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HomeMy WebLinkAbout2020.0922.TCSM.MinutesTOWN OF FOUNTAIN HILLS MINUTES OF THE SPECIAL WORK SESSION OF THE FOUNTAIN HILLS TOWN COUNCIL SEPTEMBER 22, 2020 CALL TO ORDER AND PLEDGE OF ALLEGIANCE — Mayor Dickey Mayor Dickey called the Special Work Session of September 22, 2020, to order at 5:30 p.m. and led the Council and audience in the Pledge of Allegiance. 2. ROLL CALL — Mayor Dickey Present: Mayor Ginny Dickey; Vice Mayor Mike Scharnow; Councilmember Gerry Friedel; Councilmember Art Tolis; Councilmember Alan Magazine; Councilmember David Spelich Absent: Councilmember Dennis Brown Staff Town Manager Grady E. Miller; Town Attorney Aaron D. Arnson (telephonically); Present: Town Clerk Elizabeth A. Burke 3. REVIEW findings of the recently completed User Fee Study and provide direction to staff regarding adjustments to be implemented on 7/1/2021. Finance Director David Pock began the PowerPoint presentation which addressed: USER FEE BACKGROUND GENERAL FUND REVENUE OPTIONS FOR COUNCIL DIRECTION Mr. Miller said that he wanted to make it clear that this was not a situation where they engaged a consultant who came in and told them what to do. It was a two-way street with department directors very much involved in determining the fees. He added that they dropped some fees that were no longer relevant. Mr. Pock said that the contract with the consultant was $36,000. Mr. Miller noted that anything adopted will more than recover those costs. Mr. Pock then introduced Kevin Burnett with Willdan Financial who continued the PowerPoint presentation. PRESENTATION CONTENTS Mr. Burnett said that he and Pat Walker met with staff and had several conversations with Mr. Pock. He noted that Ms. Walker could not be at the meeting this evening as she had a vacation previously scheduled. He said that originally it was intended to be a three-month project for this fiscal year. GENERAL MODEL OVERVIEW Mr. Burnett said that they use 10% for townwide overhead/support costs. SALARIES METHODOLOGY COST RECOVERY Town Council Special Work Session of September 22, 2020 2of6 Mr. Burnett said that they could not defend charging over 100%, but in certain cases the Council may want to consider charging less than cost recovery at 100%. DEVELOPMENT FEES Planning Fees Building Fees Councilmember Spelich said that he did not see a fee for expediting services. Mr. Miller said that this is one of the areas that should be bearing the full cost; development should be paying the full rate. Miscellaneous Fees Fire Fees PUBLIC WORKS FEES Engineering Fees Mr. Miller said that this was another area where they would encourage getting as close to the 100% recovery as possible. Mr. Miller said that in the past, rather than charging an expedited services fee, they have been charged directly by the firm doing the expedited work, and that charge is typically higher than the fees. They are still coordinating that. Mr. Miller said that the traffic study may be required for a proposed project. He said that under the Town Code the Town has the ability to require one, but this would include the traffic study fee. Miscellaneous Fees Adopt -a -Street COMMUNITY SERVICES Park Fees Councilmember Tolis asked about the ability of the Town Manager to waive a fee, and what the reason may be to do so. Mayor Dickey said that today they are going over the fee schedule; that is a separate discussion. Councilmember Friedel asked if that would include nonresident fees for people using the facilities. Mayor Dickey said that it is covered in the proposed fees, but the other topic is for a different discussion. She said that the study gives the Council the actual costs which they have never had before, so the information can be used to make decisions down the road. Community Center Fees Special Event Fees COURT FEES Mr. Burnett said that this is a little different area in that it includes third -party costs, such as the public defender, and state statutes dictate what can and cannot be charged. CLERK FEES FINANCE FEES Mr. Miller said that the new alcohol renewal is talking about the commercial alcohol permits. He said that Fountain Hills is one of the few towns around the valley that do not have this. Town Council Special Work Session of September 22, 2020 3 of 6 Councilmember Magazine said that these are aggregate numbers, and he wondered if they would be looking at them individually. Mr. Miller said that under state law there is a 60-day notice requirement before new fees can go into effect. The clock started clicking when they put the packet out for tonight, and November 17 is the adoption date. When this comes back to the Council for action, staff is recommending that the fees go into effect on July 1, 2021. In the event that Council wanted to phase in some of the fees, he would recommend a three-year phase -in period. He said that if there is a fee that they would like to debate, it would be preferable that it take place tonight. Mr. Miller said that most cities/towns try not to recover more than 50% for seniors and youth programs, as a way to encourage them to take part in those activities. Vice Mayor Scharnow said that the report is recommending 100% cost recovery on just about everything. Mr. Miller said that is true, but it up to the Council as to how much of a cost recovery they wish to see. Vice Mayor Scharnow asked Mr. Burnett if they have done similar studies in Arizona. Mr. Burnett said that they have done them in California and Colorado, not in Arizona. However, Pat Walker was the finance director in Chandler for 20 years and the modeling is very similar to what she was familiar with. He said that he has never seen 100% across the board for everything. Parks and recreation is usually subsidized to some degree. Vice Mayor Scharnow said that the Town finally finished paying off the community center. He asked about phasing the increases. Mr. Burnett said that it gets into when it was last done and what has happened since the last study. In California, they have to do this every five years. There has not been a comprehensive study done before in Fountain Hills. Vice Mayor Scharnow said that they are accused of money grabbing, such as with the red light, but they can say that there will be some increases down the road. He said that $36,000 is relatively low. It was not to gouge groups; this is information they need to know. Councilmember Magazine said that he understands it is not a money grab, but they know what condition they are in. There is a reason they increased the sales tax. He is willing to give on some of this; they do need to charge for services rendered. Councilmember Friedel said that they left $150,000 on the table. He asked if there was any idea as to what the projection would be to recover that. Mr. Miller said to keep in mind that it is based on development. If there is a plunge in building, then they are not recovering as much. Mr. Pock said that Development Services is pretty much a department that should be funded by fees. They are providing services across the board. Last year's expenditures was at $800,000. This example is pretty close as to what it should be pulling in. Mr. Miller added that the $150,000 mentioned was a combination of Public Works and Development Services. Councilmember Magazine said that at this point, depending on further discussions, he would go with 100% except Community Services, cutting that in half and doing it July. Vice Mayor Scharnow said that he would agree with 50% for Community Services Community Services Director Rachael Goodwin noted that none of their program fees are part 4•_ of the schedule; tonight it was hard costs. She said that staff has the privilege of setting those Town Council Special Work Session of September 22, 2020 4of6 fees. She said that one example for tonight's discussion is with ramada rentals. Currently the fee for a resident is $10. Cost recovery is $25; the proposed fee is $15 for resident and $22.50 for non-resident. Currently the non-resident fee is $15. She said that a lot of the fees on the schedule bring them in line. In the Community Center, a classroom for two hours for a resident is $17. The cost of putting it together is $86; the recommendation is $25. Mayor Dickey confirmed that the idea of youth/seniors does not come into play. Vice Mayor Scharnow asked what accounts for most of the 94% change that was originally proposed. Ms. Goodwin replied that they were not endorsing 100% cost recovery; the number in the packet is what they are recommending. Mr. Pock said that the 94% increase is the average cost overall. Vice Mayor Scharnow asked how they treat things like Little League and Soccer. Ms. Goodwin said that they have broken out the athletic field preparations between rectangles and diamonds as diamonds take less time. Previously it was field prep in general. As for soccer, little league, etc. those fees are waived; this is for an outside group that is wanting to do a tournament. She added that they do currently charge $25 for field prep. Councilmember Spelich asked if staff thought it would be a detriment to increase the fees. Ms. Goodwin said that she did not. She said that with regard to ramadas, this puts them in a better position to recover what it takes. They have kept in mind that they do not want to price themselves out of the market. She said that they want to be in the middle column of the chart, which represents what is reasonable and practical. Councilmember Spelich said that he would not consider any of these to be astronomical. He believed they could charge more money to get the fields equipped for soccer. He said that he talked with the Town Manager and he thinks that, without delay, they need to have a meeting with the Town Council and staff. He is a firm believer that they need an exact accounting of the amount of what they give away. He would like a report on what is given away on a quarterly report. He said that if they raised these fees and start, he is for this. They should be transparent to the Town. When they raise these fees, people will be upset. They have a report that they spent $36,000 on. They can justify everything being asked for. He said that they should raise the fees accordingly and set firm policies of who is exempt and who is not so it takes the pressure off of the Town Manager, directors, etc. He said that he is all about fair and equitable. Vice Mayor Scharnow asked about the July 1 start date versus phasing in. Mr. Miller said that he was trying to ensure that any action that Council took was done outside of the budget process, but would still be effective 7/1/21. Councilmember Friedel asked if there are areas in which they are recovering all costs. Ms. Goodwin said that the proposed version is much closer. Much more than what is being proposed would price them out of the process. She said that they could not totally cost recover; they try to keep it at market rate and find the balance between that and cost recovery. Councilmember Friedel asked if they have a lot of nonresident use. Ms. Goodwin said that the Community Center has a high use of residents, with occasional weddings and special events from outside use. Also, the ball fields are getting well used right now. There is a lot of local usage and out of town ers--probably 50/50. Town Council Special Work Session of September 22, 2020 5of6 Mr. Miller said that the fields and facilities are limited resources with not enough to go around for use by residents and nonresidents. There would always be preference to grant fee waivers, if requested and considered, to residents versus nonresidents because of the scarcity of resources. Mayor Dickey emphasized that the rates being proposed on the sheet are not full cost recovery; they are value judgments. She said that they should go forward with the proposed fees, to go into effect July 1. Councilmember Magazine said that they are talking about $1/2 million. If the reason for phasing is to reduce the heat, he does not think it will have any impact at all. They need to rip the band aid off. Councilmember Spelich said that he agreed. He does not understand why they would not implement it January 1. Mr. Miller said that the recommended start date is more to coincide with the budget cycle. Brief discussion was held on the total revenues. Mr. Pock said that if the Council wants to go with the proposed fees, he will put the specific numbers in the fee schedule and have that presented on 11/17/20 and will provide the exact percentages. Councilmember Tolis asked if these fees are in line with other municipalities. Mr. Pock said that they had that discussion. They are trying to compare our fee schedule with others. It is tough to compare apples to oranges. Councilmember Spelich asked Mr. Wesley if he felt that any of these fees would impact development. Mr. Wesley said that fees vary greatly. From what he remembers, these would still be lower and he does not see anything that would give him a major concern. Vice Mayor Scharnow noted that some of the building fees are actually going down. Councilmember Spelich said that whatever they do tonight, he would like to see expedited fees for expedited services. Councilmember Magazine thanked the consultant and staff. He said that having been a consultant, he does not know how they did all of this for $36,000. Mr. Burnett said that staff did a lot of the heavy lifting. Mr. Pock said that the direction he is hearing is to go with the proposed fees in the report with no phasing. He said that he would prepare the comprehensive fee schedule and send that out to see it in the final form and post it. Councilmember Spelich asked how soon they would have a meeting to discuss policy. Mr. Miller said that it would take three to four weeks for staff to look at it before it would come back to Council. Mayor Dickey thanked the staff and said that next time it will be a lot easier. 4. ADJOURNMENT MOVED BY Councilmember David Spelich, SECONDED BY Councilmember Alan Magazine to adjourn. Vote: 6 - 0 Passed - Unanimously Town Council Special Work Session of September 22, 2020 6 of 6 The Special Work Session of the Fountain Hills Town Council held September 22, 2020, adjourned at 6:56 p.m. TOWN OF FOUNTAIN HILLS GinUhf DickeOMayor �— ATTEST AND PREPARED BY: Elizabet . Burke, Town erk