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HomeMy WebLinkAbout05/19/2014 Work SessionCity of Springfield Work Session Meeting MINUTES OF THE WORK SESSION MEETING OF THE SPRINGFIELD CITY COUNCIL HELD MONDAY MAY 19, 2014 The City of Springfield Council met in a work session in the Jesse Maine Meeting Room, 225 Fifth Street, Springfield, Oregon, on Monday May 19, 2014 at 5:30 p.m., with Mayor Lundberg presiding. ATTENDANCE Present were Mayor Lundberg and Councilors VanGordon, Moore, Ralston, Woodrow and Brew. Also present were City Manager Gino Grimaldi, Assistant City Manager Jeff Towery, City Attorney Mary Bridget Smith, Administrative Assistant Amy Jo Ripka and members of the staff. Councilor Wylie was absent (excused). 1. Transportation System Systems Development Charge (SDC) Methodology Update — Receive Citizen's Advisory Committee and Staff Recommendations. Deputy Development and Public Works Director, Anette Spickard, presented the staff report on this item. The Council appointed the Citizen Advisory Committee (CAC) in September 2013 and assigned specific policy questions for the CAC to review and provide recommendations to Council for the methodology update. Based on Council direction at this work session staff will incorporate any or all of the recommendations into the draft methodology and bring back to Council for review and discussion of the resulting rate structure. Staff will then issue the statutorily required public notices announcing the availability of the methodology for review. Ms. Spickard introduced member of the CAC who were present at the meeting: Planning Commission Tim Vohs and Leonard Tarantola. She also introduced Deb Galardi who is the consultant for this project who will be available to answer questions. The CAC worked very hard over six months and engaged in good discussion in order to bring their recommendations to the Council. Councilor Brew also served on the committee. Ms. Spickard said the CAC's report was included in the agenda packet as Attachment 2. The staff agreed with all of the CAC recommendations except for Issue 7 regarding the financing of SDCs for commercial and industrial developers. The CAC recommends the City put together a financing program where the developer would pay the SDC to the City as a loan with an interest rate over a period of time, with a lien on the property. Staff currently has a method of working out the payment plan with commercial and industrial developers and recommends continuing with that program. They can make any potential revisions to the down payment if needed. She asked Council for discussion and direction on that topic. Councilor Moore asked how the current financing program worked. Civil Engineer Clayton McEachern said commercial properties paid the first $10,000 of the assessment, with the balance due at occupancy. That system was created to reduce the amount of City of Springfield Council Work Session Minutes May 19, 2014 Page 2 construction loans the developer would have to pay interest or bigger projects that may take several months to build. Ms. Spickard said for residential property, the City is required by law to allow people to finance it over ten years. That was the basis the CAC used in their recommendation for the commercial and industrial development. There are complications with commercial and industrial properties that don't exist with residential. Many developers didn't want to have a lien on their property. Some creative administrative infrastructure would be needed to track the loans, which sometimes include multiple `owners' when property is leased or sold. Councilor Woodrow noted the problems in collection for commercial and industrial development that might not last, including liens on the property. She agreed it is very complicated. She asked about how many people it might take to manage that type of loan program. Ms. Spickard said it is a small amount. Councilor Woodrow said she is comfortable not having the loan program other than what was already in place due to the administrative work involved. She supported staff's recommendation. Mr. Grimaldi said banks are reluctant to give up their first position, putting the City later in the collection process. Councilor VanGordon agrees that simple is better. The total benefit to the community would not outweigh the amount of work needed by staff to administer the loan program. He asked if the CAC will be meeting again. Ms. Spickard said the CAC is done meeting and have accomplished the task they were charged with. Councilor VanGordon said he was interested in looking at the program we have in place now to see if it can be made better with some small changes. Ms. Spickard said staff will be happy to do that. That component didn't affect the rates for the methodology so that work can be done parallel with the work on the methodology. Councilor Moore asked if this is for new development only. Ms. Spickard said new development paid the SDCs. Councilor Moore asked if the businesses along Franklin Boulevard would incur SDC charges. Ms. Spickard said only if a building permit is issued or a change of use that would trigger an SDC charge. Councilor Moore asked if the City changing Franklin Boulevard would trigger such a change. Ms. Spickard said it will not. If a developer proposes a development in the Glenwood area in compliance with the Glenwood Refinement Plan, the Springfield Economic Development Agency (SEDA) is paying the SDCs. Councilor Moore said she would agree not to change the current program City of Springfield Council Work Session Minutes May 19, 2014 Page 3 Mayor Lundberg said in comparing Eugene and Springfield SDCs, it appears Springfield charges more. She asked what it was that gave that appearance. Mr. Grimaldi said it may be the site plan process. Staff is preparing a report showing the difference between Eugene and Springfield. The Development Advisory Committee reviewed that and was comfortable with the way the City is doing it, but noted that the City needs to work on how it is explained to the developers. Springfield does more of the work up front so the fees are frontloaded, but it created some time efficiencies on the back end. The total fees are similar, but not exact. Mayor Lundberg said she wasn't sure if that tied into the SDCs. Mr. Grimaldi said when the developer comes to the counter, they look at both so they are related Community Development Manager John Tamulonis said staff provides an estimate of the SDCs when the developer comes to the City so they have an idea at the beginning what they will pay. Eugene does not estimate SDCs. Mayor Lundberg said they are addressing this to relay that it doesn't cost more in Springfield, it's just a different way of doing things. Mr. Grimaldi said they felt it was more effective for the developer and the development community members they have talked to agree. It also reduces the number of appeals. Ms. Spickard said staff would like Council input on two other issues that impact the overall SDC rate. The first is changing the assumption for how much external funding is going to be assumed for all of our local roadway projects. In the current methodology, the City assumes 60% of those projects will be paid by other funding such as grants or assessments. In looking at the current history of projects, they found it is coming in closer to 70% on average. If they make that change in the methodology, it will reduce the rate. Councilor Woodrow asked if they expected the 70% average to hold. She asked what the affect will be if that percentage doesn't hold. Ms. Spickard said based on the analysis in looking at the individual projects, the percentage came to 70 %, although it's hard to predict if that will hold. The second issue is regarding allocations of bicycle /pedestrian improvements to growth. The first method is in the current methodology which assumes an across the board percentage share for all of those projects that will be charged to developers. In the current methodology, it is 30 %. Based on traffic model projections out twenty years, that model estimates it is now 20% growth and trip rates. if they applied 20% to the bike projects, that percentage will be the developer's share. The other method used by many cities for bicycle and pedestrian projects is to look at how many lane miles of bike paths per capita are in the city and how much you will have in twenty years. They use that to calculate how much is attributable to growth rather than existing. If they change it to just using the growth and auto rate assumption of 20% it will decrease the SDC charge. If they move to the level of service approach, it will have an upward impact on the SDC, but will provide the funding needed for bicycle and pedestrian projects. The latter is the method more commonly being used and is similar to what the parks use to determine their SDC rates. Staff is proposing the level of service method. Councilor Moore asked if Willamalane used that method. Yes. City of Springfield Council Work Session Minutes May 19, 2014 Page 4 Ms. Spickard said they did double check to make sure there were no Willamalane projects on the City's list so they aren't doubling up on SDCs. Councilor VanGordon asked if they knew what financial impact it will be going to the level of service method. Ms. Spickard said bicycle /pedestrian projects are a smaller piece of the Transportation System Plan (TSP) so will have a very small effect on the overall rate. Using this method will result in more of the bicycle /pedestrian projects being considered related to growth, putting more funding from the developer side into that fund. Councilor VanGordon said conceptually he likes the level of service method, but is concerned with the impact it might have on the SDCs. Ms. Galardi said based on preliminary figures, the level of service method could result in 50 -70% of bicycle /pedestrian projects that are growth eligible. Because it is a smaller portion of the overall fee, it would be more of an 8 -12% impact compared to the 20% used currently. Councilor VanGordon asked what an average Transportation SDC is for development. Ms. Galardi said for residential, it is about $2500. This is one policy issue among several. The SDC based on the previous topic of external funding would also have an impact. The City has a new project list which will also have an impact. It is hard to break it out to determine the magnitude of impact each of these changes will have individually. It is likely the numbers will increase and that this single issue could sway it approximately 10 %. Councilor VanGordon said the financial impact is important. He looks forward to getting more information as they move forward in this process. Councilor Woodrow asked if there is something that would require them to use 20% rather than some other percentage, if they went with that type of method. Ms. Spickard said the basic premise of any of the policies is to make sure it is defensible, understandable, legal and practical administratively. Each option needs to be defensible with data. Ms. Galardi said the City will need to adopt a methodology that will establish the maximum SDC amount for each project. If they chose the trip based approach, 20% would be the maximum for the bicycle /pedestrian projects. If they chose the level of service approach, it could be 50 %. They had the choice of taking projects off the project list to reduce the overall SDC amount, leaving the method intact; or phasing in the fee level until they get to the maximum. Those are policy actions, but did have revenue implications to fund the list. Ms. Spickard said they are not building incentives into the methodology, but are leaving that to Council to recommend outside of the methodology if they chose. Councilor Ralston asked which method minimized the financial impact Ms. Spickard said using the 20% from the trip based approach. City of Springfield Council Work Session Minutes May 19, 2014 Page 5 Councilor Ralston said that is the one he would support. Councilor Brew said each of the projects on the project list has different levels of funding and different sources of funding so are not always done in the order they appear on the list. He asked if the bicycle /pedestrian projects could be protected from being removed from the list if a portion of the SDCs are being collected specifically for bicycle /pedestrian projects Ms. Spickard said they can only do the projects with the SDC funds as they are available, so there is always prioritization. The other projects will not come off of the list. Only the Council can update the project list. Councilor Moore asked if they could have an example of the difference in SDCs for a project using the different methodologies being presented. Staff said they can do that. Mayor Lundberg said Springfield is unique because we have a park district that also collects SDCs, some specifically for bicycle /pedestrian projects. She wants to see the Willamalane SDCs for the scenario Councilor Moore asked about. She wants to balance the money that goes into that realm. We are putting a percentage in for the City's paths, but they are also paying a percentage for Willamalane's paths. We have two percentages that go to bicycle /pedestrian projects in the community. Councilor Brew said the more they discuss this, the more he favors a fixed percentage. He doesn't like the way Willamalane does their SDCs and doesn't feel the City should use the same methodology. We are saying we underinvested in bicycle /pedestrian projects in the past, so catching up and adding capacity means a higher percentage is charged to growth. We aren't acknowledging that a lot of the projects on our project list are to catch up to where we should be. Ms. Galardi said if they are raising the level of service for the community, that does get taken into account and they do not allocate that portion to growth as it would be counter to the statutes. The difference is that existing development is given credit for what is on the ground today. Growth capacity needs are made up entirely from future projects. They do back out any deficiency that would be the result of increasing the miles per capita at the end of the planning horizon. Councilor Woodrow said she is not comfortable in making a decision on the level of service at this time until she has more information. She is comfortable with the straight percentage. Ms. Spickard said she would calculate both options in a sample scenario and bring that back to Council. Mayor Lundberg said everyone agreed on 70% for the external funding issue. Staff will bring back more information on the financing option. Councilor Brew said he would like to see the percentage of bicycle /pedestrian projects on the list attributed to growth and how they got that figure. He served on the committee and was very impressed by everyone that served on the committee. All of the staff did a greatjob, people felt engaged and it was a great process. City of Springfield Council Work Session Minutes May 19, 2014 Page 6 2. Glenwood Update Assistant City Manager, Jeff Towery, presented the staff report on this item. During their Goal Setting Session, Council chose Glenwood development as their focus for the upcoming year. As part of this decision, Council requested updates on current projects and opportunities to discuss the advancement of future projects at a quicker rate than currently planned. Included here is a discussion of current and future projects in Glenwood including detail related to the impacts of an increased focus on Glenwood development as a Council goal. In focusing attention and momentum on progressing development in the Glenwood area, staff recommends consideration of several key factors; current Glenwood projects already in motion, future Glenwood projects awaiting allocations of resources, and the current allocation of resources to all projects, both Glenwood specific and city/region -wide. This discussion is important in making strategic determinations to reallocate or maintain resources from one area in order to expedite development in Glenwood. It is also important in identifying key tasks and responsibilities which Council might assume in order to assist staff in leading redevelopment efforts in Glenwood. Mr. Towery said the projects have been broken into three categories: Planning; Construction; and Community Development. Shifting the focus from some of our non - Glenwood related projects to new Glenwood related projects may require adjustments to projected work plans and a re- allocation or additional resources. Staff made an effort to identify some specific roles and responsibilities for the Council as discussed during their goal setting. In the next twelve months, 31 % of our employees will be eligible to retire in the next two years, and about 56% of our managers and supervisors will be eligible to retire. Staff may bring to the Council options for succession planning and knowledge transfer since many of the projects will span longer than those people's careers. He referred to Attachment 3 of the agenda packet which is the list of Glenwood "Potential Future" projects. He noted three projects that might have potential to prime development and could relieve individual property owners of responsibilities: Update of FEMA Floodplain Maps (Trestle to 1 -5); Establishing Greenway Setback; and Vertical Housing Development Zones. Those three are hurdles that developers will have to clear to pursue any redevelopment projects on their own. Staff believed the FEMA Floodplain project is the longest -term project, up to 2 '/z years to completion. A consultant will need to be involved in most of the work and will involve decision making by both Lane County and the City of Eugene. The Greenway Setback project will about an 8 month project, will require owner consent and may involve decision making by either Lane County or the hearings official. The Vertical Housing Development Zones is about a 6 month project. The current program of SEDA paying SDCs for projects consistent with the Glenwood Refinement Plan is more of an incentive than this program, although this will be good to have on the books if the SEDA SDC program ends. Mr. Towery referred to Attachment 4 of the agenda packet. For the most part, these projects include 19 FTE from Development and Public Works Department and the City Manager's Office, but it also includes a smaller portion of the DPW Operations Division and Environmental Services/MWMC. In both of those work groups, there are a number of people who are involved in these projects for a brief period of time, and work on many other things as well. The section on the pie chart labeled "Other Work/Daily Tasks' includes support work and the daily work of the 19 people, and all of the work done by the staff from Operations and ESD. That percentage is not likely to change much based on the way the Council allocates the projects. City of Springfield Council Work Session Minutes May 19, 2014 Page 7 Mayor Lundberg said the three projects (FEMA Floodplain Maps, Greenway Setbacks, and Vertical Housing Zones), are not immediate priorities. She asked if they would be outside of other things Council identifies. Mr. Towery said those are the three potential future projects that individual property owners are likely to have to address as they move through the development process. As an example, the reason the FEMA Floodplain map is only an issue from the trestle to I -5 is because the Wildish family started that process. Those maps have been updated for their portion, but have not been updated from the trestle to I -5. It is likely that each individual property owner may have to go through similar work to move forward. City Engineer Ken Vogeney said for projects such as the Riverfront Path or reconstructing the bank, the City will need to update the maps. The concept is to look at rolling all of those projects into one map update that is comprehensive. Mayor Lundberg said the current projects are being worked on, and staff is suggesting the Council add those three projects to help move them into the work process. Mr. Towery said any of the attachments on Attachment 3 are things that are in the queue, but are not being worked on or have resources allocated to them. Any of those can be moved forward at Council's direction. Staff would then bring to Council amended work plans and scenarios of how to staff and pay for those projects and what the trade -offs might be. Those three were identified by staff as some the City might do as a single approach rather than piecemeal. The other projects on the list also have the potential to prime or accelerate development. Councilor Woodrow said she had difficulty determining what might be a priority or a good timeline when looking at the information. She would like to see something like that to help with her decision. She feels the last page of the agenda packet (Proposed Glenwood Specific Council Tasks or Responsibilities) is overwhelming. Mr. Towery said they took direction that Council wanted to do more work seriously. Staff doesn't want Council to make final decisions on the information presented at this time. If they have a sense of particular projects or initiatives that they might want to see as a higher priority, staff would do specific work on those projects to scope them out for staffing and resources to allow the Council to make a fully informed decision of priorities. Councilor Moore said it is nice to see all of the projects and having this document shows how they all overlap. She mentioned the Mobile Home Park strategy, which is huge. She is willing to do what is needed to help. Councilor Brew asked why the Vertical Housing Development Zone is third on the list if it is not something that will be much of an incentive for developers. Mr. Towery said it is on the list because the current policy for SEDA paying System Development Charges (SDCs) is subject to annual review. At some point the SEDA Board may choose to spend funds on projects rather than on the SDCs. If SEDA discontinues paying the SDCs, the Vertical Housing Development Zone can provide a similar incentive. Community Development Manager John Tamulonis said SDCs could be approximately $1.2M for a large residential development, which is an upfront cost. The Vertical Housing Development Zone City of Springfield Council Work Session Minutes May 19, 2014 Page 8 program will allow them to spread 80% of that amount over a period of ten years. There may be other developments that SEDA wants to invest in rather than paying SDCs. Councilor Brew said if the list is for 6 months out. the SEDA Board will know that far in advance if they are going to discontinue the SDC payment program. If there is another project of equivalent priority, the Vertical Housing Development Zone could be put aside. Councilor Ralston said since they decided Glenwood is their high priority for the year, they should choose the three things that will be the most difficult to overcome, such as the Greenway, Floodplain maps, and Vertical Housing. They are all key incentives to be proactive and be ready for development. Councilor VanGordon said he would like to see more information on those three items. He referred to Attachment 2 and asked if they could significantly impact the current project list rather than starting something new. That is an important policy decision worth discussing. Mr. Towery said there are likely projects that more funds could be allocated for or processes changed to accelerate things on the current project list. Councilor VanGordon said moving things onto the "To Be Done" category is critical. Mayor Lundberg agreed they needed to focus on what they are currently doing. She also agreed on the timing of the Vertical Housing Development Zone. She suggested they include the relocation of the Transfer Site as a future project. It will take a long time before they can work out some kind of a plan for that site. She is interested to see the succession plan because she doesn't want the work programs specifically around changes in personnel, but should progress as needed and be anticipated. ADJOURNMENT The meeting was adjourned at 6:59 p.m Minutes Recorder —Amy Sowa Christine L. Lundberg Mayor Attest: 61l 4 nu- --- Amy Sowa City Recorder