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HomeMy WebLinkAboutCity Council Committees - Operations - 08/04/1998 OPERATIONS COMMITTEE MINUTES AUG. 49 1998 COUNCIL COMMITTEE MEMBERS PRESENT: JudyWoods, Chair, Sandy Amodt, Tim Clark STAFF PRESENT: Brent McFall, May Miller, John Hodgson, Dena Laurent, Marty Mulholland, Cheryl Viseth OTHERS PRESENT: Council Members: Leona Orr, Tom Brotherton, Rico Yingling Public: Barbara Ivanov, Sam Pace The meeting was called to order at 5:30 PM by Chairperson Woods Approval of Combined Check Detail Vouchers Dated 7/31/98 Operations Director, Brent McFall, presented and recommended the vouchers, dated July 31, 1998, in the amount of$2,533,136.06 for council approval. Tim Clark moved to approve the vouchers. The motion was carried with a vote of 3-0. Draft Downtown Marketing Plan Dena Laurent, Government Affairs Director, presented The Downtown Marketing Plan, which she broke down into four stages. Stage 1 is bringing all the information and data together. Stage 2 is outreach- building relationships with property owners, developers, brokers, and industry decision- makers. Stage 3 broadens the outreach into relationships with new businesses, supports retention and expansion efforts, and builds our image regionally and statewide. Stage 4 is fine-tuning and evaluating the success of efforts. Councilmember, Tim Clark, asked about transportation alternatives and different corridor routes, and if Metro will make the downtown more worker accessible. Mr McFall responded that a rerouting of bus lines to provide better access from suburban locations to downtown will be designed primarily to support the commuter rail system but will also provide an alternative route to the downtown to work and shop. Councilmember, Sandy Amodt, asked about the preference for owner occupied condos. Ms. Laurent responded that the housing preferences are from the Kent Downtown Strategic Action Plan and based on growth management and housing targets. Brent McFall added that the Planned Unit Development states that the design be specific to owner-occupied. Committee Chair, Judy Woods, asked about a time line for accomplishing the plan. Ms. Laurent responded that this plan underpins last year's Capital Plan by doing a design identity. The signage and gateways repeat the image that the corporate site locator would have seen in Kent's marketing material. Ms. Laurent said the downtown image pieces of the plan would be brought to the Committee of the Whole meeting, Sept. 1. Ms. Woods asked about adding staff in order to fulfill the City's mission. Brent McFall responded that the City would be looking at that as part of the 1999 budget in terms of making recommendations to the Council. %4% Real Estate Excise Tax Ordinance Brent McFall discussed the need for a funding source for Parks development. Some park acquisition has been done in underserved areas, and also some property acquisition for active recreation facilities such as ball fields and playfields. However, there has not been the funding to do the actual development of those new facilities. Two sources of funding were identified. One would be a voter approved bond issue (which would require 60% voter approval) to levy an excess property tax of which the proceeds would be utilized to make the principle and interest payments on bonds sold to finance the development of parks projects. The second source of funds is real estate excise tax. In 1990, along with the Growth Management Act, the state legislature authorized cities to increase their existing 1/4 of 1 % real estate excise tax by an additional 1/4 of 1 % for a total of/z% real estate excise tax. This tax is collected on the sales value of property at the time it is sold. The funds can be used for planning acquisitions, construction, reconstruction, repair, replacement, rehabilitation or improvement of streets, roads, highways, sidewalks, street and road lighting systems, traffic signals, bridges and water systems, storm and sanitary sewer systems; planning and construction, reconstruction, repair and rehabilitation or improvement of parks. The first '/4 of 1% of these funds can be used for land acquisition but the second '/4 % cannot This source of funds has been widely utilized by other cities around the sound. Renton, Auburn, Des Moines, Federal Way, Seattle, Tacoma,Normandy Park, Redmond, Mercer Island, Everett,New Castle, Olympia, Puyallup, Bellevue, Burien, Issaquah, and Kirkland are all levying this tax Mr. McFall stated that the regional market is already adjusted for this tax and the price of property in Kent has already been adjusted because the tax is being collected in the other cities in the region. John Hodgson, director of the Parks & Recreation Department, said that the City has purchased and acquired a number of properties to develop athletic fields for youth and to build neighborhood parks in areas that are deficient. Redevelopment has been done with grants and with the first CIP, but the funds do not exist to do projects that are being looked at now. The real estate excise tax would allow a match of money in the CIP that is projected to be available in the Parks Department budget over the next few years. Brent McFall made the distinction between utilizing bond proceeds as opposed to utilizing real estate tax. By selling bonds, the City could obtain a large lump sum of cash at one time. In order to be in compliance with IRS regulations with respect to arbitrage, the funds would need to be expended within a three-year period This would put the Parks Department staff in overload to be able to accomplish all projects and still meet the financial requirements for IRS and arbitrage regulations. The real estate excise tax would allow the City to cash flow those projects, which would be done over a longer period of time but in a more manageable way Sam Pace, representing the 5,000 realtors in King County and president-elect of the 32,000 member Washington Association of Realtors, commented that the realtors see a significant undefined list of infrastructure challenges that Kent is likely to confront, and questioned whether the Parks list of projects is really the place to spend this particular money. Mr. Pace questioned whether this would really be net increase of new revenues for Parks or whether in fact it would be replacement revenues for other projects. A second concern of the realtors is that only the people who sell their homes pay this tax while everybody uses parks. They favor a more broad-based approach such as a bond. Barbara Ivanov, president of the Kent Chamber of Commerce, mentioned a letter received from Mike Morelli whose primary issue is his concern that the tax is specific to the sale of property and is not broad-based to all users. Tim Clark moved that the Operations Committee recommend to the Council adoption of the ordinance implementing the second 1/4 of 1% Real Estate Excise Tax as provided by state law. Sandy Amodt stated that her preference is for the citizens to vote on the addition of new taxes and that the Council has that option to present this new tax to the citizens. The motion was put to a vote and carried 2-1. Sandy Amodt dissented. The motion will be moved to Council in September under other business. PC Purchase Request for()notes Marty Mulholland gave an update on the purchase of 75 Pentium II computers This is a competitive purchase and is the first time that the City has asked for sealed quotes for Pentium machines and PCs Material was faxed to 6 suppliers and there have been 10 additional requests for quotes. Sandy Amodt questioned why the bid was changed to a sealed quote. Brent McFall responded that they wanted a certain, specific product with the best price on the quantities needed and also wanted to differentiate this project from Public Works projects. Mr. McFall further added that the sealed quote process is actually still a sealed bid process that will be analyzed and then reported to the Council. Code of Ethics Policy Roger Lubovich reviewed the difficulties in grafting an ordinance for the Council because of the many laws relating to Council member conduct in performing the responsibilities and duties as a public official. Mr. Lubovich explained that the Council has no ability to enforce the laws to remove or discipline a councilmember. Mr. Lubovich informed the committee members that he had drafted an alternate/substitute version rather than tie the Code of Ethics to a particular chapter, specifically the one in the packet, 42.23, which deals with some prohibited conduct. Copies of the alternate version were passed out to Committee Members Mr. Lubovich stated that the resolution basically restates the Council's commitment to action within the bounds of the law. He reiterated that the Council has no enforcement authority, but members can review council action, write letters, or make verbal or oral reprimand to a Councilmember. Tim Clark asked for clarification on whether the Council could go ahead and issue letters of reprimand at the vote of the Council. Roger Lubovich affirmed that the Council has the authority to review conduct. Mr. Clark moved to adopt the substitute Ethics Code and pass it on to the Council. The motion was carried 3-0 June 1998 Financial Report A Summary Financial Report was passed out to Committee Members. May Miller, Finance Division Director, presented the first six months report and included a preliminary budget column. Ms. Miller said the sales tax has continued strong through June The City is about$1,000,000 over budget, but still on target Building Permits continue to be about 10% over budget, Golf continues to be about $159,000 under budget. As an update to the overall General Budget and forecast for next year, Ms. Miller stated that the CPIW has increased from 2.3 to 2.9 which has taken more money away from next year's budget. The Implicit Price Deflator that shows what is recommended as a Referendum 47 property tax increase went from 1.9 down to 16. That amounts to $150,000 that property taxes can be increased. Brent McFall clarified that the 1 % on the Implicit Price Deflator is the amount by which property tax collections can grow. It does not mean a 1 %tax increase. Mr. McFall stated that, in fact, a 1 % growth in collections would result in a property rate reduction. Chairperson, Judy Woods, made a note of the next meeting change from Aug. 18`h to Aug. 25`h at 3:30 PM in the afternoon. There being no further business, the meeting was adjourned. OPERATIONS COMMITTEE MINUTES AUG. 491998 COUNCIL COMMITTEE MEMBERS PRESENT: JudyWoods, Chair, Sandy Amodt, Tim Clark STAFF PRESENT: Brent McFall, May Miller, John Hodgson, Dena Laurent, Marty Mulholland, Cheryl Viseth OTHERS PRESENT: Council Members: Leona Orr, Tom Brotherton, Rico Yingling Public: Barbara Ivanov, Sam Pace The meeting was called to order at 5:30 PM by Chairperson Woods Approval of Combined Check Detail Vouchers Dated 7/31/98 Operations Director, Brent McFall,presented and recommended the vouchers, dated July 31, 1998, in the amount of$2,533,136.06 for council approval. Tim Clark moved to approve the vouchers. The motion was carried with a vote of 3-0. Draft Downtown Marketing Plan Dena Laurent, Government Affairs Director,presented The Downtown Marketing Plan, which she broke down into four stages Stage 1 is bringing all the information and data together. Stage 2 is outreach -building relationships with property owners, developers,brokers, and industry decision- makers. Stage 3 broadens the outreach into relationships with new businesses, supports retention and expansion efforts, and builds our image regionally and statewide Stage 4 is fine-tuning and evaluating the success of efforts. Councilmember, Tim Clark, asked about transportation alternatives and different corridor routes, and if Metro will make the downtown more worker accessible. Mr. McFall responded that a rerouting of bus lines to provide better access from suburban locations to downtown will be designed primarily to support the commuter rail system but will also provide an alternative route to the downtown to work and shop. Councilmember, Sandy Amodt, asked about the preference for owner occupied condos. Ms. Laurent responded that the housing preferences are from the Kent Downtown Strategic Action Plan and based on growth management and housing targets. Brent McFall added that the Planned Unit Development states that the design be specific to owner-occupied. Committee Chair, Judy Woods, asked about a time line for accomplishing the plan. Ms. Laurent responded that this plan underpins last year's Capital Plan by doing a design identity. The signage and gateways repeat the image that the corporate site locator would have seen in Kent's marketing material. Ms. Laurent said the downtown image pieces of the plan would be brought to the Committee of the Whole meeting,Sept. 1. Ms. Woods asked about adding staff in order to fulfill the City's mission Brent McFall responded that the City would be looking at that as part of the 1999 budget in terms of making recommendations to the Council. %% Real Estate Excise Tax Ordinance Brent McFall discussed the need for a funding source for Parks development. Some park acquisition has been done in underserved areas, and also some property acquisition for active recreation facilities such as ball fields and playfields However, there has not been the funding to do the actual development of those new facilities. Two sources of funding were identified. One would be a voter approved bond issue (which would require 60%voter approval) to levy an excess property tax of which the proceeds would be utilized to make the principle and interest payments on bonds sold to finance the development of parks projects. The second source of funds is real estate excise tax. In 1990, along with the Growth Management Act,the state legislature authorized cities to increase their existing 1/4 of 1 %real estate excise tax by an additional 1/4 of 1 % for a total of 1/2%real estate excise tax. This tax is collected on the sales value of property at the time it is sold. The funds can be used for planning acquisitions, construction, reconstruction, repair, replacement, rehabilitation or improvement of streets, roads, highways, sidewalks, street and road lighting systems,traffic signals, bridges and water systems, storm and sanitary sewer systems; planning and construction, reconstruction, repair and rehabilitation or improvement of parks. The first 1/4 of 1% of these funds can be used for land acquisition but the second 1/4 % cannot. This source of funds has been widely utilized by other cities around the sound Renton, Auburn, Des Moines, Federal Way, Seattle, Tacoma,Normandy Park, Redmond, Mercer Island, Everett,New Castle, Olympia, Puyallup, Bellevue,Burien, Issaquah, and Kirkland are all levying this tax. Mr. McFall stated that the regional market is already adjusted for this tax and the price of property in Kent has already been adjusted because the tax is being collected in the other cities in the region. John Hodgson, director of the Parks& Recreation Department, said that the City has purchased and �. IItt acquired a number of properties to develop athletic fields for youth and to build neigh rhood parks inV` 1, areas that are deficient. Redevelopment has been done with grants and with the firs VI h but the funds 6 do not exist to do rojects that are being looked at now. The real estate excise tax wo allow a match of money in the VI that is projected to be available in the Parks Department budget over the next few years OQ Brent McFall made the distinction between utilizing bond proceeds as opposed to utilizing real estate tax By selling bonds,the City could obtain a large lump sum of cash at one time. In order to be in compliance with IRS regulations with respect to arbitrage,the funds would need to be expended within a three-year period. This would put the Parks Department staff in overload to be able to accomplish all projects and still meet the financial requirements for IRS and arbitrage regulations. The real estate excise tax would allow the City to cash flow those projects, which would be done over a longer period of time but in a more manageable way, Sam Pace,representing the 5,000 realtors in King County and president-elect of the 32,000 member Washington Association of Realtors,commented that the realtors see a significant undefined list of infrastructure challenges that Kent is likely to confront, and questioned whether the Parks list of projects is really the place to spend this particular money. Mr. Pace questioned whether this would really be net increase of new revenues for Parks or whether in fact it would be replacement revenues for other projects. A second concern of the realtors is that only the people who sell their homes pay this tax while everybody uses parks. They favor a more broad-based approach such as a bond. Barbara Ivanov,president of the Kent Chamber of Commerce, mentioned a letter received from Mike Morelli whose primary issue is his concern that the tax is specific to the sale of property and is not broad-based to all users. Tim Clark moved that the Operations Committee recommend to the Council adoption of the ordinance implementing the second 1/4 of 1%Real Estate Excise Tax as provided by state law Sandy Amodt stated that her preference is for the citizens to vote on the addition of new taxes and that the Council has that option to present this new tax to the citizens. The motion was put to a vote and carried 2-1. Sandy Amodt dissented. The motion will be moved to Council in September under other business. PC Purchase Reguest for Quotes Marty Mulholland gave an update on the purchase of 75 Pentium II computers This is a competitive purchase and is the first time that the City has asked for sealed quotes for Pentium machines and PCs Material was faxed to 6 suppliers and there have been 10 additional requests for quotes. Sandy Amodt questioned why the bid was changed to a sealed quote. Brent McFall responded that they wanted a certain, specific product with the best price on the quantities needed and also wanted to differentiate this project from Public Works projects. Mr. McFall further added that the sealed quote process is actually still a sealed bid process that will be analyzed and then reported to the Council. Code of Ethics Policy Roger Lubovich reviewed the difficulties in grafting an ordinance for the Council because of the many laws relating to Council member conduct in performing the responsibilities and duties as a public official. Mr. Lubovich explained that the Council has no ability to enforce the laws to remove or discipline a councilmember. Mr. Lubovich informed the committee members that he had drafted an alternate/substitute version rather than tie the Code of Ethics to a particular chapter, specifically the one in the packet, 42.23, which deals with some prohibited conduct. Copies of the alternate version were passed out to Committee Members Mr. Lubovich stated that the resolution basically restates the Council's commitment to action within the bounds of the law. He reiterated that the Council has no enforcement authority, but members can review council action, write letters, or make verbal or oral reprimand to a Councilmember. Tim Clark asked for clarification on whether the Council could go ahead and issue letters of reprimand at the vote of the Council Roger Lubovich affirmed that the Council has the authority to review conduct. Mr Clark moved to adopt the substitute Ethics Code and pass it on to the Council. The motion was carried 3-0 June 1998 Financial Report A Summary Financial Report was passed out to Committee Members. May Miller, Finance Division Director,presented the first six months report and included a preliminary budget column. Ms Miller said the sales tax has continued strong through June. The City is about$1,000,000 over budget, but still on target. Building Permits continue to be about 10% over budget, Golf continues to be about$159,000 under budget. As an update to the overall General Budget and forecast for next year, Ms. Miller stated that the CPIW has increased from 2 3 to 2.9 which has taken more money away from next year's budget. The Implicit Price Deflator that shows what is recommended as a Referendum 47 property tax increase went from 1.9 down to 1.6. That amounts to $150,000 that property taxes can be increased. Brent McFall clarified that the 1 % on the Implicit Price Deflator is the amount by which property tax collections can grow It does not mean a 1 %tax increase. Mr. McFall stated that, in fact, a 1 % growth in collections would result in a property rate reduction. Chairperson, Judy Woods, made a note of the next meeting change from Aug. 18`h to Aug. 25`h at 3:30 PM in the afternoon There being no further business, the meeting was adjourned.