_Board of Commissioners

CITY OF NEWPORT, KY REGULAR MEETING OF THE BOARD OF COMMISSIONERS May 23, 2022, 7:00 PM Minutes CALL TO ORDER The meeting was called to order by Mayor Guidugli, on Monday, May 23, 2022, 7:00 PM. The public had access to the live stream meeting through the City of Newport, KY Facebook Page Facebook.com/CityofNewportKY and YouTube/CityofNewportKY. In Attendance: Mayor Thomas L. Guidugli Jr., Vice Mayor Frank Peluso, Commissioner Beth Fennell, Commissioner Jerry Peluso Commissioner Rechtin. Others Present: City Manager Thomas Fromme, Assistant City Manager John Hayden, City Attorney Dan Braun, Deputy City Clerk Joy Rovno, Chief of Police Christopher Fangman, Chief of Fire/EMS Frank Peluso. The first 11:20 minutes are without audio, the minutes are as follows: PRESENTATIONS, AWARDS, PROCLAMATIONS None PERSONNEL ORDERS None PUBLIC FORUM Erin Sizemore introduced herself and announced she is a candidate for District Court Judge. Page 1 of 8 BOC Minutes 05-23-2022 APPROVAL OF MINUTES  Regular Meeting Minutes April 25, 2022 Vice Mayor Peluso made a motion to approve the April 25, 2022 Regular Meeting Minutes; Commissioner Fennell offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 5-0 OLD BUSINESS None NEW BUSINESS COMMISSIONERS ORDER NO. R-2022-033 AN ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF NEWPORT, KENTUCKY, AUTHORIZING THE CITY MANAGER THOMAS J. FROMME TO ACCEPT THE BIDS OF VARIOUS SUPPLIERS FOR THE DEPARTMENT OF COMMUNITY SERVICES PURSUANT TO BIDS RECEIVED MAY 5, 2022 Thomas Fromme gave a brief explanation of the bids and suppliers. Vice Mayor Peluso noticed no bids were submitted for stripping and asked for the list of suppliers that were sent the bid information. Thomas Fromme replied he would get the information to Vice Mayor Peluso. Vice Mayor Peluso made a motion to approve Order R-2022-033; Commissioner Fennell offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 5-0 Page 2 of 8 BOC Minutes 05-23-2022 COMMISSIONERS ORDER NO. R-2022-034 AN ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF NEWPORT, KENTUCKY AUTHORIZING MAYOR THOMAS L. GUIDUGLI, JR. TO EXECUTE A MUNICIPAL ROAD AND COOPERATIVE PROGRAM AGREEMENT WITH THE COMMONWEALTH OF KENTUCKY TRANSPORTATION CABINET, DEPARTMENT OF RURAL AND MUNICIPAL AID REGARDING MUNICIPAL ROAD AID FUNDS FOR THE FISCAL YEAR COMMENCING JULY 1, 2022, AS PROVIDED FOR IN THE KENTUCKY STATE STATUTES, AND ACCEPTING ALL STREETS REFERRED TO THEREIN AS BEING PART OF THE CITY OF NEWPORT Thomas Fromme gave an explanation of the funds. He stated these funds are used for street and road repairs within the city. He went on to say the city receives these funds each year, which are a tremendous help to maintain city streets, roads and bridges. He gave an example of the Waterworks Road bridge repair that without these funds would have been a burden on the city. Commissioner Fennell made a motion to approve Order R-2022-034; Commissioner Rechtin offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 5-0 COMMISSIONERS ORDER NO. R-2022-035 AN ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF NEWPORT, KENTUCKY, AUTHORIZING THE ISSUANCE OF UP TO $20,000,000 MAXIMUM AGGREGATE PRINCIPAL AMOUNT TAXABLE INDUSTRIAL BUILDING REVENUE BONDS, SERIES 2022 (OVATION MUSIC OFFICE PROJECT), IN ORDER TO ASSIST OVATION OFFICE 100, LLC, OR ASSIGNS, TO FINANCE THE ACQUISITION, CONSTRUCTION AND EQUIPPING OF AN INDUSTRIAL BUILDING FACILITY LOCATED WITHIN THE CITY OF NEWPORT, KENTUCKY AND TO IMPROVE SAID FACILITY; AUTHORIZING THE ISSUANCE OF ADDITIONAL BONDS; PROVIDING FOR THE PLEDGE OF REVENUES FOR THE PAYMENT OF SAID BONDS; AUTHORIZING A LEASE AGREEMENT BETWEEN THE CITY OF NEWPORT, KENTUCKY AND OVATION OFFICE 100, LLC, OR ASSIGNS, WITH RESPECT TO THE FACILITY; AUTHORIZING A TRUST INDENTURE APPROPRIATE FOR THE PROTECTION AND DISPOSITION OF SUCH REVENUES AND FURTHER TO SECURE THE PAYMENT OF SAID BONDS; AUTHORIZING A BOND PURCHASE AGREEMENT; AND AUTHORIZING A HOME OFFICE PAYMENT AGREEMENT. Page 3 of 8 BOC Minutes 05-23-2022 Thomas Fromme stated this is a bookkeeping item; the city has already committed to these bonds with the existing inducement resolution. This order allowed the city to issue these bonds, which the city has done. The bonds have also been approved through a bond hearing at the State Governors Office. This is the next step in the approval process; there will be more of these as the Ovation continues to be built. Commissioner Fennell asked if this is for the office and industrial building. Thomas Fromme replied this is specifically for the office building. Commissioner Fennell asked why this is named as an industrial facility. Thomas Fromme replied it’s the language of the KRS, it’s not an industrial building it’s an office building. Commissioner Fennell asked how much staff time is used on the bonds. Thomas Fromme replied staff has a good relationship with the attorneys for the developer and they are able to work efficiently together. Vice Mayor Peluso made a motion to approve Order R-2022-035; Commissioner Fennell offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 5-0 Page 4 of 8 BOC Minutes 05-23-2022 COMMISSIONERS ORDER NO. R-2022-036 AN ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF NEWPORT, KENTUCKY, AUTHORIZING THE ISSUANCE OF UP TO $18,000,000 MAXIMUM AGGREGATE PRINCIPAL AMOUNT TAXABLE INDUSTRIAL BUILDING REVENUE BONDS, SERIES 2022A; TAXABLE SPECIAL OBLIGATION REVENUE BONDS, SERIES 2022B, AND TAXABLE SPECIAL OBLIGATION REVENUE BONDS, SERIES 2022C, IN ORDER TO ASSIST NEWPORT ELEVEN, LLC, OR ASSIGNS, TO FINANCE THE ACQUISITION, CONSTRUCTION AND EQUIPPING OF AN INDUSTRIAL BUILDING FACILITY AND RELATED INFRASTRUCTURE IMPROVEMENTS LOCATED WITHIN THE CITY OF NEWPORT, KENTUCKY AND TO IMPROVE SAID FACILITY; PROVIDING FOR THE PLEDGE OF REVENUES FOR THE PAYMENT OF SAID BONDS; AUTHORIZING A SPRINGING EXECUTORY INTEREST DEED; AUTHORIZING TRUST INDENTURES APPROPRIATE FOR THE PROTECTION AND DISPOSITION OF SUCH REVENUES AND FURTHER TO SECURE THE PAYMENT OF SAID BONDS; AUTHORIZING A BOND PURCHASE OR BOND PLACEMENT AGREEMENT; AUTHORIZING A PILOT MORTGAGE TO SECURE PILOT PAYMENTS; AUTHORIZING HOME OFFICE PAYMENT AGREEMENTS, AND AUTHORIZING THE EXECUTION OF ANY FURTHER NECESSARY INSTRUMENTS. Thomas Fromme stated this is for the 11th Street residential development. This development goes through the same process as the previous order. The city had already approved this inducement order back in 2021 and it has also been approved by the State Governors Office. The city does not incur any costs on any of these bonds. The city benefits by receiving PILOT payments as well as our school and county. Vice Mayor Peluso asked for clarification of the springing executory deed. Dick Spoor explained the springing executory deed. During the term of the bond, the city owns the property, but when the bond is paid the deed is transferred to the owner of the property. He gave examples of developments throughout the city that had the springing executory deed. Mayor Guidugli asked who created the springing executory deed. Mr. Spoor replied he and Mr. Marty Butler created this type of deed. Mayor Guidugli congratulated Mr. Spoor in creating this devise which is an incentive to developers which then carries over the city, county and schools and to our residents. Thomas Fromme stated these bonds are an economic benefit to our schools. He explained SEC funds are based on income. Page 5 of 8 BOC Minutes 05-23-2022 Commissioner Fennell agreed, she stated areas of higher income do not receive SEC funds. She stated the city could be affected in the future due to higher property values. Commissioner Rechtin asked Mr. Fromme to explain PILOT. Mr. Fromme explained PILOT is an acronym for Payment In Lieu Of Taxes our schools have the biggest benefit from these PILOT’s Commissioner Rechtin stated prior to an inducement contract a PILOT is determined by the city and developers. The developer pays a portion of the taxes. Thomas Fromme stated the developer pays PILOT payments, it’s expensive to develop in the urban environment, this is an incentive to bring developers to the city. Vice Mayor Peluso stated there is a misconception that with the issuance of these bonds the city is giving these developers something for nothing. All the developments and the dollar amounts the city and schools have received are more now and we all benefit from the improvements to the city. Thomas Fromme stressed the importance of business payroll to the city budget. Commissioner Rechtin made a motion to approve Order R-2022-036; Commissioner Peluso offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 5-0 DEPARTMENT HEAD COMMENTS None CITY MANAGER COMMENTS  Memorial Day Parade updates Page 6 of 8 BOC Minutes 05-23-2022 BOARD OF COMMISSIONERS COMMENTS Commissioner Rechtin  Congratulated all the successful candidates Commissioner Peluso  Thanked the Public Works Department for all they do. He read a list of the many things they do every day. He recognized Ray Ebert, Mark Hawkins, Rubin Vickers, Butch Stoelting, Clell Gabbard, Mike Wisner, Dana Dickerson, Dillion Carson, David Guidugli, Ken Vorhees Sr., Mike Bailey, Eugene Hamlin, and John Glenn and Brett Fennell. Commissioner Fennell  Asked citizens to reach out to neighbors that may need help cutting grass  Encouraged everyone to come to Italianfest June 9-13  Brent Spence bridge update, grant will be announced in the fall 2022, construction will take 4-5 years Vice Mayor Peluso  No comments Mayor Guidugli  The NBA legislative update on Wednesday at Jersey’s, legislation that took place in Frankfort this year.  Thanked everyone who participated in the democratic process, congratulated those who are moving forward and thanked those who worked and campaigned and did not achieve the votes. It takes all to make this system work. It takes all of our residents to vote to make it work. Continue to vote. Page 7 of 8 BOC Minutes 05-23-2022 ADJOURNMENT Vice Mayor Peluso made a motion to adjourn the meeting at 7:50PM; Commissioner Fennell offered a second to the motion. The Mayor called for a vote: Commissioner Beth Fennell Yes Commissioner Jerry Peluso Yes Commissioner Ken Rechtin Yes Vice Mayor Frank Peluso Yes Mayor Thomas Guidugli Jr. Yes Motion Carried 4-0 Date Approved/Signed Thomas L. Guidugli Jr., Mayor ATTEST: Joy Rovno, Deputy City Clerk Page 8 of 8 BOC Minutes 05-23-2022