HomeMy WebLinkAbout2003.0306.TCRM.Minutes TOWN OF FOUNTAIN HILLS
MINUTES OF THE REGULAR SESSION OF THE
FOUNTAIN HILLS TOWN COUNCIL
March 6,2003
Mayor Beydler called the meeting to order at 6:30 p.m. Following the invocation by Reverend Mark
Lansberry,The Fountains Methodist Church,roll call was taken.
ROLL CALL -Present for roll call were the following members of the Fountain Hills Town Council: Mayor
Jon Beydler, Vice Mayor Susan Ralphe, Councilmembers Rick Melendez, Leesa Stevens, Kathleen Nicola,
Michael Archambault, and John Kavanagh. Town Attorney Andrew McGuire, Town Manager Tom
Pickering, Public Works Director Tom Ward, Senior Planner Denise Ruhling and Bevelyn Bender, Town
Clerk, were also present.
AGENDA ITEM #1 - CONSIDERATION OF APPROVING THE MEETING MINUTES OF
FEBRUARY 6, 11 AND 20,2003.
AGENDA ITEM #2 - CONSIDERATION OF A PRELIMINARY PLAT FOR THE 2-UNIT KRALL
CONDOMINIUMS,LOCATED AT 14020 EDGEWORTH DRIVE,AKA PLAT 104,BLOCK 5,LOT
31, CASE NUMBER S2002-54.
AGENDA ITEM #3 - CONSIDERATION OF THE EXTENSION OF PREMISE/PATIO PERMIT
SUBMITTED BY JAMES R. ROONEY FOR THE SILVER STEIN, AT 17030 ENTERPRISE
DRIVE. THE PERMIT IS A TEMPORARY EXTENSION OF THE STEIN'S LIQUOR LICENSE
FOR THEIR ST.PATRICK'S DAY PARTY SCHEDULED FOR MARCH 17,2003.
Councilman Archambault MOVED to approve the consent agenda as read (Items 1-3) and Vice Mayor
Ralphe SECONDED the motion.
A roll call vote was taken with the following results:
Councilwoman Nicola Aye
Mayor Beydler Aye
Councilman Kavanagh Aye
Councilwoman Stevens Aye
Councilman Melendez Aye
Vice Mayor Ralphe Aye
Councilman Archambault Aye
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM#4- RECOGNIZE OUTGOING TOWN BOARD AND COMMISSION MEMBERS.
The Mayor commented on the fact that without volunteerism within the community, Fountain Hills' form of
government would not be what it is today. He said that he would like to take this opportunity to say "thank
you" to those individuals who served.
Mayor Beydler, on behalf of the members of the Town Council and the residents of Fountain Hills,
recognized the services of a number of individuals who have served on various boards and commissions
ibe without remuneration during the past year, as follows:
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page I of 23 3/20/2003
MR. JOE BILL, BOARD MEMBER, for his service on the Municipal Property Corporation, which sells
bonds for various Town projects.
MR. JOHN ROSENQUIST, COMMISSIONER, for his service on the McDowell Mountain Preservation
Commission, which worked to set aside the McDowell Mountain Preserve.
MS. GAIL PAPE AND MS. CHERYL MURRAY, COMMISSIONERS, for their service on the Community
Center Advisory Commission, which provides recommendations regarding the operation of the facility.
MR. TIM BROWN, MR. GEORGE WILLIAMS AND MR. MATT PAUL, COMMISSIONERS, for their
service on the Parks and Recreation Commission, which provides recommendations to Staff and the Mayor
and Council regarding recreation programs,parks and facilities.
Mayor Beydler expressed sincere appreciation to each of the individuals for their willingness to serve their
community through public service.
AGENDA ITEM #5 - RECOGNIZE LOVING FAMILY DENTAL AND ELITE PAINTING AND
WALL COVERINGS FOR THEIR SPONSORSHIP OF THE ST.PATRICK'S DAY EVENT.
The Mayor commented on the fact that due to budget cutbacks that took place during the month of
December, Staff, in an effort to conserve resources, canceled a number of special events that were typically
held in the Town of Fountain Hills in the past.
Mayor Beydler, on behalf of the members of the Town Council and Staff,and the residents of Fountain Hills,
recognized the contributions of the sponsors of the 2003 St. Patrick's Day Celebration at Fountain Park.
The Mayor announced that the sponsors of the celebration would be Loving Family Dental at Fountainview
Center and Elite Painting and Wall Coverings. He noted that the dyeing of the Fountain green on St.
Patrick's Day had become a tradition since the early 80's. He said that thanks to Tim and Lisa Loving and
Mike and Carol Martinez, this Fountain Hills' St. Patrick's Day will provide enjoyment for the many
residents and visitors at the park on Monday, March 17th. He commented that their generosity would make
this event possible despite the Town's current financial constraints.
Mayor Beydler expressed appreciation to Loving Family Dental and Elite Painting and Wall Coverings for
their willingness to serve their community through the sponsorship of this unique Town event.
AGENDA ITEM #6 - PRESENTATION BY MCO ON THE FORMATION OF A COMMUNITY
FACILITIES DISTRICT FOR ADERO CANYON.
Greg Bielli, President of MCO Custom Properties, stated that his company is interested in pursuing the
formation of a Community Facilities District (CFD) for the extension of Eagle Ridge Drive through Adero
canyon to the Town's trailhead. He said that discussions have taken place with Town Staff relative to
pursuing this type of district financing and indicated his intention, over the next few weeks, to work with
Staff on the preparation of a policy. He introduced two gentlemen who he stated possess extensive
experience with CFDs throughout Arizona, Bob Casillas, with the firm Stone & Youngberg, L.L.C. and
Michael Koveso, Bond Counsel. He said that they would highlight an educational presentation that would
outline the formation steps and operation of a CFD for Adero Canyon. He added that MCO viewed this as a
benefit to the community and stated that proceeding with Adero Canyon and providing access to the trailhead
would positively impact the entire community. He commented that Adero Canyon and Eagle's Nest would
be beautiful projects and represent outstanding, high-end quality custom lot communities. He advised that
MCO saw this vehicle as one more opportunity to help bring that project forward.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 2 of 23 3/20/2003
Bob Casillas highlighted a brief power point presentation on this agenda item and stated that CFDs are a very
common form of entity throughout the State, which had been utilized successfully by other municipal
jurisdictions, cities and towns, to finance various infrastructure. He noted that the Town of Fountain Hills,
back in the 1990's, formed a CFD with Eagle Mountain to finance those improvements. In addition, Prescott
Valley, Scottsdale, Prescott, and Litchfield Park also utilized this method of financing improvements. He
explained that the area that makes up a CFD is a "subset" of the jurisdiction creating the CFD and may
include noncontiguous parcels. He added that a CFD must be formed within the corporate limits of a City
(or in the County but only to finance school sites). He advised that CFDs were able to fund infrastructure
generally through the issuance of assessment bonds,revenue bonds or general obligation bonds.
Mr. Casillas explained that CFDs were governed by a Board of Directors and if the CFD was 600 acres or
less, the Town Council served as the Board of Directors. He noted that if the CFD was more than 600 acres,
then the Town had the option of appointing a separate Board of Directors. He pointed out that CFDs were
able to fund various infrastructure improvements, generally through the issuance of assessment bonds, which
were "liens against the property," and could be revenue bonds depending upon the type of improvements that
were being considered for the financing. He noted that they could also be General Obligation Bonds, which
were property taxes. He added that any debt issued by the CFD is the debt of the district and is not a legal or
economic obligation of the Town or the City that formed the CFD.
Discussion ensued relative to various infrastructure improvements that could be financed by CFDs, including
sanitary sewer systems, draining and flood control systems, water systems, roadways and parking facilities,
pedestrian malls, parks, public buildings, lighting systems, school sites and facilities, etc.; other powers
associated with CFDs, such as the acquisition of land, the establishment of debt service reserves, funding of
capitalized interest, refunding prior bond issues, spending monies for public infrastructure, entering into an
IGA (Intergovernmental Agreements) with the municipality on maintenance of public infrastructure and
enhanced municipal services; charging and collecting user fees and providing services outside of the district
if the City or Town agreed to proceed in that manner.
Mr. Casillas explained the process that must be followed in order for a CFD to go forward and said that the
filing of a General Plan would occur and that General Plan sets the general description of the infrastructure
that would be included within the CFD and the areas that would be improved. He noted that petitions would
need to be signed by the owners of 25% of the land to be included in the District and a Notice of Intention to
form a CFD would be mailed to those property owners who lived within the proposed District. He said that
if the City or Town, by resolution, considered forming the CFD, public hearings would be held to provide
citizens with the opportunity to learn about the CFD and to express their concerns and provide input. He
stated that the governing board resolution would be adopted ordering the formation of the District and, if
needed, there would be a vote of landowners and qualified resident electors in the proposed district. He
reported that each landowner voted a number of votes equal to the number of acres owned by that owner and
added that if the petition was signed by 100% of the landowners, a hearing and election was not required.
Mr. Casillas noted that a feasibility and benefits study would need to be conducted prior to construction or
acquisition of any public infrastructure. He pointed out that the required information included a description
of the public infrastructure, a map showing the project's location, a cost estimate (construction, maintenance
and operation), a schedule for completion, a map or description of the area to benefit from the project and a
financing plan. He explained that Districts formed by municipalities (not counties) might issue General
Obligation (GO) Bonds, subject to qualified resident elector approval, provided that there were no residents,
a landowner-controlled vote would take place. He advised that GO debt service was paid from an annual
property tax levy and added that the issuance of Revenue Bonds was subject to board resolution. He advised
that a property tax levy for maintenance and operation expenses was subject to the same vote approval as GO
bonds.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 3 of 23 3/20/2003
Mr. Casillas also discussed debt limitations and noted that indebtedness may not exceed the estimated cost of
public infrastructure improvements plus costs. He pointed out that outstanding indebtedness, for which the
full faith and credit of the District were pledged, might not exceed 60% of estimated market value of real
'44
property and improvements in the District. He noted that the District may levy an "ad valorem" tax on all
real and personal property in the District at a rate not exceeding the maximum rate approved at an election of
the qualified electors of the District. He stated that the portion of the tax attributable to the operations and
maintenance (O&M) might not exceed 30 cents per $100 of assessed valuation, unless approved at an
election after District formation. Mr. Casillas emphasized that the bonds issued to the CFD are tax exempt
and would be issued at a tax-exempt interest rate.
Mayor Beydler thanked Mr. Casillas for his presentation and asked whether the members of the Council had
any questions they would like to pose at this time.
Councilman Kavanagh asked how the debt was initially paid since there might be no property owners or very
few owners contributing based on the fact that only a small number of homes would be built at that point in
time. Mr. Casillas responded that this issue would be one of the considerations discussed up front in terms of
exactly who resided in the proposed District and the type of improvements that were being proposed for the
District as a result of the financing. He discussed absorption schedules that were conducted in an effort to
determine projected assessed valuation based on growth and anticipated growth. He added that a distinction
needed to be made as far as special assessment amounts because there would not be a property tax associated
with that. He said that over the years in Arizona we had seen that typically for special assessment bonds an
independent firm conducted an appraisal of that property and the market had historically accepted roughly
three to four times value. He pointed out that in order to issue$10 million in special bonds, it would have to
be proven through the special appraisal process that approximately $30 to $40 million in-appraised value
existed.
Councilman Kavanagh said that in this particular situation it was his understanding that MCO needed the
money up front to build the road. He added,for example, that if$10 million was initially borrowed in bonds lair
and it took MCO three years to build the road, during that first six months there might only have been two
out of five lots developed. He therefore questioned how the initial payments would be made based on the
limited number of people living there at that time. Mr. Casillas noted that a distinction existed between the
GO Bonds and the Special Assessment Bonds, where the value needed to be built up over time. He
explained that as part of the security or collateral, the Town would have put into place the ability, through
either assurances or guarantees, that the debt service($10 million would equate to approximately$500,000 in
debt service) and through those assurances, would be paid if a shortfall occurred. He added that in the case
of a property tax, if the tax failed to generate the necessary $500,000, standby contribution agreements or
other types of agreements would need to be in place to ensure that the shortfall was made up.
Councilman Archambault asked whether in this particular subdivision MCO could do partial roadwork in
order to avoid the necessity of doing a CFD. He said that the Town could allow MCO to complete a certain
amount of the roadwork and then the company could move on to the subdivision, so that lots could be built
and sold to fund the project, in a "forward movement" type of manner. Mr. Bielli responded that discussion
did take place relative to proceeding in this manner. He pointed out that one of the issues to be considered in
this particular case was the fact that MCO was simply looking at Eagle Ridge Drive because as Bob has
outlined, that is a public road and this mechanism could only be used for public infrastructure. He noted that
all of the streets off of this road that constituted the gated areas of this plan that the Council was familiar with
were all funded privately by MCO. He explained that as far as Eagle Ridge Drive is concerned, a
supplemental development agreement from the settlement agreement was in place and contained language
that recognizes that MCO needed to build Eagle Ridge Drive, complete with full improvements including
sidewalks. He added that the agreement even mentioned a number of improvements leading up to the
trailhead. He noted that the Town at that time was interested in getting the trailhead access together, and jtherefore full improvements were made part of the plan for that road.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 4 of 23 3/20/2003
Mr. Bielli added that the one road going up to the trailhead was basically split at the front, which could be
phased, but then the road narrows and turns into a single roadway up to the trailhead. He stated the opinion
that phasing would most likely be difficult although the thought process was a good one. He added that as
far as infrastructure went, it was not MCO's intent to finance the water in this program, since a private water
company was in place, but added that the road did need to be built in order to gain access to the half million
gallon storage tank located all the way up in the back of the canyon. He pointed out that this tank would
service the one parcel that was located out by the trailhead. He added that the only items that might be able
to be phased-in would be the sidewalk and landscaping, but taking into consideration the importance of
ensuring that a top notch quality job was done all the way up to the trailhead, it would be difficult to do as
good a job on a phased-in schedule. He advised that the development agreement would have to be revised
since the intent of the language contained in that document was to complete the road.
Councilman Kavanagh said that one of the problems he had with CFDs was that people looked at their tax
bill and said "this Town is taxing me to death" when in reality they were being taxed "half to death." He
added that the other half was the CFD money, and although it was billed as a tax, it was really a mortgage
payment because the people paid a lot less for their lot. He commented that the negative side of this was
when other needed taxes were requested; those citizens voted them down because they believe they were
already being over taxed. He asked if there was any way to set up a process whereby the entire contribution
to the debt would be paid by the owners on the day they closed on the property, so that the entire amount
would be included as part of the mortgage.
Mr. Bielli commented that full disclosure was required and the mechanism that they were leaning toward was
called the "special assessment" program previously discussed by Bob. He explained that the program would
have a mechanism in place where right up front an option would exist to pay off what was identified as the
debt assessment towards that individual lot. He added that the owner could pay that debt off right up front.
In response to question from Councilman Kavanagh, Mr. Bielli said that he did not know whether this could
be in the form of a mandatory requirement.
Mr. Michael Cafisco, an attorney, stated that the requirement could be mandatory but stated the opinion that
proceeding in this manner would defeat the actual purpose to a certain degree. He explained that anyone
obtaining a mortgage today was going to pay approximately 6% interest and these taxes and bonds typically
could be sold at rates less than that. He stressed the importance of allowing the homebuyer to take advantage
of the fact that even with an assessment bond,the buyer could deduct for income tax purposes that portion of
the assessment that was interest related,just as he could with his mortgage payment. He added that the rate
was going to be lower on the assessment bonds so it was more economical for them to not roll the debt into
their mortgage and leave it unpaid.
Mr. Cafisco added that when the Districts are formed, at the time of the primary sale only, they would
require anyone purchasing a property within the boundaries of the District to sign a waiver document,
acknowledging the fact that their property was located within the boundaries of the District. He added that
the company required them to sign and acknowledge that the property was being assessed and potentially
taxed for the payment of the infrastructure, which in this case would be the payment of the road. He pointed
out that the buyers were provided a sample of a typical monthly bill that was the result of being included
within the boundaries of the District and they were required to file this with the Town Clerk so that at least in
terms of primary sales, evidence existed that up front notification was provided and the owners signed off on
it. He stated the opinion that this process served as a very valuable tool.
Mayor Beydler asked Mr. Bielli to discuss the impact the CFD would have on his plans to move forward
with the Adero Canyon and requested that he outline his "backup plan" in the event the CFD was not in
place. Mr. Bielli said that the CFD represented an improved, enhanced financial option for the community,
for an improved road all the way up to the trailhead. He explained that this was not a community street, it
was a community amenity, and MCO viewed this as something that fell within the scope of the CFD. He
added that the backup option was one that would delay the financing of projects that were this high end in the
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 5 of 23 3/20/2003
marketplace today, based on the slow pace of today's marketplace. He commented on the fact that it was
difficult in today's economy to move forward and the CFD represented a vehicle that would allow the project
to be done "in house." He said that the backup plan would be to continue to work with financing institutions ,,
in an effort to identify a way to finance the project. He advised that conversations had taken place regarding
the possibility of looking at Eagle's Nest first. He reported that it had been MCO's belief that proceeding
with the road to the trailhead was a high priority and when the agreement was prepared, the trailhead was
identified as a high priority, and that is why Adero Canyon was identified as a high priority. He noted that at
the current time, plans were in the third and fourth review process and if the company had to come back and
ask the Council to now look at Eagle's Nest(which is a private, gated area) as another option, they would fall
a little bit further behind because they had made Adero Canyon their primary focus. He said that they would
most likely look at the option of continuing to review financing options or look at Eagle's Nest and request
that the Council consider Eagle's Nest as a possible alternative. He noted that this would require a
clarification in the development agreement for both parties.
Mayor Beydler asked what type of a timeframe MCO would be looking at in the event the CFD goes
forward. Mr. Bielli said that he had discussed this with Town Manager Tim Pickering and theoretically he
believed that an initial discussion of the policy would take place within a couple of weeks. He added that
this would be to ensure that MCO qualifies for the CFD under the Town. He said that they would like to
move quickly and obtain authorization at that meeting to proceed with securing the services of an appraiser.
He noted that this was an important step and must be done in order to address the valuation of the land as it
relates to the amount of the indebtedness. He pointed out that an application would also be filed during that
process and over the next couple of months a significant amount of work would be accomplished.
Mr. Bielli stated that should the CFD not go forward, he anticipated that the project would be delayed by a
number of months. He noted that an exact time couldn't be estimated because it would depend upon
financing issues.
In response to a question from Councilman Archambault, Mr. Bielli explained that Eagle's Nest was the
second part of the settlement agreement, and consisted of 244 lots off the Golden Eagle and Cholula area(the
two entrance roads). He advised that the entire subdivision would be gated and therefore did not qualify for
a CFD. He added that the settlement agreement basically defined property, and both properties (Adero
Canyon and Eagle's Nest) were listed in the beginning of the agreement. He explained that there was a
provision that related to this road and it could be defined as this road being Eagle Ridge Drive extension and
only being related to Adero Canyon. He stated that if the Council was willing to define property as being
Adero Canyon that this road that was being improved relates to, and then they could proceed with Eagle's
Nest. He added that both parties would want the settlement agreement clarified. He pointed out that the
intent was for the road to be put in and completed before a Certificate of Occupancy was issued for the
property because the mission at that time was to get Eagle Ridge Drive improved up to the trailhead. He
commented that they did not view forming a CFD simply because of the financing, but also because it would
comply with that portion of the settlement agreement that focused on the completion of this road and benefit
the community.
Mr. Bielli noted that Eagle's Nest does contain a trailhead entrance right at the end of Golden Eagle
Boulevard, which is actually located outside of the gates. He advised that pedestrian access through the
subdivision also exists on the extension of Golden Eagle up to where the old saddle club was and explained
that was where people could enter through the gate. He noted that no formal trailhead existed as it was
envisioned in Adero Canyon and explained that Adero Canyon's trailhead was further up the property, and
contained restroom facilities.
Councilman Archambault asked why the agreement would have to be modified if they were simply talking
about Adero Canyon. He added that if they got up into Eagle's Nest north, the whole loop road would be put
in. Mr. Bielli confirmed that they would put the entire loop road in and that it was part of the plan.
Councilman Archambault stated that he thought he saw a trailhead or access off that loop road. Mr. Bielli
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 6 of 23 3/20/2003
said that at the beginning of the loop road, at Golden Eagle, a parking area existed but noted that it was not
within the project. He reiterated that the settlement agreement would need to be clarified if they decided to
`110, start there and move on at a later time.
Mayor Beydler thanked Mr. Bielli and all of the other speakers for their input regarding this agenda item.
Mr. Bielli said that he was willing to work with Staff and awaited hearing from the Council on this matter.
AGENDA ITEM #7 - CONSIDERATION OF A RESOLUTION 2003-08 REGARDING A
DEVELOPMENT AGREEMENT BETWEEN THE TOWN OF FOUNTAIN HILLS AND
FOUNTAIN VISTA PROPERTIES L.L.C. REGARDING DEVELOPMENT CONSIDERATIONS
FOR A PORTION OF FINAL PLAT "FOUNTAIN HILLS RESORT" LOT 1.
Councilman Archambault MOVED that the Development Agreement be accepted based on a few
revisions/stipulations.
Councilman Archambault stated that in reviewing the Development Agreement, he noted that the Town was
requesting $371,000 from the developer for the purchase of a hillside protection area, while the developer
was requesting nothing in return. He indicated his intention to put this issue into perspective and said that
when you look at what other developers had paid per square foot for hillside protection disturbance, such as
the Barkley Group that developed the Four Peaks Plaza where the Target store was built; their cost was a
total of 73.8 cents per square foot. The Town also gave that group a concession, consisting of abatement in
the amount of$986,000,for improvements.
Councilman Archambault stated the opinion that in this case, an unfair situation existed based on the fact that
the developer was not asking for anything from the Town but was willing (as part of the requirements) to
(11610 give the Town $50,000 to help improve Shea Boulevard and in addition, the Town asked for another
$371,000.
Councilman Archambault said that included in his motion to accept this Agreement, he would like to add an
amendment, in an effort to be fair to the developer,to the effect that the developer must come up with a total
of$200,000, $50,000 of that to be used for Shea Boulevard improvements with the remaining$150,000 to be
paid as part of the hillside disturbance cost. He stated the opinion that when this issue was put into
perspective,the proposed amended amounts were fair and appropriate.
Councilman Archambault stated that he would also include in the motion a stipulation calling for half of the
funds to be paid at the time ground breaking took place and that the balance be paid at the time the developer
was issued his first building permit.
Mayor Beydler clarified that Councilman Archambault was making a motion to approve modifying the
amount to $200,000, with $100,000 payable at grading and the remaining $100,000 payable when the
developer's first building permit is issued.
Mayor Beydler SECONDED the motion.
Councilwoman Stevens questioned the proposed amendments and noted that the developer had already
agreed to pay the amount currently listed in the agreement. She indicated that she did not support the motion
containing the amended cost and stated the opinion that the proposed cost revision would set a precedent of
"going backwards." She added that if the developer had contested the amount, an entirely different situation
would exist but this was not the case and she did not support changing the amount.
Councilman Archambault commented that if the developer had not signed the agreement, they would not be
discussing the issue tonight. He added the opinion that the'developer signed the agreement because he felt it
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda doe Page 7 of 23 3/20/2003
was the only way he would be allowed to proceed with the project. He said that he did not believe that the
Council was taking into consideration all of the concessions made by the developer.
Councilman Kavanagh requested that Staff provide a brief update on this issue and the methods used in
calculating the costs that were included in the current agreement.
Town Manager Tim Pickering noted that a figure of$1.00 per square foot was used to arrive at the price and
noted that this was the figure that was used in calculating other similar use projects and developments such
as hotels and condominiums, which paid the $1.00 per square foot rate for their use of the HPE. He added
that Staff did not feel that the price paid by Target was comparable based on the fact that the project
represented a different use, retail, and the Town believed it was important to provide incentives in order to
ensure the development of this project. He added that the Southwest Inn also paid$1.00 per square foot.
Councilman Melendez asked whether this type of procedure was typical and whether the Council may legally
change the cost figure as part of the motion. Town Attorney Andrew McGuire advised that the development
agreement was the legislative decision that the Council would render this evening and added that until that
decision had been made and approved by a majority vote of the Council, discretion existed to offer
amendments. He noted that Staff worked diligently in an effort to arrive at an agreement they felt was
amenable to both sides but reiterated that the Council had the discretion to amend the contents of that
document should the members decide to proceed in this manner.
Councilman Archambault pointed out that the Southwest Inn purchased 6.9 acres of land at a cost of
approximately $1.00 per foot. He added that they probably would not have had to buy that land if Barkley
had not bought up all of the washes for preserve purposes. He stated that in accordance with Town
ordinances, if there was no land to be purchased there was no set amount and added that Barkley only bought
what they had to buy. He said that in this case, the developer was not asking for anything, he was not asking
for variances or major concessions, simply to be able to build on his property. Councilman Archambault
stated the opinion that at the current proposed rate, the Town would be over-charging the developer and
asked the Council to be fair in this matter.
Councilman Kavanagh stated that based on the fact that there was an agreement on the part of Staff and the
developer, the fact that the "going rate" does in fact appear to be $1.00 per square foot, and the fact that this
would only go into effect if certain other motions were approved this evening, which would provide a
number of concessions to the developer, he would MOVE to amend the motion to restore the original figure
in the amount of$371,567. Councilwoman Nicola SECONDED the amendment to the motion.
Mayor Beydler clarified that Councilman Kavanagh's motion was to restore the agreement to reflect Staffs
recommendation but asked whether the amendment related to the other items contained in the original
motion, such as the proposed payment schedule.
Councilman Kavanagh stated that based on the fact confusion existed, he would like to offer an amendment
to his motion that the Council return to the original agreement, as recommended by Staff. He added that
should the Council wish to discuss different payment options, those issues might be addressed in a separate
amendment.
Mayor Beydler again clarified that Councilman Kavanagh was amending one item in the motion, the item
pertaining to the dollar amount.
The Mayor asked if there were any citizens in the audience wishing to speak on this issue and Town Clerk
Bevelyn Bender advised that she had received speaker slips for Agenda Item #7. She asked whether the
Mayor would like those citizens to present their remarks at this time. The Mayor said that the speakers
would address their remarks once the discussion returned to the main motion on this agenda item.
Mayor Beydler called for the vote and asked for those in favor of the amendment to restore the original
amount of$371,567, versus$200,000, to signify by saying Aye.
E:\BBender\Documents\Current Minutes 2003'Regular Session 3-6-03 agenda.doc Page 8 of 23 3/20/2003
A roll call vote was taken with the following results:
Councilwoman Stevens Aye
Councilwoman Nicola Aye
Vice Mayor Ralphe Aye
Councilman Melendez Aye
Mayor Beydler Nay
Councilman Kavanagh Aye
Councilman Archambault Nay
The motion CARRIED BY MAJORITY VOTE (5 to 2), with Mayor Beydler and Councilman
Archambault voting Nay.
The Mayor stated that the Council would now vote on the original motion but first asked whether citizens
would like to provide input.
John Hines, 15118 East Vista Drive
Mr. Hines addressed the members of the Council and said that he was the President of Westridge Village
Homeowners' Association, which was the residential community located directly adjacent to the proposed
project. He said his purpose in speaking tonight was to convey some of the residents' concerns. He added
that the residents understood that the development of a Hilton Hotel in Fountain Hills was very appealing in
terms of increasing the Town's amenities and providing needed revenue. He said that the Westridge Village
homeowners had no objections to the plan for a hotel as originally submitted; however, with the latest
proposal, which had escalated to include three tiers of three-story, multi-family townhouses, the residents
were greatly concerned about the impact this would have on their properties. He commented that additional
concerns included light pollution, noise pollution, a major increase in traffic, and the appearance of the
townhouses that were proposed to be built down the hillside on land that was zoned "hillside protected."
Mr. Hines said that he spoke for all of the homeowners when he stated that they supported abiding by the
Hillside Protection Ordinance, which was established to protect the desert hillside and the beautiful vistas
that were enjoyed by all. He added that this was an important asset that attracted and kept homeowners in
Fountain Hills. He noted that due to the importance of this project to Westridge Village homeowners, they
met recently with Mr. Hulpach to discuss the situation and a number of verbal concessions were made. He
added, however, that if the decision was made tonight to forsake the Hillside Protection Ordinance, the
residents asked that the Council required the developer to provide adequate landscape screening on his
property to protect their community from light and noise pollution and to ensure that a minimum distance of
576 feet existed between any townhouse built and Westridge Village. He pointed out that the 576 feet was
agreed to because that was the distance outlined in the original hotel proposal.
Mr. Hines also addressed the issue of traffic safety and noted that in the development agreement reached
between the Town and the builder of Westridge Village, who at that time was New American Homes, the
entrance to their subdivision was approved without a deceleration lane and noted that even now this presents
a dangerous situation. He stated that with the additional traffic that Mr. Hulpach's project would generate,
this danger would be greatly increased and therefore if this project passed, the homeowners asked that the
Town earmark early revenue received from the project to provide a deceleration lane on Palisades Boulevard
into Vista Drive to help alleviate this situation.
William Lyons, 10818 North Rosemont Court
Mr. Lyons addressed the Council and thanked the members for their ongoing service to the community. He
referred to an article that appeared in last week's Fountain Hills'Times, that asked the Council to approve the
rezoning required for the Shea/Palisades parcel. He noted that the article also stated that the site had been
master planned as a "resort hotel for many years" long before any residential neighborhoods were built in the
E:\BBender\Documents\Current Minutes 2003Utegular Session 3-6-03 agenda.doc Page 9 of 23 3/20/2003
vicinity. He stated that when he purchased his home in November of 1998, the zoning allowed for the
construction of a commercial hotel. He added that he believed this is what the purchasers of the lots and
homes in Westridge Village, Crestview and the immediate area believed was a legally planned use for the
area. He said they bought their lots and built their homes and the homeowners could not change their zoning
now. He added that the realization that the Council could rezone a parcel that affected so many and strip part
of an HPE was extremely upsetting.
Mr. Lyons stated that despite the fact that the Council had rezoned HPEs in the past that did not make it
right. He said that perhaps his mistake was in believing that the Council would stick to their original
commitment for a hotel complex and questioned how the Council could make decisions and then turn around
and change them with the stroke of a pen.
Frank Ferrara, 16411 East Glenbrook
Mr. Ferrara stated that he is the Executive Director of the Town of Fountain Hills' Chamber of Commerce
and was speaking on behalf of over 500 business owners. He noted that he had requested that he be allowed
to speak in excess of the typically allowed three minute time period. Mr. Ferrara stated that he had also
recently been appointed to the position of the Fountain Hills' Chamber of Commerce Business Advocacy
Chairperson and, in that capacity, he had the obligation to look into matters affecting the Chamber's
constituents, based upon any matter, and to report back to the Council and to the Board. He added that this
was basically why he was present this evening, in the capacity of a business advocate,ombudsman.
Mr. Ferrara stated that he had in his possession a copy of a Resolution that was unanimously passed by the
members of the Chamber of Commerce Board of Directors on January 22, 2003, that he would like to read
into the record. He added that prior to that, he would like to discuss Agenda Item #7, the Development
Agreement between the Town of Fountain Hills and the developer. He noted that this issue was on the
agenda of a previous Town Council meeting and discussed and debated in great depth. He said that he
attended that meeting and it was his understanding that the Council directed the applicant and Staff to meet
in an effort to put together a developmental agreement for presentation to the Council at their next meeting.
He stated the opinion that Staff and the developer complied with the Council's request and they had before
them this evening the results of those discussions.
Mr. Ferrara commented that in his capacity as Business Advocate, he had the opportunity to sit in on the
negotiation sessions and stated the opinion that the discussions were extremely succinct and "tough." He
expressed the opinion that the applicant, Mr. Hulpach, felt that the amount of money that was being
discussed was an extremely difficult situation to overcome and believed that it would not be in his best
interest to attempt to lower that amount if he wanted the project to go forward this evening. He added that
the negotiations went forward in a positive manner and Staffs flexibility as far as a payment schedule
became apparent. He noted that this point, as well as just about every other point raised during the
negotiations, was agreed to by Town Staff and the applicant. He reported that at the end of the negotiations,
it appeared that an agreement had been reached and the question was asked whether or not the original denial
would be "supplemented," not changed, with the facts as they were stated at that meeting and the answer was
"no." He said that this was the only question he asked and the reason why he asked it was to determine the
logic that was being used.He indicated that he still did not understand the logic.
Mr. Ferrara informed the members of the Council that he was present to defend Agenda Item#7, relative to
the contents of the Development Agreement, and stated that all of the points that had been discussed up to
this point were contained in that agreement. He added the opinion that the applicant had "bent over
backwards" to meet the Town's demands and noted that the project would result in very significant positive
financial impacts on the entire Town.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 10 of 23 3/20/2003
Mr. Ferrara presented the Council with a copy of the Resolution in support of the construction of the Hilton
Resort located at the corner of Palisades and Shea Boulevard in Fountain Hills. (A copy of the Resolution in
on file in the office of the Town Clerk.)
Michael Downes, 16616 East Palisades
Mr. Downes addressed the members of the Council and stated the opinion that it was obvious that practically
everyone supported the development of the Hilton Resort. He added that if this was the process that the
Council believed must be followed in order for this to occur, he supported the process. He noted that he had
read the agreement and said that there were basically two points that he would like the Council to consider
and verify. He pointed out that Article 3 of the agreement stated that the owner may develop this property in
accordance with the conceptual site plan. He added that this conceptual site plan, as presented so far, had
many problems and as long as the developer understood that this plan was subject to some variations in order
to comply with the Town's Ordinance, then that was fine. He said, for example, the maximum number of
rooms allowed under this zoning was 15 per acre and if there were 13.13 acres of L-3, that figure would be
197 rooms. He reported that the conceptual plan reflected a total of 214 rooms or 17 rooms above the
allowable number and a violation of the Ordinance.
Mr. Downes added the opinion that the engineering as shown in the agreement was incomplete and changes
might be warranted due to this fact. He reiterated that as long as Mr. Hulpach was aware that there might be
some changes to this conceptual plan, and it might not be approved exactly as he had presented it, the
proposal was acceptable and should go forth. He said that the second point he would like to make was that
the number one priority should be the construction of the actual resort. He stated that Article 10 locks the L-
3 zoning in for a period of ten years and Paragraph F under "Recitals" indicates that this agreement was
binding on both parties and all their successors and interests and assigns. Mr. Downes stated that he hoped
that this meant "any new owners" and asked, for example, if in two years Mr. Hulpach decided that the resort
community was not ready for any more construction, and wanted to sell the land and walk away from it,
would he remain bound by the agreement and/or would the new owner if he did in fact sell the property.
Mr. McGuire responded to Mr. Downes' question and stated that the term referred to by Mr. Downes in the
agreement was meant to legally bind anyone who becomes interested in that property throughout the entire
term of the agreement.
Tim McWeeney, 12835 North Ryan Way
Mr. McWeeney congratulated Staff and the development on reaching an agreement. He said that he was
openly critical of Mr. McGuire at the last meeting and would now like to openly praise him for his assistance
in resolving this issue and allowing it to come forward this evening. He also congratulated the Mayor and
members of the Town Council on the historic vote that they would cast tonight and said that their vote of
approval would help bring the Town of Fountain Hills to the next level of high-quality development. He
noted that not everyone supported the resort but added that many who opposed it did so for personal reasons.
Mr.McWeeney noted that the Fountain Hills Times had spoken out in support of the project and the rezoning
on two separate occasions, the Chamber of Commerce and its Board of Directors, by unanimous Resolution,
supported the rezoning and the project, the members of the Planning and Zoning Commission supported the
proposal as well as the Tourism Council. He said that he too supported proceeding with the project for no
personal or business related reasons other than he was a member of the Chamber's Board of Directors and he
viewed this project as being the greatest hope for the economic "shot in the arm" that the Town of Fountain
Hills so desperately needed. He urged the Council to vote in support of this issue and bring the Hilton Resort
to life in Fountain Hills and make it a domestic and international destination for business and leisure travelers
alike.
Roy Kinsey, 17120 East Fairway Street
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page I I of 23 3/20/2003
Mr. Kinsey addressed the Council and commented on the hard work and diligence that had been
demonstrated on the part of Town Staff as well as the Council and the developer in an effort to reach a
mutually acceptable agreement. He stressed the importance of ensuring that the Town continued to walk the ,„,g)
fine line of balance between the encouragement of development and recognition of the importance of open
space preservation. He added that ordinances were in place to accomplish this and, in this particular case, the
Town was to be commended for their negotiation efforts, which resulted in holding strong on the Hillside
Protection Ordinance and recognizing that both could be accomplished at the same time.
Mayor Beydler thanked the citizens for their comments.
Councilwoman Stevens asked the applicant, Vladimir Hulpach, whether he had plans for OSR in the future.
Mr. Hulpach responded that he did not and explained that he never in fact had plans for OSR and has
consistently stated his position. He added that although the OSR zoning would allow him the ability to
develop an executive golf course, including a clubhouse, he had no plans to do so and in fact he planned to
concentrate instead on the development of a system of hiking trails and the construction of a couple of
gazebos. He added that if the community were interested in "connecting" the hiking system to their
community, he would willingly pursue that as well. He further stated that as a result of a request received
from the Homeowners' Association, he agreed to stipulate in writing that he would not pursue OSR zoning
and added that he later provided the Director of the Homeowners' Association a draft copy of such an
agreement, drawn up by their attorney, which covered a period of 20 years. He advised that the agreement
was acceptable to the Homeowners'Association and he had their acceptance of that agreement in writing.
Mr. Hulpach said that the proposal was presented at the Planning and Zoning meeting, and he heard from the
residents of Westridge subdivision that no one was even aware of the request or the resulting agreement that
was reached. He said that the residents added that authorization to pursue that issue was not bestowed upon
any member of the Board and Mr. Hulpach stated that he was both upset and confused by this discrepancy.
He added, however, that he was willing to state once again this evening for the record that he would sign the
agreement, (subject to Council approval) copies of which were contained in his file, but he emphasized that
he still had not heard from Mr. Hines, the President of the Homeowners' Association, that the Association
even cared whether this happened. He noted that Staff had recommended that the agreement be strictly
between the Westridge Homeowners' Association and Fountain Vista Properties and that was how the
agreement had been prepared.
Councilwoman Stevens also commented on the multi-family component of the project and asked why that
element is necessary for the overall success of the project. She added that when the proposal first came
before the Council, it was going to strictly be a resort. She asked whether the developer owned the land and
if he would lease the resort portion to Hilton or whether the he would develop the entire project and was
therefore seeking financing as a result of the multi-family component, in an effort to pay for the
infrastructure.
Mr. Hulpach responded that Fountain Vista Properties owned the entire 60 acres and explained that times had
simply changed. He added that the company lost their financing as a result of the aftermath of the 9-11
tragedy. He noted that Mr. Greg Francois, Vice President of the Western Region of Hilton Hotels
Corporation, based in Beverly Hills, California, was once again present at this meeting and was much more
qualified to respond to these questions. He said that before Mr. Francois addressed the Council, he would
like to state that any new resort of this size, and even more importantly of this high standard, must include
some type of residential component in order to ensure its ultimate success.
In response to a question from Councilwoman Stevens as to whether Hilton Corporation currently had or
planned to do any other resort/condominium projects, Mr. Francois stated that in 1973 the Scottsdale Hilton,
off McDowell and Scottsdale Roads, was developed in a very similar manner with the hotel up front and
directly behind it, the Hilton Villas. He noted that this very same vehicle was created to generate equity and
up-front dollars to ensure the viability of the project. He added that a few weeks ago, Hilton signed an
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 12 of 23 3/20/2003
agreement with the City of LaQuinta, California, for a 176-room Embassy Suites project, surrounded by 150
casitas. He noted that the casitas would be pre-sold and put back into a rental pool that can be used by the
hotel system as guest suites. He discussed other similar projects in Florida and California and stated that
these types of projects will be seen more and more as a result of the difficult economic times developers are
facing. He reported that Hilton currently had 17 similar proposals that include hotels/villas, casitas and/or
condominium type components.
Councilman Archambault commented on the fact that the proposal was actually a partnership/franchise deal
and asked Mr. Francois to confirm that the owner of the franchise was in fact Mr. Hulpach. Mr. Francois
confirmed this fact.
Councilman Kavanagh noted that the Homeowners'Association listed three concerns and asked Mr. Hulpach
whether these concerns had been addressed. Mr. Hulpach responded to questions relative to the manner in
which the Association's request for a 576-foot buffer between structures contained on the hotel property and
the subdivision as well as their request for specific landscaping has been addressed. He referred to
renderings of the project displayed in the meeting room and said it was his understanding that everyone was
amenable to a compromise solution that was discussed at a meeting held between all involved parties. He
provided an overview of the final agreement that was reached between the developer, town Staff and the
members of the Homeowners' Association relative to the placement of the units and the development of a
buffer zone.
Councilman Kavanagh also commented on the Homeowner Association's request for the development of a
deceleration lane and asked how Staff would determine whether one was needed and the manner in which
Staff would pursue this request.
Public Works Director Tom Ward stated that Staff did review this situation when discussions were occurring
with residents as well as the developer and said that at that time they indicated that Staff would have to
review a revised traffic report based on the fact that the site had change since the development of the original
report. He added that Staff advised at that time that when the improvement plans were submitted, this issue
would be addressed. He confirmed that nothing would be approved unless it was first determined that a safe
traffic situation would exist.
Mr. McGuire commented that the exhibit list, attached to the agreement, was accurate and the "no build
easement area" was depicted in a separate Staff generated exhibit but never was included as part of the
conceptual site plan because of the extensive work involved and the limited time allowed. He noted that
Staff would update all of the exhibits so that they matched the agreement. He added that the text was correct
but the exhibits still had to be inserted and the ones attached to the agreement and contained in the Council
packets were not the final exhibits.
Mayor Beydler stated that this process had been a tenuous one to say the least and added that he knew it had
been both a difficult and frustrating process for Mr. Hulpach as well as the residents. He agreed with
Councilwoman's Stevens' previous comment that the price of doing business in Fountain Hills was
sometimes challenging. He congratulated all parties, including Staff, on their diligence and negotiation
abilities. Mr. Hulpach commented that he was very pleased with the final outcome that was being presented
this evening but agreed that the process had been an extremely frustrating one. He commented on the fact
that this $56 million proposal represented a major project for the Town of Fountain Hills and stated the
opinion that Staffs decision to recommend denial of the project indicated to him that they did not understand
or recognize the importance of this project to the entire community. He added that the tax revenues that
would be generated from the hotel during its third year of operation, in addition to taxes placed on local
spending, were estimated to reach $577,000. He noted that he had never requested any tax concessions and
did not intend to do so now. He commented on the fact that perhaps he could have performed better in the
negotiations area but said that he was willing to proceed with the proposal as agreed.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 13 of 23 3/20/2003
Mr. Hulpach also indicated his intention to appear before the Council along with his colleagues on the
Tourism Council and to conduct an in-depth presentation, study and report on the importance of tourism on
this community.
Mayor Beydler commented that he previously instructed Mr. Hulpach not to sign any document that he was
not ready, willing and able to abide by and asked Mr. Hulpach at this time to state whether the proposal
currently before them is one that he could live with.
Mr. Hulpach confirmed that he was ready, willing and able to live up to the terms of the agreement before
them at this time, despite his dissatisfaction with the process and some of the terms.
In response to a question from Councilwoman Nicola relative to projected occupancy rates during the hotel's
third year of operation, Mr. Hulpach reported that the company anticipated achieving occupancy rates that
begin in the 51% range and peak at the 69%range. Mr. Hulpach also noted that the figures previously stated
by him did not include revenues that would be generated as a result of the rental of the villas or caritas.
Vice Mayor Ralphe indicated support for proceeding with the project. She commented on the difference that
existed between preservation and hillside protection easements and noted that the easements were at issue in
this particular project. She noted her strong support for large-scale preservation of mountain hillsides and
down-sloping sides of the Town's washes. She added, however,that this evening they were not talking about
the preservation of hundreds of acres of washes or about the establishment of a mountain preserve. Those
issues had already been addressed. She said that tonight they were considering the use of a parcel of land
that was going to be developed and even if a decision were made to designate 9.91 acres of that parcel of
HPE land, it would still be an allowable use for lodging property.
Vice Mayor Ralphe stated the opinion that HPEs were vitally important and key to the wise development of
the Town's land but added that so was the big picture. She added that in this particular case she believed that
the overall benefits to the Town, to its people, to tourism, to economic well-being, lay in approving this
resort and the villas.
Councilman Kavanagh commented on the fact that two speakers had alluded to a negative recommendation
being received from Staff and said that he would like to read the last word from Staff contained in their
report. He read, "for the good of the community, Staff felt that the project should move forward." He added
that this should be part of the record.
Councilwoman Stevens stated that to follow up on Councilman Kavanagh's comments, she found that part to
be slightly confusing and had a discussion with the Town Manager on this issue. She said that she
remembered looking at this project three years ago and thinking that it was "pushing the boundaries" at that
time and was not happy about it. She added that it had been "pushed a little more" this time around and now
they were considering selling HPE to accommodate that. She commented that she was somewhat troubled
by this fact, not so much in relation to this particular project, although it did impact the residents, and
wondered where they could possibly go in the future. She stressed the importance of having some type of
policy in place containing specific criteria to assist them in determining in the future when it would and
would not be appropriate to sell off HPE. She added that she would like to open a discussion relative to
directing Staff to pursue the development of such a policy.
Councilwoman Stevens referred to Page 5 of the Development Agreement, and said that under Section 10,
Part 6, it states "commencement of construction of a substantial portion of the hotel structure" and expressed
the opinion that the words "substantial portion" was vague and open to interpretation. She requested input
from the Town Attorney regarding this language.
Mr. McGuire stated that this issue was discussed at the Staff level and the goal was to reach some type of NJ
"common ground." He said that Staff was as comfortable with the language contained in this Section as
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 14 of 23 3/20/2003
possible in an agreement such as this and noted that penalty clauses were also included in the document to
serve as "incentives" for moving ahead at an appropriate and desirable rate of completion.
Le
Councilman Archambault commented that he previously asked who the owner of the franchise was in order
to bring out one very important point, the fact that they were not talking about a developer coming into
Fountain Hills, building a one-shot project, and then leaving. He said that Mr. Hulpach was the owner of the
franchise and would be part of this community for a very long time.
Mayor Beydler requested that the Council vote on this agenda item.
Councilman Melendez requested clarification as to what the Council was voting on at this time. The Mayor
explained that they would now vote on the original motion. Mr. McGuire confirmed that the Council would
vote on the development agreement as presented by Staff.
A roll call vote was taken with the following results:
Vice Mayor Ralphe Aye
Mayor Beydler Aye
Councilman Melendez Aye
Councilwoman Nicola Aye
Councilwoman Stevens Aye
Councilman Archambault Aye
Councilman Kavanagh Aye
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM #8 - PUBLIC HEARING TO RECEIVE COMMENTS ON RESOLUTION 2003-041
A PROPOSED AMENDMENT TO THE TOWN OF FOUNTAIN HILLS GENERAL PLAN THAT
WOULD CHANGE THE LAND USE MAP FROM THE DESIGNATIONS OF "LODGING" TO
"MULTI-FAMILY RESIDENTIAL HIGH DENSITY" ON A PORTION OF FINAL PLAT
"FOUNTAIN HILLS RESORT" LOT 1. CASE NUMBER GPA2002-01.
Mayor Beydler opened the public hearing at 8:20 p.m.
Robert Belaski, 15227 East Redrock Drive
Mr. Belaski stated that all of his comments were directed towards the entire Development Agreement, i.e. the
Planning and Zoning, multi-family, high density and basically everything. He noted that this project was
zoned back in 1999 as a resort project and it had changed dramatically since that time. He commented that
the residential component now abandoned the Hillside Protection Easement, which was extremely important
to the Town of Fountain Hills. He urged the Council not to abandon it in the future and to ensure that the
Town did not wind up looking like the City of Scottsdale, where homes and businesses were "stacked" on top
of each other.
Mr. Belaski thanked Planning and Zoning Staff, the Town Engineer, Mr. Hulpach and Mayor Beydler for
their time and said that he attended many of the contentious meetings that led up to this point. He noted that
extensive effort was expended to reach a compromise between the residents of Westridge Village and the
developer and commented on the fact that just three weeks ago, meetings were being held to arrive at a
compromise on the proposed residential component. He added that a majority of the people in attendance,
even at this evening's meeting, had no idea of the effort that went into those last minute meetings and the
changes that took place as a result of those negotiations. He emphasized that the residents of Westridge
Village were never opposed to the resort agreement, but explained that the rezoning was completely different
from when they originally moved in.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 15 of 23 3/20/2003
Mr. Belaski discussed the resident's original contention and noted that Mr. Hulpach had made various
exceptions in an effort to retain the 576 foot line of sight and, in addition, he had given his verbal assurance ,,
that he would sign the already drafted agreement between the Westridge Homeowners' Association and
Fountain Vista Properties, stating that he would not build in the OSR. He requested that this agreement be
signed this evening, notarized, and made part of the public record as of tomorrow to maintain the OSR for a
period of 20 years as previously discussed and agreed upon. He commented that this issue attested to the fact
that with open communication between residents and developers, compromises could be achieved to benefit
all parties involved. He added that although the Association would have preferred that the HPE be
maintained,the compromise made the project more palpable.
Rebeka Falkner, 15207 East Redrock Drive
Ms. Falkner addressed the Council and expressed concerns relative to changing the lodging to multi-family
density. She stated the opinion that this would result in giving the developer "free range" and added that if
they allowed this to occur, the result might be that no hotel is developed in the end and multi-density would
spread throughout the entire area. She noted that the intersection of Palisades and Shea was the first entry
into Fountain Hills and added multi-family development was not appropriate for Fountain Hills and would
ultimately result in negative impacts on the entire community. She said that she had no problem with the
resort itself and urged the Council to take a close look at this situation and the ramifications that would result
if they chose to allow multi-family development to take place.
Ms. Falkner said that there were no plans in place for this development and they were lacking definition. She
suggested that a vote on the issue be delayed until they knew exactly what the Council would actually be
voting on. She said that if the Council did proceed with the vote, she would like to know what distance
would exist and questioned whether a minimum or maximum distance had been established between the
multi-family development and the adjoining homes.
In response to a question from Councilman Archambault, Mr. McGuire confirmed that the rezoning was for
9.91 acres of the existing L-3. He added that this action, if approved, would reduce the L-3 by 9.91 acres and
noted that multi-family residential would not be allowed anywhere other than within the 9.91 acres.
Vice Mayor Ralphe asked whether there was any action that the Council could take this evening to ensure
that the remainder of the OSR would remain OSR as stated by the developer. Mr. McGuire stated the
opinion that this issue fell under the domain of the developer and added that the OSR area was also HPE and
therefore contained an additional constraint.
Councilman Kavanagh commented on the fact that the only way the OSR could be developed was if the
current or future Town Councils voted to approve it. He noted that the Council possessed a "veto"right over
any development.
Councilman Archambault asked whether the OSR was part of the Hillside Protection Easement that was
calculated when they figured the hotel and the casitas. Senior Planner Denise Ruhling concurred with the
comment presented by Councilman Archambault and said that the original 60-acre development was
"broken" into two pieces, one just over 23 acres, and the other 36 acres which represents the surrounding
OSR. She noted that the 36-acre area was designated as HPE as well as 8.53 acres of the site that they were
talking about at this time.
Mayor Beydler closed the public hearing at 8:29 p.m.
AGENDA ITEM #9 - CONSIDERATION OF RESOLUTION 2003-04, A PROPOSED *11111)
AMENDMENT TO THE TOWN OF FOUNTAIN HILLS GENERAL PLAN THAT WOULD
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 16 of 23 3/20/2003
CHANGE THE LAND USE MAP FROM THE DESIGNATIONS OF "LODGING" TO "MULTI-
FAMILY RESIDENTIAL HIGH DENSITY" ON A PORTION OF FINAL PLAT "FOUNTAIN
HILLS RESORT" LOT 1. CASE NUMBER GPA2002-01.
Councilman Kavanagh MOVED to approve Resolution No. 2003-04 as presented and Councilman
Archambault SECONDED the motion.
Councilman Kavanagh said that he was happy to see that there were not a large number of residents opposed
to the action taken by the Council this evening. He stated the opinion that no one lost and a successful
"compromise" was reached that would ultimately benefit everyone concerned.
Councilwoman Nicola indicated that she would support the motion and stated that she recognized that a
significant amount of effort had gone into reaching the compromises that had been discussed this evening.
She added that she couldn't help remembering that the Town of Paradise Valley did not have a primary
property tax or sales tax and they got by just fine on bed taxes. She emphasized the importance of
recognizing this fact and added that she also realized that without the rezoning and allowing the villas and
casitas to go in first, this project most likely would not come to fruition. She noted that an overwhelming
majority wanted this project to go forward and added that although she recognized that there were a number
of homeowners who would be affected by the decision made here this evening, she did have confidence in
the fact that developer would build a high quality project.
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM #10 - PUBLIC HEARING TO RECEIVE COMMENTS ON ORDINANCE 03-05,A
REZONING OF 9.91 +/- ACRES OF LAND LOCATED IN FINAL PLAT "FOUNTAIN HILLS
L. RESORT" LOT 1 FROM THE "L-3 PUD TO THE "R-4" ZONING DISTRICTS. CASE NUMBER
Z2002-11.
Mayor Beydler opened the public hearing at 8:31 p.m.
There being no citizens present wishing to speak on this agenda item, the Mayor declared the public hearing
closed at 8:32 p.m.
AGENDA ITEM #11 - CONSIDERATION OF ORDINANCE 03-05, A REZONING OF 9.91-ACRES
OF LAND LOCATED IN FINAL PLAT "FOUNTAIN HILLS RESORT" LOT 1 FROM THE "L-3
PUD" TO THE "R-4" ZONING DISTRICTS. CASE NUMBER Z2002-11.
Councilman Archambault MOVED to approve Ordinance 03-05 as presented and Councilman Melendez
SECONDED the motion.
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM #12 - PUBLIC HEARING TO RECEIVE COMMENTS ON ORDINANCE #03-04,
A PROPOSED REZONING FROM R1-8 (SINGLE FAMILY RESIDENTIAL) AND R-5 (MULTI -
FAMILY RESIDENTIAL) TO R-5 PUD FOR PROPERTY LOCATED AT 13225 NORTH EAGLE
RIDGE DRIVE. CASE NUMBER Z2003-02 AND PD2003-01.
Mayor Beydler opened the public hearing at 8:33 p.m.
Michael Downes, 16616 East Palisades
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 17 of 23 3/20/2003
Mr. Downes stated the opinion that no one objected to the expansion of the Copperwynd Resort because it
was both prestigious and good for the Town. He added, however, that he did not believe that approval of the
proposed PUD was in accordance with the Town's Zoning Ordinance, which was a municipal law and must
be upheld by the developer, the Planning Commission and the Council. He referred to Section 2.06 of the
ordinance and said that the last sentence in Paragraph A states "the Planned Unit Development provisions
allow the Town to establish a specific set of parameters for the development of land and supporting
infrastructure when certain criteria are met." He stated the opinion that the Council could not arbitrarily
approve a PUD for a parcel unless specific criteria were met.
Mr. Downes referred to the criteria listed in the ordinance and noted that after the Planning Commission
approved this development, he requested that the Town Attorney outline for him the criteria that the approval
was based upon. He said that the response he received advised that approval was based on Paragraph C3 that
essentially states that this conceptual plan would qualify the common open space where significant interior
amenities were provided. He stated the opinion that the project had not met the open space criteria necessary
for approval and therefore should not be approved by the Council.
Mr. McGuire responded to Mr. Downes'comments and stated that the language referred to by Mr. Downes is
part of the General Provisions for Planned Unit Developments. He pointed out that Planned Unit
Developments could be used for single-family as well. He added that in accordance with a strict review of
the Ordinance,the developer was well above the amount of space required.
Mr. Downes thanked Mr. McGuire for his opinion and the Council for allowing him to address them.
There being no additional citizens wishing to speak on this issue, Mayor Beydler declared the public hearing
closed at 8:39 p.m.
AGENDA ITEM #13 - CONSIDERATION OF ORDINANCE #03-04 A PROPOSED REZONING
FROM R1-8 (SINGLE FAMILY RESIDENTIAL) AND R-5 (MULTI-FAMILY RESIDENTIAL) TO
R-5 PUD FOR PROPERTY LOCATED AT 13225 NORTH EAGLE RIDGE DRIVE. CASE
NUMBER Z2003-02 AND PD2003-01.
Councilman Archambault MOVED to approve Ordinance 03-04 as presented and Councilwoman Nicola
SECONDED the motion.
Senior Planner Denise Ruhling outlined Staffs report relative to this agenda item. She referred to site plans
and highlighted a brief power point presentation. She explained that this case was spurred on as a result of a
recent annexation that took place in February consisting of just over 1.6 acres. She said that the parcel
needed to be rezoned from the R1-8 to R1-5 to accommodate current zoning on the site and in addition to
issue a Special Use Permit to allow the expansion of the resort because a Special Use Permit was currently in
effect. She noted that the Phase II proposal would include 104 rooms, an expansion of meeting room
facilities including kitchen and dining areas, a parking garage, the relocation of tennis courts and a water
attraction, including open space. She stated the opinion that the project was well designed and explained that
the Planned Unit Development was necessary because of specific design issues, including setback
requirements (30 feet in the front yard on Copperwynd Drive as well as the side yard on Eagle Ridge Drive).
She noted that the applicant had requested a 20-foot yard setback.
Ms. Ruhling stated that encroachment issues were minimal in content and Staff was not opposed to the
proposal. She added that another issue involved distance between buildings and said that following
extensive discussions with the Town's Chief Building Official regarding how the Uniform Building Code
viewed this buildings since they were a lodging facility rather than a typical residence, she had determined
that they could ensure that they wee safe in this area and no exceptions would need to be made other than the
vertical height of the building to allow them to come into conformance. She noted that both she and the lir
•
E:\BBender\Documents\Current Minutes 2003Utegular Session 3-6-03 agenda.doc Page 18 of 23 3/20/2003
Chief Building Official concurred with the recommendations contained in the Staff report and were
comfortable with this situation.
Ms. Ruffling noted that another issue involved the side yard setback to the interior and said that the applicant
was requesting a 5 foot setback on an existing building instead of the required minimum of 10 feet or one
and a half times the vertical height of the building, whichever was greater. She stated that the request is for
the interior, nothing could be seen from the exterior, and the project still met all of the requirements for
building separation between the buildings.
Ms. Ruffling stated that another issue in the Planned Unit Development involved an over-height issue and
said that Staff still did not believe that an over-height issue existed and explained that they were requiring a
maximum height of 40 feet for the entire side instead of the required 30 in an R-4 zoning district. She
explained that the Town Council had the authority to over-ride this and go up to 40 feet. She noted that there
was one area that might exceed that height and go up to 43 feet,the meeting facility.
In response to a question from Councilman Kavanagh, Ms. Ruhling reported that the Fire Marshall had
already reviewed the proposal and offered very limited comments relative to ensuring that access was
provided both in and out. She noted that this issue would be addressed during the design stage.
Councilwoman Stevens asked whether Staff had any concerns regarding the over-height for the retaining
walls and the site of line. Ms. Ruffling responded that she was working very carefully with the Engineering
Department and the applicant on those type of issues. She agreed that a couple of the issues were "a work in
progress" but stated the opinion that they were all attainable.
Mr. McGuire commented that when the Ordinance was drafted, Staff was still not certain whether the County
would have a review of the annexation/de-annexation. He added that since it was not on the agenda of a
scheduled meeting before the County Board of Supervisors as yet, it was recommended that a delayed
effective date be attached to the ordinance, until after the effective date of the de-annexation. He noted that
the motion should contain reference to a delayed effective date.
Councilwoman Nicola noted that the tennis courts were being raised significantly and would be used in the
evening as they currently are. She asked whether concerns existed regarding the lights and light pollution
resulting from the additional height of the courts. Ms. Ruhling discussed meetings she attended with a
number of the surrounding residents where this issue was raised. She stated that the height of the light poles
would be subject to the Town's ordinance requirements and the intrusion of the light would be subject to the
Town's Dark Sky requirements. She added that the lights were turned off at 10 o'clock at night and this
would continue to occur. She noted that the lights would not be turned on before 6 or 7 in the morning and
said that she was really comfortable that the lighting would not cause any disturbances. She advised that
Staff had not received a copy of the actual lighting plan as yet since lighting was a design phase issue but
indicated Staffs approval of the proposal at the conceptual stage.
Mr. Doug Signore,4434 Civic Center Plaza, Scottsdale
Mr. Signore addressed the Council and said he represented the applicant in this case and with him this
evening was Neil Ginsberg, the developer/partner with Sun Tech Development, the owners of Copperwynd
Phase I, and ultimately an integral part of the Phase II expansion. He added that Don Winetraub,the General
Manager of Copperwynd was also in attendance and willing to respond to operational resort type questions
from the Council.
Mr. Signore provided a brief overview of the project and, through the use of overheads displayed in the
meeting room, reviewed the scope of the site plan and renderings of the overall project. He briefly
commented on the outstanding issues that were previously raised by Ms. Ruhling and expressed the opinion
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 19 of 23 3/20/2003
that the proposal represents a balanced, quality project that was compatible with the surrounding area and
would positively impact the community.
Councilwoman Stevens commented on the negative impacts of the tennis court lighting and stated that
anything the applicant could do to improve upon this situation would be greatly appreciated, not only by the
residents in the area but by anyone driving down Palisades. She added the opinion that the lights should be
turned off prior to 10 p.m. at night and said that this might be necessary to accommodate evening players.
She reiterated that any effort expended to extinguish the lights as early as possible would be greatly
appreciated.
Town Manager Tim Pickering requested that Mr. Signore provide the Council with a figure representing the
amount of investment dollars that would be put into the expansion project. Mr. Signore reported that to date
it appeared that the approximate total project cost will be somewhere in the vicinity of$28 million.
Mayor Beydler stated the opinion that the project represented a wonderful addition to the community and
indicated his support for proceeding without delay.
The Mayor called for the question.
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM #14 - PUBLIC HEARING TO RECEIVE COMMENTS ON A REQUEST FOR A
SPECIAL USE PERMIT TO ALLOW A RESORT/COUNTRY CLUB IN AN R-5 ZONING
DISTRICT LOCATED AT 13225 NORTH EAGLE RIDGE DRIVE. CASE NUMBER SU2003-01.
Mayor Beydler declared the public hearing open at 9:05 p.m.
There being no citizens present wishing to speak on this agenda item, the Mayor declared the public hearing
closed at 9:06 p.m.
AGENDA ITEM #15 - CONSIDERATION OF A REQUEST FOR A SPECIAL USE PERMIT TO
ALLOW A RESORT/COUNTRY CLUB IN AN R-5 ZONING DISTRICT LOCATED AT 13225
NORTH EAGLE RIDGE DRIVE. CASE NUMBER SU2003-01.
Councilwoman Nicola MOVED to approve the request as presented and Councilman Kavanagh
SECONDED the motion.
The Mayor called for the question.
The motion CARRIED UNANIMOUSLY.
AGENDA ITEM #16 - COUNCIL ASSESSMENT AND REVIEW OF THE MEETING TO
IDENTIFY PROCEDURAL STRENGTHS AND WEAKNESSES AND DISCUSS POSSIBLE
IMPROVEMENTS FOR FUTURE MEETINGS.
Councilwoman Nicola said that she had not yet had the opportunity to read yesterday's Fountain Hills Times
and questioned whether this meeting format, as posted in the paper containing set times, was a good idea.
She noted difficulties associated with maintaining a set time schedule in view of the various issues that were
heard. She recommended that rather than err on the longer side and winding up an hour and a half short, such 111.
as they had done tonight, they should err on the other side.
E:\BBender\Documents\Current Minutes 2003'Regular Session 3-6-03 agenda.doc Page 20 of 23 3/20/2003
Councilman Kavanagh stated the opinion that the goal of ending meetings by 10-10:30 p.m. was a good one
Lir but he believed that this was exactly what should be stated, that the Council "would attempt to end them at
this time" rather than place actual times on the various agenda items.
Discussion ensued relative to exerting effort to limit the meetings to 10-10:30 p.m. but not posting specific
agenda discussion times.
Mayor Beydler commented that the Mayor of Gilbert advised him that although initial attempts to stick to a
set agenda discussion timeframe were difficult, improvements were made over time and the meetings were
eventually conducted in a timelier manner and remained pretty close to the estimated time frames.
It was the overall consensus of the Council that agenda discussion times not be advertised in the paper as part
of the meeting agenda, until the process had shown some improvement or other arrangements were decided
upon.
Mr. Pickering commended the Mayor on his excellent performance this evening and stated that the meeting
was conducted in a very efficient,productive manner.
Councilman Melendez suggested that during Easter Week, the date of the Regular Council meeting be
changed from Thursday,April 17th to Tuesday,April 15th in order to accommodate travel over the holiday.
Mr. McGuire suggested that a Special Meeting be held in place of the Council's Work Study Session on
April 8th in order to accommodate this request.
Following additional discussion among the members of the Council, it was decided that the Thursday, April
tkliv 17, 2003, Regular Meeting be cancelled and that issues be discussed at the April 8th Work Study Session.
Should pressing issues arise that required action, the Council decided that the Work Study Session would be
changed to a Special Council Meeting or a combination of both.
Councilwoman Nicola indicated that she would not have been able to attend the Thursday, April 17th
meeting.
AGENDA ITEM#17- CALL TO THE PUBLIC:
Councilwoman Stevens noted that under this agenda item, the Council might give direction to Staff. She
asked for input from the other members of the Council relative to directing Staff to ensure that the Public
Relations firm that had been hired to "educate" the citizens of Fountain Hills on the upcoming property tax
issue be made aware of the fact that a number of citizens are unhappy with the fact that the firm had in fact
been hired for this purpose. She stated the opinion that a significant amount of the unease may have to do
with the use of the word "educate" and questioned whether a better, more appropriate term should have been
used to describe that the firm's purpose is to provide the public with accurate, up to date, user-friendly
information relative to this important issue that will impact the entire community.
Councilwoman Stevens added that use of the word "educate" may have resulted in the opinion on the part of
many citizens that the Council views the public as being "uneducated" and emphasized that this was untrue
and not at all the point that they were trying to make. She reiterated the importance of making sure that the
word goes out to citizens that the goal of the firm was to provide the public with accurate, current and
thorough information for their consideration prior to voting on this matter. She added that perhaps the Public
Relation firm's first job should be to take control of this situation and noted that the absolute last thing the
Council wanted to do was insult the members of the public.
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 21 of 23 3/20/2003
Mr. Pickering indicated his intention to contact the firm and direct them to take on this challenge without
delay.
Mayor Beydler commented on the fact that he had discussions with the Town Manager several days ago
relative to the consulting firm URS and the survey of the Town's boundaries that they conducted over a year
and a half ago. He said he recently learned that Staff was having problems producing the invoice and the
necessary documentation to provide the Citizens to Save Our Community with the necessary information
required by the County in order for the group to move forward with the public hearing on the impact
statement. He asked Mr. Pickering to provide him with an update on the status of this information.
Mr. Pickering advised that the correct information has been located and added that it had not yet been
transmitted to Mr. Henry but the requested documents as well as the name of a contact person had been
located.
The Mayor said that he wanted to make a public statement to the effect that he had talked with Don Stapley,
the Chairman of the Maricopa County Board of Supervisors, and he had the Chairman's full support in
assisting the Town in their efforts to work with the County and ensure that the public meeting was scheduled
and held as soon as possible. He added that he would meet with Chairman Stapley sometime next week to
begin developing a working relationship on that level.
Councilwoman Nicola said that she wondered whether for future annexations the Town would be able to
include as part of that the re-figuring of the boundary and request that the party pursuing the annexation be
required to submit that information so that a complete legal boundary meets and bounds map would remain
in place. She asked whether this was possible to achieve.
Mr. McGuire responded that this information was provided by the applicants but what was not provided was
the remainder of the borderlines all around the Town of Fountain Hills. He explained that the applicants
provided an accurate description of what they were bringing into the Town. He added the opinion that this
might be an area that required use of the Town's resources in order to ensure that accuracy had been
achieved.
Councilwoman Nicola also acknowledged the wonderful job that Staff has been doing in view of their
limited resources and said that she had heard a lot of positive comments and compliments coming from
citizens as a result of Staffs performance and overall positive customer service attitude.
Councilman Archambault commented on the fact that they had not heard anything from the Citizens to Save
Our Community (CSOC)but added that although the group was tentatively scheduled to speak to the Council
at the next meeting, he had received word that they might not even be ready by that time to address the
Council. He noted that the group would let the Council know when they were in a position to provide an
update.
AGENDA ITEM#18- ADJOURNMENT
Councilwoman Stevens MOVED that the Council adjourn and Councilman Archambault SECONDED the
motion, which CARRIED UNANIMOUSLY. The meeting adjourned at 9:20 p.m.
TOWN OF FOUNTAIN HILLS
•
B ' • I
on Beydler, Ma,o
E:\BBender\Documents\Current Minutes 2003\Regular Session -6-03 agenda.doc 'age 22 of 23 3/20/2003
L
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 Regular Session
held by the Town Council of Fountain Hills on the 6th day of March 2003. I further certify that the meeting
was duly called and that a quorum was present.
DATED this 20 day of March 2003.
Bevelyn J.Bender, own Clerk
L
L
E:\BBender\Documents\Current Minutes 2003\Regular Session 3-6-03 agenda.doc Page 23 of 23 3/20/2003
J