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HomeMy WebLinkAbout04/24/2007 Special Session Council Agenda Packet SPECIAL SESSION MARANA TOWN COUNCIL MEETING NOTICE AND AGENDA 11555 W. Civic Center Drive, Marana, Arizona 85653 April 24, 2007, at or after 7:00 p.m. Ed Honea, Mayor Herb Kai, Vice Mayor Bob Allen, Council Member Jim Blake, Council Member Patti Comerford, Council Member Tim Escobedo, Council Member Carol McGorray, Council Member ACTION MAY BE TAKEN BY THE COUNCIL ON ANY ITEM LISTED ON THIS AGENDA. Revisions to the agenda can occur up to 24 hours prior to the meeting. Revised agenda items appear in italics. AS A COURTESY TO OTHERS. PLEASE TURN OFF OR PUT IN SILENT MODE ALL PAGERS AND CELL PHONES. Welcome to this Marana Council meeting. Regular Council meetings are usually held the first and third Tuesday of each month at 7:00 p.m. at the Marana Town Hall, although the date or time may change, or Special Meetings may be called at other times and/or places. Contact Town Hall or watch for posted agendas for other meetings. This agenda may be revised up to 24 hours prior to the meeting. In such a case a new agenda will be posted in place of this agenda. If you are interested in speaking to the Council during Call to the Public, Public Hearings, or other agenda items, you must fill out a speaker card (located in the lobby outside the Council Chambers) and deliver it to the Town Clerk prior to the convening of the meeting. All persons attending the Council meeting, whether speaking to the Councilor not, are expected to observe the Council Rules, as well as the rules of politeness, propriety, decorum and good conduct. Any person interfering with the meeting in any way, or acting rudely or loudly will be removed from the meeting and will not be allowed to return. To better serve the citizens of Marana and others attending our meetings, the Council Chambers are wheelchair and handicapped accessible. Any person who, by reason of any disability, is in need of special services as a result of their disability, such as assistive listening devices, agenda materials printed in Braille or large print, a signer for the hearing impaired, etc., will be accommodated. Such special services are available upon prior request to the Town Clerk at least 10 working days prior to the Council meeting. Copies of the agenda are available the day of the meeting in the lobby outside the Council Chambers or online at www.marana.com. by linking to the Town Clerk page under Agendas, Minutes and Ordinances. For questions about the Council meetings, special services or procedures, please contact the Town Clerk, at 382-1999, Monday through Friday from 8:00 a.m. to 5:00 p.m. Posted no later than April 23, 2007, 7:00 p.m., at the Marana Municipal Complex, the Marana Operations Center and at www.marana.com under Town Clerk, Agendas, Minutes and Ordinances. SPECIAL SESSION MARAN A TOWN COUNCIL MEETING NOTICE AND AGENDA 11555 W. Civic Center Drive, Marana, Arizona 85653 April 24, 2007, at or after 7:00 p.m. SPECIAL SESSION A. CALL TO ORDER AND ROLL CALL B. PLEDGE OF ALLEGIANCE AND INVOCATION/MOMENT OF SILENCE c. APPROVAL OF AGENDA D. CALL TO THE PUBLIC At this time any member of the public is allowed to address the Town Council on any issue not already on tonight's agenda. The speaker may have up to three minutes to speak. Any persons wishing to address the Council must complete a speaker card located outside the Council Chambers and deliver it to the Town Clerk prior to the commencement of the meeting. Pursuant to the Arizona Open Meeting Law, at the conclusion of Call to the Public, individual members of the council may respond to criticism made by those who have addressed the Council, may ask staff to review the matter, or may ask that the matter be placed on a future agenda. GENERAL ORDER OF BUSINESS E. DISCUSSION/POSSIBLE ACTION 1. Resolution No. 2007-59: Relating to Public Works; authorizing the application for a CWSRF loan from the Water Infrastructure Finance Authority of Arizona (WIFA) to finance the Silverbell Road Wastewater Collector system. (Barbara Johnson) 2. Presentation: Marana Economic Blueprint. (Jim DeGrood) 3. Discussion and direction on Town policy relating to community facilities districts, with special consideration of whether to allow the sale of assessment bonds in addition to or instead of general obligation bonds in appropriate circumstances, with specific discussion of the possible application of the policy to the Saguaro Springs and The Villages of Tortolita development projects. (Frank Cassidy) F. ADJOURNMENT TOWN COUNCIL MEETING INFORMATION MEETING DATE: TOWN OF MARANA April 24, 2007 AGENDA ITEM: E.1 TO: MAYOR AND COUNCIL FROM: Barbara F. Johnson, Director or Public Works SUBJECT: Resolution No. 2007-59: Relating to Public Works; authorizing the application for a CWSRF loan from the Water Infrastructure Finance Authority of Arizona to finance the Silverbell Road Wastewater Collector system. DISCUSSION The Water Infrastructure Finance Authority (WIF A) is an independent agency of the State of Arizona and is authorized to finance the construction, rehabilitation and/or improvement of drinking water, wastewater, wastewater reclamation, and other water quality facilities/projects. Generally, WIF A offers borrowers below-market interest on loans for 100 percent of eligible project costs. As a 'bond bank,' WIF A is able to issue water quality bonds on behalf of communities for basic water infrastructure. Through active portfolio and financial management, WIF A provides significant savings due to lower interest rates and shared/reduced closing costs. WIF A is able to lower a borrower's interest costs to between 70 and 100 percent of WIF A's tax-exempt cost of borrowing. WIF A's principal tools for providing low interest financial assistance include the Clean Water Revolving Fund for publicly held wastewater treatment projects and the Drinking Water Revolving Fund for both publicly and privately held drinking water systems. Both funds are capitalized by contributions from the State and the U.S. Congress. The Silverbell Road Project includes the installation of a new sewer line and a portion of the cost can be funded by WIF A. ATTACHMENT Application. RECOMMENDATION Staff recommends approval of Resolution No. 2007-59, authorizing completion of the application to pursue the WIF A financing option. SUGGESTED MOTION I move to approve Resolution No 2007-59. {00004602.DOC /} TOWN COUNCIL MEETING INFORMATION MEETING DATE: TOWN OF MARANA April 24, 2007 AGENDA ITEM: E. 2 TO: MA YOR AND COUNCIL FROM: James DeGrood, Assistant Town Manager SUBJECT: Presentation: Marana Economic Blueprint DISCUSSION In March, Tucson Regional Economic Opportunities (TREO) completed and released the Economic Blueprint for the region's future economic development activities. The Economic Blueprint was the product of a six-month strategic planning effort reaching over 3000 participants. The effort included a Strengths, Weaknesses, Opportunities, Threats (SWOT) analysis, a Regional Economic Analysis, a Comparative Market Analysis, a Comparative Cost Analysis, an Industry Cluster Analysis and a Site Locator Review. Upon analyzing the results of these efforts, five focus areas were identified: High-Skilled/High- Wage Jobs Educational Excellence Urban Renaissance Livable Communities Collaborative Governance & Stewardship Success in these focus areas is key to a thriving region. The strategies identified for each focus area are relevant to Marana. TREO also announced a number of projects to implement the Economic Blueprint, including assisting the Town of Marana in the development of a community specific "Marana Economic Blueprint." The Marana Economic Blueprint is to be in alignment with the regional blueprint. The recently created Business and Economic Development Citizen Advisory Commission will serve as the steering committee for the Marana Economic Blueprint effort. The Commission has reviewed the scope of work outline and schedule and will be meeting on a biweekly basis in a workshop format throughout the development of the Economic Blueprint. The Economic Blueprint process will include the following steps: JRD/04/19/2007/10:25 AM I. Current Condition Identification and Framing of Issues Identification of the current business conditions that exist in Marana is fundamental to the development of a plan for the future. The Economic Blueprint process will require extensive outreach to the business community for data and perceptions, and a survey of the citizens is also necessary to ensure that the future economic development vision is in alignment with the values of both Marana's business and residential communities. The steps in this effort include development of Guiding Principles for the plan, identifying stakeholder groups, establishing an outreach plan, and developing survey instruments and questionnaires. II. Synthesis of Vision Once the surveys have been collected, SWOT and Gap analysis (a resource to assess actual versus potential performance) will be performed. The SWOT element will be used to identify where Marana is competitive currently and where business opportunities may exist. When this is considered with the results of the Regional Economic Blueprint, Marana's regional position can be gauged, and a vision of what Marana desires for its economic future will be produced. III. Identification of Goals and Strategies With a clear vision of the Town's desired economic future, goals, strategies and an implementation plan can be formulated. Implementation will be set forth in a plan to be presented to the Council and if approved, the Business Community. IV. Measuring Performance With the development of goals and strategies, measurements for success must be identified and a process for collecting the requisite data identified and implemented. Annual performance reporting is proposed. V. Review and Refinement With any plan, review of the plan in the context of the future conditions is needed to ensure that the plan is in alignment with the evolving community's values. Adjustment of the implementation plan should also be expected, dependant upon the success of implementation ATTACHMENT Proposed Timeline for Activities. RECOMMENDATION Staff requests Council comments and recommendations. SUGGESTED MOTION None required. -2- AGENDA ITEM: TOWN COUNCIL MEETING INFORMATION MEETING DATE: April 24, 2007 TOWN OF MARAN A E.3 TO: MAYOR AND COUNCIL FROM: Frank Cassidy, Town Attorney SUBJECT: Discussion and direction on Town policy relating to community facilities districts, with special consideration of whether to allow the sale of assessment bonds in addition to or instead of general obligation bonds in appropriate circumstances, with specific dis- cussion of the possible application of the policy to the Saguaro Springs and The Villages of Tortolita development projects. DISCUSSION At several study sessions concerning the then-proposed Gladden Farms Community Facilities District in early 2004, the Council debated and discussed the parameters of CFD bonds, and came to the general consensus that CFDs will sell general obligation bonds in an amount that can be repaid from secondary assessments (billed by the county treasurer with normal property tax bills) at an annual rate not to exceed $2.50 per $100 of assessed valuation (plus 30~ per $100 for operation and maintenance). A developer desiring a higher bond sale amount must protect the Town and taxpayers within the CFD by posting appropriate security to cover any amount in ex- cess of the assessed valuation. In 2004, the Council discussed but rejected the concept of having CFDs sell assessment bonds. Assessment bonds are assessed proportionately (typically on a per-acre basis) against the prop- erty within the CFD. Two primary factors seemed to steer the Council away from using assessment bonds. The first was that assessment bonds are typically repaid through direct semi-annual assessments sent to each of the affected property owners. After individual residential lots are sold, the semi-annual assessments are sent to each homeowner. Until 2005, CFD assessment bills were sent out by the municipality. The only way to avoid having a homeowner receive a bill directly from the mu- nicipality was to assure that the lot's assessment was paid off before the homeowner took title. But early payment of the assessments significantly reduces the economic viability of assessment bonds - instead of bonds being paid off at a low interest rate over many years, most of the bonds are paid off quickly under this approach. The second factor that seemed to steer the Council away from using assessment bonds was the potential for assessment inequality among different CFDs. The general obligation bond policy setting a $2.50 annual assessment per $100 of assessed valuation can be applied to all CFDs, thereby leveling the assessment burden among the various CFDs. The policy assures that home- {00004601.DOC /} - 1 - 4/19/20074:39 PM FJC owners living across the street from one another but in different CFDs will have the same general obligation bond assessment - $2.50 per $100 of assessed valuation. When CFDs sell assessment bonds, leveling the assessment burden is much more difficult. As- sessment bond assessments are placed on property when the assessment bonds are sold - long before any homes are built, and frequently before final plats are recorded. The assessment for a given block of property within the CFD is then proportioned as the block is divided into separate parcels and lots. Since there is no way to predict an eventual home's future assessed valuation, it is not possible to determine with any level of certainty the assessment's future effective rate per $100 of assessed valuation. Similarly-sized lots within a particular CFD will typically have the same total assessment bond assessment, even if the assessed values of the lots are significantly different due to the differences in size and quality of the homes constructed on them. Several things have changed over the past three years, and staff believes a fresh discussion of Town CFD policies is warranted. In particular, staff requests that Council take another look at the use of CFD assessment bonds, particularly as applied to the Saguaro Springs and The Vil- lages of Tortolita projects. Both of these projects propose to fund a significant regional transportation improvement through CFD financing - Saguaro Springs proposes to fund Twin Peaks Road through Rattlesnake Pass to the west edge of the Saguaro Springs project, and The Villages of Tortolita proposes to fund the Tortolita Boulevard freeway interchange. To fund these projects with general obligation bonds will require one of two approaches. One: The developer will need to obtain private financing to construct the improvement, with CFD general obligation bond financing being used to reimburse the construction cost. The payback period for this approach is likely to be protracted, as assessed valua- tions within the CFD rise over time to a level sufficient to support substantial general ob- ligation bond sales. Two: The developer will need to provide a huge letter of credit or other security to cover bond repayment costs until assessed valuations within the CFD are sufficient to cover the debt. This approach can be disastrous in a "meltdown" scenario (developer bankruptcy with an extended period when there is no development), because by law the assessment rate must be raised to whatever level is necessary to repay the bonds. Even though the Town's policy is not to sell bonds in a principal amount higher than can be repaid by an assessment of $2.50 per $100 of assessed valuation, there is no legal limit to how high the assessment rate can go. Bond counsel has reported that the annual assessments in a "melt- down" situation in Colorado exceeded the fair market value of the homes being assessed. In these instances, when CFD bonds are being used to fund regionally significant infrastructure, staff believes that the Town's CFD policy ought to allow consideration of assessment bonds. In the "meltdown" scenario, the assessment bond assessment is divided proportionately throughout the CFD - an individual homeowner will never be required to pay more than the assessment for his or her individual lot. The bond purchasers' recourse for a landowner's failure to pay the as- sessment is to foreclose on the particular parcel or lot for which the assessment was not paid. {00004601.DOC /} - 2 - 4/19/20074:39 PM FJC One of the two concerns about CFD assessment bonds raised by the Council in the 2004 study sessions has been resolved. In 2005, the Arizona Legislature amended the CFD statutes to allow assessment bond assessments to be billed by the county treasurer with the normal property tax bill. The Council's concern about unequal assessments among different CFDs has not been re- solved. However, this concern can be softened somewhat by modifying the Town's CFD policy to require that any request for CFD general obligation bond financing that occurs while CFD as- sessment bonds are still being repaid must take into consideration the assessment bond assess- ment's effective rate per $100 of assessed valuation. The modified CFD policy could require analysis of all current and proposed CFD assessments (adding together the existing assessment bond assessment effective rate plus the proposed general obligation bond assessment) for various lots within theCFD, to assure that the total effective CFD assessment rate does not create an ex- cessively disproportionate burden for homeowners in the CFD with assessment bond debt. The Town's financial advisor, Stone and Youngberg (Mike LaVallee), and the Town's bond counsel, Michael Cafiso, are scheduled to be in attendance to make a presentation concerning these issues and to answer any questions the Council may have concerning CFDs in general or particular CFD bond financing scenarios. RECOMMENDATION Staff recommends that the Council give consideration to allowing CFDs to consider the use of assessment bonds in appropriate circumstances, provided that (1) semi -annual assessments are included in property tax statements from the county treasurer and (2) the total effective CFD as- sessment rate does not create an excessively disproportionate burden for homeowners in the CFD with assessment bond debt. A TT ACHMENT(S) Presentation materials may be distributed just prior to the meeting. SUGGESTED MOTION Council's pleasure. {00004601.DOC I} - 3 - 4/19/20074:39 PM FJC