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HomeMy WebLinkAbout2003.0102.TCREM.Minutes TOWN OF FOUNTAIN HILLS MINUTES OF THE REGULAR AND EXECUTIVE SESSION OF THE FOUNTAIN HILLS TOWN COUNCIL January 2,2003 Mayor Beydler called the meeting to order at 6:00 p.m. AGENDA ITEM #1 - PURSUANT TO A.R.S. §38-431.03.A.3, VOTE TO GO INTO EXECUTIVE SESSION FOR: DISCUSSION OR CONSULTATION FOR LEGAL ADVICE WITH THE ATTORNEY OR ATTORNEYS OF THE PUBLIC BODY, SPECIFICALLY, REGARDING IMPLEMENTATION OF THE RECOMMENDATIONS FROM THE FIRE AND EMERGENCY SERVICE FUNDING CITIZENS ADVISORY COMMITTEE. Councilman Melendez MOVED to convene the executive session and Councilwoman Nicola SECONDED the motion, which CARRIED unanimously. AGENDA ITEM#2-RETURN TO REGULAR SESSION Mayor Beydler reconvened the regular session at 6:30 p.m. Following a moment of silence,roll call was taken. ROLL CALL - Present for roll call were the following members of the Fountain Hills Town Council: Mayor Jon Beydler, and Councilmembers Rick Melendez, Kathleen Nicola, Michael Archambault and John Kavanagh. Town Attorney Andrew McGuire and Director of Administration/Town Clerk Cassie Hansen were also present. Vice Mayor Leesa Stevens,Councilwoman Susan Ralphe,and Town Manager Tim Pickering were absent. Mayor Beydler recused himself from the dais expressing that there could be a perceived conflict of interest with regard to agenda item #1 because it entailed a request for a temporary use permit at a location where he has a business. He stated he wanted to avoid any appearance of impropriety. Councilman Melendez conducted the meeting in Mayor Beydler's absence. AGENDA ITEM #1 - CONSIDERATION OF A TEMPORARY USE PERMIT TO ALLOW OUTDOOR RETAIL SALES TO OCCUR MORE THAN FOUR TIMES DURING ONE CALENDAR YEAR, LOCATED AT 12645 N. SAGUARO BLVD., AKA LOT 2 OF THE PLAZA FOUNTAINSIDE FINAL PLAT, CASE NUMBER TU2002-04. Senior Planner Dana Burkhardt gave an overview of the application and site. He asked for a continuance so staff could conduct further analysis of the interpretation of the zoning requirements for temporary use permits for more than four uses per year. He stated that he and Town Attorney Andrew McGuire both felt additional time was needed to investigate the intention of the ordinance. He reviewed staff's stipulations. Councilman Kavanagh MOVED to continue this item until the next meeting and Councilwoman Nicola SECONDED the motion. The motion CARRIED on a vote of 3 to 1. Councilman Archambault cast the nay vote. Councilman Melendez requested that Mayor Beydler return to the dais. AGENDA ITEM #2 - PRESENTATION BY THE FIRE AND EMERGENCY SERVICE FUNDING CITIZENS ADVISORY COMMITTEE WITH POSSIBLE DIRECTION TO STAFF TO TAKE ACTION. Chair John Cutillo gave a brief overview of the committee's activities, findings, and their recommendation. The committee agreed that a fire district would be the best solution. He read the four-step recommendation: 1. Immediately implement a temporary 1% sales tax increase for the purpose of funding Fire and EMS. This tax would sunset upon receipt of property tax revenue or by June 30, 2004, whichever came first. 2. Authorize an election in May, 2003, for the purpose of a public vote on a primary property tax to raise $3 million for funding Fire and EMS in the Town of Fountain Hills beginning in fiscal year 2003-2004. 3. Authorize residents' efforts interested in establishing a fire district to pursue this concept through June 30, 2004. If successful by that date, the secondary property tax levied by a new fire district would replace the primary property tax from the May, 2003, election. The Council would change the primary tax assessment from$3 million to zero in fiscal year 2004-05. E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 1 of 10 4. In the event that a property tax, in the form of a primary tax by the Town, or a secondary tax by a Fire District, was not passed by the public, the Council should take action in the form of a resolution recognizing Fire and EMS as a basic responsibility of municipal government and direct the Town Manager to budget accordingly upon sunset of the temporary sales tax on June 30. 2004. Mr. Cutillo thanked Town staff for their assistance and the Council for allowing the committee members to serve. Mayor Beydler thanked the committee members for their efforts on behalf of the Council. Councilman Archambault asked Mr. Cutillo if the committee had the opportunity to look at other budget revenues. He had thought that was Council's instruction. Mr. Cutillo explained the committee had looked at some of the budget constraints but not the total picture, as they simply did not have the time to do that. Councilman Archambault asked if staff had prepared information on some of that. Mr. Cutillo stated that the committee received only an outline of where the town was going according to income vs. expenses. Councilman Archambault stated he was troubled that the blue ribbon committee was not given the opportunity to look at diversified revenue sources. He expressed that he had thought it had been Council's direction that this committee look at every possible revenue source. Because of that, he felt the committee might have gone down the road with blinders on. He felt that raising the sales tax only punished the people who work and live in town. He did not feel that they had really caused the problem. He felt that would be making a bad decision after a serious mistake. Fountain Hills would then have one of the highest sales tax rates. Fountain Hills would also be setting itself up for another controversy and bad press that would follow. He did not feel it was prudent to try to replace the money in the reserve account within one year, as that would be equivalent to someone putting away an entire retirement account within a year. Councilman Archambault stated that the Council needed to focus on a $4.9 million deficit rather than the $6 million deficit. He was against a "tax and spend" philosophy. He noted that he felt Fountain Hills was being modeled after a city back east. He stated that Mr. Pickering came from the St. Louis area and these areas were usually flush with cash but operated in a deficit. He pointed out that Fountain Hills could not operate that way. He said most people moved here to get away from the "tax and spend" government. Councilman Archambault expressed that the voters did not trust the Council. The Town would be well served if the Council would stop the Town's hemorrhaging rather than asking the stakeholders for more money. He verbalized it would serve as a stepping-stone to regaining the trust of the people. Councilman Archambault pointed Lout that if the Council were to initiate every committee recommendation, the voters would be confused. He felt that the voters had been waiting for the Council to apologize. Councilman Archambault apologized for taking over a town lake with a leaky liner, for building a community center that was a burden on this community instead of building an efficient town hall, spending$500,000 for a fire truck that the town did not need, and for taking over a fire district. He said the Council needed to gain the confidence of the staff, noting that the results of the December 5th Council meeting devastated the staff. He outlined other options. The town needed to cut their losses with regard to the current town hall and construct modulars on the town owned property near the community center. This option would save approximately $300,000 per year. The town needed to look at providing refuse service. This option would generate approximately $600,000 per year. The town needed to stop the bleeding at the community center and charge the actual costs of those accommodations and utilization of that building. The town should support the citizens in forming a new Fire District. He stated that the town got rid of the public safety director so now there wasn't any one watching the hen house except the fox. There wasn't anyone watching the contract employees. He noted that $2.8 million had already been cut out of the budget and combined with the revenues and the savings he proposed that would total approximately $4.5 million out of a $4.9 million deficit. He asked if the Town couldn't get close to the$400,000 that he had estimated they were still short? Councilman Archambault MOVED to direct staff to write a resolution approving the formation (or give a committee the approval) to form a new fire district. He wanted to give the people the Council's blessing. He also wanted staff to do whatever was possible to help put that district on the fast track. He wanted to ask the County to help the Town formulate that new district on the fast track. That would give the voters one issue to focus on. If the Council were to get their own house in order, put a fire district back, and implement some of these options, the Town would be in the black. He asked Mr. McGuire if there was anything else to add to the motion. Mr. McGuire stated that if that motion passed, staff would bring to the Council a resolution at the next meeting that would accomplish that. Councilwoman Nicola asked Councilman Archambault if his motion eliminated the other considerations brought forward by the committee and that the Council only move forward in the one direction. Councilman Archambault responded that was correct and then the town would then tighten their belts on the rest. likw Mayor Beydler SECONDED the motion. E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 2 of 10 Councilwoman Nicola encouraged the Council to discuss a contingency plan. She did not want the Council to put all of their eggs in one basket and then in the future wonder what the next step would be. Councilman Kavanagh moved to AMEND the motion and to include the committee's recommendations 1, 2, and 4. He explained that he was basically recommending that the Council do everything that the committee had recommended. He expressed that he did not want to lay off any more people. Councilman Melendez SECONDED the amendment. Councilman Melendez clarified a couple of points. Councilman Melendez referred to Councilman Archambault's statement that they had gotten rid of the public safety director. He affirmed that neither the previous Council nor the current Council had gotten rid of the public safety director. There was documentation on file that contained the answers on that issue. Councilman Melendez felt the word apology was always acceptable; however, actions were far better than apologies. He agreed that he did not want to put all the eggs in one basket and a backup plan was needed. Councilman Melendez stated that this recommendation was a clear solution to the problems facing Fountain Hills. Councilwoman Nicola explained that she asked for some type of a contingency. While she thought the new fire district could be formed, what happened if the actions of the committee to reestablish the fire district were not successful? Where would the town be? She did not support Councilman Kavanagh's amendment. She expressed her appreciation for the hard work of the committee and the thoroughness of the work completed and the proposed recommendations. Councilwoman Nicola stated she did not want to go in three different directions because of concern for the success of any of them if the council diversified their actions that far. She wanted the opportunity to hold back on the sales tax. Councilwoman Nicola suggested looking at a sales tax increase for other budget solving reasons but not attach it to the Fire and EMS. Councilman Kavanagh questioned if the Council could only give direction to staff tonight, or vote on action. Mr. McGuire confirmed the agenda item was for the Council to give direction to the staff so action items could be brought forward at the next regular meeting. Councilman Kavanagh asked if the Council were to attach this motion brought forward by Councilman Archambault, would that preclude the Council from voting in the full recommendation of the committee when there would be a full Council at the next meeting. Mr. McGuire responded that would not preclude the Council from doing so but it might be difficult for staff to have prepared the Litems necessary for Council to formally approve them. Councilman Kavanagh WITHDREW his amendment and asked Councilman Melendez to withdraw his second so that he could change his amendment. Councilman Melendez WITHDREW his second. Councilman Kavanagh AMENDED the motion to direct staff to draft the appropriate ordinances and resolutions for all alternatives proposed so that when there was a full Council present there could be a truly democratic vote. Councilman Melendez SECONDED the amendment. Councilman Melendez felt that this was prudent since the town manager had been the focal point at all of the committee meetings and was not present tonight and because two council members were absent. He stated few understood the deep financial crisis that the town was in. While he appreciated Councilman Archambault's ideas, he pointed out there had been a memo from Mr. Pickering to the committee directing the committee to deal only with the issue of resolving the fire district and with no other issues. He felt the council members owed it to themselves to wait to make their decision until the next meeting when there would be a full Council present, as well as the town manager. Mayor Beydler asked the town attorney what was the purpose of a quorum. Mr. McGuire replied a quorum allowed the group to conduct the business on the agenda. Mayor Beydler asked Interim Town Manager Tom Ward what would the approximate carry forward position be as of June 30, 2003, given the budget cuts previously approved. Mayor Beydler noted that Julie Ghetti had reported prior to the budget cuts the estimated carry forward had been $600,000. Mr. Ward deferred to Ms. Ghetti, as he had not previously discussed that with Mr. Pickering. Ms. Ghetti explained that until January 31, 2003, when all of the cuts would be in place and it was known what positions would be eliminated, she would not know what the carry forward would be. She felt that staff would know more in a month as to what the anticipated revenues would be. She stated it was too early to tell. She estimated that it would be somewhere around $600,000 unless something happened. Mayor Beydler questioned if with the approved cuts the carry forward would be the same? Ms. Ghetti clarified that she did not know what the cuts were because the cuts had been proposed and depending upon which positions were omitted or left vacant staff would not know what dollars would be attached to that. She noted that everything would be an estimate at this point. Mayor Beydler asked, assuming that the approved budget cuts actually were put into play, what would the approximate carry forward range be. Ms. Ghetti estimated that the additional carry forward would be$1 million. E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 3 of 10 Councilman Archambault expressed his concern that asking the voters for three different things would confuse them. He felt there was time to implement some things that the Council had not even seen yet. He stated it would not take that much time to generate revenue from a sales tax increase if they had to. If a property tax were put on the ballot and it was voter approved, and the town continued towards putting a fire district back in place, there would be two taxes in place. Councilman Kavanagh called for a point of order. He clarified that this amendment did not preclude what Councilman Archambault wanted. He said the amendment was to have staff provide all the alternatives so that when a full Council met at the next meeting it could be discussed. He saw no reason to talk about the relative merits, as this amendment would not stop Councilman Archambault from getting what he desired. He thought the discussion should be confined to the amendment, which would democratically give the full Council all the options in two weeks. Mayor Beydler pointed out that it had been clarified earlier that a quorum was a democratic process that was allowed to conduct business and Councilman Archambault had been voicing his opinion. Councilman Archambault restated his concerns were that there would be a quagmire out there as the committee had been slighted since they were not allowed to look at all the different revenue sources. That was clearly what the Council had talked about. Councilman Archambault stated he would not support the amendment. Councilman Kavanagh asked if Councilman Archambault had decided to compound the issue because of a perceived injustice. He questioned the difference between the perceived injustice to the committee not being allowed to look at all the revenue sources during their deliberations and that of not allowing the full Council looking at all the revenue sources when they met in two weeks. Councilman Archambault responded that the Council was delaying the process. He expressed that Mr. Pickering should have been present tonight but instead he decided to take a vacation, knowing how important this meeting was. Councilman Archambault noted that Vice Mayor Stevens was understandably missing and Councilwoman Ralphe was understandably sick but that was not his problem. The Council's purpose was to solve the town's problems and that was what he was here tonight to do. The council was present to listen to the committee's recommendation and move on them. Councilman Kavanagh reminded Councilman Archambault that all the recommendations could be included so that the entire Council could deliberate on all the options in two weeks and that did not slow down things. Mayor Beydler pointed out that perhaps council members simply did not want to move on all of the options. Councilman Kavanagh noted that kiwi, there might be those council members who do not want the entire Council present because the vote might not go their specific way. He wanted to know if they thought it was democratic to make a decision this great with two members absent when they could easily be given the opportunity to be present and it would not slow the process down. Mayor Beydler noted that there was a quorum present and that made it democratic. Councilman Kavanagh pointed out that made it legal not democratic. Councilwoman Nicola clarified that it was her understanding that the amendment was that everything would move forward and staff would provide the correct resolutions to vote on. Councilman Archambault wanted the Council to bring forward the resolution for allowing a new fire district to be formed and the process to begin. She stated that sales tax could be brought forward to Council at any given council meeting and there weren't any time constraints. Mr. McGuire confirmed that there wasn't a constraint upon when the council could levy sales tax. Councilwoman Nicola noted there were time constraints as to when an election could be called for a primary property tax. Mr. McGuire agreed that was correct. Councilwoman Nicola pointed out that the election deadline was two weeks from tonight. Mr. McGuire affirmed that the deadline to notify the County that the Town would have an election was 120 days out, which would fall on January 20, 2003. Councilwoman Nicola asked when formal action from the Council would be needed. Mr. McGuire stated it would be needed at the next regular meeting to be held on January 16`h. Councilwoman Nicola expressed that if the amendment failed and the Council only moved forward on one item, if any, there was still time to talk about a sales tax increase in the future. There would still be time to agendize discussion for a primary property tax. Councilman Kavanagh disagreed, as it would be taken off the agenda by not directing staff to research that recommendation. Councilwoman Nicola stated she was comfortable with item#4 (that the town maintain fire services). She supported the formation of a fire district and placing that back on the property tax in a secondary mode. She was uncomfortable about drawing the line here. She said she would not support the amendment because she felt it could be looked at again. Councilman Kavanagh said the property tax could not be looked at again. The primary property tax would die and if the committee could not collect enough signatures the town would have nothing and everyone would have to be laid off. He restated that the issue tonight was did the Council want to allow the absent two council members to vote on this matter. Councilman Kavanagh noted that the majority had the logistical advantage and he felt that was why this was happening. He reiterated that there wasn't any democratic reason why all the alternatives could not be E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 4 of 10 presented to a full Council. He commented that it would be one fun retreat when members of this council shut out two of their colleagues with this maneuver. Jerry Miles, committee member He agreed that the committee had overwhelmingly and emotionally thought the idea of a new fire district was very realistic. However, the mechanics for forming a new fire district were virtually impossible to meet. The town attorney was not aware if fast tracking that option with the county could be done. To form a new fire district through citizen action required that signatures of 50% + 1 of the registered voters be collected. He pointed out that the registered voters of this town were a group that was different than the actual voters of this town. There were literally thousands who fell into that category. He stated that in the neighborhood of 6,500 signatures would be needed to secure a new fire district. He noted that in the history of this town there had never been 6,500 people turn out to vote on anything. He felt this option was a long shot and a difficult task. He urged the Council to leave themselves the option to consider more than one alternative. He also wished that the committee had the opportunity to look at other funding sources, but he felt that the sales tax option would have been their number one "short-term"solution. Ellen Wanat, 15727 E. Sunflower She supported the formation of a fire district. She felt the signatures could be obtained within a six-month time frame. She volunteered her assistance to oversee this project should the Council approve this option. She was confident that it could be done. John Cutillo,committee member He disagreed with Jerry Miles that the committee would have recommended the implementation of the sales tax option if they had been aware of the real possibility of the utility franchise fees and savings from moving the town offices into modulars. These two options might result in about a $900,000 savings and that was approximately what the sales tax option would generate. There would have been further committee discussion. Tammy Rothermel,Deerskin She expressed that she had done research on forming a new fire district. She disagreed with Jerry Miles. She felt it was a task that could be accomplished. If approved, the process could be started immediately as time was of the essence. She proposed that if the Council were to back the petition drive, it could be made a patriotic issue and perhaps pull the town together. She supported the formation of a new fire district. Rita Brown, Nicholas Dr. She heard the Council state that the residents did not trust the Town Council. She did not feel there was a need to readdress the primary property tax issue unless the Council showed good faith by establishing a fire district. She agreed time was of the essence for the formation of a fire district. She said Mr. Miles was under the misconception that 6,500 have to appear to vote. That was not the case. Volunteers go out and get signatures. She felt it could easily be accomplished. John Wyman,Jacklin, Dr. He pointed out the important thing was triage. Although he did not like the idea of raising the sales tax, it was the one thing that the Council could control. Within 120 days from the time it was implemented, revenues would be coming in. He agreed with Councilman Archambault that this might appear to confuse the residents but this was an ambiguous situation and people have to learn to deal with ambiguity when dealing with such a tough situation. The Council appointed committee had unanimously recommended an action that deals with ambiguity. It was set up deliberately to have something in place in case something goes wrong. It was important to get a fire district in order to lift the $3 million burden off the town's back. If the Council did not look at the property tax issue now, it would be another year before it could be brought forward again. He encouraged the Council to go with the entire recommendation of the committee and act. Sandy Zinn, Saguaro Blvd. She urged the Council to support the formation of the new fire district and to put it on the fast track. She did not think the property tax measure would pass. She commented that it was not democratic of the Council to dissolve the previously duly elected fire board. She stated it would be easier to get the 6,500 signatures than to pass a property tax. E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 5 of 10 Bob Travis, Chinook He remarked that he had attended all the committee meetings. He stated at the last public meeting the committee unanimously voted to approve recommendation brought forward to the Council and then in the eleventh hour things changed and the town manager did not like the wording. An emergency meeting was held at the last minute (with out being published in the paper or anything)and at that time the committee decided to change what they had voted on the week before. He felt that action needed to be looked into by the Council. He asked that the Council give the formation of a new fire board a chance as a sales tax increase could be initiated at any time. John Cutillo,committee member He refuted Mr. Travis' statement. He confirmed that the last meeting of the committee had been properly noticed and was not conducted without notification. Bob Howes, committee member He stated the committee's charge had been to explore avenues of funding. Everyone had their own ideas whether or not they wanted a fire district. They had looked at avenues to bring in money to avoid the Town being in the dirt. He suggested that before the council's next meeting that they review some worksheets that had been put together that showed when the red ink flowed. He stated that if the Council did not impose a 1% sales tax(or close to that), and move in the direction that the committee had suggested,the town would be in dire straights. He stated that forming a fire district was a long-term solution. He felt the red ink would start to flow in approximately 6 months. If the Council did not act on the short-term solutions,the town would be in deep trouble. Roy Kinsey,Fairway Court He stated he did not have a personal agenda. He expressed he had come to this meeting to hear the recommendations of the "blue ribbon committee". He heard the both of best worlds. The committee presented the Council with their thoughts that allowed the town to gain solvency sooner but at the same time move forward on the formation of a fire district. He felt that too many people had spoken with only one idea in mind (Fire District). He said there was nothing wrong with doing both things at once. He hoped that the Council would stop to consider their committee's words before taking any action. Councilman Melendez stated that a 1% sales tax would generate approximately $2.6 million in additional revenue and that was a huge difference between that amount and the $900,000 that was talked about before. If the Council approved a sales tax increase, the Arizona Department of Revenue would require 60 additional days from which to work. He pointed out that some of the council members on the dais were not listening to the town manager. Mr. Pickering had written a memo stating that the town was going in the hole by $140,000 each month. Councilman Melendez said he supported forming a new fire district. However, he felt it was difficult to bank on one issue. He did not see anything wrong with the council moving forward with all of the recommendations of the "blue ribbon committee". He stated he wanted the town manager to articulate what had been done during all of the meetings held with the members of this committee. Then it would be appropriate for the democratic process to run the course. He saw nothing wrong with that. He said he agreed with Mr. Kinsey. Although he felt he agreed with forming a fire district,that action alone was not enough. Councilman Kavanagh clarified that nothing in his amendment would preclude the formation of a fire district. The amendment kept all the options open for the full Council. He was asking that all of the council members have the opportunity to discuss something that was as important as this. Since approving the amendment would in no way slow down the process, he personally did not see why anybody could object to more full and open discussions and participation. Mayor Beydler thought that with regard to the democratic process that Councilman Melendez would agree that he had gone out of his way to encourage Councilman Melendez to miss tonight's football game in Miami in order that Councilman Melendez could participate and air his point of view. Councilman Melendez agreed that was correct. Mayor Beydler stated that the intent had been to include. He pointed out that was why there were seven people on the Council so that if council members chose not to attend or have a family emergency, a quorum would legally exist and therefore the council could continue the work of the people. He commented that Fountain Hills was in dire straights before help arrived. This Council did not have the $6 million carry forward as was advertised back during the General Election. He remarked that the buck stopped here. Mayor Beydler stated that no one better than he knew what it took to deal with controversy and differences of opinion. He said he was willing to deal with them and make a decision. He ran for office on the platform that had included such items as expanding the tax base although very little discussion had taken place thus far on how the community could be marketed and revenue E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 6 of 10 sources could be diversified. He acknowledged that these were long-term solutions that would make this town fiscally solvent and responsible. Mayor Beydler said he did not want to expand the tax rate and he would not support any increase in the tax rate. �lrr He explained that he was not here to promote any new taxes, only a restoration of one that was wrongfully taken away a year and one-half ago, which had been a secondary property tax. He expressed he wanted to see the signatures collected by June 30, 2003, for a new fire district. He stated they were doing the right thing for this town although it might be tough and unpopular. He stated the Council could not confuse the voters. If a property tax were put on the ballot in May, and they were out talking with these same people to sign a petition to form a new fire district, he felt there would be more confusion and both recommendations would be defeated. He said the Council needed to focus on the one solution that would give the town the best chance for a long-term solution and that did not cost the people and businesses of this community more than they were spending now. During the holidays he had talked with business owners, educators, and administrators in Overgaard who told him that when it got tough, cut the budget more. He remarked that those were words that the Council needed to heed because if the Council had not cut it enough, then it needed to be cut more in order to put the Town's expenses in line with the income. He observed that the sales tax had not created this problem nor had the property tax. People had created this problem. The businesses in this community have been telling him don't try to balance the budget over their backs. The message to the community should be that this was the way out of the box. The real problem was the$3 million dollars. He wanted to go get the money and do it as a united community without a fail-safe backup plan. He questioned what was "fail-safe" about a property tax measure that failed 70/30. He expressed that the Council could not bet the Town's future on that backup plan. Councilman Archambault pointed out that this was the bottom of a turn down economy and would not last forever. When the economy turned around, the Town would see the sales tax revenues start to increase again but the Council needed to put their house in order to regain the public's trust, but to do so on the backs of the businesses would only make the situation worse. Councilman Kavanagh stated all of these arguments and statements by the Mayor and Councilman Archambault would be appropriate if this were two weeks from now when the Council was taking action on the recommendations of the committee. At this meeting the Council was simply telling staff to prepare information for the Council to consider. He reiterated that there were two council members absent, one extremely ill from food poisoning and the other on her honeymoon and that was why they were not present. He stated the issue was would all seven council members be allowed to make an informed complete decision from a full selection that had been recommended by the committee in two weeks. The issue was not whether or not it was wise to do one or the other. Would two council members be shut out unnecessarily for probable reasons of political strategy and expediency? He felt it was quite obvious at to what was going on. He could not believe that these council members would be shut out like that. He said this was not right. Councilman Melendez said he had conversations with many city councilpersons in state and out of state as well as mayors of these various cities. He read from a newspaper, which addressed the financial crisis that all cities all over the country were facing. To think that the problems could be solved without tax increases was unrealistic. He reiterated that a back up plan was needed. He stated that he would endorse the formation of the new fire district and collect signatures on behalf of the town, but if that failed what would the town have. He stated that John Wyman was right on target with his statements. He wanted the opportunity to vote on all of the issues. Mayor Beydler reminded everyone that it was the Council who could increase the sales tax at any time. It was not something on which the residents vote. He felt that was a back up plan and could be used if necessary. He suggested that deeper cuts could be made. He expressed that he too had talked to other mayors. He had been told to be very careful about increasing the sales tax until there was absolutely no other alternative. He pointed out that no one had addressed what the suppressed impact of increasing the sales tax would have on business retail sales. Mayor Beydler stated he had asked Ms. Ghetti about a month ago in her office if she had a formula to measure the negative impact of suppressed retail sales in the town by increasing the rate by 1.09%. To date no one had been able to measure that impact. He expressed that his concern was about newspaper headlines that would make this issue as important as possible. People would question whether or not Fountain Hills was affordable. He felt the Chamber should be concerned about the perceived impression. Councilwoman Nicola said it was a woman's prerogative to change her mind. There was nothing more disturbing to her than to hear that people knew how the vote was going to go and why. She expressed that although she was E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 7 of 10 still concerned about the confusion factor, after listening to this discussion, she was more concerned about how to put money in the coffers while the town went through the process of reestablishing a Fire District. Even though insulted by her colleague's comments, Councilwoman Nicola stated she was changing her position and would support the amendment. This would enable the Council to look logically as to how to solve the problem short-term and long term. A roll call vote was taken on the amendment with the following results: Mayor Beydler Nay Councilman Kavanagh Aye Councilman Archambault Nay Councilwoman Nicola Aye Councilman Melendez Aye The amendment CARRIED on a vote of 3—2. The amended motion CARRIED unanimously. AGENDA ITEM #3 - DISCUSSION OF UPCOMING FINANCIAL STEPS IN THE BUDGET REDUCTION PLAN AS PRESENTED IN THE TOWN MANAGER'S MEMO DATED 12/23/02. Interim Town Manager Tom Ward reviewed that Mr. Pickering had distributed his staff report in the packet. Mr. Pickering wanted to give the Council the opportunity to direct staff to prepare the necessary documentation to implement one or several of the options presented in his memo. This meeting was for a discussion of the six options. Councilman Kavanagh MOVED to direct staff to prepare a detailed report on items 2, 4, & 5 for the next meeting so the Council could subsequently direct staff to take action at the following meeting. He reviewed that these items would include: the elimination of sales tax exemptions; increase permit/license and user fees; and place a utility franchise fee on the ballot. He explained his motion was not to enact these items but to request that staff give the Council more details on these options. Councilwoman Nicola SECONDED the motion. Mayor Beydler asked if staff could expand the research with regard to option#5 and include what the utilities were. Councilman Kavanagh explained he wanted more details on these options,as he did not fully understand what these options entailed. Councilman Kavanagh understood that the first option (increasing sales tax) was being considered already. He noted that he did not support Option #3, which was to utilize designated sales tax. Councilman Kavanagh confirmed that he did not support Option #6, which was the selling of town assets. He concluded that out of all the options listed he wanted more information on items 2, 4, and 5 although he was not taking any position at this time. Councilwoman Nicola AMENDED the motion to direct the town manager to bring back an in depth report as to how steps taken so far had impacted town services, address what solutions he had come up with to handle any situations that had risen from the changes being made, and a projection as to how much money would be saved in this current fiscal year. Councilman Archambault SECONDED the amendment. Councilman Melendez referred to the memo from the town manager dated December 11, 2002, which discussed the next stage of the financial plan. He pointed out that Mr. Pickering was not present tonight. He also noted that at a previous meeting Councilman Archambault had made a lengthy and detailed presentation on additional revenues. Councilman Melendez felt this issue needed to be reviewed with Mr. Pickering present. Councilman Melendez MOVED to continue this item until the next Council meeting. Councilwoman Nicola did not want to put this off for another two weeks. She stated she would welcome a friendly amendment but she wanted a report in two weeks. Mr. McGuire reminded the Council that a motion to continue took precedence over all other motions. The motion DIED because of the lack of a second. Councilman Kavanagh expressed that Councilman Melendez might be concerned that the Council would be placing a mountain of work upon the town manager. He was also concerned that might be too much work to do that quickly. He asked if there was a consensus of the Council that the first priority should be a progress report. He E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 8 of 10 questioned if there could be an understanding among the Council that if the town manager couldn't research these other things,that he would not have these additional three items for the next meeting. rr Mayor Beydler asked when the town manager would return. Mr. Ward replied Monday, January 06, 2003. Mayor Beydler asked how many days had it taken to put together the manager's first recommended budget cuts. Mr. Ward responded the Council had given him nine days. Mayor Beydler expressed now the Council was asking for ideas on diversified revenue sources and an update on the impact of the cuts. Councilman Archambault asked if staff had been looking at what the savings from the last round of budget cuts would be. Mr. Ward expressed that Mr. Pickering had been working with human resources to work out the process. He felt that Mr. Pickering could give some type of an update at the next Council meeting. Councilman Archambault noted that the Council would be at the retreat on January 7 and 8, 2003. He questioned if there would be any staff reports on any of that type of information. Mr. Ward explained that Mr. Pickering had not shared with him any reports that he would deliver. Mr. Ward stated that he had not spoken to the retreat facilitator. Mayor Beydler stated that the retreat would be an opportunity to ask questions of staff. Councilman Kavanagh stated he did not see how the Council could ask Mr. Pickering to do all of this work in two weeks since some of Mr. Pickering's time would be spent attending the retreat. He was not sure if this would be a quick research project for Mr. Pickering. He stated that if the Council could agree that the sense of the motion was "if' Mr. Pickering could research these additional three areas, the motion could be passed. Councilman Kavanagh did not want to hang Mr. Pickering if he did not have massive documents for the Council to review in two weeks. He affirmed that Mr. Pickering had his plate full with everything that was happening. Councilwoman Nicola explained that as far as her amendment went, a quick five-minute update would be fine. She noted that the agenda for the retreat included a morning session with department directors on the critical issues facing the town so she imagined there would be some discussion on the impact of the cuts. She restated she was not asking for a full-blown report, with charts and graphs. She was looking for a general overview of how bad the situation was and how were things going. Councilman Kavanagh asked that the amendment be moved. Mayor Beydler called for the vote on the amendment. The amendment CARRIED unanimously. Mayor Beydler called for the vote on the main motion with the amendment. The amended motion CARRIED unanimously. AGENDA ITEM#4- CALL TO THE PUBLIC. Fire Chief Scott LaGreca(Rural Metro), 14028 N. Sunflower He clarified a statement in the paper that had been attributed to the new committee. He thought the reporter had misquoted the committee chair. The paper printed that Rural Metro was under contract with Fountain Hills for$2.5 million through the end of the fiscal year and when the annual maintenance was included, the annual costs rises to $3 million. He stated that was incorrect. The contract right now between Rural Metro and the Town was $2,275,700. He commented that the Town kicks in $88,680 and Rural Metro had slashed $21,000 off that total. Projections show that Rural Metro could have another$20,000 savings by the end of the year in savings in fuel and parts costs. That would make the bottom line budget $2,343,000. He stated that the contract covered maintenance and maintenance was not $500,000. If the new fire district were formed, they would not pay $500,000 in maintenance on apparatus and buildings unless Rural Metro went out and bought 10 new fire engines and built 6 or 7 new fire stations. He remarked that this would be a very difficult process for the council, for the committee, for the people who would try to form the new fire district. He wished them all the luck in the world. He confirmed he was looking out for the best interests of the citizens of Fountain Hills because he lived here and was a taxpayer. He wanted to see what was best for the town. If this committee would like, he said he would be happy to sit down with them and explain what the town receives under this Rural Metro budget. He confirmed that he could direct them to other communities in the valley that were going through this same process so they could share in that information. He opened himself to the process so that they have good information to pass on to the citizens of Fountain Hills. He made the point that while he certainly respected the opinions of the honorable Councilman Archambault; he truly believed that he was carefully watching the chicken coop because even though he was a Rural Metro employee, he was first and foremost a Fountain Hills' citizen. He affirmed that the citizens would come first and foremost over Rural Metro. He hoped that Councilman Archambault had not meant that he was the fox in the hen i,`w house as he was watching over the responsibilities for as long as they have this contract. E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 9 of 10 John Cutillo He did not know where that information came from but he assured Fire Chief LaGreca it was not from him. Fire Chief LaGreca said it was the other committee. Councilman Melendez asked Mr. McGuire to introduce his new associate. Mr. McGuire introduced Carolyn Kusian,the new associate in his office. Mayor Beydler asked what her official title would be. Mr. McGuire responded that she would be listed as the assistant town attorney. AGENDA ITEM#5-ADJOURNMENT. Councilman Archambault MOVED that the Council adjourn and Councilman Melendez SECONDED the motion, which CARRIED unanimously. The meeting adjourned at 8:16 p.m. TOWN OF FOUNTAIN HILLS ' 11 By: % on Beyd e ,Ma r ATTEST: C� J. J Cassie B. Hansen, Director of Administration/Town Clerk PREPARED BY: / E. _.t Bev Bender,Executive Assistant 1111100, CERTIFICATION I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Regular and Executive Session held by the Town Council of Fountain Hills on the 2'd day of January 2003. I further certify that the meeting was duly called and that a quorum was present. DATED this 16th day of January 2003. Cassie B. Hansen, Director of Administration/Town Clerk E:\BBender\Documents\Current Minutes 2003\Regular Session 1-2-03.doc 10 of 10