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HomeMy WebLinkAbout03/11/2008 Special Council Meeting MinutesMINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 PLACE AND DATE Marana Municipal Complex A. CALL TO ORDER AND ROLL CALL By Mayor Honea at 6:04 p.m. COUNCIL Ed Honea Mayor Present Herb Kai Vice Mayor Present Russell Clanagan Council Member Present Patti Comerford Council Member Present Carol McGorray Council Member Present Jon Post Council Member Present Roxanne Ziegler Council Member Present STAFF Mike Reuwsaat Town Manager Present Gilbert Davidson Deputy Town Manager Present Deb Thalasitis Assistant Town Manager Present Frank Cassidy Town Attorney Present Jocelyn Bronson Town Clerk Present B. PLEDGE OF ALLEGIANCE AND INVOCATION/MOMENT OF SILENCE Mayor Honea led the pledge of allegiance. C. APPROVAL OF AGENDA Motion: Approve, Moved by Vice Mayor Herb Kai, Seconded by Council Member Carol McGorray. D. CALL TO THE PUBLIC E. PRESENTATIONS - 1. Presentation: Capital Project Financing Alternatives Erik Montague presented to Council an overview through a slide presentation, including current market conditions, debt coverage information and draft calendar. He introduced Mark Reader from Stone & Youngberg as advisor to the Town regarding financing alternatives. Michael Cafiso is bond counsel and also a member of the team, but he was unable to attend the meeting. A copy of the slide presentation is on file with the Town Clerk. CIP projects under construction will require approximately $36.2 million in bond financing. MINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 Mark Reader addressed the bond issuance process under Arizona law for the new Council Members. He presented a grid of the major alternative financing options for city and town clients to help select the appropriate option for Marana. He then focused on the various types of financing -starting on page 7 of the presentation -and the requirements, the first being General Obligation Bonds. The next type of bonds are: Excise Tax Revenue Bonds, noting that this financing option does not require an election, and that this is the common financing alternative for cities and towns. Utility Revenue Bonds for water and wastewater facilities require no election, and is a common financing alternative. Oro Valley and Metro Water District have used this type of financing. Page 14 shows Special Improvement Districts (ID) (Tangerine Road fell into this category in 2006.) An annual assessment is paid to the town, 51 % of the property owners must agree to its formation, and ID bonds are considered a contingent liability to the Town's general fund. Community Facilities Districts are discussed on page 15 and are similar to improvement districts in that they benefit a particular area. The town is not at liability for a CFD failure to pay debt service on this. Mr. Reader shared a summary of the town's current debt profile, as shown on page 19 of the presentation. The big project was in 2003 for the Municipal Complex. Most of this debt is being repaid from the General Fund. On page 22, the Excise Tax Revenue Bond Credit Rating Criteria and Impact on the town is displayed. The Standard & Poor's credit rating shows an AA- credit rating on February 14, 2008. They are aware that the town is considering a new rating in 2008. The Fitch rating is A+ which is a notch below the S&P. However, discussions are ensuing with Mr. Montague on this point. Mr. Reader gave an overview of the criteria as outlined in the presentation. He then spoke to the goal which is to maintain the AA- and upgrade Fitch to a similar rating. Should the Council decide to move forward with additional bonds, there is still a lot of work ahead. Mr. Reader then gave a summary of market conditions and estimated interest rates. Due to the current economic trends, several bond insurance companies are having issues which limit the companies Mr. Reader will consider working with. Limits are currently at 2.87%; 4.75% with insurance would be the current rate for the town today. On page 28, the Pro-Forma Debt Service and Coverage Analysis gives an analysis at the fixed rate fora $30 million bond issue and the estimated debt service and coverage. Next, he presented Sources for Repayment which Mr. Montague reviewed with Council and the Contracting Sales Tax Revenues source slide on page 29. He also indicated that there is a draft financing calendar in the Council packet. MINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 Once there is an opportunity to structure the financing, staff will return to Council to request approval of a bond issuance. The calendar anticipates a financing opportunity early in June, 2008. Mayor Honea then asked for questions from the Council. Council Member Ziegler asked what the difference is between AA- and A+. Mr. Reader stated that the AA- rates are better and the better option would be to maintain the AA-. Bond insurance is a major factor in this. Mr. Montague noted that tonight's presentation is preliminary to any work that needs to be done. Council Member Post asked if some of the CIP projects might be held back in order to put money into FEMA-type projects that may come up. Mr. Montague stated that this is really the beginning of the debt service/financing project, and may encompass timing or the need to reevaluate any of the projects. The town is currently at 16% of its bond capacity. Council Member Ziegler asked about the project with the Twin Peaks Interchange. Mr. Montague noted that Barbara Johnson would be able to speak to that particular issue as well as the multiple revenue streams and financing for the project. One of the issues is injecting or infusing the project with enough cash at the appropriate times to meet the construction schedule. This particular project list was not intended to be all of the projects. 2. Presentation: Certificates of Excellence Mayor Honea presented this item. Mayor Honea read several of the ratings that the tournament received on various golf channels, which were very high. Mr. Davidson noted that the certificates of appreciation for work on the PGA event would be distributed to the staff tomorrow, as many of them were not able to be at the meeting. 3. Presentation: Overview of the Camino de Mariana project and the acquisitions needed to construct it Barbara Johnson presented to Council. Copies of the presentation are available for viewing in the Town Clerk's Office. Council Member Ziegler asked several questions about the two-lane and four-lane options and costs. Ms. Johnson noted that staff is currently looking at the feasibility of two versus four lanes to look at the relative value. Right now she has only engineer's estimates. She will be looking at all options to get the maximum benefit before she comes back to Council to make a recommendation. This is still part of the project development phase. Council Member Ziegler asked a question regarding the funding vs. cost overview slide. Ms. Johnson stated that until there is paper in hand to bid on jobs, she won't know what the jobs are going to cost. She is only able to deal in estimates at this time. Projects used to be split up in parts of projects. MINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 Ms. Johnson wants to have the total project cost so that she will have the real cost of the project to provide to Council. Ms. Johnson said she is trying to get the 404 permits by October of 2008. She then referred to the slide of right of way and easement acquisitions that involve 53 properties along the Camino de Mariana alignment. Council Member Ziegler asked how many residents there were in the 53 properties. Ms. Johnson will provide her with a copy, but noted that no properties would be acquired without Council approval. Council Member Post asked if there was some type of mechanism to receive extra funds for the repayment of the road -since State Land will make money off of this project. Mr. Reuwsaat noted that future impact fees would go to pay on the infrastructure of this project. Frank Cassidy addressed this question. He also stated that one of the reasons this item was on a study session agenda tonight was to be able to bring back a condemnation resolution at next week's regular meeting for Council approval. Council Member Comerford asked if these properties were all that would be acquired. Both Ms. Johnson and Mr. Cassidy noted that there could be even more properties if they are split. Ms. Johnson will get Council 11 x 17 maps showing property owners and those properties with structures. ANNOUNCEMENTS/UPDATES - PROCLAMATIONS - F. MAYOR AND COUNCIL REPORTS: SUMMARY OF CURRENT EVENTS Council Member McGorray reported on the Sonoran Desert Institute Dinner Awards- Sky Ranch and McClintock's at Saguaro Ranch received awards. Council Member Post reminded people of the arena activities during Founders' Day. Mayor Honea spoke about the Sonoran Desert Institute Dinner Awards. G. MANAGER'S REPORT: SUMMARY OF CURRENT EVENTS H. STAFF REPORTS GENERAL ORDER OF BUSINESS MINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 I. CONSENT AGENDA Motion: Approve, Moved by Council Member Russell Clanagan, Seconded by Council Member Patti Comerford. 1. Minutes of the January 8, 2008 regular session. J. COUNCIL ACTION K. BOARDS, COMMISSIONS AND COMMITTEES L. ITEMS FOR DISCUSSION/POSSIBLE ACTION 1. State Legislative Issues: Discussion/Direction/Action regarding all pending bills before the Legislature M. EXECUTIVE SESSIONS 1. Executive Session pursuant to A.R.S. §38-431.03 (A)(3), Council may ask for discussion or consultation for legal advice with the Town Attorney concerning any matter listed on this agenda. Z. Executive Session pursuant to A.R.S. § 38-431.03(A)(3),(4) and (7), discussion or consultation for legal advice with the Town's attorneys and discussion and to consider its position and instruct the Town Manager and staff concerning various water rights, water service, water acquisition, sewer service and related issues, including without limitation (a) the lawsuit entitled Town of Marana v. Pima County, Maricopa County Superior Court No. CV2008-001131, (b) the lawsuit entitled Pima County v Town of Marana, Pima County Superior Court No. 020077448, (c) possible acquisition of Tucson Water infrastructure and accounts located within the Marana town limits, (d) the Honea Heights Sewer project, and (e) certain confidential water resources that are the subject of the Water Services Consulting Agreement entered into by Resolution No. 2007-51. 3. Executive Session pursuant to A.R.S. §38-431.03 (A)(4) and (7) to consider the Town's position and instruct its representatives regarding negotiations for the purchase of property rights needed for the Twin Peaks interchange project, CIP number 2001-44, from the parcels of property generally identified as Pima County Assessor's parcel numbers, 226-08-0150, 226-15-0090, 226-15-008B, 226-15-017B, 226-15-018B and 226-15-019A, and to instruct the Town's attorneys in settlement negotiations and contemplated condemnation proceedings relating to the same property rights. N. FUTURE AGENDA ITEMS MINUTES OF SPECIAL SESSION COUNCIL MEETING MARANA MUNICIPAL COMPLEX DATE: MARCH 11, 2008 O. ADJOURNMENT Motion: Adjourn, Moved by Council Member Carol McGorray, Seconded by Council Member Patti Comerford CERTIFICATION I hereby certify that the foregoing are the true and correct minutes of the Marana Town Council meeting held on March 11, 2008. I further certify that a quorum was present. ~~~ OF Mq,qq®,~ celyn .Bronson, Town Clerk ~ ~.~ coaPOworF ~, = ~. s o00 ~ "' ~ SEAL t ,9~~~iuuu~~~~'~` O~ ®~~Il ~~t~-~``'