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HomeMy WebLinkAbout2025.0902.TCRS.VERBATIM.TRANSCRIPT.APPROVEDTOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 1 of 115 Post-Production File Town of Fountain Hills Town Council Meeting Minutes September 2, 2025 Transcription Provided By: eScribers, LLC ** ** * Transcription is provided in order to facilitate communication accessibility and may not be a totally verbatim record of the proceedings. ** ** * TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 2 of 115 MAYOR FRIEDEL: I'd like to call this meeting to order. And would you please rise for the Pledge of Allegiance? IN UNISON: I pledge allegiance to the flag of the United States of America, and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. MAYOR FRIEDEL: And if you choose, please remain standing, because our invocation tonight will be given by Harold Javid from Baha'is in Fountain Hills. JAVID: Oh, my God. Oh , my God. Verily, I invoke thee and supplicate before thy threshold, asking thee that all thy mercies may descend upon these souls. Specialize them for thy favor and thy truth. Oh Lord, unite and bind together the hearts. Join in accord all the souls, and accelerate the spirits through the signs of thy sanctity and oneness. Oh Lord, make these faces radiant through the light of thy oneness. Strengthen the loins of thy servants in the service of thy kingdom. Oh Lord, thou possessor of infinite mercy, Oh Lord, of forgiveness and pardon, forgive our sins, pardon our shortcomings, and cause us to turn to the kingdom of thy clemency, invoking the kingdom of might and power, humble at thy shrine, and submissive before the glory of thine evidences. Oh Lord God, make us as waves of the sea, as flowers of the garden, united, agreed through the bounties of thy love. Oh Lord, dilate the breast through the signs of thy oneness, and make all mankind as stars, shining from the same height of glory as perfect fruits growing upon thy tree of life. Verily thou art the Almighty, the self-subsistent, the giver, the forgiving, the pardoner, the omniscient, the one creator. MAYOR FRIEDEL: Thank you. Town Clerk, would you please take roll call? TOWN CLERK: Mayor Friedel? MAYOR FRIEDEL: Present. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Here. TOWN CLERK: Councilmember Earle? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 3 of 115 EARLE: Here. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Here. TOWN CLERK: Councilmember Watts? WATTS: Here. TOWN CLERK: Councilmember Larrabee? LARRABEE: Here. TOWN CLERK: Councilmember McMahon? MCMAHON: Here. TOWN CLERK: Mayor, you have a quorum. MAYOR FRIEDEL: Thank you. And there's been one slight change now. Our statement of participation is on the screen there, so we will no longer be reading that so everybody can see that on the screen. And now, we'll start with our reports by mayor, councilmembers, and town manager. Rachael? GOODWIN: Thank you, Mayor. Everybody, welcome back. It's been a very long, busy summer, but we're here back again. I'm not going to take much time for a report, other than it has been a very active summer. We've taken on a number of projects, putting to bed the previous budget, kicking off the new budget. Getting a start on our different CIPs. This summer has been very, very busy. So we are hitting the ground, rolling and ready to resume our council meetings. MAYOR FRIEDEL: Thank you. Councilwoman Earle? EARLE: Yes. I just wanted to say it was a nice little break, although I know -- I do appreciate Rachael answering my phone calls every week, many times. She's very available. I do also want to thank Director Weldy for his street department and staff that did the improvements in the driveway at the Shea and Four Peaks Plaza. Thank you very much. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 4 of 115 Also, that you quickly took care of that streetlight that was hanging on Shea within a couple hours. I called in that there was a light hanging, and it was fixed really fast, so I appreciate that. I also want to thank our community relations director, Mike Pelton, for doing an excellent job. And it was nice seeing him when I was at the League of Arizona Cities and Towns Conference, and it was nice spending time with other councilmembers there as well. Thank you. MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Thank you, Mr. Mayor. Good evening, everybody. Thank you for coming, as always. Live streaming on Cox, YouTube, and here, of course, in person. Engaged citizenship is essential for good governance. Participation is critical to good community, good governance, and people getting along. So thanks, all, for coming. Yeah, there's so many things that we did over the summer. I'm just going to keep it real brief for tonight. But yeah, I attended the League of Arizona Cities and Towns Conference. This was the third year in a row, and it is just a wonderful experience to meet with the mayors, the council people, the state reps, state senators, managers, and the staffs of so many towns around Arizona. And we learn, we ask questions, we ask them how do you do this? How do you do that? It's just a wealth of information. And it's so good for our council, most of which went there, and we all got a chance to participate in something that was very worthy. My other highlight of the summer was a couple weeks ago on their opening day for the Inspiration Academy, I got to address the middle school and the high schoolers. They asked me to talk about my journey on the council and in politics. It was just wonderful being with these children. They're optimistic, bright-eyed, eager to learn. I was scheduled to be there at half an hour, and I'm sometimes long winded, but they were asking so many questions it was over an hour long. And they were asking really great questions about how to get involved, and what do we do, and how did you do it? And so you know, all I can say is as we get older and set off to retirement, we have a really TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 5 of 115 good bench in our high schools and our schools. Lastly, I'd like to talk to everybody about an event that's going to be happening in Tempe. It's the Tempe Town Lakes 9/11 Healing Fields freedom concert. It's a wonderful thing. I used to do that with the United States Coast Guard Auxiliary band, and this year, I'll be playing with the Desert Valley Winds band. For those who want to be a part of it, they will have the stand up flag ceremony with 3,000 flags will be displayed. That will be on 9/11 itself, and they're looking for volunteers. So if you want to volunteer to put up flags, they're looking for that. The Freedom Concert will be Saturday, September 13th. The program is from 6:30 to 8:30, and it's just filled with patriotic music, speeches, veterans speaking. And it's something that if you haven't done before, you should try to be there. The media will be there, radio stations. It's huge. And it's a remembrance of those who fell on that day, and we should never forget. And so that's my report. Thank you, Mr. Mayor. MAYOR FRIEDEL: Councilman Watts? WATTS: Reiterate the same thing. It was a nice break just to get away, but I'll also support what Rachael has to say. It never ends, and so we all got tasked during the course of that event. Attended the league a League of Cities and Towns. Very informative, very insightful as to the number of people we met and some of the opportunities we were able to explore. And also, had a ride along with MCSO, which I found very insightful. That's it. MAYOR FRIEDEL: Thank you. Councilman Skillicorn? SKILLICORN: Thank you, Mr. Mayor. And actually, I want to do a shout out to you. So a few days ago, there was one of the tabloid newspapers kind of defamed Fountain Hills with an image, you know, basically insinuating that there -- that our town was unsafe and there was crime here. And lo and behold, they changed that article, and I was told that was on behest of your call. So thank you for sticking up for Fountain Hills, and thank you for, you know, getting that tabloid paper to change that photo. I appreciate it. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 6 of 115 MAYOR FRIEDEL: And to be accurate, it's actually the town staff that took care of that. So we appreciate the town staff, but we were all -- SKILLICORN: So thank you, staff. MAYOR FRIEDEL: -- all alerted. Yeah. Councilwoman? MCMAHON: Thank you. Good evening, everybody. Thank you for coming tonight. I hope all of you had a great summer. Like everybody said, so far it has been an awesome summer break. Even though many of us were pretty busy, I did attend a few board meetings, and committee meetings, and I was also able to attend the Arizona League of Cities and Towns annual conference, and it was really amazing. It is always nice to see our colleagues and learn about what other towns and cities are doing throughout the State and attend some of their very, very informative workshops that are on point with a lot of things that we will be dealing with in the future here. So that's about all I have to say. Thank you. MAYOR FRIEDEL: Thank you. Councilwoman? LARRABEE: Thank you, Mayor. Like many others up here, I was at the LACT Conference, and it was a very informative time. I really enjoyed getting to have -- this was my favorite part -- getting to have lunch with our Mayor's Youth Council. They are so involved and just -- they want to know everything about town council. It is really exciting to see the youth of our town be excited about town council, because you don't see that as something that's a pull for kids, right? So it was very wonderful. Besides that, over the summer, like everyone else, I took meetings. It was a busy summer, and we're glad to be back. MAYOR FRIEDEL: Thank you. And like the rest of you, I attended the League of Cities and Towns, and I have to say that what I learned was a lot of towns have the same issues, and they're trying to deal with the same things that we are here in Fountain Hills, from short-term rentals, to road work, to securing their towns with police work and that kind of thing. So we're not alone. We have some of the same issues. Some of the same TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 7 of 115 challenges as other towns do. Councilmember Watts and I actually had some good connections with a vendor that does financing. So we're exploring some options that might be able to help our town down the road. So that was -- it was really a good session, and we met a lot of good contacts there. We also had a lot of capital projects that were done or started this summer. A lot of road work was completed, sidewalk infill, and other things around the town. Work continues up at the Golden Eagle drainage project, and I think we'll hear something about that tonight as well. But we've got a lot of stuff going on, a lot of positive things happening in this town. So we're fortunate that we have a good staff that stays on top of all these things for us. We also got contact -- I got contacted by some of the top brass at Sprouts, and we had a very good conversation and meeting with those people. They're going to be very involved with our town. They wanted to know all the events that we do, different charitable options, and that kind of thing too. So they're going to come in here, and they're going to really be a part of our community. So we're really looking forward to that. So it's not going to just be a grocery store, they're going to be really involved with what we do in this town. So that was really a good meeting, and we learned a lot about them, and they learned a lot about us as well. So we're happy that that meeting came to play. One last thing I'll mention is that the next coffee with the mayor is going to be Wednesday, September 17th at 9 o'clock at the new Euro Pizza. If you're in town, you have questions, comments, come on out. It's pretty much a friendly conversation and good questions, and we give updates on what's going on around our town. So every resident is invited to that. And with that, that's the end of our report. So thank you. So now, we'll move on to probably one of the greatest things that that we can do, and that's the mayor's citizen's award. This award is not something that we give out all the time. We give it out when there's a special accomplishment to deserving residents in TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 8 of 115 our town. So tonight, I'm pleased to read a little paragraph. I'm presenting this award tonight to Konlin and Julie Jones with gratitude and recognition for extraordinary community service. In the face of overwhelming challenges, true character is revealed. And in this case, generosity, compassion, and the spirit of community shone brightly. This Mayor's Citizens Award is presented to Konlin Jones and Julie Jones in heartfelt recognition of their selfless act of kindness toward fellow Fountain Hills residents during a time of great personal hardship. Upon learning of a local couple's ongoing battle with cancer and the financial strain of medical treatments, Konlin and Julie stepped in to provide a much needed install of air conditioning system, entirely free of charge for these residents. This extraordinary gesture was offered not for praise or publicity, but purely out of care, empathy, and a deep commitment to the values of their company. That's what makes Fountain Hills a community. This is not how we should be, it's how we are. This community gives a lot back to a lot of people. We have a lot of volunteers, and great volunteers, and great citizens in this town. So with that, I'd like to have you come up, both of you, receive this award, and maybe say a couple things. J. JONES: Thank you. So since I'm the talker of the family, I'll start first. We are truly honored and humbled to receive this award. I have been a resident of this community for 24 years, and my late husband, Mike Jones (ph.), was probably close to 30. He loved -- we both loved this community, and it really is an honor to serve the people in this community because it all starts with us together. You know, that one small ripple effect makes a difference for everyone. So I -- I'm really at a loss of words when I found out that we were receiving this award. I know my husband is looking down on us, and he is so proud of everything that we continue to do with this company. Believe it or not, he's been gone now 16 months, and we just keep moving forward like he would have wanted us to move forward. So thank you, again, for this honor. K. JONES: Hi, my name's Konlin Jones. I just want to tell you guys that this is a lovely community. We're going to stick around here to try to help whoever we can out. If TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 9 of 115 you're in need, always give us a call. We can't do it without my great staff that's able to actually stay here, show up, do what needs to get done, do it the right way. And as well, other members of our community are always here watching each other's back, who really keep the gears turning for everybody to be able to help each other out, and that's what we have to do. Thank you. MAYOR FRIEDEL: Okay. Now, we'll move on to some presentations. Rachael? GOODWIN: Actually, Mayor, I think we have one more proclamation to observe. MAYOR FRIEDEL: Oh, you're right. I'm sorry. We have a proclamation, and that will be Councilwoman Hannah Toth. LARRABEE: Our proclamation is to declare this month Ovarian Cancer Awareness Month. Whereas ovarian cancer is the fifth leading cause of cancer related death among women with no reliable early detection test and most cases diagnosed at late stages, the town of Fountain Hills joins survivors, families, caregivers, and health care professionals in raising awareness, promoting education, and fostering hope for earlier diagnoses, improved treatments, and ultimately, a cure. Now, therefore, September 2025 is proclaimed Ovarian Cancer Awareness Month in the Town of Fountain Hills, Arizona. The great fountain will be lit teal, and all residents are encouraged to participate in awareness activities, wear teal, and engage in conversations that help save lives and support those affected. Do we have someone here? Yes. There you are in teal. I love it. I tried. I got my -- I got my water bottle. That's all I had. (Pause) MAYOR FRIEDEL: Okay. Now we'll move on to presentations. Rachael? GOODWIN: That's right, yes. First up tonight, we have director Justin Weldy. He's going to be doing a review of our public works and the accomplishments through the FY25 budget year. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 10 of 115 Director? Looks like he's still looking for his presentation. So in the meantime, I'm going to highlight how much work our public works crew does. They're often sort of our unsung heroes are out there -- I'll give you the example of this morning cleaning up from our storm last night. I had rain in my corner of town. I know other people did not, but we had quite a bit of rain, quite a bit of wind, a lot of downed limbs, things like that. So they're the guys that make sure the streets are picked up and ready to go. They're the -- when we have reports, they respond immediately. I know, Mayor, you and I have had some exchanges about things. So our Public Works staff do quite a bit sort of off the radar. So we appreciate that. Justin, I'm trying to buy you time here. There we go. WELDY: Good evening, and welcome back from the short summer break. We hope everybody had an opportunity to enjoy themselves and get around and see a few things. While that was happening, we continued to work away at the items that are listed in our budgets and primarily capital projects. I'm going to give a brief opening statement, and then I'm going to move through the slides in the interest of tonight's large agenda. Please note, while you see me up here on a regular basis talking about capital projects and maintenance and improvements to this community, none of it would be possible without the residents, the elected body, management, and the town staff that support all of these endeavors and help them to come to fruition. So if you see anything in particular as I'm moving through here that you would like to discuss, please let me know. We'll stop and spend a few moments on that. Again, this is our capital projects. For those of you not familiar, the fiscal year was 25, which started on July 1st, 2024, and ended on June 30th, 2025. This is a relatively large one. This was a grant project to infill sidewalks on Saguaro from Messenger and/or Colony all the way to Fountain Hills Boulevard, and also fill the gaps on the north side of Palisades between Saguaro and Fountain Hills Boulevard. You can see there are some of the numbers. If you have any questions about those as we move forward, just let me know. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 11 of 115 This is a multi-year project. This is sidewalk infill, which is separate from the grant project and gap elimination. For this one, we completed a section in the very beginning of last fiscal year up on Eagle Mountain, and then we started the project on Bashas' during last fiscal year and finished the last little bit this month. For those of you that have not had an opportunity, please take one and take a look at the gap elimination on La Montana between the Avenue of the Fountains and Palisades; quite beneficial and already being used. This is another multi-year project. For this year in anticipation of the Maricopa County Department of Transportation's rehabilitation project for McDowell Mountain Road from milepost two to Forest Road, we came in and did our portion of the guardrail. It was below the minimum height, and would have left an unusual tangent in that location. We took advantage of the opportunity and funding from the mayor and council, started it in 2025, and did the last little piece of it; a few thousand dollars' worth in 2026. These ones right here have been generating a considerable amount of discussion within the town. This was a capital project approved by the mayor and council through the Citizen Advisory Committee some time back. These are just a few of the locations that were completed last year. We continue to work forward and mark additional locations. The majority of the comments have been positive. The exception is one well-respected engineer that is retired that stated as a result of all of these, he now has to slow down and pay attention. This is some of our multi-year storm water infrastructure. This is a location down on Wendover that feeds into Ashbrook wash. On the -- well, let's start on the top. So on the top left is actually a location down on West Ridge where a couple of storm events had begun to erode and cause some failure under and behind this scupper. So we went in and removed it and replaced it with a -- losing track of where I'm at just briefly -- with that storm structure that you see there to convey water. The bottom left is actually on Wendover. So on Wendover, that grate was put in there many, many years ago in an attempt to minimize flooding, primarily to the house on the right-hand side. During and TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 12 of 115 after storm events, that house was often inundated with water. We came up with a new design put in this drainage channel to convey that water away, and we are confident that we will have a substantial improvement and minimize, if not eliminate, that back watering. This is the Shea Boulevard project. As a reminder, this project has been going on since the County gifted Shea to the town of Fountain Hills right after incorporation. This is the section that is eastbound between Palisades and Fountain Hills Boulevard. The design is completed. The project will be released for bid on September 11th. This is another multi-year project. It started with a grant for the first phase of it, which was on Grande Rosita. During that phase, we discovered some other deficiencies. We went ahead and did the project while we were waiting for the grant, and right at the end of the project, we're notified that we would be receiving a grant, which will be a reimbursement for the project. Those grant monies will go back into the Capital Improvement Project Fund and be available for outlying years. This is the long-anticipated wayfinding started in 2025 in regards to manufacturing and installation. They have installed the majority of the signs. The exception to that are the V15s in and around the downtown area. That will start in the coming days. This is the long-anticipated substantial completion of the Golden Eagle impoundment. Golden Eagle Park is in an impoundment area which is controlled by a dam, and the purpose of that dam is to minimize or eliminate downstream loss of life and/or property damage. We reached substantial completion right after the fiscal year ended and the new year started. We have a couple of minor things that we're doing in there right now, and we'll have a discussion about that later on tonight. This is a council approved project, the downtown streetscape. This is Parkview and Verde River. This is a MAG grant that gets us to the 15 percent design concept. We're well underway there, and we'll be having some public meetings to discuss that this fiscal year. This is just a quick review of our paving projects. We had about $5 million, a little bit more than five million, and we spent 4.9. These are the areas that were completed. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 13 of 115 This would be in the northwest quadrant of town. This is in that same general area. This is Gunsight. As a reminder, we came to council because not all of Gunsight was selected and asked to defer some other locations so we could complete a super segment there. This is another part up off of Palisades and Palomino. This is a section of Trevino. This is a little bit of Nicklaus and Palmer way. This is El Lago. This was a council directive project. That was the street department. Now let's get on to some of the exciting stuff. MAYOR FRIEDEL: Justin -- WELDY: As you can -- MAYOR FRIEDEL: -- before you move on, can I ask a question, please? WELDY: Yes, sir. MAYOR FRIEDEL: On slide 9, you've got two of those culverts that are draining into a backyard that looks like it's obstructed. Is there a retention area? You see the one that you've got in orange and the one to the left where it drains into that same backyard, and then it abuts a masonry wall on two neighbors down below. Did we look at the ability of that retention basin to hold that amount of water that we anticipate? WELDY: Mr. Mayor, councilmember. So the entire area drains through a pipe that runs between those two houses, and then it enters a pipe into the next area down below, and then it actually drains on out into the street. There is no retention in involved. All of the water is a throughput and flows out onto the street and then into Balboa wash. MAYOR FRIEDEL: So it's just a momentary catch basin, so to speak, and then it drains out through that pipe? WELDY: Series of pipes. Catch basin -- MAYOR FRIEDEL: Gotcha. WELDY: -- and pipes and headwalls. MAYOR FRIEDEL: And then on the next slide, 10, the wayfinding sign, I've had complaints about the sign that's just south of Kingstree and Saguaro. When you look to the south going east on Kingstree, that curve seems to obstruct view. Have you heard anything about that one? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 14 of 115 WELDY: Mr. Mayor, councilmember, we have received several comments in regarding the wayfinding signs. As we progress here, we're going to look and verify and/or make corrections where necessary on each of these concerns. MAYOR FRIEDEL: Thank you. My wife would be very happy, then. WELDY: As you can see, the street department stays busy year-round, but there's not a substantial change from FY24 to 25. Approximately, 200 signs were repaired or replaced for obvious reasons. Over the summer, or at the beginning of the summer, we were able to utilize funding to seal not only the sheriff's office parking lot, but the shared parking lot with Park Place, the east parking lot of Fountain Park off of Panorama, and also the Botanical Garden on Fountain Hills Boulevard. This is an intersection improvement at Saguaro and Palisades. That was the only signalized intersection within the town that did not have a protected left turn for each of the left turning movements. It now does. As always, we have been doing an incredible amount of pothole repair all over town. Some of the most recent visible ones would be on Fountain Hills Boulevard between Palisades and McDowell Mountain Road. We continually evaluate all of our walking surfaces, and we address any uneven walking surfaces. The first one is identify, mark, grind, catalog, and then replace. We most recently in FY26, replaced several panels up Golden Eagle Boulevard, north of Palisades. On average, we receive about 15 calls for service after Town Hall closes over the night and on weekends. This is an example of one of our traffic signals that were damaged. More often than not, it's a vehicle into the median and into either trees or a large saguaro. This is our facilities maintenance staff and some of the calls that they had and their calls for maintenance and/or general already programed. Onto the environmental programs. As you can see, a considerable amount of material is collected and recycled and/or properly disposed of. This is the second one. This is the electronics recycling one. For multiple years now, the street department has a TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 15 of 115 dumpster where metals that are being discarded -- some of it town generated, but the majority of it a result of dumping in alleyways and washes, we pick that stuff up and we put it in these dumpsters and we dispose of it for a fee. There is an exception here, and I want to make this clear. For all of our signs, which are made with sheet aluminum, we store those separately, we contact the recycling facility whenever we have a large shipment, and we work to get to the best market price. And when the market price is good, we deliver the materials, and it's obviously paid for, and that funding then comes back to the street department and the signs. Wash maintenance. Very exciting. Here is our map of all of our washes and dams. We can blow that up in the future, if you'd like. We did give a presentation as part of our closeout when we were asking for additional funding and an amendment. There wasn't any substantial change after that. So we're just under 50 acres is what we completed last year. And depending on tonight's discussion later on in this meeting, we will begin to proceed again very shortly. As quickly as I could. Any questions? Thank you for the opportunity. MAYOR FRIEDEL: Rachael? WELDY: All warmed up. GOODWIN: All right. Moving on to our next presentation. Just as lively and exciting as Public Works is our budget update. Paul's going to talk about our fourth quarter fiscal year revenue update to kind of close out the year and give some options for council discussion. SOLDINGER: Oh, give me a minute. All right. Good evening. Welcome back. Mayor, vice mayor, and council. Tonight, I will be presenting the town's fiscal year 2025 full year and quarter four revenue update. I'll be focusing on local sales tax revenues and state shared revenues for the presentation. One thing to note before we get into it is we talked a lot about the economic ups and downs. Our sales tax revenues have fluctuated this past year. We did end the year pretty strong. We had a good June. We brought in a lot of construction sales tax revenue, so that kind of buoyed our results. But the headwinds still remain. I just want TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 16 of 115 to emphasize that. Every time we talk, we have a process in place to track our revenues, present them to mayor and council, let you know how things are looking. And we have policies and procedures in place to ensure that we're tracking them accordingly and making appropriate decisions and advising you accordingly. So with that, for the fourth quarter, we brought -- well, the total net taxable activity for the town was $185.4 million, a decrease of almost $9 million. For the full year, the total net taxable activity was $711 million. It's about three percent less than fiscal year 2024. A lot of that, or at least at least part of that, has to do with the loss of the long-term residential rental taxes that went away last year. That's going to be a portion of that. And as we get into the results, you'll kind of see, yes, it lowered, but as far as our sales tax revenues go, they're pretty much stable or flattened from the prior year. We're not seeing a large growth kind of a consistent revenue collection compared to the prior year fiscal 2024, other than that long term residential rental tax that we did lose. For total TPT, total local sales tax collections for the year while starting with the quarter, fourth quarter, we brought in $5.4 million, just slightly more than the same quarter in fiscal year 2024. And in total, we brought in $20.2 million as a town for the entire fiscal year. That's a reduction of about 1.8 percent from the prior year. But that $370,000 or so of lower sales tax collections for the year, that can almost entirely be attributed to the loss of the long term residential rental tax. It's pretty close to that amount. So again, I'm just trying to paint this picture where the town is pretty flat in our revenue collections at this point, and that's kind of consistent with what we've discussed with the fiscal year 2026 revenue projections staying relatively flat as well. I added some things to this presentation just to kind of emphasize where we are compared to our projections. Like we talk about, we have a conservative projection methodology. We do this intentionally to protect the town, protect the staff, and be able to provide services to our residents. So if you see on the right, we brought in the $20.2 million compared to the 17.6 million projected. That's still almost 15 percent more than we projected last year. So again, well above our projections, we're still in a good place, but yes, things are slowing down. Definitely keep that in mind. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 17 of 115 One thing to note also for fiscal year 2026, we just slightly increased our total projection by about two and a half percent up to a little bit over $18 million as a whole for the town. Retail sales. Kind of similar. A little bit -- a little bit different, though. We are seeing a slight decrease in our retail sales. We brought in $2.7 million in the fourth quarter of fiscal year 2025, slightly less, about three percent less than the same quarter of the prior year. In total, our local sales tax revenues for retail sales did go down by almost one percent. Again, kind of paint this picture where there are some categories where yes, we're exceeding or outperforming our projections and our prior year collections. But really, our biggest category are retail sales, our most important category, which makes up more than half of these revenues, is slightly going down at this point. And again, on the right, you'll see that it still exceed our projections by about three-and-a-half percent for the fiscal year, and we just slightly increased this category in our fiscal year 2026 projections by about .1 percent. So we're -- all I want to say there is. Just like we've discussed, we're taking into consideration that there could be a possible slowdown this year. And if there is, hopefully we'll be well prepared for that. Retail sales without food sales. It's the same data but taking out the food sales. I've been doing this for the past year. It's just a good indicator of local shopping trends, but taking out necessities like food. And so in that case, pretty similar results. You actually see a slight increase. It's kind of interesting. We see that in the fourth quarter of fiscal year 2025 we brought in almost the same exact amount of revenue as the same quarter the prior year. It's, like, within a few hundred dollars, which is unusual. So it's kind of cool in a way. But for the full year, we brought in 8.52 million, just about $10,000 more than the prior year. So again, flattening of revenue's not a significant increase like we have kind of seen the past few years before this. Now, retail sales. Within that retail sales category, we have remote sellers. It's kind of beneficial to show this just because this is one category within our retail sales that is buoying it. People are buying their goods online a lot more with the advent of all these online retailers and the Wayfair changes in rules several years ago. So we did bring in TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 18 of 115 $465,000 in the fourth quarter of fiscal year 25, about eight percent more than the same quarter of the prior year. But in total, we brought in $1.85 million, which is almost seven percent more than the prior year. So within the retail category, this is buoying it up a little bit. Without this, it would probably be going down a little bit more. Construction sales tax. Now, this category and services, which I'll discuss later, construction sales taxes -- it fluctuates. It's dependent on the development within the town. Year to year, it's going to fluctuate quite a bit, and actually results in an extra conservative projection methodology just because of the wide range of outcomes. So here, we did have a very strong fourth quarter. As you can see, we brought in 1.05 million in the fourth quarter, which was that kind of end of the year surge for us, which was 34 percent higher than the same quarter in the prior year. In total, we did bring in close to $3 million, which is still seven percent below the prior year. But again, I've kind of discussed this at a few presentations, we've kind of had this three-year trend now of higher construction sales tax revenues compared to a baseline prior to that where this seems to be more a baselined, depending on the development within the town, of course. Again, our projection was extra conservative in this category, and we well exceeded those projections by 64 percent. And we did kind of loosen the reins a little bit in this category by increasing the projection by 31 percent at 2.4 million for fiscal year 26. That's still well below the actual revenues we've brought in the past three years. So there is a lot of thought. I just want to emphasize there's a lot of thought that goes into this process, and we're doing the best we can to protect the town in case of an economic downturn. Utilities and communications. This is our most stable category, really. Every year, year over year, it kind of fluctuates quarter to quarter. But as you can see, we brought in $350,000, slightly less than the same quarter of the prior year. But in total, we brought in 1.72 million, an increase of about four percent over fiscal year 2024. Again, our revenues exceed our projections by seven percent, and our projection for fiscal year 2026 was increased by about five percent. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 19 of 115 Real estate. This is the category where we all expected it to drop quite a bit substantially because the State enacted changes to get rid of long-term residential rental sales taxes. So any residents that's rented for 30 days or more, that's no longer a taxable activity as of January of this year. So as you can see, that precipitous drop in the graph, we did take that into consideration, though, in our projections. So we brought in $156,000 for the fourth quarter of fiscal year 25, which was a large decrease, of course, to fiscal 24, and 970,000 is what we brought in for the entire year, about 28 percent less than the prior year. But as you can see, the good news is we brought in five percent more than our projections on the right. And because of next year -- well, fiscal year 26, the year we're in now, this is the first year where we'll have no long-term residential rental taxes, and that's our new baseline going forward. We did reduce our projections all the way down to 681,000, a reduction of 26 percent. Restaurants and bars. This is one category that we have continually see trending down the last three years. Actually, after 2020, and the pandemic, and things like that where there were closures and stuff, we saw kind of an increase when things started opening back up in 2021. 2022, people started going out to restaurants again. Now, we're starting to see a trend where it's dropping. So we brought in about $400,000 in the fourth quarter of fiscal year 25 and 1.4 million in total for the year, which was about three percent less than the prior year. We did bring in just slightly above our projections, two percent more than our projections, but because of the downward trend, you'll see that our projections decreased by about five percent for fiscal year 26. And hopefully, we see that trend start going back up here soon. Definitely excited about the new restaurant openings in town and things like that. Definitely support your local restaurants, everybody watching. It's definitely important to our town, local economy. Services. Just like construction, this is one of those categories that kind of wildly fluctuates. Actually, the last three years it's been relatively consistent, though. It's kind of on an upward trend, and it's really, probably, our biggest outperforming category. Well, it's our biggest outperforming category other than construction sales taxes. This TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 20 of 115 category is kind of your leisure type, tourism type activities. Going golfing, coming to the town, staying at a hotel, short-term rentals, and things like that. So we did bring in 754,000 for the quarter. A little bit less than the prior year quarter, but we brought in 2.47 million in total for the year, which was an increase of almost 12 percent year over year. So as you can see, because of the fluctuating revenues and the wide range of outcomes, we have a very conservative projection of 1.6 million. Compared to that, we outperformed it by 53 percent in the fiscal year. And we still kept that conservative approach at the 1.69 million or five percent higher for fiscal year 2026. With that, any questions on local sales tax collections? No? All right. And just real quick, state shared revenues. They pretty consistently come in with our projections. We use the Arizona League projections for to base these projections on. We use our own kind of methodology to kind of double check that. We brought in 940,000 for the fourth quarter, compared to $907,000 of state shared sales taxes. State shared revenues for income taxes, it's also called urban revenue sharing, we brought in 1.26 compared to 1.28. And our HURF and VLT revenues outperformed with 508,000 and 346,000 for the quarter. So with that, that's my update on our local sales tax state share revenues, and I'm available for any questions. MAYOR FRIEDEL: Councilman? WATTS: So Paul, at a high level, it looks like 2024 compared to 2025, we did much better in 2025. That's why we're able to do more with infrastructure and amenities and still be conservative in approach. Is that a fair statement? SOLDINGER: Mayor, councilman, yeah, it's a pretty fair statement. 2024 was our best year as a town. We brought in a little over $40 million of revenue. Things are starting to slow down. But really, what's allowing us to invest more in infrastructure is the three-to-four-year period preceding that. We brought in more sales tax revenues well more than projected. We received grant funding from the federal government that allowed us to use some of that monies on law enforcement. So we were able to save TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 21 of 115 more money in our general fund and be able to do some of the things we've been doing in the last two years as far as making recommendations to council on putting a little bit additional money in the streets, capital projects as needed. But a lot of that has to do with the environment in the past. Right now, we are entering a little bit different period, but we have a lot of money. I wouldn't say a lot of money, that's not the best word. We have reserves saved up in our fund balances in those appropriate funds. So that's how we're able to do that. Of course, for example, fiscal year 26, we have a huge economic downturn, and we have to make cuts to our general fund budget. We're probably going to -- staff would probably recommend the council consider slowing down or stopping some of these capital projects as needed so we can reserve some of those fund balances and use them in future years when things kind of pick back up. But for now, a lot of it has to do with just the past five years, including fiscal year 24 and 25. WATTS: I think the point really is -- I want to make sure that everybody recognizes the good things that we're doing, that the improvements we're doing, even taking a conservative approach to our budget and how we're spending and putting money back into the infrastructure and amenities. We still have a long road to hoe, but we're doing a good job of it. SOLDINGER: Yeah, I appreciate that. MAYOR FRIEDEL: Paul, I'll just make a comment. It's really invaluable the service that you provide for this town and keeping track of this and staying on top of it for us. So this council appreciates that, and your wisdom is appreciated. Thank you. And with that, we'll move on to the call to the public, and I'll -- Pardon me? Oh. I'm sorry. No. Call the public. Yeah, call to the public. Town Clerk, are there any comment cards? TOWN CLERK: Mayor, no speaker cards. MAYOR FRIEDEL: No speaker cards. Okay. Thank you. And then we'll move on to the consent agenda. We have three items on there. I'd like a motion to approve the consent agenda items A, B, and C. KALIVIANAKIS: Motion to approve consent agenda. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 22 of 115 MAYOR FRIEDEL: Is there a second? EARLE: I'll second it. MAYOR FRIEDEL: We have a motion and a second. Roll call, please? TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Yes. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, seven-zero. MAYOR FRIEDEL: Thank you. So we will move on to our regular agenda, and I'm going to open a public hearing with our first topic, which is reviewing our amending of town's zoning ordinance for the Downtown Overlay District. Rachael? GOODWIN: Thank you, Mayor. I'm going to turn this item over to John. This has been a discussion at our recent Planning & Zoning meeting, and is now brought forward for discussion and direction to the Mayor and council regarding the Downtown Overlay District. WESLEY: Good evening, Mayor and council. Welcome back. Had a good summer break. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 23 of 115 As stated, the discussion for this item is a new chapter to our zoning ordinance, Chapter 27, Downtown Overlay District. Back in September of last year, the council approved downtown strategy. That strategy called for some updates to the zoning ordinance regulations to better implement the desired vision that we got from the public as we went through that process to create a more active and vibrant downtown to provide more employment opportunities, more mixed use residential opportunities, and the use and maintenance of vacant properties. So staff went to work right after the council approved that strategy and began to work on the updates of zoning ordinance to help implement the council's direction and vision. So just as a quick recap of where we are today, when we look this area of the downtown area, it's mostly zoned C-2. There's a small area that has a C-3 PD on it, but the rest of it is zoned C-2, but that also has two overlay districts: One is the Entertainment Overlay District, which mostly allows for some outdoor entertainment activities to occur; and another is a planned shopping plaza overlay district, which allows for zero setbacks. Pretty much a hundred percent lot coverage, has a common parking area, and then allows residential development on second floors, primarily by right, and more through special use permits. So the proposal is to create one new overlay and then to eliminate the two existing overlays. Over the years since we've had the Entertainment District, it's was put there to help encourage more active retail and entertainment uses. We haven't really seen too much activity by that. The Overlay District also proposes to increase by right residential uses and increase employment opportunities. So looking more specifically, then, at the proposal, the Downtown Overlay District would cover the area bounded by La Montana, Saguaro, and Avenue of the Fountains. But it's subdivided into three subdistricts, so looking at each of those and what the ordinance does for them. The Avenue District, which would then include uses by right and the C-1, C-C, and C-2 zoning districts, permits outdoor entertainment as in the current ordinance. But instead of requiring council approval for the encroachment permits in the right of way would TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 24 of 115 allow those be approved administratively by staff. This is how those could be done more expeditiously and help encourage that type of use. As proposed and sent to you by the P&Z Commission, increases the residential density from eight units per acre to 50 units per acre. So just to help understand what that means on a typical lot, today with the current code, we've been allowing two units per acre -- or two units on a 6,000 square foot lot. With a revised ordinance, it would be six units on that same 6,000 square foot lot. In comparison, the Park Place development is around, I believe, 48 units per acre, and SUP has been approved in one location in the same range, about 45 to 50 units per acre. So some precedent has been set for getting up close to that 50 units per acre. It does, however, in the overlay, not allow the residential on the ground floor within that area. When presented to the Planning & Zoning Commission, it also included some restrictions for the ground floor in the Avenue District to try to, over time, switch it from a lot of the office service type businesses, but -- and bring in more of the active retail, entertainment-type uses. And so the proposal there in the ordinance that went to P&Z, that was in within 50 feet of the street front that ground floor uses would be restricted. And this lists some of the types of uses that could still go in that area. Any existing businesses would be allowed to stay, but over time as as different suites, properties became vacant and would be replaced, that it would be these more active retail uses. The ordinance, again, is presented to the Planning & Zoning Commission did allow, though, for a property owner to apply for a SUP to continue to have the service and office type uses if they weren't able to fill it with the active retail. And again, in P&Z's review, they took this out of the ordinance as they recommended it to you. Another portion is the Business District. So again, allows uses by right in the C-0, C-1, C-C, and C-2 Districts, continues the overlay -- entertainment overlay uses, but removes the direct provision for the use of the right of way through an encroachment permit. Still be possible through another means in the Town Code, but it's not listed specifically here as a use or an activity. Again, increases the residential density to 50 units per acre as it did in the Avenue District. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 25 of 115 I did note as I went back through the ordinance today, that I missed one of the switches when I was updating the ordinance, and the one that you have in your packet says 30 units per acre still, as it was -- went to P&Z, but the intent was to make that 50. So just keep that in mind as we go forward and hopefully get to the motion again. Would allow this density by right on second floors and through SUP on the ground level as currently in the Code. The third area is the Innovation District. Again, allows this typical commercial type uses and in those districts. But the change here is to allow some light, industrial type uses as listed the laboratories, some manufacturing assembly of nonhazardous materials, some assembly and storage, and as in all the commercial districts, to allow residential use through an SUP. So those are the three subdistricts in the new overlay. This overlay also provides some opportunities for temporary uses of vacant properties within the District. Pop-up type activities or short-term uses. They wouldn't require full improvements as normally required by Code. So some of these vacant lots, until they're ready for actual development, we can get some use out of them and maybe help keep them a little cleaner and nicer for the town. There's some guidelines that the town engineer and myself have drafted up to help guide the use of these properties. Parking in the area continues. No changes in the Overlay District as to what it is currently. There has been some discussion about this as we went through the P&Z, and so just so again, the council understands, current code within plat 208. If you're the smaller lots or the ones not shaded in green, up to 10,800 square feet, your parking requirements are met through the common parking, and there's no requirement for any parking. There are five larger lots as it was originally developed, and those lots are required to provide, at the time, all their own parking. The last time we updated the shopping plaza overlay, we switched that so those property owners can apply for an SUP to switch at least up to 50 percent of their parking into the plat 208 area to provide some relief there. In the setbacks and lot coverage requirements of the existing code stay the same. We TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 26 of 115 did make one adjustment, and that is to require a build to line. Right now, it's a setback, and you can go there or further back. But in the downtown area, we're trying to create that urban core and feel, which means you really want the buildings brought up close to the street. And instead of just a setback, we have a bill to line in the plat 208 area with some exceptions where there are existing easements or setback things in the plat that they would have to observe. So Planning commission has recommended approval as they presented it. A staff can support that, but we also did want to bring to council's attention some of the changes -- some of the things that we had previously recommended to P&Z. Any questions for me at this time? MAYOR FRIEDEL: Councilman? SKILLICORN: Mr. Mayor, Director Wesley, one thing I wanted just to confirm was about the SUP for office space. When I read it, I thought it said something just a little bit different. So let's make sure we're a hundred percent clear. From what you just said in the presentation, is that in the downtown area office space is permitted with an SUP; is that correct? WESLEY: Mayor, vice mayor. So in the ordinance as recommended by the P&Z, there are no restrictions. Any of the C-1, C-2 uses are allowed by right at first floor, all along the avenue. It was in what was -- staff had presented to P&Z, and recommended to P&Z, that there was the limitation restriction that on the ground floors in the Avenue District only within 50 feet of the street, that the -- in the future, as spaces became vacant, they could not be filled with office service type uses. It needs to be an active use, unless they got approval of an SUP. SKILLICORN: And Mr. Mayor, Director Wesley, I mean, for a long time I've had this vision for a culinary district downtown. So more focused on restaurants, shops, coffee, you know, bars, ice cream shops, and less, you know, white collar offices, which are, frankly, obsolete. I'm almost wondering about, you know, making that a little bit more concrete. I mean, I like the way the wording, you know. Obviously, beyond 50 feet, that's fine. You know, that's fine. But for storefront locations, you know, prime retail TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 27 of 115 locations, you know, I really want an exclusion to be rock solid. And if we exclude that part about the SUP and just, you know, we leave it at this 50 feet, we can exclude office space for future development; is that correct? WESLEY: Yes. SKILLICORN: Yes? Okay. And then, Mr. Mayor, procedurally, are you looking for a motion before the end of the hearing, or do you want to, you know, gavel the hearing out and then hear a motion? How did you want to hear that procedurally? MAYOR FRIEDEL: So I think we need to have council discussion. SKILLICORN: Um-hum. MAYOR FRIEDEL: And then if there's -- and then we'll check and see if there's any public comment cards. And then we'll close the hearing, and then we'll work on a motion at that time. SKILLICORN: So Mr. Mayor, you want to do a motion after you gavel the hearing out, correct? MAYOR FRIEDEL: Correct. SKILLICORN: Thank you. MAYOR FRIEDEL: Councilman Watts? WATTS: John, I think I expressed my concern about the commercial aspect on the avenue, and I think -- I'm not a supporter of having commercial in it, but I am a supporter of retail, and restaurants, and all of the other aspects of retail. The other thing is that I'm concerned about is the 50 units per acre, as opposed to maybe 35 units per acre. I think that density is inherently problematic for the residents in the future. If you have an entertainment district, a bar down below, a sports bar, or something like that, it's going to cause problems. Third, I think we really need a component in there that goes back to something we had talked about a couple of years ago, which was very definitive, objective decibel readings that the MCSO can enforce based upon distances and decibel levels so that we can enforce it, rather than being subjective. And I think those are the three concerns that I've got at this point that I think warrant some further TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 28 of 115 discussion. MAYOR FRIEDEL: Councilwoman? MCMAHON: Thank you very much. John, if we restricted the use for downstairs to retail, would that take care of what we're talking about as far as office use, et cetera, or do you need something larger in scope? Because it says that staff recommends we go back, I think, to something like that. Or -- WESLEY: Mayor, councilmember, I think the best way to to answer the question clearly -- so certainly, in staff had looked at it based on the comments that we understood from the -- MCMAHON: Right. WESLEY: --public and other comments, such as the vice mayor made a moment ago about this desire we've heard in the community to help the Avenue really become that entertainment district that was envisioned when that overlay -- MCMAHON: Um-hum. WESLEY: -- was created in 2016, we felt it was important to put some restrictions on the uses that could go in as spaces became vacant and leave it and encourage through that, then, active retail, restaurants, entertainment type venues. MCMAHON: Um-hum. WESLEY: And so that's what we had recommended to the P&Z. They took that out of the ordinance as it has been sent to you. So if it's the desire of the council for that restriction to be there -- MCMAHON: Okay. WESLEY: -- the council would need to make that change. MCMAHON: Right. Okay. And a lot of those things are listed, so thank you for responding. MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Thank you, Mr. Mayor. Thank you for your presentation, John. I would really like to just -- what I would recommend is just a clean version as it is -- as has been recommended by Planning & TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 29 of 115 Zoning. I watch those meetings. They took a lot of time, and a lot of deliberation, and thoughtful process to do this. I think if we eliminate the possibility of an SUP, you know, all that does is binds this council, and Planning & Zoning, and the staff, from having flexibility in the future. And I trust this council and Planning & Zoning and the staff that if we do need some flexibility, it's available. I don't think we should just short circuit that flexible element here. And then the second thing is as far as 50 units is concerned, I would go with the P&Z recommendation on that too. You know, when developers build these structures, you know, it is a business model, and giving them more flexibility to make a profitable business model is, to me, paramount. And again, I just hate for the council to start micromanaging how many square feet a developer should put in their development. That should be market forces if people want to -- tend to get smaller studio apartments, I've got no problem with that. If they want to build three bedrooms, that's good too. But once again, you know, Planning & Zoning recommended 50, and I would support that recommendation. MAYOR FRIEDEL: Councilman? WATTS: John, one question I forgot. What is the distance between the curb and the build to line? WESLEY: Distance between the curb and build -- the curb? WATTS: Um-hum. WESLEY: That's going to fluctuate a little bit. WATTS: But you're building to line is based on something -- WESLEY: It's based on -- WATTS: On everything -- WESLEY: Pushed on the property line. The property line. So the -- it says at least 70 percent of the building face needs to be at the property line. WATTS: Because we're trying to get all the buildings fairly aligned -- WESLEY: Correct. WATTS: --going down the Avenue, correct? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 30 of 115 WESLEY: Right. WATTS: And so what you're saying is the setbacks -- the easements vary as we go down the Avenue of the Fountain? WESLEY: There are a few places where there are either easements or setbacks specified in the plat, and so we'd have to respect those. But otherwise -- and along the avenue, there is a five-foot setback all the way along the Avenue. WATTS: So the build to line is going to be -- WESLEY: Be would be then that -- WATTS: That five foot line? WESLEY: Right. WATTS: Okay. Thank you. MAYOR FRIEDEL: Councilwoman? LARRABEE Thank you, Mayor. Director Wesley, I just had a quick question. My understanding for an SUP would be that whether it's listed in the specific ordinance or not, a developer can request a SUP for exceptions to our zoning; is that accurate? WESLEY: Mayor, councilmember, it really needs to be a specific stated SUP. If we don't make provision for it in the code, then it wouldn't be possible. LARRABEE: There's not -- okay. Thank you. I must have misunderstood a previous conversation. Thank you. MAYOR FRIEDEL: John, I have a question dealing with the SUP. I think it's important to keep the SUP for flexibility, because if they can't put a retail or a -- like a hobby or a toy store or whatever in there, they have the flexibility to be able to put an office or professional CPA or whatever in that spot. My question is this: If we pass this ordinance, leave the SUP in there, and at some time down in the future they require an SUP because they can't get a retail spot or a bar in there, the SUP is presented, it's approved, is that SUP good into perpetuity? Or when that business leaves, does it revert back to the original district? WESLEY: Mayor, when a SUP is approved and the use is established, then it runs with TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 31 of 115 the land at that point, unless some other stipulation is put on the approval. MAYOR FRIEDEL: Yeah, I just wanted to be sure that was clear to everybody. KALIVIANAKIS: I'd like to make a move to approve ordinance 25-02. LARRABEE: Point of order. We're still in the hearing. MAYOR FRIEDEL: We are still in the hearing. We haven't closed the hearing yet. Is there any other council discussion? Do we have any comment cards, Town Clerk? TOWN CLERK: Mayor, we have three. One person is not speaking, and she wanted you to know she was against this. Two speakers are Larry Meyers, followed by Cecil Yates. MEYERS: Mayor, council. So amidst all the discussion of economic development and having been here for 44 years, and knowing full well that this was always intended as the fun zone, personally, I don't find realtors and accountants and insurance people very fun. So my first inclination is to do something to make it the fun zone. But then again, you don't own the land, and you zoned it a particular way. And so how are you going to tell the landowners what they can and can't do? So the first thing you have to do, actually, is change the zoning, which I think that's what this is intended to do. And since an SUP runs in perpetuity with the land, you're sort of boxing the fun zone out, so to speak. In basketball rebounding terms, you're never going to get what you fully intended as the fun zone. And then listening to our economic report, we're kind of stagnant or declining in our sales tax revenue, and the fun zone would probably be a boost to the economic sales tax revenue. So you're pretty much in a difficult position. And sometimes, you have to make difficult decision -- decisions in difficult positions. And I would say I support the way the town staff presents it, not the way the Planning & Zoning presents it. And one of the things that the Planning & Zoning just can't seem to get over is if you eliminate the parking restrictions that John spoke of, you will make the fun zone. And people, regardless of whether they have to walk a little further to have some fun, they will, because they do. The fair, people walk God knows how far to get to the fair. The car show they walk -- God knows how far to get to the car show. So if you want to have a TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 32 of 115 bunch of bars and restaurants, get rid of the parking, allow these people with the properties downtown to do what they need to do, and you'll help yourselves along and create the atmosphere that will allow the landowners to make their own correct decisions because everyone's motivated by money, and there is nothing this town can do, I don't believe, to encourage financially the landowners to make the decision you really want them to do. And so I support the way John has written it, not P&Z, and I would encourage you to do the same. Thank you. YATES: Evening, mayor and council. My name is Cecil Yates, 21-year resident, previous Planning & Zoning commissioner, twice elected to council, and all around good guy. I want to share with everyone the urban core concept is all over the world, all over the United States. In fact, we mirrored it when we built Park Place phase one. And so the proof is in the pudding. The concept of commercial on the first floor and residential above it creates its own little economy. It's kind of neat. But you do need population to do that. It's not just by zoning alone. You got to have critical mass. But what this does do is the additional housing opportunities for workers, place to live, younger folks, things of that nature. The fun zone, I like that, because it will attract that. And respectfully, Councilmember Watts, the density Park Place, we're at 53 units per acre, not 48. But I'm just saying, again, the market dictates that 1,000 square foot apartment or less is perfect, especially in our market, going to 35 per acre, like -- or what it was, was two units per 6,000. That's a 3,000 square foot apartment, and it really defeats the whole purpose. What it also does for us building owners, it creates another revenue source, because now your upper levels are pretty much feeding the whole operation of your building. And that way, you can respectfully give a discount to the first floor, or at least lower your overhead so it creates some other opportunities for primary retail users. Obviously, the sales tax that comes with that. I would stress -- And Madam Attorney, I haven't had the pleasure of meeting you yet. -- but I believe this is a prop 208 violation. You can give more property rights, but you cannot take them away. So zoning, whether it's with an SUP or not, telling a building TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 33 of 115 owner you can no longer rent it to a commercial user -- I'm sorry, an office or a nonretail user, I don't believe you can do that. But I will share if the model works, which it should, and the proof again is in Park Place phase one. Property values will rise, more retail users will come to the location because they know that they can capture those sales. But if you take that right away, you're losing a revenue source for those building folks. And ultimately -- and Councilmember Kalvininaki (sic) -- Brenda K., you hit it on the head, the market will drive this. So create the opportunity, the overlay's fine. Keep it simple, but do not take away property rights. And any way that you form this saying that, well, we're going to limit what you can do on your first floor, you should not do that. But this is a good idea. Thank you. MAYOR FRIEDEL: That's all? Okay. Any other discussion from council? I'm going to close it right now. All right. I'm going to close the hearing, and then we need to request a motion. Councilman Skillicorn? SKILLICORN: Thank you, Mr. Mayor. Yeah, I would like to make a motion to approve this with just two minor amendments. One, I do to strike the office space from the SUP language. And also, I want to make a minor change. The multifamily residential, I want to change that to up to 30 units per acre. MAYOR FRIEDEL: Councilwoman? LARRABEE: May I ask a clarifying question? MAYOR FRIEDEL: Sure. LARRABEE: Thank you. Mayor, councilmember, when you say "strike the office space", do you mean to return to the earlier language regarding retail? The restaurants, retail shops? SKILLICORN: That is the intent of the motion. Frankly, I don't see the SUP as being a benefit, or frankly, like, a zoning is a promise. But if the SUP remained with a limited amount of flexibility, but without office space, I think that's a fine compromise that I think the rest of council could go along with. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 34 of 115 LARRABEE: In that case, I second. MAYOR FRIEDEL: Councilman Watts? WATTS: The 30 with the sage advice of Cecil saying, you know, the 1,000 square foot, would you consider 40 is a middle ground between the 30. I mean, I personally, I prefer 35, but I think forty is middle ground between your 30 and the 50 we've got today. I think the product across the street at Park Place is a different product that we're going to end up with over on the retail, the restaurant side. I'd like to strike commercial and look at 40. Is that something you'd be willing to consider? SKILLICORN: So I'll entertain amending my motion. I think we should let the discussion advance before we get to that point. I mean, I also think that Councilwoman Larrabee had thoughts about parking, I know, in the past. And you know, this would be the time to do that, if she's prepared to do that also. So I think this discussion will go, and then we can -- WATTS: Fair enough. SKILLICORN: -- see what the consensus is. MAYOR FRIEDEL: Councilwoman McMahon? MCMAHON: Thank you. Unfortunately, I'm a little bit confused. Rachael, can you please -- it says to -- council to consider adding back in the section of the ordinance, you know, for active commercial uses. So is that the Town's preference? Is that the objective that the Town wants to achieve with this? Just answer that question, please. GOODWIN: I'm going to speak, but I'm going to welcome John back up if he'd like to chime in. MCMAHON: Okay. Thank you, John. Sorry, I wasn't sure if I could ask him back or not. GOODWIN: Sure. No, that's fine. And I'll give a brief answer and then let John fill in some of the details. But essentially, what was presented at P&Z was commercial focused, right? It was -- MCMAHON: Right. GOODWIN: -- to use -- TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 35 of 115 MCMAHON: That was my understanding. GOODWIN: -- Mr. Meyers terms, it was focused on a fun zone. It was intended to help create and incentivize more different uses down on our avenue. MCMAHON: Um-hum. GOODWIN: That's what was presented. However, P&Z's recommendations deviated from that quite a bit. So now, we're here asking council, which way would you like to go? Again, there's concerns that were brought up. The intent, yes, to answer your question, is to try to help reinvigorate our downtown, try to attract more activity, whether that's through, again, a lot of discussion about bars and restaurants, other retail, other things down there to, again, create this draw, this activity hub. And you know, a commercial corridor. That being said, John, what did I miss in that? WESLEY: Hm. Town Manager? Nothing. Perfect. But let me just elaborate just a little. MCMAHON: You said it all. WESLEY: Mayor, council, let me just read from the draft ordinances that went to the P&Z -- MCMAHON: Okay. WESLEY: -- Commission, the piece that got -- that was deleted -- MCMAHON: Thank you. WESLEY: -- from the ordinance so you can see what it said. So this was section A(1)(a). Uses listed in the -- this is permitted uses, then, in the Overlay District in the Avenue. "Uses listed in Zoning Ordinance Section 12.02 B. and C. provided, however, that ground floor uses within 50 feet of the right-of-way for the nearest adjacent street shall be limited to restaurants and cafes, bars and taverns; gift shops, apparel stores, variety stores and similar retail commercial stores, entertainment venues; or similar uses." So that's the way it was worded and listing the types of things we want to see in that area. And then you had attached to your packet a listing that we did from going through just TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 36 of 115 the nax codes of what types of uses we believe would meet that standard, and so it would not allow by right your typical office service type activities. MCMAHON: Thank you. So do you think that limiting, you know, to active commercial uses -- wouldn't it cover everything in this or no? WESLEY: Mayor, councilmember, my preference would be if that's the direction you want to go, if we just reinstate that same language that I just read that, as it went to the P&Z Commission, that that would be the way to handle it. MCMAHON: Okay. So I can make a motion to include that. WESLEY: Excuse me, but again, now the other question be back to the vice mayor's comment whether you want to also include the SUP option to add back in the -- MCMAHON: Right. WESLEY: -- uses that are being excluded. MCMAHON: So add back in the SUP option? WESLEY: Yeah, if you want -- so again, the ordinances that went to P&Z included the opportunity to apply for an SUP to be able to use any of the -- put in any of the uses that were excluded. So that'd be the other part of it, if you want to include that SUP for the excluded uses. MCMAHON: Okay. That's complicated. Okay. MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Thank you, Mr. Mayor. Yeah, just again, before we vote on the amendment, I just want to make clear that I'm for the -- the P&Z version of this, I thought it was well thought out. I do support the SUP, so we can take a look and do modify things as they come. And then when it comes to, you know, regulating it, again, the number of units, you know, when I ran for this office, you know, the less government, the better, you know? And again, we're up here right now trying to say the more gov-- we're going to do more government, we're going to do more regulations, we're going to tell private people what they can do with their property. And I'm just dead against it. I think this council is going in the wrong direction by invoking more government into the lives of the business TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 37 of 115 community. To me, this is a really easy decision. MAYOR FRIEDEL: Councilwoman? LARRABEE: I believe there may be a misunderstanding. Our current Overlay District allows for eight units per acre. We are increasing that, according to this motion, to 30. The question on the table is whether we would want to increase it further to 50. So when we talk about the increasing or decreasing of government, this is quite literally allowing for more as it is. I will also add that if my fellow councilmember is concerned about the government overreach, perhaps we change the zoning to a hundred per acre. MAYOR FRIEDEL: Councilman Watts? WATTS: I need a clear -- I need a clarification on -- the services that are there, the insurance companies, the real estate companies are service businesses and do not generate sales tax; is that correct? So the idea of having a fun area makes a lot of sense. And I agree with Councilwoman Larrabee that, look, we're going from eight to 30 or 40. However we get there, we've made a dramatic improvement to what can be as opposed to what can't be. And I think we look at it from a positive standpoint. I don't like the idea of having any kind of commercial in there. I could support the SUP. And so those are the two comments that I've got. But I want to make clear that the service businesses don't generate sales tax, and it was made real clear that we need the sales tax desperately. MAYOR FRIEDEL: Councilwoman? MCMAHON: Thank you. So I have a question for Councilmember Watts. So when you say you're not for commercial, are you for active retail? Is that what you're saying? You're narrowing it down even further, or are you accepting the language as written right now? WATTS: I think I could support the active retail if it generates sales tax. MCMAHON: Well, probably just keep it broad in the sense that active retail because that's really limiting. I mean, how do you -- WATTS: I don't know. MCMAHON: How are you going to define that? What's the quantitative thing? You TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 38 of 115 know what I'm saying? So I think if -- WATTS: Well, I think -- MCMAHON: If you want active retail, then active retail, because I think that's the point in getting more revenue. WATTS: I think that could be addressed with the SUP though. MCMAHON: I don't know. John? I mean, I'm more for the -- the way staff wants it than the way P&Z want it. And that's just my opinion. MAYOR FRIEDEL: Councilman Skillicorn? SKILLICORN: Thank you, Mr. Mayor. And maybe a clarification is due, because I think we're talking around the subject, and it might be -- so my motion was about taking office space out of the SUP so that -- even though real estate agents, attorneys, insurance agents, they're fun, but they're fun after 5 p.m. And I want to give opportunities for Fountain Hills to be more fun after 5 p.m. with restaurants, and bars, and billiard halls, and pinball arcades, whatever it's going to be. And so our white-collar staff can come and take their tie off and enjoy themselves in the evening. And maybe eventually they give up that location and a really great restaurant goes in. And we have Michelin, you know, level chef that comes in to Fountain Hills and puts us right on the map. That's my vision, and that's why I would prefer the office space. So we are kind of talking -- you know, kind of getting confused commercial. So retail good, right? So toy stores? Good. Clothing stores? Good. Like, you know, someone who sells vintage buttons. Good, right? But also, those restaurants, the coffee shops, the tea shops, things like that, very good, because all of them produce sales tax. So that's my vision behind that. So that's why I specifically said office space. And we love our real estate agents, we love our attorneys, we love our insurance agents, and we want them to stay, you know, past maybe 8 p.m. in our town. So that's my vision there. Also, this -- what I propose is a little bit more like what staff and Director Wesley proposed in that I still think it's a really good idea. I still think it's a value for our town. It promotes that vision. And what it does is it helps councils going forward. Now, if TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 39 of 115 council going forward wants to change this, they have the freedom to do that, right? They can even -- they can even add -- maybe we find a new innovative office space that's fun, and they want to add that back in, they can, and they have the freedom to do that. So I don't think this really limits that, but it does change it administratively. On the density, you know, the number I came up with was just a little bit less dense than what Councilman Watts wanted. I'm kind of curious what people's thoughts are on if it's 30, 35, which is what Councilman Watts proposed, or 40. I still think that Park Place is a very, very different building, because we're talking about the upstairs of the current development there. It's very, very different. It's not comparable. So I'm just kind of curious what people's thoughts are on that. MAYOR FRIEDEL: I'll give you my thoughts on that. I think we should have as high a density as we can allow. You get people to your downtown area and then you're compatible with Park Place. Make it all uniform. You want people in the downtown area. That's where you're going to drive residents with the higher density. And it's also going to help our sales tax revenue at the end of the day. And then I'll yield. And Councilwoman McMahon? MCMAHON: Thank you very much. Can we separate this into two other amendments? Like, one about the density, and then one about the uses of the commercial uses? Or can we make it into one motion to -- you know, as is, plus adding what staff wants? Or I mean, how do we want this motion to work so it's clear and we understand it because a lot has been said up here? MAYOR FRIEDEL: Well, we already have a motion and a second on the table. MCMAHON: For what? Can you please tell me again. Thank you. Oh, for -- MAYOR FRIEDEL: Council -- MCMAHON: -- the not having -- MAYOR FRIEDEL: Councilman Skillicorn. MCMAHON: -- an SUP and -- okay. MAYOR FRIEDEL: Yeah. MCMAHON: Thank you. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 40 of 115 MAYOR FRIEDEL: And then, John, you had the language already written that you had submitted? WESLEY: Yes, Mayor. And that that is part that I maybe still just a little bit unclear on. The easiest thing for us as staff at this point would be to say with regard to the limitation of uses is to include the language as recommended to P&Z, and then either with or without the option to apply for the SUP for the eliminated uses. Some of the other ways it's been discussed gets a little bit more confusing about how we would actually word that or handle that. We can make the changes, but it may mean having to you know, come back with that language. But otherwise, this'll be easy on the density, whatever density you decide on. MAYOR FRIEDEL: All right. And I don't want -- I don't want people to get hung up on the SUP because you don't have to approve the SUP. MCMAHON: Right. MAYOR FRIEDEL: So -- MCMAHON: Yeah. MAYOR FRIEDEL: But it does give some flexibility, if it's needed. So I think that's something that this council should consider because you have property owners that might need that flexibility down the road. MCMAHON: Gayle, what's next? MAYOR FRIEDEL: Councilwoman Gayle Earle? EARLE: Thank you. Allen, I would support the 35 units, going from eight units per acre to 35 units per acre. MCMAHON: Also, John, did you just say that you want to keep the language in this as what P&Z recommended? Sorry, I want to make sure. WESLEY: Staff has supported the language that we sent to P&Z, which includes the limitation on the uses on the Avenue -- MCMAHON: Okay. WESLEY: -- to encourage the act of retail restaurant-type atmosphere. MCMAHON: Okay. So I know there's a motion on the floor, but one is trying to make a TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 41 of 115 motion. I want to make the motion that includes that and keep the 50 units as stated in the P&Z's recommendation. So -- MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Yeah, sure thing. Thank you. Thank you, Mr. Mayor. I'd like to address this question to our new town attorney. Hey, Jen. What are the Prop 207 ramifications of what we're discussing tonight? WRIGHT: Thank you. So proposition 207 requires that if there's a down zoning, a downgrading of a property, that a property owner can apply for just compensation in order to receive the value of the property back. However, here, the question is whether or not Prop 207 applies is -- I mean, it applies, but is this really a down zoning of the property? Because arguably, restricting it a little bit further actually raises the value of the property. So you have to prove that -- so Prop 207 could be implicated, but this is a very gray area. This isn't one -- this isn't one where you're taking a zoning that is traditionally a very high value and then reducing it, like, taking it from one type of use to another use. It's drastically different that radically changes the value. So that's the Prop 207 question as to whether or not there is a -- if it actually reduces the property value. KALIVIANAKIS: Is there any verbiage that we could add to this that would minimize or mitigate any downward exposure? WRIGHT: Well, if there is a downward valuation, if there's -- a property owner who believes there's a downward valuation, they can submit a claim. And you can either choose to pay the claim or allow for a variance for that particular property. So there's something that can be done after the fact. You don't need to necessarily have it into the zoning, because it's kind of built into the options for how you mitigate it if someone were to have a valid claim that they could back with some support. And so you can -- KALIVIANAKIS: Okay. And -- WRIGHT: -- compensate them or give them a variance. KALIVIANAKIS: So a variance or an SUP? WRIGHT: Yeah. KALIVIANAKIS: Thank you. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 42 of 115 WESLEY: Mayor, if may. One of the options there, I think the one that is used sometimes is revert them back to the zoning prior to the change. So to revert them back to the two overlays as they exist today is an option that could be chosen. MAYOR FRIEDEL: Hm. Councilman Watts? WATTS: John, can you -- I can't find the Planning & Zoning verbiage. Can you read it to me? WESLEY: Sure. Yes. And it was attached in the packet. Oh, you mean as staff sent it to P&Z? That version? WATTS: That version is is staff recommended to -- WESLEY: Okay. WATTS: -- P&Z. WESLEY: Yes. WATTS: So we're focusing on the Entertainment Dist -- WESLEY: Right. WATTS: -- the Fun District as opposed to the commercial district. WESLEY: Right. Yes. Again, that that was attached there in the packet. So it's Section 27.02(A)(1)(a), which again, is a list of permitted uses in the Avenue District. "Uses listed in the Zoning Ordinance Sections 12.02 B. and C.", which is the section that lists all the primary commercial uses. GOODWIN: John, I'm sorry to interrupt you. And for the packet -- For those up here, it's page 388. So just so you can follow along with John. But it does get a little confusing in the packet, so I can see why you're looking for clarification. Go ahead, John. Sorry about that. WESLEY: It's okay. "Provided, however, that ground floor uses within 50 feet of the right-of-way for the nearest adjacent street shall be limited to restaurants and cafes; bars and taverns; gift shops, apparel stores, variety stores, and similar retail commercial stores; entertainment venues; or similar uses." Then from there, it goes into the entertainment activity things that are in the current ordinance. Museums, and then TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 43 of 115 also then gets to the multifamily residential up to 50 units per acre above the ground floor. MAYOR FRIEDEL: Thank you. Councilman Skillicorn? SKILLICORN: Yeah. Mr. Mayor, I just wonder if reverting to the staff's vision on the usage is just -- just forget about the SUP language and you just revert back to the staff's recommendation is fine. I mean, it meets the culinary district vision. It meets the entertainment district. You know, it's -- it's -- it enforced -- you know, it really enforces the fun zone. You know, I think that they put together, and I concur with their vision. And then, yeah, the density question, I think we heard, you know, we had one call for 35. I think 30 is better. I mean, we should feel what that conversation is. And you know -- but to answer some of the questions, you know, we -- about the SUP we talk about flexibility. Well, that flexibility undermines the intent of zoning, right? So if -- you know, and frankly, the emergence in the past 15 or 20 years of SUPs has really led to the gross over urbanization of America's cities made them too expensive to live in. Made, you know, other issues because of density, become very problematic. You know, not keeping it clean, keeping crime down, things like that, where we have a perfect little spot here where we're not over urbanized because of our lack of density. And I want to continue to keep that promise. And I also made a promise that we would never block people's views. Well, when you build denser, you block people's views. And I still remember when I first moved into Fountain Hills, I went and got my hair cut at a little shop. My direction's right over here. And I remember that the lady who cut my hair was like, the buildings downtown are too tall. And that was right when Park Place was built, right? That resonated with me. And people really think that in the town. So I just want to point that out. And you know, frankly, the density in other cities, has it helped them or hurt them? Has density in Tempe helped Tempe? Has density in Phoenix helped. Phoenix? I would argue it hasn't. And you know -- and I can go in -- there's a drastic -- I look at the City of Los Angeles. It's full of smog, and traffic, and crime, and pollution, because people 60 years ago didn't go, hey, maybe we should require, you TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 44 of 115 know, a quarter acre lots here. We wouldn't have those problems. I just want to -- I don't want to get into the situation here, and I'd argue over any more density. So I still want to argue for 30, but I'm a compromiser to my heart. So I'll go along with 35. I don't know about 40, though. So I mean, do we have -- do we have consensus on 35? All right. So I amend my motion to 35. And I'd like to just amend the usage to what Planning & Zoning recommended for the 50 feet. And we'll scratch the SUP language, especially if you think it's confusing to write that. MAYOR FRIEDEL: So Mayor, again, if I may. Do you mean -- do you mean to amend it to John's language? SKILLICORN Yes, absolutely. And I don't know if a Councilwoman Larrabee would like to resecond that or not. LARRABEE: Yes, I will resecond that, but I do also have a comment, if that's okay. Thank you. I also lean toward 30 because again, we're changing from eight to 30. That feels like a pretty significant jump to me. 35, it's not a huge difference. I'm happy to compromise. No problem. But I do want to kind of echo the caution to future councils that although density in your downtown and in our Avenue District is where we want density as far as -- that's going to be the highest density we have in town is going to be that Avenue District. However, should we set a precedent where we're going too far down that spectrum, then we set the precedent for the surrounding areas as well. And I recently took a -- this is a sidebar, but I'll get back, I promise. I recently took a trip to Nashville. A few of my friends, we commented, you know, I was a little disappointed by Broadway. Everyone talks about Broadway at Nashville, right? You drop me in the middle of that, I couldn't tell you which city I was in. If I look around, it looks just like Mill Ave. It looks just like downtown Phoenix. It looks just like -- I'm running out of examples, but Austin. I know that would never happen to that scale in Fountain Hills, but if you drop me in the middle of Fountain Hills, I want to know I'm in Fountain Hills. Point, blank, period. And I think we need to be very conscious as a council and on future councils of ensuring that you drop me in the middle of town, I know which town I'm in, and it's the best one in Arizona. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 45 of 115 WESLEY: Mayor? MAYOR FRIEDEL: Okay, we'll get the last couple of comments, and then I need to have a clear motion and a second, if that's possible. WESLEY: Mayor? MAYOR FRIEDEL: Councilwoman McMahon? MCMAHON: Thank you very much. We're not Nashville. We're not Los Angeles. We're a very small town. Our Avenue of the Fountains and the area isn't that big that I think that we have a really big, big density issue. And I think that the other way of looking at it is the square footage per unit that would be either enlarged or restricted to, like Cecil said, because, like, if you look at Park Place, you know, that smaller units, it generates a lot of revenue. And I think that given that we've already allowed that, I'm concerned about restricting it and maybe running into reducing the value of property, you know? That is more of a concern to me than, you know, limiting it to retail uses, so to speak. But that's my opinion on it. WESLEY: Mayor? MAYOR FRIEDEL: John? WESLEY: May I? So I want to pick up where we were a moment ago in terms of the permitted uses in the Avenue District, because I've just read the section that lists those permitted uses. The piece that follows that lists the uses allowed through special use permit, or what activities can happen through special use permit. It has two things. First, one is uses listed in Zoning Ordinance Section 12. 02 B. and C not permitted by right on the ground floor. So that's where the use permit language is to allow those other uses. So what I think I'm hearing from the vice mayor is we would scratch that. And so it is limited to the uses permitted by right, and so that needs to be clear. And the second one listed is multifamily residential above the ground floor at a density -- right now, it says more than 50, depending on what you change this to. 30, 35, 40. That language we would intend would go there. So there's still that potential for higher density, but it's through special use permit. So it's coming to the council on a case-by-case basis to see anything higher than what the by right would be. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 46 of 115 SKILLICORN: I think Mr. Mayor, Director Wesley just summed it up right there. So the, you know, the eliminate office, you know. Well, you know, use the staff put together usage. I like scratching the SUP, and you know, I think we've -- I think we have a consensus that 35 units per acre is acceptable. MCMAHON: What's the motion? SKILLICORN: That is the motion. MAYOR FRIEDEL: So your motion is to take the staff recommendation and the -- SKILLICORN: Yeah, the staff recommendation -- MCMAHON: Is -- SKILLICORN: -- except for scratching SUP, and 35. And Mr. Mayor, Director Wesley, what was the original staff recommendation for density? Or did you have one? WESLEY: So mayor, vice mayor, when we started this, I was being very tentative and suggested 15 because I wasn't sure there'd be an acceptance of that. SKILLICORN: It's like from God's mouth to Director Wesley's. WESLEY: But I was I was glad to increase it quickly to 30 when I felt they would support that -- SKILLICORN: Yeah, 30 would be good too. WESLEY: -- and then went on up to 50 with the P&Z as we discussed the examples already in the town center at the 45 to 50 range. So -- MCMAHON: So -- oh boy. MAYOR FRIEDEL: So we're sticking with 35? WESLEY: What's the motion? MAYOR FRIEDEL: And Hannah, you second that? LARRABEE: Yes. MAYOR FRIEDEL: So we have a motion and a second? Roll call, please. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember Larrabee? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 47 of 115 LARRABEE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Nay. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Nay. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Aye. TOWN CLERK: Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, five to two. MAYOR FRIEDEL: Okay. Agenda item B is relating to the extension of the building permits for phases two and three for Park Place development. Rachael? GOODWIN: All right. We're staying downtown. We're staying downtown for this discussion. John's going to introduce the item to give you a quick background on the request and why we're here tonight. WESLEY: Mayor and council, Park Place. We're familiar with it. It's just right next door. It's a project we've been looking forward to see extended in our downtown with the phases two and three on the avenue and over here on Verde River. Building permits have been approved and waiting for the applicant to be able to get his financing together. We've been, again, hopeful looking forward to that take place. He does have permits that have been approved previously. They have been, again, waiting to be paid for so they can be issued. We have, though, time limits that run with permits. They're good for 180 days after approval, but they can be extended. These permits have exceeded that time frame. Plus, we have come up to the point where, as you know, the 2024 building codes went into effect as of yesterday. Knowing that this change was coming and wanting to be able to keep this project TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 48 of 115 moving forward quickly, the applicant submitted a letter to us in August asking for the project to be able to continue under the 2018 codes as previously approved, rather than having to be redrawn under the 2024 codes. Staff is supportive of that, but felt it was important for the council to hear this and be the ones to make that decision going forward. And so the request was to allow the permits to remain active or able to be pulled up through the end of this year under the 2018 codes. MAYOR FRIEDEL: Vice mayor? SKILLICORN: Mr. Mayor, I actually like to make a motion to approve this, and also to urge Feds Chair Powell (ph.) to lower interest rates so we can get this done. LARRABEE: May I request an amendment to that motion? I'd like to propose an amendment to approve pending renegotiation of the development agreement on or before December 31st. Staff may approve renewing the Park Place permit pursuant to the 2018 Building Code. MCMAHON: I -- SKILLICORN: Second. MCMAHON: -- second that. LARRABEE: Sorry. MCMAHON: Nice try. LARRABEE: Technically, I'm amending, Allen's, so I don't know if he needs to accept it. Sorry. SKILLICORN: No, I can accept. It's going from May -- or to May. What was the original word? LARRABEE: Your original motion was just to approve -- SKILLICORN: As drafted. LARRABEE: My only ask is to tie that to the renegotiation of the development agreement. Should any changes occur with that project, it's ensuring that we have a signed development agreement that's agreed upon by both parties before we give those permits. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 49 of 115 SKILLICORN: Okay. LARRABEE: Okay. MAYOR FRIEDEL: So we have a motion and a second, but I'd like to find out if there's any comment cards. Town Clerk? TOWN CLERK: Mayor, we have three cards, three speakers. Bart Shea, Cecil Yates, and Betsy LaVoie. SHEA: Mayor, vice mayor, council, town manager, new attorney. I've met you yet. Hi. Thanks for the opportunity on it. Two things. One, thank you for the extension application. We're either going to be partnering with the new group or doing it ourselves here in the next probably 60 days. As far as the development agreement goes, the answer is we've got an estoppel from the town attorney in town saying we've complied with it. So it's kind of a dead subject, and I'm not willing to renegotiate the development agreement. So if that's going to be a stipulation on it, we can go back and look at the estoppel on it and see what it is. If we don't extend the permits, it's another 1.5 million out of my pocket to redraw plans again. So to date, right now, we've had five projects five times. This project's been financed in five times since we renegotiated the development agreement before it expired it that we have brought finance to the table. And in some way or fashion, something always happens with the town to enable us to not get the permits passed, or not get the financing passed. We've had 11 different redlines on the elevations of the plans, which took us seven months, which killed one of them. So I've had a lot of issues with it, and I've spent a lot of money, about 80 million so far in the town of Fountain Hills. Morning Star phase one, and you guys are right on track. You wanted an Entertainment District, heads in beds. Love to see it. I did probably well in excess of 30 different models to figure out what to put in downtown to make it work to get the Entertainment District. And by the way, I tried real hard to get a culinary school here at one point, offered them a free build out. We don't have bodies here yet to make it happen. It's the only way you get to that point is with heads in beds. If you put this back down again where are TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 50 of 115 you going to renegotiate it, you're going to go look at it again, you can kiss it goodbye for two years. That's how long it's going to take to redraw it, fix everything, reestablish everything, and go back to literally doing a start over on a renegotiation of a development agreement that we have an estoppel, which has been pulled once and reinstated on it and stuff. So if the council would like to renegotiate, I can't do it. We don't have the time, the effort, or anything else to go do it. MAYOR FRIEDEL: Bart, Councilman Watts has a question for you. SHEA: Sure. WATTS: I'm going to try and cut to the chase on this. You agreed to the development agreement originally -- SHEA: Right. WATTS: -- and it has expired. And the estoppel -- SHEA: Correct. WATTS: -- has expired. If there were no changes to the development agreement, would you still honor that agreement that we could -- SHEA: Absolutely. WATTS: -- move forward? Okay. So without any changes, you're fine? SHEA: Absolutely. WATTS: That all I need. SHEA: Park goes in, we finish off the downtown -- WATTS: I'm good. SHEA: -- we do everything else. WATTS: I'm good. SHEA: Yeah. And if we do end up selling, I've agreed to stay on and make sure all of that stuff is done. MAYOR FRIEDEL: Are there any other questions from the council for the applicant? MCMAHON: I do. MAYOR FRIEDEL: Peggy? MCMAHON: How can you guarantee what the buyer or another person is going to say TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 51 of 115 to this? And -- SHEA: Because I'm staying in the deal and they're sitting in the back of the room, and they'll come up and tell you they agree to it. MCMAHON: Oh, I don't think that you can guarantee for another person on something like this. I really don't. SHEA: I'm sorry, Councilmember McMahon, that was a direct question. And they're sitting in the back of the room, and they'll come up and tell you they'll guarantee it. MCMAHON: Again, it's an expired agreement. SHEA: It's not an expired agreement. I have an estoppel saying it's a -- MCMAHON: Yes, it is. SHEA: -- a completed agreement. So if you'd like to go to litigation on it -- MCMAHON: I knew you were going to say that. MAYOR FRIEDEL: No. MCMAHON: Mrs. Wright, do you have a comment? WRIGHT: Discussion of the actual development agreement is not on the agenda. MAYOR FRIEDEL: Correct. Thank you,. Thank you, Bart. SHEA: Thanks. KALIVIANAKIS: You know, I do have just one quick question. When you say you're going to partner with them -- SHEA: Yeah, I'll stay on the deal. I'll stay in the deal. I'll be the face. I'll be here through the entire project. KALIVIANAKIS: Will you have a financial interest, or just an advisory role? SHEA: We're talking about leaving a financial interest on the table right now. And no matter what -- so I still own the architectural firm, I still have everything to do with this, so I have to follow it through. It's in the contract, if they end up closing. It's not a guarantee that they're going to end up closing this. I rolled this into a finance package. Some of you know I've been quite involved with the Catholic Church on doing -- if you saw the business model on it. I'm rolling out five of those projects between the end of TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 52 of 115 this year and the beginning of next. And I through the financing for Maricopa, who, by the way, extended my permits on that project, 152 independent assisted living would count anything like this. And I've rolled Park Place into that and finance. So if they don't close, we will. KALIVIANAKIS: And the new people are ready to go, from what I've -- SHEA: They're ready to go. KALIVIANAKIS: -- from what I've understood. SHEA: Yeah, they're ready to go right now. They got a great -- their partner wants to stay in the deal and wants to be here and be part of Fountain Hills, as do they. KALIVIANAKIS: So if -- SHEA: This is not looking good. KALIVIANAKIS: So if tonight, if we just voted this straight up without any complications -- SHEA: Everything's fine. KALIVIANAKIS: -- then, yeah, we're -- SHEA: Everything's fine. KALIVIANAKIS: We're shovels in the ground and -- SHEA: Yeah. KALIVIANAKIS: -- we're paying for permits? SHEA: God, we hope so. But again, we're supposed to drop a quarter point on the interest rates next month, so hopefully, that'll will stimulate enough of the financing to get going. I had to throw it in because of Fountain Hills and what it is. I had to throw the project into a mix of almost $300 million worth of stuff that we're doing with other people. So -- KALIVIANAKIS: Right. And it is -- and it is your and your lawyer's surmised that the estoppel agreement does carry forth the DA -- SHEA: Yeah. KALIVIANAKIS: -- and that's what you're willing to litigate? SHEA: Well, yeah, it literally says that. So -- TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 53 of 115 KALIVIANAKIS: Right. SHEA: But again, the development agreement isn't on the agenda. KALIVIANAKIS: Right. But I'm just trying to get a clearer picture here, and I really appreciate your candor and just to know what's going on. SHEA: All I want to do is build a project. All I want to do is bring Fountain Hills stuff, and I want you to know all we do is argue about it constantly. KALIVIANAKIS: And I want you to build that project, just so you know. MAYOR FRIEDEL: Thank you. TOWN CLERK: Cecil Yates. Betsy LaVoie. YATES: Hi, again. Cecil Yates, 21- year resident, Planning & Zoning commissioner, councilmember. In fact, every year since I've lived here, I've served on some board, commission, or committed myself to the town. Very excited about this project. For the record, I left council in 2018. I ran two different development firms. I've known Bart Shea for 18, 19 years. He has built several of my projects with other firms. But I just want to stress I, in no way, shape, or form had any connection with Bart, other than being a councilmember and help this. So I've had the unique opportunity of being on both sides of the dais, having seen what happens on that side as well as on this side. I just want to share with you -- so 2016 is when the development agreement was signed. COVID happened, and for whatever reason, the council would not extend it, let it time out, and that caused one finance package left. 2023 as Bart pointed out -- and again, right, wrong or indifferent -- reclaim my time. MAYOR FRIEDEL: Go ahead. YATES: Thank you. 2023 as Bart pointed out, a normal exchange of plans and review is normally, like, three, maybe five reviews. We had 12. And we had in our developer's agreement that we're supposed to have a third-party reviewer to avoid that, and our third-party reviewer told us point up that the staff said I don't care, I'm going to review your review. And that, in fact, timed out. Anyone in business knows that money doesn't sleep and time kills all deals. So we lost that deal. This estoppel agreement is standard in commercial deals, and it's nothing more than a TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 54 of 115 landlord or a governing body basically on print saying yes, you are in compliance. We were held hostage, and they would not sign that document for another funding unless we had to sign this new amendment, and we were brought to that meeting under false pretenses. We're supposed to give an update, and the previous administration handed us a document. I was shocked Bart signed it, but we needed to close the deal, and he signed it. Well, needless to say, that financer said we can't move forward on this, so they left. So we used it under that structure, went to the fourth or fifth funder, and they looked at that and said we can't fund this either, and so we lost that deal. So we had to come back to the council and ask, guys, we can't do this. And that was a little contentious meeting because respectfully, we kind of had to pull the same thing you guys pulled on us and asked you to meet about why you were encroaching on our property to stage it for the Centennial Circle where you cut our locks and our chain and used our property without our permission. We're good people, and we let that happen, and we work with staff, and that was fine. But just to share with you where we can -- reclaim my time. Point is, we're here right now. My God, we're looking at all options all the time. We've got two financial deals on the table, and we've got a financial partner. This is going to close. But at the end of the day, Councilmember Watts, Councilmember Brenda K., it's pretty much extend the permit so we can get to the end of the year, and that's it. Thank you. LAVOIE: Mayor, vice mayor, council, staff. Betsy LaVoie, Fountain Hills Chamber of Commerce CEO and president. I did email this to all of you, so if it's repetitive, excuse me. But for everyone else in the audience, on behalf of the Fountain Hills Chamber of Commerce, I express our strong and continued support for the Park Place phase two and phase three. From the very beginning, the chamber has recognized the importance of this project to the economic vitality and quality of life in Fountain Hills, and we remain steadfast in our commitment to seeing it through to completion. The Park Place development represents much more than physical improvements. It's a cornerstone project that TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 55 of 115 supports our community's growth, enhances the vibrancy of our downtown area, and creates meaningful opportunities for both residents and businesses. With each phase, the development has shown measurable, positive impacts from attracting new investment and creating jobs, to strengthening our local economy, and fostering a sense of pride in our community. As the Fountain Hills Chamber of Commerce celebrates its 50th year of service to this community, we're proud to stand alongside Park Place development team. The successful completion of phase two and phase three will ensure Fountain Hills continues to thrive, while honoring the vision we've all supported since day one. We respectfully urge the full consideration and approval of the necessary support for this next phase in the Park Place development. The chamber and our members look forward to the continued transformation this project brings to our downtown, reinforcing Fountain Hills as a premier place to live, to work, to visit, and I'll add to play. Thank you. MAYOR FRIEDEL: Thank you. That's the last speaker, Town Clerk? Let me ask the council if we need a quick recess into an E-session to get any legal advice on this from our attorney. Is there any need for that? Anybody have any-- no? So we had a motion by Hannah, and did we have a second? MCMAHON: I second it. KALIVIANAKIS: I'd still like the discussion if I could, please. MAYOR FRIEDEL: Go ahead, Councilperson. KALIVIANAKIS: Thank you, Gerry. What I would like to propose is the suggested motion that is in our packet. Just a clean move to approve the request to extend the expiration date of Park Place phase two and phase three building permits to December 31st, 2025, and to allow the issuance of the permits in the 2018 codes. It's not a long period of time. There's been a lot of drama. There's been a lot of hardship to the town and to the developer. And at this point, I think it's a pretty reasonable ask to go on faith to tell them that, yeah, we're just unencumbered by any other language. Let's give them this, let's take it on faith that their arguments are correct, because I don't want to go back into court and see who's right and just -- let's get this thing approved, and let's get it TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 56 of 115 built. This is the vibrant downtown that we've all wanted, and it's sitting empty for all these years. And generally, it's because this council has been a little uncooperative. So you know, with all due respect to the motion on the floor, and I can't make a motion on it, I guess, until we vote on that -- but if I were to suggest a motion, it would be straight up what's in the packet, and let's just let this thing play out till December 31st. MAYOR FRIEDEL: I'll call on Rick in just a second. But I don't know that this council's been uncooperative. KALIVIANAKIS: I didn't mean to imply that. MAYOR FRIEDEL: Okay. All right. KALIVIANAKIS: No, it's just that there's just a history. MAYOR FRIEDEL: Okay. KALIVIANAKIS: And that's the last thing I meant. MAYOR FRIEDEL: All right. Councilman Watts? WATTS: No, you stole my thunder. That's exactly what I was going to say. It's not this council, and I would support the minor changes that Councilperson Larrabee made. MAYOR FRIEDEL: Turn your mic on. MCMAHON: Are you referring to the -- MAYOR FRIEDEL: Do you have a question? MCMAHON: -- motion that's on the table from Hannah? WATTS: Yes. MAYOR FRIEDEL: Yes. MCMAHON: Thank you very much. And I think that is the motion that suspends, basically, correct? Thank you. MAYOR FRIEDEL: So we have a motion to extend, and it's seconded by Gayle Earle, Councilwoman Earle. TOWN CLERK: Mayor, I show the motion was made by the Vice Mayor -- MAYOR FRIEDEL: Oh, I'm sorry. TOWN CLERK: -- and seconded by Councilmember Larrabee. MAYOR FRIEDEL: Larrabee. Okay. I'm sorry. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 57 of 115 MCMAHON: I think you clarified it. MAYOR FRIEDEL: Yeah. MCMAHON: Amended it. MAYOR FRIEDEL: Okay. So the motion by Councilman Skillicorn, second by Councilwoman Larrabee. MCMAHON: But she amended it. LARRABEE: Correct. The amended motion was accepted by Allen, so it's still his motion. MCMAHON: Oh, okay. Thank you. I -- MAYOR FRIEDEL: Okay. MCMAHON: -- want to make sure -- MAYOR FRIEDEL: So it's been -- MCMAHON: -- that we're all -- MAYOR FRIEDEL: -- amended and accepted. MCMAHON: -- know what we're doing here. MAYOR FRIEDEL: So the motion's been amended and accepted by Vice Mayor Skillicorn. MCMAHON: Thank you. KALIVIANAKIS: Can she repeat that just so we can refresh our memory? MAYOR FRIEDEL: Can you please repeat the amended motion? LARRABEE: Yes. Pending renegotiation of the development agreement -- and if I could asterisks that really fast -- that could very potentially mean we take the old agreement and just sign it again, and I would be supportive of that, to be very clear. On or before December 31st, staff may approve renewing the Park Place permit pursuant to the 2018 building code. KALIVIANAKIS: And I would just like to just repeat myself to say if that's the motion that we vote on -- LARRABEE: Point of order. You are not recognized. KALIVIANAKIS: And is approved -- LARRABEE: Point of order. MAYOR FRIEDEL: I did recognize him. I'm sorry. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 58 of 115 Go ahead. KALIVIANAKIS: He nodded. I would just like to let this council know just ahead of time that if we complicate it with the amended motion, I think we're heading to court. And I know it's a valid argument that, hey, you know, pending this and we're going to agree on that and take it on faith like this, I think we're going to be in court before we know it. And this thing is never going to happen. And I just want people to know -- I want to sit here right now, and I want to tell you that I think we should just grant them what they need. It's a couple months, and we'll be done. MAYOR FRIEDEL: Councilman Watts? WATTS: It's a technicality, but I asked the applicant point blank if we approve, will you honor the previous terms and conditions? The answer was yes. There's nothing complex about it. We're going to put it on the table. It's a technicality that we have to do. We'll do it, sign the papers, and move on, and it'll get approved. Simple. Unless you changed your mind. MAYOR FRIEDEL: I'm going to allow the applicant to make a statement. SHEA: I have a pretty big question now. So I'm being asked to put in more money and to go do this, and I have a development agreement that is estoppel and done. And I've agreed to everything in it, and nothing has changed on that. But now, we want to renegotiate that. But that's what the amendment actually says is to renegotiate it. And that's the problem. It doesn't say we're going to continue as is, we're not going to say we're going to go do it again. It just says we're going to renegotiate it. I don't have any idea what you're going to renegotiate. WATTS: I think it was on the advice of our attorney that we can't discuss the development agreement itself. SHEA: Okay. WATTS: So we're -- SHEA: But -- WATTS: -- not -- the renegotiating may be a poor choice of words. SHEA: Okay. But that's what the -- TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 59 of 115 WATTS: That's -- SHEA: -- amendment says. WATTS: That's what it says. SHEA: So you literally -- WATTS: So how do we get around it? SHEA: By amending it into your motion, Allen's motion -- I'm sorry, councilmember. TOWN CLERK: Can the -- SHEA: --amending it into Councilmember Skillicorn's motion, you've automatically brought it into the discussion, and you've talked about renegotiating it. So then I'm completely confused if you can't talk about it -- WATTS: We're not. SHEA: -- how do you amend it into it? MAYOR FRIEDEL: Let's hear from the town attorney. WRIGHT: So the issue is that there's concerns regarding the development agreement. We -- this is not agendized on regarding the -- the redevelopment agreement, but it is not legally possible for us to just approve the permits to be extended because there are issues under the underlying redevelopment -- or the development agreement, it does not mean that renegotiating -- maybe that's a poor choice of words. I think another word might be resolving the development agreement. And so that just needs to be resolved because under -- we can -- we don't need to debate this back and forth right now. Nobody's saying we're going to start from scratch on this -- there's been no discussion about starting from scratch in this redevelopment agreement. But as written, there are concerns. We just need to go in and basically rejigger the language to have the right dates. SHEA: No, ma'am. WRIGHT: That's it. SHEA: Then you need to extend this motion right now. You extend this right now. Because literally if you're going to go down this path before we get to that point, we TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 60 of 115 need to find out what that negotiation is. And all the lawyers can get involved and figure out what an estoppel means and what it means to be in compliance with and how it works and where it goes. Because you're talking about amending a legal document, a contract that I've signed which is assignable, which I have a letter from the town of Fountain Hills that says we are in complete compliance with -- and if you want to renegotiate or do something along those lines, this is just a business. I mean, I'm not here to get in a political argument about who does what and how it works. But if you guys want to amend things, that's you're amending a contract that we have. I know everyone says, no, we don't want to amend things, but that's what the actual language says, renegotiate. WRIGHT: Mayor? MAYOR FRIEDEL: Yes. WRIGHT: Might I resolve this by suggesting that we change the motion one more time to change the word from renegotiate to resolve, where all we're saying is it's signed again, basically. SHEA: Then signed by who? WRIGHT: You and the town. So just as it was originally signed. What I am -- I can't discuss it, but -- SHEA: Okay. Then you need -- WRIGHT: How about I remove the word renegotiate, now? EARLE: We're discussing the agreement now. SHEA: No, you have to take it off, and either extend my -- we'll have this conversation about the development agreement tomorrow, the next day, whenever it is, to find out what it is we're trying to resolve. Because that's a broad statement. EARLE: It's not a -- SHEA: What are we resolving? You are the ones that brought it up. You're the ones that are. And this is a big, giant space. MAYOR FRIEDEL: Councilman Watts. EARLE: Can we vote on the motion? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 61 of 115 MAYOR FRIEDEL: Town attorney, can we resolve it by date only, and stipulate to that stipulation? WRIGHT: We can't even vote on that. It's not agendized. So the issue is, is that as written without the -- without -- the permit cannot just be extended because we have to resolve this. So we're trying to give leeway. We're trying to give breathing room to allow your project to move forward by approving today the permit extension, but also saying we got to kind of resolve one little item so that the staff is not forced to issue the permit without resolving one little item. SHEA: No, ma'am, no, ma'am. We're not going to do it. If that's the case, this is a big giant ambush, then again, because you're trying to resolve something. You didn't let me know about this before we made this application. WRIGHT: We're giving you breathing room. SHEA: No, you're not. WATTS: Mr. Mayor, I'd like to call the question. MAYOR FRIEDEL: That ends the discussion. So the question has been called. We have to vote -- we have to vote on that. SKILLICORN: Give us just a second. EARLE: Second. MAYOR FRIEDEL: Question's been called and there's a second. So there's no more discussion. We'll vote on the question. EARLE: Thank you. MAYOR FRIEDEL: Roll call please. WATTS: This is to limit debate. Let's call the question and limit debate and debate. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: No. TOWN CLERK: Councilmember Watts? WATTS: (audio interference) -- debate. No more discussion about how to resolve this, because we can't, right? EARLE: Right. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 62 of 115 WATTS: If we can't discuss the motion -- EARLE: It's not agendized. WATTS: Yes. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Aye. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 6-0. WATTS: 6-1. TOWN CLERK: Oh, I'm sorry, 6-1. WATTS: There's a motion on the floor, but (indiscernible). UNIDENTIFIED SPEAKER: (Indiscernible). WATTS: Yeah, there's a motion on the -- Mr. Mayor, there's a motion on the floor, and I -- I am -- the friendly amendment by Councilwoman Larrabee is fine with me, about changing amend to resolve. MAYOR FRIEDEL: We have a motion and a second. Roll call, please. TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember Earle? EARLE: Aye. Aye. TOWN CLERK: Councilmember Kalvianakis? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 63 of 115 KALIVIANAKIS: Nay. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Aye. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 6-1. MAYOR FRIEDEL: Item C. Is possible action relating to the ordinance for zoning signs. Rachael? GOODWIN: John, you're not done yet, tonight. We're going to discuss the ordinance amendments regarding the zoning, specific to the sign ordinances. This is something that was requested by a number of councilmembers with feedback that from planning and zoning. So now it's gone full circle. So we're back here tonight for further discussion and direction. WESLEY: Mayor and council, this quick recap of some history. Back in 2021, the town council approved a significant rewrite of the town ordinance, sign ordinance to bring it into compliance with the Reed v. Town of Gilbert Supreme Court requirements. From there, it's been amended a couple of times, most recently in October of 2023. At your January meeting, the council asked staff to review and revise the sign ordinance. We weren't given any specific direction at that point about what could be or should be considered. So we came back at your February 18th meeting, we had some councilmembers offer some ideas of things that they thought could be amended or changed in the in the ordinance. From there, we went to the Planning & Zoning Commission at May 12th meeting for general discussion, presented to them the items that had been brought up by members of the town council, gave the P&Z commission and staff -- or the citizens opportunity to suggest any other changes, comments they'd like to see, modifications to the current ordinance. Based on the input we received at that meeting, we went back to the P&Z Commission TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 64 of 115 at their August 11th meeting with the revised ordinance. They held a hearing and have made the recommendation that we have for you this evening. Based on their review, they are proposing three areas for change in the current ordinance; one dealing with A-frame signs, another dealing with signs for apartment complexes, and then election yard signs. So with regard to A-frame signs, they have recommended that the maximum size be increased from 6 square feet to 8 square feet, for an individual sign, and that the combined maximum, if they have more than one, be increased from 9 to 11. Current code allows one sign per public entry up to two signs. They proposed that we change this to just two signs per business, so that we're not looking at entries again for that. But each business can have two. And Mayor, I'll just go through these unless you want to talk about each one individually. Another item that we recognized as we were working on this text amendment is that there are some smaller apartment complexes being developed in town, that by the current code are not allowed either a wall sign or any type of monument sign. And so as we noticed that issue we have included in here the option if you're a apartment complex between 8 and 20 units in size, you can have either a wall sign or a monument sign, their choice. When they're larger than that, they can have both. Those smaller still wouldn't be able to have either. And then finally, with regard to yard signs current code allows two yard signs per residential lot at any time. To help during election seasons, that would change to four yard signs allowed during the same time period that the State allows the political signs. So 71 days prior to an election, you could have up to four yard signs. That returns to just two per yard the day after the election. And again, this does not impact the -- the signs allowed in the right of way per state statute. So those are the changes that the Planning & Zoning Commission has recommended to the sign code. MAYOR FRIEDEL: Councilwoman Earle. EARLE: I'd like to make a motion to move to approve ordinance 25-08. TOWN CLERK: Mayor? Mayor, we're still in public hearing. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 65 of 115 MAYOR FRIEDEL: Yeah, we're still in the public hearing. So we need to know if there's any comment cards. TOWN CLERK: Mayor, we have one speaker, Gene Schlecta. SCHLECTA: My name is Gene Schlecta. I'm a 30-year resident of the town. I'm a former town employee in planning and zoning, planning zoning commissioner and signed committee member from 15 years ago. So is Cecil, but he's gone. The first paragraph, under the purpose of the sign ordinance says we need to protect public health, safety and welfare. I would argue that over these years we've shortchanged our residents over the years. But as a resident, I'm appreciative of the excellent work done by our Planning & Zoning Department in this exercise and also the Planning & Zoning Commission, and they balanced business and residents interests. But I do have reservations amongst what was compiled, Commissioner Gray summed up things really well back in May, when he said it is not appropriate to be everything to everyone, every time. With that point in mind, the Commission agreed that A-frame signs must not be left out overnight. I agree. Commissioner Gray also said that leaving them out allows laziness, dilapidation and blowing signs around from nighttime winds. Think of the added dangers of signs in the streets around the sidewalks of our dark sky community. Fifteen years ago, I was tasked with monitoring adherence to sign regulations. All the concerns mentioned above happened. What's more, when required to bring in signs nightly, many of the businesses didn't even bother putting them back out, which spoke volumes. Do not overturn the commission's recommendations on this. Secondly, no business needs two A-frame signs, except perhaps for those that have two entrances. That's unnecessary clutter and a safety risk, period. They are a distraction to drivers. Regarding banners, expanding the already excessive allowance is ridiculous. For one thing, there's no monitoring of content and secondly, they deteriorate rapidly and reflect badly on our town esthetics. If there's a special need for extending the timing football season, for example, a simple temporary use permit is readily available. Finally, there is no reason to add two more election signs to make it four per property. During election times, I believe, there is no restriction to the number of signs in the right TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 66 of 115 of way, so there's really no need to change the ordinance. By the way, for too long I've seen signs come up in these meetings over 15 years, and with very little input from the residents. We can do better on that in the future. So I urge the council to adopt the Commission's recommendations with only the changes that I suggested. Thank you. MAYOR FRIEDEL: That's it. Thank you. I'll close the public hearing and then we can have discussion. Vice Mayor? SKILLICORN: Is the heavy gavel out? All right. I'm ready. Thank you, Mr. Mayor. Director Wesley, great job. I don't have a question for you, though, because you answered it in your presentation. So the one question I had, you answered a presentation that was fine. I did want to make a motion to approve this. You know, with a very minor edit, is that I wanted to strike the -- in -- the number two, the number of yard signs. I wanted to strike the election season. I mean, so the -- our First Amendment isn't null and void when election season ends. So I -- I would prefer four signs at any time on people's property, because election season only has to do with the right of way. And state law already tells us what to do on right away. But this is their own property, and I think the property owners should decide for themselves. And I would like to strike the election season from it. And looking for a second. LARRABEE: I'll second that with one clarifying comment. We do already have a few people in town that post-election signs in their windows. Or I have -- I know one person who lives by where my parents once lived that has a big wooden sign that's there all year round, and it really isn't, it really isn't an eyesore. And I agree the First Amendment doesn't start and stop during election season, so I'll second that. MAYOR FRIEDEL: Yeah, it -- well, did you actually have a change? LARRABEE: No, sorry, I was just commenting. I'm sorry. MAYOR FRIEDEL: Councilwoman McMahon? MCMAHON: Thank you, very much, I appreciate it. State law regulates election signs in the right of way or in our yards, et cetera during a certain period of time and living in an HOA, I went through this with a bunch of other people and looked at the law and it did regulate it. So I'm not sure if we can have political signs in our yards all the time, but TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 67 of 115 nevertheless here we are again, I think, what is this, the sixth or seventh time and thousands of dollars of staff time looking at the sign ordinance again. It was a perfectly good ordinance. I am just at a loss as to why we keep revisiting it. I -- even the Planning & Zoning Commission initially questioned the need for these revisions. They even --they expressed concerns about the potential proliferation of A signs and other signs and the impact of pedestrian safety. While I do support allowing monument and wall signage for small apartment complexes, I do not agree with the other proposed changes, especially those that would further increase political signage graffiti. As we'll see in the upcoming election, political signs are going to be excessive and saturate our town, and I anticipate that our staff will be flooded with calls and complaints and have to address them to, again, lots of staff time and pay. I recognize we all have free speech rights, but there are limitations on that to a degree. And I think that two signs in the yard -- political signs during the political period is fine. I think it's reasonable, especially with how many signs we're going to be seeing all over town. So I don't think it's in the town's best interest to pass this amendment to the sign ordinance. Thank you. MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Thank you, Mr. Mayor. I believe I recall when this item was first put on the future agenda, that Councilwoman Earle pointed out that there was two businesses that needed two signs. I think one of them was Grapeables, and there was a second business. And at that time, I suggested possibly a waiver and SUP. What's happened since then is this thing has morphed into a two -- because there were two businesses that needed two signs. And I do think that if you have a business with two points of access and egress, you should have two signs by right. That's a no brainer. Like the old Euro Pizza Cafe, you can go in the front and you can go in the back with the lake. But having every business by right, having two A-frame signs is, I believe, ridiculous. Rush Limbaugh, you know, one of my heroes said he liked to demonstrate absurdity by being absurd. And that's why a lot of people loved him, because he took things to the TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 68 of 115 extreme. If I can be allowed that indulgence tonight, I see Fountain Hills as a town where every business has two A-frame signs in front of their business impeding traffic, handicapped ADA concerns, and every house having four signs in front of their house. That's the -- and of course it's absurd, they're not going to do that. But that's what this mischief could lead to. I -- I would suggest that the planning and zoning originally got this and like with Councilmember McMahon said -- and John, I think you can confirm, they didn't want any changes; is that correct? WESLEY: Mayor, Commissioner, when we had the discussion back in May 11th, they were not in favor of the changes. KALIVIANAKIS: Yes. Yeah, I watched that meeting and then they couldn't make the vote that day, had to go back, and then it opened the door to make more modifications. But you know, I do think that the current sign ordinance is pretty good. I think that we could help the -- the few businesses that need that or we can put it in the amendment to this tonight, that if there's two separate points of access and egress by right, they can put two A-frame signs. But this is brushing with a way to broad brush stroke of the pen. So anyway I would -- I would suggest just keeping what we have with -- with just minor tweaks. MAYOR FRIEDEL: I'll just weigh in quickly and then I'll go to the vice mayor. I think if you're really business friendly and development friendly, there are about twenty businesses that have two entries or exits. We need to be supporting those businesses. You heard tonight from our finance director that sales are down. I think every business has every right to make every dollar they can, and I think most businesses will not have two signs, as you pointed out. It's absurd. But I want them to have the flexibility and the opportunity to make a living in this town. Those signs show engagement and that they're ready to do business with -- with our residents and out of town people. And those signs aren't necessarily for the residents. They're for the out of town people that come here for whatever events that are happening. It shows that they're ready to engage these people. And then I'll -- I'll turn over -- I'll yield over -- KALIVIANAKIS: But again, we could we could accomplish that just -- just by taking those TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 69 of 115 twenty businesses and giving -- giving them that right that they demonstrate the need that they need two -- two signs that we can have an approval process for that. Again, without making it by right for every business. MAYOR FRIEDEL: I think every business has that right. Vice Mayor? SKILLICORN: Thank you, Mr. Mayor. You know, earlier in this meeting, someone mentioned that less government, the better. And I couldn't agree more. That's really where this comes from. And a couple of statements that were, that were made, I mean, about like code enforcement, wasting time. I'm okay instructing code enforcement not to trouble themselves with this. They got more important things to do than count people's yard signs for -- for God's sake. The freedom is freedom. I think we should pass this. MAYOR FRIEDEL: Councilwoman Larabee? SKILLICORN: The Constitution says so. LARRABEE: Sorry. I heard a comment by a colleague, so I have it for the record. I tried to get rid of the sign ordinance and I got yelled at. But anyway, when we talk about the changes to this regarding the two signs admittedly, I did have to make a run to the ladies room, so maybe I missed it, but the comment was that it would impede traffic. Are the A-frame signs permitted in the roadway? UNIDENTIFIED SPEAKER: Pedestrian traffic. LARRABEE: Ah. I happen to know, you know, most even scooters or wheelchairs are -- are able to go around an A-frame sign. But when -- when we referred to the sign changes, I think there is absolutely a level of -- well, number one, yes, less government is better. And number two, most businesses aren't going to block their doorway with their signage. If they don't believe that they need two -- two A-frame signs, they're not going to get to A-frame signs. And I take the same opinion on the sign ordinance as I have since I got on this council, unlike some of my fellow councilmembers here. And you know, same with banners, same with A-frame signs, a business isn't going to make their business look bad, period. MAYOR FRIEDEL: Councilwoman Earle? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 70 of 115 EARLE: Yeah. I just want to clarify, because I was spoken about a minute ago. I brought this back and it was not for Grapeables or because -- actually, it was the box meat shop and some other shops that have one -- one door entrance, yet they're back tucked in where nobody can see them. So they'd like to have an A-frame by their business, and then also the entrance to the shopping -- wat do you -- the plaza. Thank you. The plaza. So that's why I would not like to restrict this to the number of doors you have. So again, I am going to be supporting this motion as put out by Vice Mayor. MAYOR FRIEDEL: So we have a motion? Do we have a motion yet? Yes. And a second. Roll call, please. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Nay. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Nay. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Scooters have the ability to steer, so I'm a yes. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 5-2. MAYOR FRIEDEL: Thank you. Now we have pavement management, Rachael. GOODWIN: All right. Moving right along. We're going to give John a break, and we're going to reintroduce Director Weldy back up here. We're going to be talking about our pavement management. The pavement that has -- we finished in '25. You guys heard a TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 71 of 115 little bit about that earlier in the earlier presentation, but specifically what we're looking to accomplish in FY 26 and get direction on that. WELDY: Thank you, Mr. Mayor, councilmembers, we're going to get an update of our condition based on the last analysis and the work that has taken place over the last few years from a Roadway Asset Services Representative, Zach Thomason is his name. He is a very technical, well informed, intelligent man. Please be sure to ask him questions if you have them. I may not be able to answer all the technical data, if you don't ask him now. THOMASON: All right. Thank you, Justin. Mr. Mayor and council, it is an absolute pleasure to be here with you today. Again, my name is Zach Thomason with Roadway Asset Services. And today we're going to talk about the fun zone of pavement management. One of my favorite topics, certainly one of my favorite topics. My children tell me it makes me the world's biggest nerd, as well. So I won't get too technical on you. We're going to stay high level with this. So before we get into the results of the model and what we did with the data that was captured back in 2022, let's talk about some terminology so that we're all on the same page. Centerline miles. You folks own and maintain approximately 168 centerline miles of roadway. Imagine yourself walking down the middle of a road, any road, you walk for one mile, that is one centerline mile of road. Now, if you account for area and number of lanes and width and all of that, you folks maintain approximately 3.5 million square yards of pavement. This is a huge asset on the books that you maintain on a daily basis. It's enough pavement to build a small two-lane road from here all the way to Vegas, if you so desired. In terms of replacement, if we think about roads as something on the balance sheet, the replacement value of your road network is approximately 325 million. So again, a huge asset that you folks maintain. We're going to talk about PCI score, that's a pavement condition index. It's an index that ranks the health of a road on a 0 to 100 scale. Zero is absolutely terrible turning back to gravel, 100 is a perfectly brand new road that's paved yesterday. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 72 of 115 We're going to talk a little bit about preservation activities. You folks do this. Preservation activities are lightweight, cost effective treatments that, by design, are intended to increase the life of a roadway at the absolute lowest cost. And I'll show you how we use those here in a bit, as well. And then lastly ASTMD 64, that's simply the rules that we adopt to do the assessment to assess the roadways and calculate the PCI scores as a part of it. So what's the purpose of pavement management? The purpose is simple. The purpose is to capture and select the right road at the right time with the right treatment. And we want to do so, so that we lower the cost of roadway ownership over the long term for the taxpayers and for you folks as well. So what you can see here, roads are really no different than any other asset in our lives. As they're in good condition, they are cheaper to maintain. There are cost effective, lightweight activities that we can apply. So when a road is in good condition, at the top of that first line that you see there, that -- that -- that degradation curve, typical preservation activities cost right around $4 a square yard. If we defer down to a mill and overlay, where you get down between that poor and fair category, it goes upwards of $45 a square yard. And if you defer again into total reconstruction, it's $87 or more per square yard, depending on the functional classification of that roadway. So think about roads. They're really no different than the cars that you drive. You change the oil. You flush the coolant. Not because you enjoy sitting at the dealership on a Saturday morning. You do so because you're attempting to -- to lower the cost of ownership for that vehicle. So you've made a conscious decision of maintaining it as opposed to swapping the engine every 30,000 miles. Roads are the same. This is the van, my kids like to call this the ghostbusters van. It arrived in town. It came through and drove the streets in November of 2022 to capture the condition data. There's a lot of sophisticated technology on it, high speed lasers, high definition cameras, GPS, inertial navigation, a lot of equipment that's used to do the automated assessment and survey. What you can see here is a sample of some of the imagery. On the top there, that's some of the right of way imagery that was captured in the field. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 73 of 115 We use it for QC purposes, but it can also be leveraged by the town to conduct other roadside asset inventories, like signs or sidewalks and curb and gutter pedestrian curb ramps and so forth. And then on the bottom there, that's the meat and potatoes. That's the imagery that's used to conduct the condition assessment that allows us to calculate a PCI score for every segment of road that the town maintains. So what did we start with? We're starting with the condition data that was captured in November of 2022. And that's what you're seeing here. To run further models to determine how much funding you folks need, we need to age the data. So every road in your network is assigned a deterioration curve that we've developed as a part of the pavement management program. So we age the data, and we also give you credit for all the good work that Public Works has done over the last several years as well. So you've gotten credit for all of the mill and overlay work, the micro surfacing, the slurry seals, everything that's been done since that last survey. So what you're looking at here, this is the current condition data that's been aged. So the current network average PCI of your roads is a 66. The backlog that you have is currently just shy of 8 percent. So let me put some of that into context. Right now nationally, what we see in terms of network average PCI scores is between 65 and a 70. So you folks are kind of at the lower end of the averages that we typically see. The percent of good roads can tell us a lot about how an agency has been funding their network over the last 5, 10 or 15 years, as well. So you can see 12 -- 12 -- nearly 13 thirteen percent of your network falls into the excellent category, which is roads that score above a PCI of an 85. Typically, we like to see about 20 to 25 percent, because that tells us if a road network has been adequately funded over the last decade or two. And then the last thing is backlog. So backlogs, all the big ticket work. It's the full reconstruction candidates and the partial reconstruction candidates in town. It's the expensive stuff, and it's all those very poor and poor roads that you see there on that bar graph on the left-hand side. So right now, less than 8 percent of your network falls into that category. That's a wonderful number. So typically I would tell folks less than 10 percent is financially ideal from a pavement management perspective, 12 percent is TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 74 of 115 what I call average and manageable, with 15 percent becoming a maximum recommended mark. And that's where us as consultants start to get concerned, because as you exceed 15 percent and start approaching that 20 percent mark, the backlog can effectively snowball on you faster than you can pump capital into the pavement management program without funding it with some sort of large influx of dollars. And I say that because if you look at all those marginal and fair roads, you have a lot of roads that are at the steepest part of their pavement deterioration curve. So what you're going to see in some of the models that we ran is that your backlog grows over time very quickly, even when you maintain existing PCI scores. So before we get there, very quickly, we used the full toolbox that town staff has available, all the tools in their toolbox. The slurry seals, the fog seals, the micro surfacing, the mill and overlays, the full depth reconstructions. We use the actual toolbox that they use in the field along with their costs. So all of the costs have been updated. Inflation factors have been updated to run these models so that it is as customized as can be specifically for you folks here in the town of Fountain Hills. So in terms of how the model works, very quickly here, one of the first things it does is it looks at things from a financial optimization perspective, completely unbiased. And all that means is, is it looks at the cost of deferral. If we kick the can on doing maintenance or preservation or rehabilitation, what is the cost of that deferment. So very sound financial management. After that we bring in sound engineering. So we look at things like pavement type, weaker roads deteriorate at a more strong -- at a -- at a faster rate. Pavement type, here your pre-incorporation roads, which are roads that are that do not currently meet town design standards, also deteriorate at a more rapid rate. So they have a higher priority in the system too. Higher volume roads, arterial roads, first collectors and then local residential roads. Very textbook pavement management from that standpoint. And then last but not least, we also use condition as a factor to break any tie breakers when prioritizing projects. So let me show you graphically here real quick how that cost of deferment works in the analysis. Very simply, and this is just a general illustration for this. But on the X axis TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 75 of 115 there, you'll see different treatment types that town staff has available throughout the network. That dollar figure is the cost per square yard to do that particular treatment in today's dollars. No inflation added. So what the pavement management system does is it goes through and it calculates that cost to kick in the can. What's the cost of deferral between each treatment category? Very simple basic math. And then lastly it goes through and identifies all the critical roads, meaning roads that are within two to three points of dropping into the next category. They're critical because if we don't capture them this year, they defer and they become exponentially more expensive next year. That's how financial optimization works. But we also have to balance it, because if you look at things from a pure financial optimization perspective, the full depth reconstructions get the short end of the stick on that. They're never funded, if you're only looking at financial optimization because the cost of deferral is a big goose egg, except for inflation, because there are full reconstruction today, there will be a full reconstruction tomorrow. So pavement management is about a balance of data, financial optimization, sound data using the distressed data that's captured in the field, along with pavement types that differentiate the different design standards within town as well. So let's take a look at some of the model results. One of the first things we do is we run a fix all analysis. If someone gave you a blank check to go out and fix all roads in like new condition, what would that magic number be? So that means some streets get a mill and overlay, some get a slurry seal, some get a micro surface. Everything gets what it needs. That magic number is just over $64 million to treat everything with what it would need today. Now, what's interesting about this is your pre-incorporation roads only account for 34 percent of your network by area. Okay. So only 34 percent of your network by area. However, the pre-incorporation roads, when you look at the fix all analysis represents 67 percent of the fix all costs. And if we drill one item deeper, 65 percent of this fix all costs are related to pre-incorporation full reconstruction needs. So these are older roads that have been around a long time that don't meet current design standards. So let's talk about the models themselves. So this is a series of models that were run. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 76 of 115 That top line that you see there is the fix all analysis. The bottom is the do nothing just to establish the ceiling and floor there. The lines that I'd like you to focus on, that first one is that baby blue line there in the middle. That's your current budget. So that legend says $4.25 million. To be clear, that is your $5 million budget. We have subtracted 15 percent for expenses such as engineering and inspection, traffic control, administration costs, things like that. But that's your $5 million budget that you would spend on the roadway network. So the models tell us that over the five-year horizon, you would drop a point from the 66 that you're forecasted at now to a 65 in 5 years' time at that current funding level. And then the other one there, that copper orange line, depending on how it's shown on your screen there, that is the steady state PCI budget, meaning to maintain your existing 66 as we forecast it today, you'd need about $4.5 million. So just a little more than being spent on the roadway network. And that's assuming the average 66 is an acceptable level of service to you folks. This another budget graph, same story, so I'm not going to stay here long. This time, you have the annual budget each year, the average annual budget each year on the X axis. And that blue line is the trend line where we've run over 10 different models to establish that relationship between funding and the outcome of PCI. So again, you see your budget in that green vertical line. You see the steady state budget in that orange line there as well of 4.5 million. And if you look all the way to the right, you see a pink scenario. This is the steady state backlog scenario. And what I want to point out is in your budget there of 4.25 million. We know the PCI drops to 65, but backlog is projected to increase to 17.6% in 5 years. Okay. And even at the steady state PCI budget scenario that maintains you at a 66, backlog still increases to 17 percent. So we know right away that maintaining existing PCI does not maintain backlog. It's a split distribution. That's not abnormal. That happens a lot for folks that have a growing backlog and an older network, as well. So on the last slide here, this is the backlog budget graph. So again we have the annual budget here on the X axis. This time that red line is the trend line. So you'll notice if you start at the right-hand side of the graph and you scan to the left, as we reduce funding, TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 77 of 115 backlog begins to increase. So if you're curious, the funding required to maintain existing backlog below that 8 percent mark is on the order of about $8.3 million per year to maintain backlog. Now, the net benefit is that PCI skyrockets to a network average of a 75, as well. That was a lot of information on a long night, and I'd be happy to answer any questions you have. MAYOR FRIEDEL: Councilman Watts? WATTS: In one of the early slides, you had $87 as a rehab number, and then you used $71 a square yard for the calculations. THOMASON: Yeah. WATTS: What's the difference between 87 and the 71? THOMASON: For sure. Yeah, that 87 is just an average. So the cost to do a full depth reconstruction is different on an arterial road and a collector road and a residential road. So that was just a blended average score there or a blended average number for illustration purposes. That's the only difference. WATTS: And that average is based upon the -- the top layers and the substrate on the varying roads. So sometimes you go deeper, sometimes you go shallower when you rebuild a road; is that correct? THOMASON: Right. Yeah. So it's primarily based on pavement type. So one of the things that we did with the pavement management program is build in the pre incorporation component, the -- the full depth reconstruction on a -- on a pre- incorporation road is going to be different than on other roads. WATTS: Okay. And so my second question is, you showed us what it is to hold steady state that $8.3 million. What does it take for us to get ahead of the curve and improve -- obviously it's going to take 10 million or so, but can you tell us what that would be to get ahead of it? Because we're going to -- right now we're behind it. THOMASON: Sure. WATTS: You know, one point every year it looks like. THOMASON: So I would argue -- I'm going to go back to that slide here real quick. I TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 78 of 115 would argue that that $8.3 million a year is getting ahead of it, because you're actually keeping backlog below that 10 percent mark. So below 10 percent is typically very financially ideal from a management perspective for the network. So I would argue that is getting ahead of it. If you were able to fund the network at that mark, you would keep backlog, you would arrest the growth in backlog, and you would also get that big bump in average conditions across the entire town. WATTS: Thank you. MAYOR FRIEDEL: Councilwoman? MCMAHON: Thank you. Thank you very much, I appreciate it. I appreciate you explaining about the backlog, but spending $8.3 million, if we have it just on the backlog, then that is that just addresses the backlog, it doesn't -- THOMASON: No. So that -- that -- that -- that particular scenario, that 8.3 million is not dedicated to backlog only. MCMAHON: Okay. THOMASON: That 8.3 million, funds other activities such as slurry seals and fog seals and preservation -- MCMAHON: Okay. THOMASON: -- and mill and overlay. That's the funding required to maintain existing steady state of your backlog. MCMAHON: Okay. THOMASON: And of course, you get that benefit, that big benefit of an increasing PCI score as a part of that, but it funds all activity types in the system. MCMAHON: Okay. And this is a question for Paul because I don't remember. I feel like my -- but what do we have in the fund right now to spend this year? Is it five or four or what is it, please? SOLDINGER: Mayor and Councilmember McMahon, so we have about 11.5 million, I believe, in the streets fund balance at the current time. We have budgeted about 7.2 million directly out of the streets fund. Of that, about 5 million for the pavement management program. We also budgeted an additional 5.4 million in the Capital TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 79 of 115 Projects Fund to be reimbursed from the Streets Fund. So total budget in the fiscal 2026 budget for pavement management of $10.4 million. MCMAHON: Okay. So. SOLDINGER: But let me let me emphasize on that a little bit. MCMAHON: Okay. SOLDINGER: I can see your -- MCMAHON: Sounds like a lot of money in the -- SOLDINGER: This is -- this is kind of a -- MCMAHON: -- you know, that we've ever had. SOLDINGER: -- one time thing. The Palomino project, that's kind of a one-time thing. We've been accumulating money in this fund because we've been -- staff has been recommending to council saying, hey, you'd like to do more streets. We can see that we've -- we've received that direction. Let's put a little bit more of this general fund excess reserve money here in the streets fund. We've done that the last few years where we -- MCMAHON: Okay. Thank you. SOLDINGER: -- accumulate and put in another, I want to say, about $8 million in that fund to allow us to do to do these types of activities. We're not going to be able to continue to do that every year unless something falls off, whether we're taking a step back on capital projects or we don't continue to save enough for the lake liner, there's a lot of different priorities, you know, so that's kind of a one-time thing. Going back to our base budget of what we've done in the last few years is about $5 million. MCMAHON: That's what I thought. SOLDINGER: And we can only really accomplish that by continuing to put at least some money into the streets fund, because we only bring in about $5 million of revenue each year into the streets fund, and right now we're budgeted at a little over 7 million. So we're spending down -- MCMAHON: Okay. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 80 of 115 SOLDINGER: -- up to $2 million per year of that fund balance. MCMAHON: Okay. And then the amount of money you just said, 11 million -- was -- does -- have we already paid for Palomino or does that take 5,000 out, and that's what we have less since -- SOLDINGER: Sorry, I didn't mean to cut you off. MCMAHON: -- street improvement. SOLDINGER: Go ahead. Sorry. MCMAHON: No, I'm just asking you. Is that the value that you gave me in the street fund, does -- have we already -- does that include payment for Palomino? So if we take 11, we minus 5 and we're back down to the lower numbers or -- SOLDINGER: Right. MCMAHON: -- could you please explain that? SOLDINGER: Yeah, Mayor, Councilmember, it's relatively simple math. We have about 11.5 million today. We're probably going to bring about 4.5 to 5 more million through into the streets fund throughout the rest of this year. So we're right around 16 to 16.5 million -- MCMAHON: Okay. SOLDINGER: -- somewhere around there. Then consider all the expenditures, let's say we spend 6 million total out of the streets fund for just the streets fund expenditures, and we spent another 5 million on Palomino. That's 11 million. We'll have million left over in the fund at year end if we don't do anything else. But you have to account for the revenues coming in next year. Okay. So then we can we can probably accommodate the $5 million budget or maybe a little bit more -- MCMAHON: Okay. SOLDINGER: -- without putting any other general fund reserves in there. MCMAHON: Okay. SOLDINGER: That's kind of where we're at, at this point. MCMAHON: Okay. Thanks so much. I appreciate your time. SOLDINGER: No problem. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 81 of 115 MAYOR FRIEDEL: Paul, nice try. SOLDINGER: So the 5 million that we're going to have left over, that includes Justin Weldy's crews for patching, all the maintenance and repairs. So it's not just -- it's -- there's multiple components of whatever that dollar amount is. There's -- yes, street repairs and there's patching and so on and so forth. MAYOR FRIEDEL: Can you break those down a little bit? SOLDINGER: Yeah. Justin might need to jump on this one, but out of the 7.2 million or so that's budgeted directly out of the Streets fund, about 2.2 million is for the staff, the streets technicians, I believe some of the engineering and some of the other public works costs that are directly related to streets. There's also some other things that like striping, cleanups of the streets, some repairs and maintenance throughout the year. So there's about $2.2 million earmarked directly for those types of nonpavement management type activities. Directly for the pavement management program where we pay a vendor typically we've been using M.R. Tanner as our vendor to do a lot of that road work. We have $5 million budgeted this year. Last year we had 5 million as well, but we actually -- Justin actually came to council to ask for some increases. I think we ended up at like 5.4 million in the budget. But of course that's the maximum we can spend. So I think it was a little bit less than that that we actually spent. WATTS: I just want to make it clear that it wasn't all going to go to new streets and then retrofitted the streets. That didn't make any sense. So and then I had one other question, and I think I just lost it and it was -- MAYOR FRIEDEL: Well, let me ask him -- WATTS: I'll think of it. MAYOR FRIEDEL: -- let me ask him a question, and maybe you'll recover yours. Are there any other significant nonpavement management fees that are paid out of the streets area. SOLDINGER: Justin do you have any of that knowledge. WELDY: Signs. SOLDINGER: Striping, signs, like reconstruction of sidewalks as needed, related to TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 82 of 115 streets repairs. It's all streets related but not the direct pavement management where we work with a consultant or a vendor, a construction vendor to do that type of stuff. WATTS: I remember my question. SOLDINGER: Okay. WATTS: We have a logistical issue as well because we only have two primary, maybe three primary egress, ingress roads. We can only get so many people, so many contractors in, what would be the maximum number that you would project from a dollar standpoint, that we could support logistically, that number of contractors to come in and do the work if we could get them. Because really, what it comes down to is there's a lot of small projects as well as large projects. SOLDINGER: Justin might be better to answer that question. I know for pavement management, we are considering doing, is it IFB or an RFP soon? So we're going to know more about that because we're going to do a bidding process for some of our pavement management projects, as well as Shea Boulevard widening, which it's a widening project, but it's still a streets project. So we're going to start seeing what kind of interest there is in the construction vendor space pretty soon, I would say, and we could probably talk more about that. We've -- we've typically used a cooperative agreement a lot of times for these streets, pavement projects. And like I said, we use M.R. Tanner a lot of times. WATTS: But shutting down a number of roads could cause chaos in town. We have to be careful of that as well. So thank you. MAYOR FRIEDEL: I think that's all we have as far as questions. Are there any comment cards? TOWN CLERK: No, Mayor. MAYOR FRIEDEL: Okay. So we need a motion. EARLE: I'm trying to make one. MAYOR FRIEDEL: Okay. EARLE: Oh, what does it say here? Okay. I move to direct staff to proceed with the streets as identified. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 83 of 115 LARRABEE: Second. MCMAHON: I think we still have more discussion. MAYOR FRIEDEL: Yeah, we have more discussion. LARRABEE: Oh, shoot. EARLE: We haven't actually identified those streets yet. So hang tight. MAYOR FRIEDEL: Yeah. EARLE: I trust you. I trust you. I mean, we can do that. WELDY: Thank you, Zach, for the presentation. Once again, the support that you provide to the staff to help us prepare for tonight is immeasurable. All of the pretty charts and graphs and numbers and discussions, you spend a few hours in Zoom meetings with Zach, Zach and his staff is they bounce back and forth. You start wondering whether or not you could get a job cutting grass somewhere where it's nice and cool, because it seems a little less complicated, but we appreciate it. So what he did was he gave you an update on the condition from where we are currently at. Is this the wrong one? Nope. Seems our PowerPoints are a little bit mixed up, but let's see what we can do. I had all of these open. All right. Here we go. Starting all over. And we're back. Maybe. So as I was stating earlier, before I went searching in the archives for my PowerPoint, Zach gave us an update of where we are currently at and gave you some general idea based on today's dollar figures and inflation, what we would need to maintain the current PCI or the level of service and the fix all, and also to some extent maintain and keep control of our backlog. Keep in mind that when we're putting unit prices together, it's based on current unit prices, invoicing, billing and a little bit of inflation in there because we are uncertain of what the market is going to be in the coming years, especially over the one to five year horizon. So what we are going to look at now are the roads that were selected by the aforementioned software and try and make some decisions based on what is best. And I'm going to make some strong recommendations as we go through this. The first slide TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 84 of 115 right here obviously discusses the 2026 street selections and the funding options. But before we get started, in fiscal years 2016 through 2018, the exhibit you see was a lot of paving work. It is now time for us to go back in there and preserve that. Zach explained this by spending a few dollars here, it saves a lot of money in the future. So in order to do that, we have to make a little bit of an investment and go in and do the preservative seal in the crack fill in this area. And this prolongs the life of the pavement and allows for this investment to continue to serve the community. These are programed projects that are not typically presented to mayor and council, but we want to make sure that you are aware of where at least $400,000 of the money for this year is going. Now we're going to move into last year we presented to you these streets right here, which are Kim and Scorpion, and explained to you that we were going to do a section of each of these, and then we were going to take the balance of that, and that balance would allow us to complete some other super segments. During that conversation and presentation, it was also noted that we would be returning to these streets and they would be programed, so we would now have not only a segment, but a super segment or an entire area paved in a short period of time. So for future paving projects, the same type of treatment would be applied to this entire section. This is one of those locations. The other one is right here, which is around Nicholas and the golf course area. We did a small section of that and then also expressed, in order to accomplish another super segment, we would need to return at the beginning of this year. This is that one. Now we're starting to look at the newer projects. And the way you're seeing it is the way it was presented with little to no changes. The exceptions to that is whenever we noted areas where we could include a larger area, they ran more modeling and allowed us to do a little bit more. So here's a little bit of section right here. This one right here is El Lago. So for the -- this is the section of El Lago that runs between La Montana and Fountain Hills Boulevard. And the treatment that is being called for here, and Zach explained this earlier. The modeling is based on all the different types of treatments that are available to us, best TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 85 of 115 on best pavement management practices. This one is a crack fill and a slurry seal. This right here includes preservative seal and mill and overlay. You'll note that the green line is actually an alley. Now keep in mind some of the alleys that you are seeing tonight are the only access to multifamily homes and/or the only access to some businesses. This right here is where I'm going to begin to make recommendations. And we're talking about Fountain Hills Boulevard. The software pulled a section of Fountain Hills Boulevard between where it intersects with Saguaro and McDowell Mountain Road. That's in front of the grade school. This is a relatively wide and long, expansive piece of pavement. In the past, our recommendation would be to the mayor and council. When these types of areas are selected, that they be deferred and or a different type less expensive treatment be considered. And then we -- gives us time to plan to do a super segment. Here's a super segment. Fountain Hills Boulevard from Palisades to McDowell Mountain Road to the grade school as a standalone single project. It allows us to create that super segment and one treatment type for that area. MAYOR FRIEDEL: Can I ask you a question? WELDY: Yes, sir. MAYOR FRIEDEL: I don't know if this is the right time or not, but looking at that, doing that one segment of Fountain Hills Boulevard. I'm wondering if we could consider replacing that part right now, because you just did some really nice patching on that road rather than doing just one section, take this and put it into next the next year and do the whole section, and maybe do a cape and chip seal on East Richmond. WELDY: Mr. Mayor, yes. However, I -- with a little bit of caveat there because of the length and the width and the projected cost to rebuild Fountain Hills Boulevard between Palisades and the Grade School or McDowell Mountain Road, it would take likely more than one year. So we could get all of the data and facts that we need pulled together, and also an estimate for the budget. In regards to using some of this year's funding to do a chip seal with a cape for Richwood, between Golden Eagle Boulevard and Boulder. Absolutely. We could consider that that that is one of our more challenging locations. It's a pre-incorporation road. It gets a considerable amount of traffic, not only for the TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 86 of 115 residential, but it is the delivery route for anybody that's having things delivered to their home. It's the default go to route. So we can certainly discuss that as we move forward. Tonight, we're not going to have the budget numbers for a chip seal with a cape, but we can certainly look into it if that is the consensus of the council. On this -- go ahead, sir. MAYOR FRIEDEL: Thank you. WELDY: You're welcome. On this slide, you'll also note there is another alley that is slated for some treatment. And then there is a complete rebuild off of Glenbrook down there on the bottom. These are two alleys that are south of Shay that run between Saguaro and basically Technology. These are the primary accesses for several businesses along Saguaro and/or Technology in that area. This is another one of the short segments. And again this is the software making selections based on the overall conditions. And that was all of them. So wait just a second here. I'm a little bit uncomfortable with that statement. After having had a pretty in-depth discussion. I felt that there was a section of Kings Tree on this. UNIDENTIFIED SPEAKER: Right there, go back one. WELDY: Perhaps I need a bigger screen or some glasses. So there's a short section of Kings Tree here. Kings Tree is another one of those roads that are similar to Fountain Hills Boulevard, Saguaro, Palisades, where we should really consider those stand alone projects. A good example is Palomino. That is a good example of what we should consider and budget and plan for in the coming years. Keep in mind that we are not going to just stop doing basic maintenance on any of the roads that are deferred or delayed as part of tonight's discussion, or any other discussions that we have moving forward. We will continue to apply some type of treatment and or maintenance to those areas. We are not simply going to give up and just move on. So having said that, my recommendation to the Mayor and Council, is that we delay or defer Kings Tree and we select another area in town that is suitable for a different type of treatment. And we also delay or defer Fountain Hills Boulevard from Saguaro north to McDowell Mountain Road and allow us to plan for these two major or one arterial TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 87 of 115 and one collector street. We can use that allotted funding, and we can have some budget numbers in -- in the coming weeks to show you where that money could be used. The Mayor noted just earlier that he would like for staff to consider doing a chip seal and a cape on Richwood between Golden Eagle Boulevard and Boulder. So let's get some clear direction and have a discussion about that and what we could possibly do. One of the things that we would need to do on Richwood prior to proceeding is we would need to go in and do a physical evaluation of it. There are areas in there that chip seal and a cape is just not going to help much. Those areas, we would need to saw cut and remove or mill depending on the type, and then repave smaller sections, especially at low flow crossings or at corners where there is a considerable amount of turning movements that has an effect on it. After those sections were repaired, then we would do a chip seal and a cape. As a reminder, we still have a chip seal and a cape pilot program, two locations. The first one is on El Lago, between Fountain Hills Boulevard and Palisades, where we went in, we did the necessary repairs in the travel lanes and in some of the intersections where there's a lot of turning movement. I would like to report that we are having incredible success with that pilot program, and the reason I'm referring to it as successful is because it has delayed any additional necessity to add any more funds to it. We were planning on maybe five to seven year, but it looks like we're going to be closer to the seven to year, seven to ten year time frame. The primary reason for that is we're not getting any rain. So if -- if the weather patterns begin to change and we get a little bit of rain, it's subject to change. The other pilot location was on Chama. On Chama, we had a post -- post incorporation section and a pre incorporation section. We did nothing to either one of those. We simply crack filled and then did a chipseal with a cape. The post incorporation section is holding out wonderfully. The pre incorporation looks good until you walk it or you drive on it, and then the rideability is a little bit rougher than we would like. We use that as lessons learned and would apply the lessons learned from not only El Lago, but also TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 88 of 115 Chama, and apply that to a place like Ridgewood. So having said that, is there a consensus from the council that we explore the possibility of doing a chipseal with a cape with some repairs on Richwood? With that, it will probably need about probably two or three weeks, possibly a little bit longer, to get all of that information and come back to you with a revised budget. With that, we don't have anything else related to pavement management to present tonight. So to be clear, we are going to pull Kings Tree out, we are going to pull Fountain Hills Boulevard out and either defer it or delay it, but continue to do maintenance on it and use that funding to accomplish -- the first priority is going to be Richwood. And if there's additional funding beyond that, we will pick a couple of other local roads where we can apply that funding that will benefit the community. All right. Appreciate the time. MAYOR FRIEDEL: Vice mayor. SKILLICORN: Mr. Mayor, I do want to echo your thoughts on Fountain Hills Boulevard up north. There's three concerns I have. One is the cost. Two is the recent repairs. That would be kind of thrown away. Number three is the inconvenience to our residents about traffic in that it's just it's just such a big piece of road. So I'm very concerned about that, and everything else I am supportive of. But that particular one, I would not be willing to vote tonight on, like, I want to -- I'll have to go there and see it kind of touch the grass a little bit before I make a decision on that. So if we were going to move ahead with recommendation, I would like it tabled, or if we recommend everything but Fountain Hills Boulevard, I'm happy with that. But with Fountain Hills Boulevard, I want to see it and -- and probably even talk to residents there before moving ahead. Just you know, the Mayor made a really good point, and it's a -- it's a major artery. MAYOR FRIEDEL: And I think -- I think Justin's recommendation is we wait on that one. Am I -- am I reading you right? LARRABEE: That's what I heard. WELDY: Mr. Mayor, that is correct. That we simply delay it. We don't put it off and not do anything. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 89 of 115 MAYOR FRIEDEL: So , we're delaying it? WELDY: Yeah. Just delayed, yeah. SKILLICORN: Then I'm probably okay. The consensus, I mean, Kings Tree -- is the councilman's wife, want to comment? Okay. MAYOR FRIEDEL: Councilwoman Earle? EARLE: I'm sorry, I was going to reiterate what you said. That I understood you to say, we're putting off Fountain Hills Boulevard in that section of Kings Tree and putting those funds towards Ridgewood. WELDY: The first, yes. Mr. Mayor -- EARLE: But we won't know what the expense of Ridgewood is yet. So are we going to not vote on anything tonight, we're waiting till you come back? MAYOR FRIEDEL: I think we're going to vote on it and then have him bring back the budget information on it. EARLE: Oh, okay. WELDY: Mr. Mayor, if I may, the preference for staff so we could get moving would be to recognize that we are going to delay or defer Kings Tree and Fountain Hills Boulevard and move forward with the balance of the roads that are shown tonight. MAYOR FRIEDEL: Correct. I agree, Councilwoman. LARRABEE: I would just like to make a motion to reflect that. So moving to approve the proposed street plan while deferring or delaying Kings Tree and Fountain Hills Boulevard and diverting those funds to Ridgewood and another project, if possible. EARLE: Second. WATTS: Second. EARLE: Third. MAYOR FRIEDEL: Okay. We have a motion and a second, and a third. Can we -- EARLE: Can I ask Justin a question? MAYOR FRIEDEL: Pardon me? EARLE: May I please ask Justin a question? MAYOR FRIEDEL: Sure. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 90 of 115 EARLE: Justin, are you okay with that? Given your knowledge of the streets and the boss results, et cetera? WELDY: Mr. Mayor, Councilmember, yes. EARLE: Okay. WELDY: There's been a considerable amount of concern and calls from the residents in the area of Ridgewood for several years now. EARLE: Okay. WELDY: And as a less expensive alternative, chipseal and a cape is a good way to address some of those concerns and allow for long term funding scenarios or planning. EARLE: Okay. Thank you very much. I appreciate your input. WELDY: You're welcome. SKILLICORN: And I just want to reiterate that Director Weldy, that chipseal that was done in Chama a few years ago. It turned out great. So I'm really happy with that technology. It has worked out. MAYOR FRIEDEL: Okay. So we have a motion and a second. Can we get a roll call, please? TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Aye. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Yes. TOWN CLERK: And Mayor Friedel? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 91 of 115 MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 7-0. MAYOR FRIEDEL: Thank you. And we'll move on now to item E, which is real -- action relating to Golden Eagle Impoundment. I guess Justin's up for that again, too. WELDY: Mr. Mayor, Councilmembers. We're here tonight to ask for the authorization of phase two of the Golden Eagle Impoundment Project. As part of the FY26 budget approval process, there were green light projects and a yellow and some yellow light projects. The Golden Eagle Impoundment is a yellow light project. As I noted earlier tonight when doing the public works update, we have reached substantial completion on that project. However, because we don't have access to the funding, because it's not approved, we can't pay for the balance of that project. It's also important to note that of the $300,000 that are currently budgeted there, a percentage of that money is going to go to pay for the work that was completed after June 30th. A little background on that. For a project of this size and complexity, it's not uncommon to bridge fiscal years as part of that planning process. In our discussions with the town manager and the CFO, we put a placeholder in this year to be able to pay for some of the work if it became necessary in this year. So again, we're asking for the project authorization and to be able to utilize that funding to pay any debt that was incurred after June 30th of this year. With that, if there are any questions, I'll certainly do my best to answer them. MAYOR FRIEDEL: Vice Mayor? SKILLICORN: Thank you, Mr. Mayor. You know, based on the CFO Soldinger's recommendations earlier about being a little more cautious, especially with yellow lights. I would like to slow down a little bit on some of these yellow lights, including this one. So I'm kind of curious on other people's thoughts. MAYOR FRIEDEL: Councilman Watts? WATTS: Well, I'm not so sure that we slow down, if we owe the money. SOLDINGER: Well, that, yes. WATTS: Okay. So we owe the money here. My question is, really, how do we -- these TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 92 of 115 change orders occurred during the course of the construction that occurred last year, '25, correct? WELDY: Mr. Mayor, Councilmember, that is correct. WATTS: Okay. And what's the process for approving the change order? How do how do we approve them and then budget for them and not pay them? I mean, if I'm a contractor, I want assurance that I'm going to be paid. So how do I do that? WELDY: It's -- it's -- I'm going to make it seem as uncomplicated as possible. So we entered into a contract with that firm. As part of that, there was a base budget and then there was an owner's allowance. Initially, the owner's allowance, including some unknowns, was included in there. So for each individual change order that they proposed, they were submitted to the town. We did a comprehensive review, we met, we discussed it, we made adjustments, and then we agreed to it and they agreed to it, and then that went into a placeholder as part of that budget. As we reached the end of the fiscal year, we had paid for a majority of those change orders that were taking place as the work was being done. Some of the balance is a small fraction of change orders that were addressed, but it's really the -- the rest of the work completed. So in regards to change orders, there is a vetting process, and it's a recorded document that we have in our file folders. We agree to it. Staff secures a separate purchase order for each individual change order, so it's also tracked by that. And we pay for that change order after the work is done. So there's just a about $77,000 encumbered for some change orders and additional work where we had unit numbers that were applied during the bid, but the quantities were expanded. A good example is a square footage of sidewalk or linear footage of safety rail. WATTS: And so this doesn't have anything to do with any of the retention. This is -- this is in total the contract plus the change orders. We still have the retention component to pay at some point in time. Do we have funds for that? WELDY: So for each pay application, a retention is pulled out and put into a separate account, and so that money is already accounted for in the budgeting and will be available to pay out once they satisfy the punch list and any O&M manuals or any other TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 93 of 115 challenges that we find. Right now, there's not any. WATTS: Thanks. WELDY: You're welcome. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: I do have just a couple questions. For the work that was completed after June 30th, what -- what is the total amount that is currently due to those contractors for -- for that work specifically? WELDY: Mr. Mayor, Councilmember, it's about a little bit more than $300,000 including the retainage. So again, the retainage is already spoken for and I don't have the total figure right here. I worked on it with accounting as we were meeting back and forth with the town manager some weeks ago, but it's about $300,000. LARRABEE: Okay. So that -- our approval of the capital improvement project, of course, allows you to then pay that amount, but what is the remaining work on the project? Because it shows the fiscal impact as $300,000. So are we just paying the contractor? WELDY: No, Councilmember. We also are still in design of phase two. So we're still paying the engineering firm to complete the design. The phase two documentation, which is primarily the face of the dam or the impoundment and the debris racks, is currently in review by ADWR and the Maricopa County Flood Control District. So a percentage of that money will go to pay for phase two design. And also there's a percentage in there that we owe the project managers for management and inspection, and then the balance will simply remain there. If we reach all of the design, then we'll ideally sooner rather than later, we'll be able to prepare for the future budget. But also approving this to go this year allows us to begin to submit our reimbursement to the Flood Control District for the $90,000 grant that we have in there as well. LARRABEE: Got it. So for the grant funding, that's really important. Thank you. In that case, I would like to motion to approve authorization of the CIP D6057. EARLE: I'll second, but I have a question. MAYOR FRIEDEL: Go ahead. EARLE: Okay. I read in here that there was a leftover 400,000 from last year. So are TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 94 of 115 we -- WELDY: Mr. Mayor, Councilmember, that is correct. EARLE: -- is -- are we asking -- so are we going to have 400,000 plus we want another 300,000 or does that 300 that -- so we're kind of only asking for another or less than 100,000? WELDY: Mr. Mayor, Councilmember, we're not asking for any additional funding. We already have $300,000 budgeted for this year. The balance that was unspent from last year goes back into the Capital Improvement Project Fund, and will be available for future years. It's not immediately available this year. It will be available -- so it's kind of a leapfrog process. So that money is currently not available for us to spend out of that project. It's just an unspent fund balance that remains in the bank. EARLE: Okay. Okay. So yeah, it's a good second. WELDY: We're not asking for any additional funding. UNIDENTIFIED SPEAKER: So it's really Paul's fault. WELDY: Nobody's at fault here except for me. If there's any fault to be pointed at. MAYOR FRIEDEL: Councilman Larrabee. LARRABEE: Sorry. MAYOR FRIEDEL: All right. So having said all that, are there any comment cards? TOWN CLERK: No, Mayor. MAYOR FRIEDEL: No. Okay. So we have a motion and a second. Can we get a roll call, please? TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Aye. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 95 of 115 TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Yes. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 7-0. MAYOR FRIEDEL: Thank you. And then we've got, I think, Justin, you're up again for Top Leaf Services. WELDY: Mr. Mayor, Councilmembers, this next agenda item is directly related to wash maintenance. As you'll recall, we've been before the council several times over the last few years asking for and being approved for funding. We -- last year had $350,000, but as of the -- as part of the budget discussions and approval process for this year, the mayor and council increased the wash maintenance budget to 450,000. This is where the challenge comes in. The contract that we currently have is capped at $350,000 annually. Also, the contract and its term limit is not beneficial. So what we are here to ask for tonight in regards to the amendment are two things. One, increase the amount to $450,000 and also revise the term dates to start on July 1st and end on June 30th. And that gives staff a better opportunity to utilize all of that funding during a fiscal year. I made it seem a little bit more complicated, especially given the number of conversations I've had with the town manager and our procurement officer and Paul. So it's -- really just we're trying to streamline it here and have the authority, because currently we can't start any work because the contract has reached its maximum dollar amount until it's amended. MAYOR FRIEDEL: Are you ready for questions, then? WELDY: Yes, sir, I am. MAYOR FRIEDEL: So I'm in favor of this. I think the wash maintenance is really important to get on. And with that, I'll ask the Vice Mayor if he has a question? SKILLICORN: Yeah. I just want to say I'm supportive, I mean, the reduction in fire, the TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 96 of 115 debris, the you know, habitat for wild animals and things like that. It it's all beneficial to people in town. So I am in support of this, and I'll make a motion to approve as drafted. EARLE: I'll second that. MAYOR FRIEDEL: Councilman Watts? WATTS: Justin, if we were at 350 last year and you asked for another 140, that's 490. Are you shortchanging yourself? And should you be at 490 or 500 this year so you don't have to come back to us anticipating that they'll be equal or greater amount of work to be done? WELDY: Mr. Mayor, councilmember, the budget that council approved was 450,000. We're not asking for any additional funding. We're just simply asking for a contract amendment to include that funding to $450,000 a year and change the term limit from July through June. WATTS: But are we going to run into that same thing where we're not going to have enough funds at the end of the year, considering that you came back for the 140 on top of the 350 last year? WELDY: No, sir, we're not going to have any issues. The $450,000 are going to allow us to proceed and make good progress in the coming years. WATTS: Okay. Thanks. MAYOR FRIEDEL: So we have a motion and a second. Do we have any comment cards? TOWN CLERK: No, Mayor. MAYOR FRIEDEL: Okay. Can we get a roll call vote, please. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Aye. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 97 of 115 TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Yes. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 7-0. MAYOR FRIEDEL: Thank you. WELDY: Thank you. MAYOR FRIEDEL: Okay. The next item, G, is a possible action relating to the ratification of the town attorney contract, Rachael. GOODWIN: Mayor, this was at the request of several councilmembers, to review and ratify the contract that was directed back in June. So at that June meeting, I was directed to fulfill the contract, to proceed with negotiating that and executing a contract for legal services with Tim Lasota's firm. We have done so. That contract has been executed. It's here before you tonight for ratification as it exceeds my current authorization level. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: I'd like to motion to approve the ratification of the town attorney contract, effective July 1st, 2025. EARLE: I'll second that. TOWN CLERK: Any comments? MAYOR FRIEDEL: Councilwoman McMahon? MCMAHON: Thank you very much. We recently went through a strict procurement process and in interviewing different law firms to apply for the attorney position. And during that time, I did have some -- numerous concerns and questions about the vacancy, the process and ultimate selection that still to this day remain unaddressed. I formally requested that we postpone the procurement interviews and hiring until we secured independent temporary legal counsel to oversee and ensure the integrity of the TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 98 of 115 selection. However, this request was denied or ignored. I, you know, given a few things that happened during this procurement process, I have really grave concerns that this was orchestrated to fire Pierce Coleman and hire the current law firm. And when a couple of reasons why I say that is because there were some emails exchanged between Mrs. Wright and La Sota, about -- and having them submit their resumes before there was any formal opening of the position. There was also a personal unprofessional, in my opinion, audit submitted by Gayle Earle in an E session that accused Pierce Coleman of overbilling under a flat fee contract. To me, this is suspicious. Along with the related communications. And none of these communications or these were disclosed to me prior to the E session. Also during the session Aaron Arnzen was available and waiting to be asked to come into the E session to defend his contract and his billable time and billing, but the Mayor did not allow him to do this. And I and I think that is really unprofessional. During the interview process, I listened to the different law firms that applied, and I personally think that this firm is one of the, the lesser qualified without direct municipal representation experience. Mr. Lasota filed two previous failed lawsuits against the town as well. One, he represented Rot trying to blame the -- our court clerk for a mistake that Rot made the Court bound to a strict compliance statute. Even some of the council sided with him on that, which was very surprising. He also represented Skillicorn in a frivolous lawsuit against town and me and three other council members. This case was also dismissed, and the judge commented overseeing the case admonished Mr. Lasota for sloppy pleadings and critical legal cases. That did -- he cited that did not support his arguments. Further, Skillicorn did not participate in the full procurement process. He only showed up when the interview involved Lasota and Mrs. Wright, which to me is suspicious, and I don't think that he should have been allowed to vote during the process. In addition, the -- this contract that we're looking at supporting is the same or similar professional attorney services contract that was previously criticized for allowing overbilling. It's now being used to hire new legal counsel. And while the their proposed TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 99 of 115 fee, in my opinion, may seem to be lower than Pierce Coleman's it's not, because they're allowed to add additional fees, costs and expenses. So it isn't a flat fee contract like the Pierce Coleman was. You know in my estimation, and based on the interviews, there was a larger law firm with a heck of a lot more professional experience than the one being hired and I think it's unfortunate that they weren't hired, you know, for these reasons and more, just the suspicious nature, in my opinion, of how this came down, I'm not going to be voting to approve or ratify the contract. Based on my legal knowledge and experience working with attorneys and legal staff, I do not believe this decision is in the town's interest, and I think we can and should do much better. Thank you. MAYOR FRIEDEL: Thank you. Councilwoman Larrabee? LARRABEE: I believe Councilmember Kalivianakis was ahead of me. MAYOR FRIEDEL: Councilwoman? KALIVIANAKIS: Thank you. Yeah, I won't belabor the fact. I do share a lot of Peggy's concerns about this contract. I do also find it suspicious that the attorney that was hired by Reclaim Our Town to sue this town and the law firm that was hired to file a federal court case against me and three other councilmembers by Councilmember Skillicorn was hired to represent the town. I just think it's a hell of a coincidence of the thousands of firms in Arizona that this is the one that was the best suit suited for this council. That being said, this has been widely reported in the Republic and the Fountain Hills Times on radio talk shows and a lot of other things. And it just leaves me with, with one question that I would like to -- and I think you got the votes and I will probably vote against this on principle, but it was reported in the newspaper that when Gayle Earle initiated her audit that ten days later that the La Sota law firm sent a fee structure and a resume to Gayle, not to the town, even though an RFP had not been issued. Obviously, if you're going to represent a town, you know what an RFP is and you know when it's appropriate, it's appropriate when the town issues, when they're when they're looking for a lawyer. That didn't happen in this case. So it does lend itself to suspicion. But it was reported that Gayle didn't ask you to send that, so my question to you is who TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 100 of 115 initiated this? Who asked you to send the RFP and the fee structure in the first place? GOODWIN: I'm sorry, I didn't realize I'd be taking questions during this period. KALIVIANAKIS: Well, you're on the agenda. So could you answer my question? GOODWIN: Who asked me to send it? I was aware that there was concerns that -- with the council, so I thought that I sent it. I mean, I'm not quite sure. Nobody asked me to send it. KALIVIANAKIS: So even though an RFP wasn't issued, you just took it upon yourself to send this to a councilmember? GOODWIN: Sure, yes. LARRABEE: Also, point of order. Any questions should be through the Mayor. GOODWIN: Yeah, I -- WATTS: Yeah, that should be through the Mayor, first of all. And secondly, I don't think it's unusual. I think we get resumes all the time. I had somebody send me a resume for a job here in town. It happens all the time. I don't think that's uncommon. KALIVIANAKIS: Not for a -- not for a law firm. WATTS: We didn't do an -- and we didn't do an RFP. And also, I want to make note that Peggy mentioned something that the mayor did not allow Aaron into the executive session. Aaron had plenty of opportunity to defend himself. EARLE: Bologna. WATTS: He chose not to. So let's get that on the record. EARLE: Then why did he leave? WATTS: The mayor had nothing to do with him not showing up for the council meeting, and -- EARLE: Yeah, you did. You were -- WATTS: -- had nothing to do with him not showing -- EARLE: -- were you running that meeting? WATTS: -- up to the next executive session. EARLE: You were running that meeting, right? LARRABEE: Councilmember, you are not recognized. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 101 of 115 EARLE: You were running that meeting? WATTS: Let me finish. EARLE: And that's why he left? WATTS: No, that's not why he left. EARLE: Because you -- he wasn't asked to come in. LARRABEE: Point of order. EARLE: He was waiting to come in. LARRABEE: We cannot be doing back and forth. Point of order. EARLE: I believe he was waiting to come in. KALIVIANAKIS: I believe I had the floor. LARRABEE: That's not a point of order. MAYOR FRIEDEL: You're done. KALIVIANAKIS: I would just like to point out that we have two attorneys in this town. One is a town attorney and one is a town prosecutor. And it's my suspicion that the same tactic -- tactic will be used to get rid of the town prosecutor and be replaced by this council. And I just want to go on record right now -- MAYOR FRIEDEL: That's not on the agenda. KALIVIANAKIS: -- just to -- MAYOR FRIEDEL: That's not on the agenda right now. KALIVIANAKIS: Put it on the record. MAYOR FRIEDEL: That is not on the agenda. We are not discussing the town prosecutor. He's not on the agenda. Thank you. KALIVIANAKIS: He will be. MAYOR FRIEDEL: That's enough. Councilman Watts? WATTS: I would like to just point out one thing, and that is we went through a full disclosure, a full publishing of the RFP criteria. We got responses from four firms. We had extensive interaction with those four firms in executive session. And we picked what we thought was the best qualified firm that fit the town's needs, not individual needs, but the town's needs. As an overall overview of what the town voters voted for, TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 102 of 115 which was a more conservative approach. There was nothing underhanded about whatever went on. It was all above board. It was published. There was ample opportunity for people to respond. They chose not to. And the respondents we interviewed, each one of them above board, all of that was detailed. I think it's ridiculous that something underhanded has been alluded to here. MAYOR FRIEDEL: Councilwoman Earle? EARLE: I would like it to be known that Aaron filed documents with the Arizona Corporation Commission to form his new firm on March 21, 2025. KALIVIANAKIS: So what? EARLE: That was well before he had the opportunity to come into -- MAYOR FRIEDEL: Stop interrupting. EARLE: -- the executive session and defend himself. He had intended to start his own firm and leave. So stop blaming me in trying to say that I tried to get him fired. That is not true. And he never informed the council that he was doing that. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: Thank you. My fellow councilmembers have a bad tendency to beat a dead horse, but the attorney issue for a quick review came from Councilmember Earle, going through the contract for that attorney and looking at whether or not originally we had audited it, as was stipulated in that contract, we had not audited it. She took it upon herself to go over these invoices, as is the regular work of a councilmember. If you're going through contracts as is -- it's something I promised when I ran. It's something Gayle promised when she ran, and she's living up to that. The other part of this that needs to be really clear is this was fully communicated to the council. We had an executive session regarding that audit, in that we were permitted to discuss her numbers and look at them thoroughly. There was even an opportunity to schedule another executive session, because we were approaching the time of the meeting for Aaron to come in and defend himself, our previous attorney. He chose not to do that. He was not fired. He quit on his own, and from what I understand, in a very explosive and unprofessional manner. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 103 of 115 Later, a statement was sent to our paper that called out Councilwoman Earle personally. Absolutely unacceptable, unprofessional behavior, as we have seen once again tonight by my fellow councilmembers. Now, perhaps if the existing rules of our council procedure do not personally call out councilmembers, were respected, or if simple meeting procedure was often followed, I would be more interested in my colleagues input when it comes to our legal representation. But considering their behavior consistently, especially over the last two years, I have zero interest in continuing this conversation. EARLE: Boy oh boy. If that's not out of line, I don't know what is. You just contradicted yourself, as usual. WATTS: I don't -- EARLE: And then I -- WATTS: I don't think you were recognized by the chair. EARLE: -- as far as Aaron -- as far as -- I'm responding to Gayle Earle. WATTS: You were not recognized by the chair. Would you stop with that kind of behavior? EARLE: Would you stop -- would you stop with your kind of condemning behavior? LARRABEE: Point of order. We cannot be going back and forth and speaking out of turn. This is complete -- I -- this is a point of order. MAYOR FRIEDEL: Hannah, that's -- let it go. Town Clerk, are there any -- are there any comment cards? TOWN CLERK: Yes, Mayor. We received two cards. One was in support of the ratification. The speaker is not present. We have one speaker, Larry Meyers. MEYERS: Hi. Yes. Greetings. Did you miss me? Probably not. So social media and our newspaper is filled with the nonsense from the left. Same nonsense that's occurring on the dais that is indefensible, regarding the information surrounding the issue of the new town attorney, replacing the former firm Pierce Coleman and Aaron Arnzen. While submersed in a stew of rot and rot supported government officials creating divisiveness in the town, the real truth is that the divisiveness began long before rot. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 104 of 115 It began with the Dickie supported website The Real Cecil Yates during her 2018 run for mayor. Filled with so many lies and misinformation that it was eventually forced off the web by a lawsuit. But I digress. I just thought the town needed to be reminded of this, since some are new to the fray, and this was long before the formation of the evil rot. But back to Arnzen and the real facts. The only -- one only needs to examine the highlights of his tenure. Every one of his actions from the beginning of the previous administration's left leanings, proved actions against the well-being of the -- and desires of the majority of the Fountain Hills residents, hence, the vote. Let's start with the residential detox or misnamed sober living. Recall the years of fighting to support proliferation of these facilities with high occupancy in Fountain Hills neighborhoods, at the behest of Dickie and her cohorts. Who wouldn't want a home packed full of drug addicts next to them in their peaceful Fountain Hills neighborhood? Moving on to the wireless broadband antenna and the residential right of way. Put otherwise in front of your house. He consulted with a California attorney who was nothing more than a tower lease salesman. He collaborated with Crown Castle, the tower firm of choice by big telecoms. Then, when forced to hire a real attorney to protect the residents, he refused to make available the very ordnance created by them, hiding it from our own P&Z for over a year. An ordinance four years later, we still don't have. Thank you very much. Ignoring the good work of a very, very smart resident. And who could forget the perfectly valid and provable ethics complaints against Dickie and her chums that he maneuvered into dismissal while making sure those much vaguer and less egregious by opponents stick and carried severe sanctions for a full year. Does anyone know that Aaron Arnzen, I think you do now, that Gayle brought it up, formed his own firm 45 days before his resignation and in a childlike council meeting. Boycott. True fact. Good riddance, I say. I would like to have 15 more seconds. WATTS: I make a motion to approve that. MEYERS: To the evil rot, government officials on the dais, I say confirm Jennifer Wright TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 105 of 115 and the La Sota law firm, I say administer advice according to the written law, not as anyone directs you to and to the residents of Fountain Hills, I say vote and vote to maintain your clear cut majority, so that the dark days are behind us in this town. And most definitely read the ramblings of the new Dickie supported Flourish Pack. Then blow your nose with the content. Flush it down the toilet. KALIVIANAKIS: I object. MEYERS: You will breathe much easier. KALIVIANAKIS: I object to this Mr. Mayor. I object to this. I am constantly gaveled down, interrupted and you tell me shut up Brenda, you can't speak. MAYOR FRIEDEL: You are out of order. KALIVIANAKIS: And then your friends can get up here and speak at will. MAYOR FRIEDEL: You're out of order. KALIVIANAKIS: You gavel down Peggy, you gavel down me, and -- MAYOR FRIEDEL: A motion was made to amend the -- KALIVIANAKIS: -- you let your friends talk. MAYOR FRIEDEL: -- a motion was made to amend the rules. You're out of order. KALIVIANAKIS: And you're a tyrant. MAYOR FRIEDEL: Do you need to be escorted out? I'll have the deputy escort you out, if there's one more interruption. Are there any other speakers, Town Clerk? TOWN CLERK: No, Mayor. MAYOR FRIEDEL: Thank you. Do we have a motion? TOWN CLERK: Mayor, we have a motion, a second. MAYOR FRIEDEL: Roll call, please. TOWN CLERK: Councilmember McMahon? MCMAHON: Nay. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember Earle? TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 106 of 115 EARLE: Aye. TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Nay. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Yes. TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: I'm going to explain my vote. This is the third time we've seen this contract come up. We had it in the RFP. We had it in on a previous agenda item and nothing was said by Councilperson Kalivianakis or McMahon. I'm an aye, thank you. TOWN CLERK: Mayor, 5-2. MAYOR FRIEDEL: Moving on to item H, discussion and possible action relating to the travel policy, Rachael. GOODWIN: Mayor and council, you might remember this item was also on our June 17th agenda. It was tabled. That indicates that it will be back on our next agenda, which is tonight. This is related to the recommendations and the requests brought forth by council. This -- this policy was drafted based on those directions. However, I know there was additional feedback and other concerns. The policies back before you tonight for any other follow up, directions are here. Paul has been sort of spearheading this draft, but we're open to any amendments or changes you guys might have. SOLDINGER: I think, I think Rachael said it all. Mayor and council, really we -- we had a draft in place. It was discussed at length at the June 17th meeting. It was tabled. So we're here reconsidering the draft that was presented originally. MAYOR FRIEDEL: Councilman Watts? WATTS: I think the only thing that -- in spirit, I think I agree with the majority of it, but I think that the one thing I disagree with is 50 miles in one direction. If it's 50 miles round trip, that's one thing. But I -- much like the stipend, which isn't here and I shouldn't talk about, but I'm going to -- TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 107 of 115 KALIVIANAKIS: It's not on the agenda. WATTS: -- it's, you know, I -- I knew what I was getting into when I ran for here. I knew what the stipend was. I knew what it entailed, and I would be incurring my own expenses based on the stipend in town. But I didn't say I was going to be a lobbyist and travel all over the place. So I think 50 miles round trip is more appropriate than 50 miles in one direction. MAYOR FRIEDEL: Councilwoman Earle? EARLE: Yes. I want to address a few things in here, and I know before we talked about this, was before I went in to the Arizona League of Cities and Towns, the conference. I've changed my stance on that. So I do see the benefit of being able to stay at the conference. It -- it wasn't that far. I mean, it was a 30-minute drive each way, but it -- it was a bit difficult being there 12 hours a day. And I would have liked to have, you know, anyway, so I'm changing that I would like to actually see the reimbursement for instead of putting a mileage limit to any, anywhere outside of the Fountain Hills -- outside of Fountain Hills boundaries. So I know the conference will always be -- it's going to be somewhere where they can hold a lot of people, so it's never going to be in Fountain Hills. It's never going to be close by. But I'm looking at that, and I don't see any other time that anyone on this council would go, be staying at any kind of a hotel for that. The other thing I would like to see is the mileage to be reimbursed based on -- in here it says, the most direct route from the point of departure. But what we've been doing, and I'd like to see that in here is from town hall is what we've done before. So I think that wording should be in there. Then the third thing I want to make sure that it's very clear in here that we do not pay for anybody's spouse or boyfriend, girlfriend, whoever that they're bringing with them, that they should not be partaking in the classes if they didn't -- weren't paid for. And I'm not sure if there's an extra expense for them to be in the hotel room. That should not be included either. MAYOR FRIEDEL: Councilwoman McMahon? MCMAHON: Thank you very much. Does this -- what about the staff policy? Wouldn't TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 108 of 115 it be easier if we just said to match the staff travel policy? Isn't this pretty same and similar to that one, or are there a lot of changes in it? GOODWIN: I mean, the version that has been put forth for the council is a bit more restrictive than the staff policy. So if the council would like to model the staff one, we can certainly do that. The staff, you know, we do have a policy written and again, I'll reiterate exactly what councilmember Earle said, it's there -- the conference is once a year. There's not generally overnight stays outside of that. There are other meetings that people attend, whether they're with Mag or Valley Metro or things like that, or G- Pec. So that reimbursement for mileage is, you know, kind of the only other outstanding element in that, in that conversation. So if -- if the council would like to just model after what the staff policy is, we certainly can do that. MCMAHON: I think that would be the simplest thing to do, because then we're all in concert. The staff knows the rules, you know, there's nothing really different about it, and it recognizes that we are all professional people sitting up here representing the town. We do travel outside of town and we use our personal vehicles, and I don't think requesting mileage has been abused. Personally, for me personally, I'm not going to request mileage to go to Scottsdale because I only went one way, the other way, and I really enjoyed going to the conference, being able to stay there. Like you Gayle Earle said, it's really convenient to do that. I think it would be much easier for us and staff to mirror yours, and instead of saying any mileage restriction, just say that when we're on traveling and when we're conducting and traveling for town business. I mean, that's usually when we only request mileage. We don't request it while we're in town. And I know that that's not allowed. So I guess I'm asking to just simplify this and just mirror the staff's, so we're all on the same page. I make a motion in that effect. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: I'm -- I'm not necessarily opposed to your proposal. However, if I could please get bullet points of what that -- what matching the staff policy would look like. What is the boundary? Is that saying outside of town? Is it -- what is the boundary for TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 109 of 115 the staff policy? SOLDINGER: Sure. Yeah. Mayor, Council, Councilwoman Larrabee, the policies are very similar. The main difference is going to be the distance limitation that was added at the direction of council in the spring. So the 50 miles was added to this draft. The only -- so we're talking about three main categories of reimbursement: mileage, meals and lodging. In the staff travel policy, there is a limitation on meals only, and that is you have to be outside of Maricopa County to qualify for that. But for lodging and for mileage, you're able to get reimbursed. LARRABEE: Okay. I'm -- I'm sorry to my fellow councilmember, but I -- I'm not supportive of just mirroring the staff one only because -- not that anyone on this council would do so. However, the reason that we are passing a travel policy is also for just setting the boundary for future councilmembers for, you know, 20, 30 years from now. I think there needs to be a standard set. And should someone say, well, I travel to town hall to, you know, once every two weeks and that's a mile or two. I just don't want to open the door to that. So I would prefer that we go with what Councilmember Earle suggested saying outside of the town boundary, not including meal reimbursement, but still keeping the lodging reimbursement. I -- I love that we have a, you know, a great policy for staff, but I think council deserves more boundaries because I like restricting the government. MAYOR FRIEDEL: Councilperson? KALIVIANAKIS: Thank you, Mr. Mayor. Yeah, I too would support Councilmember Earle's barring it for inside the Town of Fountain Hills, but allowing it to go to conferences and to attend regional meetings. I pulled this up and you know, providing city council members with compensation for mileage reimbursement is a widely considered legitimate practice. It's often essential, in an ethical way, to ensure that public service is accessible to individuals from all economic backgrounds. It encourages broader participation, and it removes the financial barriers for community members who may not be wealthy enough to absorb the cost of fuel, vehicle maintenance and insurance, et cetera. This allows for more diverse group of people to serve their TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 110 of 115 community. Mileage reimbursement is -- should be encouraged in business and school districts and government. It ensures councilmembers are not taking a loss by using their personal vehicles for legitimate city business. It incentivizes work, travel business, covers the cost of travel to attend city functions and all the other functions that are commensurate with the duties of the city council. And so it's -- again, to me, it's just good public policy to encourage your city council people to go to the regional meetings and anything that would deem either -- education or to attend meetings with Mag, the league and that sort of thing. It discourages that sort of -- it deincentivizes people to do anything other than just come to city council meetings. So I think -- I think Gayles was -- amendment was wise and I would support that. MAYOR FRIEDEL: Vice Mayor? SKILLICORN: Thank you, Mr. Mayor. And I think that there should we point out that there's a distinction between an employee and an elected official, an employee goes to a conference or an event or a meeting under the discretion of their supervisor. They're told to go there. It's part of their job duties to perform that and do that. So it's wholly appropriate to reimburse that person if they have to use their personal vehicle. Now, we do forget that there are town vehicles here that they can use and we can use, but just in that case, there is a very distinctive difference between an employee who is told to go to an event, or an elected official who chooses to go to an event. There's a big difference there, and that's why the policies are different. I -- you know, and I do want to point out there are town vehicles. So the argument that if people don't have -- I mean, people don't have the fiscal resources to go driving around. I get that right. But there is a town vehicle that is available to any elected official that wants to go to one of these. Heck, maybe we should carpool to save resources too. That'd be a great idea. It would also help save the environment. But this is not about just restricting going to conferences. That's a good thing. We want to encourage that, right? It's about discouraging taxpayer funded vacations, and that's all. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: Before we vote, I have one clarifying question for the travel policy. As, as TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 111 of 115 amended by Councilwoman Earle, should we approve that motion, I want to clarify, we would not be purchasing tickets for spouses or special friends, right? EARLE: It's in there. LARRABEE: Okay. Was that in the motion? Thank you. Oh, it's in the document. Okay. SOLDINGER: I believe so. LARRABEE: Perfect. Thank you. Okay. Perfect, thank you. MAYOR FRIEDEL: Councilman Watts? WATTS: And I also agree with Councilmember Earle. I disagree with Vice Mayor Skillicorn, though. My salespeople would go to various events, whether they were conferences, whether they were meet and greets to make new contacts. What we did at the League was amazingly valuable. Meeting people -- we got rid of our lobbyist, and I was a supporter of that. But we become the lobbyists. We become the point of contact. We become the sales people out there selling the benefits of the town. And for that, I think it's reasonable, because I don't think there's been any abuse. And it was once said that is -- this an issue looking for a problem. So if we say outside the town proper, the reasonable mileage if nobody's taking advantage, but I don't really want to drive down to G-Pec, 32 miles one way. And it sounds trite, but even, you know, $30, $40 for the cost of going down there. So I think it's reasonable to just do whatever the town policies are for staff outside the town were fine, and I'll support her motion. MAYOR FRIEDEL: Councilwoman? EARLE: So if we did not have a second on Peggy's motion, then can I make a motion? MAYOR FRIEDEL: Yes. EARLE: So I make a motion to -- she did, but nobody seconded hers. So I -- I guess, I didn't make a motion, so I will make it as a motion to accept this policy with changing -- let me see. It's under allowable and reimbursement expenses. Three, oh, personal vehicles reimbursement outside of Fountain Hills proper, as you said. And then also mileage -- Number V, mileage to be reimbursed from town hall, as the starting point, because that's what I've been told up to this point. So I just thought that should be worded in there. And then also -- TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 112 of 115 MCMAHON: Excuse me, if we leave from our home, I mean, then we don't come, right? EARLE: Well, but she did say -- MCMAHON: From point of origin? EARLE: I've been told we -- you always have to do it from town hall. MCMAHON: Okay. EARLE: That's what -- GOODWIN: We've just used Town Hall as a starting and finishing point for consistency's sake. EARLE: Okay. That's okay. And then on three, lodging a -- well, all of those under there, anything outside of the boundaries of Fountain Hills, in lieu of 50 miles. Those three, that's my motion. MCMAHON: I second. EARLE: Okay. MAYOR FRIEDEL: Motion and a second. Can we get a roll call? Oh, no. I'm sorry. Are there any comment cards? TOWN CLERK: No cards. MAYOR FRIEDEL: No cards. Okay. Can we get a roll call, please? TOWN CLERK: Councilmember Kalivianakis? KALIVIANAKIS: Aye. TOWN CLERK: Councilmember Larrabee? LARRABEE: Aye. TOWN CLERK: Councilmember Earle? EARLE: Aye. TOWN CLERK: Councilmember McMahon? MCMAHON: Aye. TOWN CLERK: Councilmember Watts? WATTS: Aye. TOWN CLERK: Vice Mayor Skillicorn? SKILLICORN: Nay. TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 113 of 115 TOWN CLERK: And Mayor Friedel? MAYOR FRIEDEL: Aye. TOWN CLERK: Mayor, 6-1. MAYOR FRIEDEL: Thank you. And we have council discussion and direction to the Town Manager. GOODWIN: Given that there was no public comment tonight on any items, I don't have any items noted for follow up, which is very, very rare. MAYOR FRIEDEL: Town Clerk, do you have something? Okay. Vice Mayor? SKILLICORN: Next one. MAYOR FRIEDEL: Oh, okay. So we'll move on to future agenda items. Vice Mayor? SKILLICORN: Thank you for acknowledging, Mr. Mayor. I did actually want to have two. One is, I would love to codify the president's EO on English as a primary language. If we can get some seconds. LARRABEE: Second. SKILLICORN: And the second one is that I would like to -- considering back in June of '24, the Supreme Court struck down the regulations about Grants Pass and having to pay for beds for homeless. I would like to dive into our vagrancy ordinance and -- and result of that. GOODWIN: I believe we have that agendized for the first meeting in October. So just as a heads up. SKILLICORN: Okay. MAYOR FRIEDEL: Councilwoman Larabee? LARRABEE: This would likely not be an immediate agenda item, but because there is a new sheriff in town, I would like to bring back my -- and I'm sorry. I'm going to make Rachael's ears bleed. I -- I talk about this all the time. The noise ordinance. It was alerted to me by previous comments by, actually Councilmember Watts today regarding specific decibels for downtown. I would really like to look at the noise ordinance and see if we can tie that to an objective standard, and I'd like to see if maybe our new sheriff is more amicable to that. I understand there were concerns regarding TOWN OF FOUNTAIN HILLS SEPTEMBER 2, 2025 TOWN COUNCIL MEETING MINUTES Page 114 of 115 prosecution. You know, if they're under 0.1 decibels, they're more likely to argue it. But I would really like to look into that still, just to have that objective standard and perhaps we figure out a range or something to that effect. MAYOR FRIEDEL: Yeah, using the decibel reader makes it non-subjective. EARLE: Okay. I'll second. GOODWIN: Just for follow up purposes, Councilmember Larrabee, do you -- you mentioned you're not -- that this is an item, but it's not necessarily an immediate item. Can you give us some leeway to coordinate that with the sheriff and his schedule and whatnot? LARRABEE: Absolutely. Absolutely. GOODWIN: Okay. I appreciate that. LARRABEE: So I don't expect that to be next meeting or anything like that. GOODWIN: Okay. We'll work with his schedule and figure out when the when we can make that happen. LARRABEE: Thank you. MAYOR FRIEDEL: Hearing anything else, can we get a motion to adjourn? KALIVIANAKIS: Motion to adjourn. MAYOR FRIEDEL: Second, anybody? You want to stay here all night, Gayle Earle? LARRABEE: I'm willing to. EARLE: Why am I the only one? MAYOR FRIEDEL: I don't know. KALIVIANAKIS: They don't like me. EARLE: I'll second it, I don't care. MAYOR FRIEDEL: All in favor? Aye. Motion -- meeting adjourned.