[Music] [Music] [Music] [Music] okay [Music] [Music] me [Music] study session for the aurora city council for monday august 1st 2020 uh 2022 it's called the order uh would the clerk please call the world mayor kaufman mayor pro-tem bergen here council member coombs president councilmember gardner here councilmember jorinsky councilmember lawson here councilmember marcano president council member medina here councilmember mario president councilmember senberg here and council members of anik here there's a quorum there's no no mayor's uh updated are there any issue updates i was seeing none item 1c uh metro district update and discussion uh the uh brian matisse will have 15 minutes to be followed by christopher fellowes uh for another 15 minutes and then we'll have 30 minutes for questions and discussion uh mr matisse you are now recognized for 15 minutes thank you mayor kaufman is it possible there i can share my screen just a second please thank you mayor kaufman and counselors this topic the topic for the study session presentation was rather open-ended but i wanted to focus on recent independent research on metro districts and objective criteria that can assist council in approving responsible development using metro districts while also protecting aurora residents and taxpayers from excessive risk um i want to begin with a brief overview of my presentation uh first i want to point out that i personally believe that metro districts can be a useful infrastructure financing tool but not all proposed metro districts make economic sense and you city council are the first line of defense for the citizens and taxpayers from districts with excessive risk um city council has the duty under state law to scrutinize each district that is created to determine if there is a need for service in the district boundaries whether service can be economically provided and whether the district's tax base is sufficient to allow it to discharge the debt i want to go over a couple of presents you some metrics that i think you should consider first the debt limit per residential unit should approximate the cost of infrastructure which the home builders association estimates at thirty thousand to forty thousand dollars per residential unit second the debt to assessed value projection and final should be approximately thirty percent to fifty percent of the assessed value of the uh district when fully built out third districts need to have set boundaries so that both council as well as the taxpayers can determine uh what the risk is and and finally financial plans that allow for compounding of interest or high interest junior or or cash flow debt should be discouraged because they dramatically increase the homeowner risk the uh now metropolitan district financing makes sense if the cause the developed lot cost to home builders is less than it would be without a metro district now if a developer uses the metro district to pay for the infrastructure and then sells the lots to the builder at full market price there's no down payment savings to the home buyers and this is what's important here the home the developer is not necessarily the same as the home builder it's really the home builder that purchases the lots from the developer and it only makes sense if the home builder can purchase those lots at a savings in addition the interest rate on the metro district debt needs to be less than or comparable to mortgage interest rates it doesn't make sense to have a district charging to taxpayers eight percent interest if the if the home buyers could could have financed that at you know three and a half four and a half five percent mortgage rates and finally authorized debt that the council approves needs to be discharged in a reasonable time frame now the one of the important considerations is that the state legislature requires the city to disapprove a district service plan unless each of the following is presented and that's in crs 321-2032 the city must show that there is a need for service in the proposed district area that is not adequately served by existing government the proposed special district has to be able to provide economical and sufficient service and the area and this is important d is the most important the area to be included in the proposed special district must have or will have the financial ability to discharge the proposed indebtedness now if a district consists of a postage stamp which will never have any residents in it it can't possibly satisfy provision a because there will never be a need for service in a postage stamp district that doesn't have any residents similarly if you don't know what the area is going to be and the tax base of that proposed district on build out you can't determine whether or not it has the financial ability to satisfy its debt now even if all these criteria are satisfied the city may nonetheless disapprove the service plan if the city council in its discretion finds that the creation of the special district is not in the best interests of the area to be served now one of the important considerations in approving a metro district given the importance of affordable housing is whether the proposed metro district makes housing more affordable or less affordable the colorado association of home builders on their website recently estimated that the public infrastructure costs for a new development range from thirty thousand to forty thousand dollars per home now when approving a proposed metro district's debt structure city council should keep this number in mind a march 2021 study by anderson economics group showed that metro districts lower the down payment required by about 5 800 but over the long run they increase the overall housing costs by an average of sixteen thousand two hundred dollars per home that's because it results in much higher taxes over the duration of the debt and in addition the anderson economic group reports that for districts where homes are not sold as quickly as planned overall housing costs increase by an average of fifty thousand dollars per home i list the source here the anderson economic group this was a study in march of 2021 on metro district impacts on housing costs commissioned by the fort collins greely longmouth and loveland association of realtors the anderson economic group recommends careful scrutiny by county municipal governments such as a city of aurora to reduce the risks to homeowners now there are some indicators that the the city council should use in determining whether there's excessive risks one of which i've already mentioned which is if the infrastructure costs in the proposed service plan um substantially exceed 30 to fifty thousand dollars per lot for residential development um you know if that thirty to fifty thousand is probably reasonable a little buffer is okay to allow for inflation maybe fifty or sixty thousand per lot but recently this council has approved several service plans where the authorized debt per home that is projected to be developed is in the range of 300 000 to 1 million or more per home there's no excuse for imposing that kind of risk on home buyers when it is far more than the infrastructure cost to be developed similarly the authorized debt to assessed value ratio with final build out is critical under current state law unlimited mill levy general obligation debt must have a debt to assessed value ratio of less than 50 percent in order to be issued and less than 30 percent debt to assessed value ratio on complete build out is considered well capitalized so i would urge the city council to require that on final build out the districts should have a debt to assessed value ratio not more than the range of 30 to 50 percent finally council and the taxpayers need to know what property will be in what metro district's tax base this is particularly important when you have a multiple district service plan where there may be 10 or 12 different districts 10 or 12 different government entities you're creating at once you need to know which property is eventually going to be in which districts boundaries to determine whether the tax base is sufficient or not an inclusion or exclusion of a significant tax base from the service plan that's been approved should require a service plan amendment approved by council to protect the the taxpayers and the residents of aurora from possibly possible abuse uh finally i want to point out a couple of examples here of some risk in aurora debt that's already been approved that this is uh this is an estimated debt service payment structure in my materials that is from the south aurora regional improvement authority syria uh these are bonds that were issued in 2018 december of 2018. you'll notice that in this particular estimated debt service structure 10.45 million dollars of net project revenue was generated and the district incurred 11.25 million dollars of of debt service payments because there's about 800 thousand dollar cost of the underwriter the attorneys etc like that you'll notice that for the first 15 years from 2019 until 2034 the interest was not sufficient to pay the debt it was not sufficient projected to even amount to the interest payments and so the interest compounds and compounds and compounds for years until eventually in 2033 and 34 it reaches numbers like 1.7 million dollars of interest only per year compounding the ultimate cost over a 22-year period of that 10.45 million dollars of net project capital turns out to be 28.3 million dollars that's an excessive interest cost that is not economically practical and i submit that these kind of models are are setting the the districts up for failure they're setting the taxpayers up for an outrageous cost i also want to point out in your financial plan this is from the model service plan in aurora and i forget which district this is i just pulled one of the recent districts that have been recently approved and you'll notice that they have in the financial plan in the model service plan a maximum debt that that can be permitted it says here the total debt the district shall be each shall each each specific district shall be permitted to issue is four billion dollars now remember the number if it costs about forty thousand dollars of infrastructure per per home um four billion dollars would require something in the vicinity of a hundred thousand homes to be built for this district to make economic sense this is an excessive amount of debt that i think the city council needs to ask why are we approving uh you know four billion dollars of debt for a district where this is going to total perhaps millions of dollars or hundreds of thousands of dollars of debt per home also i want to point out that in order to have transparency and for the taxpayers the home buyers to know what's going on you have to have determinant you know a determined amount of debt this is an example of one of the forms filed with the colorado department of local affairs for an aurora metropolitan district and you'll notice that when this debt was issued it was indeterminate amount it was a tech it was an advanced reimbursement agreement with pledge revenues and it's impossible to know how much debt is ultimately going to be borrowed because the document filed with the department of local affairs provided for not applicable unknown principal amount of debt an unknown interest rate an unknown rating of the debt and an unknown final maturity date how can a taxpayer know what they are purchasing if you allow districts to have indeterminate amount of debt such as this district finally in your packet there is an excellent article an excellent white paper that was prepared in december of 2016 by the colorado future center a 501 c 3 non-profit uh nonpartisan institution affiliated with colorado state university on metro districts this uh this this nonpartisan agency concluded that some of the metro district structures that were being used were not in the best interest of the residents or business owners and effectively served not just to pay for infrastructure costs but instead to maximize developer profits while shifting the risk of development to taxpayers at page 11 in your in the packet it indicates clearly creative amendments to colorado's laws have led to novel approaches for not only minimizing risk to developers and maximizing their return on investment but also keeping control of future government decisions affecting their operations future residents and property owners cannot become obstacles while development plans are implemented by allowing the development company to maintain control of the government undertaking and it goes on and this is where your role is as city council county and municipal governing boards as well as district courts have allowed this practice which appears to only benefit development interests potentially at the expense of the ultimate consumer whether a resident or a business owner thank you mayor and council that concludes my presentation i urge council to responsively approve metro districts while at the same time protecting taxpayers through some of these metrics here thank you uh mr fellow you mean you were recognized for 15 minutes thank you mayor i'm going to try and i'm going to try and exceed my technological abilities and boot up my presentation here mayor and council i hope you can see my presentation and without cheryl's help i couldn't have gotten that done um thanks for the chance to speak this evening and uh this is a subject i enjoy chatting about i've been involved in the land development business in the front range of denver this is my 38th year i've been involved with special district matters since 1986 and i'll go through my presentation i think pretty quickly because a lot of the issues i have to say i think i think council's already familiar with and i think mr matisse already hit on some of the positive points i think districts are very important i think they can lower that cost of housing i think they can increase the quality of amenities and improvements in a community i think they can help finance regional improvements and regional projects which are otherwise not financiable i think they can help finance projects that need financing or maintenance over a long period of time metro districts have been in colorado since the late 1800s right now there's depending on whose source you want to find there about 1800 active districts in colorado total total current debt of districts is again depending on who you want to believe about about 12.3 billion dollars in debt currently financed with metro districts about 2500 bond transactions the top 20 selling residential communities in the front range all utilize some form of metro district financing i think this is indicative of the the size and the magnitude and the uh some of the commonality of where we'll find districts there's been about 10.98 billion dollars of districts uh financing done in the last 10 years the default rate i think this is a particularly important one to talk to the default rate on special district debt is less than one percent i think if you go and examine that even more clearly you'll find that the default rate where a lender actually ever lost money is uh in the hundredths of one percent range it's an incredibly efficient incredibly safe way to finance things i have a little experience in that matter i think in a about a five-year period of my career i was involved in the restructuring and workout of about 177 million dollars in defaulted districts and i'm very familiar with and very sympathetic to things that have gone wrong in districts who got hurt how they got hurt why they got hurt what's been done to fix that uh i certainly am a proponent of measures that can be taken to protect homeowners and measures that can be taken to protect lenders although i think that the laws that were passed in the in the mid 1990s brought a great deal of change to risk in district financing mr matisse talked about limited tax or unlimited tax general obligation bonds there's a radical difference between the two in my opinion be happy to talk about that if there are any questions on that over the last 15 years the average borrowing rate for district debt is about a 4.97 percent rate very effective interest rate very cost effective way to obtain funds to build public infrastructure and so i just give you some examples here of things that i think everybody on council is familiar with and things that i've been involved with just in the last few years that have a regional benefit or will have regional benefit and yet probably would not occur without special district finance aerotropolis parkway the 38th and e-470 interchange the 48th and e-470 interchange the powhatan i-70 interchange i think it used to be called the harvest road interchange regional lift station recently sanitary sewer lift station recently built by j.a greene the new 64th avenue project that's being built from e-470 to jackson gap that you've probably all seen and i think that's going to open in the next week or two which will be a huge regional benefit so i think there are a lot of regional benefits with districts that come with the ability to finance things in a positive and cost-effective manner with lower borrowing costs we can develop lots for less we can because we can develop lots for less some of that can result in more competitive prices for watts some of it can involve more enhanced amenities in a community another thing i think it's important to remember when talking about some of these finance matters and when i when i get uh excitable a lot of times is when people are proposing uh impact fees which i think for most purposes are very poor tools for financing infrastructure because they impose a cost day one without any kind of amortization period a lot of the infrastructure we're dealing with could be can be and should be amortized over a 20 30 year period of time because they have longer benefits than even that and keep in mind the average length of time for home ownership in colorado is seven to nine years it's not 30 years it's not 40 years it's not 50 years i think that's an important factor in framing the discussion and framing uh how you look at financing so really nice to have a tool where the homeowner moves in day one isn't paying 100 of the cost of all the infrastructure used to develop that community day one that can be amortized long beyond when they're going to live there and move um we're all familiar with upkeep maintenance uh all kinds of reasons that a semi-perpetual entity can be very beneficial a lot of times we enter into ijs with the city and having any that be around for longer than the developer is a huge advantage over the last since 2008 for sure it has been radically simpler and more feasible to raise capital for public infrastructure using metro districts than a local developer would be able to do in fact a lot of those capital markets for financing infrastructure were totally unavailable out of play for about eight nine years following 2008 costs for metro districts as we talked about it you get to amortize the costs over 30 years you get to have a lower interest rate so just give you a little uh a little a quick little schedule this is just a comparison at wimler which you're all familiar with uh and you're familiar with my involvement just on the metro district debt that was financed at windler if you look at what it would take to borrow that same amount of money at a from a private source if you could find it which you probably couldn't but if you could you'd be paying at at least a 12 interest rate you'd probably have to amortize those costs over five years instead of 30. so this this little table it's you know this is just a little stab in the dark but it gives you an idea of the kind of difference in cost between what's available with special district financing and what would otherwise uh what the hurdle rates would have to be overcome by a developer without the metro district financing it's a gigantic difference so uh here's another example uh mr matisse mentioned that the only reason that you should do a district is it reduces the cost of the home and i would argue that that is a positive use of metro district finance but another uh positive use of metro district finance would be as you see it painted prairie that you're all familiar with [Music] it didn't necessarily reduce the cost of the lot to the builder because the developer is trying to maximize profit the developer is trying to get the best price they can for the lots but at painted prairie at our high prairie park which many of you are familiar with because we had metro district financing we were able to put 12 and a half million dollars of improvements into high prairie park which will be enjoyed by the residents of that community into the future 30 50 100 years maybe 200 years and and those are direct tangible benefits to the residents those are tangible benefits to aurora and the community wouldn't have happened without special district financing similarly as you're starting to see the submittals coming in from our windler group you will see that our discovery park in 1881 park we're estimating that there's going to be about 90 million dollars in investment in those improvements if we just built the aurora minimum standard which is what would probably have to happen without metro district financing there'd be more like 25 million invested that extra lift that extra 65 million that is going to create a better community better bones better fabric better structure we believe a better long-term piece of fabric to the city of aurora and its residents certainly the homeowners in those communities [Music] we we think that residents in metro districts when they're properly handled properly structured properly done uh and i use the pr word properly there all the way along because mr matisse and i would probably agree on many things and many examples where developers may not have handled things the way it would have been ideal right i as i mentioned i have a very very deep extensive background in doing defaulted district uh workouts and i've been in the rooms with bondholders who thought they were going to lose their life savings and literally little old ladies who were single who had invested their life savings in metro district bonds that were then in default i've been in those rooms i've been in the rooms with homeowners that were subject to unlimited mill levy uh geo debt and they thought they were going to lose their homes in their way of life both instances are horrible things both instances i spent years of my life working on to help work out and help protect those people and i feel very strongly that it's important to put proper safeguards in place metro districts can pay for enhanced amenities safety protections transportation services a lot of things that may not be paid for or may not be financed and operated as well without a district i think metro districts help growth to pay its own way i think they build a great way to share regional infrastructure cooperate on regional infrastructure improve the bones and fabric of the city as cities become cities and counties become more and more challenged and more constrained with their budgets i think that the uh metro district finance allows opportunities to finance things that are needed but would otherwise not be available some positives which also can be a negative and certainly there can be and have been abuses of these things but when properly handled metro districts are a micro level of governance which i would argue in most instances is a positive thing when homeowners get to take over and control their own districts they get to have some self-determination which i would argue is a good thing and a thing that should happen the taxes to the homeowners when using micro and local government don't extend beyond the limits of what the governing municipality approved and i think residents in metro districts again those being properly run have a better chance of their voice being heard than they do with a larger more remote form of government and all muscle districts have structures where the homeowner should eventually be in control of the district now i will say that i've seen instances where developers or special district attorneys have intentionally designed structures to prolong the amount of time and and and lengthen the amount of time it takes before homeowners get to be involved in controlling their own destinies in their own districts i'm not a fan of that i've actually spoken publicly against that for over 20 years i wrote the special district and service plan policy for weld county and we wrote provisions in to prevent those kind of structures not all of my co-developer friends were excited about that i got a lot of heat for doing that but i believe there should be self-determination and the homeowners uh in the in the early years should have control turned over to them at the right points in time for self-determination metro district meetings require public notice they require the opportunity for the electors of the district to participate i think that there have been statutory measures taken to improve those openness and transparency issues i'm not so sure that more measures couldn't be done that wouldn't be helpful but and i'm a gigantic fan of discussions and to discuss what can we do to improve transparency and make them more available and more open to the electors in the district just getting near the end here sorry for the length of my squawking just some examples of some great communities highlands ranch central park painted prairie that's a self-serving comment to say great community the meadows and castle rock all places where metro districts and special district finance have contributed to the uh quality of amenities and the quality of life and uh with uh without metro districts i think you would find that there would be a great constriction in the uh the creation of supply of uh finished residential lots i think that would further exacerbate the supply demand problem and as we all know for microeconomics if you restrict the supply without changing the demand curve prices go up we already have a price problem so i think districts are really an important tool to help deal with the supply of finished lots which are then available to home builders to increase the supply of housing and like i mentioned there are infrastructures where a city or county is either unwilling or unable to finance improvements that are needed and districts often step in and do that when i was getting my master's degree at uh cu denver mr fellows i'm sorry your time has expired thank you uh of questions uh from council uh to the presenters mayor uh memphis yeah thank you um if if i might ask each one um a question so for um mr matisse thank you for the presentation i think it is important that you know residents understand metro districts and um i think part of that is education and and certainly um you know understanding what they're getting into in terms of um long-term debt um so you mentioned it i have to say i was one of two i think on this council because some people are new so they weren't here when we voted on the excessive debt that you mentioned um and so two of us did not we voted no on that but um when you mentioned that i i agree i mean i think there is a point where you know we have to be responsible in making sure that we're approving the right amount of debt to build out the infrastructure and all the amenities and so forth um but but we we need to be careful on that you mentioned um time of build out i think for homes that are not sold as fast as anticipated and um can you go into that a little bit in terms of what that you you mentioned what that does to the current homeowner um because obviously as as more homes are built faster then the debt is reduced yeah yes uh mayor pro-tem bergen the uh in general um when metro districts are created there often are advanced reimbursement agreements between the developer and the district and it usually provides that at an appropriate time the the the the debt will be converted to bonds unfortunately what often happens is especially during the the 2008 910 great recession and perhaps we're entering another period like that often development is placed on hold for a long period of time and what happens sometimes is the the developer continues to collect interest on their advanced reimbursement agreements sometimes for many many years i can think of a few examples like inspiration the former rockinghorse the developer debt just kept accruing because they weren't building anything for for the better part of 10 years and uh and what that does is it shifts the burden from the developers that no longer have that risk they're now earning interest at eight or nine percent to the homeowners and the homeowners um have to have difficulty affording it because the interest rate on that is so great we have an example i mean one of the other districts i'm familiar with murphy creek murphy creek you know that's a development's been going on for 24 years and it still hasn't built out after the you know 1998 1999 and it and and they haven't been able to pay one dime of their principal all these years and as a result the debt just keeps accruing and accruing accruing and they wind up spending far more than is necessary so so that's the problem that you have there it obviously the financial plan needs to be reasonable and not overly optimistic and that's the job of city council to scrutinize whether or not the financial plan is reasonable and and whether the absorption rate is practical so in terms of a recommendation to us because i mean we we obviously approve the service plans but we're not we're not going to be um you know watching all their financing um as they go through so what would your suggestion be in that situation to prevent that well my recommendation first of all would be that um you should not approve service plans where the risk is shifted to a developer like that in other words interest should not be accruing on developer capital that is going for the purpose of of risk it should go for infrastructure when and if it is it is developed it should not be interested in the crew on these developer advances uh during a time of of poor market conditions okay thank you and mayor may i ask a question to chris fellow um hi chris um and thank you for your presentation um you know i i certainly understand the need for the metro districts in terms of providing housing and and i live in a metro district and um get to enjoy a lot of the amenities um that you know are afforded here um can you speak on the on the um operational no levies versus the debt no levies because i think there's confusion with homeowners on that and and one one gets paid down but the operating operating you know levy obviously continues and sometimes those are refinanced well so good question francoise and yes i think there is a lot of confusion on that issue and i think it would be great to talk about what can we do to help clarify that for homeowners because i'm a huge believer we need to do everything we can to help homeowners understand what they are or not getting into so we really have two components of our overall mill levy we have the debt service mill levy and we have the operations and maintenance mill levy so i'll just break it down real quickly and do an anecdotal answer at painted prairie uh that park that we were talking about that beautiful park high prairie park that 12 and a half million dollars that went into building the park that came out of bond funds which will be replayed repaid through the debt service mill levy but then ongoing um long term 10 20 30 50 80 100 years that park will need to be maintained and that the maintenance for the park comes out of the operations and maintenance mill levy of the district and that's a that's one that we try and estimate and we try and get right and we try and set in a range that will take care of a community at the right level but it's also one where 15 or 20 years from now when i'm you know long gone from painted prairie the residents of the community who will be in charge of their districts they may look at it and say hey we want an enhanced level of maintenance and they might increase the lm mill levy to enhance the level of maintenance at the park or they may say you know we'd rather have a little less level of maintenance and pay a little lower o milani so that that o m mill levy is able to be adjusted up and down and it's not a hard pledge towards a bond issue like the debt service military usually is and the and the o m if it is to be increased would have to go before the vote the voters in that district no they it's it's very likely that there's been some flexibility already built in through the the debt and tabor elections that occur and then it would be up to the board of directors of the district which by then should be in the control of the homeowners and they're collecting their own board and the board is made up of the homeowners they get to have that self-determination of the mill levy so that should be something that they're able to adjust up and down but they don't have to they set it up right at the beginning they don't have to go back and revoke to have that on the levy work properly thank you so much recognize myself to ask both of you a question and that is uh what in your view aurora has a uniform a service plan agreement this time what in your view has been the impact of that if any uh chris uh yes mayor kaufman i would say one impact is it's made it very easy for developers and applicants and those trying to create a district in aurora it's made it very easy for them to know what the rules are going to be and what the expectations are and it made it very simple to write a service plan because i think every special district lawyer in the front range knows what aurora's rules are what their expectations are what ought to be in the document so i think it's been a a very very efficient document and process with a lot of transparency as to what's expected in aurora thank you mr batista i have to respectfully disagree i i think the the model service plan was a good idea when it was originally created but unfortunately it has uh devolved into something that is basically a rubber stamp in other words if the if if you dot the i's across the t's fill in the model service plan and you don't even include a detailed financial plan you don't even include a detailed infrastructure plan it gets approved by council because they say well hey the model service plan approved it toge crossing which i i've been on the board of directors of for the past uh uh 16 years uh we were before the model service plan we were in uh organized in the early 2000s 2001 2002 and our service plan which was the service plan that was used before the model service plan it actually had attachments to it that included the projected debt schedule when the debt is going to be issued it had um the infrastructure that was going to be developed and it specifically identified what the mill levees were planned to be over the course of a period of time it worked very well for us and and we have been able to live within our means and we've actually been able to pay down that debt and now shift some of the mill levy to operations what what is happening now is you're getting a lump sum number when you create 5 or 10 or 20 districts all at once a lump sum number of 4 billion dollars without any regard to what the infrastructure is actually going to cost without any regard to whether or not the debt is going to be able to be financed by any one particular district without even knowing what the tax base is going to be for example pay and prairie when you approve the first nine districts they were all uninhabitable a parcels within the highline canal flood plain and and it was to be determined later what properties with which tax base would be included in what district so you basically were buying a pig and a poke and not knowing uh whether or not it could be affordable so i think the model service plan has led to complacency and rubber stamping by city council without careful regard to the metrics that i cite such as what is the debt to assessed value ratio going to be what is the amount of infrastructure that's going to be financed and is the debt limit appropriate mr fellows you have a response uh i do it's a very detailed one i didn't know we were going to have a debate tonight but i'm happy to entertain it i i think many of mr matisse's comments are completely unfounded uh his his first comment on what he disagreed with i think he and i agree uh if if you looked at the weld county service plan that i drafted i i think it's appropriate to include a finance plan and a infrastructure plan with a service plan i think that's appropriate what a authorized debt number is and what the elected debt questions are and what the debt capacity of the district are are all very different things using painted prairie which is not in the floodplain by the way that wasn't true but um using painted prairie as an example with a master plan community with many moving parts that's likely going to live through a couple of market cycles very very well it's impossible to know exactly what your infrastructure is going to cost when it's going to be needed where it's going to be needed how growth is going to occur one example is during the life of painted prairie we all originally believed that the commercial district painted prairie would be down on 56th avenue down on our southeast corner then a little thing happened called the gaylord hotel which was unknown when we were forming our districts and that changed the focus of where the economic center was that commercial properly should be developed up near the gaylord into the town center which is you know we're all working on if you had pre-established in the whole area exactly where all the districts were you would have had your military set up you would have had your boundaries your district set up by allowing flexibility to how the district boundaries correspond to growth and the type of growth i think you can design a much better much safer much more appropriate finance plan for the the development of the property and for the taxpayers in the property council member combs do you have any questions thank you mayor um i apologize i just had to get unmuted um so i have a few questions i'm following on on that most recent point um i guess my question would be isn't that the purpose of service plane amendments is that there is change that occurs and at that time surely a council would say oh this makes sense we do want you to build up near gaylord for this commercial district and not down on 56 and that it's appropriate for the body that has oversight to be assessing those types of decisions to ensure that they are good decisions because you could have with that flexibility just as easily developed in an inappropriate location and moved things um from where they were originally proposed is that a question to me council member coons yes my answer would be i think some of that depends on the level of detail and control that the city wants for example business improvement districts uh the the directors of those districts and the annual operating plans have to come back before the the the city for review on those things i think in the case of painted prairie i could show you why or in the case of windler i could show you why knowing that all the property would have to be in a district and knowing that all the property would have to be in a district that's taxing either 35 mills for debt service or 50 mls for debt service allowed us to have a very flexible financing plan that allowed us to go to market and get debt um we're we're very thankful we were able to go get that last august at four and a quarter percent because if we did it today would probably be impossible or would it be probably eight and a half or nine percent but i think there are some of those decisions that don't need to come back to council and i think some of those decisions with uh local uh thought and input and design and planning are more properly handled by the people right in the middle of that grind and fight but it's not to say that you couldn't do it the other way and i've been involved in projects where you put all of the property in the project into one of the districts at the beginning and you can't you can't change boundaries without the consent of the organizing municipality and i've done those deals and i would tell you i don't think you can find evidence or proof that one is better or worse necessarily than the other both can be done viably you know we have the situation at windler where we're not sure which properties for sure are going to go residentially and they may go because we're in a mixed-use zoning and they may go commercially if they go commercially the debt service mill levy needs to be you know at the 35 mil range if they go residentially it needs to be at the 50 and that's going to get determined a little by the marketplace that issue if if council were determining all those things in advance that might have to come back to council 10 or 15 times over the next 15 or 20 years i'm not sure that can't be done i'm also not sure it's better further questions though thank you yes um mr matisse do you want to give any commentary on that particular issue yeah yeah yes i do uh remember combs um if the if the city council does not know when it approves a service plan what area is going to be included in the um tax base of each district at the time it approves the service plan how can it possibly answer the fourth question that's required to by statute which is that the area to be included in the proposed special district that's singular that means each district has or will have the financial ability to discharge the proposed indebtedness it has to know that i i certainly would agree that minor inclusions or exclusions is not a problem like up to five or ten percent of the ultimate tax base but if you're dramatically changing the tax base and i've known at least one district where right on the eve of homeowners taking control of the board because the election was coming up in may the the developers of the district shifted 90 percent of the tax base into a different district that they controlled just so that the homeowners would have no control over it and it resulted in these homeowners 40 some watts having to pay indebtedness that was originally contemplated for 300 and some homes that that's the kind of problems that happen unless city council requires that they have to just come back to city council for approval of amendments to service plans which as you know happens all the time yeah thank you um and thank you both so then i have another question that i'll start with mr matisse just if the source that you cited has any information on what percentage of districts have needed to increase mill levees above the initial approver approval debt service mid-levees to avoid default and whether or not shorter home ownership periods mean that second and third owners of homes are paying more than original owners in uh like higher mill levies than original owners uh uh remember coombs i believe you're referring to the anderson economic group report is that correct yes correct um i did not see that level of detail in terms of which ones had to increase increase their their their mill levees i do know that that typically there is a financial plan um unfortunately the role model service plan does require a detailed financial plan that identifies the the contemplated year by year mill levy and and usually they try to make it so that when it's fully built out the the mill levy drops from and this is another problem you know the the the gallagherized mill levy now that that sounds like a 50 mil cap in aurora is really like about a 59 mil cap now and it's going to go up next year when the gallagher ratio which the former gallagher ratio goes down again um that 60 mil cap or close to 60 mil cap eventually they try to make it so that it at full build out it's down to about 30 or 35 mils what happens instead is that the cap stays at that high level or even goes up when there's a reduction in the residential assessment rate and so as a result they wind up paying far more than was contemplated so i think that's what the change is now the risk is the risk is that the the service plan the model service plan now contemplates that at some time the the mill levy shifts from a limited mill levy cap to a unlimited mill levy cap when the debt to assessed value ratio drops to 50 percent that has the possibility in later years you know 20 to 30 years out of the mill levy now becoming unlimited which potentially could result in the homeowners having to pay much higher than the 60 mil rate so i don't know if that answers your question the bottom line is is that particular study the anderson study i did not see in at least executive summary the specific amounts but but that is my understanding as to what they were saying they were comparing the original service plan analysis and schedule of of of mill levees which which was the basis of the approval to what actually took place based on the real world build out okay thank you and mr fellows do you have any additional commentary on that issue on both um the need to increase debt service mill levies or how debt service mill levies may increase the amount that folks pay and then also since you mentioned the short time of home ownership does that short time of home ownership lead to second and third owners ending up having to pay higher rates not just based on the appreciation of property but based on metro service debt thank you um yeah my first comment is mr matisse is incredibly articulate well spoken it's fun to listen to him speak the second is i think he and i agree on many things uh one one thing i disagree on is some of his assertions about the debt or a debt authorization and effect on what homeowners pay and i want to get into that the direct answer your question councilmember coombs is there should be mathematically no difference and no greater effect to the let's say that we had a 25-year debt instrument that paid on schedule and on time there is no shift of burden from the and let's say homeowners changed every five years there is no mathematical shift of burden between the homeowner that lives there in the first five years the one that lives in the in the second third fourth or fifth there is none uh the second thing is so long as we have a limited tax geo mill levy so let's just say for fun without gallagher adjustments i'm pretty sure we changed how that gets redistributed last year in the state of colorado so we're no longer going to have the kind of gallagher adjustments that we used to but so long as that's flat let's just assume for the sake of debate without a few more levies whether the debt in the district is 10 million dollars 50 million or 100 million dollars your payment is going to be your debt service mill levy times the appraised value the assessed value of your home the amount of debt is not going to affect your payment zero none now uh one thing that i'm going to say right now going to make a lot of my developer friends angry and it's going to make a lot of the underwriters really really angry um when when the laws were changed in the mid 90s and we started working on this limited tax general obligation uh type of bond issue i argued then and i've argued in several of the 614 million dollars in bond issue debt that i've been involved with many of those we have kept the limited tax structure in the document and there is no what's in our industry known as the burnoff provision where when you get to a certain level of debt to assess the the the limiting factor on the go burns off i've argued publicly i've done in a lot of my districts i don't like that public policy i don't like that that shifts the risk from the bond buyer which in most cases now are institutional bond buyers which is good because they're way more sophisticated right they're not uh retired people with with fixed incomes it shifts the risk from the bondholder back to the homeowner and you you end up in situations like i worked on at castle plains north where people thought they were going to lose their homes there was going to be a spiraling mill levy that was going to foreclose people out of their homes that was horrible i would argue and i think mr matisse was would probably he and i would probably be able to agree on this i'd be i'd be a huge fan of saying to having aurora say in their model service plans we we don't allow the burnout provision irrespective of your debt to assess because that can change too we're going to have limited tax abilities or we're going to limit them to the the maximum number allowed right or that what that plus or minus 50 ml levy that's plenty we can finance infrastructure debt with that today people are buying those bonds today why do we need that burn off provision so i just i just made a bunch of my fellow developers and a bunch of underwriters unhappy but i think mr matisse and i would both agree there are some protections like that uh and he probably come up with a more intelligent a better way to describe it but i if there are methods like that that we can protect future homeowners i'm a huge fan i've been in the room with people that were losing their way of life and it's horrible i don't know why we even allow the burnoff provision okay thank you that's super helpful um mayor can i ask one more so the other question you mentioned mr fellows the funding of regional improvements and i guess my question for both of you it's more of a philosophical question should it be the case that metro districts that are paid by discrete groups of homeowners within that district are funding the regional improvements or should we as a government be able to find ways to fund those improvements that gets distributed distributed across all of the users of those improvements mr matisse you want to go first or you want me to go first your your call i'll be fine going first doesn't matter um councilmember coombs um i think that there's a real risk the city has when it uh created that a regional uh the regional improvement authorities um it's not clear to me that that's constitutional if you look at the the case law it was one of my cases landmark towers homeowners association versus marin metro district uh they base the the the courts basically held and it dates back to a 1900 or early 1900s supreme us supreme court case said that these kinds of special improvement districts like metro districts are not supposed to fund improvements that benefit people outside the district that they can't benefit from um and and so in this particular case uh one of the examples of a failed bond the uh the marin metro district that was a a new subdivision that was being built south of the landmark towers and the improvements were for that subdivision it was declared that the tax levy was unconstitutional a violation of due process and they struck it down and colorado bound shares uh bond buyers wind up eating a lot of many millions of dollars on that so so that's a real problem i think there's a serious concern as to whether it's constitutional or not second of all i think regional improvements uh funding regional improvements that are outside the boundaries of the metro district causes a problem because what it does is it it encourages the city to perhaps over develop when it doesn't have the ability one of the problems the city has had for example is is paying for the cost of road maintenance you know these these regional improvements are are built uh based on the ari authorities and then they turn these over the city to maintain and the city doesn't didn't have the tax base to put them in the first place or didn't have the desire to put these these improvements in the first place but now once they're turned over the city has to maintain it and that's one of the reasons i think why uh infrastructure costs uh you know maintenance and road maintenance costs are going up so much so i think it's a i think it's it's not a good idea uh creating these uh because it tends to lead to over development of infrastructure so my my answer back would be um mr matisse just threw the entire baby out with the bathwater i think bad facts make bad law bad behavior and bad actors make for bad facts there are certainly individual cases where there have been abuses i think there are also many cases where there have been huge successes that benefit us so i think you can't throw the baby out with the bathwater clearly landmark was a situation where there were horrible acts and horrible behaviors and and things had to be corrected but i'll give you a couple quick examples council member coombs at um at windler there is a needed interchange that's been on all the all the plans of the city and neetz and cdot and dr cog for years at 48th and 470 we're in a period where distribution logistics growth is at a real peak that interchange is needed now the windler public improvement authority is going to enter into an agreement with e-470 authority and adams county and maybe others to help fund that interchange so a portion of the funding of that interchange will be paid for by future taxpayers within the boundaries of the windler public improvement authority and it will confer a benefit upon all of those taxpayers and that area and it will allow regional commercial growth to occur which will more than offset costs and taxes paid by the residential homeowners in windler and it'll be a great benefit on them another example would be if you looked at porteos which you're all familiar with a very successful commercial development in the city the porteo's development paid for jackson gap in order to get the project going well jackson gap street goes from 56th all the way into the into dia and thousands and thousands and thousands of cars use that access and don't pay for it uh the city didn't contribute to it um the the velocity metropolitan district had to pay for a hundred percent of that um should there be a regional component to it probably but the reality of those complexities would be mathematically unmanageable so uh it's another example though of great infrastructure that benefits porteos and benefits the region and the city and dia alike and wouldn't have been possible without metro district financing me the the time uh uh the one hour allotted is uh expired however i'm going to extend for uh 10 minutes to see if other members have a question you haven't asked the question yes mayor i'm sorry mayor councilmember connor mcconnell thank you sir uh i want to thank you both christopher and brian for your presentations and your spirited debate thus far i have a question uh for brian here and that is um do you see a means for us to amend our model service plan uh to have a formula to cap the amount of debt that can be issued um to the number of homes kind of as you were mentioning earlier um you know between that 30 to 60 maybe if you wanted to be very generous then you know estimate worst case scenario with inflation for each district and is there an example of a service plan elsewhere in the state um that has a similar provision thank you council member mcconnell um i believe um i'm a little reluctant to say that there should be an absolute formula cap in the service plan and that's because i believe it's the responsibility of of city council to make that determination as to whether or not the debt can be can be discharged so i would prefer that in in the model service plan there be perhaps a line item where the developer is required to indicate the anticipated amount of infrastructure costs the anticipated ratio and then to allow city council to make that determination hopefully staff will comment on whether or not the target ratio uh is satisfied or not um i'm i i do know that there are some um municipalities that are looking into or have looked into this my understanding i know that the city of colorado springs right now is they're just about completing their process of of revising um their standards for approval and i i haven't seen yet the actual cap or the ratio that they use but i do know that they have a little more stringent uh ratios and and uh and limits than aurora has i believe loveland also uh their city does require um more stringent approvals of that and i believe that actually i haven't looked at it yet there's a new um there's a new um policy that was recently approved by oh i want to say i'm drawing a blank right now one of the cities right outside of boulder um i'm drawing a blank right now but in superior you know it's oh it's a different one but anyway um but they are they are also um uh tightening uh the requirements especially with regard to some of those ratios okay thank you mayor i have a couple more if you don't mind well um please proceed but i um time is short thank you uh so you mentioned earlier these uh small uninhabitable districts which were demonstrated in our backup you are correct it does appear that those were um pretty much following the highline canal path there are those still permissible under law and if so what would you recommend we do are you addressing that that to me yes what kind of oh yeah and i apologize it might not have been the floodplain but it does look like it was i mean my understanding was these were these were small individual parcels in somewhere along the highline canal that we're not going to be developed it is still allowed it is it is still well it is let me just clarify it is it is commonly done under the aurora uh multi-district service plan um that the state you know once again this has not been litigated but but the uh the state has never clearly defined if someone challenges this practice um you know whether or not it is lawful or not um so i belie but i believe that it's it's basically a a danger that that that you have when you allow this because once again you don't know what uh what properties are going to be in which district and what the ultimate tax base is going to be now there was a second part of that question i believe that i missed that one yes and that's what would you recommend uh we do as a solution right and the the solution i think is is that each district when you create multiple district service plans each district needs to have a well-defined tax base at final development so for example in the case of a district that's going to have nine or ten different neighborhoods each of those should have its own geographic boundaries with its own projected tax base and build out if there's a significant change through inclusion or exclusion such as mr fellow suggests might be needed because of development changes like the gaylord going in then you need to come back to the city council for a material modification i would suggest if the tax base is going to be more than 10 percent higher or lower all right thank you sir are there any members who have not uh asked a question who wish to uh seeing none uh thank you both very much i appreciate it um uh consent calendar item number two a through 2c are there any objections to moving out of number 2a through 2c forward saying none item number 2a through 2c will move forward i'm number 3a resolution to transfer a certificate of designation for biomedical waste treatment karen hancock good evening mayor kaufman and city council my name is karen hancock and i am a planner in the planning and development services department i have a very brief presentation and no slides the state regulates waste treatment land uses and requires local jurisdictions to issue a certificate of designation for waste treatment land uses aurora has exactly one waste treatment land use and that is a business that treats biomedical waste using ozone the treatment takes place inside of an enclosed machine and the machine is located inside of a building the byproducts of waste treatment using ozone are water and oxygen the business is located directly across the street from the ice facility near peoria and smith road and near the fitzsimmons and shoots medical campus this is the only biomedical waste treatment process using ozone in the state of colorado in 2014 the city issued the certificate of designation to the business owner colorado medical waste the owner of the biomedical waste treatment business wants to sell the business to trilogy med waste the new owner cannot operate the waste treatment process without the city transferring the certificate of designation excuse me to the new owner in 2014 council issued the certificate of designation via resolution before you this evening is a new resolution to transfer the certificate of designation from colorado colorado medical waste to the new owners trilogy med waste headquartered in houston texas the new owners will operate the business and the biomedical waste treatment process in essentially the same manner as the former owners the colorado department of public health and the environment reviewed the engineering and environmental plans on the city's behalf and included in your agenda backup is a letter from cdphe recommending that the city approve transfer of the certificate of designation to the new owners cdphe opened a 30-day public comment period for the public to review the engineering and environmental plans no public comments were received the business has had no code enforcement actions and has operated in accordance with their permits since 2014. the business may not operate and generate revenue until the resolution transferring their certificate of designation is approved by city council city attorney's office staff has determined that a public hearing must be held when the resolution is presented at a regular meeting of the city council please note that the requirement to transfer the certificate of designation is solely a state requirement and not required by city zoning regulations all city zoning regulations were met back in 2012 2013 before the initial development application was approved the question before you this evening is do you wish to forward this draft resolution to a regular meeting of the city council for a public hearing please note that staff has tentatively added this item to the august 8th meeting to streamline city council review timeline for this business customer that concludes my presentation and i'm happy to take any questions questions for staff a thing known as rooney objection to movie i've never three day forward uh seeing that item number three will move forward thank you karen uh item number five a rules of order procedure amendment consent calendar uh council member gardner thank you mayor um i do know that this um uh proposed rule change uh was debated at a study session um about a month ago um and since that time there was one uh change added but before i get into that i just kind of want to give a brief summary of of the why behind this so as as most of us know as aurora has grown our agendas have gotten much more complex however the vast majority of items um after having being presented upon in policy committee after receiving a debate um and conversation at a study session still come to council for um a formal presentation by staff as well as um a vote by council and the vast majority of those items um it's a you know frankly a token presentation by staff and and that's certainly not a criticism of staff it's just at that point it's been presented and debated and um and then those items many times receive a ten to nothing vote and we move on at that by that point however there's been plenty of opportunity for council members to weigh in and so to me this really does a couple of things one it will streamline our agendas and ensure that items that need to further debate that have a big public interest will receive um more time allotted to them and will also be done at a more reasonable hour you know many of you know we've had council meetings until one two or three in the morning for more controversial items and there are times where we are being presented with contracts in the tens of millions of dollars at one o'clock in the morning and um you know it's it's appropriate i think for those two um to be done differently and i think it also respects our staff a little bit more this will give them a lot more certainty when they have to present an item while also maintaining the ability for any council member at any time to pull an item to have a formal presentation at a council meeting also it will maintain the ability for any item that has a public comment to be pulled for a presentation and a vote i think what happened at our council meeting last week is a good demonstration of how this would work there were two consent agenda items that had a public comment both of those items were pulled off we heard the public comment there was an opportunity for council questions as well as council debate and then a formal vote was taken on that individual item and so i think that really demonstrates how uh this would work i will note however um there are uh the the one i there are a couple of items i should say um that will not be allowed um to be put on a consent calendar and those two items are public hearings and annexations uh those will still require um an agenda item and so you'll kind of see if you look on i think this is page 104 of your packet it lists the items that would be allowed under a consent calendar and then the rest of our our order of business the one change i do want to note because i know this came up at study session last time and wanted to make sure that there was a process in place so council members if they want to call an item up whether that's for discussion they want an individual vote so they can vote no whatever the case may be need to notify the city clerk by 1 pm on the day of the council meeting however that does not impact the ability for a resident to call in and make public comment and if like i said before if there is public comment and an item it would be removed from the consent calendar and individually voted on that's not changing from our current process so it's really i think a change that will make our meetings more streamlined more efficient while also ensuring that we give proper time and attention to the items that the public wants to comment on and participate in uh that's all i really have um so i guess available for any questions there might be council member gardener there was no discussion of your proposal in a prior meeting it was merely we merely decided to continue it to this meeting are there any questions or comments or sentimental regarding mayoral purchase mayor tim uh yes thank you councilmember gardner um we did have a little bit of discussion on it before it got tabled but um i guess i want to clarify just make sure i'm understanding on the public invited to be heard because right now we change the process so that they they need to sign up on friday um if they want to speak on it on an item but i think and maybe somebody could correct me if i'm wrong if if not if and we allow one hour um if people if only had let's say three people that that signed up on friday but yet people showed up on monday and didn't know the process if they showed up they would still be allowed to do public invited to be heard i think under the current process so i just want to make sure that if if someone doesn't know to you know have it in by friday and they show up are they still afforded the ability because then the staff wouldn't be there if they pull something so this does not impact public invited to be heard whatsoever um public invited to be heard is still a public comment session that's available before our council meetings and i think it's right here in the rules first come first serve basis uh speakers should be limited to a maximum of three minutes and it's on non-agenda items our current process an individual can sign up for public comment on an agenda item up until that item is heard and so that would not change so for example if um monday night came and there was a resident that wanted to speak on an agenda item um outside of public invited to be heard which of course is on non-agenda items that wouldn't change and so um you know there would be cases where staff would need to still be on standby possibly to present if if that happened but that wouldn't impact public invited to be heard it'd still still be limited to one hour as it's outlined in our rules and i unless i'm mistaken um that's not in our rules that they have to sign up on the friday before i i don't know where that came from i don't know i think i remember that from something so basically they're still off afforded the opportunity to make public comment we wouldn't but then well i guess it wouldn't matter because if they made a public comment we sometimes then ask questions of staff but then the staff would not be available because they didn't think it was they thought they didn't see that it was pulled well i no i think staff would still be available i mean our staff would still attend the council meetings and if there was a public commenter that signed up it would be pulled from the agenda and the staff would have to present on it just i mean very similar to how our consent calendar works right now it happened last monday night where there were two items on our consent calendar and the staff members still had to be on standby for in when those items were pulled they had to give a presentation and there was a formal vote so essentially it's not really changing much of anything other than moving those items onto the consent calendar under our current consent calendar process okay and then one more question which is um if for some reason a council member does not go to policy committee and study session and they just bypass that and go straight to the council a regular meeting would that automatically be pulled for presentation i would be open to amending this for that reason i mean i i think that's um relatively uncommon but of course any council member can pull an item under these rules up until 1 pm the day of the meeting so for example if i brought an item straight to the floor and didn't go through that process and you or any other council member didn't like that or wanted a presentation all you would do was let the city clerk know that you were pulling that and you wanted a presentation so yeah that would be well within yeah yeah so that yeah okay um and and also to be clear if anyone is voting no they must pull the item correct i mean just like under our current consent calendar if if you want to vote no on an item you have to pull it thank you let me just comment real quick i'm just not sure what problem we're trying to fix i get that it makes it easier on council makes might make it easier on staff but i failed to see the benefit to our residents because unless they followed it in policy committee and then in study session that it's they're getting uh no benefit of even a abbreviated presentation so i i think it actually harms the process well i i disagree with that and i'd like to respond to that before councilmember lawson i disagree with that pretty pretty strongly um it still maintains the ability for a resident to comment on an item and and using your logic then uh any items there's we shouldn't have a consent calendar at all because unless unless a resident has been following the process any items currently on our consent calendar they wouldn't be aware of the conversation and discussion so in fact i think helping ensure that our staff has more certainty and also ensuring that we're not debating what in many cases are very serious items at 11 and 12 o'clock at night when many of our residents are working have to get up for work the next day and can't follow council i actually i think that does help our our residents further questions comments mayor kaufman um councilman um i have a question councilmember gardner so i have a little bit of an issue with this some you know we've already limited publican to vitamin to be heard so we already done that for an hour now we're going to put this stipulation on here where and you know we still are inviting public and dubai to be heard but it still has some limitations to me i guess for council members too i've been on we've been on well you've been unserved for almost four years and i've served for seven sometimes we get information up to the point of the meeting it may be some new information or something where we might have additional questions and you're stipulating for the council member that we have to do this by one o'clock i guess for me that just i have a real issue with that because that's just putting a stipulation on the council member who may like i said sometimes there's you might think about no over the weekend or maybe up to this point but you may get some information prior to the council meeting which could change your mind or you might have additional questions so i guess there is no wiggle room you're exactly why are you choosing one o'clock i'm just asking about that why is one o'clock the number i would be i would be open to a different time but in fact if you do have questions or you thought about it over the weekend this gives you the opportunity to pull it off that's what this is for and so um you would have that opportunity i'd be open to adjusting that time i picked a time after discussing with staff that they thought was was reasonable but you know i certainly would be open to adjusting that time however if you had new thoughts over the weekend this would allow you to pull it off for a presentation to ask those additional questions so this really addresses that and in fact i you know this process is pretty similar um to the consent um operation how several other city councils operate um i researched several other cities including denver here in the metro area um they operate their council meetings the same way um with with cutoff times for call-ups and um it seems to work there okay i understand it works there and i understand that might be you you might have your decision by over the weekend and there sometimes things come up you know where it's up to the last minute where there's additional questions and information so i understand where you're coming from on that and maybe other councils do that i guess the question is if you are a city council person and you don't pull something by one o'clock then you're subjected to whatever your vote is that's going to be the vote for everything on there even though you may disagree with the item i'm just really stuck with that piece so that's why for me um i understand we want efficiency i understand what we want to you know we want to create this efficient model but um i just i i will be a no on this i won't be supporting it i just think that it leads to you know we're kind of limiting some of the voices of our residents you're kind of not giving council members an opportunity to maybe you know kind of forcing us into a time frame and i understand we're up late but that's the job that we do um so i i struggle with this so i won't be supporting it i know it probably will pass but just because of those reasons i won't be the i won't be supporting it yet but thank you for bringing it forward mayor can i respond to that so again to reiterate this has zero impact on the voices of our residents our residents will still have the opportunity for public invited to be heard they on non-agenda items and up until an item is called they still can call in so this has zero impact on the ability of the public to comment um and as far as the 1pm cutoff time like i said that was in discussions with staff though i'm certainly open to um adjusting that if there are uh suggestions councilman lawson if you have a suggestion on a time that you would feel more comfortable with thank you further questions or comments mayor uh councilman mcconnell thank you sir and thank you councilmember gardner for bringing this forward um my concern as this it currently stands is you know the one o'clock deadline comes and goes um staff is not present then to handle a situation like we had a couple weeks back where folks come up to testify and start a based off of their testimony we end up with questions that staff needs to answer for us because they might be items that we had not necessarily considered without constituent input so to me the concern is not so much limiting our constituents ability to speak because to your point they would still be able to do that but it's allowing us to actually ask follow-up questions of staff and engage with the comments that they brought up that we might not have considered beforehand and i don't think this allows that to happen then because you wouldn't have that staff present so again we currently utilize a consent agenda i i feel like i'm the only one that remembers that we utilize a consent agenda so there are currently items that never receive a formal presentation and the only way that those receive an individual vote is if a council member calls them up at the meeting or there is public comment like happened last monday we have public comment on two consent agenda items otherwise those items never receive a formal vote so all this is doing is expanding our current consent agenda process it is not changing the ability for um additional questions additional presentations anything like that further uh questions may i might have a comment some people are getting hung up on the one o'clock and this goes back to i think both councilmember marcano and lawson's point which is you're right we use the consent calendar i understand what you're trying to do um but we can all the way up until the point of it the consent calendar being there so there's no cutoff at one o'clock i think that's what they would like to do and i know that originally the thought was by having the one o'clock it could save staff but i think to your later point is it could get called up by because of a question from public invited be heard so maybe and again this is just me throwing out there for conversation the the one o'clock is actually not necessary as opposed to the you know the overall concept of putting everything there it can be removed up until the moment that it's you know consent calendar comes up yeah i i and i agree with that i think that was added because of some of the comments when it was a discussion last time but you're correct council members of onik currently staff still is available for presentation on an item if there is public comment like happened last monday and so there will not be an instance where staff is not available because again if there is a public comment they that item automatically gets pulled and so um that scenario won't happen so i understand the hang up and and i'm fine removing that i my original version did not have that in there because again if if there is a public comment staff has to be available for a presentation as is what happened last monday night further discussion mayor councilman thank you um so i think that removing the 1pm helps and that actually i was also going to suggest um but i still do have a concern in the sense that our residents aren't typically watching our policy committee meetings for sure and folks who watch council meetings don't necessarily watch study sessions and so it removes the most likely opportunity for a member of the public to get information about what it is that we're voting on i know that when i was a resident attending meetings before i was on council to talk about a specific issue i learned a lot and dug into other issues based on the presentations that were given by staff during the meetings that i was at and so i do think that for the purpose of transparency of educating the public and informing them about the decisions that we're making i do think that it is beneficial to have votes and presentations on the items that we currently have now your point about the consent calendar is well taken there are actually some very big and important issues that end up on consent calendar so i would lean more toward having requirements of more things coming off of consent calendar and into a presentation for the public so that they understand what the business of the city is than i would toward condensing more things into that consent calendar further discussion um seeing no further discussion mayor i'm sorry it's thanks i'm having a hard time with this because originally i was in favor of it um when it came up you know at the study session um before i'm having the difficulty with having the flexibility at that last minute to be able to change my vote to a no because i would be locked in by one o'clock to be basically okay i'm voting yes on whatever consent items that weren't pulled and i think that's my hang up again like i said i'm fine removing that that from there um and it would work exactly how our consent calendar works now items can be pulled at the council meeting okay so you would allow that change oh certainly that wasn't in the original version that that was the result of the conversation last time but my original version did not have a 1 pm cutoff time okay i thought it was going to be that's why that's why in this version that's in your packet tonight it's in blue because it was added after the last study session further discussion uh seeing none is her opposition mayor object mayor i object it's councilmember lawson councilmember lawson [Music] hello is your further objection medina excuse me councilmember medina whether objection a majority of arizonan objections um item number um uh 5a will not move forward uh i've never 5b program um the time is um as 803 council will stand in recess until 8 10. [Music] [Music] [Music] [Music] [Music] [Music] so [Music] [Music] [Music] [Music] do [Music] the study session of the oral city council monday uh august 1st 2022 is called back into session um ibe program update for roadway maintenance to get a participation project uh councilmember zlatan yeah mayor i believe that um this is going to be an update from staff on the progress towards and future plans of the roadway maintenance plan that we passed um a month ago or so so i'll turn off the staff let me call it thank you mayor and thank you marin city council for having us here tonight i'm joined by kim stewart and we're here to give you an update on the roadway maintenance plan that we have developed based on the certificate of participation funding option that we will be looking at um this is the first of many updates that we will be giving to you as we work through this program and process and just a reminder of where we started uh back at the winner workshop council member council supported council members of onix proposal to explore options to address the deferred roadway maintenance that we have as we were working through that we also through public works proposed an approach for pavement maintenance based on roadway conditions giving priority to the roadways in the worst conditions funding options were also explored as well as a creation of the transportation maintenance fund all these were presented to the police the transportation policy committee as well as um moving that forward to study session in may um during that time as a funding option city council approved debt funding to generate 35 million in proceeds from a certificate of participation fund for the additional roadway maintenance and the deferred maintenance that we have as well as that creation of the transportation maintenance fund and the june 4th spring workshop council supported moving forward with a communications and public engagement plan in the development focused on the implementation of the funded roadway maintenance projects and then the ordinance approving the use of lease purchase financing for the construction of the roadway improvements was inc approved in june so this this graphic care rights show here shows you our year maintenance plan so across the top this program has been developed to go from 2023 to 2027 and as you'll see down along the side it is broken into pavement which includes mill overlay surface treatment in-house that we work that we do in street reconstruction concrete repair that we do very important to do the concrete repair ahead of the pavement maintenance so that we repair the cracked sidewalk curb and gutter and have a clean slate when we're coming in with the paving it also is broken out into the cmci construction management construction inspection services that we utilize to support and keep tabs on the work as it moves forward making sure that it's to the standards that we have within the different programs here you'll see that the cop allocations are also broken out and that 35 million is distributed between 2023 and 2024 with our plan to be to use that those cop funds by the end of 2024 and that funding is going to be dedicated to the neighborhood streets in addition to some other funding that we have already established um down at the bottom what we wanted to illustrate for you is that how we're going to approach the classifications we're looking at locals collectors and arterials but you'll see the locals have the maximum amount for many of these years as it evens out as we get more of the deferred maintenance taken care of we're going to continue to address the residential roads through the time moving forward just re-establishing that program that we um that went away in 2016. um this i want to show you is again a map showing what the five-year plan looks like again 100 of those cop funds to be used by the end of the year of 2024 all the different strategies that we've talked about including mill and overlay surface treatment street reconstruction concrete curb and gutter and sidewalk annual residential paving program is reestablished and what's important here is you'll see in 2023 much of the red is within the neighborhoods but i also want to emphasize for you these are the these are we're addressing these roads in 2023 um based on priority of their current condition but then as we move forward we're going to continue addressing the residential streets in 2024 2025 even 2026 and 2027. this is a preliminary five-year plan but it gives us a really good idea of what we're targeting for and then if different um issues or priorities come up say for aurora water or excel we can flex the program as we need to this map is is specifically focused on 2023 and 2024. you'll see all of the green areas are the residential neighborhoods we have a few arterials and collectors as well um and what we're looking at here is actually 35 subdivisions that will have concrete repair and mill and overlay all the strategies will be employed and i do want to note just because it's been years for some of the neighborhood streets to be um milan overlaid some of those will require street reconstruction but as part of the community engagement and public outreach plan we'll be doing a lot of outreach and good work with the community for their understanding of what the end product is going to be this is just a little pie chart to show you sixty percent almost is going to the local streets we've got some collectors and a few arterials i also want to point out that we do have contingency just in case we have any unforeseen conditions that come up so we're holding a little bit of condition contingency just if if we need it if it's unneeded we'll flex it into the program and use it on other roadways so next steps what you've seen now are the preliminary locations not only for 2023 and 2024 but also through 2027. we're going to be refining those locations through the fall we're just kind of at the beginning especially for 2023 and 2024. part of that is going to be coordinating with other departments and programs one of the first steps that we're doing right now is collecting all the concrete repair needs for curb gutter and sidewalk getting those bids prepared so we can bid them out late this summer um also refining and finalizing the quantities and preparing the bid tabs for to advertise later this year for the mill and overlay the surface treatment and the street reconstruction so we're at the beginning stages we're going to be bringing updates back to you you're probably going to see some changes as things get finalized just as we get a better understanding of aurora water has some needs in some areas and and other utilities uh as well so with that i'm going to turn it over to kim and she's going to walk through the communications and medications plan thank you cindy next slide please so mayor and city council members thank you for an opportunity to speak with you about the outline of our communications plan um the goals we have for this plan are really to educate residents on the value of caring for what we have that would be the treatments or the strategies cindy spoke of applied to pavement conditions based on on the need at the time uh we also want to make sure we explain how the city can provide for what we need through additional resources and different funding sources added to our toolkit we want to make sure we build community awareness and excitement by fulfilling work that addresses a resident's priorities you'll remember the survey we did earlier this year we heard from residents that transportation roadways are a top priority we also want to demonstrate making the most of taxpayer dollars we know that's very important we want to be very accountable to our public and deliver on the city's responsibilities about this work we will track and report progress on projects and celebrate the successes that happen in the next couple of years and beyond and with that we want to create a project identity project identity with a brand next slide please so our proposed concept for a brand is here build up aurora care for what we have and provide for what we need we felt that that had a note of um responsibility and being good stewards of what our residents are providing in tax dollars so the brand communicates that the city is becoming stronger and better continuously improving and making progress delivering on promises to care for the investments we've made in our existing infrastructure and to provide what's needed now and into the future being responsible and accountable taxpayer dollars by maintaining these community assets and delivering residence priorities next slide thank you and so these are our target audiences it's not an exhaustive list but it's it's a primary list here of residents aurora businesses our homeowners groups city and community leaders certainly our boards and commissions the media will be very important city employees many of whom are residents in the city and community and civic organizations as well as our partners the chamber visitor etc to help amplify the message and help celebrate those successes we're making on roadway improvements next slide thanks so these are not the actual messages but they're key elements of the messages that you will be seeing um a city will pursue all existing financial options to address infrastructure priorities before referring measures to voters that was something discussed in the june workshop if you remember those guiding principles that were presented utilize existing funding solutions to care for what we have as is being done here with counselors leadership through the cops also to have a conversation about how can we do more that adding additional solutions to our toolkit funding solutions uh will help us provide for what we need listening to residence project priorities roadway maintenance to improve existing neighborhoods will be prioritized excuse me prioritized by street condition as cindy explained and that these projects are just the start that this residential street program will resume and be part of our annual road work next slide so a number of the tactics this again is not exhaustive but we want council's feedback along the way is that branded project signage will be out in neighborhoods before during and after the project work to show progress and um as we've been talking through these as a team one thing we envision is signs in neighborhoods when it's done a big sign across it saying completed as promised um we talked about partnering with community relations to make sure we over commute with neighborhood groups uh and residents on project information schedule impacts you know where detours have to occur what does that actually mean in that neighborhood um also written cuttings with elected officials and where possible neighborhood leaders and hoa folks uh to be able to let them help kick off a project social media next door is extremely active in rural so great place to help share the word on what's happening multilingual communications of course will be throughout the plan and we'll be working with media outlets newsletter updates those that are city produced as well as the neighborhood um hoa newsletters that they put out um we get a lot of response from those when we do um commute it there engage your roaring page we'll stand one up and that is where we'll have an internet back excuse me interactive project map and timeline of progress and successes of those projects so people can go on at their leisure and kind of take a look at what's happening around currently and in the future and of course aurora tv can help educate and do project profiles as these projects are kicked off and as they continue with a lot of updates to council uh not only on cindy's end but the projects but certainly what we're hearing and what we're doing with our community engagement and information next slide cindy thanks kim thank you so much um so the project timeline that's your timeline that we're sorry i'm getting some people i'm getting tonight we're here tonight council study session on wednesday we have our rating call with moody's which we'll be participating in that i think is at 11 am through august and september and probably a little bit beyond that we will be working for the concrete contractor repair or concrete repair procurement contracts we'll probably get uh put that out to multiple contractors so we can distribute them throughout the city uh september 7th will be the cop closing funding received through the fall we'll begin that concrete repair as we get the contracts awarded in december the pavement contract procurement will begin we'll probably get those bids early next year in february of 2023 we'll bring the rehabilitation plan finalized as i mentioned the map that we have now will be refined as we're working through the details and it will be much more firmed up later this year and early next year um so we'll bring that to taps as well the policy committee as well as a council study session and then february march looking for the contract award and hoping to start in april um with all of these great improvements that we're super excited to bring to the community and so opening up for any feedback or discussion thank you all right questions of uh staff mayor um sorry chelsea thank you yeah i am in full support of this i just wanted to say um as we are getting bids and going through that process i would really like to see um an aurora business i mean if they're in in the ballpark um concrete business in aurora they're they're in the ballpark and one thing to remember is you know that the city sales tax dollars would be coming back to the city anyways and i would just really love on some of these projects to start supporting uh local aurora businesses that's all further questions mayor um sorry uh mayor pretend yeah thank you um cindy when you're um putting out bid these um contracts for the concrete work um do you i mean do you lock in the pricing at that time or how does that work yeah we'll be getting bids from the contractors and the pricing that they provide will be through the um the extent of the contract and then you evaluate their um ability to obviously provide quality because i don't know if you probably saw i had an email today but from a constituent that thinks the paving that was done was not good yeah we'll have to we'll take a look at that mayor pro 10 but yeah i mean that's why we have the construction management construction inspection and our materials lab to help us make sure that everything is going into our standards thank you further questions this down uh any comments discussion i think that this was prairie information only so thank you very much for the presentation um item number 5c sales and use tax exemption direct government fees council members development yeah thanks mayor so this issue of the city assessing a sales tax to government fees came to my attention recently with the recently implemented uh implementation of the delivery fee that the legislature passed last year it's a 27 cent fee on all deliveries it was brought to my attention that we apply a sales tax that and looking into it it appears as though there are other government fees that the city applies our sales tax rate or our sales tax to typically i'm not in favor of creating any sorts of exemptions i would much rather do it across the board sells tax reduction for everything but um i don't think it's in any way defensible for us to be taxing not a product not a service but a government fee and so what this ordinance would do is for existing fee government fees and anything that would be created in the future for instance the state legislature passed another fee that will kick in in january of next year on grocery bags that fee would also be exempt from municipal sales tax so the ordinance just simply exempts all of those government related fees from the total purchase price to be exempt from sales tax and i'll turn it over to uh to staff to talk about the financial implications of it even mayor jeff edwards manager of tax um so the the implications on this are estimated to be around 220 000 that will go up as the fee that particular delivery fee that council member zavonik referenced is slated to go up based off of increases in inflation so i can answer any other questions or if you have any other information that you would like me to provide i'd be glad to to help out questions with staff in the sponsor mayor uh mayor pretend yeah i just want to say i'm in full support of this i i don't even like that we do fees because i think it's a way to get around tabor and and getting voter um approval on on something that you know is not a tax because it's a fee and certainly we shouldn't be taxing a fee um so i'm in full support that's what i prove yeah so in principle absolutely i support not taxing fees um but i did today make a purchase and the sales tax was charged on the amount of my purchase and then this fee was listed separately um so i don't know like do we know where it is that this taxing of the fee is happening um and why would some entities break it out that way and not do it and other entities tax the fee yeah thank you mayor councilmember coombs that's that's an excellent question unfortunately i it's really difficult to control exactly how that tax would be broken out on an invoice and most likely would be lumped into the total tax amount on the invoice itself mayor if i could all right councilman yeah councilmember coombs as i was researching this and jeff i might ask for your to jump in on this but there's a standard definition on total purchase price and not excluded from that is fees and so typically when you so for instance on this delivery um it's included in the total purchase price so if you order a sandwich and a bag of chips and a drink from somewhere let's say that totals 10 you add the fee in the total purchase price is the product plus the fee and then sales tax is then applied to that so there are times where the fee is broken out separately but it still assessed tax in in the case of uh aurora when and doing this we have the waste hire fee the new delivery fee and then the future bag fee that the ordinance as drafted would exempt from municipal sales tax mayor can i respond so yeah so the my point is that in the purchase that i made the fee was listed separately and after the tax so it wasn't being the fee wasn't being taxed so i guess i'm just confused about whether or not this is happening on that delivery fee because in my experience of making purchases for delivery that's not what i'm seeing happen so we can pass this and that's fine to make sure that other fees aren't being taxed but my concern is that we're saying something is happening that isn't happening further discussion here all right i wonder because that just passed so maybe i mean maybe some entities haven't caught up with it yet possibly and mayor yeah and so and uh cml is actually drafting let's model legislation for other municipalities to do this because it is in fact being taxed and i know that denver is taking this up tomorrow to exempt theirs is more narrowly focused on the bag fee that they have in place and the delivery fee but the delivery fee is in fact um a part of the total purchase price and being taxed and now whether or not in this wherever you were um you know to counsel or to ameripro tim's point uh there are some point of sale uh um or point-of-sale software services that vendors have that might not have caught up to it yet to have it you know included but it is in fact happening and that's why they have the estimate of what we would actually be saving from the city on this further questions for comic i see none is there opposition to moving item number 5c forward i see no opposition 5c will move forward i'm number 5d reimbursement agreement between 720 foundation and the city of aurora and other related matters uh councilman medina uh thank you mayor you know that i'm just uh want to see us reimburse the 720 foundation i just feel that in light of this 10th year anniversary and the things that happened to our residents that we would charge 25 000 to uh maintenance uh the sculpture that's that's in the 720 memorial i just think that to me we the city they made an agreement with the 720 memorial and i guess they agreed to pay 25 000 uh to be chunk over five years to pay for the maintenance and then the city would take it on and i just feel that uh having known a lot of the people and the families and survivors that they could better use that money for things like that to help that part of that community and so i'm just asking my colleagues to hopefully look at that and see if we can reimburse that funding thank you questions or comments uh saying no is there any objection of 5d moving forward i think none 5d will move forward seeing no other further business before the aurora city council study session meeting is adjourned thanks everybody [Music] [Music] [Music] so [Music] [Music] [Music] [Music] [Music] [Music] [Music] you