April 19 meeting

DARK MONEY is a term used to refer to political donations in which the contributor’s identity is concealed from the public. Recently, 91% of voters in Tempe approved a proposition requiring disclosure of “all original and intermediary sources” over $1,000 used to influence elections. This does not limit the amount of money which can be donated. It simply requires disclosure of the donor s who exceed $1,000.  Our City Councilman Dave Smith thought this was a good idea for Scottsdale. He tried to get this issue up for City Council discussion. Voting in favor of discussing the issue were Dave Smith, Kathy Littlefield and Guy Phillips. Voting against even discussing the issue were Mayor Jim Lane, Linda Milhaven, Virginia Korte and Suzanne Klapp.

UPCOMING CITY COUNCIL ELECTION                                                                                                                         All three of our City Council members whose terms expire this November have announced that they are running for reelection. They are Kathy Littlefield, Linda Milhaven and David Smith. We now have four announced challengers: Bill Crawford, Becca Linning, Alyssa Robis, and Solange Whitehead. To be on the ballot, a candidate must collect 1,000 signatures by the end of May. There are seven people who have announced so far. If all seven qualify, we will have a primary election on August 28th. If there are six or less who qualify, there will not be a primary. Tea Party Scottsdale will hold a candidate forum-date to be announced.

SCOTTSDALE  ADOPT A ROAD

Tea Party has adopted a section of roadway and committed to two clean-up days each year. Our road is Chaparral between Hayden and Pima. The clean-up takes a couple of hours. The next one is this Saturday, April 21st. We meet for breakfast at Randy’s Restaurant at Hayden and Chaparral at 7:00, clean-up starts at 8:00 and we are finished by 10:00. We do need volunteers. The more people we have, the quicker it goes.

DESERT DISCOVERY CENTER/DESERT EDGE

The DDC is a proposed education center and tourist attraction. The stated purpose is to educate people about the Sonoran Desert and help promote Scottsdale as a tourist destination to draw more visitors to Scottsdale.  ASU plans research activities at the facility in a building provided to them at no charge. The proposal includes the following:
Located at the Gateway Trailhead, Thompson Peak and Bell
Use 5 acres of land which has been purchased by taxpayers and will be donated to DDC at no charge
Build a 50,000 square foot facility which will include a gift shop, some type of food service and a liquor license
At a cost of $68 million dollars
Permission for as many as 60 nighttime activities
Majority of the money ($40 million plus) is taken from our Preserve land acquisition fund.
Any revenue shortfall from the operation will be paid by Scottsdale taxpayers.
And, if the City Council is allowed to do this project, there is nothing to prevent them from coming up with new things to build on  other parts of the  Preserve.

Our City Council was ready to approve the DDC. A group called Protect Our Preserve was able to convince the Council to delay a vote pending the results of a petition drive. The petition drive is currently under way.  We have the petitions here. If you have not signed, please consider doing so after the meeting. We have about 18,000 signatures already. We need about 32,000.
I am a signature collector. People are busy, so when I approach them to sign, I have to get to the point quickly. The technique I use is to say “The short version of what we are trying to do is to handcuff the City Council so that Scottsdale voters have to approve any construction on the preserve.” Usually, that is all I have to say. People respond “handcuff the City Council? Yes, I am all for that.” That, of course, is good for the petition drive. But it says something that is really sad about the way Scottsdale voters feel about the council.                                                                     

68th STREET BRIDGE

This is the bridge which spans the Arizona Canal just north of Indian School Road. The concrete covering has deteriorated, exposing the steel of the structure which is now rusting and losing it’s strength. The bridge is 40 to 50 years old. The bridge is partially closed. Traffic is restricted to just two lanes. Reconstruction cost is “guesstimated” at $2-3 million. Target date is January, 2019 because the canal will be drained then by SRP. And this leads me into the next item which is a proposal to spend $350 million dollars on city infrastructure projects. The deteriorating bridge is exhibit A showing the need for the projects.

GENERAL OBLIGATION BONDS AND SALES TAX INCREASE

In my presentation last month, I said that it looked like we would be voting in November on whether or not to issue $350 million dollars in bonds and/or an increase in our city sales tax rate from the current 1.65% to as much as 1.95% with all of the funds to go toward capital improvements. At this past Tuesday’s City Council meeting, the plan was to approve the bonds and not increase the sales tax rate. Five of the seven members were fully on board with approving the bonds and apparently assumed that it was a done deal. Guy Phillips was against the bonds and in favor of the sales tax, and Kathy Littlefield had strong reservations against either plan. The meeting opened with discussion of the $350 million bond. Dave Smith, citing City Treasurer assurances that the bond amount could be higher without increasing taxes, moved to increase the amount to $380 million to include funding for the downtown Scottsdale stadium. The Desert Discovery Center, which was included in the original list of projects to be considered, was brought up. This elicited a strong response from Linda Milhaven who stated that the controversial DDC should not even enter the discussion. This was followed by a heartfelt response from Kathy Littlefield pointing out that the city has numerous areas of wasteful spending, the voters are disgusted with the Council, a bond is not likely to pass because of voter anger over the Council in general and the DDC in particular, and that the Council must work to regain the voter’s trust. In addition, she pointed out that the detailed information on the projects proposed to be funded by the bond had been delivered to councilmembers only one day before they were expected to vote. Linda Milhaven, Virginia Korte and Dave Smith disagreed and spoke vehemently against Littlefield’s positions.

Guy Phillips had proposed a motion, seconded by Kathy Littlefield, to defer the $350 million bond until the 2020 election, and instead, ask voters to approve a .15 cent increase in the Transportation Sales Tax rate (from .2 to .35) with the money to go exclusively to transportation projects. Guy’s proposal for something similar in prior meetings had been easily defeated, and five  council members had voiced unwavering support for the bonds, so it was a major surprise when Guy’s motion passed by a 4 to 3 margin. Voting with Guy Phillips and Kathy Littlefield were Suzanne Klapp and Mayor Jim Lane. Voting against the motion (they wanted the bonds) were Linda Milhaven, Virginia Korte and Dave Smith.

Council did not discuss any numbers, but my back of the envelope calculations predict a $15 million increase in income to the Scottsdale General Fund. You might ask how $15 million per year is going to make much difference if the need is for $350 million. The City will use what they call leverage and what we might call a home improvement loan. Suppose you received a $15,000 per year raise. You could promise the bank that you would pay them the $15,000 each year and the bank would loan you around $200,000 which you could spend right away. For the city, just add three zeros. $15 million per year becomes $200 million right away for streets and other transportation needs.

This is not finalized, but it is very likely what we will see on our ballot in November.

March 15 City Council Notes

SCOTTSDALE  ADOPT A ROAD

Tea Party has adopted a section of roadway and committed to two clean-up days each year. Our road is Chaparral between Hayden and Pima. The clean-up takes a couple of hours. The next one is next month, Saturday, April 21st. We meet for breakfast at Randy’s Restaurant at Hayden and Chaparral at 7:00, clean-up starts at 8:00 and we are finished by 10:00. We do need v The more people we have, the quicker it goes.

UPCOMING CITY COUNCIL ELECTION

All three of our City Council members whose terms expire this November have announced that they are running for reelection. They are Kathy Littlefield, Linda Milhaven and David Smith. We now have four announced challengers: Bill Crawford, Becca Linning, Alyssa Robis, and Solange Whitehead. To be on the ballot, a candidate must collect 1,000 signatures by the end of May. There are seven people who have announced so far. If all seven qualify, we will have a primary election on August 28th. If there are six or less who qualify, there will not be a primary. Tea Party Scottsdale will hold a candidate forum-date to be announced.

DESERT DISCOVERY CENTER/DESERT EDGE

The DDC is a proposed education center and tourist attraction. The stated purpose is to educate people about the Sonoran Desert and help promote Scottsdale as a tourist destination to draw more visitors to Scottsdale.  ASU plans research activities at the facility in a building provided to them at no charge. The proposal includes the following:
Located at the Gateway Trailhead, Thompson Peak and Bell
Use 5 acres of land which has been purchased by taxpayers and will be donated to DDC at no charge
Build a 50,000 square foot facility which will include a gift shop, some type of food service and a liquor license
At a cost of $68 million dollars
Permission for as many as 60 nighttime activities
Majority of the money ($40 million plus) is taken from our Preserve land acquisition fund 

Any revenue shortfall from the operation will be paid by Scottsdale taxpayers. And, if the City Council is allowed to do this project, there is nothing to prevent them from coming up with new things to build on  other parts of the  Preserve.

Our City Council was ready to approve the DDC. A group called Protect Our Preserve was able to convince the Council to delay a vote pending the results of a petition drive. The petition drive is currently under way. The simplest description of the petition is that is seeks to handcuff the Council by requiring a vote of the people to approve the DDC or any other major construction project on the Preserve and requiring a vote authorizing use of Preserve funds for this purpose. We have the petitions here. If you have not signed, please consider doing so after the meeting. We have about 10,000 signatures already. We need about 30,000.

GENERAL OBLIGATION BONDS

We have within the City Council, a group known as the Capital Improvement Plan Subcommittee. Dave Smith, Virginia Korte and Guy Phillips are the members. Capital Improvement Projects, or CIP, are expenditures for long life things-buildings, streets, parks, as opposed to things like salaries and office supplies and electric bills. The committee has the job of reviewing what the various city departments say they need and prioritizing those needs. They also have to factor in availability and timing of state and federal matching grants. The problem, of course, is that there are a lot more “essential” projects than there are dollars. They are looking at about $650 million dollars for all projects. This figure does not include Scottsdale Stadium redesign or the DDC. The committee has identified about half ($350 million) of the projects as the most pressing needs. As far as funding, the committee does not appear to be looking very hard at cutting other expenses to free up dollars for CIP. Rather, they are looking at increasing our sales tax, and increasibg stormwater fees, and also issuing general obligation bonds which do require voter approval but give the Council the money to spend today which we taxpayers pay for in the future plus interest.  $300 million dollars in GO bonds will add $111 per year to the property tax bill for a $300,000 home and $669 per year to a one million dollar commercial property.  The subcommittee has recommended implementing some combination of the above tax and increases to the Council with a unanimous 3-0 vote. The three subcommittee members,  Smith, Korte and Phillips said yes, Council should do this. Significantly, I thought ,there was absolutely no discussion of cutting expenses in other areas to free up money to divert to CIP and reduce the amount of bond money needed.
At a recent Council meeting, Linda Milhaven, (I don’t always agree with Linda, but she is very smart and able to communicate her ideas clearly), summed up the issues very succinctly:
1. Does the Council believe that we need to invest in our infrastructure?
2. If yes, do we have the dollars to do this with existing sources?
3. If not, how do we want to pay the bill?
4. How much do we want to spend in total?

Six of the seven members said yes to #1-We need to invest
Six of the seven said no to #2-Does the City have the money
Six of the seven favor GO bonds with two (Smith & Littlefield) leaning toward a small dedicated sales tax increase in addition to the GO bonds
Guy Phillips, who is on the subcommittee, did not
comment on anything at all, saying he will make his views known at the March 27th Council work session.         

The projects to be included have not yet been announced.

Here is a sampling of comments from councilmembers:

Lane-Favors GO bonds because they require a public vote, are transparent and provide a fair allocation based on who pays the taxes
Smith-We are paying less in secondary property taxes now than we did 10 years ago and this plan will not increase taxes. Tourists don’t pay property taxes, they only pay sales tax
Korte-Council must be unanimous in support if this is to stand a chance with voters
Milhaven-Important to match income sources with expenses and GO bonds do this
Littlefield-Citizens are not happy. Benefits must be spread over entire city. There are absolutely some things we could do to cut expenses.

How this will be presented to us is pretty interesting. First, of course is to convince us that the quality of the city’s infrastructure is deteriorating. Second is that the budget is stretched thin and there is no money available and the city has cut all of the fat from the budget and therefore we need a new source of money. From there, the argument switches to how to pay. We are going to see a statement that sounds silly, but is actually true. That is that we can issue these $350 million of GO bonds and our property taxes will not go up. The subtle inference here, of course, is that we can get something for nothing. What actually happens is that existing GO bonds issued in the past will be paid off over the next few years. Instead of seeing our property taxes go down, the new GO bonds will be issued in roughly the same amounts as the ones paying off, so our taxes will stay about the same.
The second selling point relates to sales taxes. The Scottsdale portion of the sales tax we pay is 1.65%.  We will hear that this is the third lowest sales tax rate in the state. And, believe it or not, we will hear that if you take out the .35% we pay for buying mountain preserve land, our rate is the lowest in the state. (Of course, they will say, the preserve tax is temporary and doesn’t fund city services, so It really shouldn’t be counted.) I found two councilmember comments to be very revealing. From Dave Smith-You can’t fund a city like Scottsdale with the lowest tax rate in the state. And from Suzanne Klapp-It’s OK with me to be the lowest in the state.

What we are likely to see on the ballot, possibly this November, is something similar to the last bond election. A list of projects grouped by category (roads, police, parks, etc.) with a price tag for each and the opportunity to say yes or no to all, or pick and choose by category. This will be accompanied by the funding mechanisms –GO bonds in the range of $350 million, a (small) sales tax increase in the range of .1 to .3 percentage points with the caveat that money raised this way will go to CIP,  and probably a storm water fee increase from the current $1.10 per month to $2 or $3 per month.

If you want to make a difference in city government, now is the time to contact the Council and share your thoughts. Voting in each election is important. But you can have a much greater impact by preempting what goes on the ballot by giving Council your early input.

February 16, Meeting Notes

We have a City Council election coming up that will be here a lot sooner than we expect. The primary, if we have one, will be in August,  and the general will be in November. So I thought I would do a little refresher course on our City Council and Mayoral election process.
First, we have one mayor and six city council members. Our Mayor is paid $36,000 per year. Council members are paid $18,000 annually. They all serve four year terms, with a maximum of three consecutive elected terms.  That works out to a maximum of twelve years.  The terms are staggered so that three council member seats come up every two years and the mayor’s position every four years. This year, the Mayor’s position is not on the ballot, so we will be choosing only the three council members.
Here is a recap of the current council. The first four are not on the ballot this year.
Suzanne Klapp-Third term expires January 2021
Virginia Korte-Second term expires January 2021
Guy Phillips-Second term expires January 2021
Mayor Jim Lane-Third term expires January 2021
The above members are not on the ballot this year.
The following will be on the ballot this year:
Kathy Littlefield-First term expires January next year
Linda Milhaven-Second term expires January next year
Dave Smith-First term expires January next year
To be on the ballot, a candidate must:
1. Be a qualified elector of the City.
2. Not hold any other public office that conflicts.
3. Be a resident of Scottsdale for one year preceding the date of election.
4. File a Committee Statement of Organization.
5. Submit nominating petitions containing 1,000 valid signatures to the City Clerk anytime during the month of May of this year.
As respects the nominating petitions, registered Scottsdale voters may sign as many as one petition for each vacancy. So, we can sign as many as three this year, but no more than three.
Regarding the actual City Council election, as long as we do not have more than two candidates for each open seat (no more than six candidates qualified for the ballot), there will not be a primary and all candidates will appear on the general election ballot in November. If there are more than six qualified candidates, it gets a little more complicated. The goal of the primary is to winnow the list down to two candidates per position. If we have more than six running, there will be a primary (on August 28
th).
Currently, we have five people who have filed the Committee Statement of Organization:
The three current City Council members-Kathy Littlefield, Linda Milhaven and David Smith have filed. Two challengers have also filed-Bill Crawford and Solange Whitehead. So we have a total of five as of now. If all five obtain the 1,000 signatures  on their nominating petitions and no other candidates qualify, there will not be a primary. If two additional candidate step forward and qualifiy, there will be a primary.
There is one other unrelated note: Councilmember Virginia Korte has announced that she is “planning to pursue the office of mayor”  in 2020 (not this election cycle, but the next one in 2020) and has formed a mayoral exploratory committee.

Locations for two new trailheads on our mountain preserve are moving forward.

The Fraesfield Trailhead consists of 6 acres at 134th Street and Rio Verde. The plan is for a main trailhead building with restrooms, an outdoor covered seating area, equestrian staging area and up to 200 parking spaces.

The Granite Mountain Trailhead will be 6 acres at 136th Street and Lone Mountain. The plan is similar to Fraesfield, but with more parking-up to 300 spaces.

Also, there will be a major trailhead off of Pima and Dynamite. The design will be similar to the others with  small open air amphitheater included.  All of these are paid for using Preserve sales tax money.

We have within the City Council, a group known as the Capital Improvement Plan Subcommittee. Dave Smith, Virginia Korte and Guy Phillips are the members. Capital Improvement Projects, or CIP, are expenditures for long life things-buildings, streets, parks, as opposed to things like salaries and office supplies and electric bills. The committee has the job of reviewing what the various city departments say they need and prioritizing those needs. They also have to factor in available state and federal matching grants. The problem, of course, is that there are a lot more “essential” projects than there are dollars. They are looking at something north of 800 million dollars for all projects. The committee has identified about half ($350 million) of the projects as the most pressing needs. As far as funding, the committee does not appear to be looking very hard at cutting other expenses to free up dollars for CIP. Rather, they are looking at increasing some of our taxes and fees (property and sales taxes) and also issuing general obligation bonds which do not require voter approval but give the Council the money to spend today which we taxpayers pay for in the future plus interest.  $300 million dollars in GO bonds will add $111 per year to the property tax bill for a $300,000 home and $669 per year to a one million dollar commercial property. 

Desert Edge is a proposed project to be located at the Gateway Trailhead. It is promoted as an interactive educational center and tourist attraction which will help to keep Scottsdale in the forefront as an international tourist destination. The project, as proposed will use 5 acres of land which is currently dedicated preserve property to build a 50,000 square foot center at a total cost in the range of $70 million. Of this, a large portion, more than $40 million would come from Preserve sales taxes-the money intended for buying Preserve land. The proposal seeks to divert money from land purchase and instead use it to pay for a building. Our current City Council leans in favor of Desert Edge. Only two council members, Kathy Littlefield and Guy Phillips are clearly against the proposal

There is an organization seeking a public vote on the Desert Edge-Protect Our Preserve PAC. Full disclosure-I am an active supporter of the group. I have petitions and will be in the hall outside after the meeting. If you live in Scottsdale and are registered to vote, please stop by and sign.

October 19, 2017 | Meeting Notes

    1. BOND OVERSIGHT COMMITTEE

In promoting the street paving bond, which we voted in favor of, the City anticipated replacing 140 miles of pavement. This turned out to be “lane miles” (one mile of a four lane street equals four lane miles.) To date, the City has completed 105 lane miles and spent $8 million of the $12.5 million authorized. The project is in its second of three years and completion is projected at September of 2018. After the bond funds are spent, paving projects will be paid from the Capital Improvement Fund which, of course, is our tax dollars.

We also passed a bond for fire stations. The first at Jomax and Hayden started construction in July and is on budget and scheduled for completion in May of next year. The second is a renovation of the station at Shea and 74th Street.  Construction started last month, is about $46,000 over budget due to unforeseen HVAC issues, and is scheduled for completion in January of next year. The third is near Indian Bend and Hayden. It is in the planning process and is $640,000 over budget due to land acquisition costs. The overrun may increase due to legal costs.  The final station at 110th St and Cave Creek is in design. The site requirements are more extensive than anticipated and may be over budget.  For the entire fire station project, there is a built in contingency amount of $1.7 million, so it appears that, in total, the costs will be close to or perhaps a little below the bonded amount.

The combined amount that we approved was $28.85 million. None of the bonds has been issued. Instead, the City has “borrowed” the money for the first part of the projects from other temporarily unused city funds, thus saving taxpayers interest.  The City Council has approved the planned sale of the bonds. The bonds are expected to be sold this coming January. The bonds will be of varying durations (one year, two year, three year, etc.) which saves in interest costs. Shorter term bonds are usually less expensive than longer term.

    1. ELECTIONS

It may seem a little early, but we will have a City Council election at the end of August.  Terms are ending for Councilmembers Littlefield, Milhaven and Smith. Linda Milhaven and Kathy Littlefield have announced that they are running.  Dave Smith has not yet announced.

    1. LAWSUIT

Back in 2015, two motorcyclists were killed when they collided with a car at a traffic light signaled intersection while participating in a Special Olympics charity ride. Scottsdale was sued, along with the Special Olympics and the motorcycle dealership which organized the event. The allegation was that the City was negligent and should have had traffic control officers at the intersection. After arbitration, the City was found 1/3 responsible and will pay about $167,000. This will be paid from the City’s operating budget. Of particular note is this quote from the City Council Report: “Scottsdale has a long standing practice of including paid tort settlements over $20,000 in the primary (property) tax rate to reimburse the Self-Insured fund for payment of the claim.

    1. GAMBLING MONEY

The City will receive $1.2 million from the Salt River Pima-Maricopa Indian Community . This is an annual distribution of a share of tribal gaming revenue approved by Arizona voters in 2002. The money is allocated by the tribe based on the tribe’s evaluation of proposals  from eligible local governments and non-profit organizations. Some of the recipients are Arizona Humane Society $50K, Ryan House $125K, SCC $100K, Desert Discovery Center $20K.

    1. WESTWORLD

We taxpayers have just funded $330,000 for a paved parking lot, $160,000 for electrical improvements and $377,000 for portable RV pedestals at Westworld, plus $12,500 for associated operating costs. That is a total of $879,500. The lone dissenter was Linda Milhaven. The purpose is to improve the facility, primarily for the Barrett-Jackson Car Auction and the Arabian Horse Show.  According to the City, the bulk of these expenses will be paid through taxes on hotel rooms, gasoline purchases and local sales taxes.  In fiscal year 2015-16, Westworld operated at a $1.8 million deficit. In addition, the City pays about $3.8 million in debt service on the $54 million construction and expansion costs incurred previously. Councilmembers Guy Phillips and Suzanne Klapp, who serve on the Westworld Subcommittee, were enthusiastically in favor of the projects. Guy feels that, eventually, the red ink will disappear as more and more events come to Westworld.

    1. MUSEUM OF THE WEST

The Tourism Development Fund (bed tax) can be a pretty good piggy bank. City Council voted 7-0 to give $500,000 to the Museum of the West which is in its third year of operation.  This money is to be spent in support of the museum’s educational program. The rationale, according to a City Council report, is “Museum does not currently have sufficient financial resources to fund the educational activities…without the immediate financial support of the City.” Perhaps a large part of the reason for the lack of funds relates to attendance. The consultant’s projection for 2016 attendance was about 93,000. Actual attendance was about 54,000, for a shortfall of 39,000. The Museum attracted about 60% of projected attendees.

    1. FASHION SQUARE

City Council debated a Fashion Square rezoning bill in August. A request to increase allowable building height from 84 to 150 feet (an increase of 66 feet) was the most controversial item in the bill. The rational expressed by City staff was that the extra height may encourage users who would not consider the site as currently zoned.  In order to get approval for the 150 foot height, the developer agreed to contribute about three quarters of a million dollars to the Downtown Cultural Trust Fund. This extra 66 feet works out to a little over $11,000 per foot. The item was passed with Littlefield and Smith dissenting.

    1. MOUNTAIN PRESERVE TRAILS

City Council awarded two contracts for design, construction, renovation and rehabilitation projects on Mountain Preserve trails. The two year maximum is $4 million, and the contracts may be renewed for three additional one year terms with a maximum of $2 million each year. The agenda item indicates that this contract will not encumber any City funds because funds are available in various Capital Improvement Plan projects. I believe that this means Preserve bond funds. This was approved 7-0 on the consent agenda.

    1. CAPITAL IMPROVEMENT PLAN SUBCOMMITTEE

This subcommittee was created recently to analyze various capital projects and recommend priorities to the full Council. The members are Korte, Phillips and Smith.  At a recent meeting, there was a lot of give and take about whether the subcommittee or City staff would be the first   to offer up a list of priorities. I think the end result was that they are both going to do a list and then compare and refine them into one list. There is a consensus that, when matching funds are available (such as Maricopa Association of Governments road funds), the Council should prioritize so as to be eligible for the funds before they are lost to other Valley projects. So we should see road and flood control projects at the top of the priority list.  And sure enough, at this past Tuesday’s full Council meeting, the Council approved funding totaling a little over $10 mil broken down with $2 mil for Rawhide Wash flood control, $1 mil for Reata Wash, $3 mil for improvements to Happy Valley Rd-Pima to Alma School and $4.4 mil for improvements on Pima from Pinnacle Peak to Happy Valley. The vote was 6-1 with Kathy Littlefield voting against. Kathy wanted separate votes-one on the flood control issues and one on the street projects.  Potential future projects that may be near the top of the priority list are: Cactus pool, Civic Center Library improvements, another new fire station, downtown parking garage, parking for Westworld and golf tournament, downtown stadium improvements, and, last but not least, the Desert Discovery Center.

    1. DESERT DISCOVERY CENTER/DESERT EDGE

And, speaking of the DDC, it now has a new name-Desert Edge.  The design is done and presented to the Council. The broad parameters are a $62 mil facility to be built on 5 acres and located at the Gateway entrance to the Preserve on Preserve land. Also included is an offsite parking area for 250 cars. Using the 80 acre site owned by the City near the Gateway for the parking area is being considered. This is the 80 acre parcel on which the City pays $3 mil per year in debt service. Desert Edge is controversial. Proponents argue that it will be a tourist draw and will enhance the Scottsdale experience, and that voters authorized it when we voted for the Preserve taxes. Opponents say voters only authorized land purchases, trails, and minor trailhead facilities. Putting aside the actual issues, the current hot button for the Council is whether or not we citizens should have an opportunity to vote on whether or not to build the center. We heard Linda Milhaven, at last month’s meeting, say that, in her opinion, we already voted in favor of the project twice when we approved the sales tax initiatives to fund the Preserve land purchases. Linda, Suzanne Klapp and Virginia Korte have said that they do not want us to vote. Councilmembers Littlefield and Phillips, along with Mayor Lane have said they are in favor of putting the issue on the ballot. Councilman Dave Smith has not stated his preference. In addition, a lawsuit initiated in part by Tea Party member Pat Shaler, has been filed. The suit alleges that City Council has misappropriated $1.76 mil for the design of a facility that cannot be constructed without the consent of 2/3 of the Council and also a majority of the voters.  They point to Article 8, Section 11 of the City Charter which states that the Council has the authority to remove from preserve designation only parcels less than 1 acre and only with a 2/3 vote (5 of 7) of all members. The Desert Edge is 5 acres. The Charter goes on to say, and this is the key point, that “removal of the parcel designation from any other parcel of land shall require approval by an affirmative vote of 2/3 of all members of the council, but shall not become effective unless submitted by the council to the electors and approved by vote of the majority of votes cast at the election.”  In short, building on more than one acre in the Preserve requires 5 Council votes and an election.

October 19, 2017 | Meeting Notes

  1. BOND OVERSIGHT COMMITTEE
  2. In promoting the street paving bond, which we voted in favor of, the City anticipated replacing 140 miles of pavement. This turned out to be “lane miles” (one mile of a four lane street equals four lane miles.) To date, the City has completed 105 lane miles and spent $8 million of the $12.5 million authorized. The project is in its second of three years and completion is projected at September of 2018. After the bond funds are spent, paving projects will be paid from the Capital Improvement Fund which, of course, is our tax dollars.

    We also passed a bond for fire stations. The first at Jomax and Hayden started construction in July and is on budget and scheduled for completion in May of next year. The second is a renovation of the station at Shea and 74th Street.  Construction started last month, is about $46,000 over budget due to unforeseen HVAC issues, and is scheduled for completion in January of next year. The third is near Indian Bend and Hayden. It is in the planning process and is $640,000 over budget due to land acquisition costs. The overrun may increase due to legal costs.  The final station at 110th St and Cave Creek is in design. The site requirements are more extensive than anticipated and may be over budget.  For the entire fire station project, there is a built in contingency amount of $1.7 million, so it appears that, in total, the costs will be close to or perhaps a little below the bonded amount.

    The combined amount that we approved was $28.85 million. None of the bonds has been issued. Instead, the City has “borrowed” the money for the first part of the projects from other temporarily unused city funds, thus saving taxpayers interest.  The City Council has approved the planned sale of the bonds. The bonds are expected to be sold this coming January. The bonds will be of varying durations (one year, two year, three year, etc.) which saves in interest costs. Shorter term bonds are usually less expensive than longer term.

  3. ELECTIONS
  4. It may seem a little early, but we will have a City Council election at the end of August.  Terms are ending for Councilmembers Littlefield, Milhaven and Smith. Linda Milhaven and Kathy Littlefield have announced that they are running.  Dave Smith has not yet announced.

  5. LAWSUIT
  6. Back in 2015, two motorcyclists were killed when they collided with a car at a traffic light signaled intersection while participating in a Special Olympics charity ride. Scottsdale was sued, along with the Special Olympics and the motorcycle dealership which organized the event. The allegation was that the City was negligent and should have had traffic control officers at the intersection. After arbitration, the City was found 1/3 responsible and will pay about $167,000. This will be paid from the City’s operating budget. Of particular note is this quote from the City Council Report: “Scottsdale has a long standing practice of including paid tort settlements over $20,000 in the primary (property) tax rate to reimburse the Self-Insured fund for payment of the claim.

  7. GAMBLING MONEY
  8. The City will receive $1.2 million from the Salt River Pima-Maricopa Indian Community . This is an annual distribution of a share of tribal gaming revenue approved by Arizona voters in 2002. The money is allocated by the tribe based on the tribe’s evaluation of proposals  from eligible local governments and non-profit organizations. Some of the recipients are Arizona Humane Society $50K, Ryan House $125K, SCC $100K, Desert Discovery Center $20K.

  9. WESTWORLD
  10. We taxpayers have just funded $330,000 for a paved parking lot, $160,000 for electrical improvements and $377,000 for portable RV pedestals at Westworld, plus $12,500 for associated operating costs. That is a total of $879,500. The lone dissenter was Linda Milhaven. The purpose is to improve the facility, primarily for the Barrett-Jackson Car Auction and the Arabian Horse Show.  According to the City, the bulk of these expenses will be paid through taxes on hotel rooms, gasoline purchases and local sales taxes.  In fiscal year 2015-16, Westworld operated at a $1.8 million deficit. In addition, the City pays about $3.8 million in debt service on the $54 million construction and expansion costs incurred previously. Councilmembers Guy Phillips and Suzanne Klapp, who serve on the Westworld Subcommittee, were enthusiastically in favor of the projects. Guy feels that, eventually, the red ink will disappear as more and more events come to Westworld.

  11. MUSEUM OF THE WEST
  12. The Tourism Development Fund (bed tax) can be a pretty good piggy bank. City Council voted 7-0 to give $500,000 to the Museum of the West which is in its third year of operation.  This money is to be spent in support of the museum’s educational program. The rationale, according to a City Council report, is “Museum does not currently have sufficient financial resources to fund the educational activities…without the immediate financial support of the City.” Perhaps a large part of the reason for the lack of funds relates to attendance. The consultant’s projection for 2016 attendance was about 93,000. Actual attendance was about 54,000, for a shortfall of 39,000. The Museum attracted about 60% of projected attendees.

  13. FASHION SQUARE
  14. City Council debated a Fashion Square rezoning bill in August. A request to increase allowable building height from 84 to 150 feet (an increase of 66 feet) was the most controversial item in the bill. The rational expressed by City staff was that the extra height may encourage users who would not consider the site as currently zoned.  In order to get approval for the 150 foot height, the developer agreed to contribute about three quarters of a million dollars to the Downtown Cultural Trust Fund. This extra 66 feet works out to a little over $11,000 per foot. The item was passed with Littlefield and Smith dissenting.

  15. MOUNTAIN PRESERVE TRAILS
  16. City Council awarded two contracts for design, construction, renovation and rehabilitation projects on Mountain Preserve trails. The two year maximum is $4 million, and the contracts may be renewed for three additional one year terms with a maximum of $2 million each year. The agenda item indicates that this contract will not encumber any City funds because funds are available in various Capital Improvement Plan projects. I believe that this means Preserve bond funds. This was approved 7-0 on the consent agenda.

  17. CAPITAL IMPROVEMENT PLAN SUBCOMMITTEE
  18. This subcommittee was created recently to analyze various capital projects and recommend priorities to the full Council. The members are Korte, Phillips and Smith.  At a recent meeting, there was a lot of give and take about whether the subcommittee or City staff would be the first   to offer up a list of priorities. I think the end result was that they are both going to do a list and then compare and refine them into one list. There is a consensus that, when matching funds are available (such as Maricopa Association of Governments road funds), the Council should prioritize so as to be eligible for the funds before they are lost to other Valley projects. So we should see road and flood control projects at the top of the priority list.  And sure enough, at this past Tuesday’s full Council meeting, the Council approved funding totaling a little over $10 mil broken down with $2 mil for Rawhide Wash flood control, $1 mil for Reata Wash, $3 mil for improvements to Happy Valley Rd-Pima to Alma School and $4.4 mil for improvements on Pima from Pinnacle Peak to Happy Valley. The vote was 6-1 with Kathy Littlefield voting against. Kathy wanted separate votes-one on the flood control issues and one on the street projects.  Potential future projects that may be near the top of the priority list are: Cactus pool, Civic Center Library improvements, another new fire station, downtown parking garage, parking for Westworld and golf tournament, downtown stadium improvements, and, last but not least, the Desert Discovery Center.

  19. DESERT DISCOVERY CENTER/DESERT EDGE
  20. And, speaking of the DDC, it now has a new name-Desert Edge.  The design is done and presented to the Council. The broad parameters are a $62 mil facility to be built on 5 acres and located at the Gateway entrance to the Preserve on Preserve land. Also included is an offsite parking area for 250 cars. Using the 80 acre site owned by the City near the Gateway for the parking area is being considered. This is the 80 acre parcel on which the City pays $3 mil per year in debt service. Desert Edge is controversial. Proponents argue that it will be a tourist draw and will enhance the Scottsdale experience, and that voters authorized it when we voted for the Preserve taxes. Opponents say voters only authorized land purchases, trails, and minor trailhead facilities. Putting aside the actual issues, the current hot button for the Council is whether or not we citizens should have an opportunity to vote on whether or not to build the center. We heard Linda Milhaven, at last month’s meeting, say that, in her opinion, we already voted in favor of the project twice when we approved the sales tax initiatives to fund the Preserve land purchases. Linda, Suzanne Klapp and Virginia Korte have said that they do not want us to vote. Councilmembers Littlefield and Phillips, along with Mayor Lane have said they are in favor of putting the issue on the ballot. Councilman Dave Smith has not stated his preference. In addition, a lawsuit initiated in part by Tea Party member Pat Shaler, has been filed. The suit alleges that City Council has misappropriated $1.76 mil for the design of a facility that cannot be constructed without the consent of 2/3 of the Council and also a majority of the voters.  They point to Article 8, Section 11 of the City Charter which states that the Council has the authority to remove from preserve designation only parcels less than 1 acre and only with a 2/3 vote (5 of 7) of all members. The Desert Edge is 5 acres. The Charter goes on to say, and this is the key point, that “removal of the parcel designation from any other parcel of land shall require approval by an affirmative vote of 2/3 of all members of the council, but shall not become effective unless submitted by the council to the electors and approved by vote of the majority of votes cast at the election.”  In short, building on more than one acre in the Preserve requires 5 Council votes and an election.

January, 18 2018  Scottsdale City Council Report by Doug Reed and intro of new TPS Officers and Directors

Good evening everybody. Before I start the City Council presentation, I would like to introduce two ladies, one who has been a frequent Tea Party visitor and contributor, Councilwoman Kathy Littlefield.  Kathy is running for reelection this year and, of course has her nominating petitions here for us to sign. And also with us this evening and running for a council seat is Solange Whitehead. Solange also has her petitions with her. I have signed both ladies petitions, and encourage all of you to sign also.

We have an election coming up that will be here a lot sooner than we expect-August for the primary and November for the general, so I thought I would do a little refresher course on our City Council and Mayoral election process.
First, we have one mayor and six city council members. Our Mayor is paid $36,000 per year. Council members are paid $18,000 annually. They all serve four year terms, with a maximum of three consecutive elected terms.  That works out to a maximum of twelve years.  The terms are staggered so that three council member seats come up every two years and the mayor’s position every four years. This year, the Mayor’s position is not on the ballot, so we will be choosing only the three council members.
Here is a recap of the current council:
Suzanne Klapp-Third term expires January 2021
Virginia Korte-Second term expires January 2021
Guy Phillips-Second term expires January 2021
Mayor Jim Lane-Third term expires January 2021
The above members are not on the ballot this year.
The following will be on the ballot this year:
Kathy Littlefield-First term expires January next year
Linda Milhaven-Second term expires January next year
Dave Smith-First term expires January next year
To be on the ballot, a candidate must:
1. Be a qualified elector of the City.
2. Not hold any other public office that conflicts.
3. Be a resident of Scottsdale for one year preceding the date of election.
4. File a Committee Statement of Organization.
5. Submit nominating petitions containing 1,000 valid signatures to the City Clerk anytime during the month of May of this year.
As respects the nominating petitions, registered Scottsdale voters may sign as many as one petition for each vacancy. So, we can sign as many as three this year, but no more than three.
Regarding the actual City Council election, as long as we do not have more than two candidates for each open seat (no more than six candidates qualified for the ballot), there will not be a primary and all six will appear on the general election ballot in November. If there are more than six qualified candidates, it gets a little more complicated. The goal of the primary is to winnow the list down to two candidates per position. If we have more than six running, there will be a primary (on August 28
th). In the primary, our City of Scottsdale Charter says that any candidate who receives a “majority” of the votes cast is automatically elected and will not appear on the general election ballot. If there are remaining seats unfilled, the top two vote getters for each remaining seat will appear on the general election ballot. The Charter goes on to explain how to calculate a “majority”. You take the total number of votes cast and divide by the number of seats (3) and divide that number in half and add one. That isn’t as convoluted as it sounds, and actually makes a lot of sense. Consider a simplified example: Three seats up, 6,000 votes cast. Dividing 6,000 by three equals 2,000. Dividing 2,000 in half and adding one equals 1001. So, in that example, any one candidate who received 1001 votes would be elected to the Council and would not be on the general election ballot. If no others received the magic 1001 number, we would still have two seats unfilled, so the top four remaining vote getters would go the the general, with the top two in the general winning a seat.
Currently, we have six people who have filed the Committee Statement of Organization:
The three current City Council members-Kathy Littlefield, Linda Milhaven and David Smith have filed. Three challengers have also filed-Bill Crawford, Tanner Van Parys and Solange Whitehead. So we have a total of six as of now. If all six obtain the 1,000 signatures  on their nominating petitions and no other candidates qualify, there will not be a primary. If one additional candidate steps forward and qualifies, there will be a primary.
I have one other note to add. This is hot off the presses. As of today, Councilmember Virginia Korte has announced that she is “planning to pursue the office of mayor”  in 2020 and has formed a mayoral exploratory committee. Our City Charter states the following: “An incumbent mayor or councilman, in the final year of a term being served, may offer himself for nomination or election to any salaried local, state or federal office, without resignation from office.  To be eligible to run for the office of mayor, an incumbent councilman who is not in the final year of the term being served, shall resign his office upon offering himself for nomination… Offer for nomination or election means either filing a nomination paper required by law to run for public office or making a formal public declaration of candidacy.”
So, if you are a councilman, you can start a run for mayor one year before the election without resigning. The next election in which the mayor’s office is up will be in November 2020. My read of the statute is that a current council member cannot announce a run for mayor until November of 2019 without resigning from the Council.

 

November 16 2017  Scottsdale City Council Report by Doug Reed

We have pretty much one subject for tonight, and that is the Desert Discovery Center which is now known as Desert Edge. But before we get to that, we have breaking news-Scottsdale City Councilman Dave Smith announced today that he will run for a second term. So, all three incumbents, Kathy Littlefield, Linda Milhaven and Dave Smith are running. In his announcement, Dave Smith had this to say about the Desert Edge:  “Council is tasked with deciding whether this is a vision we want or can afford. Large groups of citizens are speaking excitedly (for and against) this project, based on its purpose, location and cost to build and operate. “

So far, so good. Most of us probably agree with that. Then, he goes on to say: “Some of my colleagues propose to immediately refer the question to a public vote. As your elected representative, I accept responsibility to search for solutions that are financially prudent, improve the cachet of our city and support tourism. That’s a tall order, but I believe that’s what you expect from your Councilmembers.”

At a work study session two weeks ago, City Council took up, again, the Desert Discovery Center/Desert Edge.  Specifically, the meeting was for city staff to report back to the council on several requested issues.

Costs and income, the role of ASU,  funding sources including use of the preserve tax, and ballot language.

COSTS AND INCOME

The initial estimate provided by the DE was $61 mil. The city’s estimate is $68 mil. The city feels that the DE estimate is sound, but does not include items like the 1% arts requirement, city staff time, permits and contingency allowances. In addition, not included in either total is the cost to acquire and construct an overflow parking lot ($3-5 mil), and the initial operating reserve fund of $6 mil. So, the original estimate by DE has already gone from $61 mil to $68 mil to roughly $78 mil. And, one of the choices for the parking area is the 80 acre site near the Gateway which the city owns and is paying about $3 mil per year on a loan. Councilwoman Kathy Littlefield was the only member to express concern about not even discussing how the DE would be charged for this.
Separately, maintenance and operating costs are expected to be about $1.2 mill per year, including 72 full time employees and 300 volunteers. This was not discussed in the meeting, but I believe the city (we taxpayers) has committed to cover any shortfall up to $700,000 per year.
Income was glossed over. The discussion included only categories, not expected dollars. The categories include operating income from tickets, food and gift sales, and non-operating income including donations, events, memberships and grants.

They also discussed spending $100,000 on an economic feasibility study to estimate the economic benefits to the city. Kathy Littlefield, Guy Phillips, Dave Smith and Mayor Lane agreed that this was not a good idea until and unless council decides to proceed with the project.

ROLE OF ASU

ASU has  tentatively agreed to provide the following:
Global Drylands Institute headquarters
Endow 5 new faculty members
Provide scientific equipment, student scientists and docents
Support fundraising and allow the ASU name to be used, but would not provide any direct funding

FUNDING SOURCES
The Tourism Development Fund currently has about $13 mil available as undesignated and unreserved funds. In other words, a $13 mil piggy bank. In addition, the Fund has about $4 mill available each year after other commitments are covered. This $4 mill income stream can support a loan of a little over $50 mil. Add the two together and you have about $63 mil. If spent in this manner, the Fund would be fully spent for the next twenty years.
According to an opinion by the city attorney, Preserve tax dollars are available for the DE. Current estimates are that, through the end of the tax in 2034, there will be $136 mil in uncommitted cash available. Of this, $34 mil is expected to be spent on trailhead improvements and trails, leaving $102 mil available. Of that, Council (especially Mayor Lane) wants to create an endowment to fund the annual operating expenses of the Preserve (not the DE ) so that the money won’t have to come from the general fund. This endowment requires about $38 mil. So, we are down from $136 mil to $102 mil to (subtracting the $38 mil endowment) $64 mil left unspent in the Preserve fund. Remember, the discussion was over potential funding sources for the DE, so the end result here was the thought that we could use $64 mil of Preserve tax dollars to fund the project. Kathy Littlefield commented that an alternative was to not spend the money and pay off the bonds early. To complicate things further, Dave Smith is pushing for a repeal of the sales tax on food, which, if successful, would reduce the income from the Preserve fund. There are issues with conditions built into the bonds that may preclude this from happening.

Next the discussion turned to ballot language-if we are going to put this on the ballot, what will be the language?  And the result of the discussion was inconclusive and very confusing   .
First, the city attorney, Bruce Washburn, explained that council can refer to voters only that which they are “empowered to legislate.” Council cannot ask voters “what would you like us to do?”, because that is not legislation. 
Second, they discussed language allowing “operations and maintenance as permissible uses”  of Preserve tax dollars. How this relates to giving voters a chance to vote up or down on the DE is unclear, but Mayor Lane wants this so that Council can have the option to set up an endowment fund. Klapp and Phillips seemed to agree, but Smith and Korte wondered why we should fund Preserve maintenance and operations differently than we fund parks or libraries. Littlefield doesn’t want to open the door unless there is a way to limit the use to M&O. Milhaven had no comment.
Third, they discussed eliminating the food tax from the Preserve tax and splitting the remainder of Preserve tax funds between M&O and DE funding. Happily, there was a consensus that this was a little complicated and convoluted to pursue.
Then, they discussed amending the charter to allow the DDC only to be built on the Preserve and nothing in the future. Mayor Lane asked if there is a legislative way to vote on the following: “Construction of a building or buildings of not more than 50,000 square feet on not more than 6 acres and located XXXXX is permitted.”  My note-if this was on the ballot and we voted yes, council could then vote to proceed with DE. If we voted no, nothing would be changed, and council could still proceed with the project.
Other locations were discussed, with general agreement that staff should look at Taliesin, the 80 acre parcel (which is costing us $3 mil per year), Westworld, Pima & Dynamite, etc, etc. Korte commented that we all agree that this is a good project, we just disagree on the location. I don’t know that she is correct, but at this point, I think council was a little frustrated at the lack of progress. 
Further complicating the process is a referendum petition by Mark Stuart, The petition,  which is currently being circulated for signatures, seeks to prohibit any and all construction in the Preserve without a majority vote of Scottsdale citizens.
Council ended the session by asking staff  to explore other city owned sites,  to prepare a request for proposals, and to explore ballot language for a charter amendment to require a public vote on any development in the preserve,  but take no action until Mr. Stuart’s referendum petition process is completed.
In addition, a lawsuit has been filed alleging that Council has violated the city charter by misappropriating $1.76 mil tax dollars to investigate construction of a facility that cannot be constructed without a 2/3 vote of the council and approval by a majority of the voters.
And then, to top it all off, Jason Alexander has filed an IRS complaint alleging that Desert Discovery Center Scottsdale has been engaged in lobbying for the project even though its IRS filings deny any lobbying activity.
I will close by quoting a brief paragraph from the Scottsdale Independent. “Scottsdale City Council has stumbled to the realization the outcome of a citizen petition filed by Mark Stuart in December, 2016 has the opportunity to shape any and all future discussions…”, and from The Arizona Republic. “..Council happily stunned critics on Nov. 6 when it hit pause on the proposed Desert Edge… until a citizen’s initiative plays out.”

October 19, 2017 | Meeting Notes

  1. BOND OVERSIGHT COMMITTEE
  2. In promoting the street paving bond, which we voted in favor of, the City anticipated replacing 140 miles of pavement. This turned out to be “lane miles” (one mile of a four lane street equals four lane miles.) To date, the City has completed 105 lane miles and spent $8 million of the $12.5 million authorized. The project is in its second of three years and completion is projected at September of 2018. After the bond funds are spent, paving projects will be paid from the Capital Improvement Fund which, of course, is our tax dollars.

    We also passed a bond for fire stations. The first at Jomax and Hayden started construction in July and is on budget and scheduled for completion in May of next year. The second is a renovation of the station at Shea and 74th Street.  Construction started last month, is about $46,000 over budget due to unforeseen HVAC issues, and is scheduled for completion in January of next year. The third is near Indian Bend and Hayden. It is in the planning process and is $640,000 over budget due to land acquisition costs. The overrun may increase due to legal costs.  The final station at 110th St and Cave Creek is in design. The site requirements are more extensive than anticipated and may be over budget.  For the entire fire station project, there is a built in contingency amount of $1.7 million, so it appears that, in total, the costs will be close to or perhaps a little below the bonded amount.

    The combined amount that we approved was $28.85 million. None of the bonds has been issued. Instead, the City has “borrowed” the money for the first part of the projects from other temporarily unused city funds, thus saving taxpayers interest.  The City Council has approved the planned sale of the bonds. The bonds are expected to be sold this coming January. The bonds will be of varying durations (one year, two year, three year, etc.) which saves in interest costs. Shorter term bonds are usually less expensive than longer term.

  3. ELECTIONS
  4. It may seem a little early, but we will have a City Council election at the end of August.  Terms are ending for Councilmembers Littlefield, Milhaven and Smith. Linda Milhaven and Kathy Littlefield have announced that they are running.  Dave Smith has not yet announced.

  5. LAWSUIT
  6. Back in 2015, two motorcyclists were killed when they collided with a car at a traffic light signaled intersection while participating in a Special Olympics charity ride. Scottsdale was sued, along with the Special Olympics and the motorcycle dealership which organized the event. The allegation was that the City was negligent and should have had traffic control officers at the intersection. After arbitration, the City was found 1/3 responsible and will pay about $167,000. This will be paid from the City’s operating budget. Of particular note is this quote from the City Council Report: “Scottsdale has a long standing practice of including paid tort settlements over $20,000 in the primary (property) tax rate to reimburse the Self-Insured fund for payment of the claim.

  7. GAMBLING MONEY
  8. The City will receive $1.2 million from the Salt River Pima-Maricopa Indian Community . This is an annual distribution of a share of tribal gaming revenue approved by Arizona voters in 2002. The money is allocated by the tribe based on the tribe’s evaluation of proposals  from eligible local governments and non-profit organizations. Some of the recipients are Arizona Humane Society $50K, Ryan House $125K, SCC $100K, Desert Discovery Center $20K.

  9. WESTWORLD
  10. We taxpayers have just funded $330,000 for a paved parking lot, $160,000 for electrical improvements and $377,000 for portable RV pedestals at Westworld, plus $12,500 for associated operating costs. That is a total of $879,500. The lone dissenter was Linda Milhaven. The purpose is to improve the facility, primarily for the Barrett-Jackson Car Auction and the Arabian Horse Show.  According to the City, the bulk of these expenses will be paid through taxes on hotel rooms, gasoline purchases and local sales taxes.  In fiscal year 2015-16, Westworld operated at a $1.8 million deficit. In addition, the City pays about $3.8 million in debt service on the $54 million construction and expansion costs incurred previously. Councilmembers Guy Phillips and Suzanne Klapp, who serve on the Westworld Subcommittee, were enthusiastically in favor of the projects. Guy feels that, eventually, the red ink will disappear as more and more events come to Westworld.

  11. MUSEUM OF THE WEST
  12. The Tourism Development Fund (bed tax) can be a pretty good piggy bank. City Council voted 7-0 to give $500,000 to the Museum of the West which is in its third year of operation.  This money is to be spent in support of the museum’s educational program. The rationale, according to a City Council report, is “Museum does not currently have sufficient financial resources to fund the educational activities…without the immediate financial support of the City.” Perhaps a large part of the reason for the lack of funds relates to attendance. The consultant’s projection for 2016 attendance was about 93,000. Actual attendance was about 54,000, for a shortfall of 39,000. The Museum attracted about 60% of projected attendees.

  13. FASHION SQUARE
  14. City Council debated a Fashion Square rezoning bill in August. A request to increase allowable building height from 84 to 150 feet (an increase of 66 feet) was the most controversial item in the bill. The rational expressed by City staff was that the extra height may encourage users who would not consider the site as currently zoned.  In order to get approval for the 150 foot height, the developer agreed to contribute about three quarters of a million dollars to the Downtown Cultural Trust Fund. This extra 66 feet works out to a little over $11,000 per foot. The item was passed with Littlefield and Smith dissenting.

  15. MOUNTAIN PRESERVE TRAILS
  16. City Council awarded two contracts for design, construction, renovation and rehabilitation projects on Mountain Preserve trails. The two year maximum is $4 million, and the contracts may be renewed for three additional one year terms with a maximum of $2 million each year. The agenda item indicates that this contract will not encumber any City funds because funds are available in various Capital Improvement Plan projects. I believe that this means Preserve bond funds. This was approved 7-0 on the consent agenda.

  17. CAPITAL IMPROVEMENT PLAN SUBCOMMITTEE
  18. This subcommittee was created recently to analyze various capital projects and recommend priorities to the full Council. The members are Korte, Phillips and Smith.  At a recent meeting, there was a lot of give and take about whether the subcommittee or City staff would be the first   to offer up a list of priorities. I think the end result was that they are both going to do a list and then compare and refine them into one list. There is a consensus that, when matching funds are available (such as Maricopa Association of Governments road funds), the Council should prioritize so as to be eligible for the funds before they are lost to other Valley projects. So we should see road and flood control projects at the top of the priority list.  And sure enough, at this past Tuesday’s full Council meeting, the Council approved funding totaling a little over $10 mil broken down with $2 mil for Rawhide Wash flood control, $1 mil for Reata Wash, $3 mil for improvements to Happy Valley Rd-Pima to Alma School and $4.4 mil for improvements on Pima from Pinnacle Peak to Happy Valley. The vote was 6-1 with Kathy Littlefield voting against. Kathy wanted separate votes-one on the flood control issues and one on the street projects.  Potential future projects that may be near the top of the priority list are: Cactus pool, Civic Center Library improvements, another new fire station, downtown parking garage, parking for Westworld and golf tournament, downtown stadium improvements, and, last but not least, the Desert Discovery Center.

  19. DESERT DISCOVERY CENTER/DESERT EDGE
  20. And, speaking of the DDC, it now has a new name-Desert Edge.  The design is done and presented to the Council. The broad parameters are a $62 mil facility to be built on 5 acres and located at the Gateway entrance to the Preserve on Preserve land. Also included is an offsite parking area for 250 cars. Using the 80 acre site owned by the City near the Gateway for the parking area is being considered. This is the 80 acre parcel on which the City pays $3 mil per year in debt service. Desert Edge is controversial. Proponents argue that it will be a tourist draw and will enhance the Scottsdale experience, and that voters authorized it when we voted for the Preserve taxes. Opponents say voters only authorized land purchases, trails, and minor trailhead facilities. Putting aside the actual issues, the current hot button for the Council is whether or not we citizens should have an opportunity to vote on whether or not to build the center. We heard Linda Milhaven, at last month’s meeting, say that, in her opinion, we already voted in favor of the project twice when we approved the sales tax initiatives to fund the Preserve land purchases. Linda, Suzanne Klapp and Virginia Korte have said that they do not want us to vote. Councilmembers Littlefield and Phillips, along with Mayor Lane have said they are in favor of putting the issue on the ballot. Councilman Dave Smith has not stated his preference. In addition, a lawsuit initiated in part by Tea Party member Pat Shaler, has been filed. The suit alleges that City Council has misappropriated $1.76 mil for the design of a facility that cannot be constructed without the consent of 2/3 of the Council and also a majority of the voters.  They point to Article 8, Section 11 of the City Charter which states that the Council has the authority to remove from preserve designation only parcels less than 1 acre and only with a 2/3 vote (5 of 7) of all members. The Desert Edge is 5 acres. The Charter goes on to say, and this is the key point, that “removal of the parcel designation from any other parcel of land shall require approval by an affirmative vote of 2/3 of all members of the council, but shall not become effective unless submitted by the council to the electors and approved by vote of the majority of votes cast at the election.”  In short, building on more than one acre in the Preserve requires 5 Council votes and an election.

October 19, 2017 | Meeting Notes

  1. BOND OVERSIGHT COMMITTEE
  2. In promoting the street paving bond, which we voted in favor of, the City anticipated replacing 140 miles of pavement. This turned out to be “lane miles” (one mile of a four lane street equals four lane miles.) To date, the City has completed 105 lane miles and spent $8 million of the $12.5 million authorized. The project is in its second of three years and completion is projected at September of 2018. After the bond funds are spent, paving projects will be paid from the Capital Improvement Fund which, of course, is our tax dollars.

    We also passed a bond for fire stations. The first at Jomax and Hayden started construction in July and is on budget and scheduled for completion in May of next year. The second is a renovation of the station at Shea and 74th Street.  Construction started last month, is about $46,000 over budget due to unforeseen HVAC issues, and is scheduled for completion in January of next year. The third is near Indian Bend and Hayden. It is in the planning process and is $640,000 over budget due to land acquisition costs. The overrun may increase due to legal costs.  The final station at 110th St and Cave Creek is in design. The site requirements are more extensive than anticipated and may be over budget.  For the entire fire station project, there is a built in contingency amount of $1.7 million, so it appears that, in total, the costs will be close to or perhaps a little below the bonded amount.

    The combined amount that we approved was $28.85 million. None of the bonds has been issued. Instead, the City has “borrowed” the money for the first part of the projects from other temporarily unused city funds, thus saving taxpayers interest.  The City Council has approved the planned sale of the bonds. The bonds are expected to be sold this coming January. The bonds will be of varying durations (one year, two year, three year, etc.) which saves in interest costs. Shorter term bonds are usually less expensive than longer term.

  3. ELECTIONS
  4. It may seem a little early, but we will have a City Council election at the end of August.  Terms are ending for Councilmembers Littlefield, Milhaven and Smith. Linda Milhaven and Kathy Littlefield have announced that they are running.  Dave Smith has not yet announced.

  5. LAWSUIT
  6. Back in 2015, two motorcyclists were killed when they collided with a car at a traffic light signaled intersection while participating in a Special Olympics charity ride. Scottsdale was sued, along with the Special Olympics and the motorcycle dealership which organized the event. The allegation was that the City was negligent and should have had traffic control officers at the intersection. After arbitration, the City was found 1/3 responsible and will pay about $167,000. This will be paid from the City’s operating budget. Of particular note is this quote from the City Council Report: “Scottsdale has a long standing practice of including paid tort settlements over $20,000 in the primary (property) tax rate to reimburse the Self-Insured fund for payment of the claim.

  7. GAMBLING MONEY
  8. The City will receive $1.2 million from the Salt River Pima-Maricopa Indian Community . This is an annual distribution of a share of tribal gaming revenue approved by Arizona voters in 2002. The money is allocated by the tribe based on the tribe’s evaluation of proposals  from eligible local governments and non-profit organizations. Some of the recipients are Arizona Humane Society $50K, Ryan House $125K, SCC $100K, Desert Discovery Center $20K.

  9. WESTWORLD
  10. We taxpayers have just funded $330,000 for a paved parking lot, $160,000 for electrical improvements and $377,000 for portable RV pedestals at Westworld, plus $12,500 for associated operating costs. That is a total of $879,500. The lone dissenter was Linda Milhaven. The purpose is to improve the facility, primarily for the Barrett-Jackson Car Auction and the Arabian Horse Show.  According to the City, the bulk of these expenses will be paid through taxes on hotel rooms, gasoline purchases and local sales taxes.  In fiscal year 2015-16, Westworld operated at a $1.8 million deficit. In addition, the City pays about $3.8 million in debt service on the $54 million construction and expansion costs incurred previously. Councilmembers Guy Phillips and Suzanne Klapp, who serve on the Westworld Subcommittee, were enthusiastically in favor of the projects. Guy feels that, eventually, the red ink will disappear as more and more events come to Westworld.

  11. MUSEUM OF THE WEST
  12. The Tourism Development Fund (bed tax) can be a pretty good piggy bank. City Council voted 7-0 to give $500,000 to the Museum of the West which is in its third year of operation.  This money is to be spent in support of the museum’s educational program. The rationale, according to a City Council report, is “Museum does not currently have sufficient financial resources to fund the educational activities…without the immediate financial support of the City.” Perhaps a large part of the reason for the lack of funds relates to attendance. The consultant’s projection for 2016 attendance was about 93,000. Actual attendance was about 54,000, for a shortfall of 39,000. The Museum attracted about 60% of projected attendees.

  13. FASHION SQUARE
  14. City Council debated a Fashion Square rezoning bill in August. A request to increase allowable building height from 84 to 150 feet (an increase of 66 feet) was the most controversial item in the bill. The rational expressed by City staff was that the extra height may encourage users who would not consider the site as currently zoned.  In order to get approval for the 150 foot height, the developer agreed to contribute about three quarters of a million dollars to the Downtown Cultural Trust Fund. This extra 66 feet works out to a little over $11,000 per foot. The item was passed with Littlefield and Smith dissenting.

  15. MOUNTAIN PRESERVE TRAILS
  16. City Council awarded two contracts for design, construction, renovation and rehabilitation projects on Mountain Preserve trails. The two year maximum is $4 million, and the contracts may be renewed for three additional one year terms with a maximum of $2 million each year. The agenda item indicates that this contract will not encumber any City funds because funds are available in various Capital Improvement Plan projects. I believe that this means Preserve bond funds. This was approved 7-0 on the consent agenda.

  17. CAPITAL IMPROVEMENT PLAN SUBCOMMITTEE
  18. This subcommittee was created recently to analyze various capital projects and recommend priorities to the full Council. The members are Korte, Phillips and Smith.  At a recent meeting, there was a lot of give and take about whether the subcommittee or City staff would be the first   to offer up a list of priorities. I think the end result was that they are both going to do a list and then compare and refine them into one list. There is a consensus that, when matching funds are available (such as Maricopa Association of Governments road funds), the Council should prioritize so as to be eligible for the funds before they are lost to other Valley projects. So we should see road and flood control projects at the top of the priority list.  And sure enough, at this past Tuesday’s full Council meeting, the Council approved funding totaling a little over $10 mil broken down with $2 mil for Rawhide Wash flood control, $1 mil for Reata Wash, $3 mil for improvements to Happy Valley Rd-Pima to Alma School and $4.4 mil for improvements on Pima from Pinnacle Peak to Happy Valley. The vote was 6-1 with Kathy Littlefield voting against. Kathy wanted separate votes-one on the flood control issues and one on the street projects.  Potential future projects that may be near the top of the priority list are: Cactus pool, Civic Center Library improvements, another new fire station, downtown parking garage, parking for Westworld and golf tournament, downtown stadium improvements, and, last but not least, the Desert Discovery Center.

  19. DESERT DISCOVERY CENTER/DESERT EDGE
  20. And, speaking of the DDC, it now has a new name-Desert Edge.  The design is done and presented to the Council. The broad parameters are a $62 mil facility to be built on 5 acres and located at the Gateway entrance to the Preserve on Preserve land. Also included is an offsite parking area for 250 cars. Using the 80 acre site owned by the City near the Gateway for the parking area is being considered. This is the 80 acre parcel on which the City pays $3 mil per year in debt service. Desert Edge is controversial. Proponents argue that it will be a tourist draw and will enhance the Scottsdale experience, and that voters authorized it when we voted for the Preserve taxes. Opponents say voters only authorized land purchases, trails, and minor trailhead facilities. Putting aside the actual issues, the current hot button for the Council is whether or not we citizens should have an opportunity to vote on whether or not to build the center. We heard Linda Milhaven, at last month’s meeting, say that, in her opinion, we already voted in favor of the project twice when we approved the sales tax initiatives to fund the Preserve land purchases. Linda, Suzanne Klapp and Virginia Korte have said that they do not want us to vote. Councilmembers Littlefield and Phillips, along with Mayor Lane have said they are in favor of putting the issue on the ballot. Councilman Dave Smith has not stated his preference. In addition, a lawsuit initiated in part by Tea Party member Pat Shaler, has been filed. The suit alleges that City Council has misappropriated $1.76 mil for the design of a facility that cannot be constructed without the consent of 2/3 of the Council and also a majority of the voters.  They point to Article 8, Section 11 of the City Charter which states that the Council has the authority to remove from preserve designation only parcels less than 1 acre and only with a 2/3 vote (5 of 7) of all members. The Desert Edge is 5 acres. The Charter goes on to say, and this is the key point, that “removal of the parcel designation from any other parcel of land shall require approval by an affirmative vote of 2/3 of all members of the council, but shall not become effective unless submitted by the council to the electors and approved by vote of the majority of votes cast at the election.”  In short, building on more than one acre in the Preserve requires 5 Council votes and an election.