HomeMy WebLinkAbout07-12-2010 - Supplemental MaterialsCITY OF MEDINA
Office of the City Manager
Date July 12, 2010
To: Mayor and City Council
From: Donna Hanson, City Manager
Subject: City Funding Options
Council Facilities Committee met last week to review City Hall bid results. The bid results
indicate that the project is underfunded by approximately $500,000 to $700,000 when all
costs such as architects fees, temporary city hall, landscaping of the park, technology, moving
costs, sales tax and furniture are taken into consideration. The Committee's recommendation
was to reject all bids and rebid the project after value engineering to determine it costs could
be reduced. The Committee also recommended that staff look at funding options for
increased costs above the $1.5M budged in 2008.
I contacted Tracey Dunlap, Finance Director for the City of Kirkland. Judy Cox, Public
Finance Consultant with MRSC, and Hugh Spitzer, Municipal Bond Council with Foster
Pepper.
Attached is a list of bond financing options and descriptions from Hugh Spizter. Also attached
is a summary of revenue options provided to Council during the 2010 budget preparation.
In addition to these, there is a Local Government Capital Asset Lending (LOCAL)
program. Since the bond issue would be relatively small, as bond issues go, using
LOCAL might be cheaper. The major benefits of LOCAL are (1) simplicity and (2) low
cost financing. Participants will benefit from the current program rating of Moody's
Aa2, low fees and expenses, and access to the public bond markets.
http://www.tre.wa.gov/LOCAUindex.shtmi
• $2.2M Reserve Fund
• There were some new wrinkles offered as part of the stimulation package 18 months
ago. But, the authority to levy at least some of the different kinds of bonds may have
been continued.
® FOSTER PEPPER....
BOND FINANCING BY WASHINGTON CITIES
Washington cities incur several types of debt to pay for capital improvement projects. Cities
have authority to issue general obligations payable from taxes, revenue obligations payable from
the revenues of a particular enterprise or utility, and obligations payable from assessments. The
obligation is usually in the form of bonds sold to the public via an underwriter, but the obligation
can take other forms: bank lines of credit, bonds sold directly to an investor through a private
placement, or financing leases, for example. The debt can be structured as long-term bonds or
short-term notes. Typically, bonds or notes are structured so that the interest paid to investors is
tax-exempt under federal income tax laws. By issuing tax-exempt bonds or notes cities can
access capital financing at rates lower than the rates available to issuers of taxable obligations.
When structuring a debt financing, therefore, factors to consider are the source of repayment of
the debt (taxes, revenues or assessments), the term over which the debt will be repaid and the
investors to whom the obligation will be sold (to a particular bank or to the public, to the taxable
bond market or to the tax-exempt bond market). The following provides a brief introduction to
capital financing methods employed by Washington cities, and includes an explanation of some
of these factors.
General Obligation Debt
General obligations are those obligations of a municipality to the payment of which the full faith
and credit of the municipality is pledged. A general obligation is usually payable from property
taxes, or at least from tax sources. Many types of obligations may be "general obligations" of a
municipality, whether or not they are incurred through the issuance of a bond. General
obligations may be incurred in the form of a registered warrant, conditional sale contract, lease
or other instrument in which an unconditional and unlimited promise to pay is made.
Nonvoted General Obligation Bonds. Cities are allowed to issue nonvoted general obligation
bonds (commonly known as councilmanic bonds) backed by the cities' taxing authority as long
as all such outstanding obligations do not exceed 1 V2% of the value of the taxable property in the
city. Such obligations are payable from regular property tax levies (subject to the maximum levy
rate of $3.60/$1,000 of assessed value and the 101 % limitation discussed below). Included
within this nonvoted debt capacity are any conditional sales contracts or financing leases that
constitute "debt" under Washington law.
Voted General Obligation Bonds. Unlimited tax general obligation bonds are payable from
property taxes in excess of regular tax levies. Cities may issue voted general obligation bonds in
an amount, together with other outstanding voted and nonvoted debt, that does not exceed 2'/2%
of the value of the taxable property in the city. Cities have an additional 2%2% of debt capacity
for bonds issued for open space and park purposes and 2'/z% for utility purposes. An election
must be held at which the total number of persons voting is not less than 40% of the total votes
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509776531
cast at the last preceding general election and at least 60% of those voting approve the bond
proposition.
Levy Limits. Cities are allowed to levy regular property taxes of $3,375 per $1,000 of assessed
value of the taxable property in the city, and an additional $.225 per $1,000 of assessed value if
not required to fund pension programs. A city may not levy its full $3.60 per $1,000, however, if
regular property taxes exceed the levy limit factor in Chap. 84.55 RCW. Chapter 84.55 RCW
limits the total dollar amount of regular property tames levied by a taxing district without voter
approval to the highest amount of such taxes levied in the three most recent years (adjusted to
account for new construction, improvements and state -assessed property), multiplied by a limit
factor. Initiative 747 reduced the limit factor. For most cities, the new limit factor is the greater
of (i) the lesser of 101 % or 100% plus a measure of inflation or (ii) any percentage up to 101 %,
if approved by a supermajority council vote, upon a finding of substantial need. Of course, the
rate of inflation can be expected to exceed 1 % annually; so as a practical matter, the new limit
factor is a flat 101 %.
Because the levy limit applies to the total dollar amount levied rather than to levy rates, increases
in the assessed value of property in the city (excluding new construction, improvements and
State -assessed property) that exceed 1 % will result in decreased levy rates. If the 101 % limit is
preventing a city from levying the full $3.60 per $1,000, an election may be held to increase the
regular property tax levy to a specified amount (not more than the $3.60 limitation). A simple
majority of the voters voting must approve the proposition. This is known as a "levy lid lift."
Revenue Obligations
Cities may issue revenue bonds payable from the revenues of a particular utility or enterprise.
Traditionally, revenue bonds are "self-liquidating" in that they are repaid solely from revenues
derived from the facility financed with proceeds of the bonds. Revenue bonds are commonly
issued for water, sewer, solid waste and electric facilities. They are not general obligations or
"debt" (within the debt restrictions of the state constitution or statutes) and have no claim on any
tax revenues for payment of debt service. The revenues collected for the facility must be
deposited into a special fund and pledged to pay debt service on the bonds.
When issuing revenue bonds the city will ordinarily covenant to give bondholders a first lien on
revenues of the utility or enterprise financed, subject to prior payment of maintenance and
operation costs. Because the source of repayment of the bonds is limited to revenues produced
by the utility or enterprise, the bond ordinance will also include a number of bondholder
covenants to preserve the strength of that revenue stream. For example, the bond ordinance will
include covenants to maintain rates at a level that comfortably covers the debt service on the
bonds, covenants to insure the revenue -producing facility, covenants not to dispose of the
facility, and covenants not to issue additional bonds with a parity lien on revenues unless the city
demonstrates that revenues are sufficient to pay comfortably the additional bonds as well as the
original bonds.
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50977653.1
LID or Assessment Bonds
Local improvement district ("LID") or assessment bonds are payable solely from assessments
levied against property specially benefited by the improvements constructed out of the proceeds
of the bonds. LIDS are typically formed to finance roads or water and sewer improvements. LID
bonds do not impact a city's debt capacity, even if the LID bonds are secured by the city's LID
guaranty fund.
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50977653.1
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ATC OUTDOOR DAS
July 12, 2010
Dear Council Members:
On behalf of ATC Outdoor DAS, LLC, I'd like to reiterate our thanks and support for the
Council's efforts to permit Distributed Antenna Systems ("DAS") in the public rights -of -way in
Medina as a means to improve wireless communications service to the community. This letter is
intended to respond to several questions that one or more members of the Council have raised
over the past several months as you have considered DAS and corresponding amendments to
your wireless communication facility code, MCC Ch. 17.90. We would also like to take this
opportunity to express our position on one of the key issues that the Council will be addressing
on July 121" - whether and to what degree to require undergrounding of the ground level
equipment appurtenant to wireless communication facilities. (With respect to DAS, this would
affect the hub location.) As always, we would welcome the opportunity to speak with each of
you in person. Whether this occurs in person or through this letter, we want to be sure to provide
you with as much information regarding how DAS networks operate generally, as well as
specifically regarding ATC' proposal and what it will mean for Medina.
What Will A DAS Network Look Like?
One of the critical questions that we have heard several Council members ask is: what
will a DAS network look like in Medina? We have enclosed photo simulations of each of the ten
node locations that ATC has proposed as part of its DAS network. These are effectively
"existing" and "proposed" pictures. The photo on the left shows the existing utility pole without
the additional DAS node equipment. The photo on the right shows how that same utility pole
will look with the DAS node equipment attached.
As you can see, ATC is proposing to attach up to four flush mounted panel antenna at
each node location, as well as two pole -mounted equipment cabinets. Each of these pole
mounted equipment cabinets is approximately 4.5 cubic feet, so together the two measure
approximately 9 cubic feet. While ATC may not need to attach two pole -mounted equipment
cabinets at each node when it first installs its DAS network, it may need to add the second pole -
mounted equipment box as additional carriers decide to ride on ATC's DAS network.
Will The City Be Cluttered With DAS Nodes?
No. As stated above and shown in the photo simulations, ATC is currently proposing
only ten DAS nodes. That means ten utility poles to which panel antennas and pole mounted
equipment boxes will be attached. ATC anticipates that this configuration will be adequate to
support at least three wireless carriers on its DAS network. That means that ATT, T-Mobile and
Sprint (for example) could all use this one system to improve their wireless service in Medina.
10 Presidential Way • Woburn, MA 01801 • 781.926.4500 Office • 781.926.4555 Fax + www.americantower.corn
ATC OUTDOOR DAS
It is possible that in the future ATC will consider supplementing its currently proposed
system with additional adjacent nodes to accommodate additional wireless carriers or with
additional DAS nodes in other portions of the City per requests from wireless carriers. We do
not, however, have any plans to do that at this time. However, even if future nodes are added to
additional poles, the City will not be encumbered with a cluttered look. As you have recognized,
this is a key benefit to using the City's right of way for DAS installations.
In addition, it is possible that another DAS carrier will approach Medina to locate a
network in the City. For example, Crown Castle, which also builds DAS networks, as well as
macrocell wireless communication facilities, responded to the City's prior Request for Proposals
when you were looking for a consultant to help explain the current options in wireless
technology. Based on the experiences of other cities with outdoor DAS networks, it is highly
unusual for a second DAS provider to build a network where another DAS network already
exists. This is because it is typically substantially less expensive for a wireless carrier (e.g.,
ATT, Verizon, or T-Mobile) to contract to ride on the existing DAS network rather than pay
another DAS provider to construct a new system in an area that is already served by a DAS
network.
How Many Hubs Will There Be and Where Will They Be Located
The DAS network proposed by ATC will be supported by a single hub location. That is
where all of the wireless carriers riding on the DAS network will locate their equipment. DAS
hubs would not be located in the right of way. All of the equipment actually attached to the pole
will belong to ATC, not to any of the individual wireless carriers.
ATC has proposed to locate the hub for its DAS network at the Puget Sound Energy
Substation at 1000 80t' Ave NE in Medina. We have contracted with PSE to reserve up to 1,500
square feet of area at the substation for the DAS hub location. This should be adequate to
accommodate the equipment of all wireless carriers located on the proposed DAS network. In
sum, multiple wireless carriers will be able to ride ATC' network using just this one hub
location.
Currently, ATC is proposing locating that hub at grade. We believe that the equipment
that makes up the hub blends smoothly with the existing equipment at the PSE substation — in
fact, this was one of the main reasons for choosing the PSE substation as the location for the hub.
While we understand that the Council may be considering requiring hub locations to be
undergrounded, we would strongly request and recommend that the City not require
undergrounding. Locating the hub below grade puts it at high risk for water and storm damage.
A forceful storm could flood the hub, leaving residents without access to either their land line
phones or their wireless phones. Loss of telecommunications services would likely interfere
with residents' ability to call e911 in case of emergencies. In addition, it is two to three times as
expensive to locate the hub underground as compared to locating it in a non-residential structure.
10 Presidential Way • Woburn, MA01801 • 781.926.4500 office • 781,926.4555 Fax • www.americantower.com
ATC OUTDOOR DAS
The visual impacts of a non-residential structure, which will blend seamlessly with the
surrounding development, simply does not warrant the added expense.
Finally, it is not necessary to underground the hub to ensure that it has no visual impact
on the surrounding community. As explained herein, ATC has proposed to locate its hub at the
PSE substation. That location is entirely screened by trees. Further, the City could require other
methods, such as landscaping or locating the hub equipment in an accessory structure, to obscure
other hub locations (if and when any are proposed).
Other Comments re& rding Proposed Wireless Code Amendments
ATC is currently in the process of preparing written comments regarding the second draft
of the City's proposed wireless code amendment. The second draft was made available to the
public on Thursday. Since then, we have been working to review it and develop substantive
comments. We hope to have these to the City in the next few days so that they may be
considered as the code amendment continues through the review and approval process.
ATC again thanks the City of Medina for its effort to permit wireless communication
facilities, and particularly DAS networks, in the public rights of way as a means to improve
wireless service in the City. Please know that we are always available to answer any questions
that any person at the City may have regarding how DAS operates in general and ATC's
proposed network specifically.
Sincerely,
I
Alexander P. Gamota
Director — DAS Strategic Relations &
Network Policy
781.926.4902
alex.gamotanamericantower.com
cc: Donna Hanson
Robert Grumbach
Doug Kearney
Laura Altschul
Molly Lawrence
Enclosures (2): "Existing and Proposed" Photosims
10 Presidential Way • Woburn, MA 01801 • 781,926.4500 Office 9 781.926.4555 Fax • www.americantower.com
CITY COUNCIL MEETING
PUBLIC COMMENT SIGN IN SHEET
Public comment is encouraged and appreciated. With the exception of public hearings, this is the only
opportunity for the public to address the City Council on agenda items or any other city related business.
In order to accomplish all business on the agenda and be respectful of everyone's time, council members
will not be able to engage in dialogue with individual members of the audience and no immediate action
will be taken on any public comment issue.
Complete the following information and submit to the City Clerk prior to the meeting. When your name is
called, proceed to the podium and state your name and address. Please limit your comments to 3 minutes.
Name:
Address:
PLEASE PRINT LEGIBLY
Po I
Phone: ? (y— �-- --0
1. Public comments sign in sheet must be completed before speaking.
2. Public comment limited to three minutes per speaker.
3. No speaker may conveyor donate his or her time to another speaker.
4. Comments shall be courteous and respectful at all times.
5. No person may use public comment for the purpose of campaign or advertisement.
6. This is not a question and answer time and council can not engage in conversation with the public.
7. Questions and concerns about operations should be addressed with city staff during regular
business hours.
8. The presiding officer has the responsibility for enforcing these rules and may change the order of
speakers so that testimony is heard in the most logical groupings.
1 WISH TO SPEAK to the City Council on the following agenda item and/or issue:
0 )
❑ IN LIEU OF SPEAKING I request the City Clerk to include my written comments into the public
record.
Signature Required:
Date:
By signing, I acknowledge public comment period rules.
Pursuant to RCW 42.56, this document is considered a public record. Disclosure may be required upon request.
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CITY OF MEDINA
Office of the City Manager
Study Session July 12, 2010
Date: July 6, 2010
To: Mayor and City Council
Via: Donna Hanson, City Manager
From: Joe Willis Sr., Director of Public Works
Subject: Streetscape Policies and Street Standards
As an introduction to these issues, I would like to outline for Council the topics in
this report.
I. NE 12th/Lake Washington Blvd Traffic Safety Improvement Project
II. SR 520 design concepts and standards
III. Medina Comprehensive Plan related to Streets and Community Design
IV. Policy Considerations for Council
I. The NE 121h Street/Lake Washington Blvd. Traffic Safety Improvement Project
was in response to neighborhood concerns expressed to Council in 2009
regarding speeding traffic, limited sight distance and problems exiting driveway
entrances onto the street, and difficulty residents have in crossing the street.
The Council authorized a traffic study which was prepared by Transpo Group
and learned from the study that speeds on the street were excessive. Council
met with the traffic consultant in a study session to evaluate a number of
options to improve traffic safety in the corridor and provided direction to the
consultant. An Open House was held and a majority of the residents that front
the street attended and commented on the options presented. The new Council
authorized the consultant to proceed with the design on May 10th.
The project includes two phases. Phase I focuses on the installation of a
gateway treatment at 88th Ave NE with a landscaped median, enhanced
crosswalks with entry signage and pedestrian activated lights, roadway
restriping to create a center turn lane and additional medians along the Lake
Washington Blvd. corridor. Phase II will include a crosswalk near 86th Ave NE,
further treatment at the west end of the bicycle lane on NE 12th Street, a
widened sidewalk around the utility pole at the west end of the bicycle lane,
and completion of the sidewalk on the north side of the street at 86th Ave NE.
Colie Hough -Beck of HBB Landscape Architecture was asked to develop design
alternative concepts for the gateway treatment and to complete the median
planting design for the project following Council consideration. Colie will be
presenting gateway treatment concepts for Council comment.
II. SR 520:
In the case of the SR 520 Eastside Transit and HOV Project, the WSDOT
consultant staff collaborated with Eastside Points Community representatives
to develop an Urban Design Criteria manual to guide the Design -Build Contract
team in their design and construction of the highway lids, sound walls, trails,
and landscaping. The manual is a guidance document and not a design
standard. The State will require the contract team to follow the State's Plans
Preparation Manual and WSDOT Design Standards for the project. In those
areas that are outside of State right-of-way or are to be turned back to the City,
City Standards will govern.
Considerations for Council relative to the SR 520 Project are:
➢ The review and approval of cooperative agreements between WSDOT and
the City that defines the roles and responsibilities of both parties and
governs city participation in the design and construction of the project
including financial implications
➢ Review the design elements for the highway/transit project and consider
their impact on existing and future city land use, zoning, and capital projects
➢ Review the aesthetic and design goals in the Urban Design Criteria and
consider policies to provide a framework for staff as they participate in
project reviews, design changes, and approval of permits for those portions
of the project within City rights -of -way
➢ Does the Council want to adopt a Medina Street Standard prior to the
beginning of the SR 520 design effort?
III. Medina Comprehensive Plan Street Policies and Standards
Robert Grumbach has reviewed the City Comprehensive Plan relating to
streetscape and provided a summary report for Council. Chapter 5
Transportation & Circulation Element of the Plan under GOAL T-G6 says
"maintain and enhance the informal landscape character of the City's public
streets". The Policies in the Plan set forth the objective to provide
improvements that are designed to maintain the City's natural and informal
character with highly visible streets to be heavily landscaped with native trees
and shrubs arranged in an informal manner. These goals and policies all
emphasize "natural" and "informal".
Chapter 3 Community Design Element of the Plan includes a Medina
Landscape Plan, Street Design and Treatment, Street Landscaping, and Public
Spaces sections that all emphasize community character and its preservation.
Policy CD-P1 reads: `The city shall maintain and implement the Street Design
Standards and Landscaping Plan, including landscaping of arterial street right-
of-way".
Street Design Standards as defined by most cities are generally engineering
design guidelines and construction guidance documents. They are used to
define specific street improvements such as travelled roadway lane widths,
shoulder and walkway widths, roadway geometry and alignment, curbs,
drainage, traffic control markings and signage, street lighting, etc. They seldom
2
deal with appearance and community character or contain landscaping design
palettes and overarching esthetic considerations.
RCW 35.78.040 requires municipalities to apply uniform design standards (as
adopted by the State Design Standards Committee) to all new arterial street
construction and to reconstruct old streets as far as practicable. Local Agency
Guidelines Manual prepared by the WSDOT Highways and Local Programs in
accordance with RCW 35.78.040 is the adopted design standard and applies to
all arterial streets and roads. Chapter 42 of the Manual is applicable to all City
and County arterial and collector street designs. The Manual does not deal with
appearance and community character.
Further consideration should be given to Non -Motorized Facilities (sidewalks,
pathways, bicycle facilities, and street edges such as curbs). RCW 35.70 for
example places the burden and expense of constructing sidewalks along the
side of any street or other public place upon the property abutting on it. RCW
35.69.020 further places the completion of a missing section or a portion of
sidewalk that is disrepair if the city by resolution finds the improvement is
necessary for public safety and convenience, on the abutting property. Should
the City decide that a more formal (urban) design standard is desired for City
streets, frontage improvements could be required whenever property re-
develops.
IV. Policy Considerations for Council:
1. Review the Comprehensive Plan Community Design Element and the
Transportation and Circulation Plan chapter Goals and Policies to decide if
Council wants to initiate a process to amend the Comprehensive Plan.
2. Decide if you want to adopt Medina Street Design Standards that at a
minimum apply to arterial streets.
3. Consider if you want to expand the scope of street design standards to
residential streets.
3