Loading...
HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 3/20/2018 City of Glendale 5850 West Glendale Avenue Glendale, AZ 85301 rgri iE Meeting Minutes Tuesday, March 20, 2018 9:00 A.M. Budget Workshop Meeting Council Chambers City Council Mayor Jerry Weiers Vice Mayor Lauren Tolmachoff Councilmember Jamie Aldama Councilmember Joyce Clark Councilmember Ian Hugh Councilmember Ray Malnar Councilmember Bart Turner CALL TO ORDER Mayor Weiers called the meeting to order at 9:01 a.m. ROLL CALL Present: Mayor Jerry Weiers Vice Mayor Lauren Tolmachoff Councilmember Jamie Aldama Councilmember Joyce Clark Councilmember Ian Hugh Councilmember Ray Malnar Councilmember Bart Turner Also Present: Kevin Phelps, City Manager Tom Duensing, Assistant City Manager Jack Friedline, Assistant City Manager Michael Bailey, City Attorney Julie K. Bower, City Clerk WORKSHOP SESSION 1. FY18-19 BUDGET WORKSHOP Presented by: Tom Duensing, Assistant City Manager Presented by:Vicki Rios, Director, Budget and Finance Ms. Rios said a capital improvement plan (CIP)applied to assets valued at over$50,000 with a useful life of five years or more and included land, buildings, streets and improvements, plants and large equipment. The Council adopted a ten-year plan but only the first year was budgeted and appropriated. The financial policy was to improve and replace existing assets as needed and construct new assets. Projects in years one through five had identified funding sources. Ms. Rios said that staff was asking Council for feedback on projects being reduced, eliminated, increased or added and whether timing for projects should be moved up or deferred. Funding sources included: •Pay-As-You-Go ,•Bonds - General Obligation (G.O.), Municipal Property Corporation and Excise Tax and Revenue Bonds •Development Impact Fees (DIF) •Transportation Sales Tax •Enterprise User Fees •Grants Mr. Duensing said there would not be an increase in G.O. bond capacity until the year 2023. Debt service payment of the Municipal Property Corporation and Excise Tax bonds was paid by the General Fund and payments would level out to$36 million per year in 2021. Ms. Rios said Council approved the CIP prioritization criteria for G.O. bond-funded requests in November 2017. CIP requests were due December 2017 and projects were ranked in January 2018. Carryforward appropriations would be added to the FY18-19 budget in April and would be part of the tentative and final budget requests. Vice Mayor Tolmachoff asked if it would include projects that had not been started and would the City Council Meeting Minutes-March 20,2018 Page 2 of 10 project costs be included in the carryforward. Ms. Rios said that was correct if the projects were adopted in the CIP and had been planned. Vice Mayor Tolmachoff asked if the projects would be identified in the carryforward as not completed and/or started or be combined with the carryforward. Ms. Rios said that none of the projects, whether started or not, would be distinguishable in the carryforward. If Council wanted that information, staff could provide it. Vice Mayor Tolmachoff would like a carryforward list of projects that had not been started. Ms. Rios said the total funding for the ten-year CIP was $1.2 billion and was made up mostly of bonds and enterprise funds. Councilmember Clark asked if the bonds/construction funds were G.O. funds. Mr. Duensing said the bond/construction funds were G.O. bond-funded projects only. Within the $521 million, projects were included that did not make the priority list, such as the library renovation. The renovation was included in the previous year's CIP, approximately$15 to$16 million, but did not make the current prioritization list. Staff was asking Council to determine if a project should remain in the CIP without an identified funding source or should be removed from the priority list. Councilmember Clark asked if it was proper to discuss a project that was ten years out. Mr. Duensing said that if Council was comfortable with leaving the projects in the CIP, the discussion could be postponed. It would not affect years one through five but years six through ten had projects with no identified funding source. Councilmember Clark was concerned that FY2024 was so far out. It was hard to anticipate revenues or liabilities. A bond election would be required to fund areas where there were deficiencies. Project priorities should be discussed later. Mayor Weiers confirmed that Council would be fine with postponing the discussion. Mr. Duensing said over the next ten years, the DIF Fund would provide about$3 to$4 million. The fees could increase due to economic development projects but a substantial increase was not expected. Councilmember Clark asked about the status of a review of the DIF fee schedule. Mr. Duensing said there would be a review of the DIF fee schedule. Mr. Duensing said the Enterprise/Other Funds was really a"catch-all"for non G.O. and DIF and included Water and Sewer. He said staff would be providing a draft of the Transportation Master Plan by the end of April. Councilmember Clark said, in comparing the FY 17-18 budget to the proposed FY 18-19 budget, Water and Sewer showed an increased allocation of$300,000. Water had an increase of$8 million. Sewer had an increase of$1.4 million. Sanitation had increased by$1.3 million and Landfill by$4 million. She asked if the increases were attributable to the rate increases that were implemented earlier in the year. Ms. Rios said no projects were included in the CIP that could not be funded with rates. The City Council Meeting Minutes-March 20,2018 Page 3 of 10 projects were identified in the rate models. Certain projects were needed in order to increase the rates. The projects were not assumed in last year's CIP because there was no funding. Councilmember Clark asked if the projects were now able to be funded. Ms. Rios said the projects were already identified in the CIP but were removed because of the lack of funding. When the rate increases were approved, the projects were returned to the CIP. Councilmember Clark asked Ms. Rios to explain the General Fund Capital Reserves. She asked if the fund was the unappropriated monies remaining at the end of the fiscal year. Ms. Rios said that Building Maintenance Reserves or General Fund Capital Reserves, was an amount funded by the General Fund for general government types of Capital Projects. Councilmember Clark asked if the projects were Pay-As-You-Go. Ms. Rios said that was correct. Councilmember Clark asked if it was excess general capacity that had been allocated to the Building Maintenance Reserve, fire tender trucks and Fire Department air-pack replacements. Mr. Duensing said the items were capital items that were financed from the General Fund. The allocation made sure everything was maintained each year. Mr. Phelps explained that staff had identified needs for immediate capital improvements and based on an assessment that allowed the City to keep things going. It was not an excess reserve as much as it was an anticipated need that had been identified. Councilmember Clark stated that the word "reserve" meant excess money tucked away. She asked how much reserve was available to allocate for necessary projects and was it only the amount shown or was there more tucked away. Mr. Duensing said that the total General Fund, Pay-As-You-Go projects, in the new CIP were $3.24 million. Councilmember Clark said the money was part of the overall budget. She asked if staff would determine where it was spent or would it be presented to Council for guidance on how it was to be expended. Mr. Duensing stated that it was Council determination based on staff recommendation. The facilities needed to be maintained and fire equipment had to be replaced. Council had the final say and staff could provide further details on the need. Councilmember Clark said it would be good if staff brought the full amount available along with the recommendations for Council to decide the amount of funding. Ms. Rios continued her review of notable projects including water/sewer and streets/transportation projects. Councilmember Malnar had requested a significant increase to the street crews for the street projects. He asked if the funding reflected the increase for additional crews. Council would like to see street maintenance expedited so did the funding reflect that as well. Mr. Friedline said the allocations had not changed. Staff would be setting up a meeting to discuss additional crews. As for the resurfacing projects, the team would do crack fill and seal and then an City Council Meeting Minutes-March 20,2018 Page 4 of 10 overlay. A second crew would be used to perform the mill and overlay so both north and south were completed at the same time. Councilmember Turner said it would be good to have both north and south completed at the same time. It appeared streets were at the top of the priority list and it was important to show residents that Council was listening to their concerns. Vice Mayor Tolmachoff referred to page 3 of the CIP Summary, Open Space/Trails Construction for Thunderbird Paseo Linear Park Master Plan. She asked if there was an assessment of the trails to determine the erosion and condition of the trails. Ms. Rios said that was correct. Councilmember Turner said according to the intergovernmental agreement(IGA)with the City of Phoenix, no payment would be made to Camelback Ranch (CBR) in FY 2020. He preferred moving the$1,086,822 allocation from the CBR Land IGA to the Camelback Ranch Maintenance Fund for FY 2020 and using $500,000 from the FY 19-20 Maintenance Fund as a reserve for capital improvements to Glen Lakes Golf Course. The lack of capital improvements had been a detriment to the golf course. The reallocation would be harmless to the Camelback Ranch Fund. Mr. Duensing said when the final CIP was presented, the CBR Land IGA would not be included because payment had been completed. The$1,086,822 would be removed from the budget in FY 2020. Vice Mayor Tolmachoff agreed that the funding needed to be reallocated but not to Glen Lakes Golf Course. It would be more appropriate to move the funds into Capital Repair Arena because it aligned better with the original purpose of the funding and it was an aging asset that was heavily relied on for the sports and entertainment district. The arena would be needing more than $500,000 a year in maintenance. Councilmember Clark would like to see funding allocated to the Civic Center for maintenance. Councilmember Aldama asked if the Glen Lakes Golf Course was in the CIP and if there was a long-term plan for it. Ms. Rios was not aware of a specific project identified for the golf course. Mr. Duensing said there was no long-term plan for Glen Lakes. Staff would be bringing the Glen Lakes issue to Council for further discussion. Councilmember Malnar said discussion was needed about the future of Glen Lakes so that some of the funds could be allocated if it was deemed necessary. He wanted to see the process expedited so that the citizens knew that consideration was being given to Glen Lakes. Councilmember Aldama agreed with Councilmember Malnar. If the project was not in the current CIP, he was unsure how to allocate the funding. Citizens should be made aware of the plan. Councilmember Clark asked if the funding could be parked in a newly-created fund such as unappropriated contingency, until further discussion could take place. Mr. Duensing said the funding could be put into a fund. It was important to be clear that the current appropriation was for the,second year and would not be legally appropriated only adopted into the CIP. If Council wanted something to be done next year, staff could prepare information showing the investment and timing issues of CBR. If FY 2019 could be kept within the$1.1 million, it would not negatively impact the General Fund. City Council Meeting Minutes-March 20,2018 Page 5 of 10 Mr. Duensing said lowering the investment in CBR could potentially cost more next year. It was important for a discussion to take,place about CBR. Staff was working with CBR management to develop a CIP and the information would be brought to Council, once completed. Councilmember Clark said she and Mayor Weiers had expressed a desire to have Heroes Regional Park Lake shifted up on the priority list. The list indicated it was slated for FY 2022. She said perhaps some of the additional $1,086,822 could be utilized for the design portion of Heroes Regional Park Lake. Mr. Friedline said Vice Mayor Tolmachoff was correct in pointing out the arena and building maintenance reserves as placeholders. The building maintenance reserves were underfunded and staff was working with CBR and arena staff to develop a more detailed CIP. It was important that the City take care of the existing facilities. Mayor Weiers asked if a decrease was made to the arena budget five years ago due to a lack of funding. Mr. Duensing believed that was correct. It was simple affordability that determined the decrease. Councilmember Clark thought it was alternating years for arena maintenance, $1 million one year and $500,000 the next year. Mr. Friedline believed there was a trigger year(2019)when the funding jumped from $500,000 to $1 million but there was no detailed program information like the current CIP. Councilmember Aldama asked if there was a backlog of repairs for the facility that were in need of being completed. Mr. Duensing said there was a detailed CIP that was submitted annually by the arena staff. Typically, the arena was sustainable at$500,000 but as the arena aged, it would require more maintenance. Councilmember Turner said Council had made a special appropriation for Glen Lakes Golf Course to keep it operating and to allow staff, Council and the community to analyze the facility and to provide input on its future. He reiterated his desire to consider setting funds aside for capital improvements. Councilmember Turner was open to creating reserves for the arena as well. None of the City's facilities should be neglected as Glen Lakes had. He suggested that some of the profit-sharing funds from the arena be used for the arena reserves and/or be allocated to the capital repair fund. Vice Mayor Tolmachoff asked if further discussion would take place about Glen Lakes. She did not agree that Glen Lakes had been neglected and felt that appropriating additional monies would not be appropriate due to the uncertainty of Glen Lakes. Mr. Phelps said information could be brought back to Council for a broader discussion. Staff had recommended a specific vendor because the vendor was able to perform an assessment and stabilize the property while the City looked at options. The current vendor was not designed to be a permanent operator of the golf course. Vice Mayor Tolmachoff found it offensive that Barrel District constituents did not know that the City had allocated funding to Glen Lakes. The City had not neglected Glen Lakes. It had been mismanaged. City Council Meeting Minutes-March 20,2018 Page 6 of 10 Vice Mayor Tolmachoff referred to the replacement of existing assets for the fire, ladder and tender trucks and asked about the narrative in the Citygate Report regarding the Asset Management Program for Fire and Police. She asked if that was the program that would be funded. Fire Chief Terry Garrison said part of the recommendations from the Citygate Report was to develop an asset management plan. The plan was part of staying ahead of the requirements to keep the trucks and apparatus working efficiently. Vice Mayor Tolmachoff asked whether the items would fall under the Fire Department budget or be a separate item of the Asset Management Plan. Ms. Rios said that many City vehicles, such as Police and some Fire Department, Code Compliance vehicles, etc., were a part of the Fleet Management System. Money was transferred each year from the General Fund to general-funded vehicles as a part of a regular maintenance program for larger assets. Fire Department staff provided the replacement schedule of the ladder and tender trucks. Vice Mayor Tolmachoff said that it seemed out of place because it was not part of the Fire Department budget and no other City departments were showing under that area of the budget. Ms. Rios said airpacks and tender trucks qualified as capital assets and would not be part of the Fire Department budget but it was important to identify the expense. Mayor Weiers asked for a rough estimate that included preliminary costs and engineering for the Heroes Park Lake. Jim Burke, Director of Public Facilities, Recreation &Special Events, said that the estimate was $4.5 million for the lake but he did not have the complete breakdown of the costs. The$4.5 million would be just enough for the lake based on the master plan. It would not include amenities or the scale of the lake and he considered it a very general number. Mayor Weiers asked that some planning and engineering information be provided to Council so that if extra funding was found, Council could be a step ahead. Mr. Burke said the information would be refined and a better analysis provided to Council. Councilmember Clark requested a total percentage of what public safety consumed of the budget for the current budget year. Councilmember Clark said a new fund - Government Facilities Construction -was born because it was not in last year's budget book. She asked how a new category was born. Ms. Rios said that new funds were born in the Finance Department to help the department keep track of projects. The projects listed under Government Facilities Construction were funded with G.O. bonds using the bond authorization. Vice Mayor Tolmachoff asked for an explanation of the amount allocated and what was currently showing for the Field Operations Campus Renovation. She asked if the project had been scaled back. Michelle Woytenko, Field Operations Director, said the project had not been scaled back but had been allocated among different funds. Vice Mayor Tolmachoff asked why the project was not included in the water rates and had it been City Council Meeting Minutes-March 20,2018 Page 7 of 10 assumed it would come out of the General Fund. Ms. Rios said that the solid waste portion was anticipated but water and sewer was not. The next time a water rate study was performed, it would be decided if it could be funded. She felt the Water Services Department could absorb the cost and did not believe it would increase the rates above what was presented to Council last year. Vice Mayor Tolmachoff asked about the master plan for the project. Ms. Woytenko said that a master plan was being finalized and would be presented to Council once completed. Vice Mayor Tolmachoff asked what was planned for the City Court building. Mr. Duensing understood that$4 million would be used to remodel the court building. Ms. Rios said a discussion had taken place at a previous Council workshop regarding changing - the language in the current financial policy concerning property tax. The new language would indicate that Council would look at or evaluate the property tax each year. Councilmember Clark did not like the wording, "up to the maximum allowable amount" and preferred a period after the word "set." Mayor Weiers said "up to the maximum allowable amount"needed to be in the policy. Councilmember Malnar had no problems with the revision. Councilmember Turner said it went without saying that the City could not exceed the maximum allowable amount and felt taking the wording out of the policy would be fine. Mayor Weiers said the consensus was to put a period after"set". Ms. Rios continued with another policy revision regarding the General Fund balance. The existing language was confusing. The proposed wording was"The minimum fund balance in the General Fund, which is defined as the unassigned amount, shall total 25% of the total annual ongoing revenues." Councilmember Clark asked about the goal of$50 million. Ms. Rios explained that the actual policy was "25% of the total annual ongoing revenues". Councilmember Clark said if it was 25% of the annual ongoing revenues,the number would grow. Ms. Rios said that was correct. Coucilmember Clark asked how much reserve was required by the City. Mr. Duensing said that in the event of an emergency, the City was able to absorb the costs. Ms. Rios said it was defined as"ongoing revenues"which allowed for one-time items. Mr. Phelps said it was a best practice to use a percentage for a fund reserve. Most of the City's budget could not be stopped instantly, so having a percentage was really the best practice for the City's commitments to deliver service. Council could direct the fund balance through the budget City Council Meeting Minutes-March 20,2018 Page 8 of 10 process. Mayor Weiers asked if best practices were changed, did that change the City's bond rating. Mr. Duensing said bond raters were very aware of the policy of 25% of the total annual ongoing revenues. The City was provided upgrades because it delivered on what it said it would do. He recommended not touching the Fund for several years. Councilmember Turner was concerned about the rigidity. The language was pretty tight. It would be better to have a more flexible policy to meet the needs of the City. He asked if the proposed language was in compliance. Ms. Rios said a revision of the terminology that defined the calculation of the fund balance was what was being requested. The policy did allow the City to drop below the 25% and the City was currently below it. The policy stated that the City had five years to get back to the 25%. Mr. Phelps said that the proposed revision clarified the policy. Council consensus was to proceed with the change. MOTION AND CALL TO ENTER INTO EXECUTIVE SESSION A motion was made by Councilmember Ray Malnar, seconded by Councilmember Ian Hugh to hold an executive session. AYE: Mayor Jerry Weiers Vice Mayor Lauren Tolmachoff Councilmember Jamie Aldama Councilmember Joyce Clark Councilmember Ian Hugh Councilmember Ray Malnar Councilmember Bart Turner Passed EXECUTIVE SESSION Council entered into executive session at 10:38 a.m. for legal advice, discussion and consultation regarding the City's position in pending or contemplated litigation, including settlement discussions conducted in order to avoid or resolve litigation (A.R.S. § 38-431.03(A)(3)(4)); discussion and/or consultation with the City Attorney to receive an update, to consider its position, and to provide instruction/direction to the City Attorney regarding Glendale's position in connection with a contract relating to property in the area of 110th Avenue and Orangewood Avenue. (A.R.S. §§ 38-431.03 (A)(3)(4)(7)); and discussion and/or consultation with the City Attorney to receive an update, to consider its position, and to provide instruction/direction to the City Attorney regarding Glendale's position in connection with a contract relating to property in the area of 91st Avenue and Bethany Home Road. (A.R.S. §§38-431.03 (A)(3)(4)). A motion was made by Councilmember Jamie Aldama, seconded by Vice Mayor Lauren Tolmachoff to adjourn the executive session. AYE: Mayor Jerry Weiers Vice Mayor Lauren Tolmachoff Councilmember Jamie Aldama City Council Meeting Minutes-March 20,2018 Page 9 of 10 Councilmember Joyce Clark Councilmember Ian Hugh Councilmember Ray Malnar Councilmember Bart Turner Passed The executive session adjourned at 11:19 a.m. ADJOURNMENT A motion was made by Councilmember Ray Malnar, seconded by Councilmember Ian Hugh to adjourn the meeting. AYE: Mayor Jerry Weiers Vice Mayor Lauren Tolmachoff Councilmember Jamie Aldama Councilmember Joyce Clark Councilmember Ian Hugh Councilmember Ray Malnar Councilmember Bart Turner Passed Mayor Weiers adjourned the meeting at 11:19 a.m. I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the meeting of the Glendale City Council of Glendale, Arizona, held on the 20th day of March, 2018. I further certify that the meeting was duly called and held and that a quorum was present. Dated this 5th day of April, 2018. ark. Bower, MMC, City Clerk City Council Meeting Minutes-March 20,2018 Page 10 of 10