HomeMy WebLinkAboutAgenda - Mail Packet - 8/30/2022 - Council Finance Committee Meeting Agenda - September 1, 2022 (10)Finance Administration
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AGENDA
Council Finance & Audit Committee
September 1, 2022
4:00 - 6:00 pm
Zoom Meeting https://zoom.us/j/8140111859
Approval of Minutes from the August 1, 2022, Council Finance Committee meeting.
1.Sustainable Revenue Update 70 mins. G. Sawyer
J. Poznanovic
2. Annual Adjustment Ordinance 20 mins. L. Pollack
3. 2021 Fund Balance Review 30 mins. B. Dunn
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Council Finance Committee
Agenda Planning Calendar 2022
RVSD 08/23/22 ts
Sept. 1st 2022
Sustainable Revenue Update 70 min G. Sawyer
J. Poznanovic
Annual Adjustment Ordinance 20 min L. Pollack
2021 Fund Balance Review 30 min B. Dunn
Oct. 20th 2022
Hold: E. Mulberry Follow-ups 30 min
D. Lenz
S. Tatman-
Burruss
2023 Utility Rate Increases & MDM Appropriation Request 60 min L. Smith
Utilities Income-Qualified Assistance Program Structure 30 min H. Young
Nov. 3rd 2022
General Employee Retirement Plan (GERP) Annual Report 30 min B. Dunn
Financial Policy Updates 30 min B. Dunn
9/11 Memorial Park at Spring Park 30 min N. Bodenhamer
Dec. 1st 2022
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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
August 1, 2022, 4-6 pm
Zoom
Council Attendees: Kelly Ohlson, Emily Francis (Acting Chair), Shirley Peel, Susan Gutowsky
Absent: Julie Pignataro
Staff: Kelly DiMartino, Tyler Marr, Rupa Venkatesh, Blaine Dunn, Randy Bailey,
Logan Bailor, Trevor Nash, Amanda Newton, Jo Cech, Molly Reeves,
Gerry Paul, Ginny Sawyer, Josh Birks, SeonAh Kendall, Seve Ghose,
Victoria Shaw, Sylvia Tatman-Burruss, LeAnn Williams, Aaron Harris,
Janice Seager, Peggy Streeter, Rebecca Everette, Lance Smith, Javier Echeverria,
Dave Lenz, Sheena Freve, Tracy Ochsner, Brian Hergott, Jerod Cordell,
Zack Mozer, Dianne Lapierre and Ken Draves, Poudre Library District,
Carolyn Koontz
Others: Ann Hutchinson, Chamber
Molly Bohannon, Coloradoan
Chris Telli, CPA, FORVIS LLP
Haley King, CPA, FORVIS LLP
______________________________________________________________________________
Meeting called to order at 4:06 pm
Approval of minutes from the July 7, 2022, Council Finance Committee Meeting. Kelly Ohlson moved for approval of
the minutes as presented. Shirley seconded the motion. Minutes were approved unanimously via roll call by; Kelly
Ohlson and Emily Francis and Shirley Peel
A. Aquatics
Seve Ghose, Director, Community Services
LeAnn Williams, Director, Recreation
Victoria Shaw, Manager, FP&A
EXECUTIVE SUMMARY
The purpose of this work session is to provide updates since the March 22, 2022, council work session item on
the aquatics system, initiated from discussion on potential spending at Mulberry Pool and direction for the
Southeast Community and Innovation Center.
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GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Staff is seeking feedback from Councilmembers on the following options related to the proposed Southeast
Community Center and overall aquatics:
• OPTION #1: Build the Southeast Community Center with only the core amenities required to meet the ballot
language. This configuration would require an outdoor leisure pool and innovation piece and be located at
Fossil Creek Park. This option does not require any partnerships.
• OPTION #2: Meet the ballot language for the Southeast Community Center and address most significant
overall aquatics systems needs with the addition of indoor leisure aquatics and 10 indoor lap lanes. This
option requires partnerships with Poudre School District and Poudre River Public Library District to be
feasible.
• OPTION #3: Meet the ballot language for the Southeast Community Center, address the most significant
overall aquatics and recreation systems needs with the addition of indoor leisure aquatics,10 indoor lap lanes,
and a full-service community recreation center. This option requires partnerships with Poudre School District
and Poudre River Public Library District to be feasible.
Staff is also seeking feedback on the direction to continue to pursue a partnership with PSD for the potential use
of land adjacent to Fossil Ridge High School.
BACKGROUND/DISCUSSION
In 2015, voters approved a Community Capital Improvement Program (CCIP) which included adding a Southeast
Community Center with outdoor pool. The item outlined the Community Center would be focused on innovation,
technology, art, recreation, and the creative process. The center was projected to require $14M of CCIP funding
for construction and include a large outdoor leisure pool with water slides, sprays and jets, decks, a lazy river, and
open swimming area. Operations and maintenance costs of $230K per year for 5 years was also estimated in the
ballot item.
This facility will be run and programmed by recreation staff and add to the existing recreation aquatics offerings
across the City. The current aquatics system in Fort Collins features four facilities and is geographically
concentrated in the Northern region of Fort Collins, with no facilities south of Drake, as illustrated in the following
map:
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Regarding amenities, the existing system includes: Mulberry
Pool
Senior
Center Pool
City Park
Pool
Edora Pool
Lap Lanes
Family Aquatics
Therapy pool or programs
Competitive Aquatics
Center
50M Lanes
Instructional Programs
Indoor Pool
Outdoor Pool
In early 2022, staff worked with a consultant, Counsilman-Hunsaker, to study the existing aquatics system and
presented findings at the March 22, 2022, council work session meeting. Key findings included:
1. Need for aquatic amenities in the southeast quadrant of the city
2. Need for additional training (lap) lanes, 6 at current population and 8 based on 2025 projected population
3. Need for additional recreation water
4. Leverage the existing user group relationships to support the additional facilities and amenities
5. Additional investment in Mulberry pool not recommended
Based on feedback received during the work session item staff has continued to explore a “fair share” approach
to the aquatics system, and options to leverage existing user group relationships to support additional facilities
and amenities. Staff has identified potential opportunities to partner with Poudre School District and Poudre River
Public Library District, which would enhance the level of amenities that could be provided at the community center
and address community needs beyond the base ballot language. Potential pathways to move forward could
include:
1. Build the Southeast Community Center with only the core amenities required to meet the ballot language.
• This configuration would require an outdoor leisure pool and innovation piece and be located at Fossil
Creek Park.
• This option does not require any partnerships.
• Estimated project budget cost is $13.35M+
• Estimated operation costs are $1M/year with cost recovery from programming of 40%
2. Meet the ballot language for the Southeast Community Center and address most significant overall aquatics
systems gaps
• This option would add indoor leisure aquatics and 10 indoor lap lanes in addition to meeting the ballot
language.
• This option requires partnerships with Poudre School District and Poudre River Public Library District
to be feasible.
• Estimated construction costs are $42.95M+
• Estimated operation costs are $1.7M/year with cost recovery from programming of 47%
3. Meet the ballot language for the Southeast Community Center, address the most significant overall aquatics
system gaps, and build a full-service recreation facility
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• This configuration would add indoor leisure aquatics, 8-10 indoor lap lanes, and a full-service
community recreation center in addition to the ballot language.
• This option requires partnerships with Poudre School District and Poudre River Public Library District
to be feasible.
• Estimated construction costs are $56.6M+
• Estimated operation costs are $1.7M/year with cost recovery from programming of 77%
Exact configurations of amenities could be further refined and configured to target specific needs; however, these
options represent the tiers of facility which are under consideration. Additional components for consideration
include adjusting the number of gymnasiums, weight and fitness rooms, wet classrooms, preschool rooms, and
adding outdoor lap lanes or indoor turf.
The City currently owns land at Fossil Creek Park that could be used as a site for the location. A potential
partnership with Poudre School District for land and aquatics could expand opportunities for the location of the
facility. Partnership with the Poudre River Public Library District would expand ability for the facility to achieve the
ballot language focus of innovation, technology, art, recreation, and the creative process.
NEXT STEPS
Staff will bring an aquatics item to the August 23, 2022, council work session meeting.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Staff is seeking feedback from Councilmembers on the following options related to the proposed Southeast
Community Center and overall aquatics:
• OPTION #1: Build the Southeast Community Center with only the core amenities required to meet the ballot
language. This configuration would require an outdoor leisure pool and innovation piece and be located at
Fossil Creek Park. This option does not require any partnerships.
• OPTION #2: Meet the ballot language for the Southeast Community Center and address most significant
overall aquatics systems needs with the addition of indoor leisure aquatics and 10 indoor lap lanes. This
option requires partnerships with Poudre School District and Poudre River Public Library District to be
feasible.
• OPTION #3: Meet the ballot language for the Southeast Community Center, address the most significant
overall aquatics and recreation systems needs with the addition of indoor leisure aquatics,10 indoor lap lanes,
and a full-service community recreation center. This option requires partnerships with Poudre School District
and Poudre River Public Library District to be feasible.
Staff is also seeking feedback on the direction to continue to pursue a partnership with PSD for the potential use
of land adjacent to Fossil Ridge High School.
DISCUSSION / NEXT STEPS
Kelly Ohlson; we act like we have unlimited pots of money
It appears we get one next shiny object brought to us – one after another lacking context and the full
picture - not presenting opportunity costs to Council – what don’t we do if we do this
I am for pools and recreation centers and community centers, but we don’t have the funds.
I will have to see a lot of data and specifics;
1) How many regular Fort Collins residents (outside of teams) use indoor pools
- we are looking at between $80M - $100M in capital for two pools – a lot of money
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(other than the teams that relates to the cost recovery formula)
2) Community prioritization – especially when we look at the number of people who use parks and
what we need for parks refresh versus pools – I want to get the most bang for the buck - we don’t get
to have everything
We have gone from a $13M Community Center to $55M of city costs which is 4x
I want fairness in all of these proposals with our partners – in addition Council prioritization and usage
numbers (teams) if we partner with the school district and /or the library district - that they pay their
fair share based on their usage of the facility
I need details, details, details before we make any decisions
Who the partners may be and that they need to sign on to pay their fair share
We need to refresh parks - we can’t seem to maintain or improve what we have and now we are
talking huge numbers for pools.
I like the gross /net slide (see below)
When you bring us operational costs in the future, make sure we have a gross what we think the
income is and what the net will be
In a couple of the options, it appears that creative innovative center goes away - I thought that was in
the ballot language
LeAnn Williams; that is the partnership with the Library District – they are in the business of innovation
and makers space so that is their business, and they would do that with a partnership
Details, details, details,
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Agreements up front of who shares what costs based on fairness in all appropriate categories not just
construction or land swaps but in operations and maintenance too
Blaine Dunn; I forgot to mention at the top that this is an early look at the full aquatics picture and the
southeast community center. We are bringing this forward to a full work session on August 23rd so
We do want to hear all of your feedback about the facilities so we can work that information into what
we bring forward for that full work session.
Kelly Ohlson; thank you – you always get points by bringing things to committees or council early.
Any details you can add would be in your best interest if you want this to move forward
LeAnn Williams; we are having candid conversations with PSD about the fair share O&M - they have
heard about fair share loud and clear, and the library district as well is 100% on board with that as well
Shirley Peel; great presentation – very succinct and clear –
Can you remind me of the timeline on the ballot measure?
LeAnn Williams; there might be some flexibility on that which Seve or Blaine could address.
The plan was to be completed by 2025 because once all of the projects are complete it releases the
extra funding that is there, and they can go out for another new ballot measure
Design - late 2022 and 2023
RFP in 2023
Break ground end of 2023
Construction 2023 - 2024
Open end of 2024 or early 2025
Shirley Peel; is there a reason that we do outdoor pools in Colorado?
LeAnn Williams; people love them - lap swimmers love swimming outside most of the year
City Pool is often at capacity - there are 20 some HOA pools in our community that open us seasonally
Shirley Peel; regarding Mulberry - do we have a timeline on when CSU might be willing to partner?
LeAnn Williams; we have had quite a few discussions with them on the SE facility -they were very much at the
table as their Moby pool is older than Mulberry – there were talks of what the SE might look like but looking at
the cost and proximity it really didn’t make a lot of sense for them. We are happy to start conversations back up
regarding Mulberry – what their timeline is, the fair share partnership, does it make sense.
Shirley Peel; you mentioned all of the HOA pools – seems like there are a lot of private / HOA pools in this area
LeAnn Williams; I have a diagram of where all of the HOA pools are in the city and am happy to share that
diagram - I was going to put it in your council districts so you can each see what is in your districts
Shirley Peel; back to Kelly’s point of who actually uses all these pools?
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Who is going to use the pool in the SE if most HOAs already have pools?
I know that due to the ballot measure, it needs to be built in the SE but that would sway me to let’s’ do the basic
versus let’s do more - (use of the pool, the community center, the facility) looking at the return on our
investment
LeAnn Williams; based on the population in the community - we build for the folks in our community but believe
from a revenue standpoint that folks in surrounding communities (Timnath, Windsor, etc.) will also use the
facility. Most of the HOA pools are like backyard pools, rectangular pools with maybe 5 or so lap lanes used for
neighborhood swim teams, water 4-6 feet deep.
Shirley Peel; trying to be forward thinking and to get the biggest bang for our buck and not just focus on the
initial ballot language – it just comes down to money. We keep discussing this and decide what we have money
for. What other entities (partners) are willing to do.
Emily Francis; when we did the study of how many lap lanes we needed – HOAs and gyms were not included,
correct?
LeAnn Williams; correct, our consultants did not consider HOA or private pools like at Miramont.
Emily Francis; why didn’t they include them?
Seve Ghose; based on their national measures which are typically with the public sector pool- it is hard to get
numbers for private sector pools, so they don’t typically track those
Emily Francis; I understand but I don’t agree with them – for me – the context of the HOA and private pools is
important because I don’t think that a plan based on population is enough for me to support dramatically
increasing what we have in the ballot language. It is not just based on population, but on what amenities people
currently have access to and what they want to do. For me it is like when we discussed how many people have
access to yards and parks – the same thing – if folks already have access to pools – may have different uses but
pools are very expensive, and we need to be conscious of water usage as well so there has to be some give and
take -
How many pools are we building? What is our responsibility as a city to provide that given in the context of
people’s neighborhoods
SE Pool if Mulberry is open and rebuilt and that would meet the need?
LeAnn Williams; correct
City Park has zero lap lanes, but it is an outdoor aquatic facility
The map (see below) shows all city aquatic facilities. Sr. Center pool has a few lap lanes. Mulberry has a little
leisure and lap lanes. EPIC is lap lanes and a therapy pool and swim lessons which also happen at Mulberry. City
Park pool is an outdoor leisure pool complex.
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Emily Francis; how many dollars are we expecting from the ballot initiative?
LeAnn Williams; we asked for $15M of CCIP for the next BFO cycle.
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Blaine Dunn; the total capital amount from CCIP is $17.6M
Additional $1.1M in O&M once that is built
Emily Francis; how many Community Centers are we planning?
LeAnn Williams; I will get that information and circle back – it is in the Master Plan
Seve Ghose; the 2013 feasibility study identified the Southeast area as well
LeAnn Williams; we have been talking about the Southeast for 10 years
Emily Francis; I think it makes sense to combine the community center, library, and pool.
Better community building way to approach this. I also like the partnerships
I agree with my fellow committee members that the agreements, operations & maintenance, and everything
else is going to be pivotal in this moving forward.
We, as a community like to build the best, which is great for our community, but we don’t have the dollars to
continue to build at this level. Yes, a community center is needed, a pool is needed.
My concern is that things get so costly because we want to include everything.
How do we really distinguish between what is needed and what is wanted in the community?
Has a chain effect on a lot of other things we are talking about – does that prevent us from rebuilding Mulberry
or building another community center? More context is needed to make a decision because it does have a chain
effect on many other things.
Kelly Ohlson; context of we like all these things too
There was maybe 1 or 2 Council members who want more lap lanes. Include that context as you work on this.
We are in the business of counting support on things.
3rd renovation of the Mulberry Pool - all very costly
Complete scrap off and rebuilding to last another 50 years
In the neighborhood of $80M for the two pools – potential for 5-6 new pools on the 2 sites
Number of lap swimmers – not teams
We need details, details, details.
Fairness on the cost sharing with partners
How this meshes with parks refresh which cannot be lost in all of this
Opportunity costs / trade-offs – if we do some of these things it could mean less dollars for affordable housing
Adding 15 net new employees is $2M a year gross
LeAnn Williams; in response to Emily’s question – 2.1.1 in the Master Plan says construct the new southeast
recreation center and consider 2 other community or neighborhood centers to serve the community’s indoor
recreation needs.
Blaine Dunn; summary
• Good feedback on what to bring to the work session – additional data and numbers
• More details on the partnerships we are looking at
• Make sure we are accounting for all pools (HOA and private)
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B. Annual Financial Audit Results
Blaine Dunn, Accounting Director
Randy Bailey, Controller
Chris Telli, CPA, FORVIS LLP
Haley King, CPA, FORVIS LLP
SUBJECT FOR DISCUSSION
Independent Auditors’ Report on 2021 Financial Statements
Independent Auditors’ Report on Compliance for Major Federal Programs
EXECUTIVE SUMMARY
FORVIS will be presenting an overview of the Report to Council. This report covers the audit of the basic
financial statements and compliance of the City of Fort Collins for year-end December 31, 2021.
NOTE: The Annual Comprehensive Financial Report has been sent to the printer, but the printing has not yet
been completed. We will get hard copies distributed as soon as they are available, for those requesting one. A
copy of the report can be found online here:
https://www.fcgov.com/finance/files/2021_City_of_Fort_Collins_ACFR_GAGAS.pdf
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
Staff seeks input on areas of priority or concern, other than those established in this Report to the City Council,
for matters of recordkeeping and/or the City’s internal control environment.
Otherwise, there are no specific questions to be answered as this is a 2021 year-end report.
BACKGROUND/DISCUSSION
In compliance with Government Auditing Standards, the City undergoes an independent external audit on an
annual basis. FORVIS finalized its financial statement audit and compliance report on June 29, 2022, and the
firm is required to report the results of the audit to those charged with governance.
Attachment 2 to this agenda item contains the full report, findings of note are summarized below:
Other Findings (Attachment 2, pages 5-6):
Other findings/deficiencies identified by the auditors but not rising to the level of a significant deficiency can
be found in the Report to the City Council. Staff will provide a written response to the audit findings at a
fourth quarter Council Finance Committee meeting.
DISCUSSION / NEXT STEPS
Kelly Ohlson; does the Council Finance Committee get involved in selecting the auditing firm?
Blaine Dunn; we issued the RFP and then we make sure that all of firms that responded to the RFP met the
qualifications and could do the job. We need an audit firm that can bring enough manpower and knowledge to
the table to be able to perform the audit for us. We work with the Audit Committee to make the final decision
Before we issued the most recent RFP we had a code change that says we can only have the same auditor for 2
consecutive 5-year terms for a total of 10 years in order to get a fresh set of eyes every so often.
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Kelly Ohlson; I am very comfortable. 10 years is a stretch for me - I like fresh eyes after 5 years.
Directed to staff - I would like to see the summary of the first 3 years including the recommendations that you
were given that you didn’t respond to and why.
I agree that the Single Audit needs some attention. I also agree that the P-card issue needs to be taken more
seriously - I felt this needed more attention even before the library district issue. It was pointed out in 2020, but
we chose not to do anything about it. Why don’t we take the P-card recommendation more seriously?
Blaine Dunn; the p-card recommendation was actually to remove that portion of the p-card policy that we do
random audits because we have not been performing random audits. We did previously perform random audits
so that is why it was in there. The discussion now is that we could remove that portion, but we are not sure as
management that we want to remove that. We are determining if we want to restart our random audits and
what that might look like.
Kelly Ohlson; I thought they were recommending that you do the random audits.
Blaine Dunn; nuance in words – in 2020, the recommendation was to remove that language from the policy but
now, based on recent events, we are going back to do the random audits.
Kelly Ohlson; I would like to see the first 3 years of the recommendations - the ones we did not take - a few
sentences to be included with your 4th quarter report out.
Blaine Dunn; got it – no problem
Shirley Peel; I saw that staff received a certificate of excellence for last year’s finance report
Blaine Dunn; we have received that for the last 35 years
Shirley Peel; impressive - the percentages of errors is very low
I was concerned when I saw the technology review and the p-card audit and
I hope that we do take the recommendations seriously and that those concerns are addressed.
Blaine Dunn; when we bring back what has been done per our recommendations, we will work in conjunction
with our IT colleagues on recommendations they have made on that side and where they are with all of those
changes as well.
Emily Francis; they covered my questions, so I don’t have any additional issues.
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C. East Mulberry: Potential Annexation Lenses & Phasing
Dave Lenz, Director FP&A
EXECUTIVE SUMMARY
The purpose of this item is to provide Council with an overview of the potential annexation phasing lenses,
assumptions, and corresponding financial modeling of the East Mulberry enclave. Staff have been evaluating a
variety of possible approaches to a potential annexation and have developed five phasing lenses that encompass
an underlying set of priorities and can help determine the order of approach to a potential annexation.
These phasing lenses have been utilized to create alternative five potential annexation scenarios. The financial
implications of these scenarios have been modeled utilizing a fiscal impact modeling tool. Separate analysis has
been performed for both the Governmental and Utility sectors of the City organization. A 20-year timeframe
has been included as the base level of comparison across the scenarios. An additional 35-year analysis is also
provided to highlight the impacts of accelerating or de-accelerating the potential annexation process.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
• What aspects of each scenario would Council like to prioritize to further refine toward a potential future
annexation scenario?
• What questions remain for Council regarding potential annexation phasing and timing?
BACKGROUND/DISCUSSION
Phasing and Lenses
In order to facilitate a potential annexation evaluation, staff and outside consultants have divided up the East
Mulberry enclave area into five subareas. These “boundaries” have been formed based on existing conditions
and general land use designations. They are not specific recommendations but a necessary part of the exercise
to establish a set of different potential annexation options. The mapping of the subareas is highlighted below.
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Five phasing lenses have been created to articulate and depict the priorities, assumptions, and potential
“benefits” or “drawbacks” to each scenario based on previously stated priorities by Council, community
members, and City staff. Each of the scenarios includes a different sequencing and timing of all five subareas.
1. Economic Opportunity - Emphasizes economic development and vitality in the area
2. Residential Enhancement - Emphasizes connectivity, utilities, and other social priorities
3. Environment & Hazard Protection - Emphasizes environmental buffers, flood mitigation
4. Fiscal Health for City - Emphasizes fiscal impact to City of annexation, including existing priorities, risks, and
timing
5. Community Gateway - Emphasizes improvements and reinvestment potential for the Mulberry Corridor,
including the highway and frontage roads
These scenarios are theoretical and assume annexation within given periods of time. They can be adjusted by
changing the underlying assumptions to produce different results. None of these scenarios are meant to be
“staff recommendations” and are instead a starting point for conversation and analysis. More detail of on the
character of each scenario are detailed in the accompanying presentation materials.
Financial Impacts
For each of the five developed scenarios, the analysis presents a twenty-year timeframe and assumes
annexation of all areas within the enclave. Depending on the timing of when a particular sub-area is annexed
into the City, additional operating costs, capital, and asset management requirements will fall outside the
twenty-year timeframe.
Summary high level financial projections are highlighted below. This breakout shows the total 20-year revenue,
expense, and margin for both the governmental and utility sectors, in addition to average annual amounts over
the 20-year period.
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Additionally, the following detail and analysis is included in the presentation materials:
• Each scenario also has more granular detailed provided (Governmental Operating and Capital; Utilities
Operating and Capital). The twenty-year timeframe is divided into four 5-year periods (Immediate, Short
Term, Medium Term and Long Term).
• A more detailed twenty-year summary roll-up of the governmental and utility sectors is included as well.
• A 35- year alternative analysis highlighting the impacts of accelerating or de-accelerating the potential
annexation process.
Funding Considerations
Both the governmental and utility sectors will require additional funding to pursue a potential annexation. On
the governmental side, no specific identified source of funding is currently available. Consideration to existing
needs and council priorities will help inform the extent to which funding may be available in the future. On the
utility side, mechanisms are in place to pay for additional requirements brought on by potential annexations,
subject to impacts to existing projects and funding requirements, and the resulting impact to ratepayers.
Next steps
October: Tentative - Council Finance Committee – Touchpoint / Follow-up
November: Council Work Session – East Mulberry Plan Discussion / Financial Update
Jan/Feb ’23: Council Work Session – Draft East Mulberry Plan / Refined Assumptions
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
• What aspects of each scenario would Council like to prioritize to further refine toward a potential future
annexation scenario?
• What questions remain for Council regarding potential annexation phasing and timing?
DISCUSSION / NEXT STEPS
Kelly Ohlson; lots of information - well done – To clarify, we will consider phased annexation, we have not
agreed to phased annexation. You hired a consultant – I would like to start with trusting the numbers – I am
assuming staff looked at their methodology and vetted their numbers.
Dave Lenz; basically, they are creating the housing, the model – we engaged Economic Planning Systems early in
the process - over 2 years ago. We have been working on the assumptions, methodology, framework of how
they would evaluate this; number of businesses, development rates, how long it would take for parcels of land
to develop, and it is correlated with our base line data - How we provide those services today and what is costs
us to do that. We have done specific case studies for certain of our big areas; police services for example – how
many officers, investigators, total headcount would we need for these big areas. We laid that existing data, our
existing cost structure against the buildout and the particulars of those parcels of land and their existing
structures - we have worked with them to bat down the methodology that they have used in a number of other
places for potential annexation evaluations with a number of municipalities and entities on the front range and
across the county. It is a combination - that is their sweet spot – model building for this type of annexation.
Kelly Ohlson; how do the voluntary annexations throw this plan off?
Dave Lenz; status quo – it is going to be parcel by parcel – so as a parcel comes in and there have been
some that have happened since we started the evaluation – they basically excluded that out from the base of
what we are going to have to incrementally go and add – all of the boundaries that we have, imagine geo coding
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the whole area, moving parcels in and out and draw lines and if council decides to proceed with our further
evaluation of this annexation, these options – our lines, the boundaries are going to look different – part of that
will be we are going to decide to do an approach and part of it is that time will have marched on. So, over time
we will refresh assumptions with updated data and delineate those lines out so that we include things that are
going to come in or have comes in from the analysis of the incremental nature of what we would potentially
bring in.
Kelly Ohlson; if council would decide at a work session for example, we want to do scenarios 3 and 4 or
whatever and then all of a sudden some others voluntarily can come in that aren’t in those - how we work those
pieces of the puzzle?
Dave Lenz; it is still a planning study stage -if we get to the point where we want to pursue, things will get more
refined as we start to look at thinks like getting the area surveyed precisely for different subgroups then we
could parcel it out slightly differently - we aren’t there yet with that discussion or input from council.
Kelly Ohlson; staff is doing exactly what we asked for, if we were doing anything, it would be slow and careful,
incremental and we needed numbers. Thank you for scheduling enough time with Council Finance and with the
full Council. When you say 5-year increments, does that mean if it is in the medium range and there are two
geographic areas that they are both taking place in that 5-year timeframe?
Dave Lenz; that is right - we could pick a period for simplicity’s sake, we assume that they came in at the same
time kind of mid-pointed in there - we can move one forward and move one back, but they come in during that
timeframe. Between 0-5 years is immediate.
Kelly Ohlson; in the southwest annexation - some of the lines still aren’t underground – we make the decision
not to do that – are some staying in the REA, or we just didn’t get to it yet? Are those lines not going to be
undergrounded and we are going to let REA continue? Are they our lines? There are some stormwater issues
out there that haven’t been dealt with and I think we are going on 10 years since annexation.
Lance Smith; regarding the southwest annexation, we do intend on providing electric service to all those
customers. We have not provided service to all of those customers yet. We have yet to underground
equipment for some of the customers we have been providing service to. That is just a matter of us trying to get
there with all of the other capital work that we need to do and really the same applies to the stormwater there.
Kelly Ohlson; the last part of that was annexed in 2013 - at some point, some commitments and promises were
made.
Rebecca Everett: I will just note on the question regarding the stormwater infrastructure in that area. The
memo that we provided to council last week goes into more depth on some of the complexities, some of which
relate to a lack of development activity on the timeline that we expected originally in some of those areas where
there are the greatest deficiencies. A lesson learned from that area is that if we don’t have a more proactive
funding model in place to address some of those more regional deficiencies in stormwater infrastructure, it
could take a long time for development activity to piecemeal enough funding together to address those issues.
Some of it is the speed of development that has happened in some areas, and some is lack of a special
improvement district or URA or other funding sources for those improvements.
Kelly Ohlson; we have to be very careful with promises we make on East Mulberry and the timeframes.
Page 18 of 107
What we do is very complex, we need to proceed cautiously because it didn’t quite work out the way we
planned on the southwest annexation for valid reasons. I don’t know why existing rate payers should pay for
utility upgrades, electrical infrastructure to new annexations. I don’t’ understand how 90% of that is fair.
Opportunity costs - If we spend it here then we don’t spend it on affordable housing or parks refresh.
It’s that chart I would like to see about Council options. You say – ‘If we take one option, it will open land up for
new development’ that can be good or bad - I am talking about the fairness issues. I am not for using taxpayer
and rate payer dollars to give to private landowners - if they want to improve the infrastructure and the
stormwater in order to develop their property then that is their right – I am not interested in charging the
taxpayers or the rate payers for new development. It is not fair that our taxpayers, residents, and rate payers
pay millions of dollars in order to open up more land for development to the benefit of the private landowner.
I will be digging my heels in very strongly on that point.
Emily Francis; I am interested in what we have done historically with land development and utilities.
Lance Smith; we have done both - the southwest annexation was a non-voluntary annexation. $3M of the fees
spread across existing rate payers across the city. Typically, when it is a voluntary annexation, we only spread
fees within the annexed area. Voluntary or non-voluntary, it is up to council’s discretion.
Emily Francis; I would like more information on why those decisions were made and what were the impacts.
What we have seen and learned from this both ways. It was a great presentation - so much information that
there is not a clear story or trade off or things to consider.
Dave Lenz; it is more, what would we as a council want to focus on from a priority standpoint. We want to solve
or work on affordable housing, or we want to work on transit. What we have right now is representative of how
we think it would look but we don’t have the specifics.
How much do we think it is going to cost? We can refine that by saying that we want to focus on the transit
corridor and stormwater then we can go back and sharpen our pencils and create something that is more
realistic around things Council would like to solve. Focus on specific priority that is where we are saying focus on
priorities. You are right, this is a lot of information. For example, saying we want a residential spur from the
residential area in the southeast to the industrial area in the northwest – we want to connect that via transit.
What does that look like in terms of actual dollars? We can come back with refined scenarios with a lot less
cases.
Emily Francis; It would be helpful for us to know where there are red flags. For example, if you go down this
path, this is what you are going to have to consider and here are the tradeoffs or this option is more fiscally
responsible, but you may not get the outcomes that you want. How do we layer together the story of fiscal
impacts to the city, the risks we are taking and the benefits we could get and / or negative consequences.
That would help inform a decision. If we wanted to prioritize housing and transit – these huge things over 20
years - is there an option for us to look at that is more of a blended approach? More staging in - we don’t want
people to move in there and then we have stormwater issues, no transit, and no businesses to support the
people living there. How do you blend scenarios together, so they come together in a more gradient approach.
Dave Lenz; that would be marrying those two things; a place to live and a way to get there.
Let’s create an area where that would be a geography that we could focus on – do a plan on how you would
achieve that - approach on a geographical basis. Match priorities together – put some more specific programs
to those things – then what does that look like? We need prioritization – again we can align to the existing
priorities – and this adds in this additional boundary – some of the things we can do will match up like regional
transportation and greater good things we are already doing – meshed in very well for an existing effort.
Page 19 of 107
Emily Francis; even though we have so much information, I am still not hearing… ok, so let’s say we want to
prioritize neighborhoods / housing so what are the tradeoffs with that? With each one, there are also negatives
to think about. The approach I would like is balanced, phased in, a community and human based approach.
Dave Lenz; I am getting a good picture of what you are looking for. We have been working on the East Mulberry
plan, scenarios, what it is going to cost. So, it is really bringing that plan of potential annexation scenarios a little
more together so we can flesh out a plan that addresses the priorities we want for this area.
Define risk
Define financial need
Define what could happen.
The consequences of not having unlimited dollars to do something - it takes time.
Communication, expectations, long time planning horizons are very important to this.
We started southwest a long time ago and we aren’t done. Mulberry is bigger and more complex.
We do need to have that target and vision of what we are wanting to head toward and the realization that we
have to adjust along with other priorities.
Shriley Peel; a lot of my questions are out in the weeds, things that will be flushed out as this moves forward.
I do like the way you laid out the different scenarios. It was very helpful to me to see the dollar amounts.
I would like to see more of a guiding principle that would include which one is the most economically feasible,
which one causes the least hardship and disruption with the most benefits to the residents. Which one fits in
best with our plans? If we could use that as our guiding framework. Looking at South College, it didn’t seem like
that kind of framework was there or maybe it just didn’t flesh out that way.
To Rebecca Everette - I did read the South College report – it was very well done and was very helpful for me. I
appreciate that. I hope we are going to address the issues that arose with South College annexation before we
jump into this Mulberry annexation.
Dave Lenz; the lessons learned are reflected in our approaches to how we want to do this.
That is why we want to do a phased approach and why we want to go slow. We need to show long term
horizons and be careful about what our ability to deliver on commitments is from a financial constraint
perspective and realize that we have a lot of other priorities. We are in the early stages of planning on this - we
are going slow at the pace we think you want/
Kelly Ohlson; I want to support Emily’s idea – this is not easy stuff - you start with the numbers
The next time this is brought to the Council Finance Committee, we would like some words to match the
numbers. You can see what our priorities are – these are some positives, some negatives, tradeoff, unknowns/
This is the good stuff we want – this is what we might give up with this scenario. Starting with the number is the
right way - now we need to see it in descriptive terms what those numbers might mean.
Blaine Dunn; right now, we have a tentative hold to bring this back to Council Finance in October before
a full work session.
Summary
• Defining trade offs
• Guiding principals
• How different tradeoffs might affect council priorities
• The opportunity costs that this might present with the current priorities and what we be wanting to do
elsewhere in the city
Page 20 of 107
• Some additional information on any impacts to rate payers
• Provide words to match the numbers
• Start to build some context around the annexation options and what that looks like in terms of services
Meeting adjourned at 6:40 pm
Page 21 of 107
Page 22 of 107
1
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Ginny Sawyer, Sr. Project Manager
Jennifer Poznanovic, Sr. Revenue Manager
Date: September 1, 2022
SUBJECT FOR DISCUSSION: Sustainable Funding Update
EXECUTIVE SUMMARY
The purpose of this item is to further refine possible new revenue models and to seek direction
on best use of the upcoming December Work Session on revenue.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
1. Does CFC want to recommend or eliminate any of the models presented?
2. Does CFC agree with proposed Work Session direction and questions?
3. What additional information should be included at the Work Session in December?
BACKGROUND/DISCUSSION
Over the past several years, masterplan developments and updates have identified clear
funding needs in the areas of parks and recreation, transit, and housing. Along with these needs
and the criticality of the City climate action goals, Council Finance Committee has asked for
climate funding needs to be included in funding conversations. Annual shortfalls range from six
to twelve million per area.
Funding needs identified and discussed previously include:
• Parks & Recreation - $8 to $12M annual shortfall (Parks & Recreation Master Plan)
• Transit - $8M to $10M annual shortfall (Transit Master Plan)
• Housing - $8M to $9.5M annual shortfall (Housing Strategic Plan)
• Climate - $6M+ annual shortfall (Our Climate Future Plan)
Staff continues to work with CFC to further refine both the needs and the potential funding
mechanisms to close the gaps. This work includes on-going Council Finance meetings, Work
Sessions with the full Council, developing an engagement plan, and ultimate implementation.
Discussions and feedback to date have highlighted a desire to:
• Clearly define and articulate revenue needs and level of service considerations.
• Thoroughly research funding options including impacts and the context of existing and
potential new tax measures (local and regionally.)
• Work to keep overall resident impact and tax burden as low as possible.
• Consider existing dedicated tax renewals and associated election timelines in a strategic
manner.
Timeline:
Page 23 of 107
2
To date:
• December 2021:
o Begin discussions on identified funding gaps.
• January 2022:
o Deeper dive with CFC on the projected gaps in each area.
• March 2022:
o Meet with CFC to review all possible revenue mechanisms.
• April 2022:
o Full Council work session to review work to date.
• June 2022:
o CFC to discuss most feasible funding mechanisms and targeted funding
amounts.
• September 2022:
o CFC to refine various funding models and considerations for addressing gaps
and seek direction on the best use of the December Council Work Session.
o
Future:
• Refine acceptable funding mechanisms and how to direct funding.
• Determine election cycle for which, if any, any voter approved mechanisms.
• Engagement efforts.
Potential Funding Mechanisms
Numerous potential funding mechanisms have been discussed with CFC. Of those discussed
previously, sales tax, property tax and excise taxes have emerged as the most feasible. The
table below demonstrates the potential revenue gain along with any annual impact to residents.
Page 24 of 107
3
The mechanisms above include both taxes and fees. Taxes require voter approval and can be
used for any public purpose authorized by City Council. Fees do not require voter approval and
they can only be imposed on those likely to benefit from the service funded with the fee.
Targeted Funding Option Considerations
In June, staff drafted five scenarios which targeted a diversity of funding sources totaling
amounts between $10M and $40M. These scenarios were not intended to be final or
recommended options. They were intended to demonstrate the flexibility and variable means
and ways to add additional revenue to cover the identified gaps. CFC supported potential
revenue ranges of $25 to $35M.
From those five models, three are included in these materials. Total revenue amounts vary from
$25M to $34M with anticipated impacts to residents ranging from $95 annually to $215 annually.
The models focus on property tax, sales tax, excise tax, and a possible user fee.
The potential of an emitter tax/fee has not been included but will be added as a policy question
to a future CFC meeting.
Staff has also included information for consideration on which funding mechanisms may be best
targeted to particular funding needs.
Proposed Next Steps
• Council Work Session December 13, 2022.
• February CFC meeting to review and discuss election cycles.
• Schedule additional conversation on carbon incentives/penalties?
ATTACHMENTS (numbered Attachment 1, 2, 3,…)
1. Sustainable Funding Update (PPT)
Page 25 of 107
09-01-2022
Council Finance Committee
SUSTAINABLE FUNDING UPDATE
Page 26 of 107
2WORK TO DATE
Dec. CFC Jan.
CFC
Mar.
CFC
April
Council
Work
Session
•Deep-dive on Identified
Needs: Parks & Rec,
Transit & Housing
Sustainable Funding Work-to-Date
Dec.
Council
Work
Session
•Funding Mechanisms
and Potential
Funding Levels
June
CFC
Sept.
CFC
•Introduction of
Topic: Sustainable
Revenue
•Funding
Mechanisms & Early
Scenario Planning
•Work Session
Direction and
Questions
•Election options will
be known for timeline
considerations
Page 27 of 107
IDENTIFIED FUNDING NEEDS 3
Masterplan Projects
$8-12M Annual Gap
Masterplan to Build Out
Projects
$8-10M Annual Gap
To Achieve 10%
Affordable Housing Stock
$8-9.5M Annual Gap
PARKS TRANSIT HOUSING CLIMATE
To Accelerate Community
Transition From Fossil
Fuels
$6M+ Annual Gap
Annual Revenue Gap
$30M to $38M+
Page 28 of 107
4MECHANICS & RESIDENTIAL IMPACT
Category Funding Mechanism Annual Revenue
Estimate Resident Impact
Sales Tax ¼ Cent Sales Tax
(dedicated, ongoing or repurpose)$9M+
•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
•Visitors also impacted
Property Tax 1 Mill Property Tax $3.5M •Residential annual increase of $21.45
•Commercial annual increase of $87.00
2 Mill Property Tax $7M •Residential annual increase of $42.90
•Commercial annual increase of $174.00
3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$5 per $100 purchase in Fort Collins
•Visitors also impacted
User Fee $5 Monthly User Fee $4M •$60 annually/resident
$10 Monthly User Fee $8M •$120 annually/resident
Commercial User Fee TBD •TBD for commercial properties in Fort Collins
Capital
Expansion Fee Reconfigure/ Broaden Application $2M •Net neutral for residential and commercial permit fees Page 29 of 107
5POTENTIAL REVENUE RANGES
$30M to $40M
Additional Revenue
$10M to $20M
Additional Revenue
$20M to $30M
Additional Revenue
$18M to $28M
Remaining Gap vs.
Master Plans
$8M to $18M
Remaining Gap vs.
Master Plans
$0M to $8M
Remaining Gap vs.
Master Plans
Page 30 of 107
6MODEL A: $20M to $30M
Category Funding Mechanism Annual Revenue
Estimate Stakeholder Impact
Sales Tax ¼ New Cent Dedicated Sales Tax $9M+•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
Property Tax 3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$5 per $100 purchase in Fort Collins
•Visitors also impacted
Total Sales Tax 4.1%$25M •$95 net annual increase per resident +
impact of excise tax
Page 31 of 107
7MODEL B: $20M to $30M
Category Funding Mechanism Annual Revenue
Estimate Stakeholder Impact
Sales Tax ¼ Cent Repurposed Sales Tax $9M+•Net neutral
3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$5 per $100 purchase in Fort Collins
•Visitors also impacted
User Fee $10 Monthly User Fee $8M •$120 annually/resident
Commercial User Fee TBD*•TBD for commercial properties in Fort Collins
Total Sales Tax 3.85%$25M**•$184.35 net annual increase per resident
*TBD targeting full replacement of existing ¼ cent tax
**”New” funding toward four priorities
Page 32 of 107
8MODEL C: $30M to $40M
Category Funding Mechanism Annual Revenue
Estimate Stakeholder Impact
Sales Tax ¼ Cent Dedicated Sales Tax $9M+•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
¼ Cent Repurposed Sales Tax $9M+•Net neutral
Property Tax 3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$5 per $100 purchase in Fort Collins
•Visitors also impacted
$10 Monthly User Fee $8M •$120 annually/resident
User Fee Commercial User Fee TBD*•TBD for commercial properties in Fort Collins
Total Sales Tax 4.1%$34M**•$215 net annual increase per resident
*TBD targeting full replacement of existing ¼ cent tax
**”New” funding toward four priorities
Page 33 of 107
9CONSIDERATIONS
Mechanism Revenue Use Variables
Sales Tax $9M+Parks & Recreation Broad support. Clear narrative.
Affordable Housing Support. More than triple historical funding. Advances climate
action.
Transit Support. Initial years fund capital. Later years fund operations.
Advances climate action.
Property Tax $11M to $14M Parks & Recreation Broad support. Can tie housing valuation directly to proximity to
parks.
Affordable Housing Support. More than triple historical funding. Advances climate
action. Can tie housing need to existing housing supply.
Transit Support. Initial years fund capital. Later years fund operations.
Advances climate action. Direct linkage to property tax not
required and harder to connect to transit.
Excise Tax $5M Parks & Recreation
Affordable Housing
Transit
Climate
Can select a product directly related to one of the focus areas to
advance goal (i.e. sporting equipment/P&R; Plastics/Climate; Auto
related/Transit) or can select any product and state where funding
will go (i.e. cannabis)
User Fee $9M Street Maintenance Fee must benefit fee payer. This would be used to off-set current
dedicated street maintenance tax and allowing “re-purposing” of
the dedicated tax.Page 34 of 107
10
Annual Gap ($M)Operations & Maintenance
(Daily Tasks)Infrastructure Replacement
Parks $1.0 $8.2
Recreation $0.0 $2.3
Planting Refresh $0.6
Total $1.0 $11.1
Parks and Recreation: $9M –$12M
Operations and Maintenance -the daily tasks needed to keep parks and recreation facilities running and
minor repairs to capital assets to keep them in a good state of repair, such as water management, turf care,
trash & recycling in parks.
Infrastructure Replacement (Capital)- Critical maintenance or repair of existing assets, can also include
strategic changes to existing parks or recreation facilities and design elements
•Smaller replacements, like replacements of courts or playgrounds, typically require one-time funding
and are not likely to increase annual operations and maintenance costs.
•Can also include strategic changes to existing parks or recreation facilities and design elements that
may trigger slight increases in annual operations and maintenance costs.
•$11M annual gap include recreation needs Page 35 of 107
11Transit Funding Need $8M -$10M
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040
Base Funding Operations - Local Match Capital Project - Local Match
Additional Anticipated Federal Funds Current Level of Funding New Level of Funding
~$17.5M
(2019 operating
budget)
~$8M -$10M
•The area between the lines represents new funds needed to build & operate the TMP
•A significant amount of federal grant funding is anticipated: current assumed matches range from 80/20 to
50/50 (grant/local)
•Capital projects will be the initial focus with service levels increasing as capital projects are completed
•Some service level increase is anticipated due to population growth, higher frequency routes, and route
extension
Page 36 of 107
12What Could Dedicated Housing Revenue Fund?
Expand the City’s competitive process to better
support projects seeking to: Acquire land, develop
housing, preserve existing housing, support
residents.
Examples:
•Housing acquisition
(redevelopment/preservation)
•Land acquisition
•New construction costs
•Affordable homeownership renovation
•Renovation of affordable rental housing
•Homeownership assistance
Expand or initiate City-led efforts as identified in
adopted policies including the Housing Strategic
Plan, City Strategic Plan, and HUD Consolidated
Plan.
Examples:
•Land Bank acquisition (expand)
•Extend affordability restrictions
•Fee credits for qualifying projects (expand)
•Develop incentive programs (energy efficiency,
voluntary affordability restrictions, etc.)
•Explore redevelopment partnerships
•Other innovative approaches (middle income,
mixed income, etc.)
Accelerate Implementation of the Housing Strategic Plan
Page 37 of 107
13Climate
2030 Projection –Community Carbon Inventory
•Key Pathways
•Platte River committed to 100%
renewable electricity by 2030
•Reduced petroleum use (vehicles)
•Diversion of organic waste
(universal composting)
•Reduced natural gas use (buildings)
Natural gas
Petroleum
Organic
waste
Page 38 of 107
14ELECTION TIMELINE OPTIONS
2023 2024 2025 2026
•April & November •November •November
Election Timeline Options (TBD following 2022 November election)
•April & November
Street Maintenance and Community Capital Taxes expire December 31, 2025.
November 2024 and April 2025 would be traditional elections to target for renewal.
Page 39 of 107
NEXT STEPS
Upcoming Council Work Session
•December 13, 2022
Council Finance Meeting
•February 2023 to determine preferred
election cycles
•Schedule an agenda item on carbon
incentives/penalties
15
Page 40 of 107
16COUNCIL FINANCE COMMITTEE DIRECTION
How to best utilize December 13th Council Work Session:
1.Does CFC want to recommend or eliminate any of the models presented?
2.Does CFC agree with proposed Work Session direction and questions?
3.What additional information should be included at the Work Session in December?
________________________________________________________________________
Upcoming Work Session Purpose & Outcomes:
Background and models for new revenue.
Questions:
1.Does City Council support any of the models presented?
2.Does City Council have questions or suggestions related to the pairing between revenue
mechanism and funding need?
3.What other questions does City Council have?
Page 41 of 107
Page 42 of 107
18
Backup
Page 43 of 107
19POTENTIAL FUNDING OPTIONS
Mechanism Annual Revenue
Projection
Impact to
Residents
1 Special districts (Library District Mill Levy 3.0)$11M+Business, Resident
2 Property tax (Library District Mill Levy 3.0)$11M+Business, Resident
3 Large emitters fee $11M+Business
4 ¼ cent sales tax base rate increase $9M+Resident, Visitor
5 ¼ cent additional dedicated sales tax $9M+Resident, Visitor
6 Repurpose ¼ cent dedicated tax $9M+Resident, Visitor
7 Excise tax on specific goods $5M Resident, Visitor
8 Business occupational privilege tax ($4 monthly/$48 annually)$4M+Business
9 Tax on services (i.e., haircuts, vet service, financial services, etc.)$4M+Business, Visitor
10 User Fees (parks, transit) ($5 monthly fee/ $60 annually)$4M Resident
11 Reconfigure capital expansion fees (Affordable housing)$2M Business
12 Establish new capital expansion fees (Affordable housing)$2M Business
13 Carbon Tax $2M BusinessPage 44 of 107
20OPTION D: $10M to $20M
Category Funding Mechanism Annual Revenue
Estimate Stakeholder Impact
Sales Tax ¼ Cent Sales Tax
(dedicated, ongoing or repurpose)$9M+
•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
•Visitors also impacted
Property Tax 1 Mill Property Tax $3.5M •Residential annual increase of $21.45
•Commercial annual increase of $87.00
2 Mill Property Tax $7M •Residential annual increase of $42.90
•Commercial annual increase of $174.00
3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$5 per $100 purchase in Fort Collins
•Visitors also impacted
User Fee $5 Monthly User Fee $4M •$60 annually/resident
$10 Monthly User Fee $8M •$120 annually/resident
Commercial User Fee TBD •TBD for commercial properties in Fort Collins
Total Sales Tax 3.85%$15M •$162.90 net annual increase per residentPage 45 of 107
21OPTION E: $10M to $20M
Category Funding Mechanism Annual Revenue
Estimate Stakeholder Impact
Sales Tax ¼ Cent Dedicated Sales Tax $9M+•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
¼ Cent Ongoing Sales Tax $9M+•$30.67 average per/year for a resident
•Sales tax on food would remain at 2.25%
¼ Cent Repurposed Sales Tax $9M+•Net neutral
Property Tax 1 Mill Property Tax $3.5M •Residential annual increase of $21.45
•Commercial annual increase of $87.00
2 Mill Property Tax $7M •Residential annual increase of $42.90
•Commercial annual increase of $174.00
3 Mill Property Tax $11M+•Residential annual increase of $64.35
•Commercial annual increase of $261.00
Excise Tax 5% Tax on Specific Goods $5M •$3 to $5 per $100 purchase in Fort Collins
•Visitors also impacted
User Fee $5 Monthly User Fee $4M •$60 annually/resident
$10 Monthly User Fee $8M •$120 annually/resident
Commercial User Fee TBD*•TBD for commercial properties in Fort Collins
Total Sales Tax 3.85%$14M**•$120 net annual increase per resident
*TBD targeting full replacement of existing ¼ cent tax
**”New” funding toward four priorities
Page 46 of 107
22MECHANICS & CONSIDERATIONS
Funding Option Mechanics Considerations
Property Tax
•A mill is 1/10th of a penny
•$1.00 revenue for each $1,000 of assessed value
•Residential assessment rate = 7.15%
•Commercial assessment rate = 29.0%
•Voter approval required
•Less Volatile than Sales Tax
•Current City mill levy of 9.797 not increased since 1992
•Property values have increased; not the City’s mill levy
Sales Tax
•Increase sales tax by ¼ cent
•Captures revenue from residents & visitors
•Voter approval required
•Funded by both residents & visitors
•Volatile during a recession
Excise Tax
•An excise tax is a legislated tax on specific goods or
services at purchase such as fuel, tobacco, and alcohol
•City of Boulder implemented a sugar sweetened beverage
tax of $0.02 per fluid ounce in 2016; Fort Collins estimate
of $4M+
•Other potential products: Beverages in plastic containers,
marijuana
•Voter approval required
•Revenue impacted by sales/recession
User Fee
•Monthly fee applied to residential & commercial utility bill
•Fees must be reasonably related to the actual cost of the
program or service funded by the fee
•Voter approval NOT required
•Flat fee would have disparate impact on residents with lower
income levels
Capital
Expansion Fee
•Fees are collected for the purpose of funding additional
improvements required to address the impact of growth
within the city as population increases
•Voter approval NOT required
•Reconfigured fees do not fall within the current standard
models for capital expansion fees Page 47 of 107
23Tax Rate History
Expiring 12/31/2025:
•¼ cent Street Maintenance
•¼ cent CCIP
3.85%
Current City
Sales Tax rate
2.85%
Page 48 of 107
24
Colorado City & County Tax Rates
by Population
*All counties except Douglas and Larimer have other taxes that include transportation, culture and public safety
County Population Total County
Mill Levy
State
Rate
County
Rate
Other Sales
Taxes
City
Rate Seat *Total Seat
Rate
El Paso County 730,395 7.692 2.90 1.23 1.00 3.07 Colorado Springs 8.20
Denver County 715,522 --2.90 0.00 1.10 4.81 Denver 8.81
Arapahoe County 655,070 13.013 2.90 0.25 1.10 3.00 Littleton 7.25
Jefferson County 582,910 24.578 2.90 0.50 1.10 3.00 Golden 7.50
Adams County 519,572 26.897 2.90 0.75 1.10 3.75 Brighton 8.50
Larimer County 359,066 22.458 2.90 0.80 0.00 3.85 Fort Collins 7.55
Douglas County 357,978 19.274 2.90 1.00 0.00 4.00 Castle Rock 7.90
Boulder County 330,758 24.771 2.90 0.99 1.10 3.86 Boulder 8.85
Weld County 328,981 15.038 2.90 0.00 0.00 4.11 Greeley 7.01
Mesa County 155,703 11.703 2.90 2.00 0.37 3.25 Grand Junction 8.52
Page 49 of 107
25
Colorado City Full Stack
Sales Tax Rates
0.0
1.0
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4.0
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9.0
10.0
Boulder Denver Grand
Junction
Brighton Colorado
Springs
Castle Rock Fort Collins Golden Littleton Greeley
Total Tax Rates
State County Rate Other Taxes City RatePage 50 of 107
26Fort Collins Net Taxable Sales
0%
10%
20%
30%
40%
50%
60%
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100%
$0
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021Millions
City Net Taxble City % of County Sales
Page 51 of 107
Page 52 of 107
Page 1
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Lawrence Pollack, Budget Director
Travis Storin, Chief Financial Officer
Date: September 1, 2022
SUBJECT FOR DISCUSSION
First Reading of Ordinance No. , 2022, Making Supplemental Appropriations and Authorizing Transfers
of Appropriations in Various City Funds.
First Reading of Ordinance No. , 2022, Appropriating Prior Year Reserves in Various City Funds.
EXECUTIVE SUMMARY
The purpose of these Annual Adjustment Ordinances is to combine dedicated and unanticipated
revenues or reserves that need to be appropriated before the end of the year to cover the related
expenses that were not anticipated and therefore, not included in the 2022 annual budget appropriation.
The unanticipated revenue is primarily from fees, charges, rents, contributions and grants that have been
paid to City departments to offset specific expenses.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
• What questions or feedback does the Council Finance Committee have on the 2022 Annual
Adjustment Ordinance?
• Does the Council Finance Committee support moving forward with bringing the 2022 Annual
Adjustment Ordinance to the full City Council?
BACKGROUND/DISCUSSION
These Ordinances appropriate unanticipated revenue and prior year reserves in various City funds and
authorizes the transfer of appropriated amounts between funds and/or projects. The City Charter permits
the City Council to appropriate unanticipated revenue received as a result of rate or fee increases or new
revenue sources, such as grants and reimbursements. The City Charter also permits the City Council to
provide, by ordinance, for payment of any expense from prior year reserves. Additionally, it authorizes the
City Council to transfer any unexpended appropriated amounts from one fund to another upon
recommendation of the City Manager, provided that the purpose for which the transferred funds are to be
expended remains unchanged; the purpose for which they were initially appropriated no longer exists; or
the proposed transfer is from a fund or capital project account in which the amount appropriated exceeds
the amount needed to accomplish the purpose specified in the appropriation ordinance.
If these appropriations are not approved, the City will have to reduce expenditures even though revenue
and reimbursements have been received to cover those expenditures.
The table below is a summary of the expenses in each fund that make up the increase in requested
appropriations. Also included are transfers between funds and/or projects which do not increase net
appropriations, but per the City Charter, require City Council approval to make the transfer. A table with
the specific use of prior year reserves appears at the end of the AIS.
Page 53 of 107
Page 2
A. GENERAL FUND
1. Security Classes provided by Emergency Preparedness and Security (EPS)
Revenue collected from security class participants is intended to help offset the cost of providing security
training from FRCC for a 3-day Crime Prevention Through Environmental Design (CPTED) class in April
and a 5-Day CPTED training in August 2022. This request includes revenue collected between
December 2021 - July 2022 and helps offset all class incurred expenses for 2022. This model uses initial
investment to prime the pump, using collected fees to supplement ongoing training.
FROM: Prior Year Reserves (2021 class revenue) $13,621
FROM: Unanticipated Revenue $14,290
FOR: Security Classes $27,911
2. Land Bank Operational Expenses
This request is intended to cover expenses related to the land bank property maintenance needs for
2022. Since expenses vary from year to year, funding is requested annually mid-year to cover these
costs. Expenses in 2022 include general maintenance of properties, raw water and sewer expenses,
electricity, repairs, and other as applicable.
FROM: Prior Year Reserves (Land Bank reserve) $2,750
FOR: Land Bank Expenses $2,750
3. Fort Collins Police Services (FCPS) has received revenue from various sources. A listing of these
items follows:
a. $36,516 – 2022/2023 BATTLE Grant (Beat Auto Theft Through Law Enforcement) Grant: Police
Services was awarded a grant from the Colorado State Patrol to help prevent auto theft in Colorado.
b. $44,805 – 2022/2023 Black Market Marijuana Grant: Police Services was awarded the Marijuana
grant to support the investigation and prosecution of black market or illegal marijuana cultivation
and distribution in the city.
c. $75,152 – 2022 Body Worn Camera Grant: In December of 2021, Police Services was awarded a
grant to help fund the upgrade of body worn cameras because of the passing of HB 21-1250.
This item is to appropriate the money that was received in 2022.
d. $11,400 - 2022 Click it or Ticket Grant: In 2021 Police Services was awarded a Click it or Ticket
Grant from the Colorado Department of Transportation to pay for officers to work overtime to
conduct enforcement activities.
Funding Additional
Revenue
Prior Year
Reserves Transfers TOTAL
General Fund $648,888 $692,164 $0 $1,341,052
Data & Communications Fund 0 12,500 0 12,500
Equipment Fund 625,793 48,064 0 673,857
Sales & Use Tax Fund 0 0 48,076 48,076
Natural Areas Fund 48,076 0 0 48,076
Golf Fund 0 368,348 0 368,348
CCIP Fund 0 0 25,000 25,000
Cultural Services Fund 25,000 0 0 25,000
Water Fund 80,000 0 0 80,000
Light & Power Fund 4,500,000 0 0 4,500,000
Transportation Services Fund 442,094 0 0 442,094
GRAND TOTAL $6,369,851 $1,121,076 $73,076 $7,564,003
Page 54 of 107
Page 3
e. $7,868 - 'Contribution to Northern Colorado Drug Taskforce: As a part of the City of Fort Collins
contribution to the Northern Colorado Drug Taskforce, any Drug Offender Surcharge, or Court
Ordered Restitution that is remitted from Larimer County Court to Fort Collins Police, is then
passed along to the NCDTF. Any additional restitution that is collected by FCPS is additionally
passed along to the NCDTF.
f. $11,400 - 2021/2022 High Visibility Enforcement (HVE) Grant: Police Services was awarded a
grant from the Law Enforcement Assistance Fund to pay for overtime for DUI enforcement.
g. $15,000 – 2022/2023 HVE Grant: Police Services was awarded a grant from the Law
Enforcement Assistance Fund to pay for overtime for DUI enforcement
h. $7,682 – 2021 ICAC Grant (Internet Crimes Against Children): In June of 2021 Police Services
was awarded the ICAC grant, but the corresponding appropriation was inadvertently excluded
from last year’s Annual Adjustment Ordinance.
i. $300,000 - Northern Colorado Regional Communication Network (NCRCN) Police Radios
Upgrades and Repairs: Police Radios have been failing on an increasing level due to aging
infrastructure for the Radio Towers in the surrounding area. Information Services is currently
working with Motorola and Bearcom to assess the current need, which is still in process. This
request is utilizing the dedicated reserves within the General Fund for NCRCN.
j. $208,465 - Police Reimbursable Overtime: Police Services help schedule security and traffic
control for large events. Since these events are staffed by officers outside of their normal duties,
officers are paid overtime. The organization who requested officer presence is then billed for the
costs of the officers' overtime. Fort Collins Police Services (FCPS) partners with Larimer County
to staff events at The Ranch. Police receives reimbursement from Larimer County for officers’
hours worked at Ranch events.
k. $42,022 - School Resource Officers: Police Services have a contract with Poudre School District
to provide officers on location at a majority of the schools for safety and support. The school
district pays Police Services based on a predetermined contract amount and also partially
reimbursing for overtime incurred. This request if for the previously billed overtime and anticipated
overtime for the remaining year.
l. $8,962 - DUI Enforcement: Proceeds that have been received for DUI enforcement from Larimer
County.
m. $96,243 - Police Miscellaneous Revenue: Police Services receives revenue from the sale of
Police reports along with other miscellaneous revenue, like restitution payments, evidence
revenue and SWAT training.
TOTAL APPROPRIATION
FROM: Unanticipated Revenue (2022/2023 BATTLE Grant) $36,516
FROM: Unanticipated Revenue (2022/2023 Black Market Marijuana Grant) $44,805
FROM: Unanticipated Revenue (2022 Body Worn Camera Grant) $75,152
FROM: Unanticipated Revenue (2022 Click it or Ticket Grant) $11,400
FROM: Unanticipated Revenue (Northern Colorado Drug Taskforce) $7,868
FROM: Unanticipated Revenue (2021/2022 HVE Grant) $11,400
FROM: Unanticipated Revenue (2022/2023 HVE Grant) $15,000
FROM: Unanticipated Revenue (2021 ICAC Grant) $7,682
FROM: Prior Year Reserves (NCRCN Police Radios Upgrades & Repairs) $300,000
FROM: Unanticipated Revenue (Police Reimbursable Overtime) $208,465
FROM: Unanticipated Revenue (School Resource Officers) $42,022
FROM: Unanticipated Revenue (DUI Enforcement) $8,962
FROM: Unanticipated Revenue (Police Miscellaneous Revenue) $96,243
$865,515
Page 55 of 107
Page 4
FOR: Help prevent auto theft $36,516
FOR: Support the investigation of illegal marijuana cultivation $44,805
FOR: Upgrade body worn cameras $75,152
FOR: Overtime for Seat Belt enforcement $11,400
FOR: Contribution to Northern Colorado Drug Task Force $7,868
FOR: Overtime for DUI enforcement $26,400
FOR: Help prevent Internet Crimes Against Children $7,682
FOR: Police Radios Upgrades & Repairs $300,000
FOR: Police Reimbursable Overtime for events $208,465
FOR: Overtime for School Resource Officers $42,022
FOR: DUI enforcement $8,962
FOR: Police Miscellaneous Revenue $96,243
$865,515
4. Radon Kits
Environmental Services sells radon test kits at cost as part of its program to reduce lung-cancer risk from
in-home radon exposure. This appropriation would recover kit sales for the purpose of restocking radon
test kits.
FROM: Unanticipated Revenue (radon kit sales) $1,471
FOR: Radon test kit purchase $1,471
5. Manufacturing Equipment Use Tax Rebate
Finance requests the appropriation of $109,010 to cover the amount due for the 2020 Manufacturing
Equipment Use Tax Rebate program as established in Chapter 25, Article II, Division 5, of the Municipal
Code. The rebate program was established to encourage investment in new manufacturing equipment by
local firms. Vendors have until December 31st of the following year to file for the rebate. This item
appropriates the use tax funds to cover the payment of the rebates.
FROM: Prior Year Reserves (Manufacturing Use Tax Rebate Assignment) $109,010
FOR: Manufacturing Use Tax Rebates $109,010
6. Restorative Justice Grant
A grant in the amount of $67,612 has been awarded and received from the Colorado Division of Criminal
Justice (DCJ) Juvenile Diversion fund for the continued operation of Restorative Justice Services, which
includes the RESTORE program for shoplifting offenses, the Restorative Justice Conferencing Program
(RJCP) and Reflect Program for all other offenses. No match is required for this grant. The grant period
is July 1, 2022 to June 30, 2023. Restorative Justice Services and its three programs has been partially
grant-funded since its inception in 2000. The Council yearly accepts grant funds from Colorado Division of
Criminal Justice to support Restorative Justice Services. This grant helps fund youth referred to the
program from the 8th Judicial District Attorney’s Office or in lieu of a summons. Since it began,
Restorative Justice Services has provided a restorative justice alternative to more than 3,300 young
people who committed chargeable offenses in our community.
FROM: Unanticipated Revenue (Restorative Justice Grant) $67,612
FOR: Restorative Justice Services $67,612
7. Administrative transfer of IRS alternative fuel vehicles refund from General Fund to Equipment
Fund (refer to item C4)
Operation Services applied for, and received, a refund from the IRS for alternative fuel vehicles. These
funds were not identified correctly when received in 2021 and were deposited in the General Fund. This
will move the money from the General Fund to the Operation Services Fund.
FROM: Transfer from Prior Year General Fund reserves (IRS refund) $266,783
FOR: Equipment Fund - Alternative fuel vehicles $266,783
Page 56 of 107
Page 5
B. DATA & COMMUNICATIONS FUND
1. Accela Permitting System Upgrade
The Information Technology (IT) Department is requesting funds from the Development Tracking Systems
(DTS) restricted reserves to fund this unanticipated expense request to upgrade the City's permitting
platform system. The City's IT department recently received notice that the Accela permitting platform will
no longer be supported based on the current version the City is utilizing. This is requiring the City to
upgrade to the latest version to avoid losing software support and any potential security risks associated
with being out-of-date. Upon initiating the upgrade process, staff identified the need for consultant
support to assist the City in upgrading its Development, Test, and Production Accela Civic Platform
environments. The City intends to contract with TruePoint Solutions, a vendor that has provided Accela
support in the past, to provide services as needed, including software installation, pre-installation/upgrade
preparation assistance and post-upgrade support. Once completed, the City's permitting platform will be
up to date. It will include a new user interface that offers additional features and functionality not currently
available, as well as improve the overall performance of the platform.
FROM: Prior Year Reserves (DTS assignment) $12,500
FOR: Accela Permitting System Upgrade $12,500
C. EQUIPMENT FUND
1. Unanticipated Fuel Revenue from Price increase
The price of wholesale fuel has been higher than budgeted. This has in turn also increase the price at
which the various city departments have Operation Services for the fuel. With the anticipated elevated
fuel prices for the remainder of the year.
FROM: Unanticipated Revenue $50,000
FOR: Fuel price increase $50,000
2. Charge Ahead Grant 2022
This is a State of Colorado Charge Ahead grant to install multiple electric vehicle chargers at multiple
locations. This grant requires a 20% local match which will come from the Operations Services 2022
operating budget.
FROM: Unanticipated Revenue (Charge Ahead Grant) $54,000
FOR: Electric vehicle chargers $54,000
3. Unanticipated Revenue and Expense associated with Purchase of Civic Center Condos
In January of 2022 the City of Fort Collins purchased the Civic Center Condos on Mason Street. These
condos are leased out with rental payments coming into the City. The management of the condos have
come with costs for operations and maintenance (O&M), and additional appropriation is being requested
to cover the O&M costs.
FROM: Unanticipated Revenue $255,010
FOR: Operations and Maintenance costs $255,010
4. Administrative transfer IRS alternative fuel vehicles refund from General Fund to Equipment
Fund (refer to item A7)
Operation Services applied for, and received, a refund from the IRS for alternative fuel vehicles. These
funds were not identified correctly when received in 2021 and were deposited in the General Fund. This
will move the money from the General Fund to the Operation Services Fund.
FROM: Unanticipated Revenue (IRS refund) $266,783
FOR: Alternative fuel vehicles $266,783
Page 57 of 107
Page 6
5. Equipment Fund Debt Service Payment
The original appropriation of this Certificate of Participants was done through Ordinance No. 73, 2022.
This request is for the first interest payment on the loan, which is due in December 2022. This amount is
a one-time payment and will come out of Equipment Fund reserves. This amount was not included in the
original Ordinance because it was not anticipated that the first interest payment would be due in 2022.
FROM: Prior Year Reserves $48,064
FOR: 2022 interest payment on loan $48,064
D. SALES & USE TAX FUND
1. Sales Tax transfer to Natural Areas (refer to item E1)
Sales tax collections were higher than expected in 2021, this is to transfer remaining amount due to
Natural Areas Fund.
FROM: Unanticipated Revenue (Sales tax collections) $48,076
FOR: Transfer to the Natural Areas Fund $48,076
E. NATURAL AREAS FUND
1. Sales Tax transfer to Natural Areas (refer to item D1)
Sales tax collections were higher than expected in 2021, this is to transfer remaining amount due to
Natural Areas Fund.
FROM: Unanticipated Revenue via transfer $48,076
FOR: Natural Areas land purchase and operations $48,076
F. GOLF FUND
1. Golf Fund Debt Service Payment
The original appropriation of this Certificate of Participations was done through Ordinance No. 72, 2022.
This request is for the first interest payment on the loan, which is due in December 2022. This amount is
a one-time payment and will come out of Golf Fund reserves. This amount was not included in the original
Ordinance because it was not anticipated that the first interest payment would be due in 2022.
FROM: Prior Year Reserves $80,022
FOR: 2022 interest payment on loan $80,022
2. Golf Player Assistant Pay
This is the cost associated with contractual labor payment increases to Golf Professionals for fees
associated with the required payment of Player Assistants. The Golf Fund is an enterprise fund and
receives no tax dollar support. In 2022, the Golf Division required the contracted golf professionals at all
three of the City’s golf courses to pay for Player Assistants on the golf course. In the past these positions
were filled by volunteers that were reimbursed only with playing privileges. Recent changes in labor laws
have required these individuals be paid for the work.
FROM: Prior Year Reserves $288,326
FOR: Contractual Labor payment increases $288,326
G. COMMUNITY CAPITAL IMPROVEMENT PROGRAM (CCIP) FUND
1. Carnegie Library renovation operations & maintenance support (refer to item H1)
This is the 2022 amount for the operations and maintenance support for the Carnegie Library renovation
Page 58 of 107
Page 7
as part of the Community Capital Improvements Program.
FROM: Unanticipated Revenue $25,000
FOR Transfer to Cultural Services (Carnegie Library) $25,000
H. CULTURAL SERVICES FUND
1. Carnegie Library renovation operations & maintenance support (refer to item G1)
This is the 2022 amount for the operations and maintenance support for the Carnegie Library renovation
as part of the Community Capital Improvements Program.
FROM: Unanticipated Revenue via transfer $25,000
FOR Carnegie Library Operations & Maintenance $25,000
I. WATER FUND
1. Bureau of Reclamation 2019 additional amount - Grant Xeriscape Incentive Program
This is a Bureau of Reclamation grant R19A00169 was awarded to Water Conservation for the Xeriscape
Incentive Program. Reclamation has increased that award by $5,000. The Bureau of Reclamation
released the additional funds after having retained the amount for administrative costs. This money goes
toward Xeriscape Incentive Program reimbursements for customers.
FROM: Unanticipated Revenue (Bureau of Reclamation grant) $5,000
FOR Xeriscape Incentive Program $5,000
2. Bureau of Reclamation 2022 - Grant Xeriscape Incentive Program
A Bureau of Reclamation grant was awarded to Water Conservation for the Xeriscape Incentive Program.
The full grant award of $75,000 will be used as customer reimbursements for the program. The match
funding requirement will be met by the program participants' required match.
FROM: Unanticipated Revenue (Bureau of Reclamation grant) $75,000
FOR Xeriscape Incentive Program $75,000
J. LIGHT & POWER FUND
1. Wholesale Purchased Power
Through July 2022 the amount of wholesale purchased power needed for Residential, Commercial &
Industrial sales has exceeded the budgeted amount of $1,833,680. One of the factors for this increase in
cost, besides increased demand, is the amount of intermittent energy sold to Fort Collins Utilities as
opposed to dispatchable energy. Intermittent energy costs just over twice the amount of dispatchable
energy costs. While our costs for wholesale purchased power have exceeded budget, so has our
revenue generated by sales of that energy to the rate payers. Through July 2022 revenues are in excess
of budget by $4,469,729.
FROM: Unanticipated Revenue (sales of purchased power) $2,000,000
FOR Wholesale purchased power $2,000,000
2. Systems Additions & Replacement
Through July 2022 the system additions & replacement budget, which is comprised of several business
units, is over budget by $1,297,000. The related revenues generated from development and upgrades to
the electric system are over budget by $3,894,735 through July 2022.
FROM: Unanticipated Revenue (electric capacity charge) $2,500,000
FOR Electric systems additions & replacements $2,500,000
Page 59 of 107
Page 8
K. TRANSPORTATION SERVICES FUND
1. South Timberline Corridor - Fort Collins-Loveland Water District - Reimbursement for Water
Line Improvements
Fort Collins-Loveland Water District (FCLWD) agreed to reimburse the City for water line improvements
within the footprint of the City's South Timberline Corridor project. FCLWD asked that the City perform
the water line improvements as part of the transportation capital improvement project to minimize traffic
disruptions. The water line improvements were not required as part of the City's transportation project.
The total amount of the reimbursement is $132,094 and will be credited to the South Timberline Corridor
project.
FROM: Unanticipated Revenue (reimbursement) $132,094
FOR South Timberline Corridor project $132,094
2. Shift Your Ride Transportation Demand Management (TDM) Program: Electric Micromobility
Pass and Education Series Pilot
The contract with SPIN requires them to pay $10,000 to the City annually for transportation programs
deemed appropriate by City staff. These funds will be used to cover printing costs, payroll taxes on the
employee SPIN passes, and other expenses associated with the program.
FROM: Unanticipated Revenue (Vendor payment (SPIN)) $10,000
FOR Shift Your Ride TDM Program $10,000
3. Streets: Work for Others
The Planning, Development and Transportation Work for Others program is a self-supported program for
all “Work for Others” activities within Streets. Expenses are tracked and billed out to other city
departments, Poudre School District, CSU, CDOT, Larimer County, developers and other public
agencies. The original budget of $3.0M was an estimate based on scheduled projects and anticipated
rates. Due to increased cost of asphalt, fuel, parts, and other materials, an additional $300,000 is
requested to cover costs through the end of 2022. Revenue for performing the work will offset the
expense (note: expense will not be incurred without offsetting revenue).
FROM: Unanticipated Revenue (reimbursement for work done) $300,000
FOR Work for Others program $300,000
FINANCIAL / ECONOMIC IMPACTS
This Ordinance increases total City 2022 appropriations by $7,564,003. Of that amount, this Ordinance
increases General Fund 2022 appropriations by $1,341,052, including use of $692,164 in prior year
reserves. Funding for the total increase to City appropriations is $6,369,851 from unanticipated revenue,
$1,121,076 from prior year reserves, and $73,076 from transfers between Funds.
The following is a summary of the items requesting prior year reserves:
Item #Fund Use Amount
A1 General Fund Emergency Preparedness and Security (EPS) Security Classes $13,621
A2 General Fund Land Bank Operational Expenses 2,750
A3i General Fund NCRCN Police Radios Upgrades and Repairs 300,000
A5 General Fund Manufacturing Equipment Use Tax Rebate 109,010
A7 General Fund
Administrative transfer IRS alternative fuel vehicles refund from
General Fund to Equipment Fund 266,783
B1 Data & Comm. Fund Accela Permitting System Upgrade 12,500
C5 Equipment Fund Equipment Fund Debt Service Payment 48,064
F1 Golf Fund Golf Fund Debt Service Payment 80,022
F2 Golf Fund Golf Player Assistant Pay 288,326
Total Use of Prior Year Reserves:$1,121,076
Page 60 of 107
Page 9
ATTACHMENTS
Attachment #1 – Presentation to City Council Finance Committee
Page 61 of 107
2022 Annual Adjustment Ordinance
Council Finance Committee –September 1, 2022
Attachment #1
Page 62 of 107
22022 Annual Adjustment Ordinance
The recommended 2022 Annual Adjustment Ordinance is
intended to address:
•2022 unanticipated revenues (e.g., grants & reimbursements)
•Appropriation of unassigned reserves to fund unanticipated expenditures
associated with approved 2022 appropriations
•Should be routine and non-controversial
•Items approved by the ordinance need to be spent within fiscal / calendar
year 2022, unless non-lapsing in nature
Page 63 of 107
32022 Annual Adjustment Ordinance
City-wide Ordinance No. , 2022 increases total City 2022
appropriations by $7,564k
•This Ordinance increases General Fund 2022 appropriations by $1,341k,
including the use of $692k in prior year reserves. Those reserves are primarily
for:
o $300k for NCRCN Police Radios Upgrades and Repairs
o $109k for Manufacturing Equipment Use Tax Rebate
•Funding for the total City appropriation of $7,564k is:
o $6,369k from Unanticipated Revenue
o $1,121k from Prior Year Reserves
o $73k from Transfers Between Funds
Page 64 of 107
4Summary of 2022 Adjustments by Fund
Funding (all values in $k)Additional
Revenue
Prior Year
Reserves Transfers TOTAL
General Fund $649 $692 $0 $1,341
Data & Communications Fund $0 13 $0 13
Equipment Fund 626 48 0 674
Sales & Use Tax Fund 0 0 48 48
Natural Areas Fund 48 0 0 48
Golf Fund 0 368 0 368
CCIP Fund 0 0 25 25
Cultural Services Fund 25 0 0 25
Water Fund 80 0 0 80
Light & Power Fund 4,500 0 0 4,500
Transportation Services Fund 442 0 0 442
GRAND TOTAL $6,370 $1,121 $73 $7,564
Page 65 of 107
5Larger Adjustments
Item (in $k)General
Fund
Equipment
Fund
Light &
Power
Fund
Other TOTAL
NCRCN Police Radios Upgrades and Repairs $300.0 $300.0
Police Reimbursable Overtime $208.5 $208.5
Manufacturing Equipment Use Tax Rebate $109.0 $109.0
Unanticipated Revenue and Expense associated with
Purchase of Civic Center Condos $255.0 $255.0
Administrative transfer IRS alternative fuel vehicles refund
from General Fund to Equipment Fund (refer to item A7)$266.8 $266.8
Wholesale Purchased Power $2,000.0 $2,000.0
Systems Additions & Replacement $2,500.0 $2,500.0
Golf Player Assistant & Streets Work for Others $588.3 $588.3
Sub-Total $617.5 $521.8 $4,500.0 $588.3 $6,227.6
All Other Recommended Items 723.6 152.1 - 460.8 1,336.4
TOTAL $1,341.1 $673.9 $4,500.0 $1,049.1 $7,564.0
Page 66 of 107
62022 Annual Adjustment Ordinance
Guidance Requested:
•What questions or feedback does the Council Finance Committee have
on the 2022 Annual Adjustment Ordinance?
•Does the Council Finance Committee support moving forward with
bringing the 2022 Annual Adjustment Ordinance to the full City Council?
Page 67 of 107
Page 68 of 107
COUNCIL FINANCE COMMITTEE
AGENDA ITEM SUMMARY
Staff: Blaine Dunn, Accounting Director
Date: September 1, 2022
SUBJECT FOR DISCUSSION: Status of Fund Balances and Working Capital
EXECUTIVE SUMMARY:
The attached presentation gives a status of fund balances and working capital. Fund balances are
primarily considered for funding one-time offers during the Budgeting for Outcomes process.
To a lesser extent, available monies are also used to fund supplemental appropriations between
BFO cycles.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
General update to Council Finance Committee
BACKGROUND/DISCUSSION
To aid in answering the question of what funding is available to support emerging issues and
initiatives in the next budget cycle. In each fund the balances are shown vertically by the
accounting classifications. The amounts are then additionally categorized into Appropriated,
Available with Constraints, and Available for Nearly Any Purpose.
Appropriated, Minimum Policy or Scheduled is comprised of minimum fund balances
established by policy, funds from the 2021 balance that have been appropriated in 2022, and
amounts for projects specifically identified by voters. An example of the latter is Community
Capital Improvements Plan.
Available with Constraints are those balances available for appropriation but within defined
constraints. An example are donations received through City Give. They are restricted for the
purpose of the donation, but still available for appropriation.
Available for Nearly Any Purpose are balances that are available for appropriation at the
discretion of the City Council.
ATTACHMENTS
A. PowerPoint presentation
Page 69 of 107
Status of Fund Balances
September 1, 2022Blaine Dunn, Accounting DirectorPage 70 of 107
Objectives
•Inform Committee on Types of constraints
•Review fund balances as of 12/31/2021
•How Fund Balances are used in the budget process
Page 71 of 107
Fund Balance Definitions
Non-spendable
•Non-liquid in form (e.g. inventory, long-term receivables, land)
•Legally or contractually required to be maintained intact (e.g. permanent endowments)
Restricted
•Externally / 3rd Party enforceable legal restrictions (e.g. TABOR emergency reserve, debt covenants, re-development agreements, IGA’s)
Committed
•Constraint formally imposed at the Council or Board Level through Ordinance (e.g. Capital Expansion fees, Neighborhood Parkland fees)
Assigned
•Intended to be used for specific purposes (e.g. Affordable Housing, Camera Radar, Encumbrances), not authoritative
Unassigned
•Available for any City purpose
Most
Constrained
Least
Constrained
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Use of Restricted Balances
Available but with some constraints
•Street Maintenance Program within Transportation fund are restricted but
available as defined in the ballot language
•Donations made within a fund are available, but for the donations purpose
Available for nearly any purpose
•Funds available at the discretion of the City Council for any municipal purpose
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General Fund Balances
•$2.5M Land-bank program inventory, held at lower of cost or market
•$7.7M is an emergency reserve required by TABOR, equal to 3% of qualified governmental
revenue; City also has policy setting an additional $34.2M aside
•Traditionally fund balances are assigned for camera radar and photo red-light, public safety
dispatch system, affordable housing and waste innovation
•$13.2M is set aside for prior year purchase orders, reappropriation, and budgeted use of
reserves
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Additional Funds
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Planned use of $9.2M in reserves for SE Community Center in 2023
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