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HomeMy WebLinkAbout1989-09-19 MinutesMINUTES OF A MEETING OF THE CITY BOARD OF DIRECTORS A regular meeting of the Fayetteville City Board of Directors was held on Tuesday, September 19, 1989 at 7:30 p.m. in the Directors' Room of the City Administration Building, 113 West Mountain Street, Fayetteville, Arkansas. PRESENT: Mayor William V Martin; Directors Ernest Lancaster, Russ Kelley, Paul Marinoni, Jr., Shell Spivey, Fred Vorsanger and Mike Green; City Manager James Pennington, City Attorney Jerry Rose and City Clerk Suzanne McWethy; members of the staff, press and audience CALL TO ORDER 313.1 The meeting was called to order by the Mayor with seven Directors present. The Mayor asked those present to stand and recite the Pledge of Allegiance and observe a moment of respectful silence. 313.2 The Mayor welcomed the members of the public watching on television and those present in the audience. He said everyone would be given an opportunity to address the Board on every issue under discussion. He asked that citizens approach the podium and state their name and place of residence, that comments be kept as concise and non -repetitive as possible, that citizens address the entire Board and direct questions to the Mayor. MONTHLY REPORT 313.3 The Mayor introduced the City Manager's monthly report to the public and Board for the month of August. FINANCES 313.4 City Manager Pennington reported revenues continue to fall behind expenses. INSPECTION DIVISION 313.5 Pennington reported the Inspection Division had surpassed its 1989 goal to conduct 9,000 inspections by making over 11,997 inspections through August of 1989. He attributed this to the leadership of Inspection Superintendent Freeman Wood and Planning Management Director John Merrell. 313.6 Pennington reported we had a decrease in the absolute number of permits issued through August, but have witnessed a significant increase in dollar value over the last year, at $2.1 million more this year than realized at this time last year. September 19, 1989 OLD WIRE & TOWNSHIP INTERSECTION Pennington reported the project at the. intersection of Old Wire Road and Township Street had been completed, iexoept for the placement of traffic lights. He said this work would be done by our Traffic Division and projected completion by the end of this month. WAn'r:H LINE REPLACEMENTS Pennington reported we were moving ahead in's very rapid ,manner with water line replacements in the capital ,improvement' plan. -He said these were currently under engineering. contract. 314.1 314.2 YOUTH CENTER POOL RENOVATION Pennington reported the engineering work continues on the ,Youth Center pool 314.3 renovation project. He said the first report,was delivered on'schedule and the second report is expected soon. • ODOR CONTROL EQUIPMENy_T Pennington reported the installation of odor' control equipment continuing and completion was projected by the'endof the month. SEWER SYSTEM REHABILITATION was 314.4 Pennington reported we tried, with success, for the first time to insert a 314.5 line inside of an existing sewer line. - CAPITAL IMPROVEMENT; PROGRAM BOND ISSUE Pennington said he would be recommending a time schedule in October for a referendum in November, concerning the capital improvement program bond issue. He said proposals had been received from five bond counsel firms in the State and a committee would be formed (composed of members of the public, Board and staff) to make a selection. He said the staff was completing the 1990 capital improvement program to outline specifically what citizens would vote on in the referendum. He said included in this would be utilization of sales tax to retire the incinerator debt. USF&G LAWSUIT Pennington said that following completion of the wastewater treatment plant, the City was sued by USF&G, along with CH2M Hill, for about $10 million. He said, following 'mediation, a settlement was reached in the case. He said the final documents were still being drafted. Pennington said this did not wind up costing the City, that we would simply be expending the amount of money we retained on the project. He said the 314.6 314.; 314.! September 19, 1989 15.1 City would be dismissed from the suit, and this item would be on the next agenda. MUNICIPAL LEAGUE 15.2 Pennington reported the City of Fayetteville would host the Fall meeting of the Arkansas Municipal League on October 26 and 27. BUDGET OFFICE AWARD 15.3 Pennington said the City had set a goal for its Budget Office to win the Government Finance Officers Association distinguished budget preparation award He announced that Fayetteville and one other city in Arkansas were recipients of the award. FULBRIGHT CEREMONY 115.4 Pennington announced that Senator J. William Fulbright would be honored on the Fayetteville Square on Saturday, September 23 and he expressed hope that citizens would turn out for this honor. RECYCLING RALLY 315.5 Pennington announced that Saturday, September 23 had been set for the Recycling Rally sponsored by the City and some citizens' groups. He said the staff had done a fantastic job working with "Trashbusters." 315.6 Bob Kelly, Public Works Director, said Hal Morton, Solid Waste Management Administrator and Scott Smith, Recycling Coordinator, were representing the City's efforts on the project. He said we would collect aluminum, glass and newsprint. He said there would be three awards for recycling efforts by businesses and enterprises. He said there would be a live recycling "rap" by the duo "Loud and Clear." He said there would be an appearance by the "Trashbuster Man." He said hot air balloon rides would be available, wind permitting. He said there would be a ribbon cutting for the recycling drop off stations. He said the stations would be placed on parking lots in strategic locations around the city. He said educational information would be available. He said the rally would not be possible if it were not for the citizens that helped out, particularly the "Trashbusters." SEAT BELT RALLY 315.7 Director Vorsanger said that also on September 23 would be the Santa Fe Seat Belt Challenge at Evelyn Hills Shopping Center from 9:00 a.m. to 4:00 p.m. He said there would be a contest for the best -decorated bicycle and a drawing for a ten -speed bike. He said Mania Pinnell was chairing the committee and he encouraged everyone to drop off at the recycling rally and the seat belt rally as well. 1 1 CONSENT AGENDA September 19, 1989 • • 316.1 The Mayor introduced consideration of items -which may be:approved by motion, or contracts and leases which can be approved by resolution, and which may be grouped together and approved simultaneously under a "Consent Agenda." He said that any Director may request removal of an item from that agenda. Martin read the Consent Agenda, as follows:jj ' 316.2 A. Approval of minutes of* the September .5, 1989 regular Board meeting; • 316.3 B. A resolution authorizing approval of a budget adjustment to pay City Prosecutor Terry Jones.,and Manpower Temporary,Services for services provided to the City Attorney's Office; The City Manager recommends approval of the budget adjustment for $10,238.75, to be taken from Professional Services Account. 4 RESOLUTION NO. 82-89 BOOK APPEARS ON PAGE .. OF ORDINANCE AND RESOLUTION C. Award of bid for construction contract for Greenland and Farmington water system improvements; and approval of a budget adjustment; • The project consists of 'reinforcement of lines in certain areas of each town "for the purpose of providing fire protection. The City Manager recommends award to the lowest of three bidders, C. W. Construction Company of Fayetteville bidding $61,260. Because only $55,000 is budgeted the City Manager recommends approval of a budget adjustment of $7,000 to be taken from Contract Services Account which has funds available because of water line carryover projects. RESOLUTION NO. 83-89 APPEARS ON PAGE BOOK OF ORDINANCE AND RESOLUTION 316.5 D. Award of engineering contract for a water and sewer operations report; and approval of a -budget adjustment; The City issued water and sewer refunding bonds in 1985 to refund the then outstanding water and sewer revenue bonds. The ordinance which authorized the refunding issue requires that a report on the status of the water and sewer system's assets and compliance with the terms and provisions of the September 19, 1989 ordinance be periodically prepared by a consulting engineer. The first such study was completed in July of 1986 by Black and Veatch engineers of Kansas City, Missouri. The City requires that this study be repeated and completed by October 15, 1989. The City Manager and selection committee recommends award to Black and Veatch, proposing a not to -exceed fee of $15,000. Because the budget contains only $8,000, a budget adjustment is recommended for $7,000, to be taken from Professional Services Account because the computer mapping project came in under -budget. RESOLUTION NO. 84-89 BOOK APPEARS ON PAGE OF ORDINANCE AND RESOLUTION 1 317.1 E. Award of professional services contract for an update of the 317.2 Airport's 20 -year Master Plan; The City Manager and selection committee recommends award to Barnard Dunkelberg & Associates of Tulsa, Oklahoma, proposing a contract price of $61,111. The actual cost to the City would be $3,056, with 90% of the project being federally funded and 5% being funded by the State. RESOLUTION NO. 85-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK F. Award of professional services contract for airport engineering services through the year end 1991; Services would be limited to: land/easement acquisition, surface condition monitoring system, additional general aviation reap/helipads, and all items included in the multi- year grant project (see Item 2G). These projects are anticipated for 1990 and 1991 and do not involve current budgeted funds. In accordance with the new Competitive Selection of Professional Services policy, the City Manager and selection committee recommends award to McClelland Consulting Engineers. RESOLUTION NO. 86-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK 317.3 G. Acceptance of a multi-year grant offer for FAA airport improvement 317.4 projects; September 19, 1989 • The following items constitute the scope of the project: complete removal and lighting of obstructions; construct runway and safety area; emergency generator, proximity suits, air packs, and first responder kits for ARFF truck; install access road lighting; and security fence. Project costs • for the 1989 through 1991 period total $1,397,464. In 1989, the project expense will be $561,154, with the City's costs to be $28,057. The entire project is to be 90% federally funded and 5% funded by the State Aeronautics Commission. The City Manager recommends acceptance of the grant and approval of a budget adjustment for $561,154: RESOLUTION NO. 87-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK 318.1 H. Acceptance of a grant offer from the FAA acquisition for the Fayetteville airport; for land and easement This project will assist in the ongoing obstruction lighting and removal work at the Airport and will allow the City to acquire land and easements for the approaches at the Airport. Project cost totals $94,300, with the City's cost to be 5%, or $4,715. The project is to be 90% federally funded and 5% funded by the State Aeronautics Commission. RESOLUTION NO. 88-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK 318.2 I. A resolution authorizing the City Manager to apply for federal funds to improve recreational facilities in the City; The resolution would allow the City to make application through the Arkansas Department of Parks and Tourism to the National Park Service, U. S. Department of the Interior, for $50,000 to develop recreational facilities for Gulley Park RESOLUTION NO. 89-89 APPEARS ON PAGE -OF ORDINANCE AND RESOLUTION BOOB 318.3 J. Authorization for computerized existing contract with Aerial Arts Center Impact Area; and a adjustment; mapping services, under the City's Data Service, Inc., for the Walton request for approval of a budget This year all of the aerial photography and ground controls necessary to begin the development of a computerized mapping September 19, 1989 system were completed, under a contract with Aerial Data Service, Inc., which was approved in November of 1988. Although the computerized mapping phase of the project had been deferred until 1990, the staff now recommends a portion of town be digitized this year - specifically, the Walton Arts Center Impact Area covering approximately one square mile of town. A budget adjustment of $15,500 is recommended to cover the cost, to be taken from funds for a water loss study which came in under -budget. RESOLUTION NO. APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK The Mayor asked if any Director wished to remove an item from the Consent Agenda. Director Marinoni requested removal of item "J". 319.1 It was moved by Lancaster and seconded by Marinoni to approve the Consent Agenda, with the exception of item "J". Upon roll call, the motion passed, 7-0. CO!4P[flERSZED MAPPING The Mayor introduced consideration of Item "J" on the Consent Agenda. It was moved by Kelley and seconded by Spivey to approve the request. In answer to a question from Director Marinoni, Public Works Director Kelly said the original contract price included the computerization of the aerial photos. He explained a base price was charged for ground control and aerial photography. He said a unit price is charged for each square mile bid, with different costs for urban, suburban and rural. He said the firm proposed to digitize the urban downtown area at a suburban price, or about a $5,000 savings. Marinoni asked if the $15,500 budget adjustment was part of the original contract price. Kelly said it was part of the original bid documents. He said none of the digitizing was awarded when the original contract was awarded, just the ground control and aerial photography portion. Kelly said there were 42 square mile of city limits, but the urban area was less than six miles. He said this was an effort to get the Walton Arts Center area digitized. Pennington said when the project was brought before the Board originally costs were extremely high, and it was decided it would be economically wiser to do the work in phases. 319.2 3 31 .4 319.5 319.6 319.E 1 1 September 19, 1989 Marinoni said at the last Board meeting Al Raby was awarded a contract for planning for the Dickson Street Impact Area. He asked if the $15,500 expense would duplicate any of those services. Kelly said this digitizing would be done for what is there, while Raby.'s planning.., will be for what should be there. '; 320.1 In answer to a question from the Mayor,;Keliy explained that "digitizing" was computer mapping. He said the aerial photographs picked up location of all the city's water and sewer lines on the maps. 320.2 Upon roll call, the motion passed, RESOLUTION NO. 90-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK REZONING 4 4 320.3 The Mayor introduced an ordinance rezoning 5 acres located at 1643, 1649 and 1657 Huntsville Road. He said the petitioner, Bryan Abernathy, requested rezoning from R-0 "Residential Office" -to C-1 "Neighborhood Commercial." 320.4 1 The Mayor told the Board the petition was considered in a public hearing before the Planning Commission on September 11, 1989. He said the Planning Management Director recommended approval of the rezoning, reporting the following to the Commission: Dr. Abernathy proposes to construct a medical clinic on the property and to relocate his office there. He would also like permission to construct a pharmacy there and he therefore needs a rezoning to C-1 since pharmacies are not allowed in the R-0 zone. Based on our earlier support of the rezoning of this property and based on the fact that no pharmacies are located in proximity to the property the staff recommends approval of the rezoning. 320.5 The Mayor saki at the hearing it was pointed out that the portion of the land where the pharmacy would be located encompassed only three acres of the total five acres and the Planning Management Director amended his recommendation to rezone only three acres to C-1. He told the Board no public opposition was expressed at the hearing, and the Commission recommended rezoning only three acres by a vote of 7-0. 320.6 The City Attorney read the ordinance for the first time. Director Kelley, seconded by Marinoni, moved to suspend the rules and place the ordinance on its second reading. Upon roll call, the motion passed, 7-0. The ordinance was read for the second time. Director Kelley, seconded,by Marinoni, made a motion to further suspend the rules and place the ordinance on its third and final reading. Upon roll call, the motion passed, 7-0. The ordinance was read for the third time. September 19, 1989 The Mayor asked if anyone present wished to speak against the ordinance. No public opposition was expressed. Director Lancaster remarked that if something happens to this property and the drugstore is not built, there will be a request before the Board to down -zone the property. 32 321.2 Upon roll call, the ordinance passed, 7-0. 321.3 ORDINANCE NO. 3455 APPEARS ON PAGE /S % OF ORDINANCE AND RESOLUTION BOOK X X V FINANCIAL REPORT Dan Schultz, partner with the Coopers and Lybrand firm, reported on the City's Comprehensive Annual Financial Report (CAFR). In answer to a question from Director Vorsanger, Schultz said the fact that the City had a reduction of almost $4 million in intergovernmental revenues (State turnback funds and federal grant funds) was not due to a drastic reduction in turnback funds, but was because in 1987 we spent significant amounts of federal funds to construct the wastewater treatment plant. Vorsanger said the report noted the City earned $4,500,000 of interest income on all investments for the year ended December 31, 1988, and about $1,800,000 went into the General Fund. He asked where the rest of the money went. Assistant City Manager Linebaugh said part of it was capital funds which went into the construction fund. Vorsanger congratulated the staff for earning an extra $1,800,000 on money we are holding. In answer to a question from Vorsanger, Linebaugh said "Loss on Abandonment of $9,155,000" referred to the incinerator. The City Manager said the report was available to the public to review in the City Manager's Office. Schultz reported on the City's Supplemental Report on funds budgeted which he said was produced because of the level of detail required by the Certificate of Achievement Program Schultz reported on the City's Internal Control and Grant Compliance Report required by the federal government. Schultz said certain conditions which required attention by the City were noted in the report and the City had responded in writing to this. [These points were reviewed by Schultz and were contained in the agenda for this meeting.] In response to concerns expressed by Coopers and Lybrand that the City's accounting software was not performing the way that it should, Director Spivey asked how the City could respond to this problem in the event it does 321.4 321.5 321 321.7 321.8 321.9 321.11 32 September 19, 1989 not have the "source code" for theasoftware. Schultz said the staff was evaluating the situation and would'be'making a. recommendation to the Board. 322.1 Vorsanger pointed out that almost 42% of our revenue comes from sales tax, and only 7% comes from property taxes, and wehave earned more interest on our funds than we have collected in property tax. He advised the City would have to look for other avenues of revenue., . 322.2 In answer to a question from the Mayor, Schultz said his firm received total cooperation from the staff in the audit procedure. He said his firm thought the people running the City were among,the'best they dealt•with. There were no questions from the public. +d 7 PROPERTY CLEANUP/1300 PETTIGREW • 322.3 The Mayor introduced an ordinance ordering the -abatementof unsightly conditions and the razing and removal of an unsafe structure located in the 1300 block of Pettigrew Street; left 6n second reading on September 5. 322.4 It was moved by Marinoni and seconded by Martin to suspend the rules and place the ordinance on its third reading. The ordinance was read for the third time. ' The Mayor reported the Board had considered this item over the past six weeks, had viewed photos of the property and toured the site. Director Green asked if the owner had contacted the City or if any change had occurred since the last meeting. Planning Management Director Merrell reported no changes had been made and no permits had been obtained. 322.6 Frank Huff spoke on behalf of the owner, Eoff and Company. He said they had started doing work on the property and would have done more if it hadn't rained every day of the last week. He said debris was still on the property, they had cut down shrubbery and trees and were in the process of trying to locate someone to mow the area. He said they would remove appliances. He said they had a list of ten houses which they must bring up to Code, all of which he said they were trying to work on at the same time. He asked the Board to bear with the owner and said they would get everything up to standards. 322.7 Director Lancaster pointed out the first violation notice on the property was dated March 23. Huff said they would have someone out every day this week working on the property. 322.8 The Mayor asked if the property would be cleared or would the building be rehabilitated. Huff said the owner planned to reconstruct the building but, if it costs too much, they will tear it down September 19, 1989 Director Green asked how much time Huff estimated it would take to clean up 323 the Pettigrew property. Huff said if the building is redone it would take 111 at least 90 days He said the other cleanup wouldn't take that long. In answer to a question from the Mayor, Merrell explained if the ordinance were passed, the owner would have thirty additional days before the structure is razed. Director Kelley asked what the staff would do if the ordinance is passed but if significant improvements are made within the next thirty days Merrell said if all the cleanup is not completed within thirty days, the City will hire contractors to do the work. 323.2 323.3 Upon roll call, the ordinance passed, 7-0. 323.4 ORDINANCE NO. 3456 APPEARS ON PAGE /51 OF ORDINANCE AND RESOLUTION BOOK XX✓ AIR MUSEUM FUNDING The Mayor introduced a request from the Arkansas Air Museum Board of 323.5 Directors for $25,000 for funding salaries and utility costs for the Air Museum at the Fayetteville Airport. He said the Board was requesting an annual maximum amount of $25,000 to cover salary expense for the Museum Director and utility costs incurred in the hangar at the Airport. He said that, under the terms of the ten-year lease between the City and the museum, the Museum is currently responsible for paying all utility costs. He said that lease was entered into in March of 1987 with options to extend for two additional ten-year terms. It was moved by Green and seconded by Vorsanger to approve the request. The City Manager recommended that any new programs or contributions to non - City operations should be reviewed for precedent in mid -year because many requests for funding come before the Board in mid -year that were not considered at budget time. He recommended the Board not approve the request but consider it instead for the 1990 budget, so the staff can review the long-term effects. 323.6 323.7 Director Green said the museum seemed to attract a lot of tourists to the 323.8 City and he thought there was a benefit from that standpoint. In answer to a question from Director Vorsanger, Assistant City Manager Linebaugh said the museum was in the Parks Division budget. Vorsanger asked if any funds were available in either the Parks or Airport budgets. He said he thought in the future we should budget for unforeseen requests. Vorsanger asked if the Advertising and Promotion Commission could be asked for assistance. Green said he thought a request would come before the 323.9 September 19, 1989 • Commission for funding from the Museum to assist them in funding of printing costs for some of the museum's brochures. 1 324.2 Green said the Museum wanted the museum's Director to be ,a City employee. He said that might be an easier way to cushion the increase. Martin explained that, when the Museum first opened, the City was to provide the facility and the project was to be self-sustaining and pay its own operating expenses. He said the concept:was that there would be admission charges to the museum. He said the museum has been a' success and said he was worried that, if the museum began:charging admission, it might suppress some of the visits. He said he can see why the. museum now is requesting help from the City and said he would favor approving the request in the form of additional "seed money" with the hope that, .as they become more successful, they could become totally self sufficient. He said in a year or two he would probably be supporting:theMuseum looking for ways to be self- sustaining as possible. 324.3 Director Marinoni suggested the Board consider granting them a pro -rated portion of the $25,000, giving thenisroughly $6,000 for the balance of 1989, and'consider the full $25,000 for 1990. 324.4 Linebaugh said the museum is actually requesting $1,500 per month for the employee and $500 per month for the utilities through December, and the 111.5 museum will present a request for the 1990 budget. Art Hollenbeck, President of the Museum, introduced Museum Board members present in the audience. He said the museum averaged 1200 visitors per month in June, July and August, 20% above attendance at the Shiloh Museum. He said_over 40 tours had gone through the museum. He said they received a grant of $4,000 from Arkansas Museum Services to be used on a matching basis for insurance and education. He said they will try to raise $500,000 from the community which would collect interest and be a permanentlfund from which the Museum would operate. `J 324.6 Hollenbeck said they really weren't asking for a lump sum, but would like it pro -rated from now to the end of the year. He said they were asking to have their Museum Director made a City employee, with utility costs billed directly to the City. 324.7 Director Kelley asked if there was any problem in making the Museum Director a City employee. City Manager Pennington said it would be an advantage for the employee and the Society. He said he had concerns, noting he would not recommend it at this time. He said he wanted to review the overall City needs. 324.8 Hollenbeck said the Museum Board would be anxious to work with City staff in writing a job description but said the Museum Board would like to be his immediate supervisor. He said the Airport Division might be a more natural spot for the Museum to be than in the Parks -Division. Hollenbeck said they would be willing to work it out with the staff. September 19, 1989 Marinoni asked what additional cost there would be to the City, beyond salary, if the Museum Director were to become a City employee. Pennington said there would be an additional 20% to 25%. Jim McDonald, Air Museum Board Finance Committee Chairman, said they would work with whatever the staff recommended. He said when they recommended $15,000 for salary, they had no idea of the City's pay scale, and intended for $15,000 to be a maximum amount. He said with utilities averaging $500 per month, the maximum amount needed would actually be $21,000 to be considered for the 1990 budget. He said they were still requesting assistance for the remainder of this year. Spivey agreed with Marinoni's suggestion for pro -rating the grant for the remainder of the year, stating that would give the staff a chance to decide whether the Museum Director should be a City employee, and a chance to work out any details. 325 325.2 325.3 It was moved by Green and seconded by Vorsanger to amend their motion and 325.4 second to approve a request for a pro -rated amount of funds for the remainder of the year. Director Kelley asked if this was strictly a grant to the Air Museum. 325.5 Martin said it was to pro -rate a $25,000 annual grant to the Air Museum for staff salary and benefits and for utility expenditures. Upon roll call, the motion passed, 7-0. Linebaugh recommended the Board consider a budget adjustment for $7,000, to come from Unreserved fund Balance. It was so moved by Kelley and seconded by Lancaster. Upon roll call, the motion passed, 7-0. jA. `/ j9 CEMETERY FUNDING REQUEST 325.6 The Mayor introduced a request from the Regional National Cemetery 325.7 Improvement Corporation for $25,000 to purchase land to expand the National Cemetery in Fayetteville. It was moved by Vorsanger and seconded by Green to approve the request. 325.8 The City Manager recommended the request not be approved at this time and strongly recommended the request be reviewed for precedent, because the request came at mid -year. He said, if the Board decides to approve the request, one option is that funds could be taken from Unreserved Fund Balance, or it can be added to the issues to be included in the referendum, so that the funds can be taken from the bond fund rather than from the City's cash reserves, or the Board could wait until the beginning of next year. 325.9 1 II September i9, 1989 • • • Director Vorsanger said he didn't think' there was a pressing need to purchase the property before the year end and suggested the staff be asked to consider this in next year's budget or perhaps consider granting $12,500 in 1990 and $12,500 in 1991. .He said he didn't think we should ask people to vote on this type of expenditure. 326.2 Vorsanger said the intent of his motion_;was that the 'staff would work with the Cemetery Corporation to phase the.;funding in seme.logical manner, if it weren't needed immediately. ? . 6 326.3 Elvie Heiney, President of the Corporation, displayed a plat which indicated the location of the cemetery, and' surrounding property on which the corporation holds options to purchase. He said the additional purchases would give the cemetery at least 4,500 more burial spaces. 326.4 Leland Hamilton, member of the audience, said he was a veteran and asked if there would be any preference,{ or, priority, given to veterans of Fayetteville. Heiney said the cemetery was not for Fayetteville alone or for Northwest Arkansas alone, but was for any veteran with an honorable discharge. He said they had targeted six counties in northwest Arkansas to request grants or contributions, said in the six -county area approximately 13,000 living in County. He said they were Fayetteville. based on the figure of $5 per veteran. He there were approximately 33,000 veterans, Washington County and 11,500 in Benton not requesting all the needed funds from .5 Joe Robson said there were only three national cemeteries in the State and there were people coming to Fayetteville to visit the national cemetery. He said he -thought we should support it. 326.6 Director Marinoni asked if the intent of the motion was to grant 112,500 for 1990. Vorsanger said that was fine, if that was the best that could be done, noting that an additional $12,500 would be granted in 1991. He said that should be left up to the staff. Martin said he understood we were pledging $25,000, to be drawn down as the cemetery needs it. Martin asked if that was the intent of the motion. Vorsanger said that was fine. Marinoni, with Vorsanger agreeing, said he hoped the money would be forthcoming before the options run out. 326.7 Upon roll call, the motion passed, 7-0. APPOINTMENTS 326.8 Director Kelley, Chairman of the Board Nominating Committee, of the appointments of Stephen Brandeis and Barry Fink to Advisory Board. The motion was seconded by Lancaster. Upon motion passed, 7-0. moved approval the Electrical roll call, the September 19, 1989 INDUSTRIAL PARK PURCHASE The Mayor introduced consideration of a resolution authorizing approval of an Option and Right To Exchange Agreement with the Fayetteville Development Foundation which would allow the City to purchase land in the Industrial Park. He explained the agreement would allow the City to purchase all parcels of land in the Industrial Park West and in the Fayetteville Industrial Park, currently owned by the Fayetteville Development Foundation. He said the agreement provided for the City to have an exclusive option to buy all or part of the land over the four-year period. He said that, under the Agreement, the Foundation would not sell the land to any other party. It was moved by Kelley and seconded by Marinoni to approve the resolution. The Mayor said that he was a Director of First National Bank which owns bonds on the Industrial Park and this could be construed to be a conflict of interest. He said he would be abstaining from any discussion or vote. It was clarified that the agreement in its tentative form indicated a total 163.55 acres while a corrected version of the agreement contains the correct total of 120.90 acres. Delmar Embry, speaking from the audience, asked what the Fayetteville Development Foundation was. Linebaugh was it was formed years ago to take on the project of buying the Industrial Park and its Board was made up at that time of Directors of the Chamber of Conmierce. The Mayor asked who appointed new Directors when a Directors' terms expire on the Foundation Board. Director Vorsanger said one new Director is appointed each year, for a term which he thought lasted five, six or seven years. He said past Chairmen of the Chamber Board are appointed to serve as directors on the Foundation Board. Dobry asked if the property currently owned by the FDF was purchased by a bond issue. Linebaugh said the FDF went through a bond issue to raise the money but it was not connected with the City. He said it was industrial revenue bond financing. 327. 1 327.2 327.3 327.4 327.5 327.6 Embry asked who the current bondholders were. Martin said that First 327.7 National Bank owns some the bonds and thought other banks in the community and individual corporations and perhaps individual citizens own some of the bonds. Dobry asked which property would be involved in the acre -by -acre exchange provision. Linebaugh said any of the property in the Park could be involved. Dobry asked if a value by value approach would be more prudent. Linebaugh said it was felt, if we were able to sell land to an industry, we would need to exchange some property and the City is limited in the value of property it currently owns. He said in his opinion this is to the advantage of the City. Dobry asked why the City should buy more property when that 327.8 1 September 19, 1989 • which it owns has not been marketed. Linebaugh said in the past the City hasn't been involved in the marketing of the property in the Park, that it was done by the FDF. He said the plan was for the City to take this over. He said the City felt it could improve the job ,which has been done in the past. Embry said he didn't think the City.. should engage in large scale industrial development, considering;it, takes a ten-year plan to develop a 20 -acre recreational plot. ..t . Bill Isaacs, Fayetteville resident_,,said he recalled a debt is still due on the FDF owned property, about $2.2 million. Linebaugh,said it was in that vicinity. Isaacs said, having some:knowledge of the -worth of the property, he thought $18,000 (or $14,000, or$8,000) an acre seemed like way too much. He said he thought it was a good idea for the City to get the property but thought it was a bad idea to pay $18,000 per acre. , Robert Reus, Fayetteville resident, asked what the FDF paid for the land and who would receive any profit from the sale of the land. Linebaugh said he did not know what they paid for the land and said, if any profits were earned, they would go to the FDF. Richard Shewmaker, City Economic Development Coordinator, said the FDF was a 501C3 corporation which was prohibited from making profits. He said the property would be purchased at cost, however, he said the FDF's bond issue included capitalized interest because they were unable to sell property. He said they were also paying property taxes to the school system, so those costs each year would be added to the value of the land. Linebaugh said this would also.dnclude improvements which were made to the property. He said the City performed the work and the FDF paid for the cost of improvements which were made Joe Robson, Fayetteville resident, asked if the FDF had incurred any other debts other than the $2.2 million, and were we bailing them out of another debt or bad investment. Linebaugh said he couldn't answer that question. Martin asked if Linebaugh knew whether the FDF engaged in other business. Linebaugh said he understood the.FDF was formed for one purpose. Robson asked if the land was purchased at the same time the City bought the land for the original industrial park in 1969. Shewmaker said the original phase of the Park did occur in about 1969. City Manager Pennington said FDF incorporated in May of 1981 although the Secretary of State did not recognize them until 1984. Shewmaker said he thought it was in 1984 when FDF borrowed the money. Shewmaker said it was the City who purchased the original land for the Park in 1969. Linebaugh said in 1981, when the FDF incorporated, the new part of the Park was bought. He said that is the part the City is intending to purchase. He explained the original part of the Park was purchased by the City. Robson said the original part of the Park is still under-utilized, with about 2/3 of it being vacant. He said the purchase would be made with dedicated sales tax which voters approved on the basis it would be used for capital improvements and the school system. Linebaugh responded that the capital improvement plan approved by the voters included the purchase of the Industrial Park and other industrial improvements. He said there was a negotiation in price and, at the same 328.1 328.2 328.: '29.1 September 19, 1989 time, it was considered that the FDF was formed to do industrial development. Vorsanger said he was a Director of a financial institution holding some of the bonds but he would not abstain from voting since he did not have a direct interest. He said the debt on the land as of today was about $15,800 per acre. He said the plan is to pay the debt over a four-year period. He said if you include interest charged by the banks over the period, it comes to about $18,100 per acre. He said the interest rate today is 7.5%. He said the City would like to buy the Industrial Park and assume the debt for many reasons: (1) It will help our economic development. (He noted that the cities of Rogers and Springdale own their industrial parks); (2) So the City can negotiate with prospective developers and not the FDF. (He said it was because we couldn't offer Superior Industries the additional land they needed in Fayetteville's Industrial Park that they built their new plant in Rogers); (3) So the City can better maintain and develop the land; (4) It will provide us with a more varied economy and bring better jobs to the community. He said because our unemployment rate is low we were not eligible for grants; 5) It will help our property tax base; 6) The City composting operation could be located in the Industrial Park; and 7) This is a natural step to do what the people asked when they voted for the sales tax. 329.2 Shell Spivey said he was employed by a bank which owns some of the bonds and would be abstaining from the vote. He said he was very involved with the computer drive for the school system. He said if Fayetteville had had the success over the last five or ten years which Rogers has had, the school system would already have computers. He said this is a direct result of our lack of economic development. He said if the industrial park went into default, it will be a "nail in the lid on our coffin" as far as trying to develop the City's economy. 329.3 Ed Fryer, School Board member, told the Board he proposal was an opportunity to initiate another program that can result in more economic development which will benefit the schools. He said it would provide the City with another tool to be aggressive and effective. 329.4 Bill Isaacs said he believed the bondholders should be paid, but thought they should have been paid a long time ago. He said he understood the debt had been in default for a number of years. He said if the debt is due, it should be paid and not disguised with "an $18,000 an acre deal." Correcting Director Vorsanger, Isaacs said Rogers did not own the property Superior Industries bought, it was owned by the Rogers Industrial Development Corporation. He said the industry did not go to Rogers because they couldn't get property in Fayetteville, but bought the Rogers property for completely different reasons. He said "let's not say this property is worth $18,100 an acre because every one of you know it's not." 329.5 Peter Tooker, Fayetteville resident, said this was a bail-out for one 1 1 September 19, 1989 Fayetteville bank represented by half. the members of the Board. He said he didn't think the City should be intthe business of bailing out any business. t 330.1 Leland Hamilton, Fayetteville resident -,-asked how much money the City had on hand not committed at this time. Linebaugh said he couldn't answer that question. Hamilton said there was $28 million in last year's budget. Hamilton said, if $500,000 is available to make the first payment on the land, he wondered how much money could .be given to the, schools for the computer lab. Linebaugh said there.was nowhere near $28 million available in excess funds. He said some, excess funds shown on the financial statements is committed. He said the actual amount of uncommitted funds is well under $1 million. He said the $500,000 would come from sales tax funds, and not from surplus funds: Hamilton asked why we couldn't take $100,000 of the money and give it to the schools to buy the computer lab, and stretch out -the industrial park deal another year. 330.2 Vorsanger said he wondered what Superior Industries paid for the land they bought in Rogers. Isaacs said that was a matter public record but he didn't recall the specifics. He said it was a lot less than $18,100 an acre. 330.3 Director Green said the main point was whether or not the City is capable of gaining control of the project. He said there was no way the property could be marketed effectively in its present condition. 11.4 Director Lancaster said the first two industrial parks owned by the City failed. He said after the Industrial Park Commission was formed, the City loaned them $300,000 of water and sewer funds to get the Park going. He said the federal government gave a grant of about $400,000 to the City for the Park which was used for installing water and sewer lines to the Park. He said the Industrial Development Foundation was created to try to expand the Park and fill in the spots that the City didn't own. He said the City built streets and installed water lines paid for by the Foundation. 330.5 Upon roll call, the motion passed, 5-0-2, Directors Martin and Spivey abstaining. RESOLUTION NO. 93-89 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK SETTLEMENT PROPOSAL 330.6 The Mayor reported the City Manager indicated the documents relating to the proposed settlement regarding USF&G vs. the City and CH2M Hill were not yet in the City's possession. He said the staff asked this be postponed until the next meeting. 1 r 331.1 OTHER BUSINESS September 19, 1989 ARTS CENTER STAGE LIGHTING The City Manager introduced consideration of the award of bid for stage lighting equipment for the Walton Arts Center to Olesen Company. He said it was determined after meetings between City and University staff that it would be best for the City to purchase the equipment and for the University to reimburse the City. He said this came about after the City decided to purchase the property for the parking. 331.2 Marinoni asked how stage lighting could be installed without a building. Linebaugh said the bid was only for the equipment, not for installation. He said the contract is with the architect, because Mott Mobley is charged with equipping the building. He said this was reviewed by the Arts Center Council and the equipment would be stored until it can be installed. 331.3 Green asked why it was necessary to purchase and store the equipment now. Linebaugh said it was necessary because of the bond issue and the necessity to spend money as quickly as possible. 331.4 It was moved by Marinoni and seconded by Vorsanger to award the bid as recommended. Upon roll call, the motion passed, 7-0. LAND PURCHASE ON ROCK STREET 331.5 The City Manager reported the City was successful in bidding today to acquire property on Rock Street for $57,500. 331.6 HUMANE SOCIETY CONSTMUCTION CONTRACT In reference to a memo to the Board from City Attorney Rose dated September 19, 1989, Rose reported the issue was whether or not the $150,000 they intended to give to the Humane Society to construct an Animal Shelter ought to have a string attached to it - that they comply with competitive bidding standards used by the City. Rose said the Society's attorney, Truman Yancey, advises that the Society intends to award the construction bid on September 28 unless the Board instructs differently. 331.7 Rose advised that at best, the City would be open to criticism that it is circumventing the competitive bidding law and, at worst, could incur some legal responsibility from other bidders who would have bid on the contract. He said the law was ambiguous and he advised the better practice would be to require the competitive bidding. He told the Board they had the right to waive the requirements. September 19, 1989 In answer to a question from Marinoni; Linebaugh said,the facility would be jointly owned by the City and the Society. 1 ' The Mayor said it seemed to him a matter for the staff to advise the Humane Sobiety of the City's requirements. _ 332.1 332.2 Lancaster said, as long as City funding will be used for the project, he 332.3 thought it should be competitively,bid. Vorsanger said he didn't think we had any choice but to bid the project. 332.4 ARTS CENTER PARKING. Robert Reynolds, land and business owner on Dickson Street, said in the last three weeks he had heard that an Arts Center parking lot will be built on the "old ice plant property." He said business owners in the area had been told by the District originally that they would have a parking lot behind their businesses where he said was an old warehouse which was a fire hazard. He said a parking lot where the old ice plant was will not help anyone in the 600 block. He said they needed the warehouse behind their businesses destroyed and some temporary parking installed when the Arts Center project begins. Public Works Director Kelly said the immediate time frame for parking lot construction was November 15. He said it was identified that properties on West and Dickson were most likely to be used for achieving that deadline. He said that would only be parking for about 200 cars, and there will be additional 300 car parking. He said the intention will be to have parking on lots—that have always been designated. Reynolds said he understood the first phase of the parking would be at the corner of Dickson and West, facing George's Lounge. He said there was talk of making a park out of "the hole" and using money for that for the first phase. He said that it was not fair to shop owners to do that for the first phase. Kelly said he didn't think the City had good communication to the public and Dickson Street merchants. Reynolds said he had left messages with both Pennington and Kelly to call him this week and neither of them had returned his call. Kelly apologized and said there would be nothing constructed on that corner. He said the only work to be done in preparation for parking will mostly be on the McBride property. He said a park would not be built first. ADJOURNMENT The meeting adjourned at 10:55 p.m. • 332.5 332.6 332.7