City Council

Minutes of Work Session of Council of Ogden City, Utah, May 26, 2016 Page Minutes of the Work Session of the Ogden City Council held on Thursday, May 26, 2016 at 3:31 p.m., in the Council Work Room located on the third floor of the Municipal Building, 2549 Washington Boulevard, Ogden City, Weber County, Utah. Present: Chair Marcia L. White (participated via telephone) Vice Chair Bart E. Blair Council members Neil K. Garner Richard A. Hyer Luiz Lopez Ben Nadolski Doug Stephens Council Executive Director Bill Cook Council Deputy Director Janene Eller-Smith Council Policy Analyst Glenn Symes Communications Manager Amy Sue Mabey Also present: Chief Administrative Officer Mark Johnson Assistant City Attorney Mark Stratford Management Services Director David G. Buxton Comptroller Lisa Stout City Treasurer Brandee Johnson Deputy Finance Manager Camille Cook Public Services Director Jay Lowder City Engineer Justin Anderson Public Ways and Parks Manager Perry Huffaker Public Utilities Manager Kenton Moffett Deputy City Recorder Julia LaSeure The purpose of the Work Session was to hear presentations and discuss the following: Pioneer Days Foundation; FY2016 3rd Quarter Financial Report; FY2017 Proposed Budget; Public Services; Capital Improvement Plan; Utility Financial Model Updates; FY2016-2020 Capital Improvement Plan 3rd Quarter Report, and Council business. Pioneer Days Foundation presentation Pioneer Days Foundation representatives Dave Halvorson, Rodeo Director, and Desiree Cooper-Larsen, Past Chair, presented information regarding the Pioneer Days celebration to be held in July of 2016. Mr. Halvorson reported the Pioneer Days Rodeo has been nominated as a top five rodeo for large outdoor rodeos. He stated the purpose of his presentation is to discuss who will be coming to the rodeo and why and how the rodeo can be improved. He indicated he will also formalize the Foundation’s request for funding. He reviewed graphics indicating 56 percent of the Ogden Pioneer Days Rodeo spectators are female with 22 percent of them being between the ages of 30 to 39. He stated that is the rodeo’s target market. While 55 percent of spectators come from Weber County, over 25 percent come from other areas including Salt Lake City, Morgan and Box Elder Counties, Cache Valley, and St. George and 18 percent come from Davis County. He briefly reviewed the demographics of rodeo spectators, and the reasons that people attend rodeos. 78 percent of spectators would come to the rodeo without any invitation; 43 percent of them do so out of tradition. 22 percent attend the rodeo as an extra activity and the Foundation is focused on options for attracting a new audience. Ms. Cooper-Larsen clarified that two different surveys have been conducted. She explained one surveyed spectators and was conducted by a Weber State University (WSU) student at one of the entry gates of the stadium. The other surveyed rodeo participants and was conducted in the hospitality cabin. Mr. Halvorson noted that when the City Council agreed to sponsor the cowboy hospitality cabin they also indicated they wanted to be involved in meeting and greeting the rodeo participants. He said the participants ranked the hospitality, environment, and food offered at the cabin as excellent and that is one of the big reasons the rodeo draws quality participants and is ranked as one of the top five rodeos. Mr. Halverson discussed the Foundation’s funding request. He explained that in the past the City has contributed $5,000 toward the fireworks show on the 24th of July and the contribution for the cowboy hospitality cabin has varied throughout the years. This year the Foundation is requesting $10,000 for the cowboy hospitality cabin. He added that the Foundation has met with City Administration about the need to rebuild the north grandstand at the stadium and said doing that will provide additional seating and increase safety of the infrastructure. He reviewed a scope of work document for the project noting the total demolition and construction costs are $1,348,200. The Foundation has received $250,000 in seed money in Recreation Arts Museum and Parks (RAMP) funding and Mr. Halverson indicated other fundraising efforts for the project are underway. The Foundation would like to proceed with the project this fall in order for it to be complete prior to the 2017 Pioneer Days Rodeo. Ms. Cooper-Larsen concluded by noting the Pioneer Days celebration grows every year and the Foundation is always focused on taking it to another level. They want the City to be a destination for rodeo participants and spectators and they are proud of the involvement of the entire community. She stated she is very excited that the rodeo is ranked so high and mentioned it is one more tool that can be used to promote the City. Council member Stephens mentioned the demographic information included in the presentation and asked what the Foundation is doing to attract those with higher incomes as well as younger spectators. Mr. Halvorson replied a new marketing committee has been formed to examine demographics and attract spectators from all demographic groups. They will be advertising on social media and other outlets, but they still recommend offering family night and military appreciation night during which discounts will be offered for spectators. It is important to fill the stadium and sometimes it is necessary to offer discounts in order to do that. Council member Stephens stated that attracting those from higher income brackets will ensure the success of the event, but attracting the youth will provide longevity for the event; it is necessary to figure out some way to do both. Mr. Halvorson agreed and commented one thing that has been done to attract spectators is shortening the length of the rodeo to keep it fast paced and keep the attention of spectators. He indicated that adding motorcycles to the event has captured the younger demographic but it is attractive to all spectators. Council member Nadolski referred to the scope of work for the grandstand rebuilt project and asked for the total amount of funding the Foundation has already secured for the project. Mr. Halverson responded the Foundation has $246,000 in RAMP funding and Wadman Corporation has committed to contribute $80,000 to the project. Council member Nadolski indicated he is aware the Foundation made a request for funding to the Utah State Legislature and he asked if that request was successful. Mr. Halverson answered that the Foundation has not received an official response to that request, but if it is not successful this year the Foundation will continue to seek funding from the State. Council member Hyer asked about other events that are hosted at the stadium throughout the year. Mr. Halverson replied it would be best for City Administration to answer that question as he is not aware of all the events that are hosted there. He indicated he is aware that the number of events has increased greatly over the years and as the facility continues to improve, the number of events will continue to grow. Council member Nadolski asked if the City has identified a structural deficiency in the grandstand. City Engineer Anderson replied that each year a structural engineer is asked to conduct an analysis of the grandstand and each year he has indicated that though the grandstand is old, it is still structurally sound. Council member Stephens stated that 30 percent of the City’s population is Hispanic and asked if there are plans to market to that demographic. Mr. Halverson replied the marketing committee is very aware of the diversity in the City’s population and they market to that group of the population as well. He thanked the Council for their time and consideration. FY2016 3rd Quarter Financial Report Comptroller Stout indicated the Fiscal Year (FY) 2016 3rd Quarter Financial Report for the reporting period ending March 3, 2016 includes the following:  Fund Revenue & Expenditure Summary  General Fund Revenue Summary  General Fund Departmental Expenditure Summary  Special Assessment Funds Revenue & Expenditure Summary  Capital Improvement Fund Revenue & Expenditure Summary  Enterprise Funds Revenue & Expenditure Summary with Statement of Revenues, Expenses, and Cash Statement  Internal Service Funds Revenue & Expenditure Summary  Trust Funds Financial Information  Grant Funds Financial Information  RDA Fund Financial Information  MBA Fund Financial Information Ms. Stout provided an overview of the report, noting that it offers a comparison of budgeted and actual expenses as well as a comparison of revenue and expenses for each fund. Council member Hyer asked about the status of the Airport and Golf funds for this reporting period. Ms. Stout first referenced the Airport fund and responded that the operating expenses include depreciation. In a prior year the City received a grant, which was used to build a capital asset; however, that asset was not recognized as an expense and it is now being depreciated over time. The deprecation causes the fund to be negative, but depreciation is a non-cash expense. Council member Nadolski asked why the City is budgeting so little in depreciation yet the funds have a great deficit. Ms. Stout replied the City is not budgeting too little for depreciation, the actual revenues over expenses are the cause for the deficit. Depreciation of a capital asset must be recognized each year, but it is a non-cash activity. She explained it is accounted for as a loss, but it is a non-cash loss. Council member Nadolski stated depreciation in the Recreation Fund is very high and is causing a significant deficit. Ms. Stout answered that is likely a result of capitalization of a fixed asset in the prior FY that depreciation was not budgeted for. That issue will be corrected in years moving forward. Discussion continued regarding depreciation costs in various funds, including the Golf Fund and Storm Sewer Fund. Ms. Stout indicated the issues with depreciation can be corrected in the year-end budget opening. She added that the deficit in the Airport fund will be corrected by the end of the FY by a grant draw. Council member Nadolski asked how the grant draws are recognized in the budget. Ms. Stout answered they are recognized as capital outlay. Ms. Stout continued her review of the summary sheet for various funds including fund deficits in the Facilities, Fleet, and Stores Fund, the Risk Management Fund, and the Miscellaneous Grants and Donations Fund. She reviewed the General Fund Revenue Summary portion of the Report and noted that the City has a Revenue Committee that meets monthly to monitor revenues. The committee has determined the City will likely receive higher than budgeted revenues due largely to an increase in building activity in the City. Ms. Stout noted that delinquent property tax revenues are lagging behind the budgeted amount. She indicated the page of the report titled General Fund Departmental Expenditure Summary provides a budget breakdown for each fund in the City which allows City Administration to manage and track how budgets are being spent. FY2017 Proposed Budget Public Services and Capital Improvement Plan (CIP): Public Services Director Lowder made a PowerPoint presentation to provide the Council with information about the FY2017 proposed budget for his Department. He reported he is planning to implement merit increases for his employees using a pay for performance system, which is preferred by the employees in his Department. He indicated he plans to add the following positions to his Department in the coming year: three full time positions in the Engineering Division and one full time employee in the Public Ways and Parks Division. He explained the increase in staffing levels will not result in an increased budget because it will allow him to reduce expenses for costs currently paid to consultants or outside contractors in each of the two divisions. He stated he believes it will be possible to reduce engineering design costs by $500,000 by performing the work in-house and that money can be dedicated to other CIP projects. He indicated the addition of the employee in the Public Ways and Parks Division is in response to the Environmental Protection Agency (EPA) mandate known as the Fat, Oils, and Grease (FOG) program which the City is required to implement and monitor. City Engineer Anderson discussed the work to be done by the Engineering Division in the coming FY. He provided a brief scope of work for 10 CIP projects that will be underway in FY2017 including:  Sidewalk, Curb and Gutter Replacement  Street Construction  Bike Master Plan Projects  Valley Drive Slide Repair  Pave Pacific Boulevard  Grant Avenue Promenade  Skyline Parkway – Quail Run to 2600 South  North Street Improvements – Monroe to Washington  17th Street Reconstruction  Harrison Boulevard Widening Mr. Lowder noted the Streets, Sidewalks, Parks, and CIP Committee is in the process of making recommendations for a Sidewalk Master Plan. Mr. Anderson added the Engineering Division has methods for identifying and prioritizing sidewalks repairs. Areas of sidewalk in need of repairs are identified via resident requests or a City-wide inventory and the repairs are prioritized by ranking the area using the following labels: emergency, as soon as possible, high, moderate, low, or none. He indicated the Engineering Division has identified the City’s top 10 sidewalk priorities:  1325 Lincoln Avenue  1369 Jefferson Avenue  May 1st windstorm damaged sidewalk –17 locations  Canyon Road from Washington Boulevard to 900 block  Jefferson near 12th Street  Jefferson and 26thStreet  Vicinity of Heritage Elementary  Vicinity of Jaycee Park and Lions Club Park  Country Hills Drive  Washington Boulevard – missing sections north of North Street Council member Hyer asked whether the City has a program that allows residents to participate in sidewalk repair or replacement. Mr. Anderson answered yes and indicated the City has the 50/50 sidewalk program. The 50/50 program allows a resident and the City to split the cost of an approved sidewalk project. Council member Hyer stated it is important to market that program to residents. Mr. Anderson agreed and summarized the manner in which the program is being advertised to residents. The Council discussed the top 10 sidewalk projects to gain an understanding of the scope of work to be completed at each location and the reasons the various areas were included on the list of high priority projects. Mr. Lowder discussed projects to be completed in the Public Ways and Parks Division. The Liberty Park project is scheduled to be completed this summer with additional projects underway at Mt. Lewis Park (Edison Elementary), Lester Park, and the High Adventure Park. Transportation tax revenue will be used for the following projects in the Public Ways and Parks Division:  Curb, Gutter, and Sidewalk – $522,750  36th Street and Quincy Avenue signal replacement –$183,200  Street construction – $555,550  Transportation Master Plan – $350,000 Mr. Lowder added the Public Ways and Parks Division will complete sanitary sewer and storm sewer capital projects as well. He stated he does not anticipate any rate adjustments for sanitary sewer in the near future and the following projects should be completed: 975 East Sewer and 12th Street and Washington Boulevard Slip Line. Mr. Anderson briefly reviewed the scope of work for the two sanitary sewer projects. Mr. Lowder commented that he does expect rate adjustments in storm sewer in the near future and the following storm sewer utility capital projects have been or will be completed.  33rd Street and Pacific Avenue – complete  Weber & Ogden River Restoration  17th Street Lift Station – complete  5 Points Storm Water Diversion  Harrison Flooding – complete  9th Street Flooding & Downs and West Oaks Drive  2nd Street – Harrison Boulevard to Monroe Boulevard Mr. Lowder mentioned refuse and stated staff continues to work to develop the refuse utility rate model study and are also engaged in discussions regarding the current Weber County Transfer Station. He stated the transfer station has operational shortfalls that the City and other cities are very interested in correcting. Solutions will be incorporated into the refuse utility rate study. Mr. Lower talked about recreation and noted the Recreation Master Plan contract has been executed and staff is preparing for a meeting with the steering committee and the City’s design consulting firm. The following recreation capital projects are underway and nearing completion or will be underway soon.  4th Street Park Seating  Lorin Farr Bathhouse Upgrades  Marshall White Center o New Programs o Center Improvements Mr. Lowder discussed the Water Utility Division. He indicated he expects FY2016 water sales revenue to reach $17,990,025, which is a significant increase over FY2015 of $17,099,880. The following water utility capital projects have been or will be completed: Monroe Water Line, Fixed Base Metering, and 23rd Street to 25th Street water lines. The Council thanked Mr. Lowder and Mr. Anderson for the information provided. Regarding the CIP, Council Policy Analyst Symes asked about the City funded CIP anticipated Federal Aviation Agency (FAA) grant match of $100,000 for the Airport. Deputy Finance Manager Cook replied there are two Airport CIP projects. She noted that due to an increase in the number of flights and passengers going through the Ogden Airport, the City is eligible for a $1 million grant each year to be used for runway improvement. Due to the timing of the grant period, the City has the opportunity to receive two $1 million grants in FY2017, though in the future the City will receive just one grant per year. She stated Administration is proposing a transfer of $136,250 from Business Depot Ogden (BDO) lease revenue funds to be used as matching funds for the first $1 million grant that will be used for the Airport Northwest Access/Perimeter Road project. The second grant will be made available in the spring of 2017. City Administration is not currently aware of the project that FAA will request be completed with that fund. The City will need to provide a 10 percent match for that grant as well. Utility Financial Model Updates Cody Deeter of Lewis Young Robertson and Burningham (LYRB) showed a presentation to the Council regarding the City’s Comprehensive Financial Sustainability Plan. The updates to the Plan include updated 2015 data as well as 2016 estimates. They also contemplate the refinancing of the 2008 and 2009 bonds, which impact the Water Utility Fund, Sewer Utility Fund, and Storm Sewer Utility Fund. All funds appear fiscally healthy and no rate increases are needed at this time. He discussed the Water Utility Fund and noted the last scheduled rate increase occurred in 2015. Additional increases will be based upon the Consumer Price Index (CPI). Capital projects in the Water Utility Fund total $71 million over the next 10 years. $39 million will be spent on pipe replacement, $17 million on the 36-inch canyon pipeline, $10 million on wells and well field preservation, and $3 million on a pump station, arts, and miscellaneous items. The bond issue will provide $17 million in new funding. The City Council has enacted policies for the water utility by setting liquidity ratios and a coverage ratio. The liquidity ratio is a minimum 150 days of cash on hand, with 360 days of cash on hand. The coverage ratio is 1.50 times coverage which means for every dollar of debt, the City has indicated they want to have $1.50 of net revenue to pay the debt and offer a cushion. He reviewed a graph that illustrated rates per connection, highlighting the fluctuation in rates during the years that increases were implemented. An additional graph illustrated the days of cash on hand in the water utility from 2011 to 2016. Cash on hand has fluctuated between the liquidity ratio set by the Council and the goal of 360 days of cash on hand. Two additional graphs illustrated the coverage ratio and the cash balance summary including bond proceeds and unrestricted funds from 2011 to 2016. He reviewed a graph illustrating the City’s revenue summary from 2011 to 2026 including the following funding sources for water utility: gain on sale of assets, interest income, miscellaneous income, accounting charges, special district fees, and charges for services. The majority of revenues for the Water Utility Fund come from charges for services. An expenditure summary graph provided a breakdown of expenditures from 2011 to 2026, including total capital projects, total debt service, transfers, other operating expenses, charges for services, supplies, and personnel services. A final graph provided a fiscal summary for 2011 to 2026, comparing the total expenditures to revenues and the water utilities cash balance. Mr. Deeter discussed the Sanitary Sewer Fund and explained the Sanitary Sewer Fund and Storm Sewer Funds were previously combined, but were split and made independent of one another a few years ago. The final action associated with that division is the transfer of $3 million to the Storm Sewer Fund. Mr. Deeter noted the Central Weber Sewer District will be increasing fees soon and those increases are built into the numbers included in the Plan. There will also be CPI increases in the Sanitary Sewer Fund and no additional increases are recommended. $13 million total in sanitary sewer capital projects will be completed over the next 10 years. Refunding the 2008 and 2009 bonds will impact this fund as a portion of the projects included in those bonds were sanitary sewer project. The Council policies for the Sanitary Sewer Fund are slightly higher than those for the Water Utility Fund. Those policies are a liquidity ratio of 360 days of cash on hand minimum and a 2.0 times debt coverage ratio. He reviewed graphs for the Sanitary Sewer Fund that provided data specific to sanitary sewer. He also reviewed information for the Storm Sewer Fund, noting the Master Plan has been updated to take into account the condition of storm sewer infrastructure. CPI increases are built into the utility model for storm sewer and $82 million in capital projects are planned for the next 40 years with $8 million in the next 10 years. The fund will also receive a $3 million transfer from sanitary sewer. He noted the liquidity ratio and coverage ratio for storm sewer mirror those of sanitary sewer. 360 days of cash on hand and 2.0 times debt coverage. He reviewed graphs for the Storm Sewer Fund. He then discussed the refuse utility, noting that this utility was added to the annual review process this year. The fund will have no debt after 2016 and only CPI increases are recommended moving forward. He reviewed graphs for the Refuse Utility Fund and noted the data regarding the refuse utility will be updated once discussions regarding the Weber County Transfer Station are concluded and additional information is available to complete the rate study. FY2016-2020 Capital Improvement Plan 3rd Quarter Report Council Policy Analyst Symes noted the Council staff report regarding this item included questions about five Capital Improvement Plan (CIP) projects, but the first four were addressed in Mr. Lowder’s presentation regarding his department budget. He stated the only outstanding project is Kiesel parking between 24th and 25th Streets (CD097) and he asked that staff provide the Council with information regarding that project. Comptroller Stout provided the Council with an update regarding the Kiesel parking project. Demolition of the building that was formerly located on the project site has been completed and the project is in the design and development stage; this includes utility relocation. Council Business Council Norms Amendment: Council Communications Manager Mabey reviewed proposed amendments to the Council Norms regarding the stipend to be provided to Council members for electronic equipment. The Council indicated they are comfortable with the proposed amendments. Ms. Mabey noted the item will be on the June 14, 2016 Council Regular meeting agenda for formal action. Branding Project: Ms. Mabey stated the Branding Committee has been working on the project and most recently they developed a “Visit Ogden” brochure; she provided a copy of the brochure to each Council member. The document provides relevant information about Ogden and the branding initiative. She stated she is happy to provide multiple copies to each Council member so that they may distribute them throughout the community. The Council discussed the overall progress of the branding project. Council Calendar: Ms. Mabey briefly reviewed the Council calendar, with a focus on the number of budget meetings remaining before the Council will consider final action on the proposed tax increase and the City budget. The meeting adjourned at 6:11 p.m. ________________________________________ JULIA M. LASEURE, MMC DEPUTY CITY RECORDER ________________________________________ MARCIA L. WHITE, CHAIR APPROVED: August 9, 2016