HomeMy WebLinkAbout1991.0604.TCWSM.Minutes TOWN OF FOUNTAIN HILLS
r MINUTES OF THE WORK/STUDY SESSION OF THE FOUNTAIN HILLS TOWN COUNCIL
JUNE 4, 1991
A public meeting of the Fountain Hills Town Council was convened and called to
order by Mayor John Cutillo at 6:30 p.m. , Tuesday, June 4, 1991, in the
Conference Room of the Town Hall Offices located at 16836 E. Palisades Blvd. ,
Building C, Fountain Hills, Arizona.
Present for roll call 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 Judge Shoob, Town Attorneys Bill Farrell and Nick Dottermann and
Town Clerk Cassie Hansen.
ADGENDA ITEM #2 — TOWN MAGISTRATE'S REPORT
Judge Shoob gave his monthly report and stated that collections seemed to be up
a bit. Judge Shoob referred to Phoenix's recent amnesty program and said that
he did not favor this program. Judge Shoob stated that he wanted to take the
names of Fountain Hills residents that have outstanding fines, suspended licenses
or are on warrants and publish them in the newspaper to see if they would come
in and pay their fines. Judge Shoob stated that the Court's records are public
so there would be no breach and he could see no problem with doing so.
Councilman Hudson asked Mr. Farrell if there would be any problem and Mr. Farrell
stated that it was a fairly common practice to print police call reports, etc.
Judge Shoob stated that the people in the police call report publications had not
even been to court when those were printed and the names that he would be
publishing would have been ajudicated either by a guilty plea or by a trial or
a hearing. Mr. Farrell stated that he saw no problem with running all of the
names, not just the persons that live in Fountain Hills. Councilwoman Tibbetts
asked how many names there were and Judge Shoob stated that he thought there were
approximately fifty people in Fountain Hills. Mayor Cutillo stated that this was
a Court decision, not a Council decision. Judge Shoob stated although that was
correct, he wanted the Council 's concurrence. Judge Shoob stated that he had a
new part time clerk and that she seemed to be working out very well. He said
that the current month had been the biggest month for collections so far and he
felt that it would continue.
AGENDA ITEM #3 — DISCUSS THE REQUEST BY THE SUNSET KIWANIS FOR A SPECIAL EVENT
LIQUOR PERMIT FOR THE FOURTH OF JULY CELEBRATION
Mayor Cutillo asked who was present to answer any questions and Ms. Hansen stated
that Steve Tekesky was present. Councilman Hudson asked about the insurance for
the event, stating that a certificate of insurance was needed as well as liquor
liability coverage. Mr. Tekesky stated that they had applied for the same
Minutes of the Work/Study Session of the Town Council 6/4/91
4411, Page 1 of 6
•
coverage that they had last November and he produced a copy of the certificate
and on this document there was a description of operations, liquor liability *41410
coverage of one million dollars. Mr. Tekesky stated that they had not made
application for this because the application cost was over five hundred dollars
and they did not know what the Council's decision was going to be. Mr. Tekesky
did say that they had contacted the Insurance Company and a policy naming the
Town, the Chamber and MCO as co-insured would be available. Mayor Cutillo and
Councilman Hudson questioned how the liquor sales would be controlled and Mr.
Tekesky answered that there would be security guards at each of the three
entrances and if a person said they were going to purchase alcohol, they would
be carded and a permanent hospital-type wrist band would be put on them and the
only way it could be removed would be to cut it. Dr. O'Brien asked what the time
limit was for the sale of alcohol and Ms. Hansen stated that ten o'clock would
be the time limit for sales and eleven o'clock would be the time indicated on the
actual permit in order to give them an hour to clean up their booth and close up.
Marshal Dean requested that the sale of liquor be stopped at ten o'clock and the
security guards at the gates would be stopping anyone who was carrying a drink
at that time and they will make them dispose of the drink before they leave.
AGENDA ITEM #4 - RESOLUTION 1991-26. APPROVING THE PLANS. SPECIFICATIONS AND
ESTIMATES AND DECLARING ITS INTENTION TO ORDER THE IMPROVEMENT OF A PORTION OF
THE TOWN OF FOUNTAIN HILLS KNOWN AS THE LOS ALTOS HILLS IMPROVEMENT DISTRICT BY
THE CONSTRUCTION OF CERTAIN IMPROVEMENTS INCLUDING THE CONSTRUCTION, PAVING AND
LANDSCAPING OF CERTAIN ROADS AND DRAINAGE FACILITIES; ALL AS SHOWN ON THE PLANS;
DESIGNATING SUCH IMPROVEMENT AS THE LOS ALTOS HILLS IMPROVEMENT DISTRICT;
DETERMINING THAT IMPROVEMENT BONDS WILL BE ISSUED TO FINANCE THE COSTS AND
EXPENSES THEREOF AND DECLARING THE WORK OR IMPROVEMENT TO BE OF MORE THAN LOCAL
OR ORDINARY PUBLIC BENEFIT; AND THAT THE COSTS OF SAID WORK OR IMPROVEMENT WILL
BE ASSESSED UPON THE LOS ALTOS HILLS IMPROVEMENT DISTRICT; AND PROVIDING THAT THE
PROPOSED WORK OR IMPROVEMENT WILL BE PERFORMED UNDER THE PROVISIONS OF 48-571
THROUGH 48-621 INCLUSIVE. ARIZONA REVISED STATUTES. AND ALL AMENDMENTS THERETO
Mr. Farrell stated that this resolution was the first in a series of actions,
public hearings and resolutions that would put an improvement district in place.
Mr. Farrell said that they had hoped that the resolution would have been ready
for presentation early last May however there were many engineering hours
involved to insure the information was all available to help them make a decision
and to comply with state statutes. Mr. Farrell said that the Town's Engineering
firm, Willdan Associates, had sent a letter from Susanna R. Struble which he
referred to, stating that the letter indicated that seven sets of plans and
reports had been reviewed and approved by the engineers. Mr. Farrell explained
that these would be the documents that would form the basis for the general
contractor's bid should the Council elect to go forward with the formation of the
district. Mr. Farrell went on to say that the second part of the equation was
that once the plans and specifictions were submitted and reviewed by the
engineers, Mr. Gliege, the Town's Bond Counsel, would review it in concept to
insure that they were the types of improvements that were authorized and
anticipated by the state law in regard to the use of improvement district
financing. Mr. Farrell said that the third element that was needed in order to
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 2 of 6
have the resolution was an estimated engineer's figure as to what these
particular improvements would cost and he said that figure was six million three
hundred fifty thousand dollars. Mr. Farrell explained to the Council that if
they looked with favor upon Resolution 1991-26 at the Regular Session, they would
be fixing in time and in place the plans and specifications that could be sent
out to bid with their understanding of what that estimate was and anyone who
would choose to attend the public hearing on this decision would have information
so that they could ask questions or present statements either for or against the
formation of the district. Mr. Farrell stated that staff was at the point of
recommending adoption of Resolution 1991-26. Councilman O'Brien referred to page
four and asked what the provisions were in Title 48, Chapter 4, Article 2,
regarding the assessments of public property and Mr. Gliege replied that normally
public property would be omitted from an assessment and if it was omitted, the
charge that would have been levied against the public property would be
redistributed among all of the other property within the district. Mr. Gliege
stated that there were occasions where public property had been assessed and
could legally be assessed, however, he did not feel that this would be the case
because all of the property was under private ownership but this type of clause
was necessary in case something would become public property prior to the levy
of the assessment. There would need to be a way to take that assessment and
redistribute it. Councilman O'Brien asked what would happen if someone purchased
it and then later donated it once the assessments had been levied. Mr. Gliege
stated that once the assessment had been levied it would be an encumberance on
the land and it would have to be paid off. Councilwoman Tibbetts stated that she
had a question on page five with regard to the protest and objection, the third
paragraph from the bottom, that owners and all other persons directly interested
in the assessment would be qualified to object and in the next paragraph it said
that you had to be an owner in order to officially object. Mr. Gliege said that
the objections in a case like this were normally limited to the owners of
property within the district. He did say that it would be wise to allow the
community to have input in the entire process in this case. Mr. Gliege stated
that the objection that the third paragraph was referring to was a legal
objection, in that if the owners of more than fifty-one percent of the property
protest, the process would stop. Mr. Gliege explained that if there was an
adjacent property owner who was opposed it and said that he wanted to be
included in it, he could be added on even though he coculd not legally protest
to kill the project. Councliman Minarsich stated that there was a difference
between an objection and a protest and Mr. Gliege confirmed that. Councilman
O'Brien commented that the law required that all of these things be submitted in
writing prior to the hearing and Mr. Gliege said that his experience had been
that they take everyone's objection that comes to the hearing. Mr. Gliege stated
that particular written protests or objections would be either granted or
overruled by a Council motion. Mr. Farrell asked if the Council was amenable to
setting the hearing date for July 10, 1991 at 6:30 p.m. and Ms. Hansen stated
that the Council was already meeting for budget discussions on July 9, 10, and
11. Councilman Hudson stated that he would be present for the July 9 and 10
meetings and absent on the llth. Vice Mayor Clark said that he would be absent
all three days and Mr. Farrell said that he would be absent on July 9 and 10.
Mr. Farrell stated that if the Council adopted Resolution 1991-26 on Thursday
night, paragraph nine (the location of the hearing) had to be exact because three
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 3 of 6
things would occur from it, a publication: posting and a mailed notice. Vice
Mayor Clark asked about the last few words of the fourth line up from the bottom *4411)
of page four, section six, reading "as of the date of the bonds" and questioned
what date this referred to, the date they were sold. Mr. Gliege stated that the
bonds were dated on their face which was usually the first of the month that they
were sold and delivered. Mr. Gliege said that the dated date on the bond was
critical and was considered to be the date that they were available to be sold
initially. Mr. Gliege stated that the resolution will say that the bonds will
be dated a certain date, for example, October 1, then in September the Town could
except bids for the bonds with a date of October 1. He went on to explain that
the bonds are only issued in the amount of the unpaid assessments. For instance,
if there were ten property owners and half of them had paid their assessment off
in cash prior to the sale of the bonds, the bonds would only be for the unpaid
assessments. Mr. Farrell stated that if someone came in and paid, not only would
bonds not be sold on those lots but those lots would not be assessed and
conversely if someone had pledged to pay and had failed to, then the bonds would
be issued to cover the cost of the contractor. Mr. Farrell said that one of the
important issues was where the money flowed and that the money ultimately flows
to the general contractor who performed the work, not to the developer. Mr.
Gliege stated that the property owner had a thirty day period to pay this off in
cash. Councilman Hudson asked Mr.Gliege what else was in the Town's letter of
agreement with him. Mr. Gliege said that at the public hearing, if the Council
chose to proceed, they would adopt a resolution ordering the work and then a
notice inviting bids would be issued and the contract would be awarded. Mr.
Gliege went on to explain that the assessment roll would then be certified and
it would go out for a thirty day payment period and then the no survive proposals
for the purchase of bonds would be approved which would go out to bid or could
be negotiated, then there would be a resolution to sell the bonds and a series
of closing documents. Mr. Gliege said that following the completion of the work
there would be a hearing on the assessments, one more public hearing and then
they would be confirmed and the project would be considered completed.
Councilman Hudson requested some certification as to the value of the property
and confirmation on who owns the property. Mr. Gliege stated that he had in his
possession a limited title report which indicated that those who purportedly own
the property do own the property as of the date on the report. He added that he
had requested that the report be brought current to the date of the bond closing
and he also had an appraisal which he would make available to the Council,
stating that the dollar value on the appraisal was $23,800,000. , based on
potential development. Mr. Farrell stated that the debt to value ratio
determination would he made when the second resolution was passed. Councilman
Fox asked what it would be worth if there was a default and Mr. Gliege stated
that it would not make any difference as long as there was enough value there to
pay the outstanding bonds. He added that the Town would be first in line and
that the value derived from the property would only need to be sufficient to meet
the outstanding bonds. Mr. Gliege stated that he was sure there would be an
instrument of debt created and liened against the property to help pay for the
non-improvement districts. Mayor Cutillo requested that staff present the
approximate cost to each property owner should the company default and the land
did not sell. Mr. Gliege stated that the only time the liability extended beyond
the parcel of property within the district would be in the event of a default on
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 4 of 6
the bonds. Mr. Gliege said that if the Town's general fund was large enough to
carry the burden it would be of no cost to the property owners within the
community. Mr. Gliege pointed out that if this resolution was adopted, it would
not be a public hearing, however, it would set the stage for a public hearing in
the future. At that time, the Council would have the opportunity to stop the
project. Mr. Gliege explained that once the construction contract was signed
there would be some liability although the contractor would have no way to get
into the Town's pockets. He added that the sale of the bonds would be what would
tie the first potential liability onto the project. Mr. Gliege stated that the
worst case would be if the whole project would default. He said there would be
a debt and the Town's obligation would be to cover the debt in installments and
if the loan is for ten years, the Town would have ten years to try to sell the
property for the amount of the unpaid debt. He added that if the project
defaulted it should be thought of as an obligation to meet semi-annual payments.
Councilwoman Tibbetts stated that in a brochure the Council had received there
was reference to two other projects and that they had obtained a guarantee. She
asked what they were guaranteeing. Mr. Gliege answered that the financial
underwriters of the bonds would probably request that the property owner produce
a guarantee from a financial institution that would stand behind the bonds. In
the event of a_default_, the financial institution would be approached before the
Town was pursued . Councilwoman Tibbetts stated that she hoped that the
presentation would be strong enough that people would be anxious to purchase.
Mr. Gliege stated that it would be possible that the lowest bid could be over
$6.3 million and at that point Mr. Felker and his advisers would have to decide
if they wanted to go forward with the project. He said that he had seen
engineer's estimates on municipal projects miss by several million dollars. Vice
Mayor Clark asked a question concerning the funds, and explained that there was
a line item for the town staff management of the program which seemed low to him.
Mr. Farrell stated that for the recapture of costs in improvement districts, the
cited $15,000 was a rather generous amount and he went on to explain that quite
often, in order to encourage improvement districts, municipalities would take
nothing for the administrative time. In the City of Yuma, for example, they
contributed hard cash to improvement districts in terms of engineering costs and
time expenditures in order to encourage the citizens to use the districts for
capital improvements. Mr. Gleige stated that there was approximately $126,000
for permits which includes the inspection activities of the Town contained in the
engineering part of the estimate. Vice Mayor Clark referred to the top of page
six regarding the appointment of a district engineer and he asked if this would
be the Town's engineer or a different person and Mr. Gliege replied that the
Town's engineer normally would serve as the superintendent of streets and an
engineer from Collier, Williams and White would be chosen. He went on to explain
that the Town would not want the street sluperintendent to the the project
engineer because he would be inspecting his own work. Mr. Farrell stated that
Mr, Nordin had recommended Will.dan to do the supervisory work. Mr. Gliege stated
that this type of a project would have maximum Town control, the money from the
sale of the bonds would go into a fund in the name of the Town and could not be
spent without the Council authorizing the expenditure. In turn, he explained
that the Council should not approve anything without the engineer's signature
stating that a particular amount of work had been done. Vice Mayor Clark asked
about the sewer system for the project and a Felker representative replied that
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 5 of 6
the developer would he responsible for this and that the sanitary district would
inspect the installation and the laterals.
AGENDA ITEM #13 — ADJOURNMENT
The Council adjourned at approximately 7:40 p.m.
TOWN OF FOUNTAIN HILLS
By:
John M. Cutillo, Mayor
ATTEST:
Cassie B. Hansen, Town Clerk
CERTIFICATION
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 4th day of June 1991. I further certify that the meeting was duly called and
that a quorum was present .
DATED this day of August .1991.
Nod
Cassie B. Hansen, Town Clerk
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 6 of 6
the developer would be responsible for this and that the sanitary district would
inspect the installation and the laterals.
AGENDA ITEM #5 — ADJOURNMENT
The Council adjourned at approximately 7:40 p.m.
TOWN OF UNT N HIL
7
By: �
John i. utillo, Mayor
ATTEST: .6•
Cassie B. Hansen, Town Clerk
CERTIFICATION
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 4th day of June 1991. I further certify that the meeting was duly called and
that a quorum was present.
DATED this r3 r\d day of August 1991.
•6. ittAt4A,‘)
Cassie B. Hansen, Town Clerk
Minutes of the Work/Study Session of the Town Council 6/4/91
Page 6 of 6