HomeMy WebLinkAboutMINUTES Town Board Study Session 2018-02-27
Town of Estes Park, Larimer County, Colorado February 27, 2018
Minutes of a Study Session meeting of the TOWN BOARD of the Town
of Estes Park, Larimer County, Colorado. Meeting held at Town Hall in
the Board Room in said Town of Estes Park on the 27th day of
February, 2018.
Board: Mayor Jirsa, Trustees Holcomb, Martchink, Nelson, Norris
and Walker
Attending: All
Also Attending: Town Administrator Lancaster, Assistant Town
Administrator Machalek, Town Attorney White, Director
Bergsten, Manager Fraundorf, Engineer Stallworth, and
Town Clerk Williamson
Absent: Mayor Pro Tem Koenig
Mayor Jirsa called the meeting to order at 4:15 p.m.
BROADBAND PROFORMA ANALYSIS.
Manager Fraundorf provided a brief review of the broadband effort to date. He stated
the proforma overview assumes a Town Broadband utility through a revenue bond
backed by Light and Power revenues payable in 12 to 15 years, depending on
assumptions. No direct funding anticipated from the Town. The pricing model would be
competitive both locally and nationally. The utility would be built out in phases utilizing a
“build to demand” model to ensure needed take rates. Third party providers would
provide services needed to run the utility, including a call center, billing and customer
installations.
Neil Shaw/Uptown Services LLC stated Uptown was hired to model financial outcomes
for an Estes Park fiber to the premise (FTTP) deployment. A number of deployment
scenarios were reviewed and the key financial factors of each. Key financial success
factors include both short-term and long-term success factors: operating incomes
should be positive within 2-3 years; cash flow with debt service should be positive within
3-4 years; project should pay back in no more than 20 years, less than 15 years would
be preferred; and ultimate financial performance requirement are driven by Town
resources and goals. Key drivers impacting FTTP financial performance would include
the service penetration for residential internet access services, and 10 gig services
versus a 1 gig service, and outside plant (OSP) construction costs. The original
feasibility study suggested 40% take rate for residential internet penetration and the
modeling suggests 40 to 50% penetration levels would be possible in Estes Park. The
modeling exercise tested the impact of offering 10 gig base services because the next
generation FTTP electronics would support delivery in 2018. Several variations in OSP
costs were also modeled. The utility would break even on average between 12 – 16
years, with the exception of a scenario in which a 40% take rate with no 10 gig service
would have a break even of 20 plus years.
Board questions and comments were heard and summarized: questioned if the
communities demographics were considered in the proforma; businesses are locating in
areas with fast reliable broadband services; questioned if a take rate of 40 to 50% would
be conservative; and could individuals buy in to the utility and have funds applied to bills
once service becomes available in their area.
Town Board Study Session – February 27, 2018 – Page 2
Staff stated the earlier take rate study completed was comprehensive and provided a
high level of confidence in a rate of 40% at $70 per month. Director Bergsten stated
Longmont provided an early buy in option which set unrealistic expectations and
became difficult to administer.
Director Hudson stated a financial advisor with experience in revenue bonds familiar
with the industry would need to be consulted in order to understand the Town’s options
to finance a broadband utility. Dark fiber revenues could be used to pay for a financial
advisor. Staff estimates a month lead time would be needed to identify an appropriate
financial advisor.
After further discussion, the Board reached consensus and directed staff to begin
discussion with a financial advisor to determine financing options for a broadband utility.
3RD PARTY BUILDING INSPECTIONS
Administrator Lancaster requested the item be rescheduled for the March 27, 2018
Town Board Study Session.
2018 STREET IMPROVEMENT AND TRAIL EXPANSION PROGRAM UPDATES.
Engineer Stallworth provided an overview of the 2017 street improvements completed,
including the chip sealing of approximately 6 miles, overlaid approximately 1 mile of
road and performed large patches at 8 locations, completed the MacGregor Avenue
improvements, and overlaid the Riverside parking lot in coordination with the Streets
division. The Town’s Public Works department has been improving the annual
pavement condition index (PCI) above the expected PCI rating goal established for
each year. This has been achieved through successful overlays and chip sealing.
Since the project began approximately one quarter of the roadways have been
improved. In order to reach the goal of an average of 70 PCI by 2024, the Town would
need to improve 6.5 miles per year.
For 2018, the Town anticipates expenditures of $1.675 million in street improvements,
including personnel and equipment costs, for Brodie Avenue improvements, overlays
and large patches, chip sealing, crack sealing, engineering design, and parking lot
rehabilitation. The Brodie project would add a 10-foot wide concrete trail for safe
access to the schools from Fish Creek, drainage improvements, repaving of the
roadway and the addition of a turn lane and parking. The chip seal would include 7
miles of roadway, overlay and contracted patching of 1-mile, continued crack sealing
and an overlay of Performance Park parking lot.
A portion of the 1A sales tax funds were approved for trail improvements. The funds
have allowed the Town to be more aggressive in pursuing grants by providing matching
funds, funding for additional projects, and to incentives other entities to participate. The
Town has applied for a number of grants and was awarded a Land and Water
Conservation Fund grant for Fall River Trail Phase 3 and Colorado Safe Routes to
School grant for Brodie Avenue improvements.
TRUSTEE & ADMINISTRATOR COMMENTS & QUESTIONS
Trustee Norris stated the Office of Aging of Larimer County received grant funding to
provide assistance to individuals in developing living wills. The agency has identified
Estes Park for a pilot program.
FUTURE STUDY SESSION AGENDA ITEMS
None.
There being no further business, Mayor Jirsa adjourned the meeting at 5:57 p.m.
Jackie Williamson, Town Clerk