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HomeMy WebLinkAbout2015.0421.TCSM.Minutesz:\council packets\2015\r150507\150421m.docx Page 1 of 17 TOWN OF FOUNTAIN HILLS MINUTES OF THE SPECIAL BUDGET SESSION OF THE FOUNTAIN HILLS TOWN COUNCIL APRIL 21, 2015 * CALL TO ORDER AND ROLL CALL Mayor Kavanagh called the meeting to order at 5:02 p.m. in the Town Hall Council Chambers * ROLL CALL Present for roll call were the following members of the Town Council: Mayor Linda Kavanagh, Vice Mayor Dennis Brown, Councilmember Nick DePorter, Councilmember Cecil Yates, Councilmember Cassie Hansen, Councilmember Alan Magazine and Councilmember Henry Leger. Town Manager Ken Buchanan, Town Attorney Andrew McGuire and Town Clerk Bevelyn Bender were also present. AGENDA ITEM #1 - DISCUSSION WITH POSSIBLE DIRECTION RELATING TO THE PROPOSED TOWN OF FOUNTAIN HILLS FY 2015-16 BUDGET INCLUDING ALL PROPOSED REVENUES, EXPENDITURES AND PROGRAMS FOR ALL GOVERNMENTAL FUNDS. Mayor Kavanagh announced that public input will be taken following the presentation. Town Manager Ken Buchanan addressed the Council relative to this agenda it em and stated that the purpose of this evening's meeting is to review and possibly receive direction relative to the proposed Town of Fountain Hills FY 2 015- 16 Budget, including all proposed revenues, expenditures and programs for all governmental funds. He encouraged the members of the Council to ask questions as he goes through the presentation and stated that at the end of the presentation the public would be called upon to present any comments/questions they might have. He added that following that, the meeting will be opened up to Council deliberations. (Copy of the PowerPoint presentation on line and in the office of the Town Clerk.) Mr. Buchanan highlighted the PowerPoint budget presentation as follows: * Mission, Vision & Values * Financial Forecast Financial 5-Year Overview * General Fund Projections * HURF (Highway User Revenue Funds) Revenues * FY 2015-16 Budget Assumptions/Highlights Vice Mayor Brown commented that at the bottom of the page it states that the impact of recent legislation is unknown at this time and asked whether it has progressed to the point where they have a feel for what this is going to do to the Town. Mr. Buchanan responded that at this point in time they do not have a feel for it and stated that the Department of Revenue (DOR) is still trying to put all of this together. He added that they do know that the Town is going to pay $48,000 to DOR to administer their program but they don't know what the monetary impact is at this time and they might have to feel their way through. Vice Mayor Brown asked if DOR is actually going to go through with this and implement it and Mr. Buchanan replied yes. Mr. Buchanan continued with his PowerPoint presentation as follows: * State Imposed Expenditure Limitation Law/Exemptions * No New Employee Positions are Being Requested for FY 15-16 (A 2.5% Recommended Adjustment to the Salary Plan for Employees - $63,822) z:\council packets\2015\r150507\150421m.docx Page 2 of 17 * Departmental Funding Requests Not Funded Mayor Kavanagh referred to Movies in the Park and the Music Festival and noted that one thing the Town has been trying to do is attract young families and families with children and she thinks that the two Movies in the Park, which cost a little over $8,350 is an amenity that families in Town have really enjoyed. She pointed out that it is the only free amenity in the park for young children and said that it was started by a volunteer, Natalie Varela, and the movies have been very successful -- attendance at the last Movie in the Park was fantastic, people of all ages were in att endance, and she believes this is a great home town event. She advised that she would like to see funding for that put back into the budget along with the Music Festival. She stated that the one thing she hears is that people would like to have music every Sunday like they do up in Cave Creek and added that those people all go up to Cave Creek to hear the music. She commented that although from a financial standpoint the Town cannot do that every Sunday at least they could have a one time a year event which is free. She advised that this too was very well attended and could be a very successful annual event and requested that funding for that be put back into the budget as well ($5,000). She reported that she is talking about a total of $13,250 and suggested that the funding be taken out of the Town's Contingency Fund. Councilmember DePorter agreed with the Mayor's comments and reported that over 1,000 people attend the Movies in the Park and the Music Festival also attracts many people so he would like to see them continue. He expressed the opinion that the Town receives a lot of value for the money that is spent. Discussion ensued relative to additional funding options that could be considered other than the Contingency Fund. Councilmember Leger also concurred with the Mayor's remarks and said he was going to make a motion to restore those activities as well. He added that the only thing they might be having a difference of opinion on possibly is where the money will come from. He noted that the Town's Contingency Fund is rather low and said that they rely on those funds throughout the year. He commented that they do have a Reserve Fund -- the Downtown Strategy Fund -- and reported that there is $525,000 in that fund. He said its purpose is to enhance vibrancy in the Downtown area and monies have been used in the past for Christmas lights and other such things so he thinks it would be painless to take the funding from there rather than out of the Contingency Fund. He stated that this is another option to consider. Councilmember Yates referred to the Gross Leases (everything is included) that are out there for the Community Theater and Kiwanis and said they might need to dig to find out about the lease terms -- are they on month-to-month basis or are they in the middle of a long-term lease? Raymond Rees, the Town’s Facilities/Environmental Supervisor, addressed the Council and noted that the lease for the Community Theater is a five-year lease each term, renewable every March. He said the leases started in 2010 and 2015 will be the next lease. He advised that he doesn't have a copy of the lease with him but it should be renewed this year. He further stated that the one for the Kiwanis Club is for 25 years and that started in 1994. Councilmember Yates asked whether the renewal is automatic or does it have to be ratified and was advised that the organizations are required to send in a request for a new lease and then it would be ratified. Mr. Rees also clarified that the Town does not pay for everything; for the Theater as they pay for the major repairs on the buildings, the roofs, HVAC, water coming into the building but the organizations are responsible for minor repairs inside the buildings and any changes that they would like to do. He added that for the Kiwanis Club the Town takes care of all of the electric (utility bills) and their water. Councilmember Yates commented that since the Town is allowing the organizations to utilize the buildings for $1.00 he would like to look int o restructuring the leases into Triple Net Leases, where the tenant pays for everything in lieu of the roof or if they set aside a certain amount of money, as Councilmember Magazine commented, that maintenance could be readjusted based on history. Councilmember Hansen advised that if they are going to start doing those calculations, she would suggest that they include incorporating all of the improvements that both groups have made to the respective buildings as far as improving the value of those buildings. Vice Mayor Brown concurred with Councilmember Hansen's comment and stated that they need to take a hard look at the dollars that have been spent in improvements. He pointed out that eight or nine years ago the group took the old Community Theater over and completely revised it (it didn't have a fire protection system, the electrical system was archaic, the entire building was on the verge of needing to be torn down) and noted that the Community Theater came z:\council packets\2015\r150507\150421m.docx Page 3 of 17 in and virtually rebuilt the entire building. He stressed the importance of taking this into consideration when this is being looked at. In response to a question from Mayor Kavanagh relative to major improvements that have been made this year, Mr. Rees reported that some repairs have been made to the roof and the awning over the front of the Theater. He stated that no improvements were made to the parking lot. Mr. Buchanan confirmed that the Town is responsible for maintaining the parking lot and informed the Council that some maintenance on it was requested and that work was deferred because the same type of work is needed in the parking lots in the parks as well and right now they just don't have that kind of money. He stated that they will have to prioritize the work and do the top priorities first. Councilmember Magazine asked whether he was correct in saying that the Town paid approximately $10,000 to repair the Kiwanis Club's parking lot and Mr. Rees responded not in past years. Vice Mayor Brown mentioned that if the old Community Center was still there and totally vacant, it would be deteriorating at a rapid rate and they wouldn't be talking about replacing the roof or a little bit of roof tile, those things are just normal wear and tear, they would be talking major work or demolition. He further stated that if the building wasn't there it might lease out to somebody but that is a big might. Mr. Buchanan pointed out that Public Safety represents over 50% of the Town's Operating Budget and the budget deficit needed to come from other departments so they wound up having to do an additional 5% expenditure reduction (in addition to what had already been done) in order to balance the budget. He said that unfortunately removing Movies in the Park and the Music Festival as well as some of the other things on the list happened because of the additional budget education required. Councilmember Magazine recommended that the Council vote on restoring the funds for Movies in the Park and the Music Festival and Mr. Buchanan suggested that the motions be made at the end of the presentation because the Council will want to hear public comment on these items as well. In response to a question from Councilmember Yates, Mr. Buchanan confirmed that every department cut an additional 5% from their already bone-dry budgets. Mr. Buchanan continued with remarks relative to the Budget Summary. * Debt Overview Outstanding Bonds as of 7/1/15 * Operational Priorities FY 15-16 * Operational Priorities Addressed in the Budget * Strategic Plan Goals FY 2015-16 * Strategic Plan Goals Addressed in the Budget * Town Manager's FY 15-16 Budget Proposal ($37,954,031) * Previous Fiscal Years' Budgets * Budget Highlights * Core Services/Departmental Budgets * Projects From the Capital Improvement Projects (CIP) List that were Removed and Deferred to the FY 16-17 budget * Summary of Changes * General Fund Operating Budgets * FY 2015-16 Budget by Core Services from All Funds * Reserve Funds (Fund Balances) * 5-Year General Fund Revenue Projections * Operational Priority: Pavement Management Program * General Fund Revenues & Expenditures for Years 2007 through 2020 z:\council packets\2015\r150507\150421m.docx Page 4 of 17 Councilmember Magazine said he knows that staff estimates the revenues and asked what the basis is for coming up with the expenditure figures. Mr. Buchanan responded that those range from water increases to electrical costs to public safety. * Comparison of FY 14-15 General Fund Operating Cost Per 1,000 Citizens Councilmember Yates commented on the low cost per capita in Town and said that that is absolutely incredible for the type of services they provide in Fountain Hills. He added that considering what little they have, staff is doing an amazing job getting the most out of the dollars that are available. * FY 15-16 General Fund Operating Revenues * Town Organizational Chart Councilmember Magazine advised that he has only been on the Council a few months but it didn't take him long to find out that they had an astonishing staff at Town Hall and commended them on their professionalism and willingness to pitch in and get the job done especially during lean years. * Public Safety -- Fire Department Fire & Emergency Medical Fire Services Budget Highlights Fire & Emergency Programs * Public Safety -- Law Enforcement Law Enforcement/Divisions * Municipal Court Magistrate's Court Budget Highlights Municipal Court Budget Highlights In response to a question from Vice Mayor Brown relative to the CARE Program, Fire Chief Randy Roberts addressed the Council and stated that they have had about seven years experience now with their crisis team and the first five years were totally volunteer and over the last two years they have had a part-time coordinator paid through Rural Metro. He noted that the volunteer group was diminishing to the point where responses were not being responded to adequately and their coordinator resigned last month so this is a chance for them to re -create the program and bring it back as a totally volunteer program. He added that he thinks they could make it easier for vol unteers to be part of the program and cover what they need to do to keep it totally volunteer and that will save about $30,000. Councilmember Hansen stated that when they had some of the Law Enforcement discussions in previous months, one of the things that came up was their work schedules and how they were working longer schedules as an incentive because they weren't able to get raises. She questioned whether they are still on that type of schedule. Mr. Buchanan responded yes, they are and noted that they reserve the right on that per their agreement, so that is their call. Councilmember Magazine asked whether the start-up cost for the new Environmental Fee will be a one-time cost and Finance Director Craig Rudolphy said that right now they don't know and they are going out for an RFP (Request For Proposals) to solicit vendors and he doesn't have any cost ideas as far as what it would be on a recurring basis. Councilmember Magazine commented that one would think that the start-up costs would be higher than the annual continuation of the program. Mr. Rudolphy clarified for the Mayor that they are talking about just the start -up cost for the program and added that staff was not planning to purchase any software. Mr. Buchanan explained that initiall y they were looking at doing it in-house and that was why they talked about software but staff feels that doing it contractually will be much cheaper than in-house on an annual basis. In response to a question from Councilmember Magazine, Finance Director Craig Rudolphy confirmed that assuming the cost will be approximately $80,000 annually; this should raise approximately $500,000. z:\council packets\2015\r150507\150421m.docx Page 5 of 17 * Budget Summaries Administration Councilmember Magazine advised that he would like to speak to the Food Bank issue and said that he had the pleasure of meeting with the head of the Food Bank to discuss a number of issues and rumors (rumors such as "a substantial amount of the folks who are taking advantage of the Food Bank are from outside of Fountain Hills.)" He said tha t he was provided a Quarterly Report and he can now report that that is not true -- there are many, many Fountain Hills' residents taking advantage of the Food Bank. He further stated that until present, none of the members of the Board of the Food Bank have lived in Town and Dave indicated to Councilmember Magazine that one of them was moving to Fountain Hills. He indicated support for the proposed funding for the Food Bank and suggested that the Council convey to them that they would expect them to increase their Board to include at least two residents of Fountain Hills. He stated the opinion that if they are going to continue to support them and fund them, the Town should be well represented on the Board by people who live in Town. Mayor Kavanagh stated that they could discuss that with Dave and ask whether he would be amenable to that. She pointed out that he has done a lot to raise money on his own and said they do a great job with their Friday Fish Fry, they go to all the Fairs and all of the people who work there are volunteers. She pointed out that Max's Community Closet is run by volunteers. She added that all of the money that goes to them goes right to the people in Town. Mr. Buchanan indicated that he has made a note to follow up on Councilmember Magazine's comment and suggestion. Mayor Kavanagh commented that she knows their IT Administrator used to have another staff member who used to assist. Mr. Buchanan advised that that is Bea and she still does double duty (wears two hats -- and more). * Economic Development - Planning Approach Objectives & Goals/Priorities Strategies Discussion ensued relative to possible grants and the fact that if they are received, funding would be used to attract people to the Town's golf courses; the fact that if they do not receive the grants, that will not affect tourism efforts but the extra money would allow the Town to do more; Councilmember Magazine's comment that Mr. Mood had indicated to him that he was going to go out to bid to extend the electricity for tree lighting from Town Hall to Saguaro and Mr. Buchanan's comment that the money for that would come from a transfer from the Downtown Strategy Fund (but whether or not they proceed with those projects has yet to be determined by the Council); Mayor Kavanagh's desire to discuss the Economic Development's 80% and advised that she has some reservations about the amount of money coming out of this fund; the fact that the Mayor sat down with the Economic Development Specialist, Scott Cooper, and Finance Director Craig Rudolphy and they did some numbers because she wanted to know bottom line, after everything comes out of Mr. Cooper's budget, what is actually left for him to do marketing; Mayor Kavanagh's surprise that Mr. Cooper will be left with $17,000 to market the Town for the next year; the fact that Mr. Cooper advised that the money would allow him to do a little locally but not much, he cannot do any type of regional marketing; the Mayor's concern because right now Economic Development is their best tool and Mr. Cooper is doing a great job bringing businesses into Town but $17,000 will do very little to let anyone know that Fountain Hills is here; and the Mayor’s comment that she is looking at the $35,000 going to the Theater and wondering if maybe they could consider reducing that because the total amount that goes to the Theater is $63,000 (perhaps they could reduce that amount and give Mr. Cooper a little more money to work with as far as Economic Development goes). Mr. Buchanan noted that that is his proposal and the Mayor indicated that she would like to open it up for discussion and see whether anyone considers $17,000 to be sufficient for marketing the Town for an entire year. Discussion continued regarding the comment that every time they need some money they pull it out of that fund and the fund is supposed to be just for Economic Development; Councilmember Magazine's statement that he shares the Mayor's concern and the fact that the Council has established Economic Development as one of the Town's top two priorities, the other being maintenance of the roads and so on; Councilmember Magazine’s observation that for some time now, the Council has been pushing Economic Development and the fact that as previous members of the SPAC (Strategic Planning Advisory Commission), he and Councilmember DePorter were intimately involved in putting z:\council packets\2015\r150507\150421m.docx Page 6 of 17 together the Implementation Plan for Economic Development. He stated the opinion that not only should they be marketing in the Valley, they should be marketing throughout the State and maybe other parts of the country. Councilmember Magazine brought up Canada and the fact that the Town gets so many visitors from there and many are thinking about retiring in Fountain Hills, moving here, possibly moving small businesses here; the fact that their priority is to try and increase the population of the Town in an effort to generate more sales tax revenue and increase the number of small businesses that might have executives who make good incomes and have children to enroll in the schools. Councilmember Magazine's remarked that he doesn't understand how they could make something such a top priority and then allocate such inadequate funding in terms of doing something. Councilmember DePorter commented that he was surprised that the Town's Community Partners did not feel the same brunt of that budget reduction and although he knows it would be small dollars in the whole scheme of things, as partners in the community the responsibility is also on them to be giving back and bear some of the brunt of that weight. He pointed out that there are things that staff/departments cannot do because they just don't have the financial resources and that it was his opinion that they should all bear that weight and that will involve having conversations with those Community Partners (he does not know what that would add up to but it would be fair for everyone to bear that weight no matter what the amount). Councilmember Hansen commented that the Council seems to have this discussion annually so she thinks it is important to just say that they can't lump all these different things together and paint them with the same brush -- they have to look at each one and decide how they are benefitting the community. She stated that she looks down the list and she sees JumpStartBiz and it is $4,500. She questioned how many businesses have actually been created because of this expenditure. She added that there is something she has to do because she does it every year and that is bring up the GPEC (Greater Phoenix Economic Council) fees, the dues, which amount to over $11,000. She noted that they hear every year how valuable this is and how it gives the Town so many tools to work with but asked whether they can point to specific businesses that have resulted from that. She further stated that if they are going to talk about the Theater, she thinks that is one entity that they can measure when it shows how many people from the ou tside it attracts and brings to the community. She reiterated that each one of the entities have to be looked at on an individual basis to see what they are really bringing to the community. Councilmember Magazine said that this has been such a contentious issue in the past and that is why he prepared the following statement, which he would like to read into the record. He added that first he wanted to touch on the Theater and expressed the opinion that some of them seem to view it as an "all or nothing situation -- if they cut the money then they won't have those people coming into Town" and advised that he just doesn't believe that is correct. His statement read as follows: "Because funding the Theater has been so controversial before I joined the Council, I have given this year's funding level considerable thought. Let me say out the outset that my position has absolutely nothing to do with what has happened in the past or with personalities and positions that have preceded me on the Council. I would like to think that I am capable of carefully reviewing the facts and coming to a considered opinion and if not, I shouldn't be sitting here. We can bury our heads in the sand or we can look at our financial situation squarely. Let me say that I admire how previous Councils and our Town Manager have handled our finances; they have done an incredible job under very difficult circumstances. I take no credit for it, I wasn't sitting here and I think the past Council and the Town Manager have done an outstanding job and here is what I see. The Council has established our operational priorities -- the ones we absolutely must fund above everything else. I won't go through all of them; Ken has them up on the slide. Economic Implementation was No. 1 on that slide, Pavement Management, Fire Station #2 Relocation and so on. Now let's consider some costs. Public Safety costs between FY 01 through the present have increased 54.2% while the General Fund has increased only 25.7%. This year alone, Fire and Police are costing us more than $400,000 more than last year. Public Safety is 52% of our budget. I don't want to leave the impression that the service we are getting is not worth the cost, it definitely is, our Fire and Police do a superb job b ut we must recognize that the continued costs are part of our future as shown on the slide that I questioned Ken about with the fixed costs throughout the next several years. Road Maintenance -- the 2009 Stantec Report indicated that we should be spending $3 million plus on road maintenance and replacement. The Council last year decided to put aside $1 million -- we simply don't have the funds to keep pace with these core services, which is all indicated in the slides that Ken went over. Zone 1 as an example is already falling behind because of costs. It was reported at the last Council meeting I believe that inspection shows that parts of Zone 1 not only need maintenance, they need replacement, and we don't z:\council packets\2015\r150507\150421m.docx Page 7 of 17 have the money for it. State Shared Revenues are 35% of the budget. Ken mentioned that our share might go down over time. Well, it's 35% of the budget and we've read in the local press that Mesa, Chandler and maybe other communities are going to be paying for a mid-decade census. In one case I think it said that Chandler would be paying about $3 million to do a census but they will be taking in about $5 million per year as a result of it because their population has exploded. Ours has stayed absolutely static and therefore, given the way the State Shared Revenues are apportioned, our share is going to go down -- there is no question about that and it could go down a lot. So 35% of the budget could be diminished as a result of this. The State has passed on to us in order to pay the State Department of Revenue a cost to implement the new TPT law, we don't know how much, but it is more money. Water rates are predicted to double because of system improvements and there are always unanticipated costs. I could go on but I will spare you more details -- there are a lot more details and a lot more things that we should be concerned about. If this were a household budget, we wouldn't be planning a costly vacation or a new car. The time has come to re-examine promises made in the past, we can no longer afford some of what we have supported in past years and optics count. When our citizens see that we are beginning to fall behind on core services and are faced with skyrocketing costs and increased budget adjustments, spending money on 'nice to have' projects, amenities and services creates a jaundiced view of our Town government. Folks, we cannot grow our way out of this financial predicament. Everyone needs to be part of the solution and that is why I cannot in good conscience support the full amount recommended in the budget for the Theater. I for one am not in favor of eliminating the budget for the Theater, I think there is room to trim it some or half it and put it towards some of these other uses that we are talking about. I don't do this lightly, I know that the Theater has tremendous support and I know that a lot of people attend the Theater. I think it is wonderful and I think it is wonderful for the community, I should have said that right up front, but we simply can't do everything. Thank you." Mayor Kavanagh asked whether Councilmember Magazine had a number in mind and he said yes, he would consider setting it $50,000 total, down from $63,000. Mayor Kavanagh advised that she was listening to what Councilmember Magazine just said and looking at the Theater budget and they seem to have a very healthy revenue stream, their revenue listed on the sheet they gave the Council showed $507,000 in revenue and they do seem to be a little on the heavy side when it comes to salaries, $215,000. She expressed the opinion that perhaps to make up that small amount that Councilmember Magazine is talking about, the Theater should do what the Town just did and maybe cut back on personnel who have to be paid and look more to volunteers. She said it might be easier to make the up if they did that. She added that of course the Town is always willing to help by giving in-kind donations to any of the groups if that would help. Councilmember Leger stated that he certainly agrees with what he has heard this evening in terms of Community Partners perhaps contributing 5% or 10% more but to the conversation they just heard from Councilmember Magazine, they certainly need to make these cuts and they need to be frugal. He stated that cutting the Theater or other organizations by $5,000 is not going to address the issue that he is talking about. He added that he has heard this several times from Councilmember Magazine and he is wondering what his solution is because they are now being penny wise and dollar foolish so he suggested that they just put it all out on the table. He commented that they all know that sitting here and managing budgets year in and year out has been difficult and most years there was a little moisture left in the sponge but this year there's not and there's not much that they can squeeze out of it so they are up there playing musical chairs. He advised that he is all in for cutting the 5% or goi ng back and equalizing it at $50,000 but suggested that they look at the value that their partners bring to the table and start working with our partners rather than working against them. He further stated that he just heard a diatribe on Economic Development and if anyone on the dais thinks that that is a silver bullet given the capacity they have in this Town they are fooling themselves. He noted that they brought an Economic Development person on board full time and a Tourism person on full time and comparing last year's Economic Development budget to this year it has increased by 28% and Tourism has been increased by 10%. He pointed out that Tourism and Economic Development go hand -in-hand and they are saying that they need extra money for marketing in terms of Economic Development and stated that he doesn't argue that but the bottom line is that they are growing these particular workings that have gone from part time to full time and he would like to see a little ROI (Return on Investment) before he starts investing more money in either of those departments. He commented that what is interesting is when the SPAC proposed Economic Development, it was an unfunded mandate and what Council did was develop a strategy for funding both of these programs. He added that he is happy to see in their budget this year that they have their own cost centers and those are kind of incentive based if you think about it because both are funded through sales tax revenue. He reiterated that he can see where this is going and if they want to cut back here and there 5% or 10% that is all fine and good but they should look at what they need to do z:\council packets\2015\r150507\150421m.docx Page 8 of 17 in FY 16-17 when they have real issues, they need to have a discussion about revenue solutions, the time is now. He urged the Council not to beat up their partners and said that when they look at Economic Development and they look at marketing, oftentimes it is a shot in the dark and they don't know what they are going to get for their marketing dollars. He noted that social media hits here and hits there and that's all fine and good but he doesn't see anything materializing from that. He noted that what they do know about their Theater is that it does attract tourists and adds value to Economic Development and to their businesses because more people are coming to Town to see the shows and use the Theater. He restated that there is a bigger discussion here and they have to stop trying to balance their budget on the backs of their Community Partners, there is a much bigger issue that needs to be addressed. Mayor Kavanagh asked Councilmember Magazine if the Council reduces the Theater funding to $50,000, which would actually bring it into line with the Town's other partner, would the $13,000 difference then be added to the $17,000 and given to Mr. Cooper for Economic Development purposes and Councilmember Magazine replied yes. Councilmember Magazine stated that he is very sorry that Councilmember Leger characterized his comments on Economic Development as a diatribe and added that as he recalls, the Council voted unanimously in favor of the Implementation Plan for Economic Development and he was sitting there when everyone was extolling the virtues of Economic Development and how they needed to generate more small business, population and so forth and he never ever used the term or described it as a "silver bullet." He advised that he has described it as "an arrow in their quiver" and it is one of many things they need to do to improve and grow this Town. He said that it is a little unsettling to hear these words thrown back at him when in fact Council basically said the same things he just did when they approved the Plan. He added that secondly, it is not $5,000 it is $14,000 or at least that is what he mentioned and lastly, he kee ps talking about optics and he thinks it is critically important. He pointed out that he knows Councilmember Leger would like to increase the income of the Town as would all of them but when the SPAC had a joint meeting with the Council, twice he, as a member of the SPAC, raised the issue of optics -- how do they tell the public that they have financial problems and deficits as far as the eye can see, that they are going to have a $700,000 deficit in two years and that doesn't include losing State Shared Revenues and any other costs. He questioned how they tell the people that and at the same time fund some of the things that they fund. He noted that he is not singling out the Theater -- he thinks there are other things they need to look at because they need to reduce their spending or they will be asking for very serious trouble. Vice Mayor Brown advised that there is quite a bit of doom and gloom going on tonight and stated that he would like everyone to remember that this Town has pretty much been fi nanced and built on the backs of the general contractors and developers of this Town. He said they had a depression, call it a recession if you may, and construction almost shut completely off. He added that through the blessings of God he survived that and what he is seeing happening in the Town is not only amazing, it is very encouraging. He pointed out that they have managed this budget now for about eight years without any more income coming in and their Town has survived. He stated the opinion that this Town will continue to survive whether they have a Theater, Movies in the Park and all of the other amenities, that is all going to happen, but what he is trying to say is that this Town is getting ready to experience another growth streak and he is extremely optimistic about it. He said that he has been in the industry, he has followed it very closely, and he is watching the number of permits that are coming in and the new developments. He noted that they are talking about doing a Downtown project that is in Review right now, somewhere around $180 million if they can bring it all together and that will happen in the next three years at most. He further advised that they are looking at putting in a new Assisted Living Facility out on Saguaro and Trevino and it is one of the most well thought out, beautiful projects that they have seen in the longest time. He announced that they are looking at Adero Canyon and thanks to MCO and their patience Adero Canyon is coming on line and it is going to be one of the hottest projects he thinks in Arizona. He said that Silverleaf is going to be built out and there isn't any more property like it except when you come into Fountain Hills and look at Adero Canyon, Sunridge Canyon and the few lots they have left in Fi rerock. He pointed out that they have Parcel B, which is being developed by Toll Brothers. He explained that Parcel B is a 58 -lot subdivision that the Council approved about four months ago and they are progressing very nicely on their plans and will be out of the ground clearly around the second quarter of 2016. He commented that these are all projects that are going to bring money into this Town for the first time in eight years so they need to be looking forward and saying that they are going to make it through this last tough uphill battle and then they are going to be smarter about the way they finance their Town because when construction is over with, it is going to be just like it has been for the last eight years. They need to plan for that. He pointed out that they need to be looking forward to coming out of this depression, moving forward with this Town and making this Town a happy, good place to be and it is; it is incredibly wonderful. z:\council packets\2015\r150507\150421m.docx Page 9 of 17 Vice Mayor Brown further stated that to the point of the Theater, which had nothing to do with his comment on the Theater, he is just tired of hearing how this Town is not going to make it, it's struggling. He said darn right it is struggling, dramatically, but they are going to come through it once again on the backs of some developers and contractors but they will make it so they have to all pull together on it. He added that as far as the Theater, just as the comment was made about attracting kids and young people from out-of-Town for three or four nights a week for Movies in the Park and the Music Festival, it is almost every weekend, the parking lot is full in front of the Theater. He commented that to Councilmember Yates' point they are getting a tremendous break on the building and they are getting a little more than everybody else and he can see a portion of that going into Economic Development but he doesn't think they need to just arbitrarily take 30% out and he will not support that. He added that he can see taking a portion of the proceeds that they are now focusing on the Theater and putting it into Economic Development because that in turn will bring more people to Town. Councilmember Yates said that everyone has valid points but collectively this group of expenses is less than 2/10ths of 1% in the scheme of things but the 5% cut makes sense. He agreed that Economic Development is not a silver bullet as they always say but they all know that the amount of retail sales that are going over the mountain far exceeds $3 million so he thinks that is worth investing in. He added that $15,000 for Economic Development isn't even a drop in the bucket as far as what it should be -- as everyone knows, particularly Mr. Buchanan, the budget for most Economic Development groups in other municipalities exceeds hundreds of thousands of dollars so an extra $2,000 or $3,000 won't fix the issue although he knows Mr. Cooper would stretch it. He indicated support for the 5% and stated that Economic Development needs to be invested in every year -- it is part of the pie and they still need to address revenue but they should consider making this a little bit higher priority than what he thinks some of them are saying. Mayor Kavanagh advised that she knows the Boys & Girls Club had asked for approximately $60,000 and that the budget had stated $51,000, so they had taken a reduction from what they requested. She stated that she doesn't see any reason why they can't reduce funding for the Theater and then put the money into the Economic Development fund. She pointed out that it may be a small amount but Mr. Cooper will get the most out of every penny. She further commented that one of the reasons she is such a big fan of Movies in the Park and the Music Festival is because they are free -- they are the only free events that they offer to the people except the ballet and the Town has to pay $10,000 to have them come to Town and perform. She said that she would like to continue to provide these free events and noted that if people go to the Theater they do have to buy tickets so there is a cost associated with that and there are some families that can't afford to go. She noted that as Councilmember Magazine pointed out there are a lot of residents who use the Food Bank so she doesn't think those people have money as liquid as some other people. She requested that Mr. Buchanan make a note of Councilmember Magazine's proposal and continue on with the presentation. Councilmember Hansen pointed out that they can't compare all of the partners with o ne brush and the Theater does stand out as the one group that does attract the most people to Town and every time they market the Theater they are marketing Fountain Hills. She advised that it has a proven record of bringing dollars into the Town and the other partners have different purposes like helping the hungry, the Boys & Girls Club provides programs for the kids, etc., and it is an ongoing, month-after-month benefit to the Town with the people that it does bring to their restaurants, retail stores and gas stations. Councilmember Magazine asked whether any members of the Council really believe that reducing funding in the amount that he mentioned is going to result in the Theater closing its doors and will stop people from coming to Town and using the restaurants, gas stations, etc., because he for one does not believe that for a minute. He expressed the opinion that nothing is going to change and emphasized that the Theater is great and has a fantastic reputation and they will tighten their belts and find other ways to raise more money just like every other organization that is going through this. He added that he just doesn't see how the argument holds water that they do so much for the Town so the Council should be very careful about how they deal with them -- they will continue and they will flourish. Mr. Buchanan continued on with his presentation. * Development Services -Organizational Chart, Divisions, Programs, Funds, Budget Highlights Vice Mayor Brown advised that he doesn't know what this will look like but he has pretty well explained himself as far as he thinks what Fountain Hills can do in the year starting 2016 with the number of projects that are coming on line. z:\council packets\2015\r150507\150421m.docx Page 10 of 17 He asked if there was any way that they could take a portion of the Permit Fee that is being paid and set it aside to help staff, such as the Permit Tech, the Building Official, the Engineering & Planning Departments that are going to be having to handle this workload. Mr. Buchanan replied that the basic answer is no, because that is a general revenue source that is in the General Fund and they would be robbing Peter to pay Paul. Vice Mayor Brown said that if this takes off like it has aligned itself to they don't have enough money in the budget to even take care of their own inspections. Mr. Buchanan noted the two positions amounted to $152,000 and stated that they would have to find some place in the budget to reduce and that would be a significant change. Vice Mayor Brown advised that he is asking if they can think outside of the box a little bit because the builders and developers are paying for a service that they are not get ting -- now they are, they are doing great right now, the staff is hanging in there and doing a good job -- but if in fact they started issuing a triple amount of permits he doesn't know what they would do. Mr. Buchanan responded that staff looked at the numbers hard and he doesn't know that they are going to do triple the amount and he doesn't have an answer for the Vice Mayor because there is no money unless he wants to rob Peter to pay Paul. He stated that one of his highest priorities was to find a way to get them some more staff members but with the kind of number that is sitting out there for the costs he doesn't know how to do that. Vice Mayor Brown noted that this could get to be a real problem for the Town down the road. * Community Services - Organization Chart, Activities, Budget Highlights Councilmember Hansen asked whether the Avenue medians got moved and Mr. Buchanan replied yes, they were moved from Streets Operations to the Parks Department this year (Parks will take it over July 1st). * Capital Improvement Plan (CIP) - $14,276,350 - Proposals/Projects Councilmember Yates commented on the fact that every year they balance the budget but the reality is that deferred maintenance, replacement reserve and operational shortages are not being shared with the residents (per Councilmember Magazine's previous comment about how do they get the word out that finances are in trouble). He said he is almost thinking that they need another line item to show yes, the budget is balanced but this is what is really needed (the shortage). He stated that for a minute they should pretend that all of their Capital Improvement Projects are fully funded and the streets are in good shape and asked what kind of a shortage they are looking at on an annualized basis right now, just on maintenance to maintain what they have (he believes it is between $3 and $5 million). Mr. Buchanan responded that they are still using a 2009 study on roads for numbers and staff tried to find money in the budget to pay for an updated report but it just was not there. He noted that in the older areas of Town they are looking at streets that are beyond maintenance. He reported that they are looking at creating another fund for asphalt replacement and by 2020 they will hopefully have another million dollars that will only be responsible for the replacement of asphalt, to include that other million for maintenance. He added that he doesn't know whether it will still be behind and stressed the importance of getting another Stantec report. Councilmember Yates asked whether Mr. Buchanan could throw out a number that shows what the shortfalls are and Mr. Buchanan stated that he doesn't have the expertise to do that (customarily, cities across the board bring in a consultant and get a Cost of Service Report). He noted that those are very expensive to do but that is the information that they really need and neither he nor staff have the expertise to give the Council that kind of data. He noted that the last Stantec Report stated that the Town needs $3 million a year just to stay on top of the on-going maintenance programs for what they already have. He added that the report also said that they better start replacing asphalt out there and in order to do that, they put together a bond issue that was unsuccessful to address those roads. He said that they had to re-group and they had to incrimentalize that going forward so they took specific projects. He noted that they are going to need another bond issue in the 2020s -- 2022 or somewhere around there to start looking at those old streets. He emphasized that they are still looking at the $3 million that they really need and right now they have eked z:\council packets\2015\r150507\150421m.docx Page 11 of 17 out every cent they could to tell the Council what staff thinks they could get for the Pavement Management Program (a $2 million project) in 2020. Councilmember Magazine said that as he mentioned earlier in the meeting there are also the unforeseen things -- a new liner for the lake, they have 40-year old pumps out there and he would assume that they are talking mega millions of dollars and Mr. Buchanan concurred. Mayor Kavanagh asked whether they had removed the pump design and Mr. Buchanan said no, that was for a distribution system that would bring effluent over for Golden Eagle -- right now it's on another property and they wanted to put in on the Town's property. Councilmember Leger stated that he would guess the answer to Councilmember Yates' question is "a lot of money" and in 2006 they did a Strategic Plan and projections that indicated what they would need in FY 2014-15. He added that they have managed their budget and are now looking at a deficit in 2016-17. He commented that the point he was trying to make earlier in responding to Councilmember Magazine's comments is that "they kno w -- they have been wrestling with this year in and year out." He said that he is simply asking what the solution is -- he keeps hearing what the issues are but he wants to know what the solution is and that is what he wants to talk about. He further sta ted that his point was that they nickel and dime themselves and there is this fantasy out there that Economic Development is the solution. He noted that he said it was not the silver bullet, not that anyone else had said that , and agreed that Economic Development and Tourism is an important component of a diverse revenue portfolio and added that he supports Economic Development and they have increased ED's budget by 28% over the last year and increased the budget by 10 to 12%. He reiterated that he favors those programs but they are at the point now where they are getting into more ideological discussions that are disguised in funding this and funding that. He said that he doesn't need any more lectures and if someone is going to talk about the dire state of the Town he wants to hear the solutions. He further stated that Councilmember Magazine's comments were thoughtful and he appreciates them and respects them but they are not going to get there by cutting $5,000 here and $5,000 there, it is just not goi ng to happen, so he just wanted to clarify that he is looking for solutions, they all know where they are at and respectfully, to Vice Mayor Brown's response, this is an awesome Town, they are in very good shape and their issues are no different than any other municipality. He reported that Scottsdale, which seems to be rolling in money, has the same issues regarding facilities and roads -- welcome to the world of municipal government, it's not perfect and their streets will never be perfect and ideally they will do the best they can with what they have and that is what they are doing (they need a solution other than just Economic Development). Councilmember Magazine advised that Mr. Mood had indicated to him that on the drainage projects they went from a four-year cycle to a seven-year cycle and Mr. Buchanan clarified that the seven years refers to Pavement Maintenance and he is not sure what it is for the drainage projects/wash, he doesn't think there is a cycle for that. Mr. Mood addressed the Council and reported that the asphalt is on a ten-year cycle and if Councilmember Magazine is talking about wash maintenance that is on a four-year cycle. He stated that there was a time in FY 2009-10 when it got defunded (before he joined the Town) and that pushed them back to a seven -year cycle. He informed the Council that staff is starting to take pictures before and after the work they just did and they are going to document and they will do that every year and he can almost guarantee that after one year it will be full grown in there again. He stated that they can keep on that four-year cycle. Mayor Kavanagh referred to the Miscellaneous Drainage Projects in the packet and asked if those are the drainage ditches that run through Town and Mr. Mood responded no. He explained that staff brought a 5 -year contract to Council recently and they are doing that work right now -- it is part of the Environmental Fee. He stated that a good example is at LaMontana and Segundo where there used to be a large wide open area, a wash, and staff used some of the $50,000 to extend the culvert and bring some dirt in and cover it up. He added that t hese are more permanent drainage-type improvements, not maintenance or vegetation. * Fee Schedule Changes/Explanations Mayor Kavanagh noted that on the Fee Schedule page some of the fees are less and some were added and Mr. Buchanan concurred with her statement. z:\council packets\2015\r150507\150421m.docx Page 12 of 17 Councilmember Hansen asked if Mr. Buchanan could share a little more on the discussion about charging for the Avenue and stated that on Pages 95 and 96 there are two different rates for the Avenue but it doesn't say why they are different. She pointed out that the one on Page 96 says that a 4-hour minimum on the Avenue Plaza rental is $112.50 per hour for each section but on Page 95, the same 3-hour minimum is $75 per hour each section. Director of Community Services Mark Mayer addressed the Council and explained that they have two sets of fees depending on whether users are residents or non-residents and of course residents pay the lower amount. Councilmember Hansen advised that they always have discussions about how they can attract more eve nts and get groups to sponsor them and the Farmer's Market comes to mind because that was one of the first ones to start doing that. She asked whether the different pricing is taking away the incentive to have groups host these types of events by charging or are they comfortable with that. She added that she doesn't remember having a dialogue about how and what they would charge for the medians. Mr. Mayer stated that that is why staff proposed the new fee and noted that the methodology he used was that t hey have two other facilities that they would typically rent out, the Amphitheater and Centennial Circle, and the fees that are being proposed for the Avenue are exactly the same as the fees being charged at those two facilities. He pointed out that this provides people coming into a Town a choice of different venues to use and they would base their decision on what the best venue was for them rather than what was the cheapest price. He said that Council can set those fees at any price they want and reminded the Council that they do have another Avenue and because of the recently revised Sponsorship & Naming Rights Policy, they do have the options of either reducing or eliminating fees by going through that procedure as well. Councilmember Hansen commented that she thought this might be something that the Council wants to talk about down the line and further stated that they don't want to deter anybody from bringing anyone here. Councilmember Magazine noted that out of all of the fees it appears that only three maybe have been changed, some up and some down, and said that he assumes there is a different methodology for each one. He questioned how they determine these and how often they are looked at to determine whether they warrant changes. Mr. Buchanan replied that they are reviewed on an annual basis. He added that staff tries to keep them as cost effective as they can but there is also cost to the Town as an organization that they need to consider. * Personnel - Number of FTE Employees, Benefits * Two Budget Resolutions Mr. Buchanan informed the Council that adoption of the Budget will be accomplished through the adoption of two Resolutions (one adopts it and the other clarifies the parameters of administering it). Mr. Buchanan recommended that the Council approve the proposed FY 2015-16 Budget in the amount of $37,954,031. Mr. Buchanan indicated his willingness to respond to any questions, said that this will be the time for the Council to take public comment and added that they can then have discussion on the three items that he has made notes on based on the Council's discussion. Councilmember Magazine referred to the $40,000 in the budget for on-line payments and requested some information on this item. Mr. Buchanan explained that that is for the website/on-line payment software and advised that in the past the residents had to come into Town Hall to make payments or mail them in. Councilmember Magazine pointed out that that system worked for a number of years and Mr. Buchanan agreed but stated that they are trying to focus on providing the best customer service for the residents. He added that time is money as Vice Mayor Brown stated and if someone can pay a bill/fees on line from their desk that is a lot easier than having to come all the way down to Town Hall to pay it. z:\council packets\2015\r150507\150421m.docx Page 13 of 17 Councilmember Magazine concurred with Mr. Buchanan's statement but said that he thinks that is $40,000 that could be used in other ways. Mr. Buchanan advised that the final decision is up to the Council, this was simply his recommendation. Councilmember Magazine also pointed out that there is $60,000 in the budget for the SPAC (Strategic Planning Advisory Commission) and commented that he recalls that five years ago when they did the Comprehensive Plan, he believes Council approved $10,000 in expenditures and it cost something like $3,500. He stated that he knows there are a lot of new members on the SPAC and they have talked about the possibility of getting consulting help but that just seems like a lot of money to him and he wonders whether or not members of the SPAC could work with the consultant, hand in glove, to produce a plan, He advised that he is going to recommend that the amount be reduced to $40,000, which he thinks is still high and also to hold it in reserve until the Council knows what they are going to do with that money because they met with the group and it was pretty clear that they really didn't know h ow they were going to proceed and are going to talk about it and come back to the Council and address the methodology they used to plan. He added that he supports reducing the amount and placing the funds in reserve until they know specifically how the money is going to be used. Mayor Kavanagh requested that Mr. Buchanan add that recommendation to the list. Councilmember Leger stated that as a follow up to Councilmember Magazine's comment he would like to know whether that would come back before the Council (approving the expenditure once the details have been worked out) and Mr. Buchanan assured the Council that that would be the case. Mayor Kavanagh announced that at this time she would like to hear from the public who have patiently waited to present their remarks. Town Clerk Bevelyn Bender informed the Council that she received two speaker cards from citizens who wanted to show support for the Movies in the Park; however, one did not wish to speak and that she believed the other person had left the meeting. She indicated that there was one additional speaker. Justin Duran addressed the Council and stated that he has been part of and an employee of the Boys & Girls Club for the better part of 15 years and he is the new Branch Director in Town and has been in Fountain Hills since May. He said that he is very impressed with all of the Town staff that he has been able to work with. He noted that they have had to make some cuts in their organization as well and stated that he would like to take this opportunity to explain the Club's request for the $60,000, which is an increase from the $51,200 previously allocated. He informed the Council that the Boys & Girls Club wants to make sure that they are good partners with the Town and that they provide a high quality program here that will attract families to the Town. He advised that the Club is willing to partner with the Town as far as the Movies in the Park and supplement however they can, whether that is providing staffing, working with the Recreation staff and helping Rachael and her team. He commented that he understands where the Council is coming from and said however they can help maintain the quality atmosphere for families to encourage youth and families to come into Town is what they want to be a partner with. He added that they want to be the premier youth services for the Town and noted that Fountain Hills is a great Town and a wonderful place that people want to visit and they want to make sure that the Club is the premier youth services provider for the Town. He thanked the Council for their consideration. Mayor Kavanagh thanked Mr. Duran for his comments, said that the Council appreciates the Club's offer to give back and stated that they will take advantage of that. Jerry Butler addressed the Council and advised that he has worked with most of the staff in the Town and they are very fortunate to have them. He advised that tonight he heard several things that are a little bit confusing; the first being that there are some bright things on the horizon in the community and that is wonderful to hear. He said that he agrees with everything that Vice Mayor Brown said -- those developments are out there and coming in and the question is when. He added that on the other hand he heard that they are having some budget problems and some funding requests cannot be approved this year and he fully understands why. He commented that he would like to see a full summary from all of the departments showing the things that should be done but are not able to be funded because he thinks that is going to set the stage for the problems that this community i s facing and, as Councilmember Leger said, bring in z:\council packets\2015\r150507\150421m.docx Page 14 of 17 some solutions. He further stated that they all know what the solutions are, they need to find other sources of revenue - - there is no other answer. He noted that they have cut their community to the bone and tonight they talked about $5,000 here and $5,000 there and that is not going to solve the problem. He said that they have a wonderful community and it has been great and could even be better if the community would step forward and take control of their destiny. He stated that he appreciates and wants to thank the Council for balancing the budget, which he knows they have to do but to do it in the wonderful way that they have. He recognized the fact that this has not been easy this year, last year and most likely next year. He further stated that as far as the deficits, what he would like to know is do they include those items that have not been funded this year and didn't get funded last year that they keep putting off and emphasized that they are just going to have to come to fruition some day -- they are going to have to pay for those facilities and transportation and the streets are a big component of what they are up against. He pointed out that they can only put this work off for so long and then the cost is going to skyrocket. He said he knows they don't have that crystal ball and he has lived his life as an engineer using the WAG system and he gets it pretty good. He added that rather than spend money to have more studies done to try and figure out precisely what the cost is going to be, he says they should use the WAG system -- they are going to be low in some areas and high in others but he bets when they get done they will be right on target. He advised that as a volunteer for the community, he would like to volunteer to do whatever he can to help the staff with their WAG system. Mayor Kavanagh said that she is sure that the staff really appreciates Mr. Butler's words and thanked him for his comments. Mr. Buchanan informed the Council that he has four different areas that were brought up and indicated his intention to go through them to make sure that he accurately recorded the items. 1) The Movies in the Park and Music Festival should be included back in the Budget ($13,250 cost) 2) Request that the Food Bank increase the Board's membership by adding two Fountain Hills' residents 3) The Economic Development Fund and adding to the Business Attraction fund of $17,000 for marketing and where any, if any, additional funding should come from 4) The Strategic Plan and the website on-line payment were brought up for consideration on whether those should be eliminated or reduced (for further discussion) Mayor Kavanagh MOVED to restore funding for the Movies in the Park and Music Festival events back into the Budget and Councilmember Yates SECONDED the motion. Councilmember Leger questioned where the funds were going to come from ($13,250) and the Mayor advised that she discussed that with the staff previously and they recommended that the easiest way would be for them to either take the funds out of the Contingency Fund or the $23,000 from MCSO (Maricopa County Sheriff's Office) but their first suggestion was the Contingency Fund and since she did ask their advice she would like to go along with that and take the funding out of the Contingency Fund. Councilmember Yates supported amending the motion to reflect that the funds will come out of Contingency Funds. The motion CARRIED UNANIMOUSLY (7-0). Mr. Buchanan stated that the next item was the Economic Development fund, noting that there had been a lot of discussion and adding to the marketing side of the business attraction strategy. Mayor Kavanagh asked if Councilmember Magazine wanted to make a motion on this item. Councilmember Magazine expressed he was unclear as to how much this would be going to economic development. Mayor Kavanagh clarified that Mr. Cooper did have $17,000 to work with and this would add an additional $13,000 for a total of $30,000. Councilmember Magazine stated he thought this would require two motions; one would be to set the Town's contribution to the Theater at $50,000. z:\council packets\2015\r150507\150421m.docx Page 15 of 17 Councilmember Magazine MOVED to set the Town's contribution to the Community Theater at $50,000 and that the difference would go to economic development. Councilmember Leger asked for clarification as to how that is going to be apportioned out (the $50,000). He stated that they know that there is $28,000 coming from Community Services and $35,000 coming from the Economic Development Fund so he is curious about how that is going to be apportioned out to arrive at that figure. Mayor Kavanagh stated that she believes Councilmember Magazine said from the $35,000 with the stipulation that it be returned back to the Economic Development Fund and Councilmember Magazine concurred with the Mayor's statement. Councilmember Leger questioned what that amount would be and then advised that he believes the amount would be $13,250, which represents a 20% drop in that particular budget. Councilmember Yates SECONDED the motion. A roll call vote was taken with the following results: Councilmember Hansen Nay Vice Mayor Brown Nay Councilmember Magazine Aye Councilmember Yates Aye Councilmember Leger Nay Councilmember DePorter Nay Mayor Kavanagh Aye The motion FAILED for lack of a majority vote (4-3 with Mayor Kavanagh and Councilmembers Yates and Magazine voting Aye). Councilmember DePorter MOVED for a 10% reduction in all four Community Partner contracts (approximately $13,300). He noted that this is consistent with what they directed their internal departments to do at 5% and look to their external Community Partners to do the same. Councilmember Leger SECONDED the motion. Councilmember DePorter noted that his motion represented $450 from JumpStartBiz, $5,100 from the Boys & Girls Club, $6,300 from the Fountain Hills Community Theater, and $1,400 from the Posse. He said that he is not trying to paint them all with the same stroke but it is something that they are all going to have to bear the weight of. He added that he couldn't agree more with the comments from the other Councilmembers regarding the importance of these groups to the Town (for a total of $13,291). In response to a request for clarification from the Mayor, Councilmember DePorter said he would amend his motion to include that the funding would go back into the Economic Development fund and Councilmember Leger concurred with the amendment to the motion. Councilmember Hansen questioned whether this would represent a second reduction to the Theater's budget and Councilmember DePorter said no, he was basing it off of the request for $63,200 (10% off of that). Councilmember Hansen noted that the Theater's budget has already been reduced once by transferring some of the funds back to the Economic Development Fund. Mayor Kavanagh advised that that prior motion had failed. Councilmember Magazine pointed out that there has already been a reduction in the Boys & Girls Club's Budget. z:\council packets\2015\r150507\150421m.docx Page 16 of 17 Mr. Buchanan clarified that there was no reduction -- the funding amount this year is the same amount as was provided in last year budget but their request received this fiscal year for additional funding is not being approved (was not placed in this budget). A roll call vote was taken with the following results: Vice Mayor Brown Aye Councilmember DePorter Aye Councilmember Yates Aye Councilmember Leger Aye Councilmember Hansen Aye Councilmember Magazine Aye Mayor Kavanagh Aye The motion CARRIED UNANIMOUSLY (7-0). Mr. Buchanan stated that the next item was the Strategic Plan, was currently budgeted for $60,000. He asked for confirmation of if it was to be reduced or eliminated. Councilmember Magazine MOVED that the Strategic Plan funding be reduced from $60,000 to $40,000 and held in a reserve fund until the Council meets with the Strategic Planning Advisory Commission and talk through the methodology they are going to use. Mr. Buchanan commented that his recommendation is that the funds go back into the Contingency Fund while it is being held in reserve. Councilmember Magazine advised that he will amend his motion to include Mr. Buchanan's suggestion that the funds be placed into the Contingency Fund while being held in reserve. Councilmember Yates SECONDED the motion. Councilmember Yates Aye Councilmember DePorter Aye Councilmember Hansen Nay Vice Mayor Brown Aye Councilmember Magazine Aye Councilmember Leger Aye Mayor Kavanagh Aye The motion CARRIED BY MAJORITY VOTE (6-1) with Councilmember Hansen voting Nay. Mr. Buchanan stated that the last item was the website on-line payment in the amount of $40,000. Finance Director Rudolphy corrected the amount and stated that the number was only budgeted for $15,000. Councilmember Yates clarified that that amount was never $40,000 in the budget but was listed as $15,000 and Mr. Rudolphy concurred with his statement. Councilmember Magazine stated he withdrew is suggested reduction. Mr. Buchanan stated that no money was discussed regarding the Food Bank item; direction was to contact them and request local representation be added to their board. Councilmember Magazine stated that as far as the direction for staff to request on behalf of the Council that the Food Bank's Board of Directors be increased by two additional local residents, he would like to hear a statu s report on that within 90 days and stated that was his motion. Councilmember Yates asked whether the Council has the authority to stipulate who should serve on someone else's Board; Town Attorney Andrew McGuire advised that as a condition of funding, if it is important to the Town that the funds be administered by people who live in Town, then that is legitimate condition to put on the funding. He added that this is something that will have to be incorporated into the community contract. z:\council packets\2015\r150507\150421m.docx Page 17 of 17 Mayor Kavanagh said that if it would be okay with the other Councilmembers, she proposed that she could just talk to Dave about it and she thinks he would be really agreeable with doing that. Councilmember Magazine stated that that would be fine but if he isn't agreeable then he would like to hear about it. He indicated that he has already talked to Dave but it would be good if the Mayor reinforced that. Councilmember Leger noted the background information stated that of the current four Boardmembers, one of them lives in Fountain Hills, two live in Phoenix, and one in Mesa. He commented that if you look at their revenue sheet, and he thinks this is impressive, the Boardmembers can contribute $3,000 a year so he wouldn't want to give the wrong signal and he thinks it is overstepping their boundary to be dictating to a Board who their members should or should not be. He added, however, that he would agree that a conversation with Pastor Iverson might be helpful but he doesn't want to discourage any of the current Boardmembers (he thinks there is a $1,000 contribution coming from these individuals). Councilmember Yates concurred with Councilmember Leger; he indicated that he doesn't like becoming involved in someone else's board unless there is a huge problem and he knows how difficult it is to get volunteers so if someone is willing to help, he doesn't care where they are from. Councilmember Magazine indicated that he did not feel strongly about this one. Mayor Kavanagh indicated that she would discuss it with him and perhaps he will just add another Board seat. Mr. Buchanan reported that the bottom line numbers have not changed; the Council indicated that it was not necessary to hold the additional Special Budget Session tentatively scheduled for tomorrow evening (April 22, 2015). Mayor Kavanagh thanked all of the members of the Council for a great Budget Session and said that this wasn't easy to go through and she thinks they all did a great job. AGENDA ITEM #2 - ADJOURNMENT Vice Mayor Brown MOVED to adjourn the meeting and Councilmember Yates SECONDED the motion, which CARRIED UNANIMOUSLY (7-0). The meeting adjourned at 7:44 p.m. TOWN OF FOUNTAIN HILLS By _______________________________ Linda M. Kavanagh, Mayor ATTEST AND PREPARED BY: _________________________ Bevelyn J. Bender, Town Clerk CERTIFICATION I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Special Budget Session held by the Town Council of Fountain Hills in the Town Hall Council Chambers on the 21st day of April, 2015. I further certify that the meeting was duly called and that a quorum was present. DATED this 7th day of May, 2015. _____________________________ Bevelyn J. Bender, Town Clerk