HomeMy WebLinkAbout034 - 04/05/2022 - APPROPRIATING PRIOR YEAR RESERVES FROM THE LIGHT AND POWER FUND FOR USE IN THE CONNEXION ACCOUNT TOORDINANCE NO. 034, 2022
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING PRIOR YEAR RESERVES FROM
THE LIGHT AND POWER FUND FOR USE IN THE
CONNEXION ACCOUNT TO COMPLETE THE CONNEXION
SYSTEM CONSTRUCTION AND CUSTOMER RAMP UP AND
PROVIDING FOR FUTURE COST RECOVERY
WHEREAS, the City is currently in the fourth year of building and installing fiber-optic
based telecommunication facilities throughout Fort Collins (the "Project") to be operated by
Connexion, the City's telecommunication services division within the City's Electric Utility as
established in Article VIH in Chapter 26 of the City Code ("Connexion"); and
WHEREAS, Connexion has already begun to provide and will continue to provide
telecommunication services to the City's residents who subscribe to such services, which services
include broadband Internet, telephone and cable television services; and
WHEREAS, the City Council has previously appropriated almost $123 million to fund the
construction of the Project; and
WHEREAS, the current estimate of the total cost to complete the Project is approximately
$143 million, and based on this an additional $20 million is needed to complete the Project; and
WHEREAS, this Ordinance appropriates this additional $20 million from the prior year
reserves available in the Light and Power Fund for use in the Connexion Account, a subdivision
of the Light and Power Fund, to be expended from the Connexion Account to complete the Project
; and
WHEREAS, this appropriation benefits the public health, safety and welfare of the
residents of Fort Collins and serves the utility purpose of completing the Project to provide
telecommunication services throughout Fort Collins; and
WHEREAS, Article V, Section 4 of the City Charter permits the City Council, upon the
recommendation of the City Manager, to make supplemental appropriations by ordinance at any
time during the fiscal year such funds for expenditure as may be available from reserves
accumulated in prior years, notwithstanding that such reserves were not previously appropriated;
and
WHEREAS, the Interim City Manager has recommended the appropriation described
herein and determined that this appropriation is available and previously unappropriated from the
prior year reserves in the Light and Power Fund and will not cause the total amount appropriated
in the Light and Power Fund to exceed the current estimate of actual and anticipated revenues and
all other funds to be received in the Fund during this fiscal year.; and
WHEREAS, Article V, Section I 1 of the City Charter authorizes the City Council to
designate in the ordinance when appropriating funds for a capital project, that such appropriation
shall not lapse at the end of the fiscal year in which the appropriation is made, but continue until
the completion of the capital project; and
WHEREAS, the City Council wishes to designate the appropriation herein for the Project
as an appropriation that shall not lapse until the completion of the Project.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1. That the City Council hereby makes and adopts the determinations and
findings contained in the recitals set forth above.
Section 2. That there is hereby appropriated from prior year reserves in the Light and
Power Fund the sum of TWENTY MILLION DOLLARS ($20,000,000.00) for use in the
Connexion Account, a subdivision of the Light and Power Fund, to be expended from the Account
for the completion of the Project.
Section 3. That it is City Council's intent, and direction to the City Manager and the
City's Financial Officer, that this amount appropriated be reimbursed annually to the Light and
Power Fund in the amount the Connexion revenues collected exceed Connexion's expenses and
debt obligations for that fiscal year, together with an interest factor which is the greater of the Light
and Power Fund's average investment earnings for its reserve balance for that year or the average
ten-year AA bond rate for that year, until this appropriated amount with such interest has been paid
in full, which payment in full is to be completed on or before January 1, 2029. In addition, when
the City Manager is setting under City Code Section 26-573 Connexion's rates, fees and charges
for furnishing telecommunication facilities and services to its subscribers, the City Manager shall
do so taking into consideration this reimbursement of the Light and Power Fund as provided in
this Section 3.
Section 4. That the appropriation herein for the Project is hereby designated, as
authorized in Article V, Section 11 of the City Charter, as an appropriation that shall not lapse at
the end of this fiscal year but continue until the completion of the Project.
Section 5. That it is also the City Council's intent that, in the event the City or the
Electric Utility Enterprise hereafter issues any bonds or incurs any other financial obligation to be
used to reimburse the Light and Power Fund for the Connexion's expenditure of this appropriation
for the Project, this Ordinance is intended to be a declaration of "official intent" to reimburse these
expenditures within the meaning of Treasury Regulation § 1.150-2.
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Introduced, considered favorably on first reading, and ordered published this 1 st day of
March, A.D. 2022, and to be presented for final passage on the 5th day of April, A.D. 2022.
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SEAL
ATTEST:
City Clerk
Passed and adopted on anal reading on the 5th
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City Clerk
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