HomeMy WebLinkAbout2012.0430.TCWSM.Mintuesz:\council packets\2012\r6-7-12\120430m.docx Page 1 of 13
TOWN OF FOUNTAIN HILLS
MINUTES OF THE WORK STUDY SESSION OF THE
FOUNTAIN HILLS TOWN COUNCIL
APRIL 30, 2012
AGENDA ITEM #1 – CALL TO ORDER AND ROLL CALL
Mayor Schlum called the meeting to order at 6:01 p.m. in the Town Hall Council Chambers.
Present for roll call were the following members of the Fountain Hills Town Council: Mayor Schlum,
Vice Mayor Dickey, Councilmember Contino, Councilmember Leger, Councilmember Brown and
Councilmember Hansen. Town Manager Ken Buchanan, Town Attorney David Pennartz, Deputy Town
Manager/Finance Director Julie Ghetti and Town Clerk Bev Bender were also present.
Councilmember Elkie was absent from the meeting.
AGENDA ITEM #2 – DISCUSSION RELATING TO THE PRELIMINARY TOWN OF
FOUNTAIN HILLS BUDGET FOR THE FISCAL YEAR BEGINNING JULY 1, 2012,
INCLUDING ALL PROPOSED REVENUES, EXPENDITURES AND NEW PROGRAMS FOR
ALL GOVERNMENTAL FUNDS.
Town Manager Ken Buchanan addressed the Council relative to this agenda item and stated that staff has
set up three meetings for the Council's benefit as to whether they wanted to divide up each area and talk
about them in three different meetings or go ahead and try to work it through. He said they can try to do
that tonight and see how much they accomplish and then determine whether the next two meetings will be
required. He noted that they will still be holding the Open Houses on Tuesday and Wednesday and staff
will be present at those meetings to answer any questions that the public might have. He reported that
they start at 5:00 p.m.
Mayor Schlum suggested that the Council try to get through as much of the budget discussion as possible
and it will give the public an opportunity to hear all of that discussion and they can then provide some
input during the Budget Open Houses.
Deputy Town Manager/Finance Director Julie Ghetti addressed the Council relative to this agenda item
and highlighted the contents of a brief presentation on proposed budget highlights for Fiscal Year 2012-13
(a complete copy is available on line and in the office of the Town Clerk).
Ms. Ghetti noted that the proposed numbers were presented to the Council on a number of occasions so
this is an opportunity to briefly go through each department and discuss the highlights. She added that
then there will be time for the Council to ask questions and receive staff responses and clarifications.
Ms. Ghetti informed the Council that there have been some changes made over the last week and a half to
two weeks that she wanted to bring to the Council's attention because they directly affect next year's
budget. She noted that one of the first things is the Cottonwoods Maintenance District, which the Council
serves as the Board on, and said it is a separate fund and not the Town's General Fund (funded by the
taxpayers in that district). She said that the district has approached the Town about doing some
maintenance items to their common areas, specifically the wall -- they would like to have the wall painted
and there are some landscaping issues so they need to allocate the budget authority in that budget to allow
staff to do that. She further stated that the Street Department acts as the HOA for that development so
they will be doing the work or contracting out the work so they needed to add $15,000 to that fund to
accommodate those expenditures.
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Ms. Ghetti advised that the next item does affect the General Fund and is related to the issue that the
Town currently has with Sanitary District relative to running out of effluent water during the summer
months. She stated that there is a strong possibility that they will have to water the parks with potable
water, which will cost more than effluent (currently the Town does not pay anything for the effluent
water). She said that in the event that that does happen and they have to use potable water, staff wanted to
make sure that they put some money in the budget to account for that. She reported that this would affect
the General Fund by approximately $100,000. She stated that in the first draft of the budget they had a
$250,000 contingency that was not programmed and they are just going to add this to that contingency for
a total of $350,000 and it will be used if they have to pay for water in the parks (a transfer would be made
to increase the Parks budget).
Ms. Ghetti discussed Cutillo Plaza and noted that Councilmember Hansen is working on this. She
advised that this was going to originally be spent this current fiscal year but they are going to carry it over
into next year and have the expenditures occur after July 1st. She noted that this represents $10,000 in the
General Fund.
Ms. Ghetti further stated that the fourth item is the Transit Funds, something they have talked a little bit
about before. She said that this is in the Special Revenue Fund and represents grant funds that are
available to the Town that can only be used for transit. She noted that the Town received notification
from Valley Metro this week that the Town's portion is $66,000 and there is no matching requirement (the
Town does not have to contribute 25%). She said that to apply for the grant the paperwork and everything
must be done by May 31st so they as a community have to decide what they want to do with those funds -
- the projects must be identified. She added that this does not affect the General Fund. She referred to a
chart that reflected the updated five-year projection which takes into account all of the changes that she
just outlined.
Ms. Ghetti addressed the LTAF II Grant and stated that this is the transit grant that she was talking about
with the $66,000 allocation. She reiterated the fact that the monies must be used for transit purposes,
there is no General Fund match required and the deadline to file for funds is May 31, 2012. She reported
that there are three potential programs that the funds could be used for:
* Flex-stop circulator (transit that would go around Town, a fixed route with specific stops and would
connect with the bus over at the Mayo Clinic that can go anywhere around the Valley).
* Dial-A-Ride service. Ms. Ghetti noted that they can structure any of these programs anyway they
want so they can restrict it to so many trips, restrict it to specific categories or people who are going to
use it (i.e. just to be used by seniors, disabled or low-income individuals). When the $66,000 is gone,
that is the end of the program.
* Leave funds with Valley Metro. The Town could decide not to apply for the grant and just leave it
with Valley Metro and they will allocate the money and use it and/or give it to another city.
Vice Mayor Ghetti commented that those three items listed above are potential programs but they are not
exclusive; there are other things that the Town could do. She added that they will be having some
discussion on this.
Ms. Ghetti advised that there were four options, two of which would be administrativel y impossible for
the Town to do. She said that the first was a taxi/coupon type of program and noted that the Town does
not have the staff to carry out the administrative work that would be associated with that. She added that
another was a mileage reimbursement program where the Town would actually reimburse people for
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taking other people places they need to go. She stated that again, this is not something that Town staff
can administratively accomplish. She said those were the four options the Town received from Valley
Metro and if there are others she is not aware of them.
Mayor Schlum referred to the Valley Metro part and said that since they are in the Valley and part of the
Maricopa Association of Governments (MAG), he would like to know as far as the dollars that would go
to Valley Metro whether there is more that they can do than the $66,000 that the Town would put into the
program should they choose that option. He pointed out that they have had plans to expand for years and
they keep pushing that back. He added that it would be nice to have an actual connection with the transit
system out here rather than having to drive to the Mayo Clinic.
Ms. Ghetti replied that they have pushed it back and her understanding is that it is not going to be moved
back up anytime soon (she thinks 2020 is the nearest date they would extend that bus service out to
Fountain Hills). She said that is what she thinks they were trying to accomplish with the Flex -stop
circulator because if the Town decides that it wants to pay for that bus to come out here they then have to
provide a para-transit program (a Federal requirement) to accompany it and they cannot afford to do both.
She added that the Flex-stop circulator kind of provides the same service -- it would service local
Fountain Hills residents, connect them to the bus at the Mayo Clinic and then they would go on from
there. She said that they could then assign a fare to the program -- it would be their choice as to whether
they wanted people to pay, and if they had people pay $2.00 or another nominal amount, the program
would last longer. She stated that hopefully they could manage it so it would last an entire year but there
is no General Fund matching requirement with this grant.
Councilmember Hansen commented that she knows in the past there were some other uses other than
transportation that the Council could approve by resolution (education, historical, etc.) and asked if those
were the LTAF II funds. She also asked if that is still an option or has it changed.
Ms. Ghetti responded that she believes what Councilmember Hansen is referring to are the LTAF I funds,
which allows them to give away 10% to education and cultural areas. She reported that the Town no
longer has LTAF I monies anymore and LTAF II funds can only be used for transit.
Councilmember Leger asked if there are any other strings attached to the Flex-stop circulator program,
such as providing additional infrastructure for increased stops, etc. and Ms. Ghetti replied such as bus
stops -- and she is not sure of that and would have to check into it further. She advised that the $66,000 is
for this year that they are in now and they are going to get the money in June but they can carry it forward
to the next year and use it. She added that they will receive the funding next year as well (2012-13) but
she is not sure what will happen beyond that.
Councilmember Leger stated that when they talk about "running out of money" that gives him concern
because it is really a toss of the dice -- creating an expectation and then taking it away. He noted that they
have been there before with transportation and people depended on it for several months and then all of a
sudden the money was gone and they were looking for alternatives. He asked whether much thought had
been given to that.
Ms. Ghetti advised "absolutely" because the last thing they want to do is set up a service for citizens that
they come to depend on and then have to take it away. She said that if a decision is made to move
forward with this type of program then the Town would have to set the parameters and there can't be just
two people who are using it all for the rest of the community. She added that they could do that -- they
could set a fare if they want to charge people $2.00 and make the program last longer.
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Councilmember Leger commented that he is certainly not a transit expert but he just wondered how much
"bang for the buck" they would get out of the $66,000 and he is sure there are some experts out there who
could tell them what the parameters could be. He stated that if they start up a program like that and
money runs out there may be requests from the residents to supplement the program and keep it going and
as he mentioned they have been down that road before and it is a very difficult one.
Councilmember Brown advised that they are talking about $66,000 and when that money runs out, does
the Town pay per bus stop, per mile, per person -- he asked how this would be expensed.
Ms. Ghetti responded that the Town actually wouldn't pay for anything -- it would give the money to
Valley Metro to run the program but we would tell them "this service is only for medical trips" or "this
service is only for seniors and medical trips" or "charge everyone a $2.00 fare for this service."
Councilmember Brown questioned how they would know where the money is being spent and Ms. Ghetti
said that obviously staff would have to do a lot more research before they could bring this back. She
noted that the challenge they face is that they ha ve to apply for the monies by May 31st or forfeit them.
She added that it doesn't mean that they have to start the program -- there are a lot of questions that would
have to be answered.
Councilmember Contino asked Ms. Ghetti whether there was any way sh e could get a hold of the transit
people and find out what the $66,000 would take care of and how long it would last so they would know
whether they have to charge people. He stated the opinion that he doesn't think a $2.00 fare would be bad
if people could use it to go where they need to and do what needs to be done. He added that he is sure
that a lot of people would go from here and connect to the 106 to get to the hospital so this could save
them a lot and do the Town a great service if they could find out from Valley Metro just what it is going
to entail, what it is going to cost and how far the money will go and what do they have to do to maintain it
and keep it going.
Ms. Ghetti concurred with Councilmember Contino's statements and agreed that there is a lot that they
would need to find out about.
Councilmember Contino stated that if they do it so that there are all of these different stops then they will
probably have an increased ridership and that is what they need to find out from Valley Metro even before
the end of May application deadline.
Ms. Ghetti said that staff could do that.
Vice Mayor Dickey advised that obviously there are options and Ms. Ghetti will have the opportunity to
obtain information and address the items that Councilmember Contino talked about. She pointed out that
the money was swept and then it was determined that that was not a legal thing to do because the money
is attached to the State's implementation plan for air quality so they had to give the money back and that is
why they have the money this year. She said that the funding will continue and she doesn't think that they
will find themselves in that same "one day here, one day gone" situation. She added that once there is
time staff can look into various options and find out what other municipalities are doing. She indicated
that she would not oppose charging residents a minimal fare, which would help the program. She stated
that it will be set up with expectations and hopefully they will be doing the right thing for the community
and it will be something that is used and can continue.
Mr. Buchanan pointed out that once the lawsuit was settled the Town was not given a lot of time to
consider what they wanted to do with the money. He said he does believe that they should budget for it
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and then try to figure out what they can do with it this month so they can have it on the next agenda as
well. He further stated that he, Ms. Ghetti and staff will come back with information as to other options
after discussions with Valley Metro. He stated that they have to determine whether those are just going to
be "flag stops" on a fixed route that will go over to #106 and the Mayo Clinic (not a bus stop, just a flag).
He said that there will be a fixed route and they will stop at however many stops are decided. He
reiterated that staff will bring back more information on this for the Council's consideration.
Ms. Ghetti referred to an updated chart that showed the two departments that had budget changes --
Administration and Development Services. She noted that the Administration budget takes into account
the additional $100,000 in contingency and Development Services includes Cutillo Plaza.
Vice Mayor Dickey asked if Cutillo Plaza is a capital item and Ms. Ghetti replied n o, and explained that
there are several pieces associated with it -- signage, a monument and a reception as well. She added that
this will be in the fall.
Ms. Ghetti informed the Council that the Administration budget went up 10% and briefly highlighted the
associated programs listed on the PowerPoint presentation as follows:
* Tourism - branding and marketing
* Support for Boys & Girls Club, Theater and Food Bank
* Restore computer and server replacement program
* Statistically Valid Citizen Survey
* Integrated marketing strategy
* Includes $350,000 contingency as safety net
Vice Mayor Dickey asked if the Statistically Valid Citizen Survey was being driven by the Strategic
Planning Advisory Commission (SPAC) and Ms. Ghetti confirmed that it was.
The Vice Mayor questioned whether the SPAC has had any conversations with Ms. Bordow about some
of the things that she has been working on.
Ms. Ghetti advised that she has actually been talking with Ms. Bordow because she believes they are on
two different tracks -- one is the statistically valid survey and the other being the random calling of
citizens. She stated that they are trying to bring them together and reported that the SPAC has only gotten
an estimate on a price but has not communicated with anyone. She noted that this would all have to come
back to the Council for a contract so this is just a place holder -- a plan to do it -- and that is as far as they
have gone with it but it is being driven by the SPAC. She added that Ms. Bordow is way ahead o f the
game because the budget has not been adopted and she is out there doing all this background work, which
is great. She said that once the budget is adopted and they know what they are moving forward with, then
they will get together. She explained that she has been talking with Ms. Bordow and explaining the
difference between a statistically valid survey and what she was thinking to bring them together.
In response to a question from the Mayor relative to the timeline on the Boys & Girls Club, Theat er and
Food Bank, Ms. Ghetti advised that there were presentations by the groups last week and the Budget
Committee is going to meet again this week and go over those presentations before coming back before
the Council with recommendations relative to scope of work (what they are proposing) and how they
align with the Council's goals.
Mayor Schlum requested information on the Integrated Marketing Strategy item and Mr. Buchanan
advised that hopefully this will cover the entire strategy and explained that they still have a process to go
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through. He said that they need to bring back a committee, hopefully comprised of the Council and other
entities that can sit down and discuss a comprehensive approach to some economic development
programs. He stated that obviously tourism and destination programs and then some economic
development related specific strategies they need to work on as well.
The Mayor commented that with Mr. Buchanan coming on board, this will give them an opportunity to
take a fresh look at things and see where they are at and what they want to do moving forward.
In response to a question relative to the 10% increase in the overall budge t, Ms. Ghetti confirmed that all
of that is the contingency. The Mayor noted that $100,000 of that is for water and asked why they would
not put that into the Park's budget. Ms. Ghetti replied that they put it into the contingency program
because they are not sure that that is going to have to happen. She said that if it turns out that the Town is
going to have to use potable water, that is going to affect the Parks' budgets and they will have to do
budget transfers and those will all come before the Council. She confirmed that any time money is taken
out of the contingency fund for another use that action must come before the Council.
Councilmember Contino asked if any parks are currently utilizing potable water and Mr. Mayer advised
that there are two -- Four Peaks (completely on potable water) and Golden Eagle (capability for both
potable and regular water).
In response to a question from Councilmember Hansen, Ms. Ghetti confirmed that the Town does not pay
for effluent water now. She added that the $100,000 was what was left over in the General Fund (staff
has not analyzed how many gallons are used).
Mr. Buchanan informed the Council that staff officially received notification relative to the shortage last
week and Mr. Mayer has been asked to come up with some numbers so that they can get a better handle
on that.
Mr. Mayer advised that staff is working with the Sanitary District to get those numbers and noted that
they can't just look at the whole year's numbers because the shortage will most likely only occur during
the summer months and by fall the shortage will end. He stated that staff has to figure out what the usage
is at each park each month.
Ms. Ghetti noted that the Development Services budget increased 29% and also highlighted the various
programs/projects associated with that increase as follows:
* Increased maintenance of Town washes
* Restore maintenance of Town-owned facilities
* Conduct a household hazardous waste event
* Updated aerials of Town
* Code compliance abatement
In response to a question from Councilmember Contino relative to conducting a hazardous waste event,
Ms. Ghetti advised that the Town is required to go out for bids for anything over $20,000. She stated that
this will come back before the Council and staff just put in an estimated cost.
Mayor Schlum commented that he is sure there is a good reason why staff is proposing that the aerials be
updated and Ms. Ghetti said that Mr. Mood is not present this evening but she will find out the reasons
behind this proposal and forward it on to the Council tomorrow.
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Ms. Ghetti confirmed that the 29% increase represents mainly the major maintenance items for buildings.
Ms. Ghetti continued with her presentation and discussed Community Services -- parks, recreation, the
Community Center, Seniors, several events including new ones, new toddler programs, more support for
the Home Delivered Meals program, partnering with the Chamber and the Fort McDowell Yavapai
Nation on the National Trails Symposium, the restoration of park maintenance and resurfacing of tennis
court parking lots and repairs to the Fountain (an increase of 3% in this budget).
Councilmember Hansen commented that when they had their joint meeting with MMPC (McDowell
Mountain Preservation Commission) last week they had a presentation on the Trails Symposium for next
year and the Tourism Bureau said that they were going to be a sponsor to the tune of $10,000. She asked
if this is what the partnering is for -- making it a co-sponsorship rather than just the Tourism Bureau. She
added that there is a meeting of the host committee on Monday so perhaps they can obtain clarification at
that time.
Mayor Schlum asked what the additional support for the Home Delivered Meals Program consisted of and
Ms. Ghetti advised that this is to pay for the fingerprinting that now is required for all volunteers
(approximately $60.00 per person).
In response to a request for information relative to the expansion of the Hashknife Pony Express event,
Mr. Hughes explained that over the past couple of years discussion has occurred relative to expanding the
program and $5,000 has been budgeted to perhaps do something at the new Centennial Circle and to do
enhance promotion for this event.
Mayor Schlum commented that it would be great to engage the School District in this and have the school
children out there.
Mr. Hughes agreed and stated that they are trying to make this a community event. He confirmed that the
Town is still scheduled to be a stop for the Ballet Under the Stars ev ent (the first performance of the year
on a Thursday in September). He noted that they are looking for an increase but this year they are
sticking with the $6,500 that was budgeted for this. He added that this is a pretty expensive event and the
Town has been fortunate in that there have not been increases over the past five or six years. He stated
that other communities contributed more than the Town and so the event will be held on a Thursday
instead of on a weekend so they will see how that works out.
Councilmember Leger referred to the International Trails Symposium and said that this has not been
finalized but they had an opportunity to listen to a draft presentation by the Tourism Bureau. He stated
that this is part of their proposed budget with respect to the contract that the Town would be engaging in
with them subject to change based on the amount of money that is in there -- he said he believes this is
part of the partnership at this point.
Ms. Ghetti discussed Fire & Emergency Medical which is showing a 3% increase in the budget
(automatic 3% every year as part of the Valley Metro contract). She advised that the increases are to
cover enhanced support for the CARE Program, new extrication equipment, an IGA with Maricopa
County for an Emergency Operations Plan and replacing a fire hose nozzle.
Ms. Ghetti provided a brief overview of the Law Enforcement budget that shows a 5% increase to cover
support for the Maricopa County Sheriff's Office (MCSO) Posse (approximately $15,000 that is just a
placeholder at this time since they have not finalized what the program would look like), the contract that
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provides for a School Resource Officer at the Middle and High School, an IGA with Maricopa County for
animal control and shelter and jail fees.
In response to a question from Vice Mayor Dickey, Ms. Ghetti stated that the support for the MCSO
Posse is a new program and therefore staff wants to make sure that the Council is on board with it before
they move forward.
Councilmember Contino noted that this is the second budget meeting they have held and La w
Enforcement has not been present. He asked if there was any way to get them to attend the meeting, go
over the various items and provide explanations particularly regarding the Posse.
Ms. Ghetti replied that she believes a presentation was given at one of the budget meetings but staff can
certainly ensure their presence at the next meeting.
Ms. Ghetti moved on to the Streets Fund (HURF) budget, which reflects an 11% increase and explained
that this is a separate fund and not included in the General Fund. She noted that they are anticipating an
increase in HURF revenue from the State based on preliminary estimates from the League. She said that
staff put in a $100,000 contingency line item just in the event that HURF revenues do not come in as
anticipated. She added that the monies will cover maintenance of traffic signals, street sweeping, curbs,
sidewalks and potholes; repair of street signs; storm drain inspections/cleaning; coordinating traffic
control for special events; median maintenance and the Adopt a Street program.
In response to a question from the Mayor, Streets Superintendent Ken Kurth advised that staff will
continue to use the temporary patch for the potholes and other repairs until the Town receives more
money. He stated that they do this on a frequent basis and it is a good product but costs $12.00 a bag and
staff is out there every week. He added that they will do some small patching. He said that the other
option, which would be more permanent, would be to replace the asphalt and confirmed that that would
be more of a capital project than a maintenance project. He advised that he is conduct ing a Town-wide
assessment of areas that are failing and completed Zone 1, the northeast section, and they are up to about
$350,000 for patching. He noted that the asphalt base is failing and in order to resurface they would have
to take that out first. He said that the $100,000 is in the budget to take care of small stuff and the Mayor
commented that that represents a big gap in the Streets budget.
Councilmember Hansen referred to Traffic Signal Maintenance and said that two years ago she believes
she brought up trying to make the signals coordinate better and was told that it would require a Traffic
Engineer to accomplish that task. She stated that she doesn't know how much it would cost but she would
at least like to have a discussion on changing the way the Town's signals operate. She pointed out that in
Scottsdale a lot of intersections are using flashing yellow arrows, which allows more f lexibility when
approaching an intersection and people don't have to sit at a red arrow when there is no approaching
traffic. She indicated her interest in pursuing this and determining what the associated costs would be.
Mr. Kurth stated that that would require an engineering study and currently they have $20,000 in their
budget under Professional Fees for engineering. He advised that anytime they change anything related to
a signal they can physically do it but they cannot do it without an engineering study, which allows them to
do that.
Councilmember Hansen asked if they would put a stamp on the plan so that the Town is protected and
Mr. Kurth replied yes and said it is all about reducing the Town's risk.
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Mr. Buchanan informed the Council that it is a liability issue and there is a test that goes along with that
and if a municipality wants to go with a flashing yellow light or some other change, that requires a study
that says what can be done. He added that they could take the risk and go ahead and do the work but
assured the Council that it is more of a liability issue than it is an engineering issue. He stated that staff
could certainly look into Councilmember Hansen's suggestion (flashing yellow and even flashing red).
Councilmember Hansen commented on the additional pollution that results from cars standing at lights
even when there is no oncoming traffic and added that there is merit to finding at if they could do it better
and the Mayor concurred. The Mayor added that it would be good to determine what would require a
stamp and what wouldn't and to get the work done as quickly and inexpensively as possible because there
is too much waiting, especially at night.
Mr. Kurth explained that what they would be doing is changing from a protected left to a permissive
protective left and Mr. Buchanan stressed that those terms have significant meanings attached to them,
particularly when a court case is involved.
In response to a request from the Mayor, Town Attorney David Pennartz stated that he has had a lot of
experience in this area and whenever people get into a car wreck on a city or town road, they always
claim that the city or town is at fault because the perception is that municipalities have more money than
individuals’ insurance coverage. He added that it is a matter of traffic engineering procedures being
correctly done, traffic engineering standards being met and there is always some degree of traffic
engineering judgment that goes along with that. He noted that when you do all the things he just
mentioned, there is a lot of liability protection.
Councilmember Contino asked if the study would encompass $20,000 for one signal or cover multiple
signals.
Mr. Kurth responded that the $20,000 is just a figure and, as an example, said that to do a change on a
signal's timing the traffic study on that costs approximately $5,000 to accomplish that change. He further
stated that to change from a protected left to a permissive protective left would probably cost double that
amount. He said that the engineer will put a stamp on it and give the Town the authority to make the
change. He also said that they would have to do a study on the mast arms to see if they can hold larger
heads because they were designed for the heads that are currently in place.
Councilmember Contino commented on the length of time he has sat at intersections waiting for the light
to change when there was no oncoming traffic and Councilmember Hansen emphasized the importance of
wanting people to come to Town and not avoiding coming to Town because of the long lights.
Ms. Ghetti continued her presentation and discussed the Capital Projects Fund, which has about $9
million in cash in it right now. She advised that they accumulate these funds from construction, which is
a one-time revenue. She noted that 50% of the construction sales tax that the Town collects goes into this
fund. She reported that for 2013, staff is estimating that they will spend about $4.3 million out of that
fund and a lot of that is for streets and the median in the downtown area. She emphasized that that doesn't
mean they would spend that money -- all of the proposed projects would come back before the Council
for discussion and direction. She stated that the fund all together amounts to $11.2 million but that is not
all their money, some of it is grants and the excise tax fund ($6 million in grants and if they don't get
those grants they won't be doing those projects). She reiterated that this is just a budgeted amount and
referred to a chart that depicted the types of projects. She indicated her willingness to respond to any
questions relative to this item.
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Mayor Schlum said that this is getting away from their $2 to $2.5 million a year expenditure and
questioned why they would be motivated to do that when the Capital Fund is not being replenished yet.
Ms. Ghetti stated that Mr. Mood, who is not present this evening, believes that to move forward on a big
project that he has in there would take advantage of the economies of scale that exist right now. She added
that instead of breaking things up into smaller pieces he is proposing that they just do it all at one time (a
street improvement) and do it in one year rather than two.
Mayor Schlum commented that it is good that they have money in the Capi tal Projects Fund and he
doesn't know whether other cities and towns have been able to maintain their fund balances in their
Capital Fund. He stated, however, that without the money being reimbursed in the near future it makes
him nervous to go over that $2 million a year or so.
Vice Mayor Dickey asked if any of the projects that are listed under the Capital Expenditure Fund are
expenditures dependent upon obtaining a grant and Ms. Ghetti replied that under Streets/Sidewalk
Improvements, the $1.7 million is probably part of their matching funds for some of the grants.
The Vice Mayor stated that the worst case scenario then would be the $4.4 million out of the Capital
Projects Fund and Ms. Ghetti said except for the ones with the grants.
Mayor Schlum noted that they have $11.6 million in spending potentially out of the Capital Fund but $4.4
of that represents Town dollars and Ms. Ghetti concurred. The Mayor added that $7 million plus would
come from somewhere else and again Ms. Ghetti agreed with the Mayor's statement and stated there is $6
million from grants and then there is $1.2 million out of the Downtown Excise Tax fund and that is for the
median project on Avenue of the Fountains.
Mayor Schlum pointed out that the Fire and EMS project is in t here as well and asked if they knew of
another grant coming up that they might be going after and Ms. Ghetti advised that she was not aware of
any.
Councilmember Hansen referred to Traffic Signals and asked if that was for a new signal, the $453,000,
and Ms. Ghetti replied no and explained that that is just in there as a place holder in the event that they
have to replace the signal at Saguaro and Palisades. She noted that that is one of the original County
signals and very old. She said that the money is just in there in case that pole has to be replaced.
Councilmember Hansen also referred to Vehicle Replacement at $400,000 and said she knows that Ms.
Ghetti had advised that they were going back to the replacement plan. She added, however, that similar to
when they talked about the Council's computers she is a little uncomfortable saying "okay, it's been here
for so many years and it's old technology so it needs to be replaced" and would prefer considering these
items on a case-by-case basis. She indicated concern relative to automatic replacements rather than
replacing those items that actually need to be replaced.
Ms. Ghetti asked whether Councilmember Hansen was talking about vehicles or equipment and
Councilmember Hansen responded that she was talking about the program itself. She questioned how old
the vehicles are and their mileage and asked if there are vehicles that could still be utilized but are being
replaced because they are on the replacement schedule.
Mayor Schlum referred to the $400,000 and asked if that is "funding the fund" -- funding the Vehicle
Replacement Fund or are they expecting to spend that amount on new vehicles.
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Ms. Ghetti advised that the $400,000 is to spend money to replace vehicles. She added that staff is
currently reviewing the entire Vehicle Replacement Policy anyway because it is a philosophical question -
- whether it is ten years and 100,000 miles or a vehicle that is ten years old that only has 40,000 miles on
it -- some people think the latter vehicle should be kept because of its low mileage and the other side is to
auction it off while it still has some value and put the money back into the Vehicle Replacement Fund.
She added that they have not been replacing the vehicles and there is a policy that states "ten years,
100,000 miles." She noted that in Fountain Hills they don't put that many miles on vehicles every year
and they could have a vehicle that is 15 years old and still under the 100,000 miles but repairs and
maintenance become very expensive. She stated that the plan would be to take a vehicle like that to
auction and get the most they can for it. She said that they are going through this whole process right n ow
(reviewing the policy) and there is a large fire truck that has to be replaced (not this year but the year
after) and that will be a $500,000 hit to the budget. She further stated that the idea is if they put the
money aside then when they need to replace a vehicle or fire equipment the money will be there.
Mayor Schlum said that it sounds like the idea is to put money aside to cover costs when and if they need
new vehicles/fire equipment -- not necessarily spend it that year, but bank it so to speak so that when the
need arises there will be money available and Ms. Ghetti concurred with the Mayor's summation. She
explained that the funds are actually set aside and taken out of the General Fund or the HURF Fund and
put into an internal fund, the Vehicle Replacement Fund. When vehicles are purchased they get charged
to the Internal Service Fund and the money stays in that fund at the end of the year.
The Mayor commented that he thinks that is a good plan -- put some money away every year and not
spend it all so that money is available when they need it. He added, however, that he agrees with
Councilmember Hansen and stressed the importance of making sure that they make decisions based on a
vehicle-by-vehicle basis. He said that they are not saying that they are going to spend the $400,000
whether they need to or not and Ms. Ghetti concurred. She stated that they need some kind of policy in
place to do it because if they wait until all the vehicles are failing they could wind up having ten
(exaggerated number) failing in one year and then the budget would have to increase significantly. The
idea is to keep them all in good working order and not place a burden on the part-time staff who maintains
them.
Mayor Schlum said that they should have ample time to determine how much life a vehicle has left (a
couple of years in advance) and Ms. Ghetti reiterated that they have adopted a policy but that doesn't
mean that the policy cannot be changed (perhaps they decide to keep vehicles 15 years but she personall y
would not want to have a vehicle that is that old).
Councilmember Leger advised that typically when a vehicle comes up for purchase that item comes
before the Council and Ms. Ghetti concurred. Councilmember Leger said that he recalls that every time a
vehicle replacement item has been placed on an agenda the Council has drilled down on the item to ensure
that the purchase is a necessary one. He added that he shares the same concerns as his fellow
Councilmembers but noted that they do get "another shot at the apple" when the actual vehicle
replacements come before them for discussion and direction. He stated that he feels comfortable with the
policy knowing that each vehicle comes before them.
Councilmember Hansen pointed out that no one has made a better case for a vehicle replacement than the
Fire Chief. She asked whether she had read in one of the presentations that there was a plan to replace
four or five vehicles in the next fiscal year and Ms. Ghetti said there was but again they are revisiting t hat
whole plan and the $400,000 right now is just a placeholder. She added that after reviewing the policy
they are likely to make some changes to it and those changes may extend the lives of the some of the
vehicles. She noted that she believes there are a couple of vehicles that will need to go to auction.
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Mayor Schlum asked whether they had budgeted a similar amount this past year and Ms. Ghetti replied
that she believes they funded $100,000 and they purchased a fire vehicle and a Gator. She advised t hat
they spent the entire $100,000 (all on the Fire Department).
Vice Mayor Dickey said that as they review this, when they get to the actual hard numbers it is just like
everything else -- i.e. not waiting until the air conditioning units break to purchase a new one. She added
that she understands the philosophical discussion as well as the real part of it. She stated that she too
thinks they have a good policy and is relieved that they get a chance to look at the purchases as they arise.
Ms. Ghetti continued with her presentation and discussed "What's Next?" She advised that a Resolution
will be placed on the agenda of the May 3rd Council meeting to establish the maximum expenditures for
FY 2012-13. She noted that the maximum is based on projected revenues and does not bind the Council
from making changes to the proposed budget (they can make changes but not add revenues to the total
budget). She added that staff is planning to hold more budget meetings and if the Council wants to meet
tomorrow night and Wednesday night to review the budget again they can do so. She added that they are
also planning at the Work Study Session in June to have a budget session on the Capital Projects to get
into the details of those projects and another budget session at the first meeting in June and that agenda
item will be for budget discussion. She further stated that there will be a Work Study Session in June on
the budget and that will be with the newly seated Council and final adoption of the budget is scheduled t o
take place the end of June unless the Council would prefer to move quicker. She asked whether the
Council would still like to meet this Tuesday and Wednesday evenings for more dialogue on the budget.
She also questioned whether there are any items that staff has not provided information on that they
would like to have discussed.
Mayor Schlum asked how the public Open House went this evening and if staff received a lot of ideas
and/or feedback or concerns from the attendees.
Ms. Ghetti advised that two citizens attended and said that staff has spoken to the Realtors' group and will
speak to the Tea Party group in a couple of weeks (she and the Town Manager). She stated that they are
still available to any group that wants to listen to them or provide input/feedback relative to the proposed
budget. She noted that the Realtors did not ask one question.
Mayor Schlum pointed out that Mayor-Elect Kavanagh is always present and staff is also working with
the candidates and Ms. Ghetti confirmed that statement.
The Mayor asked what was shared at the meeting or in any e-mails received by staff and Ms. Ghetti
replied not much -- most of the conversations had to do with what the Town is planning to do with the
roads.
Councilmember Hansen stated that based on the schedule as outlined by Ms. Ghetti, she believes there
will still be a lot of opportunity for additional discussion without holding the Tuesday and Wednesday
evening meetings and the Mayor agreed.
There was consensus among the Council that the proposed Tuesday and Wednesday evening sessions will
not be required.
Ms. Ghetti informed the Council said that staff will still hold Open Houses on Tuesday and Wednesday
from 5:00 p.m. to 6:00 p.m. and staff will remain as long as necessary to speak to citizens, provide input
and solicit feedback. She reiterated that she and Mr. Buchanan will meet with the Tea Party group and
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there are no additional meetings planned at this point but again, staff is available to meet with any other
groups that are interested in doing that.
Mayor Schlum commented that he just wants to make sure that people don't miss out on that opportunity
and emphasized that staff is willing to go out and meet with anyone who is interested in doing so. He said
that parent feedback night might be helpful as well as discussion with the Senior groups. He said that he
knows that Mr. Buchanan has been at a couple of discussion groups and that has been good too. He
thanked staff for getting out there and stressed the importance of inviting people to be a part of this
process. The Mayor added that when citizens ask him about the budget generally he says that it is a little
easier to have discussion on the budget when they don't have discretionary dollars because they are really
spending where they need to spend. He said that this year there is a need to spend and they are
considering an increase in the budget, largely for the maintenance items that were deferred over the past
several years. He stated that perhaps that is why they are not receiving a great deal of feedback because
they are certainly not at previous levels. He added that hopefully they will get some good ideas and hear
about citizens' concerns. He noted that Ms. Bordow has provided the Council with some ideas on the
citizens' feedback so that is great and he encouraged the public to bring their ideas forward before the
Council adopts the budget rather than after.
There were no additional items to discuss and the Mayor asked for a motion to adjourn.
AGENDA ITEM #2 – ADJOURNMENT.
Councilmember Brown MOVED to adjourn the meeting and Councilmember Leger SECONDED the
motion, which CARRIED UNANIMOUSLY by those present (6-0). The Work Study Session adjourned
at 7:10 p.m.
TOWN OF FOUNTAIN HILLS
By __________________________
Linda M. Kavanagh, Mayor
ATTEST AND
PREPARED BY:
__________________________
Bevelyn J. Bender, Town Clerk
CERTIFICATION
I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Work Study
Session held by the Town Council of Fountain Hills in the Town Hall Council Chambers on the 30th day
of April, 2012. I further certify that the meeting was duly called and that a quorum was present.
DATED this 7th day of June, 2012.
_____________________________
Bevelyn J. Bender, Town Clerk