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Home My WebLink AboutAGENDApacket__02-25-25_0318_678 NOTICE OF MEETING BUDGET RETREAT FOUNTAIN HILLS TOWN COUNCIL Mayor Gerry M. Friedel Vice Mayor Hannah Toth Councilmember Gayle Earle Councilmember Brenda Kalivianakis Councilmember Rick Watts Councilmember Peggy McMahon Councilmember Allen Skillicorn TIME:8:30 AM - RETREAT WHEN:TUESDAY, FEBRUARY 25, 2025 WHERE:FOUNTAIN HILLS COUNCIL CHAMBERS 16705 E. AVENUE OF THE FOUNTAINS, FOUNTAIN HILLS, AZ Councilmembers of the Town of Fountain Hills will attend either in person or by telephone conference call; a quorum of the Town’s various Commission, Committee or Board members may be in attendance at the Council meeting. Notice is hereby given that pursuant to A.R.S. §1-602.A.9, subject to certain specified statutory exceptions, parents have a right to consent before the State or any of its political subdivisions make a video or audio recording of a minor child. Meetings of the Town Council are audio and/or video recorded and, as a result, proceedings in which children are present may be subject to such recording. Parents, in order to exercise their rights, may either file written consent with the Town Clerk to such recording, or take personal action to ensure that their child or children are not present when a recording may be made. If a child is present at the time a recording is made, the Town will assume that the rights afforded parents pursuant to A.R.S. §1-602.A.9 have been waived. AGENDA 1.Call to Order – Mayor Friedel 2.Roll Call – Mayor Friedel 3.Presentation of the 2nd Quarter 2025 Revenue Update & Fiscal Year 2026 Outlook. 4.Review of the Fountain Hills Community Center and Special Event Fees. 5.Review of the proposed FY 26 Capital Projects for the Public Works and Community Services 5.Review of the proposed FY 26 Capital Projects for the Public Works and Community Services Departments. 6.Review of proposed Downtown Budget Supplements. 7.Review of the Town's Special Taxing Districts. 8.Review of proposed membership in the Regional Automatic Aid (AA) System for Fountain Hills Fire Services. 9.Review of Council's supplemental requests and directions to staff. 10.Adjournment Dated this 19th day of February, 2025. The Town of Fountain Hills endeavors to make all public meetings accessible to persons with disabilities. Please call 480-816-5100 (voice) or 1-800-367-8939 (TDD) 48 hours prior to the meeting to request a reasonable accommodation to participate in the meeting or to obtain agenda information in large print format. Supporting documentation and staff reports furnished the Council with this agenda are available for review in the Clerk's Office. Town Council Work Session of February 25, 2025 2 of 2 ITEM 3. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Administration Prepared by: Paul Soldinger, Chief Financial Officer Staff Contact Information: Paul Soldinger, Chief Financial Officer Request to Town Council Retreat (Agenda Language): Presentation of the 2nd Quarter 2025 Revenue Update & Fiscal Year 2026 Outlook. Staff Summary (Background) BUDGET UPDATE AND FORECAST: Staff will present the 2nd Quarter 2025 Revenue Update & Fiscal Year 2026 Outlook, which will include but not limited to the following topics: Budget Process and Timeline Considerations Final Environment Program Supplements Budget Reductions Already Implemented by Staff Revenue Impacts, including Possible Food Tax Legislation MCSO Law Enforcement Cost Notification for FY2026 Attachments Council Retreat - Revenue Outlook Form Review Inbox Reviewed By Date Town Attorney Aaron D. Arnson 02/11/2025 11:17 AM Town Manager Kandace French Contreras 02/11/2025 02:08 PM Kandace French Contreras 02/11/2025 02:08 PM Stop has been removed Kandace French Contreras 02/11/2025 02:08 PM Kandace French Contreras 02/18/2025 05:03 PM Town Manager Form Started By: Paul Soldinger Started On: 02/11/2025 10:39 AM FY25 Revenue Update & FY26 Outlook Paul Soldinger, Chief Financial Officer February 25, 2025 2nd Quarter FY25 Revenue Update Net Taxable Activity •Total Net Taxable Activity for Quarter 2 of FY25 was $179.3M •Decreased by $9.4M from the same period in FY24 2nd Quarter Revenue Update $0 $20 $40 $60 $80 $100 $120 Jul 1 Aug 2 Sep 3 Oct 4 Nov 5 Dec 6 Jan 7 Feb 8 Mar 9 Apr 10 May 11 Jun 12 Mi l l i o n s Net Taxable Activity by Fiscal Year & Period 2021 2022 2023 2024 2025 Total TPT Collections •Includes all TPT reporting categories for all funds •Projected $4.70M •Collected $5.04M •$0.34M more than projected •Decrease of 6.81% compared to FY24 2nd Quarter Revenue Update $- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Mi l l i o n s Total TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 4,940,673 5,403,449 5,035,683 -6.81% TPT Revenues Retail Sales •Includes Local and Online Retail Sales and Use Tax •Projected $2.67M •Collected $2.64M •$25K less than projected •Decrease of 0.57% compared to FY24 2nd Quarter Revenue Update $- $200 $400 $600 $800 $1,000 $1,200 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Retail - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 2,624,054 2,654,837 2,639,578 -0.57% Retail Sales Retail Sales – without food sales •Retail sales excluding food tax may better indicate local shopping trends •Decrease of 0.38% compared to FY24 2nd Quarter Revenue Update $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 FY2023 FY2024 FY2025 Mi l l i o n s Retail TPT - without Food Tax 2nd quarter FY2023 FY2024 FY2025 Change from FY24 2nd quarter 2,138,722 2,142,377 2,134,130 -0.38% Retail sales - without food sales Retail Sales – Remote Sellers •Remote sales (within retail sales) may better indicate online shopping trends •Decrease of 3.22% compared to FY24 2nd Quarter Revenue Update FY2023 FY2024 FY2025 Change from FY24 2nd quarter 368,789 483,956 468,366 -3.22% Total Remote Sellers $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 FY2023 FY2024 FY2025 Retail TPT - Remote Sellers 2nd quarter Construction •Includes Prime Contracting and Speculative Builders •Projected $471K •Collected $746K •$275K more than projected •Decrease of 22.82% compared to FY24 •Audit collection of $450K in FY23 skews prior comparisons 2nd Quarter Revenue Update $- $200 $400 $600 $800 $1,000 $1,200 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Construction - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 Large Taxable Event & Audit Collection in FY23 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 720,032 966,106 745,598 -22.82% Construction Utilities & Communications •Includes Water, Sewer, Electricity, Cable, Natural Gas, and Internet Services •Projected $418K •Collected $456K •$38K more than projected •Increase of 3.58% compared to FY24 2nd Quarter Revenue Update $- $50 $100 $150 $200 $250 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Utilities - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 402,028 440,338 456,112 3.58% Utilities & Communications Real Estate •Includes Long-Term Residential and Commercial Rentals •Projected $333K •Collected $305K •$28K less than projected •Increase of 4.18% compared to FY24 2nd Quarter Revenue Update $- $50 $100 $150 $200 $250 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Real Estate - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 289,077 292,549 304,767 4.18% Real Estate Restaurants and Bars •Includes Local Restaurants (drive thru, sit-down, and delivery) and Bars •Projected $359K •Collected $331K •$28K less than projected •Decrease of 16.86% compared to FY24 2nd Quarter Revenue Update $- $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Restaurants/Bars - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 371,176 398,130 330,995 -16.86% Restaurants & Bars Services •Includes Hotels, Golf, Tours, and Short-Term Residential Rentals •Projected $419K •Collected $558K •$139K more than projected •Decrease of 14.31% compared to FY24 2nd Quarter Revenue Update $- $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Th o u s a n d s Services - TPT Collections by Fiscal Year 2021 2022 2023 2024 2025 FY2023 FY2024 FY2025 Change from FY24 2nd quarter 529,270 650,848 557,727 -14.31% Services State Shared Revenue 2nd Quarter Revenue Update •Projected $907K •Collected $897K •Projected $1.28M •Collected $1.26M $400 $350 $300 $250 $200 $150 $100 $50 Jul 1 Aug 2 Sep 3 Oct 4 Nov 5 Dec 6 Jan 7 Feb 8 Mar 9 Apr 10 May 11 Jun 12 Th o u s a n d s State Shared Revenue - Sales Tax 2021 2022 2023 2024 2025 $600 $550 $500 $450 $400 $350 $300 $250 $200 Jul 1 Aug 2 Sep 3 Oct 4 Nov 5 Dec 6 Jan 7 Feb 8 Mar 9 Apr 10 May 11 Jun 12 Th o u s a n d s State Shared Revenue - Income Tax 2021 2022 2023 2024 2025 State Shared Revenue 2nd Quarter Revenue Update •Projected $462K •Collected $468K •Projected $305K •Collected $299K $150 $125 $100 $75 $50 $25 Jul 1 Aug 2 Sep 3 Oct 4 Nov 5 Dec 6 Jan 7 Feb 8 Mar 9 Apr 10 May 11 Jun 12 Th o u s a n d s State Shared Revenue - Vehicle License Tax 2021 2022 2023 2024 2025 $210 $190 $170 $150 $130 $110 $90 $70 $50 Jul 1 Aug 2 Sep 3 Oct 4 Nov 5 Dec 6 Jan 7 Feb 8 Mar 9 Apr 10 May 11 Jun 12 Th o u s a n d s Highway User Revenue Fund (HURF) 2021 2022 2023 2024 2025 Outlook for Fiscal Year 2026 FY2026 Budget Milestones •Initial Revenue Projections completed – 1/6/2025 •Departments submitted supplemental requests to Town Manager– throughout January 2025 •Council Retreat – Today (2/25/2025) •Budget Open House – 3/12/2025 •Capital Improvement Plan (CIP) Work Session – 3/25/2025 •Council provides direction on CIP and funding for projects Budget Timeline FY2026 Budget Milestones •Proposed Budget Work Session – 4/8/2025 •Council discusses proposed budget and provides direction for Tentative budget the following month •Tentative Budget Adoption – 5/6/2025 Regular Meeting (Public Hearing) •Tentative Budget sets the maximum amount the Town may budget for FY2026 •Final Budget Adoption – 6/3/2025 Regular Meeting (Public Hearing) •Council considers adoption of final budget for FY2026 Town operations Budget Timeline Initial FY26 Revenue Projections FY2025 (current year) •General Fund: $25.82M •Local Sales Taxes: $14.9M •State Shared Income Taxes: $5.1M •State Shared Sales Taxes: $3.6M •Investment Income: $100k Revenue Projections FY2026 Initial Projections •General Fund: $26.25M •Local Sales Taxes: $15.2M •State Shared Income Taxes: $4.6M •State Shared Sales Taxes: $3.7M •Investment Income: $349k Initial FY26 Revenue Projections FY2025 (current year) •Streets Fund: $4.4M •Local Sales Taxes: $1.21M •HURF: $1.82M •Vehicle License Taxes: $1.22M •Investment Income: $10k Revenue Projections FY2026 Initial Projections •Streets Fund: $4.7M •Local Sales Taxes: $1.26M •HURF: $1.85M •Vehicle License Taxes: $1.26M •Investment Income: $191k Local Sales Taxes - Split Revenues Revenue Splits $15,192,000 $1,260,016 $126,002 $504,006 $1,188,207 Local Sales Tax – FY26 Initial Projections* General fund Streets fund Downtown fund Economic development fund Capital projects fund *Based on past Town Council approvals General Fund: •FY24 actual: $16.8 million •FY25 projected: $14.9 million •FY26 projected: $15.2 million Streets fund: •FY24 actual: $1.42 million •FY25 projected: $1.21 million •FY26 projected: $1.26 million Econ and Downtown funds: •FY24 actual: $709k •FY25 projected: $606k •FY26 projected: $630k Capital projects fund: •FY24 actual: $1.60 million •FY25 projected: $905k •FY26 projected: $1.19 million Environmental Program •Environmental Fund will be sunset at end of FY25 •Public Works Department submitted proposed supplemental requests: Key Supplemental Requests – FY26 Ongoing Supplemental Budget Requests Number Request Title Department Manager Recommendation BA-100-11-ENV Annual MS4 Permit Fees Public Works 10,000 BA-100-12-ENV Wash, Dam and Drainage Sliver Maintenance Public Works 275,000 BA-100-13-ENV DAM INSPECTION AND MAINT Public Works 13,400 BA-100-15-ENV MS4 Professional Services Public Works 103,000 BA-100-17-ENV Annual Electronics Recycling Event Public Works 2,500 BA-100-18-ENV Annual Household Hazardous Waste Event Public Works 2,500 BA-100-19-ENV Environmental Remediation for Oil Spills Public Works 10,000 BA-100-20-ENV Street Sweeping Contract Public Works 135,920 Total General Fund: $552,320 Budget Reductions Already Implemented •Reduced 2 full-time vacant positions to part-time, based on a review of workload: •IT Specialist (1.0 FTE 0.6 FTE) •Reduced General Fund budget by about $41,000 •Building Permit Technician (1.0 FTE 0.6 FTE) •Reduced General Fund budget by about $40,000 Budget Reductions – FY26 •Removed 2 additional budgeted expenditure items that have not been used •Reduced General Fund budget by another $20,000 MCSO Cost Notification Decreased •MCSO contract includes an automatic renewal through FY2029 Budget Reductions – FY26 •Town receives MCSO cost notification every year in February, which is implemented into budget for Law Enforcement •FY2026 MCSO Cost Notification was received on 2/5/2025 MCSO Cost Notification Decreased •MCSO pension costs decreased after Maricopa County paid down PSPRS pension liabilities in 2023. These cost savings decreased contracted benefit rates, resulting in Cost Notification decreasing by $373k (about 6%) Budget Reductions – FY26 FY2025 MCSO Contract $6.13M FY2026 MCSO Contract $5.76M HCR2021 – Food Tax – Possible Impact •Food for Home Consumption – TPT Code 062 – 2.9% local sales tax rate •Food sold at grocery stores and other retail stores •Does not include food sold at restaurants and bars (TPT Code 011) Future Revenue Impacts FY2022 FY2023 FY2024 Food Tax (TPT Code 62):1,871,247$ 2,081,908$ 2,179,521 Total Local Sales Taxes: 17,660,758$ 20,586,294$ 20,559,929$ Percentage of Total Local Sales Taxes: 10.6% 10.1% 10.6% Total Town Revenues: 35,025,597 40,931,231 40,201,766 Percentage of Total Town Revenues: 5.3% 5.1% 5.4% ITEM 4. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Community Services Prepared by: Kevin Snipes, Community Services Director Staff Contact Information: Kevin Snipes, Community Services Director Request to Town Council Retreat (Agenda Language): Review of the Fountain Hills Community Center and Special Event Fees. Staff Summary (Background) Several council members have asked about the fees and discounts that are given to groups using the Community Center and our other facilities for special events. This presentation will highlight the discounts given and provide the council with the opportunity to amend any of the fees currently being charged. Attachments CC Fees Presentation Form Review Inbox Reviewed By Date Clerk Kandace French Contreras 02/11/2025 02:07 PM Kandace French Contreras 02/11/2025 02:07 PM Stop has been removed Kandace French Contreras 02/11/2025 02:07 PM Kandace French Contreras 02/18/2025 05:04 PM Town Manager Form Started By: Kevin Snipes Started On: 02/11/2025 11:56 AM Presented by Kevin Snipes Community Services Director Community Center and Special Event Fees/Waivers Average charges Per Meeting $77.65 $206.80 $103.40 $206.80 $147.08 $155.10 $150.38 Fees and Discounts 2 Full Price Per Meeting $155.10 $561.02 $354.22 $561.02 $397.90 1BR $561.36/2BR $871.36 2hrs $404.50 4hrs $507.90 Yearly charge With discount $271.43 $1,861.20 $930.60 $2,068.00 $1,764.96 $1,706.10 $3,238.55 Yearly without Discount $2,791.80 $5,049.18 $3,187.98 $5,179.88 $4,774.80 $6,174.96 - $9,587.16 10,517.00 - $13,205.40 Difference $2520.37 $3187.98 $2257.38 $3111.88 $3009.84 $4468.86 - $7881.06 $7278.45 - $9966.85 Total Donations By the Town to the Groups 3 Yearly Charges With Discounts $11,840.84 Yearly Charges Without Discounts $43,776.20 Yearly Difference $31,935.36 4 Fee reductions or no charge •First 60hrs free then 50% off room rentals •Free stage installation •Previous direction allowed local non-profit pricing for a Scottsdale non-profit •Free items: •Walker Board •Microphones •Screens •Projectors •Coffee •Reservations outside of standard hours of operation •50% reduction in direct staffing cost recovery Options Give all groups the same discounted rate which would include the following options: Option 1) Apply Current Resident/Nonprofit rates (no Sunday rentals) Mon-Thur: $25 classroom 2hr min, $50 per ballroom 4hr min Fri-Sat: $75 per ballroom 4hr min Option 2) Create separate nonprofit Discounted rate options 10% off above rates Mon-Thur: $22.5 classroom 2hr min, $45 per ballroom 4hr min Fri-Sat: $67.5 per ballroom 4hr min 30% off above rates Mon-Thur: $17.5 classroom 2hr min, $35 per ballroom 4hr min Fri-Sat: $52.5 per ballroom 4hr min Meeting Optional Extras $25.00 fee for each of the following, per meeting: •All Audio Video options, including: Video projector and screen, flat screen TV, microphones, speakers, walker display board, etc. •Coffee service •Stage setup at the normal fee of $25.00 per section, per meeting Special Event Fee Waivers Chamber of Commerce – fees waived100% •Fall Festival - $14,000 •Spring Festival - $14,000 •FH Days - $1,250 •Stroll in the Glow - $1,500 (will move up to $3,250 next year for recent increased event size) •Thanksgiving Day Parade - $2,500 o Town also covers 100% of the road closures, portable restrooms, and MCSO fees as an extension of Turkey Trot. 50% of those fees would be $8,000+. Total: $40,500 Fountain Hills Ministerial Association – 50% (Easter Service) $200.00 Phoenix Children’s Hospital (Concours in the Hills) – 75% $5,250 Farmers Market & Art on the Ave – 100% (Town Invited Event) $400.00/week Chabad of Fountain Hills – 50% $200.00 (Values in red are amounts waived) Special Event Fee Waivers Special Event Fee Waivers Dark Sky Festival – 100% year one, 50% year two, no discount starting April 2025 Memorial Disc Golf – 100%, Part of the contract with the FH Disc Golf Club in exchange for course maintenance FHUSD – 100%, IGA Sonoran Conservancy Fountain Hills – 100% (ramada rentals) Questions/Comments ITEM 5. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Public Works Prepared by: Justin Weldy, Public Works Director Staff Contact Information: Justin Weldy, Public Works Director Request to Town Council Retreat (Agenda Language): Review of the proposed FY 26 Capital Projects for the Public Works and Community Services Departments. Staff Summary (Background) Shea Boulevard widening: Shea Blvd is a road of regional significance; Shea Blvd has also been listed on the National Highway System. Shea Blvd is the only arterial level road connection between Scottsdale and Mesa north of McDowell Road; and is the only arterial road feeding to the Beeline Highway north of McDowell Road. (The environmental issues precluding the extension of Dynamite Road to the north, and the Salt River-Pima Indian Community on the south, make it likely that Shea Blvd will remain the only such connection for virtually any foreseeable planning horizon.) Downtown Signage: As part of the Downtown Revitalization efforts, this project focuses on the design, fabrication, and installation of signage over a two-year period. This project aligns with the goals of the Downtown Strategy approved by the Town Council in September 2024. Downtown Streetscape Improvement Program: The Downtown Streetscape Improvement Program includes the design and construction of enhancements to the East and West halves of the Avenue of the Fountains, Verde River Drive, and Parkview Avenue. Palomino Boulevard Reconstruction: This project involves the full-depth removal and replacement of the existing asphalt pavement on Palomino Boulevard. Staff will present a subsequent CIP presentation during the March 25, 2025, Council Work Session as part of the budget process, which will incorporate any feedback and direction provided at this workshop. Fiscal Impact Fiscal Impact:N/A Budget Reference:N/A Funding Source:Capital Projects Fund If Multiple Funds utilized, list here:N/A Budgeted: if No, attach Budget Adjustment Form:N/A Attachments Capital Improvement Presentation Form Review Inbox Reviewed By Date Clerk Kandace French Contreras 02/12/2025 02:02 PM Kandace French Contreras 02/12/2025 02:02 PM Stop has been removed Kandace French Contreras 02/12/2025 02:02 PM Kandace French Contreras 02/12/2025 02:10 PM Public Works Director (Originator)Justin Weldy 02/18/2025 10:44 AM Justin Weldy 02/18/2025 10:44 AM Stop has been removed Justin Weldy 02/18/2025 10:44 AM Kandace French Contreras 02/18/2025 05:03 PM Town Manager Form Started By: Justin Weldy Started On: 02/11/2025 01:27 PM Kevin Snipes, Community Services DirectorJustin T. Weldy, Public Works Director CAPITAL PROJECT PREVIEW Presented by Community Services Capital Projects Discussion 2 Centennial Pavilion Shade Lighting •$50,000.00 •Dark Sky Compliant lighting Centennial Pavilion Shade Lighting Desert Vista Pump Enclosure $350,000 Protection for irrigation pump and electrical from water and sun damage •$50,000 •Signage improvement •Dead Tree Removal and Planting •Resod High Traffic Areas •Splash Pad Renovation Desert Vista/Dog Park Renovation $50,000 Business and Event Promoter Requested Fountain Park Splash Pad Shade Electrical and Lighting Fountain Park Ramadas $520,000 Replace Five 22Yr/old Ramadas Four Peaks Electrical Building $250,000 Business and Event Request Public Works Capital Projects Discussion 10 FY 2026 Street Paving SelectionsCouncil/Public Driven Palomino Blvd (Palisades Blvd to Fountain Hills Blvd) Estimated Cost: $5.4M 9’ SHLDR 15’ TRVL LANE 12’ TWLTL 15’ TRVL LANE 9’ SHLDR EXISTING CONDITIONS S6058 – Shea Boulevard Widening South Side Between Palisades Blvd & FHBLVD State Funding (Prop 400) Total Construction Cost - $3M State Share - $2.1M (70%) Town Share - $900k (30%) Development Fee Eligible Downtown Streetscape Improvements Multi-Year Project to design and install Infrastructure Improvements as part of the Council-Approved Downtown Strategy Four Phases are proposed for completion over a 5-year period •Eastern Half of The Avenue (Verde River to Saguaro) •Western Half of The Avenue (La Montana to Verde River) •Verde River Drive •Parkview Avenue Downtown Streetscape Improvements Each Phase includes Design and Construction. Design of the Eastern half of The Avenue is proposed for FY26. Proposed improvements include the widening of the sidewalk to accommodate outdoor cafes, relocation of street lights, removal of palm trees and the installation of shade trees, utility relocations and new string lights running parallel to the Avenue Downtown Streetscape Improvements Downtown Streetscape Improvements Capital Projects FY26 FY27 FY28 FY29 FY30 Total Design $225,000 $ 238,000 $ 201,000 $ 314,000 N/A $ 978,000 Construction N/A $2,245,000 $2,372,000 $2,003,000 $3,135,000 $9,755,000 Total:$225,000 $2,483,000 $2,573,000 $2,317,000 $3,135,000 $10,733,000 Design of East ½ of Avenue Const. of East ½ PLUS Design of West ½ Const. of West ½ PLUS Design of Verde River Const. of Verde River PLUS Design of Parkview Construction of Parkview Downtown Streetscape Improvements Capital Projects Design Cost Construction Cost Total Cost East ½ of Avenue $225,000 $2,245,000 $2,470,000 West ½ of Avenue $238,000 $2,372,000 $2,610,000 Verde River Dr $201,000 $2,003,000 $2,204,000 Parkview Ave $314,000 $3,135,000 $3,449,000 Total:$978,000 $9,755,000 $10,733,000 Downtown Signage Signage will provide a clear sense of arrival to the Downtown Area (different from Wayfinding Signage) Will identify the specific Downtown District (Entertainment, Business or Medical) Aligns with the goals of the Downtown Strategy To be installed over a 2-year period for $250k per year Questions ITEM 6. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Administration Prepared by: Amanda Jacobs, Economic Development Director Staff Contact Information: Amanda Jacobs, Economic Development Director Request to Town Council Retreat (Agenda Language): Review of proposed Downtown Budget Supplements. Staff Summary (Background): The Downtown Strategy has not been updated since 2009. In September 2023, Council unanimously approved a three-year Community Economic Development Strategy (CEDS). One of the implementation strategies within the CEDS is to "Create a new Downtown Strategy consistent with current economic trends." In November 2023, Council provided support for a staff-driven process to update the Downtown Strategy. On September 4, 2024, Council unanimously approved and adopted an updated Downtown Strategy (Attachment 1). During the December 5 Council Work Session, staff presented a proposed implementation strategy for the next five (5) years that will impact the Capital Projects Fund and Downtown Fund. The purpose of the February 25 Council Retreat is to present a modified supplement list within the Downtown Fund reducing ongoing projects from $150,000 to $75,000 (Attachment 3). Attachments Downtown Strategy Downtown Map Downtown Proposed Supplements Form Review Inbox Reviewed By Date Town Attorney Aaron D. Arnson 02/11/2025 05:05 PM Town Manager Kandace French Contreras 02/12/2025 02:02 PM Kandace French Contreras 02/12/2025 02:02 PM Kandace French Contreras 02/12/2025 03:23 PM Economic Development Director Amanda Jacobs 02/12/2025 04:27 PM Amanda Jacobs 02/12/2025 04:27 PM Kandace French Contreras 02/18/2025 05:05 PM Town Manager Form Started By: Amanda Jacobs Started On: 02/04/2025 10:06 AM P a g e1 | Fountain Hills Downtown Strategy Town’s Mission The Town of Fountain Hills’ purpose is to serve the best interests of the community by: providing for the safety and well-being of its residents and visitors; respecting its special, small-town character and quality of life; providing superior public services; sustaining the public trust through open and responsive government; and maintaining the stewardship and preservation of its financial and natural resources. To serve and respect and provide trust and stewardship. Town’s Vision Fountain Hills is a distinctive community designed to invigorate the body, mind and spirit, and strives to: Be stewards of this unique enclave, dedicated to preserving the environment and visual aesthetic and to living in balance with the Sonoran Desert; Champion the diversity of experiences our residents bring to our community and rely on this depth of experience to innovatively address our challenges; Be economically sustainable and anchor our vitality in an active, vibrant town core that serves us culturally, socially and economically; and, Be civic-minded and friendly, taking responsibility for our Town’s success by building partnerships and investing our talent and resources. Executive Summary The Downtown Strategy has not been updated since 2009. In September 2023, Council unanimously approved a three-year Community Economic Development Strategy (CEDS). One of the implementation strategies within the CEDS is to “Create a new Downtown Strategy consistent with current economic trends.” In November 2023, Council provided support for a staff-driven process to update the Downtown Strategy. For the purpose of developing this updated strategy, the area considered was north of El Lago, east of La Montana, and west of Foutain Park. This total area was divided into five sub-areas to consider some of the unique aspects of different portions of the downtown area. Staff held six focus group meetings with residents and businesses, conducted four electronic surveys and a public open house. Based on the feedback received, the Downtown Strategy focuses on four focus areas: x Land Use x Infrastructure x Economic Vitality x Public Spaces/Placemaking Background A vision plan was developed for the Downtown (formerly Town Center) in 2009. Over the last 14 years, several elements have been implemented to include the installation of the Avenue Linear Park and Park Place I and II. P a g e2 | Focus Area 1: Land Use Having the appropriate mix of uses in a commercial area is important to its success. The types of uses desirable in a given location vary depending on the intended nature of the area. The core of a downtown depends heavily on uses that attract pedestrians and relies on a high density of customers from nearby offices, residences, and entertainment activities. The Fountain Hills primary urban core area is along the Avenue, particularly from Saguaro to Verde River. This is an area that should have a predominance of restaurants, retail stores, and entertainment venues on the ground floor facing the street. Shade and outdoor activities such as sidewalk cafes and sitting areas should be readily available. Store fronts should be highly transparent to provide interest to the pedestrians on the sidewalk. Moving away from the intense core of the Avenue, the uses can become broader with a greater mix of commercial and office uses that can be less pedestrian oriented. One of the keys to a successful urban space is the energy that comes from activity that occurs consistently throughout the day and the week. Having residents in and near the area to provide activity and support for the businesses is essential. Implementation Strategies: x Improve the use and activity within the Avenue District by: o Amending ordinances to allow sidewalk cafes and developing standards for implementation. o Encouraging active front patio usage. x Amend the zoning ordinance to require active first floor uses (restaurants, retail, entertainment) along the Avenue District. x Improve maintenance of vacant properties by amending ordinances and enforcement practices for these properties. x Remove obstacles to development and encouraging the right uses in different areas by: o Reviewing practices and procedures to assist with development. o Amending ordinances to allow up to 12 dwelling units by right on upper floors o Reviewing and amend ordinances as necessary to allow a wide range of businesses on Parkview. x Improve the design quality of buildings in the Downtown through: o Developing design guidelines for the downtown. o Establishing a façade improvement program. x Explore options to work with building owners to improve the amount and quality of shade through building awnings. Focus Area 2: Infrastructure A high-quality built environment that is safe, comfortable, and attractive is important to the success of a downtown area. Through the focus groups, surveys, and open house, a consistent theme was the need for the Town to continue to improve the public space along our streets with outdoor gathering areas, room for sidewalk cafes, additional shade, and lighting. There is a strong desire for creating a place where people can gather P a g e3 | to dine, shop, and enjoy a variety of activities and walk comfortably throughout the downtown. The public right-of-way and the sidewalk system are key components of the urban fabric that provides a place for citizens to interact. Providing a consistent sidewalk system that provides connectivity throughout the downtown is critical to the long-term viability of the area. The sidewalk system needs to be free of obstructions and include ADA access to buildings and public spaces. In our environment shade is also an important part of the sidewalk system. Shade can be from trees, building awnings, or other shade structures. Given our otherwise dark skies, pedestrian oriented lighting is also important for safety. Implementation Strategies: x Implement streetscape improvements to include: o More trees and shade along the Avenue o Add sidewalks and trees along Parkview o Fill in sidewalk gaps within downtown boundary o Provide shade over gathering areas along the streets o Provide lighting at street crossings o Add festive lighting in the Avenue entertainment area x Create small, unique gathering places along the streets with shade and appropriate lighting. x Explore options to improve pedestrian connectivity between downtown and Fountain Park. x Evaluate options for improved event parking as recommended by the Downtown Parking Analysis. x Partner with Plat 208 for redevelopment of the pocket parks along the Avenue. x Coordinate with Plat 208 to improve connections from parking areas to streets within the downtown. x Determine the feasibility of installing public restrooms in the downtown area through a public- private partnership. Focus Area 3: Economic Vitality Economic vitality involves taking a proactive and collaborative approach to building and growing a diverse economic base through smart new investment, cultivating a robust ecosystem for small businesses, focusing on the unique assets of the Fountain Hills community, and fostering an environment to help build local wealth. Implementation Strategies: x Create flexible zoning uses within the Business District to attract targeted industries and new skilled talent. x Evaluate the current Entertainment District and modify to include uses such as dining, shopping and live entertainment. x Continue to collaborate with Shea-Connelly on the completion of Park Place. x Modify the Zoning Code to allow temporary uses on vacant properties. x Determine the feasibility of creating programming within the Avenue Linear Park to attract residents, visitors and businesses. x Continue small and large-scale events within the Avenue District and determine the feasibility of expanding event footprints to include other districts within the downtown. P a g e4 | x Partner with The Avenue Merchant Association (TAMA), local attractions and businesses within the downtown area to create a newsletter and schedule of events that can be promoted locally and regionally. Focus Area 4: Public Spaces/Placemaking Placemaking inspires people to collectively reimagine and reinvent public spaces as the heart of every community. Strengthening the connection between people and the places they share, placemaking refers to a collaborative process by which we can shape our public realm in order to maximize shared value. With community-based participation at its center, an effective placemaking process capitalizes on a local community's assets, inspiration, and potential, and it results in the creation of quality public spaces that contribute to people's health, happiness, and well-being. Placemaking shows people just how powerful their collective vision can be. It helps them to re-imagine everyday spaces, and to see anew the potential of parks, downtowns, waterfronts, plazas, neighborhoods, streets, markets, campuses and public buildings. During the April 2023 Economic Development workshop, the following question was asked: Placemaking inspires people to collectively reimagine and reinvent public spaces as the heart of every community. Where should Fountain Hills prioritize placemaking? Below are the results: 1. Downtown 2. Four Peaks Plaza/Target Shopping Center 3. Town Hall Campus/Centennial Circle 4. Fountain Park Implementation Strategies: Arts x Partner with the Southern Arizona Arts and Cultural Alliance (SAACA) to administer murals in strategic locations identified by the town. x Partner with Plat 208 to streamline the architectural review requirements to install exterior murals on buildings located within Plat 208. x Install murals on utility boxes located in Downtown Fountain Hills over the next six years, based on town funding. (Exhibit A). x Modify the public art policy to allow for performing and temporary art. Signage x Implement Town-wide Wayfinding Signage by December 2025. x Install entryway/monument signs within each district to identify and distinguish Fountain Hills’ downtown area. x Update the existing street banners along the Avenue District. x Provide pedestrian oriented signage to direct people to businesses. x Allow for additional temporary signage during special events. P a g e5 | Budget Implementation Plan The Downtown Strategy will be a multi-year plan that will have budgetary impacts that will include one- time and ongoing expenses. Budget priorities and implementation plans will be part of the annual budget process. Aven u e o f t h e F o u n t a i n s Ve r d e R i v e r D r Palis a d e s B l v d Sa g u a r o B l v d Park v i e w A v e La M o n t a n a D r Paul N o r d i n P k w y P a n o r a m a D r El La g o B l v d Districts District Strategy Business District The Avenue District South End District Civic District Saguaro Frontage Sidewalk Downtown Center Map Revised: November 14, 2023 El Lago B l v d Fountain Lake Proposed Downtown Supplements Proposed Downtown Supplements–Downtown Fund (Ongoing Supplements) Downtown Fund FY26 FY27 FY28 FY29 FY30 Event Programming $20,000 $20,000 $20,000 $20,000 $20,000 Marketing $20,000 $20,000 $20,000 $20,000 $20,000 Banners $15,000 $15,000 $15,000 $15,000 $15,000 Murals $25,000 $25,000 $25,000 $25,000 $25,000 Façade Improvement Program $50,000 $50,000 $50,000 $50,000 $50,000 Palm/Tree Lights $20,000 $20,000 $20,000 $20,000 $20,000 Maintenance & Repair $5,000 $5,000 $5,000 $5,000 $5,000 Total (12/5/24):$150,000 $150,000 $150,000 $150,000 $150,000 Total (2/25/25):$75,000 $75,000 $75,000 $75,000 $75,000 Questions? ITEM 7. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Administration Prepared by: Paul Soldinger, Chief Financial Officer Staff Contact Information: Paul Soldinger, Chief Financial Officer Request to Town Council Retreat (Agenda Language): Review of the Town's Special Taxing Districts. Staff Summary (Background) Staff will discuss both of the Town's Special Taxing Districts, including the following items: Cottonwoods Maintenance District: Background Continuing Tax Levy Options for Continuing or Closing the District in accordance with A.R.S. §48-724. Eagle Mountain Community Facilities District: Background Update on Qasimyar Property Tax Issue Possible Direction from Mayor & Council on Addressing the Issue Options for Continuing or Closing the District in accordance with A.R.S. §48-724. Attachments Special Taxing Districts Form Review Inbox Reviewed By Date Town Attorney Aaron D. Arnson 02/11/2025 11:17 AM Town Manager Kandace French Contreras 02/11/2025 02:08 PM Kandace French Contreras 02/11/2025 02:08 PM Stop has been removed Kandace French Contreras 02/11/2025 02:08 PM Kandace French Contreras 02/18/2025 05:04 PM Town Manager Form Started By: Paul Soldinger Started On: 02/11/2025 10:54 AM Special Taxing Districts Paul Soldinger, Chief Financial Officer February 25, 2025 Background and Future Options Special Taxing Districts •The Town has 2 affiliated special taxing districts •Eagle Mountain Community Facilities District (EMCFD) •Cottonwoods Maintenance District (CMD) •Both are legally separate from Town, but both Boards are comprised of the full Mayor & Council •Because Mayor & Council control the districts in Board roles, both districts are considered component units of the Town and included in the financial reporting of the Town Legally Separate Financial Reporting - Explained Legally Separate Cottonwoods Maintenance District (CMD) •Established by Council in 1998 and issued bonds for community improvements, which were paid off around 2009 •The CMD Board (same members as Council) levies secondary property taxes on parcels within the district for maintenance purposes each year •Levy is based on budgeted expenditures to complete the annual maintenance (landscaping, painting, etc) •FY2025 Tax levy •$180.37 per property owner •58 parcels in district Special Taxing District #1 Eagle Mountain Community Facilities District (EMCFD) •Established by Council in 1996 to issue 2 bonds to build the following projects in Eagle Mountain community: •Sewer project •Stormwater conveyance system •Parkway Phase 1 project •Summer Hill Blvd project •2 additional bonds were issued to refund the outstanding debt at lower interest rates until paid off about 5 years ago. •No current outstanding debt à No secondary tax levies upon the Eagle Mountain community residents Special Taxing District #2 Qasimyar v. Maricopa County •2016 lawsuit against Maricopa County •Affirmed by appeals court in 2021 •Changing a property from owner-occupied residential to rental/secondary home should have required re-assessment •Re-assessments could have resulted in different assessed values •State law was modified in 2023 •No re-assessments would be required under new law Refresher Information Eagle Mountain - Qasimyar •Maricopa County previously may have considered Eagle Mountain CFD to be a “disadvantaged district” •“disadvantaged district” à no longer has taxing authority to levy property taxes on community residents for improvements à no remaining funds to pay off Qasimyar liability •Maricopa County has since refined criteria and may not consider Eagle Mountain CFD to be “disadvantaged district” •Eagle Mountain CFD Qasimyar liability - $45,401 •Includes about $10,598 of interest Qasimyar Liability Options for Closure •Special taxing district boards are able to dissolve a district through the following actions (ARS 48-274): •The District may be dissolved by the district board by resolution if: •All of the property owned by the district has been or will be conveyed to the municipality, county or school district •Either the district has no obligations or the municipality or county has assumed all of the obligations of the district •(Town would assume Eagle Mountain Qasimyar liability if not addressed) •And, if the dissolution has been approved through an election of the residents, OR, the boards have determined that the district has been inactive for at least 5 years and serves no future purpose Future Considerations Eagle Mountain Qasimyar Options •Option #1 – Town could consider paying off the liability •Option #2 – Town/Board could take no further action at this time •Option #3 – Town/Board could consider joining class- action lawsuit (only for interest portion of $10k) •Option #4 – Board could consider pursuing GO bond issuance under remaining taxing authority – would have associated issuance costs and levy a secondary property tax on the community residents Council Direction Requested ITEM 8. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Presentations Submitting Department: Fire Department Prepared by: Dave Ott, Fire Chief Staff Contact Information: Dave Ott, Fire Chief Request to Town Council Retreat (Agenda Language): Review of proposed membership in the Regional Automatic Aid (AA) System for Fountain Hills Fire Services. Staff Summary (Background) rRegional Automatic Aid is an available option for the Fountain Hills Fire Department now that we are a municipal fire department and no longer a private company. Attachments Automatic Aid Presentation Form Review Inbox Reviewed By Date Clerk Form Started By: Dave Ott Started On: 02/12/2025 02:04 PM Automatic Aid System THE REGIONAL SYSTEM TO PROVIDE THE MOST EFFICIENT, SAFE, AND EFFECTIVE FIRE-RESCUE- EMERGENCY MEDICAL SERVICES TO THEIR RESPECTIVE COMMUNITIES HAS BEEN IN EXISTENCE SINCE 1976. THE TOWN WILL BENEFIT FROM MEMBERSHIP IN THE SYSTEM AND WOULD LIKE TO APPLY TO BE A PARTICIPANT. The Automatic Aid System provides dispatching of the closest, most appropriate unit regardless of jurisdiction in conjunction with the most effective use of local fire department resources working collaboratively through intergovernmental cooperation. •The Fire Department’s baseline salary and benefit amount for FY2026 is about $4,475,000. •Promoting 3 Battalion Chiefs and the subsequent back fill promotions would add about $220,000, for a total of about $4,695,000. •Promoting 3 BSOs and the subsequent back fill promotion would add about $115,000, for a total of about $4,810,000. •Costs phased in over two years. The Town will benefit by units automatically added to incidents as needed. The current Mutual Aid system requires the MRDC to ask neighboring jurisdictions to send units if available. Specialty Units, Haz Mat, Technical Rescue (TRT) and Support Units will be automatically dispatched to the closest available units. It expands the capabilities of the FHFD from two fire units to available units from the 23 other jurisdictions that are currently members of the AA System. ITEM 9. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 02/25/2025 Meeting Type: Town Council Retreat Agenda Type: Regular Agenda Submitting Department: Administration Prepared by: Kandace French Contreras, Town Clerk Staff Contact Information: Kandace French Contreras, Town Clerk Request to Town Council Retreat (Agenda Language): Review of Council's supplemental requests and directions to staff. Staff Summary (Background) Additional items or direction to staff as the Council deems necessary. Form Review Inbox Reviewed By Date Town Attorney Aaron D. Arnson 02/19/2025 02:18 PM Interim Town Manager Town Attorney Town Manager Form Started By: Kandace French Contreras Started On: 02/19/2025 12:06 PM