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TOWN OF FOUNTAIN HILLS
MINUTES OF THE WORK STUDY SESSION OF THE FOUNTAIN HILLS TOWN COUNCIL
APRIL 16, 1991
A public work study session of the Fountain Hills Town Council was convened and
called to order by Mayor John Cutillo at 6:30 p.m., Tuesday, April 16, 1991, in
the conference room of the Town Hall Offices located at 16836 E. Palisades,
Building C, Fountain Hills, Arizona.
ROLL CALL - Present for the meeting were the following members of the Fountain
Hills Town Council: Mayor John Cutillo, Vice Mayor Frank Clark and
Councilmembers Peg Tibbetts, Mike Minarsich, Charlie Fox, Wally Hudson and Bill
O'Brien. Also present were Town Manager Paul Nordin, Director of Community
Development Gary Jeppson, Town Attorney Bill Farrell, Mr. Nick Dotterman and Town
Clerk Cassie Hansen.
AGENDA ITEM #2 - TOWN MANAGER'S REPORT
A. Project Update
1. Update on the Beeline Highway
Mr. Nordin said that he was concentrating his efforts on ADOT and
was trying to sort through the important issues. He stated that he
had been faxed a copy of a memo written by Mr. Roger Herzog of ADOT
written July 15, 1985 at the MAG Council meeting. The subject
matter of the memo was an update of ADOT's fiscal year 1986-1990 5-
year construction program stating that the Beeline Highway was
listed as part of this plan. He stated that he was researching a
rumor that ADOT had contracted an engineering firm to begin
construction on the Beeline. He commented that a representative
from District 29 was in support of this project and said that she
was important because she was the chairman of the House
Transportation Committee.
Mr. Nordin reported that the Beeline Highway Committee was working
on generating public interest for attendance at the upcoming April
26th ADOT meeting. He mentioned that he was attempting to rent a
bus for transporting people from Fountain Hills who wanted to attend
the meeting and explained the legalities linked with the rental of
public transportation for such purposes. He stated that the Town
could not legally rent the busses, however, the Chamber of Commerce
was willing to act as a conduit, receiving in turn from the town a
donation for economic development. Councilman Minarsich stated that
he had spoken with Sergeant Bob Mitchell who was in charge of the
Beeline Highway and that Sgt. Mitchell would be speaking at the next
meeting. Councilman Minarsich explained that the highway was
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currently undermanned due to officer unavailability. Councilman Fox
suggested that the Town should issue a letter to the Governor
expressing the desire to have a meeting between the Mayor and the
Governor.
2. Program of work update
Mr. Nordin stated that this agenda item was very closely related to
agenda item #4 and that he would elaborate when the Council reached
that item.
3. Presentation/discussion on community facility districts/improvement
districts
Mr. Nordin explained that a special assessment district was
identical to an improvement district. As an example he mentioned
that residents living on Spotted Horse Way had expressed interest in
the improvement district method of financing and that they had given
this some consideration. He explained that this method of financing
allowed the people living on Spotted Hose Way to pay for their own
road paving and that the Council had the ability to order the
improvement. He stated that next the Council would pass a
Resolution of Intention giving the public notification of the
proposed improvements. This would allow those residents living on
Spotted Horse Way to protest the issue. He pointed out that a
resolution of intention did not finalize the decision to make the
improvement district. He stated that if after the public
notification, no protest was received, the Council would pass a
Resolution of Intent to sell bonds and create the improvement
district.
Mr. Farrell stated that the second resolution allowed the plans and
specifications to be sent out for public bids and that the lowest
bidder would be chosen. He said that next an assessment would be
prepared by the bidder for each property based on the traditional
methods and a notice would be sent to each property- owner within the
improvement district stating the exact amount being charged to each
for the improvements. He said that another protest period was
allowed concerning the amount and the method of apportionment and
that after that period had passed the notice to the contractor to
proceed was sent by the Town Council for work to begin. He said
that the property owner had the choice to either elect to pay the
entire assessment in cash or elect not to make the payment, thus
determining the amount for which the bonds would be sold. He stated
that this amount was retired on semi-annual payments traditionally
and in January and June of each year a bill would go out to the
property owners showing their semi-annual payment over a certain
period of time. He stated that a financial institution was
appointed as a collection agent. Then a trustee would send a bill
to the Town for reimbursement until all bonds were paid in full. He
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stated that, generally, an improvement district lien was superior to
the traditional mortgage liens on property. He further stated that
if a federal agency were able to legally renounce the lien from the
property then the Town would have contingent liability for the rest
of the semi-annual payments owed. He explained that the improvement
district being discussed that evening would initially begin with two
parcels. He stated that the Town could contribute a certain
percentage of the funds for the improvement but clarified that the
Town could not run its own financing mechanism.
Mr. Nordin explained that improvement districts relating to the
Felker parcel would be almost identical in their relation to the
rest of the Town. He stated that the likelihood of Mr. Felker or
the Los Altos Hills group to object to improvement districts was not
likely. He said that it was staff's intent to recommend the Council
to utilize improvement districts and that the staff planned to
prepare a more detailed justification outlining the number of steps
as it related to the idea of contention and liability between the
time of the Resolution of Intention and the final Resolution. He
said that he would request the Council to consider passing the
Resolution of Intention within the next two weeks.
Councilman O'Brien clarified that the group of affected residents
would have the ability to protest the improvement district and asked
if people who were not residing within the improvement district
would have the ability to protest. Mr. Nordin replied that an
outside group would not have the legal ability to stop the process,
however, he said that it would have the political ability to stop
the process.
Mr. Farrell said that after the second protest period if the
engineering estimates made were low and the bids too high the
residents would have the ability to stop the process.
Mr. Farrell explained that early in 1987 Arizona Legislature passed
a comprehensive bill which allowed for the creation of community
facilities districts. He stated that the community facilities
district was an attempt to aid large master developers in financing
certain basic infrastructure within the corporate limits of existing
cities or towns. He said that they created a separate political
subdivision within the city or town. He said that a limited amount
of power was given to that specific subdivision which could be
composed of either the mayor and council of the town or a board of
directors appointed by the mayor and council. He said that the
powers which they had were those of condemnation and the power to
enter into debt through the sale of bonds or through fixing a tax on
real property. He said that in the four years since its inception
there had been several districts formed but no bond money had been
realized from community facilities districts. He stated that the
lbw prospect of ever realizing money from community facilities districts
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under the laws as presently written was very slim. He said that he
did not recommend the formulation of community facilities districts.
Mr. Bob Casillas of Peackock, Hislop, Staley & Given gave a general
description of improvement district financing and formulation and
briefly described the types of projects they were used for. He said
that the amount of assessment could be paid over a ten to fifteen
year period of time. He explained that when each parcel was sold
the lien would become the new owner's responsibility and said that
bond proceeds were available for investment purposes during the
construction period.
Mr. Nordin stated that step #1 had not yet been completed for the
Felker parcel. Mr. Casillas explained that the next step, adoption
of the Resolution of Intention would provide a description of
improvements included within the district and would make a reference
to- the plans and specifications kept at the Town offices. He said
that they would discuss principal and interest rates in terms of the
proposed structure of the bond issue. He said that, typically, the
Town made provisions for what they believed would be the largest
bond issue and the highest interest rate because if, when the
bidding process was higher than anticipated, the process may need to
be started over again. He discussed the types of projects which may
be funded by improvement districts and stated that administrative 101)
costs should be included. He explained that once the notice of
resolution was published the Town would call a hearing for any
protests or objections. He said that protests must be filed within
fifteen days after publishing the notice. He stated that after that
the Town had thirty days to hear the protest and if more than 50Z of
the residents involved voiced protests then the improvement district
process would be halted. He said that if the improvement district
was accepted the town would adopt, post and publish a resolution
ordering the improvements and inviting construction bids. He said
that after the bids and receipt of the contract another protest
period ensued. He stated that if no protests were made the contract
would be executed and the town would adopt the resolution. Then,
after thirty days, the property owners could either pay cash or
choose to utilize the bond process. He said then a list of the
unpaid assessments would be filed with the town clerk and bonds
would be issued.
Mr. Casillas explained the benefits to a town when adopting
improvement districts and discussed the importance of considering
the degree of benefit for each as well as possible problems.
Mr. Nordin said that he wanted the Council to feel comfortable and
knowledgeable when the request to issue the notice of intention
issue came up again.
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4. Discuss formulating a 5 year plan including a prioritization of the
following projects:
a. Police Department
b. Community Center Complex (15 acre site)
c. Parks and Recreation - Land and Capital Acquisition Projects
d. Assimilation of the Sanitary and Fire Districts and the Water
Company into the Town Government
e. Planning and Zoning Department Expansion
Mr. Nordin said that he recommended the Council approve a directive
which would authorize the Town to prepare a five-year plan. He
stated that the framework to be proposed to the Council would begin
with a basic budget for 1991-1992 and would be projected through a
five year period. He commented that the budget would include only
the level of service being maintained currently. Then, he said, he
would prepare budgets including the projects outlined above.
Vice Mayor Clark stated that he felt formulation of a priority list
of projects was premature because he believed studies needed to be
finalized first and that more data was needed. Mr. Nordin stated
that he desired creating a document describing all projects which
the Town wished to pursue along with all financial data. He further
stated that the document he was proposing was not a finalized five-
year plan and would be subject to the Council 's input. Councilman
Fox mentioned that revenues would change and stated that the plan
needed to be flexible. The Council discussed specific changes they
desired be made to Mr. Nordin's document and made recommendations
concerning prioritizing various issues.
B. Discuss:
1. Special event request by the Sunset Kiwanis for an Adult & Youth
Biathlon
2. Liquor license application for the Alamo Saloon
3. Liquor license application for Safeway
Police coverage concerning each issue as well as the types of
vehicles allowed for transporting supplies was discussed. No other
questions were raised by the Councilmembers on these subjects.
(1111,0
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AGENDA ITEM #3 - DISCUSS RESOLUTION 1991-16 ADOPTING A CONSTRUCTION FEE SCHEDULE
FOR CONSTRUCTION PLAN REVIEWS
Mr. Jeppson described the necessity of having the Town Engineering Department
develop a fee schedule. He stated that the fees were to pay for the cost which
the Engineering Department incurred when plan checking and making inspections in
order to insure all new construction complied with the zoning and aesthetic codes
of Fountain Hills. He commented that the schedule was recommended by Mr. Bill
O'Dell who was under contract with the Town to perform the engineering functions
and described various ways in which other Towns developed their engineering fee
schedules and compared them with the schedule being proposed.
Mr. Jeppson stated that as more property was being developed on steeper grades
the Town engineer was becoming more involved in the development procedure. He
further stated that as Fountain Hills grew, more engineering expertise would be
needed. He explained that the fee schedule would need to be revised and refined
as the Town became more experienced with new development.
AGENDA ITEM #4 - DISCUSS RESOLUTION 1991-17. PETITIONING THE ARIZONA STATE LAND
COMMISSIONER AND THE STATE LAND SELECTIONS BOARD. PURSUANT TO A.R.S. SECTION 9-
471. SUBSECTION (A)(1). TO AUTHORIZE THE ANNEXATION OF CERTAIN STATE TRUST LANDS
LYING CONTIGUOUS TO THE TOWN OF FOUNTAIN HILLS
Mr. Nordin explained that this item began the annexation of two sections of land
which lay north of Fountain Hills and stated that they were both state trust
land. He mentioned that this would be a lengthy process and, if the Council
approved the resolution, several months would pass before any action would
happen.
AGENDA ITEM #5 - DISCUSS RESOLUTION 1991-18. AMENDING RESOLUTION 1991-14 WHICH
ORDERED THE SALE OF TOWN OF FOUNTAIN HILLS. ARIZONA GENERAL OBLIGATION BONDS.
SERIES 1991. IN THE TOTAL AGGREGATE PRINCIPAL AMOUNT OF $3.500.000. FIXING THE
DATE AND HOUR OF SALE. AND DIRECTING THE PUBLICATION OF NOTICE INVITING PROPOSALS
FOR PURCHASE OF BONDS
AGENDA ITEM #6 - DISCUSS RESOLUTION 1991-19. AMENDING RESOLUTION 1991-15 WHICH
ORDERED THE SALE OF TOWN OF FOUNTAIN HILLS. ARIZONA STREET AND HIGHWAY USER
REVENUE BONDS. SERIES 1991. IN THE TOTAL AGGREGATE PRINCIPAL AMOUNT OF
S1.200.000. FIXING THE DATE AND HOUR OF SALE AND DIRECTING THE PUBLICATION OF
NOTICE INVITING PROPOSALS FOR PURCHASE OF BONDS
Mr. Nordin explained that both Agenda Items #5 and #6 would save the Town money.
He stated that to publish both the GO and the HURF orders to sell in the Arizona
Republic would cost $31,000 and, due to this fact, said he would like to have the
Town Council designate the Fountain Hills Times as the publishing entity for this
document. He pointed out, however, that the HURF bond council would not allow
the Town to use the Fountain Hills Times for publishing but said that Resolution
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1991-19 would shorten the required amount of publication thus saving the Town
money. He stated that he recommended that the Council approve both Resolution
1991-18 and 1991-19 and consider utilizing the emergency clause. He explained
that the HURF notice must be published in a newspaper of general circulation in
the county in which the bonds were to be sold and said that the Fountain Hills
Times did not satisfy this requirement.
AGENDA ITEM #7 - ADJOURNMENT
The Town Council adjourned the Work/Study session at approximately 9:55 p.m.
TOWN OF F AI ILLS -
By: / 'John M Cu illo, Mayor
ATTEST: C1a ,L,15
Cassie B. Hansen, Town Clerk
CERTIFICATION
41, I hereby certify that the foregoing minutes are a true and correct copy of the
minutes of the Work/Study Session held by the Town Council of Fountain Hills on
the 16th day of April, 1991. I further certify that the meeting was duly called
and that a quorum was present.
DATED this day of May, 1991.
Ciu34.6._
15. I
Cassie B. Hansen, Town Clerk
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