with Platte River Power Authority. Financial services are delivered by Energy Smart
Partners after a competitive selection process earlier tis year.
At a high level, the process relating to the efficiency and loan programs is:
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• An efficiency audit or assessment is conducted on the home by the EW- Home advisor/auditor.
• Opportunities for improved health, safety, comfort, and energy efficiency are identified. Costs are
provided for each measure, and savings are estimated in either a package presentation made by the
auditor, or in an audit report generated and sent to the owner by the advisor. In the EW-Home
streamlined path costs and estimated savings are provided by the program advisor. In the standard
path, costs are developed and presented in proposals by the participating contractors.
• An energy audit is also required for the rooftop solar program. The solar system specifications are
submitted to the solar program coordinator for loan approval.
• If desired, the homeowner can choose to pursue an EPIC loan, as follows:
o Customer makes application for a loan to financial services provider
o Loan terms are generally described below in EPIC Loan Characteristics below
o Upon approval, the homeowner and contractor(s) coordinate the timing and completion of the
project
o Upon notification that the project and all inspections are complete, loan funds are disbursed to
contractors (by financial services provider)
o A UCC lien filing is completed with Larimer County for the loan (by financial services provider).
o Closing documents are provided from financial services provider to the Utilities Billing
Department staff to set up the loan in the billing software
o Loan payments are added to the customer’s monthly utility services bill.
Next Steps
• Council will consider an item related to EPIC with a code “clean up” ordinance scheduled for December
4P
th
P. The purpose of this item is to remove conflicting language which defines an interest rate for on-bill
financing loans at a specific value based on a specific date of issuance. Currently, this language restricts
the allowable interest rate to a single value for all loans. The interest rate range definition remains in
code, and specific rates will be set on an ongoing basis, generally annually, in the Financial Officer’s rules
and regulations. The language remaining in code sets the allowable range of interest rates for on-bill
financing at between 2.5% and 10%.
• The Financial Officer’s Rules and Regulations are adopted administratively. The proposed interest rates
starting January 1, 2019 are based on the customer selected loan term as follows:
Loan Term Interest Rate
3 or 5 years 3.49%
7 or 10 years 3.99%
15 or 20 years 4.49%
• Staff continues to seek methods to simplify the EPIC program processes for customers, Utilities and
Energy Smart Partners. The recording of the loans with Larimer County via a UCC filing (aka mechanics
lien) has been identified as a driver of significant complexity and related costs. During the
implementation of OBF 1.0, this recording was deemed necessary to “cloud the title” ensuring that the
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utility loan would show up in a title search. However, preliminary discussion with Utilities billing staff
indicates that this recording is likely not necessary because title processes in nearly all cases include a
check with Utilities regarding outstanding balances for utility bills. Pending further investigation into any
potential risks, staff expects to propose to eliminate this recording to simplify the application process
and reduce loan closing costs.
Discussion / Next Steps:
Mike Beckstead; we wanted to bring the concept through Council Finance today to make sure you are
comfortable with it - our plan is to then issue an RFP and bring in a lender and work through the details of how
the financing would work and then come back to Council Finance with a well-defined program. The
conversation today is intended to be a review of this concept. We moved off of the on-bill financing when we
went with Elevations Credit Union (ECU). The loans go through their origination and payment process. It did
have a significant impact on the loan take rate (friction point) - we think that having the payment on the bill
seems to matter more to customers and it has to be easy particularly for rental property owners.
Sean Carpenter; We were fortunate to be awarded as part of the 2018 Bloomberg Mayor’s Challenge Award.
We wanted to thank the Mayor for his guidance and support. This has been so exciting for the team and we are
grateful. We have done some small-scale EPIC loans – we have done about 20 with 40 or so in pipeline. We
were able to demonstrate to the Bloomberg committee that we were actually launching.
Mayor Troxell; It is a good thing that Bloomberg stays involved - expectations on delivering what was proposed-
the due diligence and follow up- they give value add based on experience with city programs - they are a great
and continuing partner in this.
Sean Carpenter; they are a very active grantor and will be actively involved in our work over the next 3 years – a
great thing. The Colorado Energy office has been interested in on bill financing - A how to manual that could
help other cities replicate what we are doing with the EPIC program and we then could be available to provide
technical support to those cities. We are 50-60% done with the on-bill finance in a box manual. We hope to
finish that in the coming months.
Mayor Troxell; on the transition as well - I hope they will continue - Bill Ritter (former governor) is involved
In the energy transition side -
Mike Beckstead; lots of details we are going to have to sort out - if we borrow for 20 - our cost of capital
is higher than it needs to be - Can we draw on trances? How we come up with the blended interest rate across
different terms of load?
Sean Carpenter; we have a tiered rate - we do not have a income qualified rate - rental properties where low
income folks live - also, longer paybacks / lower payments can make it more attractive to rental property owners
Mike Beckstead; we are anticipating different rates for different terms not by big spreads -
Sean Carpenter; important point is to not make this about the $25 per month this could be saved on their monthly
bill but to focus on improvements on indoor air quality and other health and well-being benefits - the non financial
benefits will be much greater - using air quality sensors to track pre and post air quality
13
ACTION ITEM: Ross Cunniff; what are they tracking for air quality?
Sean Carpenter; mostly particle size- infiltration of diesel and other large particulate. Sean will send a memo with
details.
Mike Beckstead; we came up with some preliminary assumed rates (adding some basis points for admin costs) 3.5
- 4 and 4.5% to get us started - Not sensing a slow down as we did when we had higher rates.
Sean Carpenter; we want to issue the RFP - there may be an opportunity for CRA monies to come into our loan
fund. In a perfect world we want to drive the rates down as low as possible while still maintaining a margin to
cover operating costs - The lending is a means to an end – the end is upgrading 1000s of properties in Fort
Collins.
Ken Summers; adding on the basis point – administrative overhead costs - The target pool of capital does
include the Bloomberg Award, the energy office monies and the private sector funds (TBD). The private partners
make a commitment to the City of Fort Collins of x amount of dollars that are available at some kind of revolving
loan - the Interest rate that we would be charged by the private partner
Mike Beckstead; interest rate we charge and how we calculate that interest rate is something we are going to
figure out with RFP respondents. We would blend those together to get to an average rate and then carve that
down to 5 year and 10-year terms - dice it that way. Ultimately, the interest rate will include our cost of capital
plus a small portion of administrative basis points with the target being 4% plus or minute as when we get north
of 5% and demand falls off historically
Ken Summers; result of the RFP – lender commitment to the city? Immediate load or more of a line of credit?
Mike Beckstead; the RFP will originally gauge interest and will be followed by lots of discussions will lead to
answers to those questions. I don’t visualize a line of credit - the term and rate they loan to us that we then
loan to our customers - that is one thing we will need to keep in line - keep cost of capital appropriate in all of
the various terms.
Sean Carpenter; Funding Partners - working with both the retail customer and the contractor as our agent to
stage the project - they are paying the contractor and then invoicing the City of Fort Collins for reimbursement.
Mike Beckstead; I think the question Ken is asking is how will that work in 3.0? We anticipate in a similar way –
but can’t say specifically until we work out the details
In Version 1.0 - we were lending out our own money
In Version 2.0 - we are currently working with ECU and the loan is between ECU and consumers- we are not
involved
In Version 3.0 - we are on the 3P
rd
P evolution - how do we use other people’s money to drive this kind of
efficiency? We are searching for a mechanism that is desired by consumers and meets their financing
requirements and allows us to drive these energy efficiencies without using our own capital.
Mayor Troxell; this all comes back to the climate economy - we have a $10 challenge and we have $1 - how do
we leverage that? You have done a lot of hard work thinking how to crack a tough nut - how do we upgrade
14
properties in our community? It is not when we are not the thermal energy providers - proving efficiencies -
How to upgrade properties in scale? -It is just not a small marginal token program – this is 40% of our housing
stock we are trying to upgrade - leveraging other people’s money - the other part is this helps to leverage City
Give – donative partners - they are very intentional in outcomes according to what the proposals are - Building
that mechanism through our finance dept. - we talk about revenue diversification and we are doing that -
Looking at it in terms of how we align interests - we can receive revenue through other kinds of mechanism –
more receptor sites for revenue.
ACTION ITEM: Ken Summers; would be interested in seeing a more detailed intermediary final analysis - more of
a detailed flow chart relative to the intermediaries and partners - we need to keep a handle on it – to evaluate
our cost structure in order to keep interest rates down
Mike Beckstead; from an internal control perspective we are spot on with you. Before we did Version 1.0, we have
a 6-7 page financial policy that guides how we do this. We will have that write up of how we envision 3.0 with
details - how we envision this thing working, who is responsible for doing what and where are the risks
Sean Carpenter; I will also commit to making a better quality graphic detailing how the entities interrelate
Ross Cunniff; we are ready for next steps - I appreciate the work - I was concerned with the ECU model for exactly
the reasons we have discussed and am glad to see this moving back to on bill financing - this will make this a bigger
impact project
Mayor Troxell; the letter that came from First National was a supportive letter not a commitment letter
Sean Carpenter; we hope they are one of the respondents.
D. Internet Sales Tax – Work Plan
Jennifer Poznanovic, Project & Revenue Manager
SUBJECT FOR DISCUSSION
Internet Sales Tax Update
EXECUTIVE SUMMARY
Following the Wayfair US Supreme Court decision in June of 2018, Fort Collins wants to better understand the
potential to require remote sellers to collect and remit sales tax in Fort Collins. Starting in December, the state
of Colorado will require remote sellers above the de minimis (same thresholds as South Dakota) to collect and
remit sales tax.
The Colorado Municipal League (CML) Sales Tax Simplification Committee met in October 2018. There was
consensus that it would be highly unlikely that self-colleting municipalities would impose a sales tax filing
obligation on remote sellers without risking a lawsuit or undue burden prohibited by the Wayfair decision.
There was also agreement that the CML and its members should lead the discussion and propose the solution,
rather than let the legislature decide what is best for self-collecting home rule municipalities.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Does Council Finance Committee support collaborative efforts with the Colorado Municipal League?
15
BACKGROUND/DISCUSSION
Wayfair decision June 2018
The Supreme Court held that South Dakota could impose a sales tax filing obligation on any remote seller who
had a substantial nexus with the state, and that a physical presence was no longer necessary. The Supreme
Court upheld South Dakota’s determination that a substantial nexus meant those retailers whose only contact
with the state was annual sales of $100,000, or 200 separate sales transactions of any amount. The Supreme
Court looked favorably on South Dakota’s law for several reasons. South Dakota’s law created a threshold for
sales, protecting smaller sellers. South Dakota is a member of the Streamlined Sales & Use Tax Agreement,
providing online retailers some compliance simplification. Also, the law was not applied retroactively.
Colorado Department of Revenue (DOR) Implementation of Wayfair
Starting this November, remote sellers above the de minimis (same thresholds as South Dakota), are required to
obtain a state sales tax license from the state of Colorado. Collection and remittance of sales tax to the state
begins on December 1, 2018. The state will collect state and local sales tax for any entities it collects in-state
sales tax for. The state of Colorado is responsible for approximately 265 jurisdictions, 150 statutory cities, 24
home rule municipalities and all but two counties.
Self-Collection Home Rule Municipalities and Wayfair
Fort Collins is one of 71 self-collecting home rule municipalities. Home-rule municipalities have autonomy over
their sales tax with their own separate registration, licensing, forms, auditors and tax base. In other words,
home rule municipalities are like separate taxing states within the state of Colorado.
October 23, 2018 at the Colorado Municipal League (CML) Sales Tax Simplification Committee there was
consensus that it would be highly unlikely that self-colleting municipalities would impose a sales tax filing
obligation on remote sellers without risking a lawsuit or undue burden prohibited by the Wayfair decision.
It is possible that a lawsuit filed against one self-collecting municipality could result in an injunction that
effectively extends to all local governments and the state. There was discussion around differences between
South Dakota and Colorado such as Colorado not being part of the Streamlined Sales & Use Tax Agreement
(South Dakota is). Also, Colorado has numerous taxing jurisdictions whereas the Wayfair court addressed only
South Dakota’s state sales and use tax.
The committee discussed other possibilities including a model adopted by Alabama, a uniform rate for remote
sellers. There were concerns regarding unfair taxation and TABOR with this option. Another possibility discussed
was legislation around the Marketplace Fairness Act. More work needs to be done to understand if this could be
a viable option.
There was agreement that the CML and its members should lead the discussion and propose the solution, along
with Colorado DOR, rather than let the legislature decide what is best for self-collecting home rule
municipalities.
Top Internet Retailers Licensed in Fort Collins
Of the top 84 online shopping, B2B and B2C sales on the internet, 15 are licensed in Fort Collins. Of the top 40,
30 percent are licensed. The rank below is in order of 2017 total revenue.
16
*Revenue not reported
Amazon represents 43 percent of online sales according to the National Federation of Retailers. Two of the top
10, Overstock and Fanatics, recently obtained a Fort Collins sales tax license. Of the top 10, Liberty Interactive,
Wayfair, Newegg, Bluestem Group and Eventbrite are not licensed with the City.
E-commerce Sales as percentage of Total Retail Sales in 2017
In 2017, e-commerce sales were 9 percent of the total retail sales in the United States.
Source: Statista 2017
17
The estimate for online sales tax collected in Fort Collins in 2017 is $6M to $7M. Important to note is that this
figure includes brick and mortar business with online sales. Also, the largest online retailers are already licensed
with the City.
Options
1. Proceed without Colorado Municipal League collaboration
2. Collaborate with the Colorado Municipal League
Option 2 – Collaborate with the CML
If the City collaborates with the CML, the next Tax Simplification Committee meeting is scheduled for December
3P
rd
P. The plan is to further discuss options with a goal to get to a uniform agreement in 2019. The CML is planning
to post on their Legislative Matters blog reasons for self-collecting municipalities to be patient and move
together uniformly. In the meantime, large online retailers may continue to get licensed - this summer two of
the top 10 online retailers obtained a Fort Collins sales tax license.
Discussion / Next Steps:
Fort Collins is one of 71 self-collecting home rule municipalities
Mike Beckstead; total $6-7M in internet sales tax revenue – that is total and not all new revenue– we are already
collecting a portion of that with our current agreements. The estimate of new revenue could be in the $4M plus
or minus range based on our current work - that might change over time as we dig deeper into this.
Ryan Malarky from the City Attorney’s office: expressed some caution about making sure we get good analysis of
any approach we might take - unique circumstances here in Colorado due to so many home rule municipalities
and jurisdictions and what impact that might have when compared to the South Dakota system.
Ross Cunniff; what are the downsides of collaboration? We are going to continue to license large retailers as we
have been.
Mike Beckstead; I think the only potential risk is time - if we were doing this on our own we could control the
accelerator petal as opposed to doing it with 71 other communities. The risk if we go it alone and bump into
something that could add to the time so I do believe that collaborating with CML may be the appropriate way to
go,
Ross Cunniff; I support the collaboration with CML -Would be interesting to know what other contingencies - If
some other large community decides to go it alone – what would we then do?
Ken Summers; I think we need to collaborate - we are in a good place as we have large retailers that are
voluntarily getting a sales tax license - we should stay with that and not push it . Look at the South Dakota
model compared to what is here in Colorado - too much to deal with all the different entities, one on one
systems in place - jumping on board - Risk of doing it alone - a possible lawsuit that would put a stop to it
Mayor Troxell; stay the course - as it relates to CML we appreciate the involvement but also that is headed
Legislative session – we need to be on top of this as it plays out (Tyler) work with our Council to may sure they
know where we are at and where we are going
18
Mike Beckstead; we will bring this back to Council Finance every few months with updates as things mature.
E. Financial Management Policy Review
Travis Storin, Accounting Director
SUBJECT FOR DISCUSSION: 2018 Financial Policy Review
EXECUTIVE SUMMARY: Once a year a portion of Financial Policies are reviewed and updated is needed. Staff is
committed to reviewing each policy no less than every 3 years. With Metro Districts having already been
reviewed and adopted by Council in August 2018 and with the formation of the URA Finance Committee, the
only policy up for review is #9 Economic Development. At the request of Council, staff will be making
substantial modifications to this intends to work through this process in 2019.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does Council wish to bring any specific policy or policies forward sooner than currently scheduled?
BACKGROUND/DISCUSSION
The current catalog and review schedule for all Council-adopted financial management policies is displayed
below. With the deferral of Economic Development to 2019, there are no additional policies up for review.
Further, staff is not recommending an early review or change of the remaining policies reviewed in 2016 or
2017.
# Policy Last Modified Last Reviewed Next Reviewed
1 Budget 2017 2017 2020
2 Revenue 2016 2016 2019
3 General 2017 2017 2020
4 Not used
5 Reserves (Fund Balance) 2017 2017 2020
6 Not used
7 Debt 2013 2016 2019
8 Investments 2012 2017 2020
9 Economic Development 2015 2015
Up for review; Industry Cluster
Funding to be revised
substantially in 2019
10 Metro District 2008 2017 Adopted 8/21/2018
20 URA - TIF Assistance 2014 2014
Will incorporate input from
URA Committee & Board in
2019
Discussion / Next Steps:
Policy modifications for #9 will be brought forward in Q3 of 2019 (industry cluster modifications)
19
Ross Cunniff; looks good to me
Mayor Troxell; I am interested in the Economic Development policy (#9). Not sure where they are going with
industry clusters - it is up for review
Ken Summers; I am good
Mike Beckstead; ideally we would have brought this forward in 2018 but as we talked in budget – industry
clusters are talked about in that policy so until we had conversation about cluster funding we couldn’t bring it
forward. This is really about our commitment to bring these forward to Council Finance for review every 3
years.
Other Business:
Check and Deposits; Mike Beckstead; In spirit of transparency, we had a situation which involved an operator
key punch error on a travel reimbursement payment to Councilman Ken Summers. This error was caught by Ken
and funds were returned to the city within 24 hours. We have about 70k A/P transactions processed annually in
Finance - 85% of transactions have multiple controls and sets of eyes looking at them and 15% are done
manually and keyed individually - control in place on these transactions is for the operator to pause and
compare what is on the screen with what was on the paper. We have implemented new controls going forward
to include any transaction in the 15% manual population and over $1K will be reviewed directly by a senior
member of the staff. Also, as we move into P2P Phase 2 there are other improvements we plan to implement.
We are laser focused on this - lesson learned - a series of process improvements. Vendor and contractor
payments are in the 85% - Employee reimbursements, utility refunds and rebate payments are currently in the
15%.
Council Pay Initiative; Ross Cunniff; In the event that signatures are sufficient and the initiative passes. Think we
had a memo regarding the financial impact - can we get that redistributed in advance of the budget meeting?
Darin Atteberry; Would be at least $600-700K per year of on-going. If it does ultimately get approved - we will
have to respond in short order. The deadline for signature counting and verification is the 27P
th
P followed by a 15
day cure period - Delynn has some thoughts about how the numbers are coming in. We will need to add this as a
topic for Council Finance if signatures are sufficient and verified.
ACTION: Mike Beckstead will resurrect memo and send it to Council before Budget meeting tomorrow evening
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Greg Yeager, Deputy Chief
Jerrod Kinsman, Lieutenant
Brian Hergott Sr., Facilities Project Manager
Erik Martin, Financial Analyst II
Date: December 17P
th
P, 2018
SUBJECT FOR DISCUSSION: Police Regional Training Facility IGA and Funding
EXECUTIVE SUMMARY: The Police Regional Training Facility (PRTF) has been under
design and the staff from the Cities of Fort Collins and Loveland have developed a draft
IGA that addresses the construction, operation, and maintenance of the facility. There
have been a few changes in design since the March 2017 Joint Council presentation,
and staff would like to brief Council on those changes and the progress while seeking
direction for next steps.
BACKGROUND/DISCUSSION: In 2014, Fort Collins and Loveland held a Joint Council
session to discuss the possibility of a police training facility that would be shared
between the two agencies and as a regional resource for our neighbors. In 2015,
Loveland City Council’s split vote (4-4) put the project temporary on hold.
In 2017, the Councils jointly approved for design work to begin on the facility. Staff at
the two cities have been working with the design firm SEH to design a facility that meets
the scope, budget, and building requirements for both organizations. Based on updated
requirements from the Northern Colorado Regional Airport and surveys of the land,
adjustments have been made to the design to stay within the project budget and to stay
within the scoped needs of both agencies.
Summary of Changes from Previous
• One rifle range and one pistol ranges of reduced to one tactical range
• Three classrooms reduced to two classrooms
• Smaller skid pad and less complex driving track
In 2018, staff from the two cities have been working to create an IGA to govern the
construction, operations, and maintenance of the facility that meets the requirements of
both cities. Staff has a draft copy ready for consideration by both councils.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
• Does Council support continued collaboration with Loveland on the PRTF
through an IGA?
• Does Council wish to fund construction for the facility using debt service?
ATTACHMENTS
• Presentation Slides;
• Draft IGA
2
Agenda
• History & Need for Training
• Facility Cost & Features
• Partnership Assumptions
• Financials
• Staff Recommendation
3
Project History
2014
• April - Loveland/Fort Collins Joint City Council Meeting.
• August - Regional Training Campus Strategic Business Plan.
• September - Loveland City Council Study Session, Larimer County declines Partnership
2015
• February - Joint Study Session
• November - Fort Collins City Council unanimously approves and appropriated design cost
• December - Loveland City Count split vote (4-4)-project on hold
2017
• January/February – Loveland City Council Worksessions
• March – Received Joint Council Approval to start design
• December Selected SEH as the Architect
2018
• December - Construction and Operation IGA completed
• December - RFQ for Construction firms completed
4
Need for Training / Current Facilities
Fort Collins
Equipment & Facilities:
• Building – Excellent
• Equipment – Excellent
• Training – Barely adequate
• Rifle training @ Great Guns - 50 mile round trip
• Driving training in Adams county - no capacity
Training is Critical:
• Provide World Class Service to our Citizens
• Maintain professional level of Police Officers
• Training best practices for police profession –
Response to current climate
• Reduces liability issues – Failure to Train
• Increases safety to citizens and officers
• Required by POST
Loveland
Equipment & Facilities:
• Track - 3 acre lot Loveland Fire Rescue (35 mph)
• Adams County track has no capacity
• Outdoor range limited to 50 yards, no storage
• Pistol training done at Front Range Gun Club
Training is Critical:
• Two recent Tactical Vehicle Interventions (TVI) in
November and December of 2016.
• Two LPD officer involved shootings in the last
three years. One fatal officer involved shooting in
Fort Collins in 2016 (LPD Investigation).
• Continuous and smart use of force decision
making by officers on a daily basis.
• LPD officer involved crashes: 2016-20 traffic
crashes. Strong goal to reduce crashes & risk.
5
Benefits of Joint Training Facility
• Ensure a highly trained, efficient World Class Operation
• Develop a center that allows for current and future growth
• Productivity improvements – reduced travel, callout/call back benefits
• Singular location to drive and shoot simultaneously
• Ability to train together with multiple jurisdictions (many high profile
incidents are multi-jurisdictional)
• Provide numerous law enforcement, fire, government, private entities a
venue for training
• Fulfill Colorado POST Training Requirements
6
Partnership Assumptions
• Facility is jointly owned and operated and costs split 50/50
• Loveland will lead on contracts – Fort Collins reimburses
• First IGA focus on design
• Second IGA will focus on construction, operation and
maintenance
• Operations issues resolved before construction bid process
7
Construction & Operations IGA
• IGA governs construction & facility operations and maintenance after completion
• Loveland is lead on construction – contracting & project management
• LEED certification & Zero Energy for class rooms and office space
• Exhibit A defines minimum scope and not to exceed cost of $18.5
• Grants will be pursued to enhance track and skid pad above base design
• Facility Management - Shared operational decision authority by both Chiefs
• Chiefs develop annual Operational Plan & budget – feeds each City’s budget process
• O&M cost net of rental revenue and prior year underspend shared 50/50
• Loveland provides Administrative Services support for a fee– finance, hr, facilities, legal, etc.
• Capital Renewal of $60k per year included in budget – non-lapsing and builds over time
• Open Items – FC payments to Loveland, zero energy, equal usage
• Land Utilization IGA between Loveland and Fort Collins address land lease commitments
8
New Facility Features
$18.5M facility includes:
• 50 yard, 21 lane indoor Pistol Range
• 6,000 sqft. Admin space including;
• 2 classrooms
• Office Space
• Driving Skid Pad
• 1.4 mile Driving pursuit/speed track
• Room to add on/grow in future:
• Street Grid & Tactical Village
• 100 yard range
• Shoot house
• EVOC Maint. Facility & Fuel
Station
• AVT and Off road driving course
9
Change in Scope
3/12/2017
$18.5M concept Facility
Includes:
• 50 yard, 20 lane indoor Pistol Range
• 100 yard, 10 lane indoor Rifle Range
• 3 Classrooms
• Office Space
• Driving Skid Pad/Skills Pad
• 1.4 Mile Driving Pursuit/Speed Track
• Room to Add on/grow in future
12/07/2018
$18.5M concept facility
includes:
• 50 yard, 21 lane indoor Pistol Range
• 2 Classrooms
• Office Space
• Driving Skid Pad/Skills Pad
• 1.4 Mile Driving Pursuit/Speed Track
• Room to Add on/grow in future
10
Timeline
Proposed Timeline
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
Design & Architecture
Site Work Construction
Track Construction
Range & Classroom Construction
Facility Operational
2017 2018 2019 2020 2021 2022
11
Campus Capacity
Segment Assumptions
• Increased segment availability
• 4 segments of 4 hours/day
• 7 days/week
• 48 weeks/year
• 80% availability
• Majority of excess capacity
due to track and skid pad
11
Total Segments 2021 2022 2023 2024 2025
Track 1,075 1,075 1,075 1,075 1,075
Skid Pad 1,075 1,075 1,075 1,075 1,075
Ranges (1) 1,075 1,075 1,075 1,075 1,075
Classroom (2) 2,150 2,150 2,150 2,150 2,150
Total Segments 5,376 5,376 5,376 5,376 5,376
Segments Consumed by FC/Loveland
Track 89 92 94 97 99
Skid Pad 89 92 94 97 99
Ranges (1) 369 373 377 381 386
Classroom (2) 621 630 639 648 658
Total Segments 1,168 1,186 1,204 1,222 1,242
Percentage of Segments Used In-house
Track 8% 9% 9% 9% 9%
Skid Pad 8% 9% 9% 9% 9%
Ranges (1) 34% 35% 35% 35% 36%
Classroom (2) 29% 29% 30% 30% 31%
Total Segments 22% 22% 22% 23% 23%
12
Facility Revenue & Cost
Facility Cost
Assumptions
• Rental Revenue based on
avg. $325/segment
• No FRCC Academy revenue
• 2 Dedicated FTEs
• Loveland provides
administrative support
• Capital Renewal for Future
maintenance
• Before savings, additional
$200k of O&M per city
12
Training Facility Operating Costs ($ 000's)
2020 2021 2022 2023 2024
Revenue
Class Charge to Outside User $ - $ 24 $ 49 $ 50 $ 52
Rental Revenue - 54 111 114 118
Total Revenue $ - $ 78 $ 160 $ 165 $ 170
Expenses
Personnel 29 151 155 160 165
Admin/Classroom - 35 36 37 38
Shooting Range - 135 139 143 147
Driving Track/ Pad and Parking lot - - 50 50 50
Insurance /Admin Charge/WFO - 97 116 120 123
Capital Renewal - 61 63 65 66
Total Expense $ 29 $ 479 $ 560 $ 575 $ 591
Training Facility Income/(Loss) $ (29) $ (401) $ (400) $ (410) $ (421)
13
City Savings
**Revenue from sale of
Midpoint Drive range not
included in assumptions
(only O&M)
FCPS is developing a
business plan for an
in-house police
academy that will
request retention of the
existing range.
2021 2022 2023 2024 2025
Vehicle Travel Expense $10 $10 $10 $10 $10
Front Range Gun Club Rental $49 $49 $50 $50 $50
Track Rental $8 $8 $8 $8 $8
Total Loveland Hard Savings $67 $67 $69 $69 $69
Loveland Soft Savings $20 $21 $21 $21 $21
2021 2022 2023 2024 2025
Ft. Collins Rental Space $6 $6 $6 $6 $6
Ft. Collins Vehicle/Travel Exp. $11 $11 $12 $12 $12
Ft. Collins Driving $2 $2 $2 $2 $2
Mid Point Dr. Firing Range Savings** - $68 $70 $72 $74
Total FC Hard Savings $19 $87 $90 $92 $95
FC Soft Savings $13 $13 $14 $14 $15
Loveland Savings ($000's)
Fort Collins Savings ($000's)
14
Training Facility Budget Impacts – Fort Collins
Training Facility Budget Impact ($ 000's) Fort Collins
2020 2021 2022 2023 2024
Training Facility Income/(Loss) $ (29) $ (401) $ (398) $ (409) $ (419)
50% Share - Loveland $ (14) $ (201) $ (199) $ (204) $ (210)
50% Share - Fort Collins $ (14) $ (201) $ (199) $ (204) $ (210)
Fort Collins Police Savings 19 87 90 92
Total Fort Collins Police Impact $ (14) $ (182) $ (112) $ (115) $ (117)
15
Debt Structure
Assumed Conditions
• 20 year, fixed rate semiannual payments
• 5.00% Interest Rate
15
January 15th
COP Ordinance first reading
February 5th
COP Ordinance second reading
February 25th
Marketing and Pricing of COPs
March 6th
Closing and delivery of proceeds
End of March
Payment to Loveland – subject to IGA
Project Amounts
Police Training Facility $8.3M
I-25 Project $17M
Issue Costs* $0.3M
Total Debt Issuance $25.6M
Yearly Debt Service
I-25 Project $1.4M
Police Training Facility $662k
Total Yearly Debt Service $2.04M
*Estimate subject to change
16
Council - Direction
1. Does Council support continued collaboration with Loveland on the
PRTF through an IGA?
2. Does Council wish to fund construction for the facility using debt
service?
17
Thank You!
18
Back-Up
19
Back up - Project Team
Fort Collins
• Chief Jeff Swoboda
• Deputy Chief Greg Yeager
• CFO Mike Beckstead
• Lt. Jerrod Kinsman
• PM Brian Hergott
• Police Financial Analyst Erik Martin
Loveland
• Chief Robert L. Ticer
• Facilities Manager Michael Hogan
• Lt. Jeff Pyle, LPD
• Budget Manager Theresa Wilson
• Budget Analyst Matthew Elliot
20
Back up Expanded Timeline
Proposed Timeline
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
Design & Architecture
Site Work Construction
Track Construction
Hiring of the Campus Manager
Range & Classroom Construction
Admin support/Maintenance Tech
Admin Charge/Insurance Start
Rent from Outside Agencies
Extra seats for classes sold
Shut Down of Mid-Point Drive Range
2017 2018 2019 2020 2021 2022
21
Back up - Capital Cost History
Capital project scope
adjustments since 2014
• Original partnership project model
included two pistol ranges – $23M
• Reduced to one pistol range with
track, SWAT, street grid, etc. – $18.5M
• Reduced pistol range size; removed
street grid, SWAT, track, skid pad
remain – $18.5M
• Removed rifle range as costs for soil
development costs increased $18.5M
Proposed Cost Detail Feb 2015 Mar 2017 Dec 2018 vs. 2017
($ 000's) Original Presented Current
Design & Architecture $ 1,460 $ 1,261 $ 1,615
Bid & Construction Support 416 359 $ 730
Firing Ranges & Support 9,549 7,290 5,738
Classrooms & Admin & Bldg Support 4,372 1,331 inc. above
Grossing Factor inc. above 2,316 $ 1,067
Inflation 1,122 1,001 $ 531
Contingency inc. above 1,051 $ 664
Total Range Building $ 16,919 $ 14,609 $ 10,345 $ (4,264)
Total Sim/SWAT House 997 Removed Removed $ -
Driving Track & Skid Pad 1,925 1,411 $ 2,966
Outbuilding 727 72 Removed
Track Contingency 396 211 -
Total Track & Skid Pad $ 3,048 $ 1,694 $ 2,966 $ 1,272
Site Improvements 2,154 1,927 $ 4,946
Site Contingency 321 289 $ 262
Total Site Improvements $ 2,475 $ 2,216 $ 5,208 $ 2,992
Total Project Cost $ 23,439 $ 18,519 $ 18,519 -
22
Back up Cost Share
Total Project Costs $18,518,782
Fort Collins Share $9,259,391 50%
Loveland Share $9,259,391 50%
Total $18,518,782 100%
Fort Collins Share $9,259,391
2017 Design Payment $687,417
Future Project payments $8,571,974
23
March 2017 - Facility Features and Capital Cost
$18.5M concept facility
includes:
• 50 yard, 20 lane indoor Pistol Range
• 100 yard, 10 lane indoor Rifle Range
• 3 classrooms
• Office Space
• Driving Skid Pad
• 1.4 mile Driving pursuit/speed track
• Room to add on/grow in future
24
Back up- Op Ex Costs
• Campus Manager is a
civilian employee
• Admin Support Personnel
to support
revenue/booking
• 0.50 FTE worth of WFO
support for building
December 2018 Update Sq Ft. Cost Year 1 Total Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Staff Expense 2020 2021 2022 2023 2024 2025
Full Time Campus Manager (1 FTE) $115,000 $28,750 $118,450 $122,004 $125,664 $129,434 $137,316
Administration Support (1 FTE) 65,000 - 32,500 33,475 34,479 35,514 37,676
Total Staff Expense $180,000 $28,750 $150,950 $155,479 $160,143 $164,947 $174,992
Main Building - Admin/Classrooms/Support
Custodial 6,000 $ 1.25 7,500 - 7,725 7,957 8,195 8,441 8,955
Maintenance and Repair 6,000 $ 1.95 11,700 - 12,051 12,413 12,785 13,168 13,970
Utilities 6,000 $ 1.75 10,500 - 10,815 11,139 11,474 11,818 12,538
Operational Supplies 6,000 4,500 - 4,635 4,774 4,917 5,065 5,373
Total Main Building Expense 34,200 - 35,226 36,283 37,371 38,492 40,837
Pistol and Rifle Range - 21 Pistol
Custodial 23,529 $ 1.25 29,411 - 30,294 31,202 32,138 33,103 35,119
Maintenance and Repair 23,529 $ 2.00 47,058 - 48,470 49,924 51,422 52,964 56,190
Utilities 23,529 $ 2.00 47,058 - 48,470 49,924 51,422 52,964 56,190
Operational Supplies 23,529 7,500 - 7,725 7,957 8,195 8,441 8,955
Total Range Expense 131,027 - 134,958 139,007 143,177 147,472 156,453
Driving Track
Maintenance and Repair - - - 50,000 50,000 50,000 50,000
Total Track Expense - - 50,000 50,000 50,000 50,000
Other Expenses
Capital Renewal 29,529 $ 2.00 59,058 - 60,830 62,655 64,534 66,470 70,518
Capital Renewal 60,830 62,655 64,534 66,470 70,518
Insurance 22,000 22,660 23,340 24,040 24,761
Insurance 22,000 22,660 23,340 24,040 24,761
Work for Others Facility Support 30,800 - 15,400 31,724 32,676 33,656 35,706
Admin Charge 60,000 60,000 61,800 63,654 65,564 67,531
Admin Charge & WFO 75,400 93,524 96,330 99,220 103,236
Total Annual O&M Expenses $ 28,750 $ 479,364 $ 559,607 $ 574,895 $ 590,642 $ 620,798
Annual Operations and Maintenance Costs
25
Back up - Segment Rental Assumptions
25
Total Segments 2021 2022 2023 2024 2025
Track 1,075 1,075 1,075 1,075 1,075
Skid Pad 1,075 1,075 1,075 1,075 1,075
Ranges (1) 1,075 1,075 1,075 1,075 1,075
Classroom (2) 2,150 2,150 2,150 2,150 2,150
Total Segments 5,376 5,376 5,376 5,376 5,376
Segments Consumed by FC/Loveland
Track 89 92 94 97 99
Skid Pad 89 92 94 97 99
Ranges (1) 369 373 377 381 386
Classroom (2) 621 630 639 648 658
Total Segments 1,168 1,186 1,204 1,222 1,242
Segments Rented Out
Track 26 52 53 53 54
Skid Pad 30 61 62 63 63
Ranges (1) 27 54 55 55 56
Classroom (2) 83 168 169 171 173
Total Segments 166 335 339 342 345
Percentage of Segments Used
Track 11% 13% 14% 14% 14%
Skid Pad 11% 14% 15% 15% 15%
Ranges (1) 37% 40% 40% 41% 41%
Classroom (2) 33% 37% 38% 38% 39%
Total Segments 25% 28% 29% 29% 30%
26
Back up - Extra Seats to be Sold
Dec 2018 assumptions
Class Name Sessions/Year Extra seats per Annual Students Charge/StudenRevenue Use in Model
Accident Investigation 2 4 8 $ 150 $ 1,200 $ 1,200
Active Shooter Course 2 4 8 $ 200 $ 1,600 $ 1,600
Building Searches 0 4 0 $ 125 $ - Not offered
Crime Scene Investigation 5 4 20 $ 150 $ 3,000 $ 3,000
Criminal Investigations 8 4 32 $ 200 $ 6,400 $ 6,400
Defensive Tactics 0 4 0 $ 150 $ - Not offered
Drill Tower Rappelling 0 4 0 $ 250 $ - Not offered
Driving - Low Speed Road Course (20 mph ma.) 10 4 40 $ 150 $ 6,000 $ 6,000
Driving - Skid Pad (Skid Recovery Pad) 10 4 40 $ 150 $ 6,000 $ 6,000
Driving - Skills Pad - (Backing, Serpentine Maneuvering) 10 4 40 $ 150 $ 6,000 $ 6,000
Firearm Instructor School 2 4 8 $ 500 $ 4,000 $ 4,000
First Aid/CPR 3 4 12 $ 50 $ 600 $ 600
Force Options Shooting 2 4 8 $ 150 $ 1,200 $ 1,200
Incident Command System 3 4 12 $ 150 $ 1,800 $ 1,800
Internal Affairs Investigations 1 4 4 $ 250 $ 1,000 $ 1,000
Interview/Interrogation 6 4 24 $ 200 $ 4,800 $ 4,800
Leadership School 3 4 12 $ 150 $ 1,800 $ 1,800
Less Lethal/Taser 0 4 0 $ 150 $ - Not offered
Mobile Field Force/Riot Control 3 4 12 $ 150 $ 1,800 $ 1,800
Officer Survival 4 4 16 $ 100 $ 1,600 $ 1,600
Range - Officers - Pistol 0 4 0 $ 50 $ - Not offered
Range - Officers - Rifle 0 4 0 $ 50 $ - Not offered
Range - Tactical Team - Pistol 0 4 0 $ 100 $ - Not offered
Range - Tactical Team - Rifle 0 4 0 $ 100 $ - Not offered
Simulated City for Street Training Exercises 0 4 0 $ 100 $ - Not offered
Simunitions Scenario House 0 4 0 $ 150 $ - Not offered
Misc Classes TBA
Total $ 48,800.00
27
Back up Budget Impacts - Loveland
*Note: lease for airport land not included, offsets current city contribution
Training Facility Budget Impact ($ 000's)
2019 2020 2021 2022 2023 2024 2025
Design
Construction (assuming Cash) $ 4,286 $ 4,286
Loveland Share of Loss (14) (201) (200) (205) (211) (222)
Loveland Savings 67 67 69 69 69 69
Budget Impact -Loveland $ 4,286 $ 4,339 $ (134) $ (131) $ (136) $ (142) $ (153)
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
1
INTERGOVERNMENTAL AGREEMENT
FOR THE CONSTRUCTION, OWNERSHIP, OPERATION, MAINTENANCE, AND
MANAGEMENT OF THE REGIONAL TRAINING CAMPUS
THIS INTERGOVERNMENTAL AGREEMENT FOR THE CONSTRUCTION,
OWNERSHIP, OPERATION, MAINTENANCE, AND MANAGEMENT OF THE REGIONAL
TRAINING CAMPUS (the “Agreement”) is made and entered into this ____ day of
______________, 2018, between THE CITY OF LOVELAND, COLORADO, a municipal
corporation, hereafter “Loveland,” and THE CITY OF FORT COLLINS, COLORADO, a municipal
corporation, hereafter “Fort Collins,” and hereinafter each referred to as a “City” and collectively
referred to as "Cities".
W I T N E S S E T H:
WHEREAS, the Cities are each home-rule municipalities that maintain police departments
to provide law enforcement services to their respective citizens and employ police employees who
participate in ongoing training regarding projectile weapons and vehicle use in order to maintain and
improve the skills necessary to perform police functions; and
WHEREAS, currently each of the Cities’ police employees conduct projectile weapons
training and vehicle/driver training separately and combining such training at one facility will
create cost efficiencies for both police departments; and
WHEREAS, Loveland considers it a priority to effectively operate a public safety training
campus that will better meet the needs of the Loveland Police Department and the northern
Colorado community as a whole; and
WHEREAS, Fort Collins agrees that a centralized public safety training campus for use
by law enforcement agencies serving the northern Colorado community would benefit the citizens
of Fort Collins and, therefore desires to partner with Loveland in the construction and
administration of a public safety training campus; and
WHEREAS, it is the Cities’ intent that the public safety training campus would serve as a
regional training facility for several other governmental agencies in and around Colorado’s
Northern Front Range, including the Larimer County Sheriff, the Weld County Sheriff, the Greeley
Police Department, the Windsor Police Department, the Colorado State University Police
Department, and others; and
WHEREAS, the Cities jointly-own real property on which the Cities operate the Northern
Colorado Regional Airport. The Cities intend to utilize an available portion of such real property
for the construction and eventual operation of a police regional training campus; and
WHEREAS, pursuant to Section 29-1-203 of the Colorado Revised Statutes, the Cities are
authorized by law to contract with one another to provide for the joint exercise of any function, service
or facility lawfully authorized to each of the Cities if such contracts are approved by their governing
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
2
bodies; and
WHEREAS, on October 23, 2017, the Cities executed an Intergovernmental Agreement For
The Sharing Of The Cost Of The Preliminary Design, Design Development, Construction Drawings,
And Construction Administration Relating To The Construction Of A Regional Training Campus,
which established the preliminary cost, design, and planning requirements of the Cities (the “Initial
IGA”); and
WHEREAS, the Cities’ intent of this Agreement is that the training campus will be owned,
designed, constructed, operated, maintained, and managed equally by the Cities, with other
agencies paying the Cities for their use of the facilities; and
WHEREAS, since the execution of the Initial IGA, the Cities have worked collaboratively
together and are in the final stages of completing the design and development components outlined
in the Initial IGA; and
WHEREAS, the Cities desire that the training campus be constructed utilizing the
Construction Manager at Risk (“CMAR”) delivery method which entails a commitment by a
Construction Manager, as designated by the Cities, to complete construction of the campus within a
guaranteed maximum price and a firm completion date; and
WHEREAS, the Cities seek, by this Agreement, to memorialize the terms on which they
have agreed, in a collaborative manner, to engage in the operation, maintenance, and management of
the campus, with the intent that their collaborative undertaking shall continue for many years to come
and include subsequent amendments to this Agreement and the adoption on an Operation Plan
approved by each City’s Chief of Police or his or her designee.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS, IT
IS AGREED by and between the parties hereto as follows:
1. Mutual Undertaking. The Cities agree that the construction, ownership, operation,
maintenance, and management of the regional training campus ("Training Campus")
will be a mutual undertaking between the Cities, with each City equally sharing in the
authority and obligations associated with or arising from construction, ownership,
operation, maintenance and management of the Training Campus, unless specifically
stated otherwise in this Agreement.
2. Training Campus Real Property Agreement. The Cities agree that it shall be their joint
responsibility to negotiate and execute an agreement for the use of the real property
underlying the Training Campus consistent with the scope and purpose of this
Agreement, and said use agreement shall be approved by the Cities’ respective
governing bodies.
3. Construction of the Training Campus. Loveland shall engage a vendor through a
competitive sealed proposal process to construct the Training Campus, utilizing the
Construction Manager at Risk (“CMAR”) delivery method, subject to the approval of
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REVIEW AND REVISION
3
Fort Collins. Fort Collins shall participate equally in the vendor selection process. The
Cities agree that the Training Campus shall, at a minimum, contain a driving track, a
firearms range, a skills pad, and adequate classroom space as detailed in the design
document dated ___, 2018, attached hereto as Exhibit A. Loveland shall be the party
issuing the agreement to the selected CMAR. The Training Campus shall be
constructed in accordance with the requirements of the Loveland Municipal Code.
The Cities agree that Loveland shall be the sole signatory for purchasing, consulting,
and other contracts necessary to complete the construction of the Training Campus as
contemplated by the Cities. Loveland must provide Fort Collins an opportunity to
review and comment on such agreements, and Loveland must receive written approval
from Fort Collins prior to executing any such agreements. Loveland shall provide Fort
Collins the opportunity to review and approve any change order in excess of ten
thousand dollars ($10,000). Fort Collins shall have seventy-two (72) hours from
receipt of said change order to consent or object, and Fort Collins’ failure to timely
respond shall be considered consent.
a. Cost. Loveland and Fort Collins mutually agree that the total cost of the Training
Campus shall not exceed $18,518,782.00 dollars and that each City shall be
responsible for appropriating an equal share of the cost ($9,259,391.00).
b. Payments. Loveland shall invoice Fort Collins for Fort Collins’ fifty percent
(50%) share of CMAR and construction costs on a quarterly basis in accordance
with a mutually agreeable payment schedule (the “Payment Schedule”). The
Payment Schedule shall be tied to project milestones identified in the CMAR
contract. Loveland shall invoice Fort Collins for Fort Collins’ share no later than
sixty (60) days in advance of the date payment is due by Loveland under the
CMAR contract payment schedule and associated milestones. Fort Collins shall
pay amounts owed to Loveland within thirty (30) days of receipt of said invoices.
The Cities agree that it is there mutual intent that Loveland have sufficient funds
on hand, contributed equally by the Cities, to meet all payment requirements for
the project. Loveland shall keep payments received from Fort Collins in a
designated account, and any interest earned on said fund shall remain in said
account for the benefit of the Training Campus.
c. Sustainability Requirements.
i. LEED Certification. Subject to Fort Collins City Council’s approval of a
waiver of Fort Collins’ LEED requirements, the Cities agree that the
administration and classroom building portion of the Training Campus
shall be designed to, and certified at, a minimum LEED Gold standard.
The cost of attaining that standard and certification shall be shared equally
by both Cities, because each recognize the significant efficiencies that will
reduce future operational and maintenance costs for the Training Campus.
ii. Photovoltaic System. Both Cities agree to include in the design and
construction of the Training Campus a solar photovoltaic (“PV”) system
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
4
and infrastructure required for a PV system, which PV system to have an
estimated return on investment of ten (10) years or less and an expected
life of twenty-five (25) years or more. The PV system must be sufficiently
sized to achieve all of the energy credits necessary to meet the LEED Gold
certification.
iii. Net Zero Energy. The remaining portions of the Training Campus not
identified in subsection (i) above shall be designed to include high
efficiency components, including but not limited to, high efficiency
mechanical and electrical systems, with the Parties’ intent being to
incorporate as many green building principles as practicable. Loveland
will provide the Training Campus with a minimally sufficient number of
Renewable Energy Credits (“RECs”) to offset any renewable energy
deficiency remaining from the LEED Gold standard to meet net zero
Energy. Loveland shall use a regularly accepted methodology to calculate
the number of RECs needed to close the aforementioned deficiency.
d. Americans with Disabilities. The Training Campus shall be designed and
construction to comply with all federal, state and local laws, including the
requirements of the Americans with Disabilities Act (“ADA”).
e. Construction Grants. Any grants received by the Cities for the benefit of the
construction of the Training Campus, shall be utilized toward making facility
improvements by awarding bid alternates in the contract documents or any other
improvements agreed to by both Cities. Any grants received shall not be included
in the total not-to-exceed amount specified in Subsection (a) of this Section 3.
4. Joint Training Campus Operation and Maintenance. The operation and maintenance
of the Training Campus is a joint venture between the Cities, with full management
and policy-making authority vested equally in both Cities. “Policy Issues” shall
include, but shall not be limited to, participation in federal and state grant agreements,
construction of capital projects, and approval of the annual contributions to the
Training Campus Dedicated Funds (defined below in Section 10). Policy Issues shall
require the approval of each City’s City Councils.
5. Facility Management. Management of the Training Campus shall be vested in each
City’s Chief of Police or his or her designee. The Chiefs of Police shall be
responsible for approving an Operation Plan that will serve as the principal
document by which the Training Campus will be utilized and maintained by the
Cities. The Operation Plan will also address the use of the Training Campus by
third parties including proposed fees for such use, and the manner in which each
City may provide Administrative Services (defined below in Section 7) to benefit
the Training Campus. In addition, the Operation Plan may include rules and
regulations concerning the use of the Training Campus. The Chiefs of Police are
responsible for the governance of the Training Campus related to any issue that is
not considered to be a Policy Issue as defined in Section 4 above, which shall
include approval of all third-party use agreements for the Training Campus. In the
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
5
event of a dispute between the Chiefs of Police that cannot be settled in good faith,
the Cities agree that the dispute will be directed to the City Managers for discussion
and decision. If the Cities fail to resolve disputes via the City Managers, the Cities
may utilize, subject to mutual agreement, the dispute resolution process identified
in Section 17(b) of this Agreement. If the Cities have failed to resolve disputes via
Section 17(b) or have not mutually agreed to utilize Section 17(b), the Cities may
utilize Section 17(c) or Section 18 of this Agreement.
6. Minimum Annual Planning Meeting. The Chiefs of Police and other appropriate staff
shall meet a minimum of once per year in April to discuss any amendments to the
Operation Plan; budgetary requirements for future budget years; scheduling usage of
the Training Campus; the review of rates, fees, and charges; and other pertinent
matters as may be necessary and appropriate for the continued operation and
maintenance of the Training Campus.
7. Administrative Services. Loveland shall provide “Administrative Services” for
the Training Campus, which shall include appropriate costs for services allocated
by Loveland’s Finance, Human Resources, Risk Management, Facilities
Management, Information Technology, City Attorney, postage and other similar
administrative services. After the Training Campus is open and operational, each
City shall be responsible for fifty percent (50%) of the costs of the Administrative
Services. Loveland shall identify the costs for Administrative Services as a separate
line item within the Operations Fund (defined below in Section 10). Loveland shall
place its and Fort Collins’ payments for Administrative Services into the
Operations Fund, and Loveland shall be entitled to draw from the Operations Fund
to pay the costs of the Administrative Services. The administrative charge shall
be calculated in the same manner as charges made by the providing Loveland to its
own governmental enterprise funds.
8. Employee Status. All employees of each City who perform any services in relation to
the Training Campus and this Agreement shall remain the employees solely of the
City which employed them to perform such services and not of the other City.
9. Training Campus Manager, Appointment, and Duties. The Loveland Chief of
Police shall appoint a Training Campus Manager subject to the regulations and
policies of Loveland, after consulting with and obtaining prior written consent of
the Fort Collins Chief of Police. The Campus Manager shall be an employee of the
City of Loveland solely dedicated to the Training Campus. The Campus Manager
shall:
a. Propose an Operation Plan to the Chiefs of Police for their consideration and
approval as soon as practicable; and
b. Subject to and consistent with the direction of the Chiefs of Police, manage the
operations of the Training Campus, in accordance with the Operation Plan, in a
safe and efficient manner and maintain the grounds, structures and equipment
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
6
in a clean, orderly, safe and operational condition in conformity with all
applicable federal, state and local laws, rules and regulations and other legal
requirements; and
c. Manage such operations in a manner which is compatible with the interests of
the Cities; and
d. Perform all duties normally associated with sound, safe, innovative, prudent
and efficient management practices for a law enforcement training facility and
provide for all services as are customary and usual to such an operation,
including, but not limited to, the following:
i. Maintenance and Repair Services. Maintain and repair the Training
Campus (structurally and otherwise) in a good and skillful manner more
particularly described to include:
1. All equipment and facility features including, but not limited to,
the driving track, firearm range, skills pad, and classrooms;
2. All vehicles, machinery and tools used in the operation,
maintenance or repair of the Training Campus;
3. All Training Campus grounds including, without limitation,
fences, parking lots, grass cutting, and removing or topping trees
and shrubs where and when necessary; and
4. All Training Campus buildings and structures, including,
without limitation, plumbing, electrical, sprinkler, heating and
air conditioning systems, apparatus and other equipment; and
5. All components of the Art in Public Places as per requirements
of City of Loveland program.
6. All other maintenance obligations as set forth in the adopted
Operation Plan. The Campus Manager may recommend the
disposition of obsolete or surplus property to Chiefs of Police
consistent with Loveland’s purchasing ordinances, regulations
or rules. Any proceeds from the sale of such surplus property
shall be deposited into the Operations Fund and shared equally
by the Parties.
ii. Support Functions. In a manner consistent with sound law
enforcement training facility operating and safety practices, perform or
cause to be performed:
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
7
1. Operation of the firearms range for the benefit of the Cities and
other third-party users thereof; and
2. Operation of the driving track and skills pad for the benefit of
the Cities and other third-party users thereof; and
3. Operation of the classrooms and other appurtenant facilities for
the benefit of the Cities and other third-party users thereof; and
4. Coordinate with Loveland’s Accounting Department to ensure
timely and accurate collection, remittance, and reporting of all
fees and revenue collected from third-parties that use the
Training Campus; and
5. Expeditious removal of snow and ice from all ways designed for
pedestrian or vehicular use; and
6. Security of the Training Campus; and
7. All other support functions as set forth in the adopted Operation
Plan.
iii. Negotiations with Third Parties. In connection with the solicitation of
proposals for procurement and the negotiation of such Training Campus
use agreements with third parties as may be necessary or desirable for
the proper and financially prudent operation of the Training Campus in
accordance with federal, state and local laws, rules and regulations and
any grant agreements or related assurances, perform the following:
1. Administer and monitor all agreements with third parties and
ensure full and complete compliance with the terms and
conditions contained in such agreements, and endeavor to see
that such agreements are carried out in a manner which is
consistent with the Operating Plan.
2. Subject to direction from the Chiefs of Police and in
conformance with Loveland’s procurement requirements and
the Operation Plan, procure such services, equipment, materials,
and supplies as may be necessary for the proper operation and
marketing of the Training Campus. The Campus Manager may
only procure services, equipment, materials and supplies that do
not exceed $10,000, and no procurement shall be divided so as
to avoid the maximum dollar amount. Each City shall review
and approve all procurements and associated agreements and
change orders exceeding $10,000.
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
8
iv. Training Campus Budget. Timely prepare the Training Campus Annual
Operating Budget to submit said budget to the Chiefs of Police at the
April planning meeting pursuant to Section 6 of this Agreement, and
then timely submit the annual request for the Training Campus budget
contributions through both Cities' regular budget processes for approval.
The Annual Operating Budget shall itemize all anticipated revenues and
operating expenses and shall support such items of revenue and expense
with records and documents.
1. Prepare an Annual Operation Update for submission to the
Chiefs of Police which shall include, but not be limited to: a
maintenance and repair schedule; a schedule of proposed
Training Campus fees for third-party users; a list of all contracts
and agreements to be negotiated, renegotiated or renewed;
recommendations, if any, for revisions of the Operation Plan;
recommendations, if any, for non-capital equipment; a five-year
projection of anticipated revenues and expenses based on a
comparison with the previous fiscal year, if applicable, and
prepared with reference to other relevant data; a schedule of
proposed staffing levels of full-time, part-time and seasonal
employees, and any other factors which may affect Training
Campus operation and management.
v. Capital Replacement Plan. Prepare and submit to the Chiefs of Police a
written five-year Capital Replacement Plan in conjunction with the
annual planning meeting beginning in 2020, and every five (5) years
thereafter or as otherwise directed by the Chiefs of Police.
10. Dedicated Fund. The City of Loveland is acting as the fiscal agent for the Training
Campus and shall keep a fund for the benefit of the Training Campus (the
“Dedicated Fund”). The Dedicated Fund shall consist of two separate and
independent categories of funds: 1) a non-lapsing capital fund (“Capital Fund”);
and 2) a lapsing fund for the annual expenses for Administrative Services,
operation, and maintenance (“Operations Fund”). On an annual basis, when the
budget and annual contributions from each of the Cities are calculated, any
remaining fund balance in the Operations Fund will be applied to offset the annual
contributions from each City to the Operations Fund. On a monthly basis, Loveland
shall provide a record of the revenues, expenses, and account balances for the
Capital Fund and the Operations Fund. The Dedicated Fund shall be equally owned
by both Cities, but will be held in trust by Loveland acting as the fiscal agent.
11. Training Campus Revenue. The Cities shall adopt rates, fees, and charges for third-
party use of the Training Campus in accordance with each City’s charter and
ordinances. All revenue generated by the Training Campus received shall be
deposited into the Operations Fund and shared equally by the Cities.
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
9
12. Grants. Any and all grants received by a City in connection with the Training
Campus shall be shared equally by the Cities and deposited in the appropriate
Dedicated Fund for purposes that are mutually agreed between the Cities.
13. Training Campus Expenses: The net annual operating costs (“Net Annual
Operating Costs”) for the operation and maintenance of the Training Campus will
be funded by the Operations Fund and shared equally on a 50% basis for each City.
The Net Annual Operating Costs shall be calculated by subtracting the budgeted
annual fees, charges and other revenue from the budgeted annual operating costs.
On December 15th
each year, Loveland shall invoice Fort Collins for fifty percent
(50%) of the budgeted Net Annual Operating Costs to be paid by Fort Collins to
Loveland within thirty (30) days of issuance. By September 1st
of each year, the
Cities shall identify any shortfall in the then current annual Operations Fund and
seek supplemental budget and appropriation of an equal share of the additional
funds necessary to satisfy the Net Annual Operating Costs from their respective
City Councils.
a. Expendable supplies, including, ammunition, shooting targets, and fuel shall
not be included in the Operations Fund and will either be supplied by the
individual Cities or shall be captured in the cost to third party users of the
Training Campus.
14. Initial IGA Excess Funds. The Cities agree that any and all excess funds remaining
from Phase 1 of the Training Campus project will be rolled over to support
completion of the design and construction of the Training Campus project. The
Cities, by execution of this Agreement approve the continuation of the Training
Campus project pursuant to Section 4 of the Initial IGA, of which the Cities
acknowledge receipt thereof.
15. Construction Excess Funds: The Cities agree that any excess funds remaining after
the completion of the design and construction of the Training Campus will be
returned to the Cities equally.
16. Status as Governmental Entities. The parties are governmental entities; therefore,
all direct and indirect financial obligations of each party under this Agreement shall
be subject to annual appropriations pursuant to Article X, Section 20 of the
Colorado Constitution, the parties' respective charters and ordinances, and
applicable law. This Agreement and the obligations of the parties hereunder do not
constitute a multi-year fiscal obligation and are expressly contingent upon the
parties' respective governing bodies budgeting and appropriating the funds
necessary to fulfill the parties' respective obligations. If a party does not appropriate
funds sufficient to meet its obligations under this Agreement, such non-
appropriation will constitute a termination by such party, effective on January 1 of
the party’s fiscal year for which the funds are not appropriated regardless of any
notice period required under this Agreement. The non-appropriating party shall
give written notice of such non-appropriation of funds to the other party not later
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
10
than thirty (30) days after it is certain that its governing body will fail to appropriate
the funds necessary for the party to meet its financial obligations for the ensuing
fiscal year. Such termination shall be subject to the provisions of Section 18(b) below.
17. Dispute Resolution.
a. Informal Resolution. Should Loveland or Fort Collins not agree on any matter
arising out of or related to this Agreement or the ownership, use, expansion,
remodel, operation or other matter pertaining to the Training Campus, the Cities
shall use best efforts to meet and seek to resolve their disagreement informally
through discussions between the Police Chiefs. If the Police Chiefs cannot
resolve the dispute, the parties shall bring the dispute to the City Managers for
discussion and decision.
b. Mediator or Arbitrator Selection. In the event Loveland or Fort Collins mutually
agree to binding or nonbinding arbitration or mediation, Loveland and Fort
Collins shall each select an arbitrator or mediator. The arbitrators and mediators
selected by each City shall then select a single arbitrator or mediator to hear and
decide the dispute. Costs of any arbitration or mediator shall be shared
equally by the Cities.
c. Formal Resolution. Should Loveland or Fort Collins, despite best efforts, be
unable to reach agreement, either City may seek to have the dispute resolved by
a court of competent jurisdiction.
18. Termination. If, after the Cities are unable to reach a resolution pursuant to Section 17
of this Agreement through informal resolution, arbitration, or mediation, then if either
City fails to perform its obligations under the terms of this Agreement, the non-
defaulting City may provide the defaulting City with written notice of the nature and
extent of the default. If the default remains uncorrected after thirty (30) days from the
date the notice is received, then the non-defaulting City may elect to bring an action
for specific performance, or to pursue any other remedies provided for in this
Agreement, or remedies available at law or equity.
a. If the parties fail to reach agreement upon any decision which must be reached by
mutual agreement under this Agreement, either party may terminate this
Agreement upon not less than thirty (30) days written notice to the other party.
Each party will equally share and be obligated to pay any financial costs related
to this Agreement that have incurred up to the date of termination.
b. Upon termination, the non-defaulting City, or the City not seeking termination
under the immediately preceding Section 18(a) of the Agreement, (“Purchasing
City”) possesses a right of first refusal to acquire the other City’s interest in the
Training Campus. The Purchasing City shall pay an amount not to exceed
$9,259,391.00 dollars for the other City’s interest in the Training Campus. The
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
11
Purchasing City may select an appraiser who shall provide an appraisal to both
Cities using industry standard methodology for valuing a one half interest in the
Training Campus, without considering anticipated revenues or the land upon
which the Training Campus is constructed. The Purchasing City may then acquire
the other City’s interest by payment to the other City of the amount determined by
Purchasing City’s appraiser (not to exceed $9,259,391.00 dollars). The Purchasing
City will also possess an option to pay the aforementioned determined appraised
value over a three (3) year period in equal installments.
i. Should the Purchasing City decline the right of first refusal, the other City
may only sell its interest in the Training Campus to a political subdivision
of the state of Colorado, a city, or a town, which also manages a law
enforcement agency in Larimer County or Weld County subject to the
approval of the City retaining an interest in the Training Campus, which
shall not be unreasonably withheld. The purchase price may then be
negotiated between the City seeking to sell its interest and the interested
third party political subdivision of the state of Colorado, city, or town,
which also manages a law enforcement agency in Larimer County or Weld
County, Colorado. Any such qualifying entity acquiring an interest in the
Training Campus shall be bound to this Agreement, and any, then existing
amendments, and such qualifying entity shall be substituted in place of the
City no longer retaining an interest in the Training Campus.
ii. Under no circumstances shall either City be permitted to sell, sublease,
transfer or otherwise assign any interest other than a one half interest in
the Training Campus.
19. Notices. Any notice, request, demand, consent, or approval, or other communication
required or permitted hereunder, shall be in writing and shall be deemed to have been
given when personally delivered, faxed, emailed, or deposited in the United States
mail with proper postage and addressed as follows:
If to Loveland:
Chief of Police City Manager
Loveland Police Department with a copy to: Loveland City Attorney
810 E. 10th
Street City of Loveland
Loveland, CO 80537 500 E. 3rd
Street
Loveland, CO 80537
If to Fort Collins:
Chief of Police City Manager
Fort Collins Police Services with a copy to: Fort Collins City Attorney
2221 S. Timberline Road City of Fort Collins
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
12
Fort Collins, Colorado 80525 300 LaPorte Avenue
P.O. Box 580
Fort Collins, CO 80522
20. Relationship of Parties, Non-liability of Individuals, Benefit, No Assignment. The
parties enter into this Agreement as separate, independent governmental entities and
maintain such status throughout. No officer, agent or employee of either party shall
be charged personally or held contractually liable by or to the other party under any
term or provision of this Agreement or of any supplement, modification or amendment
to this Agreement because of any breach thereof, or because of his, her or their
execution or attempted execution of the same. This Agreement is made for the sole
and exclusive benefit of the Cities, their successors and assigns, and is not made for
the benefit of any third party. The parties covenant and agree that they will not assign
this Agreement, any interest or part thereof or any right or privilege pertinent thereto,
without written consent of the other party first having been obtained.
21. Liability. Each party shall be responsible for any and all claims, damages, liability
and court awards including costs, expenses and attorney fees incurred as a result of
any action or omission of such party or its respective officers, employees and agents
in connection with such party’s performance of this Agreement. Notwithstanding
anything in this Agreement to the contrary, nothing herein shall be construed as a
waiver of the notice requirements, defenses, immunities, and limitations of liability
the parties and their respective officers, directors, councilors, employees, volunteers,
and agents may have under the Colorado Governmental Immunity Act, C.R.S. §§ 24-
10-101, et seq., or to any other defenses, immunities, or limitations of liability
available to the parties by law.
22. Insurance. Loveland will require that any vendor selected related to the
construction, maintenance or operation of the Training Campus maintain adequate
general liability insurance, automotive insurance, and builder’s risk insurance
coverage. Upon construction of the Training Campus being completed, Loveland
shall maintain adequate insurance coverage to protect the Cities’ joint interest in
the Training Campus. All insurance premiums and insurance payments related to
the Training Campus shall be considered Administrative Services pursuant to
Paragraph 7 and Paragraph 10 of this Agreement requiring each City to pay one
half the cost of all Administrative Services. The Cities agree to deposit any excess
insurance payments received by the Cities’ insurer, if any into the Operations Fund
and shared equally by the Parties.
23. Entire Agreement/Ambiguities. This Agreement embodies the entire agreement of
the parties. The parties shall not be bound by or be liable for any statement,
representation, promise, inducement or understanding of any kind or nature not set
forth herein. No changes, amendments or modifications of any of the terms or
conditions of this Agreement shall be valid unless reduced to writing and executed by
both parties. In the event of any ambiguity in any of the terms of this Agreement, it
DRAFT FOR DISCUSSION ONLY – SUBJECT TO FURTHER
REVIEW AND REVISION
13
shall not be construed for or against any party hereto on the basis that such party did
or did not author the same.
24. Applicable Law, Severability. The laws of the State of Colorado shall be applied in
the interpretation, execution and enforcement of this Agreement, and venue for any
action arising hereunder shall be Larimer County, Colorado. Any provision rendered
null and void by operation of law shall not invalidate the remainder of this Agreement
to the extent that this Agreement is capable of execution.
25. No Third Party Beneficiaries. This Agreement is made for the sole and exclusive
benefit of the parties hereto and shall not be construed to be an agreement for the
benefit of any third party or parties and no third party shall have a right of action
hereunder for any cause whatsoever.
26. Counterpart Signatures. The parties agree that counterpart signatures of this
Agreement shall be acceptable and that execution of the Agreement in the same form
by each and every party shall be deemed to constitute full and final execution of the
Agreement.
IN WITNESS HEREOF, this Intergovernmental Agreement has been executed that day and
year first above written.
[signature pages follow]
THE CITY OF LOVELAND, COLORADO
A Municipal Corporation
ATTEST:
By: __________________________
______________________ Stephen C. Adams, City Manager
City Clerk
APPROVED AS TO FORM:
___________________________
Loveland City Attorney
THE CITY OF FORT COLLINS, COLORADO
A Municipal Corporation
ATTEST:
______________________ By: _____________________________
City Clerk Mayor
______________________
Printed name
APPROVED AS TO FORM:
Assistant City Attorney
___________________________
Printed name
DOES YOUR AIS INCLUDE AN APPROPRIATION ORDINANCE? If so:
Budget AIS/Ordinance questions to ask:
1) Have you spoken with your department financial staff about this appropriation?
2) What is the funding source for the appropriation?
Prior Year Reserves Grant Revenue
Other Unanticipated Revenue Are there multiple funding sources?
3) If this is a grant, have the grant documents been finalized/signed? Make sure to check with the City
Attorney’s Office before proceeding with an AIS/appropriation request to make sure you are good to
go.
4) If this is appropriation of grant funds, does is require matching funds?
a) Do the funds need to be appropriated in this ordinance or were they previously appropriated?
b) If APP is required, can the grant funds be used for APP or are they restricted?
5) Is this a capital project?
a) Is this the first appropriation for this project, or have funds been previously appropriated? If
previously appropriated, indicate in the AIS the amount and source(s) of funding for the prior
appropriation, including ordinance numbers, if applicable.
b) Is this the final appropriation for the project? If not, include total anticipated project costs and
sources of funds.
c) Art in Public Places (APP) – any questions on APP, contact Ellen Martin or your Budget Analyst
− What portion of the Capital dollars are subject to APP? Take a look at the components of the
project – not all are applicable for APP (such as right-of-way costs).
− If a grant, does it allow using the grant for APP? If not, we need to find another source of
funding for the APP.
6) Is this a Utilities capital project?
a) Art in Public Places (APP) – any questions on APP, contact Ellen Martin or your Budget Analyst
− Has the Utility reached its maximum for APP funding for the year?
7) Please do not use decimals in numbers in the AIS text. Round up or down.
BUDGET AGENDA TEMPLATE
(Use this template to draft your AIS – once it is complete, copy and paste the sections into the
Minute Traq AIS template)
FONT – Arial 10 pt
STAFF:
Michelle Provaznik, Manager of the Gardens on Spring Creek
Jim McDonald, Director of Cultural Services
SUBJECT
Appropriation of Unanticipated Donation Revenues and Gardens Reserves to the Visitor Center
Completion Project at the Gardens on Spring Creek.
EXECUTIVE SUMMARY
1) The purpose of this item is to appropriate revenues raised by the Gardens on Spring Creek and
Friends of the Gardens and Gardens Reserves for completion of Visitor’s Center.
STAFF RECOMMENDATION
BACKGROUND/DISCUSSION
In 2015, Fort Collins voters approved the Community Capital Improvement Program which included $2
million to expand the Visitor’s Center at the Gardens on Spring Creek pending successful fundraising for
the remainder of funds needed for the project. In the 2017-2018 budget cycle, Council approved
$2,185,000 for the Visitor’s Center expansion.
The Visitor’s Center expansion is the second phase of completing The Gardens Master Plan and includes
construction of a conservatory that will operate as a North American Butterfly House in partnership with
the Butterfly Pavilion in Westminster. A new lobby/entrance, meeting room, café concessions, and
expanded gift shop will be added. Plans are attached.
Since 2017, the Friends of the Gardens on Spring Creek Board of Directors has been actively fundraising
to meet the needs of the Visitor’s Center completion project and has secured $572,394 in donations and
pledges. This ordinance will appropriate the $315,000 cash in hand which has been donated to the
project. The remainder of the funding is in pledges that will be received between 2019-2023.
Additionally, The Gardens has strategically built reserves to contribute to capital projects in case of
funding shortfalls or to cover pledged gifts. The Gardens requests $240,000 of reserves be appropriated
to complete the Visitor’s Center. The reserve amount will be fully replenished as the pledged gifts are
received. Pledged gifts will be appropriated to reserves when received.
Construction of the Visitor’s Center will begin in January/February 2019. This immediately follows the
completion of construction of the Gardens expansion of five acres of new gardens including the Great
Lawn, Undaunted Garden, Foothills and Prairie Gardens. The total cost of the garden expansion project
was $2.9 million, $2.1 million was raised by the Friends of the Gardens and $800,000 was provided by
the City of Fort Collins.
The Gardens on Spring Creek will host a grand opening celebration for both projects in fall 2019.
CITY FINANCIAL IMPACTS (how does this item affect City financial resources?)
Prior Appropriated Funds
Prior Appropriated Community Capital
Improvement Funds
$2,185,000
2018 Clean-up $27,394
Operations Services – Existing Building Renovation $304,540
Total Prior Appropriation $2,516,934
Funds to be Appropriated with this Action
Funds donated for the Visitor’s Center Project $315,000
Gardens Reserves $240,000
Total Funds to be Appropriated per this Action $555,000
Total Current Project Budget $3,069,540
Prior Transfer to Art in Public Places $21,850
BOARD OR COMMISSION RECOMMENDATION
The Completion of the Gardens on Spring Creek Master Plan has been supported by the Parks and
Recreation Board and Cultural Resources Board.
PUBLIC OUTREACH: The Gardens on Spring Creek Master Plan and Visitor’s Center design was
originally approved in 2000. As the Visitor’s Center Design is nearly identical to the originally approved
plan, a minor amendment process has been undertaken. No further public outreach was required.
ATTACHMENTS Designs
1
Appropriations for Gardens Visitor’s Center Completion
Michelle Provaznik
12-17-18
Floor Plan
2
Project Budget and Revenue Sources
Project Budget $ 3,069,540
City of Fort Collins, CCIP - New Construction $ 2,185,000
Operations Services - Existing Building Renovation $ 304,540
Fundraising $ 580,000
Fundraising to Date - Cash on Hand $ 342,394
Appropriated in 2018 Clean-up $ 27,394
To Be Appropriated $ 315,000
Gardens Reserves $ 240,000
Total Cash on Hand and Reserves $ 582,394
2019 2020 2021 2022 2023
Pledged Donations $ 230,000 $ 130,000 $ 30,000 $ 30,000 $ 20,000 $ 20,000
Visitor's Center Budget and Funding
Year Pledged
3
Appropriation Request Before Council
Appropriations Request:
• $315,000 in unanticipated
donations
• $240,000 temporary use
of Gardens Reserves***
***Garden Reserves to be paid
back through pledge payments.
4
Capital Funding History 1997 - 2019
Throughout its history, the Gardens on Spring Creek has grown due to
the public/private partnership between the City of Fort Collins and its
nonprofit partner, the Friends of the Gardens on Spring Creek.
Total Capital Investment: $9,250,000
City of Fort Collins Funding: $5,300,000 (57%)
Friends of the Gardens Fundraising: $3,950,000 (43%)
5
Funding History
1997: Voters approve $2
million to build a Community
Horticulture Center
2004: Gardens on Spring Creek
opens its doors to the public.
Friends Board raises $80,000
for the Evelyn Clark Classroom.
6
2006
Children’s Garden opens.
$500,000 private funds
7
2009 - 2010
Garden of Eatin’ &
Outdoor Teaching Kitchen
Open
Outdoor Classroom built
$350,000 private funds
8
2011 - 2012
Rock Garden and
Sustainable Backyard open.
$340,000 private funds
9
2017 - 2018
5-acre Garden Expansion
Project including Great Lawn,
Undaunted Garden, Foothills
& Prairie Gardens
$2.9 million budget
• $2.1 million private funds
• $800,000 City of Fort Collins
10
2019
Visitor’s Center Completion
$3.07 million budget
• $2.2 million City of Fort
Collins, CCIP
• $300,000 City of Fort
Collins, Operations Services
• $580,000 private funds
11
2019 Timeline
12
Questions Before Committee
1. Does the Council Finance Committee support the temporary use of
reserves to complete the Visitor’s Center project while remaining
pledges are contributed over time?
2. Does the Council Finance Committee have questions about the
appropriation of unanticipated revenues designated for the project?
13
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Josh Birks, John Duval
Date: December 17, 2018
SUBJECT FOR DISCUSSION
Metro District Policy Updates
EXECUTIVE SUMMARY
The purpose of this item is to present several changes to the Metro District Policy, adopted by
City Council on August 21, 2018, and changes to the accompanying Model Service Plan. These
changes included clarification regarding timing and deadlines for submittal and reflect changes
to the Model Service Plan requested by Council during their recent consideration of three service
plans this past September. Aside from the timing changes to the policy, these changes should be
familiar to the Finance Committee (“Committee”) and City Council.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does the Committee support the proposed changes to the Metro District Policy and
Model Service Plan?
BACKGROUND/DISCUSSION
On August 21, 2018, City Council adopted Resolution 2018-079 revising the Policy for
Reviewing Service Plans of Metropolitan Districts (the “Metro District Policy” or “Policy”)
previously adopted by Council through Resolution 2008-069. The new policy made several
fundamental changes to the previous policy. Shortly after adopting this new policy, City Council
considered and approved the Service Plans for three new Metro Districts. During Council’s
consideration of these items several changes were made to the service plans. Staff understood
Council’s direction in requesting these changes constituted precedent for the review of future
service plans. After Council’s review of the three most recent service plans, Staff met to debrief
the process and discussed opportunities for improvement. Both the changes requested by Council
and several process improvements are presented in this policy update.
UPolicy Changes & Process Improvements:
Staff proposes to revise the Metro District Policy in the following ways (listed in the order in
which they appear in the Policy):
1. Workforce Housing – This minor change adjusts the target Area Median Income
(“AMI”) target range to 81 to 120 percent and adds the category to Exhibit A – Public
Benefit Examples of the Policy.
2. Staff Response to Letter of Intent – To enhance clarity for applicants, the policy has
been revised to require staff respond to any Letter of Intent within thirty (30) days of
receipt and payment of pre-application fees.
3. Formal Application Submission Deadlines – To ensure adequate time for review and
consideration, the policy has been revised to include a deadline for formal application
submittal that provides a minimum of approximately 120 days for review. There are two
deadlines each is linked to a potential election date, either spring or fall.
4. Public Hearing Notice – This minor change shifts the Council Public Hearing section to
a separate section in the policy.
5. Council Public Hearing – This new section of the policy addresses the timing for
Council to conduct a public hearing requiring that the hearing occurs at least thirty (30)
days prior to the final submission date for the District Court to order an election. This
should provide the Council a minimum of two (2) regular council meetings to consider a
service plan.
6. Order of Proceedings at Public Hearing – This is the largest change to the policy. This
new section lays out an order of proceedings for the public hearing that mirrors the
development review hearing process. The intent of this revision is to facilitate a more
complete review of a proposed service plan allowing Council to hear directly from the
applicant.
A redline version of the Policy has been included for reference, see Attachment 2.
UModel Service Plan Changes:
Staff proposes to revise the Model Service Plan (Exhibit B of the Policy) in the following ways
(listed in no order):
1. Further Council Approval Required – No Debt, Debt Mill Levy, or Fees to pay debt
may be issued or collected until City Council approves an intergovernmental agreement
and/or development agreement securing the Public Benefits (Section IV.B(1-3)).
2. City may Dissolve a District for Inaction – Revisions to Section XVI now empower the
City, at its option, to dissolve the District if no intergovernmental agreement or
development agreement has been approved by City Council within three years of Service
Plan approval.
3. Regional Improvements Clean-up – Several minor changes have been made throughout
the document to clean-up the commitment by a district to establish the ability to support
Regional Improvements through the imposition of a 5.000 mill levy.
4. Financial Plan – Clarifying language has been added to section IX.A indicating that the
financial plan attached to a service plan is based on “economic, political and industry
conditions as they exist presently and reasonable projections and estimates of future
conditions.” Furthermore, the estimates and projections presented are not to “be
interpreted as the only method of implementation of the Districts’ goals and
objectives…” This allows for the financial plan to adjust over time as long as those
adjustments comply with the terms of the Service Plan.
5. Maximum Debt Authorization – Section IX.B(7) has been revised to clarify the
applicability of the Maximum Debt Authorization excludes Intergovernmental Capital
Pledge Agreements between two or more of the Districts created by a given service plan.
6. Board Meetings – Language clarifying the requirement to have board meetings in three
of the four quarters shall not apply until there is at least one end user of property within a
district and terminates when most of the directors on a district’s board are end users.
7. Other Minor Changes - All other changes in the Model Service Plan are either
refinements in the spirit of the original Model Service Plan, minor in nature, or further
changes for clarification.
8. Intergovernmental Agreement – Optional language will be added to allow for an
intergovernmental agreement between the City and metro districts as needed for some
districts in order to provide another tool for the City to enforce the approved service plan.
ATTACHMENTS
1. Staff Presentation
2. Redline of the Metro District Policy
1
Metro District Policy Updates
Josh Birks
December 17, 2018
Direction Sought & Questions
1. Does the committee support the proposed changes to the Metro
District Policy and Model Service Plan?
2
Past Work
3
Aug. 21, 2018 Adopt
Revised Policy
• Updated policy adopted by Resolution –
Allows residential and focuses on “stretch”
outcomes
September
• Council considers three
proposed Districts
Today
Policy & Process Improvements
Workforce Housing
LOI Response Time
Application Submission
Deadlines
Council Public Hearing Timing
Public Hearing Order of
Proceedings
4
Revised Timing
5
Submit
LOI
Staff
Response
30 Days
Sept.
(3rd Tuesday)
Nov.
Council
Review
Election
Oct.
District
Court
120 Days 30 Days
Staff Analysis
May
(3rd Tuesday) August
Council
Finance
Application
Submittal
Order of Proceedings
Overview Applicant
Presentation Staff Report
Public
Testimony
Testimony
Response
Council
Deliberation
6
Model Service Plan Changes
Performance Assurances
• Further Council Approval
• Dissolution
Clean-Up
• Regional Improvements
• Financial Plan
• Maximum Debt
Authorization
• Board Meetings
7
Direction Sought & Questions
1. Does the committee support the proposed changes to the Metro
District Policy and Model Service Plan?
8
1
CITY OF FORT COLLINS POLICY FOR REVIEWING SERVICE PLANS FOR
METROPOLITAN DISTRICTS
August 21, 2018
January 15, 2019
Introduction.
This policy establishes the criteria, guidelines and processes to be followed by City Council and City staff
in considering and by applicants in submitting to the City service plans for the organization of
metropolitan districts or amendments to those plans (“Policy”), as provided in Colorado’s Special District
Act in Article 1 of Title 32 of the Colorado Revised Statutes (the “Act”). The Act provides that
metropolitan districts are quasi-municipal corporations and political subdivisions (“District”) that can be
organized within the boundaries of a municipality provided the municipality’s governing body approves
by resolution the proposed service plan for the District. Under the Act, the service plan constitutes the
document that delineates the specific powers and functions the District can exercise, including the
facilities and services it can provide, the taxes it can impose and its permitted financial arrangements
(the “Service Plan”). The Act requires Districts to conform to their Service Plans.
Section 1 – Policy Objectives and Statements.
A. This Policy generally supports the formation of a District where it will deliver Uextraordinary
public benefitsU that align with the goals and objectives of the City whether such extraordinary
public benefits are provided by the District or by the entity organizing the District because the
District exists to provide public improvements.
B. A District, when properly structured, can enhance the quality of development in the City. The
City is receptive to District formation that provides Uextraordinary public benefitsU which could
not be practically provided by the City or an existing public entity, within a reasonable time and
on a comparable basis. It is not the intent of the City to create multiple entities which would be
construed as competing or duplicative.
C. UThe approval of a District Service Plan is at the sole discretion of City CouncilU, which may
reject, approve, or conditionally approve Service Plans on a case-by-case basis. Nothing in this
Policy is intended, nor shall it be construed, to limit this discretion of City Council, which retains
full authority regarding the approval, terms, conditions and limitations of all Service Plans.
D. UPolicy ObjectivesU.
The City will evaluate a proposed District and its Service Plan based on the District’s ability to
deliver Upublic benefitsU through UextraordinaryU development outcomes, specific examples are
provided in Exhibit A and generally occur in the following four focus areas:
2
1. UEnvironmental Sustainability Outcomes:U Development of public improvements that deliver
or facilitate the delivery of specific and measurable environmental outcomes, including but
not limited to: (i) reduction of Green House Gases (“GHG”), (ii) conservation of water or
energy, (iii) encourage multimodal transportation, (iv) enhance community resiliency –
against future environmental events (e.g., flooding, drought, etc.); (v) increase renewable
energy capacity; and/or (vi) deliver other environmental outcomes.
2. UCritical Public InfrastructureU: Development of public improvements that address or facilitate
addressing significant infrastructure challenges previously identified by the City, either
within or proximate to the District, whether such improvements address a locally-significant
challenge or a City-wide challenge.
3. USmart Growth ManagementU: Development of public improvements that deliver or facilitate
the delivery of specific design components that: (i) increase the density of development
within the District; (ii) establish, enhance or address the walkability and pedestrian
friendliness of the District; (iii) increase the availability of transit and/or multimodal oriented
facilities; (iv) create compelling public spaces; and/or (v) encourage mixed-use development
patterns.
4. UStrategic Priorities:U Development of public improvements that deliver or facilitate the
delivery of strategic priorities specified in the City’s existing long-term strategic planning
documents, such as City Plan, Affordable Housing Plan, Economic Health Strategic Plan, and
applicable Sub-Area Plans. These priorities include, but are not limited to:
a. UAffordable Housing:U Deliver or facilitate the delivery of additional affordable housing
units at the City’s defined level of Area Median Income (“AMI”) or below. The City
defines Affordable Housing as units affordable to a household earning 80 percent of
AMI.
b. UWorkforce Housing:U Deliver or facilitate the delivery of workforce housing units in the
City’s defined range of AMI. For purposes of this policy, Workforce Housing units shall
be defined as units affordable to a household earning between 801 percent and 120
percent of AMI.
c. UInfill/Redevelopment:U Enable the infill or redevelopment of property within the City,
especially when such development is consistent with City Plan.
d. UEconomic Health OutcomesU: Enable delivery of specific and measurable economic
outcomes, such as: (i) job growth; (ii) retention of an existing business; and/or (iii)
construction of a missing economic resource.
In determining whether a proposed District delivers extraordinary public benefits, the City may
consider: (i) ways in which the proposed improvements exceed the City’s minimum
requirements and standards; (ii) ways in which the existence of the District facilitates the
3
extraordinary public benefits and whether the extraordinary benefits are feasible without the
District; (iii) ways in which the proposed extraordinary benefits work together as a system to
deliver greater benefit to the community than individually; and (iv) any other factors the City
deems relevant under the circumstances.
E. UPolicy Statements:
1. ULimited Use:U The City wishes to exact a high standard of use for Districts thereby limiting
their use. An applicant project is expected to deliver extraordinary benefits across multiple
City objectives two or more of the objectives described in Section 1.D. of this Policy.
2. UBroad and Demonstrable Public Benefit:U Districts are expected to provide broad public
benefit and the applicant will be asked to demonstrate and provide assurances of those
benefits. The City will utilize the Service Plans, development agreements, and other
contractual agreements to document and enforce District commitments.
3. UDistrict Governance:U It is the intent of the City that owner/resident control of Districts occur
as early as feasible. Service Plans should include governance structures that encourage and
accommodate this. The use of control Districts (also known as “service” or “managing”
Districts) that allow developers to control the other Districts that provide the tax revenues
beyond the time needed to repay the issued debt, is to be discouraged.
4. UBasic Infrastructure Improvements:U A District proposing to fund basic infrastructure
improvements will not be favorably received except when used to offset higher costs
associated with delivering public benefit through extraordinary development outcomes (see
Exhibit A for examples).
5. UMinimum District Size:U A District proposed to issue less than $7 million of authorized debt
will not be considered.
Section 2 – Evaluation Criteria
A. To provide City Council with information and an assessment consistent with this Policy, staff will
review and report on District proposals in the following areas:
1. UPublic Benefit Assessment and Triple Bottom Line Scan:U To comprehensively and
consistently evaluate District proposals, an interdisciplinary staff team, inclusive of
representatives from Planning, Economic Health, Sustainability, and other Departments as
appropriate, will be formed. This team will rely on the City’s Triple Bottom Line evaluation
approach, and other means, to assess a District proposal consistent with this Policy and City
goals and objectives more broadly.
2. UFinancial Assessment:U All District proposals are required to submit a Financial Plan to the
City for review. Utilizing the District’s Financial Plan, and other supporting information
which may be necessary, the City will evaluate a District’s debt capacity and servicing ability.
4
Additionally, should a District desire to utilize District funding for basic infrastructure
improvements, as determined by the City in its sole discretion, staff will assess the value of
this benefit against the public benefits received in exchange.
3. UPolicy Evaluation:U All proposals will be evaluated by City staff against this Policy and the
City’s “Model Service Plan” attached as Exhibit “B”, with any areas of difference being
identified, evaluated and reported to City Council.
Section 3 – Application Process
A. UProcess Overview:U The application process is designed to provide early feedback to an applicant,
adequate time for a comprehensive staff review, and the appropriate steps and meeting
opportunities with decision makers.
B. ULetter of Interest:U Applicant will provide City with a Letter of Interest and pre-application fee
(refer to fees below). The Letter of Interest shall contain the following:
1. Summary narrative of the proposed development and District proposal.
2. Sketch plan showing: property location and boundaries; surrounding land uses; proposed
use(s); proposed improvements (buildings, landscaping, parking/drive areas, water
treatment/detention, drainage); existing natural features (water bodies, wetlands, large
trees, wildlife, canals, irrigation ditches); utility line locations (if known); and photographs
(helpful but not required).
3. Clear justification for why a District is needed.
4. Explanation of public benefits, making specific reference to this Policy and other relevant
City documents.
5. District proposal and Service Plan specifics, including: District powers and purpose; District
infrastructure and costs; mill levy rate (both debt and, operations and maintenance); term
of District; forecasted period of build-out; proposed timeline for formation; and current
development status of project.
C. UStaff Response to Letter of Interest:U Staff will provide a written response to a Letter of Interest
[within thirty (30) days] of receipt and payment of the pre-application hearing.
C.D. UPreliminary Staff Meeting with Applicant (Optional):U Based on an initial review of the
Letter of Interest, staff may meet with the applicant to discuss the District proposal, potential
public benefits, initial staff feedback, the evaluation process, fees, and other application
elements.
D.E. UFormal Application and Service Plan Submittal:U Upon taking account of staff input, applicant
may submit a formal application for consideration following the requirements specified in the
City’s District Application, including the Service Plan in which the applicant shall highlight the
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substantive provisions that deviate from this Policy and the Model Service Plan attached as
Exhibit “B”. The formal application and application fees must be received by the City no later
than the third Tuesday of December in the preceding year for a spring election (May) or the
third Tuesday of May for a fall election (November). The City cannot commit to timely
processing of applications submitted after these dates for their respective elections.
E.F. UFormal Staff Review:U An interdisciplinary staff team will review the applicant submittal along
with any follow-up documentation that is requested in order to assess the application according
to this Policy and other appropriate City policy. Applicants should expect several rounds of
feedback and review from City staff.
F.G. UCouncil Finance Committee Meeting:U The Council Finance Committee will review all District
proposals and provide feedback and recommendations.
G.H. UCouncil Work Session Meeting (optional):U Based on the magnitude and complexity of
the development project and District proposal, staff and/or the Council Finance Committee may
recommend a Council Work Session.
H.I. UCouncil Public Hearing:U The City Council will conduct a noticed public hearing at a regular or
special Council meeting to consider resolution approval of Service Plan. UPublic Hearing Notice:U
The Service Plan Applicant must cause a written notice of the public hearing to be mailed by
first-class mail to all fee title owners of real property within the boundaries of the proposed
District(s) and of any future inclusion area proposed in the Service Plan and such notice shall be
mailed no later than thirty (30) days before the scheduled hearing date. A notice shall also be
published once in a newspaper of general circulation in the City no later than thirty (30) days
before the scheduled hearing date. The mailed and published notices shall include the following
information:
1. A description of the general nature of the public improvements and services to be provided
by the District;
2. A description of the real property to be included in the District and in any proposed future
inclusion area, with such property being described by street address, lot and block, metes
and bounds if not subdivided, or such other method that reasonably apprises owners that
their property will or could be included in the District’s boundaries;
3. A statement of the maximum amount of property tax mill levy that can be imposed on
property in the District under the proposed Service Plan;
4. A statement that property owners desiring to have the City Council consider excluding their
properties from the District must file a petition for exclusion with the Fort Collins City Clerk’s
Office no later than ten (10) days before the scheduled hearing date in accordance with
Section 32-1-203(3.5) of the Colorado Revised Statutes;
6
5. A statement that a copy of the proposed Service Plan can be reviewed in the Fort Collins City
Clerk’s Office; and
6. The date, time and location of the City Council’s public hearing on the Service Plan.
J. UCouncil Public Hearing:U The City Council will conduct a noticed public hearing at a regular or
special Council meeting to consider resolution approval of Service Plan. This hearing will occur
no later than [thirty (30) days] prior to the final submittal date to the District Court to order an
election. By way of example, for a typical fall election the final submittal date to the District
Court is [Insert Date Here]. In order to conduct a hearing thirty (30) days prior, City Council,
which meets on the first and third Tuesday’s of the month, must conduct the public hearing no
later than [the third Tuesday in August].
K. UProceedings at Public Hearing:U The hearing shall be conducted under and in accordance with the
applicable procedures of the City Council’s adopted “Rules of Procedure Governing the Conduct
of City Council Meetings and Work Sessions,” except that the order of the proceedings of the
public hearing on the service plan shall be as follows:
1. Announcement of item;
2. Consideration of any procedural issues;
3. Explanation of the application by City staff;
4. Presentation by the applicant;
5. Public testimony regarding the application;
6. Rebuttal testimony by the applicant;
7. Councilmember questions of City staff and the applicant; and
8. Motion, discussion and vote by City Council.
Section 4 –Service Plan
A. UPurpose:U In addition to the requirements of the Act, a Service Plan should memorialize the
understandings and agreements between the District and the City, as well as the considerations
that compelled the City to authorize the formation of the District. The Service Plan must also
include all applicable information required by the Act.
B. UCompliance with Applicable Law:U Any Service Plan submitted to the City for approval must
comply with all state, federal and local laws and ordinances, including the Act.
C. UModel Service Plan:U To clearly communicate City requirements and streamline legal review, the
City will require the use of its Model Service Plan attached as Exhibit B. With justification, the
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City may consider deviations in the proposed Service Plan, but generally all Service Plans should
include the following:
1. UEminent Domain NOT Authorized:U The Service Plan shall contain language that prohibits the
District from exercising the power of eminent domain. However, the City may choose to
exercise its power of eminent domain to construct public improvements within the District
in which case the District and the City will enter into an intergovernmental agreement
concerning the public improvements and funding for that use of eminent domain.
2. UMaximum Mill Levy:U The Service Plan shall restrict the District’s total mill levy authorization
for both debt service and operations and maintenance to fifty (50) mills, subject to
adjustment as provided below. A portion of the Maximum Mill Levy may be utilized by the
District to fund operations and maintenance functions, including customary administrative
expenses incurred in operating the District such as accounting and legal expenses and
otherwise complying with applicable reporting requirements. No more than ten (10) mills
may be used for operations and maintenance (the “Operations and Maintenance Mill
Levy”).
a. Increased mill levies may be considered for Districts that are predominately commercial
in use, at the sole discretion of the City Council.
b. The Maximum Mill Levy may be adjustable from the base year of the District as provided
for in the Model Service Plan, so that to the extent possible, the actual tax revenues
generated by the District’s mill levy, as adjusted, for changes occurring after the base
year, are neither diminished nor enhanced as a result of the changes.
3. UDebt Term Limit:U A District shall be allowed no more than forty (40) years for the levy and
collection of taxes used to service debt unless a majority of the Board of Directors of the
District imposing the mill levy are residents of such District and have voted in favor of a
refunding of a part or all of the Debt and such refunding is for one or more of the purposes
authorized in C.R.S. Section 11-56-104.
4. UDistrict Dissolution:U Perpetual Districts shall not be allowed except in cases where ongoing
operations and maintenance are required. Except where ongoing operations and
maintenance has been authorized, a District must be dissolved as soon as practical upon:
a. The payment of all debt and obligations; and
b. The completion of District development activity.
5. UDistrict Fees:U Impact fees, development fees, service fees, and any other fees must be
identified with particularity in the District Service Plan. Impact and development fees must
not be levied or collected against the end user – i.e., residents and/or non-developer
owners.
8
6. UNotice Requirements:U The Service Plan shall require that the District use reasonable efforts
to assure that all developers of the property located within the District provide written
notice to all purchasers of property in the District regarding the District’s existing mill levies,
its maximum debt mill levy, as well as a general description of the District’s authority to
impose and collect rates, fees, tolls and charges. The form of notice shall be filed with the
City prior to the initial issuance of the debt of the District imposing the mill levy.
7. UAnnual Report:U The Service Plan must obligate the District to file an annual report not later
than September 1 of each year with the City Clerk for the year ending the preceding
December 31, the requirements of which may be waived in whole or in part by the City
Manager. Details of the Annual Report are included in the Model Service Plan.
D. UService Plan Requirements:U In additional to all other information required in a Service Plan by
the Act, a Service Plan must include the following:
1. UFinancial Plan:U The Service Plan must include debt and operating financial projections
prepared by an investment banking firm or financial advisor qualified to make such
projections. The financial firm must be listed in the Bond Buyers Marketplace or, in the
City’s sole discretion, other recognized publication as a provider of financial projections. The
Financial Plan must include debt issuance and service schedules and calculations
establishing the District’s projected maximum debt capacity (the “Total Debt Limitation”)
based on assumptions of: (i) UProjected Interest RateU on the debt to be issued; (ii) UProjected
Assessed ValuationU of the property within the District; and (iii) UProjected Rate of AbsorptionU
of the assessed valuation within the District. These assumptions must use market-based,
market comparable valuation and absorption data and may use an annual inflation rate of
three percent (3%) or the Consumer Price Index for the preceding 12-month period for the
Denver-Boulder-Greeley statistical region as prepared by the U.S. Department of Labor
Statistics, whichever is lesser.
a. UTotal Debt Limitation:U The total debt authorized in the Service Plan must not exceed
100% of the projected maximum debt capacity as shown in the Financial Plan.
b. UAdministrative, Operational and Maintenance Costs:U The Financial Plan must also
include foreseeable administrative, operational and maintenance costs.
2. UPublic Improvements and Estimated Costs:U Every Service Plan must include, in addition to all
materials, plans and reports required by the Act, a summary of public improvements to be
constructed and/or installed by the district (the “Public Improvements”). The description of
these Public Improvements must include, at a minimum:
1. A map or maps, and construction drawings of such a scale, detail and size as
required by the Planning Department, providing an illustration of public
improvements proposed to be built, acquired or financed by the District;
9
2. A written narrative and description of the public improvements; and
3. A general description of the District’s proposed role with regard to the same.
Due to the preliminary nature, the Service Plan must indicate that the City’s approval of the
Public Improvements shall not bind the City, its boards and commissions, and City Council in
any way relating to the review and consideration of land use applications within the District.
3. UIntergovernmental Agreement:U Any intergovernmental agreement which is required or
known at the time of formation of the District to likely be required, to fulfill the purposes of
the District, must be described in the Service Plan, along with supporting rationale. The
Service Plan must provide that execution of intergovernmental agreements which are likely
to cause substantial increase in the District’s budget and are not described in the Service
Plan will require the prior approval of City Council.
4. UExtraterritorial Service Agreement:U The Service Plan must describe any planned
extraterritorial service agreement. The Service Plan must provide that any extraterritorial
service agreement by the District that are not described in the Service Plan will require prior
approval of City Council.
Section 5 – Regional Improvements
A. UPurpose:U A Service Plan may include a section addressing the planning, design, acquisition,
funding, construction, installation, relocation and/or redevelopment of Regional Improvements.
Such section is intended to ensure that the privately-owned properties to be developed in a
District that benefit from the Regional Improvements pay a reasonable share of the associated
costs.
B. Eligible Improvements: The City, to facilitate transparency, will include a list or exhibit in any
Service Plan including a Regional Improvements section that clearly identifies the improvements
to be funded, in part or whole, by a Regional Mill to be levied by the District. In selecting
improvements to be included in a Service Plan the City will apply the following standards:
1. UBenefit to End UserU – Regional Improvements should have a clear benefit to the private-
owned properties funding the Regional Mill Levy. The City may establish this connection
either through previous identification of the infrastructure need and/or through a technical
analysis, such as a traffic impact analysis.
2. USpecificityU – When possible, the City should include as much specificity about the Regional
Improvements to be included in a Service Plan as possible, while noting that any details are
preliminary and may be subject to change as planning, design, acquisition, funding,
construction, installation, relocation and/or redevelopment of the Regional Improvements
occurs.
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3. UNo Other Funding ExistsU – The City will exclude improvements, either in part or whole, for
which funding mechanisms exists to support the planning, design, acquisition, funding,
construction, installation, relocation and/or redevelopment. By way of example, the City
collects Capital Expansion Fees to support street oversizing, however, several bridge
structures necessary to facilitate grade separated crossings of railroad infrastructure were
not included in the calculation of these Fees; therefore, the bridges would be and eligible
Regional Improvement, where the road surface itself would not.
Section 5 – Fees
A. No request to create a Metro District shall proceed until the fees set forth herein are paid when
required. All checks are to be made payable to the City of Fort Collins and sent to the Economic
Health Office.
1. ULetter of Intent Submittal FeeU: A Letter of Intent is to be submitted to the City’s Economic
Health Office and a non-refundable $2,500 fee shall be paid at the time of submittal of the
Letter.
2. UApplication FeeU: An application along with a draft Service Plan (based on the Model Service
Plan) is to be submitted to the City’s Economic Health Office and a $7,500 non-refundable
fee along with a $7,500 deposit towards the City’s other expenses shall be paid at the time
of submittal of the Application and draft Service Plan.
3. UAnnual FeeU: Each District shall pay an annual fee for the City’s on-going monitoring of each
Metro District. This annual fee shall be $500 or if multiple Districts exist serving a single
project, then the annual fee shall be $500 plus $250 for each additional District beyond the
first (e.g., the annual fee for Consolidated ABC Metro Districts 1 to 7 shall be $500 plus $250
times six or $2,000).
4. UNon-Model Service Plan FeeU: A District proposal requesting a substantial deviation from this
Policy or the Model Service Plan, shall pay an additional non-refundable fee of $5,000 at the
time of submitting its application; the City shall in its sole and reasonable discretion
determine if a draft Service Plan proposes a substantial deviation from this Policy or the
Model Service Plan.
5. UOther ExpensesU: If the deposits paid in subsections 2 and 6 are not sufficient to cover all the
City’s other expenses, the applicant for a District shall pay all reasonable consultant, legal,
and other fees and expenses incurred by the City in the process of reviewing the draft
Service Plan or amended Service Plan prior to adoption, documents related to a bond issue
and such other expenses as may be necessary for the City to incur to interface with the
District. All such fees and expenses shall be paid within 30 days of receipt of an invoice for
these additional fees and expenses.
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6. UService Plan Amendment FeeU: If a proposed amendment to a Service Plan is submitted to
the City’s Economic Health Office, it should be submitted with a non-refundable $2,500 fee
along with a $2,500 deposit towards the City’s other expenses and shall be paid at the time
of submittal of the application and draft amended Service Plan.
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EXHIBIT A
PUBLIC BENEFIT EXAMPLES
The following list of examples is meant to be illustrative of the types of projects that deliver the defined
public benefits in this policy. Projects that deliver similar or better outcomes will also be considered on
their merits.
(Continued on next page)
Category / Sub-Category Example Projects
1. Green House Gas Reductions - See subsequent sub-categories
2. Water and/or Energy Conservation
- District-wide non-potable water system(s)
- District-wide renewable energy systems(s)
- Delivery of 20% or more rooftop solar
- Greywater reuse system(s) - if allowed by law
3. Multimodal Transportation
- Buffered bike lanes
- Wider than required sidewalks
- Enhanced pedestrian crossings
- Underpass(es)
4. Enhance Community Resiliency
- Significant stormwater improvements (previously identified)
- Improvements to existing bridges
5. Increase Renewable Energy Capacity
- District-wide renewable energy systems(s)
- Set aside land for community solar garden(s)
- Utility scale renewable project(s)
1. Within District Area
- Community Park Land (beyond code requirements)
- Regional Stormwater Facilities
- Major arterial development
- Parking Structures (Publicly Accessible)
2. Adjacent to Proposed District
- Contribution to major interchange/intersection
- Contribution to grade separated railroad crossings
Environmental Sustainability Outcomes
Critical Public Infrastructure
13
Category / Sub-Category Example Projects
1. Increase density
- Alley load construction
- Smaller Lot Size
- Increased multifamily development
2. Walkability & Pedestrian Friendliness
- Wider than required sidewalks
- Enhanced pedestrian crossings
- Underpass(es)
- Trail system enhancements
3. Increase availablity of Transit
- Improved bus stops
- Restricted access guideways for bus operations
- Transfer facilities
4. Public Spaces
- Pocket Parks
- Neighborhood Parks (beyond code requirements)
1. Affordable Housing
- Units permanently affordable to 80% Area Median Income
- Land dedicated to City's land bank program
2. Infill/Redevelopment
- Address environmental contamination / concern
- Consolidate wetlands or natural area (positive benefits)
3. Economic Health Outcomes
- Facilitate job growth (at or above County median income)
- Retain an existing business
High Quality and Smart Growth Management
Strategic Priorities
14
Category / Sub-Category Example Projects
1. Increase density
- Alley load construction
- Smaller Lot Size
- Increased multifamily development
2. Walkability & Pedestrian Friendliness
- Wider than required sidewalks
- Enhanced pedestrian crossings
- Underpass(es)
- Trail system enhancements
3. Increase availablity of Transit
- Improved bus stops
- Restricted access guideways for bus operations
- Transfer facilities
4. Public Spaces
- Pocket Parks
- Neighborhood Parks (beyond code requirements)
1. Affordable Housing
- Units permanently affordable to 80% Area Median Income
- Land dedicated to City's land bank program
2. Attainable Housing
- Units permanently affordable to 81 to 120% Area Median
Income
2. Infill/Redevelopment
- Address environmental contamination / concern
- Consolidate wetlands or natural area (positive benefits)
3. Economic Health Outcomes
- Facilitate job growth (at or above County median income)
- Retain an existing business
High Quality and Smart Growth Management
Strategic Priorities
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EXHIBIT B
MODEL SERVICE PLAN
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Josh Birks, Jennifer Poznanovic, Victoria Shaw
Date: December 17, 2018
SUBJECT FOR DISCUSSION
Mall Financial Review & Net Taxable Sales Data
EXECUTIVE SUMMARY
The purpose of this item is to present an overview of the financial performance of the Foothills
Mall Redevelopment and recently analyzed data on net taxable sales trends in the City of Fort
Collins. The financial performance of the mall will include an analysis of anticipated City
contributions from sales tax versus newly revised estimates and an update on the sales per square
foot performance of the property. The net taxable sales trends will provide additional background
for discussions regarding future sales tax revenue trends.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
No specific direction is sought. This item is informational only.
BACKGROUND/DISCUSSION
UFoothills Mall Financial Performance
The Foothill Mall Redevelopment project is supported by a public finance package that includes
five revenue sources: (a) Metro District Capital Mills; (b) Metro District Specific Ownership Tax
(c) Property Tax Increment; (d) Public Improvement Fee; (e) Sales Tax Increment. All revenues
were pledged to the Foothills Metropolitan District to support the issuance of bonds. The bonds
provided the direct subsidy to the project to fund a portion of on-site and off-site construction
costs. The pledge or sales tax revenue is intended to support the bond debt service only if needed
and to fill a supplemental reserve account required by the bond terms. Staff has prepared an
update to the performance of the public finance package and retail sales performance.
The estimated investment contributed from the City of Fort Collins when the Foothills mall
project was approved by council was $8.8M. Based on current trends, staff estimates the new
commitment level at $5.4M. Savings was driven by the bond closing at a lower rate (5.92% vs.
7%) and the lower pledged increment allowing more Metro District revenues to contribute to
bond reserve.
Ongoing revenue remitted back to the City will occur later and be less than originally forecasted.
This is driven by slower lease-up rate and lower sales per sq. ft. performance. Lower sales per sq.
ft. performance is driven by tenant mix, including more service based businesses than
anticipated.
UNet Taxable Sales Tax Trends
The City began facing a changing revenue situation beginning in 2017. A contributing factor to
this revenue trend is flat to modest sales tax revenue growth. Financial Services Area (Finance)
staff has begun to evaluate relevant data points and trends that might help to explain this shift
and support revenue forecasting. Staff presents several preliminary data points as an introduction
to this topic.
In the chart below, the City and County were following the same trendline until 2010. The
County compound annual growth rate (CAGR) outside the City, from 2010 to 2017 was 7.8%
while it was 4.4% in Fort Collins.
Year
Metro
District
Revenue
City Sales Tax
Revenue
Non-Pledged
Sales Tax
Pledged
Increment
Bond
Payments &
Reserve
Increment
Returned to City
City
Contribution
2012 4.8
2015 2.1 5.0 5.0 2.5 4.6 - 2.5
2016 2.3 5.3 5.3 3.1 5.4 - 3.1
2017 6.5 5.4 5.4 3.2 9.7 - 3.2
2018 6.5 8.8 5.5 3.3 6.0 3.3 -
2019 6.7 9.0 5.6 3.4 5.7 3.4 -
TOTAL 15.4 6.6 8.8
Original Assumptions
Year
Metro
District
Revenue
City Sales Tax
Revenue
Non-Pledged
Sales Tax
Pledged
Increment
Bond
Payments &
Reserve
Increment
Returned to City
City
Contribution
2012 4.8
2015 0.8 3.2 3.2 - 0.8 - -
2016 1.4 3.0 3.0 - 1.4 - -
2017 2.1 3.6 3.2 0.3 2.4 - 0.3
2018 4.9 4.9 3.8 1.1 5.9 - 1.1
In the chart below, the City’s percentage of County net taxable sales was consistently around
70% until 2010. Although net taxable sales in the City have been increasing since 2010, the
City’s percentage of the County’s net taxable sales has been declining.
Hypothesis:
• Fort Collins is no longer the retail hub of the County
• Leakage – residents shopping outside the City (Costco, Scheels, etc.)
• Potential shifting of buying behavior (ex: less disposable income)
Potential next steps:
• Investigate industry segment trends
• Consider rebalancing revenue sources – lodging, admissions
• Reevaluate land use decisions going forward
• Explore collecting tax on internet purchases (without nexus)
Net Taxable Sales Growth
Fort Collins Net Taxable Sales
ATTACHMENTS
1. Staff Presentation
1
Mall Performance Update & Net Taxable Sales Trends
Josh Birks, Victoria Shaw, & Jennifer Poznanovic
December 17, 2018
2
Mall Financial Performance Update
Overview
• Original projections were presented & approved in 2014
• Financing structure included 5 revenue streams
• Metro District Capital Mills
• Metro District Specific Ownership Tax
• Property Tax Increment
• Public Improvement Fee
• Sales Tax Increment
• Bond funded on and off-site construction
• Sales tax revenue is used only when needed
3
Year
Metro
District
Revenue
City Sales Tax
Revenue
Non-Pledged
Sales Tax
Pledged
Increment
Bond
Payments &
Reserve
Increment
Returned to City
City
Contribution
2012 4.8
2015 2.1 7.5 5.0 2.5 4.6 - 2.5
2016 2.3 8.4 5.3 3.1 5.4 - 3.1
2017 6.5 8.6 5.4 3.2 9.7 - 3.2
2018 6.5 8.8 5.5 3.3 6.0 3.3 -
2019 6.7 9.0 5.6 3.4 5.7 3.4 -
TOTAL 15.4 6.6 8.8
Original Assumptions
• Assumed 7% Interest Rate on Bond
• Fully open/operating 2016; Full returns beginning 2018
• Square footage 735K w/ Sales per sq. ft $350
4
Current Projections
• 5.92% actual interest rate
• Sq. Ft. 655K; w/ sales per sq. ft $300
• Returns starting 2021; Full returns 2022
5
Year
Metro
District
Revenue
City Sales Tax
Revenue
Non-Pledged
Sales Tax
Pledged
Increment
Bond
Payments &
Reserve
Increment
Returned to City
City
Contribution
2012 4.8
2015 0.8 3.2 3.2 - 0.8 - -
2016 1.4 3.0 3.0 - 1.4 - -
2017 2.1 3.6 3.2 0.3 2.4 - 0.3
2018 4.9 4.9 3.8 1.1 5.9 - 1.1
2019 5.0 5.7 4.1 1.5 6.6 - 1.5
2020 5.9 6.5 4.5 2.0 8.0 - 2.0
2021 5.9 6.7 4.5 2.1 6.4 1.7 0.5
2022 6.3 6.8 4.6 2.2 5.6 2.2 -
TOTAL 9.3 3.9 5.4
2018 Update
6
Net Taxable Sales Trends
Net Taxable Sales Growth
Percent Change
7
City and County Following Same Trendline until 2010...
County Growth Outside City CAGR 7.8% from 2010 to 2017
Net Taxable Sales Growth
City Percentage of Net Taxable Sales
Declining since 2010
8
Fort Collins Net Taxable Sales
Hypothesis & Next Steps
9
Hypothesis:
• Fort Collins no longer the retail hub of County
• Leakage - residents shopping outside the City (Costco, Scheels, etc.)
• Potential shifting of buying behavior – ex: less disposable income
Next Steps:
• Investigate industry segment trends
• Consider rebalancing revenue sources – lodging, admissions
• Reevaluate land use decisions going forward
• Explore collecting tax on internet purchases (without nexus)
Backup
10
Net Taxable Sales Growth
Percent Change
11
Year County Net
Taxable
County %
Change City Net Taxble
City %
Change
Non FTC Net
Taxable
Non FTC
% Change
2000 $2,638,657,809 $1,815,672,937 $822,984,872
2001 $2,834,436,200 7.4% $1,969,883,191 8.5% $864,553,009 5.1%
2002 $2,820,371,351 -0.5% $1,953,008,565 -0.9% $867,362,786 0.3%
2003 $2,815,362,620 -0.2% $1,970,900,747 0.9% $844,461,873 -2.6%
2004 $2,909,529,890 3.3% $2,026,460,716 2.8% $883,069,174 4.6%
2005 $2,999,600,605 3.1% $2,075,656,434 2.4% $923,944,171 4.6%
2006 $3,184,763,969 6.2% $2,208,697,178 6.4% $976,066,791 5.6%
2007 $3,271,959,813 2.7% $2,251,174,525 1.9% $1,020,785,287 4.6%
2008 $3,211,537,351 -1.8% $2,234,081,750 -0.8% $977,455,601 -4.2%
2009 $3,040,901,363 -5.3% $2,117,397,101 -5.2% $923,504,261 -5.5%
2010 $3,269,356,259 7.5% $2,206,123,542 4.2% $1,063,232,717 15.1%
2011 $3,438,941,928 5.2% $2,325,947,976 5.4% $1,112,993,951 4.7%
2012 $3,702,853,295 7.7% $2,451,893,790 5.4% $1,250,959,504 12.4%
2013 $3,853,075,797 4.1% $2,565,787,461 4.6% $1,287,288,335 2.9%
2014 $4,240,671,077 10.1% $2,778,942,994 8.3% $1,461,728,083 13.6%
2015 $4,593,025,618 8.3% $2,872,940,819 3.4% $1,720,084,800 17.7%
2016 $4,798,331,897 4.5% $3,035,261,752 5.6% $1,763,070,145 2.5%
2017 $5,056,443,283 5.4% $3,115,640,125 2.6% $1,940,803,158 10.1%
2018 YTD $3,019,263,433 7.6% $1,805,343,211 4.9% $1,213,920,221 11.8%
• From 2010 to 2018
YTD, Larimer
County net taxable
sales growth outside
Fort Collins has
been increasing on
average 5% more
than Fort Collins
What Accounts for this Shift?
Indicators Across the County
12
Net Taxable Sales Growth
2009:
‒ Timnath Walmart opened May
• Net taxable up 49% from ‘09 to ‘10
2011 to 2012:
• Windsor up 19%, Loveland up 11%
• Timnath up 11%, Fort Collins up 6%
• Hyde Park Fire June 2012
2014:
‒ Timnath Costco opened October
• Net taxable up 68% from ‘14 to ‘15
‒ Mall redevelopment started in 2013
• Sales down $24M from ’13 to’15
2016 & 2017:
‒ Sports Authority closed September 2016
‒ Johnstown Scheels opened October 2017
Population Growth
Consistent Across the County
13
CAGR 1990 – 2017
City: 2.27%
County: 2.19%
Non City: 2.12%
2019 5.0 5.7 4.1 1.5 6.6 - 1.5
2020 5.9 6.5 4.5 2.0 8.0 - 2.0
2021 5.9 6.7 4.5 2.1 6.4 1.7 0.5
2022 6.3 6.8 4.6 2.2 5.6 2.2 -
TOTAL 9.3 3.9 5.4
2018 Update