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HomeMy WebLinkAboutCity Council Meeting - Council - Minutes - 12/16/2014 11Z KENT Kent City Council Special Meeting Minutes December 16, 2014 The Special Meeting of the Kent City Council was called to order at 5:03 p.m. by Council President Ralph. Councilmembers present: Ralph, Barrios, Boyce, Fincher, Ranniger, and Thomas. Mayor Cooke was excused from the meeting. Chief Administrative Officer Derek Matheson recommended that the Executive Session be deleted from the agenda. PUBLIC COMMENT 1. Tom Sharp, Maple Valley - Sharp discussed the ShoWare Center and that the City has paid $18.5 million on the facility thusfar. He noted that the loan would produce a $200 million committment to the facility. He added that the City needs its roads fixed, a new police department, etc. He communicated that the ShoWare Center is a tax on the City, not a loan or a gift. He stated it may be great politics to sweep all of this under the rug, but its horrible governance. The ShoWare Center doesn't benefit the entire City, he commented. He stated that the City needs to work on its infrastructure, to include parks. He suggested hiring a consultant and getting a third party opinion. 2. Gene Bremner, Kent - Bremner stated that if you have a business and if it doesn't make money, you get rid of it. He stated that the golf course hasn't been a big draw for Kent for the 35 years he has resided here. He discussed the $20 tab fee and asked that it be deleted. Council President Ralph noted that the $20 tab fee wasn't on the agenda tonight and will not be voted on. 3, Eric Bernard, Kent - Bernard discussed the $25 million for the Fire Department and noted that Councilmember Boyce called him about it. He noted that it still seems that the City saved the $25 million, but reallocated it elsewhere. He communicated that the Council endorsed the Regional Fire Authority and the ShoWare Center that are two large facilities that are taxing the City in which don't make any revenues. He stated that with two separate taxing entities the residents are paying double now. He stated that it is cheaper to live on Mercer Island and that there isn't an RFA there. He suggested the Council reconsider raising property taxes and felt the garbage tax also needs to be removed. Councilmember Boyce stated that he did speak to Eric concerning the $25 million and explained what occurred with the funds. OTHER BUSINESS A. Adopt Ordinance No. 4133, levying the Property taxes for the first year of the 2015-2016 biennial budget - Councilmember Thomas communicated that he felt that a property tax wasn't necessary and there were funds available. Kent City Council Special Meeting Minutes December 16, 2014 Councilmember Higgins communicated that this budget isn't an ideal budget and the City has a structural imbalance. He noted that the City has grown from 40,000 residents to over 120,000 and the budget was designed to sustain a population of 40,000, not the 120,000 that it is now. The imbalance must be addressed prior to the next biennial budget to compare the tax burdens of other cities and examine everything. He communicated that a citizens review panel needs to be created. He stated that the Councilmembers are also taxpayers and live here. He noted the Council is trying to find the least expensive way to keep services going in the City. He stated they are trying to find the best solutions to keep faith with the residents. Councilmember Boyce moved to adopt Ordinance No. 4133, levying the property taxes for the first year of the 2015-2016 biennial budget, seconded by Councilmember Higgins. Motion carried 6-1. Councilmember Thomas oppossed. B. Adopt Ordinance Nos. 4134 through 4137 and Resolution No. 1902, enacting the 2015 - 2016 biennial budgets Councilmember Thomas moved to adopt Ordinance Nos. 4134 through 4137 and Resolution No. 1902, enacting the 2015-2016 biennial budgets, seconded by Councilmember Barrios. Motion carried 7-0. Councilmember Thomas communicated that there were some compromises made within this budget that were quite good, and in which he supports. Councilmember Berrios communicated that this has been a rough seven years; however, we are not out of the weeds yet. He noted that there needs to be some viable solutions and decisions made to move the City forward. He thanked the City staff for their work and time spent attempting to come up with those solutions. He stated that the earnest effort made to do the right thing for the community is why he is voting yes. He urged the Council and staff to keep the B&O for roads and only roads because that is what the businesses were promised. He added that he had a tough time with the garbage tax and that any funds that have been taxed will go to the streets that need the work. The conversations about the ShoWare are tough and the potential is great, but it continues to lose money. He stated that a citizen budget review committee to develop viable solutions would be beneficial to the City. He stated that the Economic Development needs to continue to bring businesses to the City as well. Councilmember Boyce said that for many years the City was saying "No". As a Councilmember, he said, he doesn't have the option of just turning his back. He said the difficult decisions have had to be made. He noted that a deep dive was taken on this and highlighted the property tax per year. He added that the ShoWare is his pet peeve, but the City must work to make it work. He communicated that he will be supporting the motion and will continue to look for ways to maximize every dollar taken in with the least impact on the citizens. Council President Ralph thanked all of the City employees and department heads. She stated that the employees do an amazing job for the City, often doing the job of 2 Kent CityCouncil Special Meeting Minutes December 16 2014 p 9 multiple people. She thanked the Councilmembers and stated that this budget isn't perfect, but is a compromise on several levels. In this current world, compromize is important. As a City, we are limited on how it can pay for services and we have done a good job at keeping those things in place despite the reduction of streamline sales tax. She added that coming up with a reserve account is a smart decision and maintaining it in case of an emergency is critical to keep things running. She noted that the Council is attempting to meet the expectations of the City and in February the Council will ask for a Citizen's Advisory Board to hear what the residents want to keep, what can be reduced and how it will be funded. She discussed the $20 vehicle tab fee and stated that the property tax is less than what an average family of two cars would pay. C. Adopt Comprehensive Plan Amendment and Update to Kent City Code Regarding School Impact Fees, Ordinances Councilmember Thomas moved to adopt Ordinances 4138 and 4139 updating the capital facilities element of the Kent Comprehensive Plan in Chapters 12.13 in Kent City Code to incorporate the 2014/15-2019/20 Capital Facilities Codes, Kent, Federal Way, Auburn and Highline School Districts updating school impact fees, seconded by Councilmember Higgins. Motion carried 7-0. D. First Amendment to Contingent Loan and Support Agreement between the City of Kent and the Special Events Center Public Facilities District - Authorize Aaron BeMiller, Finance Director presented the item. He communicated that the City has given $18 million (82%) to the Public Facilities District and stated that the agreement will change the language from loan to subsidy. Loan payment made without expectation of repayment is not a loan, and per state auditors this is the best approach. Councilmember Boyce moved to table this item to December 15, 2015 Council meeting, second by Councilmember Thomas. Councilmember Higgins verified with Chief Administrative Officer Matheson that this would be noted on the City's 2014 books as a loan due, but not likely to be paid and on the PFD books as a loan. Councilmember Higgins noted that there is the immediate bookkeeping order at hand and how to save money for the residents when it comes to the ShoWare. He stated that it would make sense to accept reality and note that this isn't a loan the ShoWare would ever pay back. He said that tableing it for a year would be counterproductive. Councilmember Thomas stated that in the Operations Committee none of the members could make a motion on this. He noted that the Committee didn't feel comfortable with moving forward with this. Councilmember Fincher stated that she is concerned with the audit finding to which Matheson communicated that the audit finding issue would be addressed with putting the funds in a subsidy or making notation on both the City and PFD's financial statements. 3 Kent City Council Special Meeting Minutes December 16, 2014 Councilmember Fincher verified that the notation addresses the State Auditor's Office issue. Councilmember Berrios appreciated the motion as an option and stated that he isn't comfortable with this. He added that six years ago it was introduced as a money maker and thusfar it isn't. He said he isnt' comfortable with the option of them not being able to pay on the loan. Councilmember Boyce stated that he is having a hard time with this and isn't an accountant. He noted that there is an obligation of debt here and that he isn't to the point of writing this debt off. Councilmember Fincher stated that at the last Council meeting Councilmember Berrios inquired about payback and any money that ShoWare does make would come back to the City. However, it would have to be voted on. Matheson confirmed that if the Council and the PFD approved this agreement a subsequent amendment would have to be done to turn the subsidy back into a loan. Matheson further explained that if both parties agree to turn the loan into a subsidy, both would have to agree to reverse that in the future Councilmember Berrios verified that unless there is language to that point can that be done. He stated there should be wording within the amendment stating that there could be a payback without both parties having to agree to it. He said it is a form of accountability owed to the citizens of Kent. Council moved to remove the original motion from the table. Councilmember Higgins moved to hear the amendment by the end of the first quarter 2015, seconded by Councilmember Ranniger. Motion carried 7-0. EXECUTIVE SESSION None. ACTION AFTER EXECUTIVE SESSION None. ADJOURNMENT The meeting adjourned at 5:25 p.m. Ronald . Moore,MMC City Clerk 4 11Z KENT Kent City Council Special Meeting Minutes December 16, 2014 The Special Meeting of the Kent City Council was called to order at 5:03 p.m. by Council President Ralph. Councilmembers present: Ralph, Barrios, Boyce, Fincher, Ranniger, and Thomas. Mayor Cooke was excused from the meeting. Chief Administrative Officer Derek Matheson recommended that the Executive Session be deleted from the agenda. PUBLIC COMMENT 1. Tom Sharp, Maple Valley - Sharp discussed the ShoWare Center and that the City has paid $18.5 million on the facility thusfar. He noted that the loan would produce a $200 million committment to the facility. He added that the City needs its roads fixed, a new police department, etc. He communicated that the ShoWare Center is a tax on the City, not a loan or a gift. He stated it may be great politics to sweep all of this under the rug, but its horrible governance. The ShoWare Center doesn't benefit the entire City, he commented. He stated that the City needs to work on its infrastructure, to include parks. He suggested hiring a consultant and getting a third party opinion. 2. Gene Bremner, Kent - Bremner stated that if you have a business and if it doesn't make money, you get rid of it. He stated that the golf course hasn't been a big draw for Kent for the 35 years he has resided here. He discussed the $20 tab fee and asked that it be deleted. Council President Ralph noted that the $20 tab fee wasn't on the agenda tonight and will not be voted on. 3, Eric Bernard, Kent - Bernard discussed the $25 million for the Fire Department and noted that Councilmember Boyce called him about it. He noted that it still seems that the City saved the $25 million, but reallocated it elsewhere. He communicated that the Council endorsed the Regional Fire Authority and the ShoWare Center that are two large facilities that are taxing the City in which don't make any revenues. He stated that with two separate taxing entities the residents are paying double now. He stated that it is cheaper to live on Mercer Island and that there isn't an RFA there. He suggested the Council reconsider raising property taxes and felt the garbage tax also needs to be removed. Councilmember Boyce stated that he did speak to Eric concerning the $25 million and explained what occurred with the funds. OTHER BUSINESS A. Adopt Ordinance No. 4133, levying the Property taxes for the first year of the 2015-2016 biennial budget - Councilmember Thomas communicated that he felt that a property tax wasn't necessary and there were funds available. Kent City Council Special Meeting Minutes December 16, 2014 Councilmember Higgins communicated that this budget isn't an ideal budget and the City has a structural imbalance. He noted that the City has grown from 40,000 residents to over 120,000 and the budget was designed to sustain a population of 40,000, not the 120,000 that it is now. The imbalance must be addressed prior to the next biennial budget to compare the tax burdens of other cities and examine everything. He communicated that a citizens review panel needs to be created. He stated that the Councilmembers are also taxpayers and live here. He noted the Council is trying to find the least expensive way to keep services going in the City. He stated they are trying to find the best solutions to keep faith with the residents. Councilmember Boyce moved to adopt Ordinance No. 4133, levying the property taxes for the first year of the 2015-2016 biennial budget, seconded by Councilmember Higgins. Motion carried 6-1. Councilmember Thomas oppossed. B. Adopt Ordinance Nos. 4134 through 4137 and Resolution No. 1902, enacting the 2015 - 2016 biennial budgets Councilmember Thomas moved to adopt Ordinance Nos. 4134 through 4137 and Resolution No. 1902, enacting the 2015-2016 biennial budgets, seconded by Councilmember Barrios. Motion carried 7-0. Councilmember Thomas communicated that there were some compromises made within this budget that were quite good, and in which he supports. Councilmember Berrios communicated that this has been a rough seven years; however, we are not out of the weeds yet. He noted that there needs to be some viable solutions and decisions made to move the City forward. He thanked the City staff for their work and time spent attempting to come up with those solutions. He stated that the earnest effort made to do the right thing for the community is why he is voting yes. He urged the Council and staff to keep the B&O for roads and only roads because that is what the businesses were promised. He added that he had a tough time with the garbage tax and that any funds that have been taxed will go to the streets that need the work. The conversations about the ShoWare are tough and the potential is great, but it continues to lose money. He stated that a citizen budget review committee to develop viable solutions would be beneficial to the City. He stated that the Economic Development needs to continue to bring businesses to the City as well. Councilmember Boyce said that for many years the City was saying "No". As a Councilmember, he said, he doesn't have the option of just turning his back. He said the difficult decisions have had to be made. He noted that a deep dive was taken on this and highlighted the property tax per year. He added that the ShoWare is his pet peeve, but the City must work to make it work. He communicated that he will be supporting the motion and will continue to look for ways to maximize every dollar taken in with the least impact on the citizens. Council President Ralph thanked all of the City employees and department heads. She stated that the employees do an amazing job for the City, often doing the job of 2 Kent CityCouncil Special Meeting Minutes December 16 2014 p 9 multiple people. She thanked the Councilmembers and stated that this budget isn't perfect, but is a compromise on several levels. In this current world, compromize is important. As a City, we are limited on how it can pay for services and we have done a good job at keeping those things in place despite the reduction of streamline sales tax. She added that coming up with a reserve account is a smart decision and maintaining it in case of an emergency is critical to keep things running. She noted that the Council is attempting to meet the expectations of the City and in February the Council will ask for a Citizen's Advisory Board to hear what the residents want to keep, what can be reduced and how it will be funded. She discussed the $20 vehicle tab fee and stated that the property tax is less than what an average family of two cars would pay. C. Adopt Comprehensive Plan Amendment and Update to Kent City Code Regarding School Impact Fees, Ordinances Councilmember Thomas moved to adopt Ordinances 4138 and 4139 updating the capital facilities element of the Kent Comprehensive Plan in Chapters 12.13 in Kent City Code to incorporate the 2014/15-2019/20 Capital Facilities Codes, Kent, Federal Way, Auburn and Highline School Districts updating school impact fees, seconded by Councilmember Higgins. Motion carried 7-0. D. First Amendment to Contingent Loan and Support Agreement between the City of Kent and the Special Events Center Public Facilities District - Authorize Aaron BeMiller, Finance Director presented the item. He communicated that the City has given $18 million (82%) to the Public Facilities District and stated that the agreement will change the language from loan to subsidy. Loan payment made without expectation of repayment is not a loan, and per state auditors this is the best approach. Councilmember Boyce moved to table this item to December 15, 2015 Council meeting, second by Councilmember Thomas. Councilmember Higgins verified with Chief Administrative Officer Matheson that this would be noted on the City's 2014 books as a loan due, but not likely to be paid and on the PFD books as a loan. Councilmember Higgins noted that there is the immediate bookkeeping order at hand and how to save money for the residents when it comes to the ShoWare. He stated that it would make sense to accept reality and note that this isn't a loan the ShoWare would ever pay back. He said that tableing it for a year would be counterproductive. Councilmember Thomas stated that in the Operations Committee none of the members could make a motion on this. He noted that the Committee didn't feel comfortable with moving forward with this. Councilmember Fincher stated that she is concerned with the audit finding to which Matheson communicated that the audit finding issue would be addressed with putting the funds in a subsidy or making notation on both the City and PFD's financial statements. 3 Kent City Council Special Meeting Minutes December 16, 2014 Councilmember Fincher verified that the notation addresses the State Auditor's Office issue. Councilmember Berrios appreciated the motion as an option and stated that he isn't comfortable with this. He added that six years ago it was introduced as a money maker and thusfar it isn't. He said he isnt' comfortable with the option of them not being able to pay on the loan. Councilmember Boyce stated that he is having a hard time with this and isn't an accountant. He noted that there is an obligation of debt here and that he isn't to the point of writing this debt off. Councilmember Fincher stated that at the last Council meeting Councilmember Berrios inquired about payback and any money that ShoWare does make would come back to the City. However, it would have to be voted on. Matheson confirmed that if the Council and the PFD approved this agreement a subsequent amendment would have to be done to turn the subsidy back into a loan. Matheson further explained that if both parties agree to turn the loan into a subsidy, both would have to agree to reverse that in the future Councilmember Berrios verified that unless there is language to that point can that be done. He stated there should be wording within the amendment stating that there could be a payback without both parties having to agree to it. He said it is a form of accountability owed to the citizens of Kent. Council moved to remove the original motion from the table. Councilmember Higgins moved to hear the amendment by the end of the first quarter 2015, seconded by Councilmember Ranniger. Motion carried 7-0. EXECUTIVE SESSION None. ACTION AFTER EXECUTIVE SESSION None. ADJOURNMENT The meeting adjourned at 5:25 p.m. Ronald . Moore,MMC City Clerk 4