HomeMy WebLinkAboutPACKET Town Board Study Session 2013-03-12* Revised
NOTE: The Town Board reserves the right to consider other appropriate items not available at the time the
agenda was prepared.
STUDY SESSION
TOWN BOARD
Tuesday, March 12, 2013
4:30 p.m.
Rooms 202/203
170 MacGregor Ave.
AGENDA
4:30 p.m. Future Study Session Agenda Items.
4:40 p.m. Town’s Role in Economic Development.
5:30 p.m. Break for Dinner.
5:45 p.m. Final Costs and Financing for MPEC & Stall Barn.
6:30 p.m. Meeting Adjourn.
Administration Memo
To: Honorable Mayor Pinkham
Board of Trustees
Town Administrator Lancaster
From: Lowell Richardson, Assistant Town Administrator
Date: 03/12/2013
RE: Town Board’s Roles in Economic Development
Background:
For discussion - what is the Town Board’s role in economic development and where
would it fit within the development of the Board’s strategic plan and the components of
the plan (vision, mission, goals, objectives and action items) specific to economic
development.
The Town Board received a presentation by the Estes Valley Economic Development
Task Force on January 8, 2013 of their report “The Path Forward” and most recently
Downtown Colorado, Inc. (DCI) completed their economic technical assessment of
Estes Park on February 25th and 26th presenting their findings to the community and the
Town Board. At the January 8th 2013 Town Board meeting after the Economic
Development Task Force’s presentation it was requested this subject be brought before
the Board in May.
As an intermediate step and as part of the Board’s goal development the subject of
economic development was scheduled for this study session. Since there have been
two outside entities that have presented on economic development to the Town Board
and the community. A matrix outlining the comparisons of DCI’s recommendations and
observations and the Econ Task Force’s observations and recommendations are
attached for the Board. (see attached document)
Page 1 of 3
Matrix Comparison
Between
DCI Community Assessment Draft Report and
Econ Development Task Force Path Forward
December 2012 Preliminary Report
In DCI Assessment Draft Report 2/25-2/26/13 Path Forward presented 1/8/2013
Let your intentions inform your actions and not the reverse (p7)
Community Engagement-Economic development (p8)
• Retention and Attraction
• Streamlined Process
• Market Analysis
The Areas of Greatest Local Need, page 6
Focus Group Observations (P 11)
People feel that Estes Park is in a strong position compared to other
mountain towns, but is faced with increasing competition
An Economic Assessment of the Estes Valley. 1. Tourism is Our
Economy, page 2.
Estes Valley’s Economic Strengths and Weaknesses page 5
Focus Group Observations (P 11)
The community has identified many opportunities but lacks the
organization necessary to capitalize on them
Conclusion, page 18.
Focus Group Observations (P 11)
There is not a current year-round economy
An Economic Assessment of the Estes Valley. 1. Tourism is Our
Economy, page 2.
Estes Valley’s Economic Strengths and Weaknesses page 5
Focus Group Observations (P 11)
Natural community assets could be utilized to attract knowledge
base workers and their businesses to the town
An Economic Assessment of the Estes Valley. 3. Estes Valley’s
Highly Educated Workers are a Business Resource, page 3.
Estes Valley’s Economic Strengths and Weaknesses page 5
Focus Group Observations (P 11)
People sense there is no single driving force behind economic
development.
The Areas of Greatest Local Need, page 6.
Focus Group Observations (P 11)
The town (this should be Community) lacks a unified vision of
what it wants to be in the future
Task Force refers to vision of Town of Estes Park in the
Executive Summary, page iii.
Focus Group Observations (P 12)
We need to move beyond studies to action
Conclusion, page 18.
Observation by DCI - Estes Park has a lot of resources
and assets working for it (P 14)
Recommendation
• Don't just rely on your good looks! The tourism that you
benefit from is a gift that you cannot control; focus on
building your entire community
• The new economic reality is that you must partner to
conserve resources and stop duplication or you will fall
behind
The Need for an Economic Development Strategy, page 1.
Not addressed.
Page 2 of 3
Observation by DCI - The community is lacking clear
direction strategy to outline how to move forward (P 15 &
P 18)
Recommendations:
• Identify vision with clear priorities for the community
• community issues impacting long-term economic
development should include infrastructure capacity (as
well as affordable housing, childcare)
• Use visual mapping to identify how your physical assets
are connected
• Declare business a priority and garner political support and
resources behind these efforts
• develop one champion to drive economic and community
development process and coordinate other entities
• Creative districts, historic preservation, and color in the
Main Street program would provide additional resources
and guidelines to help shape your initiatives
The Need for an Economic Strategy, page 1
The Areas of Greatest Local Need, page 6.
Beyond scope of Task Force Report.
Conclusion, page 18.
The Path Forward: Our Action Plan, pages 9 to 16.
Beyond scope of Task Force Report. Background information
under Other Funding Mechanisms, pages 13 to 15.
Observation by DCI - Most successful community
initiatives in Estes Park seem to be in opposition to
something (P 19)
Recommendation:
Identify unifying concepts of positive initiatives the people can get
behind
• Continue facilitating regular meetings of businesses,
business associations, nonprofit and other service
providers in community to enhance communication, joint
planning, and partnership
• Community engagement processes can be driven with
economic development, historic preservation, cultural and
arts, youth engagement, nature and the environment
• Develop clear information and awareness campaigns
around initiatives
Beyond scope of Task Force Report.
Beyond scope of Task Force Report.
Beyond scope of Task Force Report.
Beyond scope of Task Force Report.
Beyond scope of Task Force Report.
Observation by DCI - A large retiree population is a great
resource (P 21)
Recommendation:
• Utilize economic development initiative to assess skills
and volunteer hours and engage more community
members in your process
An Economic Assessment of the Estes Valley. 3. Estes Valley’s
Highly Educated Residents are a Business Resource ,page 3.
Observation by DCI - There appears to be several efforts
at enhancing communication and building relationships
around economic vitality (P 25)
Recommendation:
• Develop a stronger partnership with economic
development stakeholders by outlining each rule and
responsibility
Beyond scope of Task Force Report.
Page 3 of 3
Observation by DCI - There are benefits for businesses
and people to choose Estes Park to do business, raise a
family, re-create, and work (P 37)
Recommendation:
• Promote Estes Park is a great place to work, live, play,
stay
• Engage SBDC tell businesses prepared to succeed
Estes Valley’s Economic Strengths and Weaknesses, page 5.
The Areas of Greatest Local Need, page 6.
The Areas of Greatest Local Need, page 6.
Observation by DCI - Training and education could
significantly improve the business environment (P 38)
Recommendation:
• continued educational speakers and training offered by
SBDC
The Areas of Greatest Local Need, page 6.
FINANCE Memo
To: Honorable Mayor Pinkham
Board of Trustees
Town Administrator Lancaster
From: Steve McFarland, Finance Officer
Date: March 12, 2013
RE: Final Costs and Financing for Stall Barn and MPEC
Background:
PROJECT COSTS
The staff project team is comprised of Scott Zurn (Public Works), Bo Winslow (Events),
Frank Lancaster (Town Administrator), Steve McFarland (Finance Officer), and Lowell
Richardson (Deputy Town Administrator). After a series of meetings discussing costs,
the Stall Barns/MPEC project has a current estimated budget of:
MPEC and Stall barns $6,300,000
IT 200,000
FF&E 75,000
Project Management 125,000
Start Up (Johnson study) 500,000
Landscaping 10,000
Parking lot (gravel) 10,000
UTSD taps 25,000
Town Taps (180) 180,000
Town electric (35) 35,000
Contingency 40,000
$7,500,000
The Stall Barn ($1.684m) and MPEC ($4.418m) costs (plus contingency) are taken from
the January 22, 2013 “Stall Barn/MPEC Bids” memo discussed in the Study Session.
FINANCING
Staff is making every effort to arrive at equilibrium of cash reserves for the project. On
one hand, staff wants to make sure that there is sufficient cash to meet every possible
contingency. On the other hand, staff is trying to minimize the amount of cash that
needs to be borrowed to complete the project. Staff is also concerned that not only the
correct amount of money be borrowed, but also that the annual repayment amount is
manageable.
To that end, the tentative Certificate of Participation (COPs) amount is targeted at
$6,000,000, with a 14-year repayment schedule at an AIC (all inclusive cost) rate of
2.97%. This results in annual payments of ~$530,000. (As an aside, a 10-year COPs
would have an annual payment of nearly $680,000 – staff was not comfortable with this
amount). This duration will likely allow us to stay with a bank option, rather than
undergoing a public offering (the bank option is a simpler, faster and cheaper process).
The COPs amount will also allow the Town a $270,000 margin on its annual $800,000
transfer from the General Fund to the Community Reinvestment Fund. Another key
assumption regarding project calculations is that the CH Johnson Feasibility Study’s
forecasts of a ~$150,000 operating deficit and corresponding ~$780,000 in sales tax
increase are quickly realized and stabilized.
In order to obtain a $6,000,000 COPs, the likely collateral is going to be Town Hall,
which has an insured value of $6,088,000. Key components of a COPs transaction are
that 1) the collateral piece is an integral part of the borrowing entity’s operation (ie, it
would cause signification operational issues if the collateral was lost), and 2) it is
desirable for the collateral value and amount borrowed be similar. Interestingly, an
appraisal does not seem to be necessary – insured value is usually accepted as a
reasonable identifier of market value.
A $6,000,000 COPs will require the Town to use approximately $1,500,000 of its
~$2,300,000 cash reserves to complete the project, leaving $800,000 available for other
needs.
FINANCING TIMETABLE
Steve McFarland has been working closely with Jim Manire (BLX Capital), Rick Buddin
(Kutak & Rock, bond counsel), and Greg White (Town Attorney). The following working
timetable was submitted by Jim Manire yesterday.
TOWN of ESTES PARK
Proposed Financing
Series 2013
Revised Timetable of Events as of February 27, 2013
DATE EVENT
February 27 Coordinating conference call for working group;
Begin drafting Request for Proposals;
Bond Counsel begins drafting Leasing Resolution, Leasing Documents
To be
Determined Preliminary draft of Leasing Resolution distributed
To be
Determined Conference call to review Leasing Documents
March 15 Town posts RFP for potential Bank Purchasers
April 5 Banks deliver Term Sheets to the Town
April 10 Town identifies preferred purchaser
April 19 All parties sign off on leasing documents
April 23 Regular Meeting of Town Board;
Approval of Leasing Ordinance
April 30 Interest Rate Lock completed
May 23 Closing and delivery of proceeds
The May 23rd deadline is critical in that Scott Zurn has negotiated with Doan
Construction to extend the accepted project bid price until May 31st. Staff, Greg White
and (per our current understanding) Doan Construction are all amenable to entering into
an agreement where, pending financing, the Town agrees to contract Doan at the
accepted bid price to complete the project. A contract will be entered into once
financing is secured.
Budget:
The proceeds and repayment schedule for the COPs will most likely be administered
through the Community Reinvestment Fund. Please see the attached for information on
total costs, yield statistics, and debt service schedule on the proposed $6,000,000
COPs.
Staff Recommendation:
N/A
Sample Motion:
N/A
Town of Estes Park, Colorado
Proposed 2013 Lease Financing
Assumes a 14 Year Term
$6 Million Project
Sources & Uses
Sources Of Funds
Par Amount of Bonds $6,075,000.00
Total Sources $6,075,000.00
Uses Of Funds
Deposit to Project Construction Fund 6,000,000.00
Costs of Issuance 75,000.00
Total Uses $6,075,000.00
Prop 2013 Lease Financing | SINGLE PURPOSE | 3/11/2013 | 11:10 AM
BLX Group LLC
Independent Financial Advisor Page 1
Dated 05/16/2013 | Delivered 05/16/2013
Town of Estes Park, Colorado
Proposed 2013 Lease Financing
Assumes a 14 Year Term
$6 Million Project
Debt Service Schedule
Date Principal Coupon Interest Total P+I
12/01/2013 --92,137.50 92,137.50
12/01/2014 360,000.00 2.800%170,100.00 530,100.00
12/01/2015 370,000.00 2.800%160,020.00 530,020.00
12/01/2016 380,000.00 2.800%149,660.00 529,660.00
12/01/2017 390,000.00 2.800%139,020.00 529,020.00
12/01/2018 405,000.00 2.800%128,100.00 533,100.00
12/01/2019 415,000.00 2.800%116,760.00 531,760.00
12/01/2020 425,000.00 2.800%105,140.00 530,140.00
12/01/2021 440,000.00 2.800%93,240.00 533,240.00
12/01/2022 450,000.00 2.800%80,920.00 530,920.00
12/01/2023 460,000.00 2.800%68,320.00 528,320.00
12/01/2024 475,000.00 2.800%55,440.00 530,440.00
12/01/2025 490,000.00 2.800%42,140.00 532,140.00
12/01/2026 500,000.00 2.800%28,420.00 528,420.00
12/01/2027 515,000.00 2.800%14,420.00 529,420.00
Total $6,075,000.00 -$1,443,837.50 $7,518,837.50
Yield Statistics
Bond Year Dollars $51,565.63
Average Coupon 2.8000000%
Net Interest Cost (NIC)2.8000000%
True Interest Cost (TIC)2.7998816%
All Inclusive Cost (AIC)2.9697035%
IRS Form 8038
Bond Yield for Arbitrage Purposes 2.7998816%
Weighted Average Maturity 8.488 Years
First Coupon Date 12/01/2013
Prop 2013 Lease Financing | SINGLE PURPOSE | 3/11/2013 | 11:10 AM
BLX Group LLC
Independent Financial Advisor Page 2