City Council

CITY OF MOUNT VERNON CITY COUNCIL MEETING AGENDA October 27, 2021, 7:00 p.m. Police Court Campus, 1805 Continental Place (Masks are required regardless of vaccination status) To virtually attend the meeting, the public may: 1. Call the conference line: 1-888-924-9240; Access Code: 3366211 (please ‘mute’ your phone, if possible, to minimize distractions) 2. Watch the meeting live on TV10: Comcast/Xfinity Channel 10 3. Watch the meeting live, online: https://www.youtube.com/channel/UCUob_hcQUmd4S93YkletdrA I. OPENING CEREMONIES A. Call to Order B. Pledge of Allegiance C. Roll Call of Councilmembers II. CONSENT AGENDA A. Approval of October 13, 2021 Regular Council Meeting Minutes B. Approval of October 20, 2021 Study Session Minutes C. Approval of October 20, 2021 payroll checks numbered 110991 - 111013, direct deposit checks numbered 84608 - 84841, and wire transfers numbered 1025 - 1029 in the amount of $1,215,986.73 D. Approval of October 27, 2021 Claims numbered 15466 -15644 in the amount of $1,512,566.59 III. REPORTS A. Committees 1. Finance & Parks and Enrichment Services 2. Development Services B. Community Comments 1. Review of Emails from the Public (Public comments may be sent via email to council@mountvernonwa.gov. The comments will be read aloud into the record during the public comment portion of the agenda. Please limit your comments to be read in three minutes or less. Email comments must be received by 4 p.m. on October 27, 2021.) 2. Public Comments (This is an opportunity for Mount Vernon residents to address their City Council. Please limit comments to three minutes or less. Under normal circumstances, the Mayor and Council will not respond immediately to Community Comments. If you would like someone to follow-up with you regarding the topic of your comments, please leave your name and contact information on the form at the entrance of the Council Chambers.) Mount Vernon City Council Agenda October 27, 2021, Page 2 of 3 C. Councilmember Comments D. Mayor’s Report E. Committee Agenda Requests IV. UNFINISHED BUSINESS None V. NEW BUSINESS A. Public Hearing for 2022-2027 Capital Improvements Plan (This is an open record public hearing to consider adoption, by ordinance the 2022-20278 Capital Improvements Plan.) (required action – ordinance) (staff contact – Peter Donovan) B. Public Hearing - 2022 Property Taxes (This is a public hearing to review revenue estimates for the 2022 budget, allow testimony, and to discuss with Council setting the 2022 property taxes for the City.) (required action – ordinance) (staff contact – Doug Volesky) C. Public Hearing – 2022 City Budget (This is a public hearing to present, allow testimony and to consider adopting the 2022 City Budget.) (required action – ordinance) (staff contact – Doug Volesky) D. Approval of Resolution – 2021 Surplus Equipment (Staff is requesting approval of a resolution declaring equipment surplus and authorize the sale at auction or disposal as scrap ) (required action – resolution) (staff contact – Gary Owens) E. Approval of Agreement with City of Burlington (Staff is requesting approval of an agreement with the City of Burlington for Public Defense Program assistant services) (required action – motion) (staff contact – Peter Donovan) F. Approval of Agreement Mount Vernon Downtown Association (Staff is requesting approval of an agreement with the Mount Vernon Downtown Association for CDBG Microenterprise Funds.) (required action – motion) (staff contact – Peter Donovan) G. Approval of Resolution – Catholic Housing Services Funding (Staff is requesting approval of a resolution to provide funding for Catholic Housing Services.) (required action – resolution) (staff contact – Peter Donovan) H. Approval of an Agreement with Skagit County (Staff is requesting approval of an amendment to agreement 2889, Jail Interlocal Agreement, that adjusts the timing and communication of required additional payments by the jail city partners to better fit with both City and County budget and cash flow needs.) (required action – motion) (staff contact – Doug Volesky) I. Approval of Agreement with BERK and Associates (Staff is requesting approval of an agreement with BERK and Associates to complete the HOVEE Study Update) (required action – motion) (staff contact – Chris Phillips) Mount Vernon City Council Agenda October 27, 2021, Page 3 of 3 J. Approval of Agreement with Woodcraft Wood Flooring (Staff is requesting approval of an agreement with Woodcraft Wood Flooring to refinish wood floors at Hillcrest Park Lodge.) (required action – motion) (staff contact – Jennifer Berner) K. Approval of Agreements with Skagit County Dike District 3 (Staff is requesting approval of interlocal agreements with Skagit County Dike District 3 for the funding, operations, and easement related to downtown flood protection services.) (required action – motion) (staff contact – Kevin Rogerson) L. Approval of Agreement with West Publishing (Staff is requesting approval of a subscription agreement with West Publishing for online legal research.) (required action – motion) (staff contact – Kevin Rogerson) COMMITTEE MEETINGS Finance & Parks and Enrichment Services 6:00 p.m. Next Ordinance 3837 Next Resolution 1001  AGENDA ITEM: A DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Peter Donovan, Project Development Manager SUBJECT: OPEN RECORD PUBLIC HEARING FOR 2022-2027 CAPITAL IMPROVEMENTS PLAN (CIP) RECOMMENDED ACTION: Hold the required Open Record Public Hearing on the CIP for the period 2022-2027. Following the Public Hearing, staff recommends that Council move to approve, or modify, the Ordinance amending the Comprehensive Plan for the City by updating the Capital Improvements Plan for the Period 2022-2027 INTRODUCTION/BACKGROUND: -The draft CIP for 2022-2027 is proposed as our yearly update to the Capital Facilities Element of the Comprehensive Plan. -The CIP is a six-year plan of capital projects with estimated costs and proposed methods of financing that is updated annually. -The Washington State Growth Management Act requires jurisdictions fully planning under the GMA to include a capital facilities plan element in their comprehensive plans (RCW 36.70A.070(3)). The capital facilities element is required before a jurisdiction can impose GMA impact fees. -The process begins with Department Heads submitting their capital requests, and then the Mayor and her support staff meet with applicable Department Heads to review their requests in detail, and revise as necessary. The draft CIP is then assembled and a) sent to the Department of Commerce for a 60-day review prior to City Council Public Hearing, b) taken before the Planning Commission as a Public Hearing for review and recommended approval, and c) subsequently taken before City Council as a Public Hearing for review and recommended approval. -Planning Commission has reviewed the CIP in a public meeting, on October 5, 2021 -The Planning Commission approved and recommends the 2022-2027 CIP, after a public hearing on October 5, 2021. -The City Council CIP Public Hearing is October 27, 2021. -Please note that we have again included a section in this year’s CIP titled, “Top Two Priority Projects” from each Department that includes applicable pictures or visual aids. FINDINGS/CONCLUSIONS: Staff has followed the extensive and collaborative process that is prescribed for updating the City’s CIP. The Mayor has approved the updates. The Mount Vernon Planning Commission has held a public hearing, prior to approving the draft, and have recommended the 2022-2027 CIP to Council for final approval. RECOMMENDATION: Following a Public Hearing, Staff recommends approval of the 2022-2027 Capital Improvements Plan. ATTACHED: -Draft Ordinance -2022-2027 Capital Improvements Plan  AGENDA ITEM: B DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Doug Volesky, Finance Director SUBJECT: REVIEW REVENUE SOURCES AND DISCUSS SETTING 2022 PROPERTY TAXES RECOMMENDED ACTION: Staff recommends that Council adopt an ordinance to establish the 2022 property tax revenue amount. INTRODUCTION/BACKGROUND: A major part of the City’s budget process is establishing revenue estimates for the budgeted year. The City’s revenue policies include: 1. Current revenues will be sufficient to support current expenditures, 2. Calculated using an objective, analytical process, and will be neither overly optimistic nor overly conservative, 3. Estimates will be performed utilizing accepted analytical techniques, and shall access the full spectrum of resources available to finance City programs and services. Estimated total revenue included in the 2022 Preliminary Budget is $76,831,204. This is an increase of $2,404,504 or 3.2% from the City’s 2021 budgeted revenue amount. This increase is due mainly to higher projected budgeted revenues of $1,200,000 in sales tax, $481,000 in public safety sales tax and $870,000 in new revenues from the affordable housing sales and use tax. Total taxes are increasing by $2,315,407 which include the above sales tax numbers. Utility taxes are estimated to increase by $156,236 and Hotel/Motel taxes are increasing by $80,000 from the budgeted 2021 revenue amounts. Per MRSC, “As part of the budget process, the taxing jurisdiction establishes the amount of property tax revenue needed to fund the budget. That amount needed to fund the budget is called the levy. It is the total amount to be collected from the taxpayers by a taxing district. In Washington, property tax increases are not based on the increasing value of properties. They are based on last year’s property tax levy, which is simply the amount of the property taxes that were assessed in the prior year. By November 30 of each year, the amount of taxes to be levied by taxing districts are certified to the county assessor in a dollar amount. In Mount Vernon, our tax levy amount in 2021 was $8,110,167. The county assessor calculates the levy rate necessary by dividing the total levy amount by the assessed value of taxable property in the district. By law, this number is expressed in terms of a dollar rate per $1,000 of valuation. For example, a rate of $0.00025 is expressed as 25¢ per $1,000 of assessed value. The formula for property tax collections is expressed as: Levy = Levy Rate x Assessed Value (AV)”. The City of Mount Vernon is required by law to hold a public hearing to review revenue sources for the coming year and also to set property taxes for the coming year. The City’s property tax increase is limited to the lesser of one percent (1%) or the implicit price deflator (IPD) for the year. Additionally, a City may capture 100% of all new construction and may take any “banked capacity” available to them. Some important facts to consider when setting the 2022 property tax include: 1. The implicit price deflator (IPD) for the year is 3.86%, so it is more than 1%, so tax districts will be allowed to levy 1% more than they collected in 2021. A 1% adjustment to the property tax is $81,102. This amount is not included in the 2022 Preliminary Budget. 2. Banked Capacity. As a result of the City of Mount Vernon not taking the maximum regular tax which could lawfully be levied in past years, the City has accumulated banked levy capacity of $778,567. The amount of banked capacity changes each year because the highest lawful levy and the actual levy are recalculated. Having banked capacity for one year does not guarantee the city will have the same amount the following year. There is no banked capacity included in the 2022 revenue budget. 3. New construction value per the County Assessor’s Office is $45.1M which will generate $89,786 of new revenue to the City in 2022. The new construction has been included in the 2022 Preliminary Budget. The City was also notified of an available refund levy totaling $15,761 which is also included. FINDINGS/CONCLUSIONS: City staff recommends that City Council: - Set the property taxes in 2022 at 100% of the 2021 revenue amount, - Take all new construction and available refunds allowed to the City. RECOMMENDATION: City staff recommends Council adopt ordinance to set the City’s 2022 property tax levy amount. ATTACHED: 2022 Property Tax Levy amount Ordinance.  AGENDA ITEM: C DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Doug Volesky, Finance Director SUBJECT: PUBLIC HEARING ON THE 2022 CITY BUDGET RECOMMENDED ACTION: The City will hold a public hearing to present and take comment on the 2022 City budget. INTRODUCTION/BACKGROUND: The City of Mount Vernon is required to hold a public hearing to discuss the 2022 proposed budget. Following a public hearing and discussion of the proposed budget, City Council may then adopt the budget which must be adopted prior to the beginning of the ensuing year. FINDINGS/CONCLUSIONS: The attached preliminary budget document with the Mayor’s submittal letter summarizes the detailed information Council has in their 2022 budget binders. During discussions with City Council there have been some adjustments to the preliminary budget document. These items include adjustments in budgeted revenues to reflect projected property tax revenues based on updated assessed values provided by Skagit County. This public hearing will include the updated budget numbers. The City budget as proposed consists of 41 funds and supports 244 full time and approximately 45 part- time employees. The total 2022 proposed budget for the City of Mount Vernon is $76,705,623, which is an 1.3% increase compared to the 2021 budget. Total governmental operating fund budgets for 2022 total $39,291,463, a 9.0% increase compared to 2021. The preliminary budget will continue to be adjusted per Council’s direction prior to adoption, with a detailed list of these adjustments. The attached preliminary budget document has not been adjusted for these modifications. RECOMMENDATION: - No action required, or - Staff recommends Council adopt the 2022 budget ordinance ATTACHED: - 2022 Budget Ordinance - 2022 Preliminary Budget Document  AGENDA ITEM: D DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Gary Owens, Equipment Maintenance Manager SUBJECT: 2021 SURPLUS EQUIPMENT RECOMMENDED ACTION: City staff recommends City Council approve a Resolution declaring equipment surplus to City’s needs and authorizing the sale of these at auction or disposal as scrap. INTRODUCTION/BACKGROUND: Staff have determined that certain vehicles and equipment are either no longer usable or are surplus to the needs of any City department. All City departments have had the opportunity to add any of the items on the attached list to their asset list through interdepartmental trade. FINDINGS/CONCLUSIONS: Certain pieces of equipment or vehicles are no longer usable or are surplus to the needs of the City and should be declared surplus. RECOMMENDATION: Staff recommends that Council approve this Resolution authorizing the surplus of city vehicles and equipment to be sold at auction or disposed of as scrap. ATTACHED: Proposed resolution  AGENDA ITEM: E DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Peter Donovan, Project Development Manager SUBJECT: AGREEMENT FOR PUBLIC DEFENSE PROGRAM ASSISTANT SERVICES RECOMMENDED ACTION: Motion INTRODUCTION/BACKGROUND: The cities of Mount Vernon and Burlington have contracted together for the past 5 years to provide enhanced public defense services through the employment of a Public Defense Program Assistant. FINDINGS/CONCLUSIONS: This agreement renews the existing interlocal agreement for continued services, and updates the job description of Public Defense Program Assistant for the cities. The salary range is also updated from the present 2015 salary schedule ($15-$20/hour) to the 2021 salary schedule ($21.44-$27.44/hour). RECOMMENDATION: Motion to authorize the Mayor to enter into this interlocal agreement with the City of Burlington for Public Defense Program Assistant Services ATTACHED: Draft Interlocal Agreement  AGENDA ITEM: F DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Peter Donovan, Project Development Manager SUBJECT: CDBG AGREEMENT WITH MV DOWNTOWN ASSOCIATION RECOMMENDED ACTION: Motion INTRODUCTION/BACKGROUND: In its 2020-21 CDBG Action Plan, the City of Mount Vernon allocated $12,500 in federal CDBG funding to the Mount Vernon Downtown Association (MVDA) for the purpose of Micro Enterprise Assistance. FINDINGS/CONCLUSIONS: MVDA will leverage the CDBG support to recruit, support and train CDBG-eligible business owners and provide resources for those businesses, such as rental assistance, broadband connection, and other business support. RECOMMENDATION: Motion ATTACHED: Memorandum of Understanding  AGENDA ITEM: G DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Peter Donovan, Project Development Manager SUBJECT: RESOLUTION TO SUPPORT PERMANENT SUPPORTIVE HOUSING RECOMMENDED ACTION: Resolution INTRODUCTION/BACKGROUND: --On August 26, 2020 City Council directed staff to work on an agreement that would essentially dedicate funding—made available through State HB1406—to operations of the 70-unit permanent supportive housing project being developed in Mount Vernon. --Catholic Community Services will operate the permanent supportive housing program. --On October 20, 2020 a letter of funding intent was sent to Catholic Community Services to inform the organization of the City’s intent to dedicate its 1406 collections of an estimated $64,000, annually, to help fund the operations at the permanent supportive housing facility. FINDINGS/CONCLUSIONS: --Catholic Community Services has received a permit to construct affordable/supportive housing located at 1925 East College Way --City Council has considered the income of the individuals and families to be served, the leveraging of the resources made available, and the housing needs within the City’s jurisdiction and has preliminarily decided that the provision of operations and maintenance services at Martha’s Place qualifies for the use of Affordable Housing Sales Tax. RECOMMENDATION: Council adoption of a resolution supporting Catholic Community Services Skagit County’s permanent supportive housing project through affordable and supportive housing sales and use tax funds. ATTACHED: --Draft Resolution --City Letter of Funding Intent to Catholic Community Services  AGENDA ITEM: H DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Doug Volesky, Finance Director SUBJECT: FOURTH AMENDMENT TO THE JAIL FACILITY USE AGREEMENT RECOMMENDED ACTION: A motion to approve the Fourth Amendment to the Jail Facility Use Agreement with Skagit County. INTRODUCTION/BACKGROUND: On July 17th, 2013, Council approved the Jail Facility Use Agreement with Skagit County, and the Cities of Mount Vernon, Anacortes, Burlington, and Sedro-Woolley. This agreement laid out the framework of a use and financing agreement for the construction and operation of the new Skagit County Jail Facility. On January 8th, the parties to the agreement met in open session to discuss the timing of additional payments to the Jail Fund in the event there is a shortfall that causes the Revenue Stabilization Account (RSA) to fall below the Minimum Funding Threshold (MFT). The original agreement sets a schedule for payments that has large fluctuations from year to year and could cause the Jail Fund to have an inadequate amount of cash for operations. The parties agreed that shortening the time between knowing the projected shortfall and funding it proportionately would avoid fluctuations caused by the original payment schedule. FINDINGS/CONCLUSIONS: The parties to the Jail Facility Use Agreement propose a fourth amendment to the agreement that alters the payment schedule to ensure additional payments to the Jail Fund made for any year are reconciled with the actual financial results for that year. Each party shall receive a reconciliation statement in August showing any overage or shortfall which will be credited or charged in May of the following year. Additionally, the exact amount of a party’s required additional financial contribution shall be determined by an October 31 Jail Model update to be included in the next year’s budget. The primary aim of this change is to reduce the years in which the Revenue Stabilization Account falls below the Minimum Funding Threshold ($3.9M as of December 31 of each year) and smooths the amount of the Additional Financial Consideration for all parties. This amendment will adjust the timing and communication of required additional payments by the Jail Partner Cities, to better fit with both City and County budget and cash flow needs. RECOMMENDATION: Staff recommends that City Council authorize the Mayor to enter into the Fourth Amendment to the Jail Facility Use Agreement with Skagit County and the cities of Mount Vernon, Anacortes, Burlington and Sedro-Woolley. ATTACHED: 1. Jail Facility Use Agreement 2. First Amendment to the Jail Facility Use Agreement 3. Second Amendment to the Jail Facility Use Agreement 4. Third Amendment to the Jail Facility Use Agreement 5. Fourth Amendment to the Jail Facility Use Agreement  AGENDA ITEM: I DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Chris Phillips, Development Services Director SUBJECT: HOVEE STUDY UPDATE CONTRACTOR SELECTION AND CONTRACT RECOMMENDED ACTION: City Staff recommends City Council authorize the Mayor to enter into an agreement with BERK to complete an update to the 2006 Hovee Study. INTRODUCTION/BACKGROUND: City Council authorized funding in the 2021 Budget for an update to the 2006 Hovee Study. The study will Following is a summary of the information to be updated: 1. Employment trends utilizing information from the 2006 study for baseline information, 2016 Comprehensive Plan for intermediate information and future forecast modeling to predict 2036 figures. 2. Jobs forecast utilizing information from the 2006 Study for baseline information, 2016 Comprehensive Plan for intermediate information and future forecast modeling to predict 2036 figures. 3. Land demand projections utilizing information from the 2006 Study for baseline information, 2016 Comprehensive Plan for intermediate information and future forecast modeling to predict 2036 figures. 4. Analysis on the optimum balance between jobs & residents within the City. Model should include current revenue (Sales and Property Taxes) expenditure projections to support services (Police, Fire, Public Works and Parks) for residential/commercial lands. Once the selected consultant has finished the requested updates the City requests analysis and recommendations on the following: a. Effects and recommendations of and/or for residential uses that include horizontal and vertical mixed-use, infill townhome, duplex, triplex and other MFR options in the General Commercial (C-2) and Commercial - Limited Industrial (C-L) zoning districts. b. Recommendations on quantity and distribution of residential, commercial, industrial, and public zoning districts throughout the City. FINDINGS/CONCLUSIONS: City received 3 bids for this project and after grading the submittals, City Staff recommends BERK and Associates to complete this extremely important study. RECOMMENDATION: City Staff strongly recommends City Council authorize the Mayor to enter into agreement with BERK for$69,000. ATTACHED: BERK Submittal Draft Contract AGENDA ITEM: J  AGENDA ITEM: K DATE: October 27, 2021 TO: Mayor Boudreau and City Council FROM: Kevin Rogerson, City Attorney SUBJECT: Proposed Interlocal Agreements and Easement Agreement with Dike District 3 RECOMMENDED ACTION: Motion. That the Council authorize the Mayor to enter into the following contracts with Dike District No. 3 (the “District”): a) an interlocal agreement for the operation of the downtown flood project (the “Project”), b) an interlocal agreement transferring funds related to costs incurred by the City for the Project, and c) an easement agreement conveying an easement over the Project’s flood elements and the transfer of necessary personal property. INTRODUCTION/BACKGROUND: The District and the City have been working cooperatively for many years toward the goal of providing the City’s downtown area with a permanent flood project. 1 The Project provides a baseline level of protection for the one-hundred-year (or greater) flood event. As part of previous agreements, at the time the Project reaches completion, ownership and the attendant responsibilities for repair and maintenance of the flood elements of the Project are to be conveyed over to the District (subject to conditions) while the City retains ownership of any property interest surplus to that effort (for example, the promenade and trail, property acquired, but no longer needed for the Project, other open space not needed for flood efforts, parking, and public restrooms). Completion of the documents necessary for such a conveyance has concluded. After discussing terms and conditions for such a transfer (including form of deed, operational interlocal agreements, and further funding) the Parties have proposed the following agreements for council approval. 1. An Agreement for Flood Protection Services. The agreement stipulates that the City will continue to maintain, repair and perform routine operations of the flood improvement elements of the Project as it is currently providing. The City shall be reimbursed annually for the actual costs (time, materials, and any storage fees when the City does not have surplus space) for such Services. Invoices will be provided in September for services of the previous year and payment due within sixty days. 1 The City previously entered into a number of interlocal agreements throughout the years. This history is set within the proposed operational agreement. This is included in Section D of the Recitals.  2. An Interlocal Cooperative Funding Agreement. The City is still expending revenues and incurring costs as a direct result of the Project. This agreement contributes to the costs of these efforts incurred by the City in the amount of $2,189,299.36 to be paid in annual installments set forth in Section 3.3 through June 1, 2025. 3. An Easement Agreement and Transfer of Personal Property. Pursuant to performing the terms and conditions of the funding agreements with the District, the City is to convey by easement the necessary property rights over the flood elements of the Project to the District. In addition, all improvements, fixtures and personal property related to the flood mitigation have been identified, inventoried (as set forth in the attached bill of sale) and will be transferred to the District. The agreement, to be recorded with the Skagit County Auditor, conveys all such rights to the District reserving to the City all remaining property rights. The District has approved the agreements to be put into final form for their signatures at their November meeting. FINDINGS/CONCLUSIONS: That the execution of agreements as previously described serves the public interest in general, as well as the City’s interests. RECOMMENDATION: That the City Council authorizes the Mayor to enter into the interlocal agreements (contributing funds toward the completion of the Downtown Flood Project and related to operations of the flood elements) and easement agreement with District No. 3. AGENDA ITEM: L