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January 13, 2009 Minutes CITY OF DENTON CITY COUNCIL MINUTES January 13, 2009 nd After determining that a quorum was present, the City Council convened in 2 Tuesday Session on Tuesday, January 13, 2009 at 4:00 p.m. in the City Council Work Session Room at City Hall. PRESENT: Mayor Burroughs; Mayor Pro Tem Kamp; Council Members Heggins, Moreno, Mulroy, and Thomson. ABSENT: None 1. The Council received a report, held a discussion and gave staff direction on the proposed RFSP #4237 Downtown Implementation Plan for professional services to include a Parking Plan, Architectural Design Guidelines, Open Space and Linkages, and Land Use Analysis for the Denton Downtown. Mark Cunningham, Director of Planning and Development, stated that the purpose of the Downtown Implementation Plan was to identify the actions necessary to achieve the identified goals of the adopted Downtown Master Plan. Downtown Master Plan Goals included (1) the Downtown should be a vital part of Denton’s economy; (2) should be a source of pride, (3) should be a place to live, work and play; (4) should contain compact and concentrated activities, (5) should contain a variety of things to do, (6) should be pedestrian friendly and an enjoyable place to walk, (7) should have linked parks and open space and (8) should be attractive and well designed. The implementation plan would also address downtown parking, architectural design, land use analysis and open space and linkages. Elements of the Parking Plan included (1) a block-by-block preparation that detailed the overall parking supply and demand for on-street and off-street parking; (2) identifying specific locations for additional parking, shared parking, and new public facilities with recommendations for funding mechanisms over a specified time period and (3) included recommendations for amendments to existing codes, planning policy decisions and regulations that might impede implementation of the parking plan. Mayor Burroughs suggested taking the pressure off people to park downtown by having policies/procedures to ride transit methods from the universities to the downtown area to avoid taking so many spaces. Council Member Watts stated that the economic feasibility study provided options for funding and included a TIF but felt that others such as bonds would be available. Architectural Design Guidelines of the Plan would include the development of architectural design standards for new construction, modifications, alterations, or façade changes to existing structures. Council Member Watts asked about a design committee that was mentioned and how members would be appointed to that committee. Cunningham stated that the members would be appointed by the Council but they would need to know from the architect what to take to the committee. City of Denton City Council Minutes January 13, 2009 Page 2 The Land Use Analysis portion of the plan would include a plan for the facilitation of zoning amendments to existing codes and land use regulations and/or the creation of new land use districts within the study area with recommended guidelines and standards. The current zoning would be reviewed with recommendations for appropriate land uses that supported downtown development/redevelopment and develop vertical and horizontal mixed used design standards. Mayor Burroughs asked if an arts/entertainment district development would be looked at in the RFP for the downtown area. Cunningham stated that the concept would be included. The Open Space and Greenway Linkages element included improving and increasing existing open space, parks and greenway linkages to support the planned downtown transit oriented development and increasing downtown residential development. The plan would also make recommendations for funding. Existing open spaces and opportunities for new spaces plus two and three-dimensional public art would be reviewed. Cunningham reviewed the implementation schedule. The RFP agreement was budgeted for FY 2008-2009 and would be presented to the Downtown Task Force on January 14, 2009. It would also address funding opportunities and ways of ensuring efficient process review and approval by the City. The recommendation was to direct staff to proceed with the RFSP. Council Member Watts asked how long it would take to complete the study once the award was made. Cunningham stated that he hoped it would not take longer than 6 months. Council Member Mulroy suggested a review of the density and get changes memorialized as necessary. The Parks Department might consider doing a companion study on open space/greenway linkages especially with Quakertown Park. He also suggested opening up the Selection Team for major downtown merchants and invite them to participate. Consensus of the Council was to proceed with the RFP process. 2. The Council received a report, held a discussion, and gave staff direction regarding the size and timing of future General Obligation Debt Service bond programs. Bryan Langley, Director of Finance, presented the overview and purpose of the presentation. It would incorporate a review of components of the tax rate, discuss general obligation debt service fund principal revenue sources, review general obligation debt service fund 5 year long term financial plan, discuss future bond program possibilities and discuss staff recommendations and next steps. Tax Rate Fundamentals The tax rate was comprised of two components - operations and maintenance which was deposited into the General Fund and general obligation debt service which was deposited into the general obligation debt service fund. City of Denton City Council Minutes January 13, 2009 Page 3 For FY 2008-09 the total tax rate was Operation & Maintenance, $0 .44765; debt, $0.21887 for a total rate of $0.66652. The GO/CO debt service requirements were paid from the GO debt service fund. The revenue bond debt service was paid from the respective utility funds. GO Debt Fund Key Revenue Sources Property tax was the principal revenue source for GO debt service fund. Transfers from other funds also represented significant revenue sources. Transfers were related to debt that had been issued for specific purposes in other funds such as solid waste, technology services or fleet services. Interest income and delinquent tax revenue also provided additional resources. Long Term Financial Plan Assumptions No tax rate increase for GO debt service fund with a potential tax increase for the General Fund in FY 2010-2011. Appraisal growth assumptions mirrored those in the General Fund. A 4% growth was projected in 2009-10 and 7% growth was projected in 2010-13. Interest income would be $350,000 per year Delinquent tax income from prior years would be at $137,000 per year. The financial plan attempted to maintain a constant tax rate despite fluctuations in the debt service requirement. The fund balance levels were managed to offset potential tax rate increases. Lower property tax growth assumptions had a significant impact on debt service capacity. Debt issuances in FY 2008-09 included the remaining $10.0 million general obligation debt to be issued from the 2005 program. An additional $15.4 million in COs would be issued for a variety of projects including the construction of a public safety training facility. In future years, $4.0 million in COs would be issued each year of the plan. $2.5 million would be used for vehicle replacement and $1.5 million for facility improvements. The adopted long term financial plan assumed a GO bond program of $5 million. An election would be held in November of 2009 with $5 million sold in 2010-2011, $10 million in 2011-2012, $15 million in 2012--2013, and $15 million in 2013-2014. Langley then reviewed the adopted 5 year financial forecast in terms of the GO debt service fund and also reviewed the appraised value growth from 2007-09 to 2012-13. Considerations for 2009-10 Forward FY 2010-11 was a critical year in the 5 year plan as the fund balance was projected to be less than $100,000. Appraised value growth estimates might be aggressive. FY 2009-10 preliminary appraised values would not be known until May 2009. If growth rates were lowered, the financial plan capacity was reduced substantially. The current bond market would likely mean higher interest rates than previously realized. A 1 cent tax increase would provide capacity for approximately $7.2 million increase in debt issuance. City of Denton City Council Minutes January 13, 2009 Page 4 Long Term Plan Options with Revised Growth Assumptions Option A included a planned $25.7 million bond sale in 2008-09 and a new $45 million GO program with a November 2009 election. The fund balance would go negative with this option. Option B included a planned $25.7 million sale in 2008-09 and new $45 million GO program with a November 2010 election. The fund balance would still go negative but not as much as Option A. Option C included a planned $25.7 million bond sale in FY 2008-09 but had no additional GO bond program. The fund balance would still be negative. Option D had a planned $14.6 million GO/CO sale in FY 2009-09, delayed the Public Safety Training Facility sale to FY 2009-10 and had no additional GO bond program. Again, the fund balance would be negative. Option E delayed the planned $25.7 million bond sale including the Public Safety Training Facility sale to FY 2009-10 and a $45 million GO bond program to a November 2010 election. This option would get the fund balance positive until FY 2012-2013. Recommendation and Next Steps Staff recommended Option E which would delay the planned $25.7 million GO/CO bond sale including the Public Safety Training Facility until FY 2009-10; $45 million GO bond program. The uncertainty of the economic assumptions had the potential to drastically alter financial capacity. Projects from 2005 were still ongoing. Delay a bond election to November 2010 at the earliest. Delays beyond this date might be necessary depending on economic circumstances. Re-evaluate the recommendation once the certified appraised values were known. The preliminary appraised values would be available in May 2009 and the certified appraised values would be released in July 2009. Mayor Burroughs asked if any of the proposed GOs were tied to state or regional funding such that the City might lose opportunities to participate in grant matches. Langley stated that some of the proposed projects might get revenues back from the state. They would have to look at them on a case by case basis and look for ways to participate. City Manager Campbell stated that there were some non-allocated bond funds that could be used in those types of situations. Council Member Heggins stated that a delay was not a denial of the projects especially with Public Safety Training Facility. Langley stated that the delay for one year was due to the economic conditions with the hope to issue the debt the following year. If Council wanted to change the tax rate there would be more capacity to issue debt. Consensus of the Council was to proceed with Option E. Following the completion of the Work Session, the Council convened in Open Session to consider the following: City of Denton City Council Minutes January 13, 2009 Page 5 1. The Council considered adoption of an ordinance accepting competitive bids and awarding a public works contract for the construction of the Roselawn elevated water storage tank; providing for the expenditure of funds therefor; and providing an effective date (Bid 4207– awarded to the lowest responsible bidder meeting specification, Landmark Structures I, L.P. in the amount of $5,146,000). The Public Utilities Board will consider this item at its January 12, 2009 meeting. Frank Payne, City Engineer, presented background information on Items 1 &2. Bids for the project were structured with a base bid for a 2.5 MG capacity, 35-foot head range tank and an alternative bid for a larger 3.0 MG, 40 foot head range capacity. Water Utilities pursued pricing on the alternative bid in the interests of evaluating the ability to obtain additional service delivery volume at the current outer reaches of the distribution system while taking advantage of the base bid pricing. Staff recommendation was for the 3.0 MG, 40 foot head range tank with the inclusion of Additive Alternate 2 for staircase access. A projected completion date was prior to the summer of 2010 (late June) as best value would be realized if it were completed before the summer peak in late July. Payne stated that the primary intent of the change order for Item #2 was to construct the elevated storage tank’s feed line as a part of the water line contract in order to take advantage of favorable pricing on the pipe. In addition, the project originally included the construction of permanent barbed wire fencing across the property owned by Rayzor Investments. Rayzor Investments had since notified the City that they would prefer to construct their own fencing on this property. The deletion of this work from the contract would result in a net decrease of $15,295.00. The following ordinance was considered: NO. 2009-020 AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING A PUBLIC WORKS CONTRACT FOR THE CONSTRUCTION OF THE ROSELAWN ELEVATED WATER STORAGE TANK; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. Mulroy motioned, Kamp seconded to adopt the ordinance. On roll vote, Heggins “aye”, Kamp “aye”, Moreno “aye”, Mulroy “aye”, Thomson “aye”, Watts “aye”, and Mayor Burroughs “aye”. Motion carried unanimously. 2. The Council considered adoption of an ordinance authorizing the City Manager to execute Change Order Number One to the contract between the City of Denton and Fox Contractors, Inc.; providing for the expenditure of funds therefor; and providing an effective date (Bid 3971–Roselawn 24-Inch Water Line Change Order Number One in the amount of $67,089.75). The Public Utilities Board will consider this item at its January 12, 2009 meeting. The following ordinance was considered: City of Denton City Council Minutes January 13, 2009 Page 6 NO. 2009-021 AN ORDINANCE AUTHORIZING THE CITY MANAGER TO EXECUTE CHANGE ORDER NUMBER ONE TO THE CONTRACT BETWEEN THE CITY OF DENTON AND FOX CONTRACTORS, INC.; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. Mulroy motioned, Heggins seconded to adopt the ordinance as presented. On roll vote, Heggins “aye”, Kamp “aye”, Moreno “aye”, Mulroy “aye”, Thomson “aye”, Watts “aye”, and Mayor Burroughs “aye”. Motion carried unanimously. 3. The Council considered approval of a resolution of the City Council of the City of Denton, Texas, appointing a primary and alternate member as an official voting representative to the Regional Transportation Council (RTC) of the North Central Texas Council of Governments; and providing an effective date. Mark Nelson, Transportation Director, stated that this resolution would affirm Pete Kamp as the primary member and Mark Burroughs as the alternate member to the Regional Transportation Council. The following resolution was considered: NO. R2009-003 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, APPOINTING A PRIMARY AND ALTERNATE MEMBER AS AN OFFICIAL VOTING REPRESENTATIVE TO THE REGIONAL TRANSPORTATION COUNCIL (RTC) OF THE NORTH CENTRAL TEXAS COUNCIL OF GOVERNMENTS; AND PROVIDING AN EFFECTIVE DATE. Mulroy motioned, Watts seconded to approve the resolution. On roll vote, Heggins “aye”, Kamp “aye”, Moreno “aye”, Mulroy “aye”, Thomson “aye”, Watts “aye”, and Mayor Burroughs “aye”. Motion carried unanimously. With no further business, the meeting was adjourned at 5:20 p.m. _________________________________ MARK A BURROUGHS MAYOR CITY OF DENTON, TEXAS _________________________________ JENNIFER WALTERS CITY SECRETARY CITY OF DENTON, TEXAS