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HomeMy WebLinkAboutPackets - Council Packets (133)Town Council Meeting Announcements 1 Upcoming Meetings 2 3 4 Zoning Code Amendment Medical Marijuana Dispensaries Hours of Operation Town Council June 1, 2016 5 Request Change hours of operation Current: 9:00 a.m. – 5:00 p.m. Proposed: 7:00 a.m. – 10:00 p.m. Applicability Tangerine Road Rancho Vistoso Blvd 6 Public Safety Reviewed by OVPD No prior safety issues Recent onsite inspection Additional security measures 7 Compatibility of Business Hours Businesses in Safeway Shopping Center Pharmacy and other commercial uses Dispensaries in neighboring jurisdictions 8 Summary and Recommendation Safety evaluated by the Oro Valley Police Department Proposed hours are compatible and consistent with other retail operations in a commercial zone Planning and Zoning Commission recommends approval 9 10 11 Text Amendment Modify Hours of Operation 11 12 ABOUT CATALINA CARE OPERATING SINCE JUNE 2013 Licensed to operate by the Arizona Department of Health Services. First and only dispensary in Oro Valley There are many different types of medical marijuana. Key part is to match patient’s condition with the appropriate strain of medical marijuana. 12 13 WHAT DO WE PROPOSE? REQUEST: Zoning Ordinance Text Amendment to modify the hours of operation NO changes to spacing, or any other development standards 25.1.(V) Medical Marijuana Uses 1.b.xi.    The permitted hours of operation of a medical marijuana dispensary are between the hours of 9:00 a.m. and 5:00 p.m. 7:00 a.m. and 10:00 p.m. 13 14 SITE LOCATION SITE 14 15 MMJ HISTORY Only 1 per CHAA allowed until 2015 Dispensaries can now transfer locations without regard to CHAA limits (subject to Town zoning standards) Trend is to move OUT of suburban locations to downtown or higher density areas. DHS in process of revisiting their rules No transfer application requests received by Town. SITE 15 16 LOCATIONS IN METRO TUCSON 16 17 HOURS OF OPERATION Recent Text Amendments in Tempe, Sahuarita, Marana, Tucson. No correlation between “public safety issues” and hours of operation. Oro Valley currently has among the most restrictive hours of operation 17 18 IS THIS A PUBLIC SAFETY PROBLEM? 2014: Voluntary Security Review with Police Department Glass security film for breakage; Strike plates on back and safe room doors; Peep holes on doors; Replace style of panic button;  Battery backup for camera system; Name of business on rear door; Light above back door; Panoramic peep hole on back door; Security and password upgrades to wifi range, signal output and bandwidth; Security video DVR backup; Green cross for front door; Increase amount of security camera monitoring for outside perimeter; and Security video coverage for 100% of interior of dispensary. January 8, 2016: Met with Police Chief Daniel Sharp NO ISSUES March 19, 2016: Fire Department Report indicates “No Comments” NO ROBBERIES, POLICE CALLS SINCE OPENING IN 2013 18 COMMUNITY BENEFIT Improved Access for Oro Valley patients Oro Valley is a commuter town. This will enable Oro Valley residents ability to purchase medical marijuana before and after work. Located in a safe, convenient location near home. Sales tax revenue to City. 19 NEIGHBORHOOD OUTREACH Located in a retail center with medical users Met with retail center owner and business owners No opposition expressed No letters of opposition received by Town 20 21 Text Amendment Modify Hours of Operation 21 22 Five-Year Forecast General, Highway, Bed Tax and Community Center Funds June 1, 2016 23 Forecast Overview Required per adopted financial policies Snapshot based upon current known information Serves as foundation for future budgets Sources: AZ Dept. of Revenue, Joint Legislative Budget Committee, AZ Dept. of Transportation, Troon management and Parks and Recreation management for Community Center Fund forecast Pleased to present the 5-year financial forecast this evening – specifically focusing on the General, Highway, Bed Tax and Community Center Funds Our adopted financial policies require the preparation of this forecast, and we typically present this in conjunction with the adoption of the budget so that you can see how budget decisions for next fiscal year impact the future years’ financial picture. Also, since Town does not adopt a multi-year budget, a key benefit of forecast is our ability to use it as a foundation or baseline target for future year budgets. The forecast presented this evening reflects continued economic growth, both locally and statewide, and in the residential and commercial sectors in our community. This growth translates to modest, but steady, increases in our local sales tax categories and in our state shared revenues projected over the next 5 years. It is a snapshot of how the future may look based on the current set of assumptions that I will cover over the next few slides. The forecast assumptions were compiled by referencing several sources of data, including the AZ Dept of Revenue, the Joint Legislative Budget Committee, AZ Dept. of Transportation, as well as Troon mgmt. and Parks & Rec mgmt. for the Community Center Fund forecast. 24 General Fund Revenues 2% – 4% growth per year in local sales taxes 2% – 4% growth per year in state shared revenues 200 – 275 single family residential permits per year Commercial permit revenues at $250K - $500K per year 3% – 5% growth per year in charges for services No annexations included Start off with the General Fund - Overall, the General Fund remains stable over the 5-year horizon with modest, steady growth in our local revenue sources and State shared revenue sources. The forecast shows steady 2 – 4% growth in our local sales tax revenues, and based on projections from the State, State shared revenues are expected to increase from 2-4% annually. The forecast assumes steady growth will continue in residential construction activity over the next 5 years, and that single family residential permits peak in FY 18/19 with 275 permits that year and decline to 200 permits in FY 20/21, the final year in the forecast. Commercial construction revenues range from $250K - $500K per year, with several notable projects included over the forecast period to include the Amphi STEM school, the All Seasons facility at the Innovation Corporate Center and the Nakoma Sky independent living and memory care project. 3-5% annual growth in charges for services is assumed based on observed trends in revenues from the Aquatics center and parks & recreation programs and plan review fees. Finally, there is no revenue growth due to the completion of any annexation included in the forecast. 25 General Fund Expenditures Merit increases of 3.5% per year and step increases per year 5% public safety pension increases per year 2% health insurance premium increases per year No staffing level increases O&M flat with continued funding of fleet and computer replacement Begin utilizing vehicle reserve/set-aside balances for replacements in FY 19/20 Transfer of construction sales taxes to Highway Fund begins in FY 16/17 CIP funding based on projected available revenues The expenditure projections reflect the continued commitment to providing fair employee compensation with merit increases of 3.5% per year and step increases for sworn police personnel. Also included is 5% annual increase in public safety pension costs each year, as well as 2% health insurance premium increases annually. No capacity has been included to add new staff positions, and operations & maintenance costs are projected to remain flat as much as possible; however, the forecast includes continued funding of our fleet and computer replacement programs. As part of our vehicle replacement program, we’ve been funding the replacement of vehicles that are at the end of their useful lives each year, and at the same time, we’ve been proportionately setting aside funds to replace those vehicles when they reach the end of their useful lives in the future. By FY 19/20, we anticipate being able to utilize those funds in reserve for replacement vehicles for the first time, which lowers our budget burden for vehicle replacement for the years to follow. The transfer of construction sales taxes to the Highway Fund begins in FY 16/17 and continues annual thereafter, ranging from $100,000 up to $1.5 million, as the fund balance in the Highway Fund approaches the $500,000 level. This renewed transfer of funds to the Highway Fund will have an impact on the resources available for CIP funding in the future years. Finally, the fund balance in the General Fund is maintained at healthy levels over the 5-year period above the adopted policy of 25% of adopted expenditures each year. 26 General Fund Forecast - CURRENT Here is the chart that depicts the 5-year forecast trends with the blue line representing Revenues ranging from $33M to just over $37M, and the red line representing Expenditures very closely following the revenue trend line. The fund balance remains steady at approximately $10M per year over the 5 years. Again, this chart looks very similar to last year’s forecast and reflects the financial stability of this fund, with revenues very closely matching expenditures, both operating and capital. 27 General Fund Forecast – MARCH 2011 The alignment of General Fund revenues and expenditures now is drastically different from where our projections were 5 years ago as we headed into FY 2011/12, as you can see from this chart from 2011. At that time, we were still seeing the impacts from the Great Recession, and you can see the gap between projected revenues and expenditures and the related projected decline in the fund balance. Through a wide variety of budget balancing measures, including right-sizing the organization through attrition, paying off debt, revenue enhancements and engaging in regional partnerships accomplished over the past several years, our budget is now structurally balanced with ongoing revenues dedicated to ongoing expenditures and one-time revenues dedicated to one-time capital expenditures. 28 Highway Fund Revenues 3.5% growth per year in HURF gas taxes Reimbursement from Pima Association of Governments and Regional Transportation Authority for contract administration of roadway widening projects Reimbursement from Stormwater Utility Fund for storm cleanup of streets Construction sales taxes transferred in from General Fund beginning in FY 16/17 Moving on to the Highway Fund. Highway Fund revenues are primarily comprised of State shared highway gas taxes. The forecast assumes 3.5% growth in HURF gas taxes as projected by the AZ Dept of Transportation. Also included are reimbursements from PAG and the RTA for our staff who perform construction administration and inspection on the major road widening projects that are planned over the next 5 years for Lambert Lane, Tangerine and La Cholla Blvd. This fund also projects continued reimbursement from the Stormwater Utility Fund for storm cleanup of streets provided by our Highway Fund personnel and equipment. As mentioned earlier, FY 16/17 begins the transfer in of construction sales tax revenues from the General Fund at sufficient levels to maintain the ending fund balance at approx. $500,000 per year. 29 Highway Fund Expenditures Personnel budget increases consistent with General Fund O&M remains flat and includes fleet replacement/reserve funds As with General Fund, begin utilizing vehicle reserve/set-aside balances for replacements in FY 19/20 Pavement preservation funding of $1.25M per year maintains current overall condition index (OCI) rating Maintains fund balance near $500K each year Expenditures in the Hwy Fund reflect similar assumptions as those included in the General Fund relating to personnel and O&M costs. As with GF, we will be able to utilize the vehicle reserves for replacing vehicles starting in FY 19/20. Funds for pavement preservation are included at $1.25M per year to maintain our overall condition index rating. Finally, the fund balance in this fund remains near $500,000 per year. 30 Highway Fund Forecast Here is the Hwy Fund chart that shows expenditures with the red line, and revenues shown with the blue line. You can clearly see the impact of the construction sales taxes transferred in beginning in FY 16/17, and the fund balance is stabilized in the outer years at roughly $500,000 per year. 31 Bed Tax Fund Revenues & Expenditures Assumes revenue growth due to Hilton El Conquistador renovations Average 3% annual growth in outer years Personnel budget increases consistent with General Fund Visit Tucson and Greater Oro Valley Chamber of Commerce funding consistent with current contracts Funding for special events and SAACA Debt service and repayment to General Fund for Aquatic Center The Bed Tax fund captures revenues generated by the Town’s 6% lodging tax on hotel/motels. The majority of these funds are required by law to be allocated to tourism promotion and economic development purposes. This fund remains stable over the forecast period with projected growth due to the Hilton El Conquistador planned room renovations in the earlier years of the forecast and an average 3% growth per year thereafter as the tourism industry continues to recover. Personnel cost increases are consistent with those in the other funds, and funding for Visit Tucson and the Greater Oro Valley Chamber of Commerce are consistent with the current funding agreements for those agencies. Funding is included for special events at about $50,000 per year and for arts/culture and concert series events put on by SAACA ranging from $33,000 - $35,000 per year. Expenditures also include the annual debt service payment on the bonds issued to construct the Aquatic Center and the payback of the General Fund loan used to build the Aquatic Center as well. 32 Bed Tax Fund Forecast This fund is balanced with projected growth in bed tax revenues and fairly flat expenditures. The ending fund balance in this fund ranges from approximately $230,000 to about $420,000 by the 5th year. 33 Community Center Fund Revenues 3% – 4% growth per year in half-cent dedicated sales tax Town operating revenues reflect 3% – 4.5% growth per year in member dues and 1% - 4% growth per year in recreation program revenues 3.5% growth per year in contracted operating revenues from Troon Finally, in the Comm Ctr Fund, we are projecting modest, steady growth in the revenues over the 5-year term. 3 – 4% growth is assumed in the half-cent dedicated sales taxes, which is consistent with our growth projections in the General Fund. Following this trend, the sales tax collections are estimated to increase from $2.1M in FY 16/17 to over $2.4M in the 5th year. Revenues from the Town-managed fitness and recreation operations reflect 3 – 4.5% growth in member dues revenue and 1 – 4% growth in recreation program revenues. Revenues from the Troon-managed operations of golf, f&b and tennis are modest at about 3.5% growth per year, reflecting continued capital investment in the facility and increased advertising and marketing of the facility. 34 Community Center Fund Expenditures Town operating expenditures reflect same personnel budget increases consistent with General Fund and 1% - 6% growth per year in O&M Contracted operating expenditures reflect 3% growth per year in payroll costs, 2% increase per year in cost of goods sold and 3% increase per year in other operating costs Utility costs and base management fees remain flat Capital outlay and CIP funding based on projected available capacity Annual loan repayment to General Fund of $120K For expenditures, the assumptions for personnel budget growth are consistent with those in the other Town funds for the Town-managed operations at the Comm Ctr. O&M budget increases range from 1 – 6% over the forecast due primarily to projected growth in advertising and marketing capacity and increased recreation programming. For the Troon-managed operations, payroll and operating costs are programmed at 3% growth per year, while cost of goods sold averages 2% growth per year. Utility costs are projected to remain flat with the energy efficiency project, as well as the base mgmt. fees are held flat. Capital projects are cash-funded, pay-as-you-go, and are based on projected available resources, ranging from $310,000 to $835,000. Also included is the annual loan repayment back to the General Fund of $120K per year. 35 Community Center Fund Forecast This chart depicts the Community Center Fund forecast with revenues and expenditures aligning in FY 17/18 and beyond. The fund balance remains positive during the 5-year timeframe ranging from about $42K next FY to over $100K in the outer years. 36 Questions? 37 38 FY 2016/17 Final Budget Adoption June 1, 2016 39 FY 16/17 Budget Timeline This evening is the culmination of a 7 month budget preparation process that began in December with the development of the CIP. We received early input and guidance from the completion of our updated Strategic Plan by Mayor and Council and launched a new outreach tool this year with the 5 Questions in 5 Minutes online budget questionnaire after seeing participation dwindle in our previously held community budget forum meetings had occurred over the past 3 fiscal years. With the online questionnaire, we received 124 responses, which helped guide resource allocation throughout the budget. We delivered a balanced Town Manager’s Recommended Budget on April 15th. Held 2 budget study sessions in April, and on May 20th , held the first public hearing on the budget and adopted the Tentative Budget in the amount of $119.7M. And we are here tonight to consider adoption of the Final Budget and the 15-Year Capital Improvement Plan. 40 FY 16/17 Final Budget Tentative Budget adopted May 19, 2016 Maximum spending limit set at $125,885,698 Includes Council-approved changes from May 19th, which include: Funding for new swings at Riverfront Park totaling $21,480 in the General Fund A new fund entitled ‘Energy Efficiency Project Fund’ to account for this project at the Community Center with a budget of $3 million A new fund entitled ‘Capital Project Bond Fund’ to provide budget capacity for the possible issuance of bonds in FY 16/17 with a budget of $5 million Final budget, CIP approval and second public hearing Council has authority to amend budget throughout the fiscal year At the last Council meeting on May 20th, the adoption of the tentative budget set the maximum spending limit for FY 2015/16 at $119.7 million. No changes have been proposed by Council to the Tentative Budget amounts, so tonight is the 2nd public hearing and consideration for adoption of the Final Budget for FY 15/16. Also presented for Council approval tonight is the 15-year Capital Improvement Plan. The Council may propose changes to the budget this evening or you also have the authority to amend the budget throughout the fiscal year. 41 Budget vs. Actual Comparison – All Funds There were some comments at the last Council mtg when the Tentative Budget was adopted expressing concern that the spending cap was too high for next year. The next two slides are meant to put the Final Budget amount of $119.7M into perspective and provide a comparison to historical adopted budget amounts going back 10 years. As you know, our budget amounts are set based on our estimated revenues plus the amounts that we have in our fund balance reserves. The adopted budget amounts have fluctuated and not only reflect the impact of the Great Recession when we saw budgets dip below the $100M mark from FY 11/12 through 13/14, but also the rebound of the local construction activity in the single-family and multi-family housing markets and the dedication of those one-time revenues to capital infrastructure projects within the budget. You will also notice that actual annual spending has trended far below the adopted budget amounts each year, and over the past 4 years, spending actually dipped in FY 13/14 from FY 12/13. For FY 15/16, the estimated annual budget for operations and capital is approximately $84M, while fund balance reserves of about $36M make up the balance of the Final Budget total of $119.7M. 42 FY 16/17 CIP Budget = $27,703,000 Capital Improvement Program (CIP) Includes funding for: Streets/Roads $12,602,000 Parks & Rec Facilities $9,344,000 * Water System $3,385,000 Public Safety $1,945,000 Other Public Facilities $237,000 Technology $140,000 Stormwater System $50,000 * Includes $3 million for energy efficiency project at Community Center and $5 million capacity for potential bond-funded projects Also submitted for your approval this evening is the 15-Year Capital Improvement Plan. The 15-Year CIP totals nearly $272M, while the FY 2015/16 CIP budget totals $20.7M and includes funding for a wide variety of public facility improvements and infrastructure. 43 Questions? 44 45 TROON & GOLF JUNE 1, 2016 Town of Oro Valley 46 TROON LOSSES THROUGH THE END OF FISCAL YEAR 2015/2016 Town of Oro Valley 47 MISSED PROJECTIONS Town of Oro Valley 48 BUT WAIT, WE CLOSED THE POOL AND LIMITED COURSE TIMES AND RESTAURANT AVAILABILITY Town of Oro Valley 49 ALLEDGED PLANS Town of Oro Valley 50 Vote to acquire the community center PLAN ONE Town of Oro Valley 51 Troon Operating Projections Golf, Food/Beverage, Tennis Town of Oro Valley On the Troon-managed side of the operations for golf, food/beverage and a portion of tennis, we have worked very closely with Troon as they developed a multi-year financial projection in these areas. Based on existing financial information from the Hilton in this area, Troon’s experience with managing other similar operations, the anticipated capital investment that would be planned and the wide range of programming considerations to grow the game of golf in the community, annual revenues are estimated to grow from $4.4M in the first full year to $6.6M by FY 18/19. Expenses are estimated to grow from $5.6M to $6.3M over the same timeframe, with annual estimated losses going from $1.2M to positive in FY 18/19. 52 Capital Improvements – Facilities 5-year forecast Town of Oro Valley To determine the capital needs of the facility, our Town building official conducted an extensive inspection of the facilities and categorized the needs into the various categories: There are some immediate ADA and code compliance items that deal with life-safety issues that would be recommended to be addressed this fiscal year if this acquisition is approved. Recognizing that this is a distressed and aged property, funds are also included to replace HVAC units, pool pumps and upgrading some of the electrical and mechanical systems. After the first year, these costs average approximately $500K annually. 53 Capital Improvements - Golf 10-year forecast Town of Oro Valley We also asked Troon officials to develop a longer term 10-year capital plan to address the needs primarily on the golf facilities. Their experts conducted on-site inspections over several days on two or three separate occasions First 5 years see some increased costs associated with irrigation and pump replacement at the Conquistador course, and ongoing improvements in other areas. 54 2015-2016 BUDGET PLAN TWO Town of Oro Valley 55 CAPITAL IMPROVEMENTS $1,115,000 Town of Oro Valley 56 REEVALUATE FINANCIALS OCTOBER 7, 2015 CLEAR COMMUNITY CENTER WAS IN FINANCIAL TROUBLE Town of Oro Valley 57 POLITICS MAJORITY OF COUNSEL REFUSES TO REEVALUATE THE FINANCIAL NUMBERS ELECTION OCCURS FINANCIAL NUMBERS ARE MAGICALLY REEVALUATED Town of Oro Valley 58 CLOSE THE POOL, CLOSE THE GOLF COURSES ON MONDAY AND REDUCE RESTAURANT HOURS PLAN THREE Town of Oro Valley 59 SAVINGS ARE PROJECTED AT $469,500 CAPITAL IMPROVEMENTS REMAIN AT $1,115,000 NOVEMBER 13, 2015 MEMORANDUM PROPOSES CLOSURE OF THE POOL, PARTIAL CLOSURE AND REDUCED HOURS FOR FOOD AND BEVERAGE ANG GOLF OPERATIONS Town of Oro Valley 60 December 2 reduce capital to $670,000 a total reduction of capital investment of $445,000 PLAN FOUR Town of Oro Valley 61 REDUCE CAPITAL yet AGAIN PLAN FIVE Town of Oro Valley 62 CAPITAL IMPROVEMENTS Town of Oro Valley 63 GOLF COURSE CLOSURES PLAN SIX Town of Oro Valley 64 GOLF COURSE CLOSURES PUSH RIDGE CLOSED MAY 2 TO OCTOBER 31. CONQUISTADOR CLOSED JUNE 11 TO OCTOBER 3. CANADA CLOSED MAY 2 TO JUNE 10. Town of Oro Valley 65 2016 – 2017 BUDGET PLAN SEVEN Town of Oro Valley 66 2016-2017 BUDGET REDUCES CAPITAL IMPROVEMENTS AGAIN Town of Oro Valley 67 CONCLUSION Town of Oro Valley 68 69