WEDNESDAY, FEBRUARY 21, 2007

REGULAR MEETING

7:30 P.M.

1. ROLL CALL. Mr. Smith called the meeting to order at 7:30 P.M., with roll call as follows: Mr. Sabatino, Mrs. Hammond, Mr. Smith, and Mr. Fix were present. No members were absent. Others present were Judy Gilleland, Lynda Yartin, Linda Fersch, Lance Schultz, Tim Hansley, Paul Lane, David Kandel, Kevin Futryk, Rick Ricketts, Daryl Berry, Mike Tillis, Brad Hughes, Jennifer Robertson, John Rousch, and others.

2. A. APPROVAL OF MINUTES OF January 18, 2007, Work Session. Mr. Fix moved to approve; Mrs. Hammond seconded the motion. Mr. Smith, Mr. Fix, and Mrs. Hammond voted “Aye.” Motion carried, 3-0.

B. APPROVAL OF MINUTES OF January 18, 2007, Regular Meeting. Mr. Fix moved to approve; Mrs. Hammond seconded the motion. Mr. Fix, Mr. Smith, and Mrs. Hammond voted “Aye.” Motion carried, 3-0.

3. Presentation by Kevin Futryk regarding Central Ohio Municipal Alliance. Ms Gilleland stated Mr. Futryk had phoned and was caught up in traffic so he would be a little late. Mr. Smith stated this item would be carried on the agenda.

4. Presentation by SBC regarding “PROJECT LIGHT SPEED.” Mr. David Kandel, AT&T Director of External Affairs provided a power point presentation for the Committee. (Attachment 1 to these minutes.) Mr. Kandel stated he would answer any questions the Committee members may have. Mr. Smith clarified the equipment box that would only be placed in existing easements that are designed for utilities. Mr. Kandel stated if they needed to go into the right-of-way then would come to the City for a permit. He further stated if there were a situation where the box is not located in the best of places, they would do extensive landscaping to screen it. Mr. Smith further clarified that the choice of a service provider would be the resident’s choice. Mr. Fix clarified that the network is currently being built, and they have a three-year build schedule. Mr. Kandel stated they hoped to have service available to at least a portion of the City’s residents sometime before the end of 2007. Mr. Sabatino stated he felt it was a good thing to have a choice for the City’s residents. Mr. Kandel stated the investment AT&T would be bringing to Pickerington is significant, the build schedule he has outlined is significant, and it will give residents a choice they have never had. He stated to the extent they are successful, that will determine how much further they will expand. Mr. Smith moved to authorize the City Manager to work with our legal staff to prepare an ordinance to proceed; Mr. Sabatino seconded the motion. Mr. Sabatino, Mr. Smith, Mrs. Hammond, and Mr. Fix voted “Aye.” Motion carried, 4-0.

Mr. Kevin Futryk gave a brief presentation regarding the Central Ohio Municipal Alliance and stated he would answer any questions anyone might have on the Alliance. Mr. Smith inquired if the Alliance coordinated with the Ohio Municipal League in any way, and Mr. Futryk stated they do work with the Municipal League. Mr. Smith further inquired if there were times when the Alliance would take an opposing view to the Municipal League, and Mr. Futryk stated at times the Municipal League may remain neutral while the Alliance will work for Central Ohio communities. Mr. Smith further clarified the dues to the Alliance are based on population and Pickerington’s dues would be $2,500. Mr. Futryk stated currently the 2007 members include the City of Columbus, City of Upper Arlington, City of Dublin, City of Powell, Delaware, Westerville, and Gahanna. Mr. Smith clarified that Mr. Futryk has been in discussion with the Mayor of Lancaster, however, they have not joined the Alliance as yet. Mr. Fix stated it sounded like the Alliance and the Municipal League would be lobbying on behalf of the same issues for the same clientele. Mr. Futryk stated to some degree that was correct, however, there have been other issues where the approach of the Alliance was a little different than that of the Municipal League. Ms Gilleland stated no action was required by the Committee this evening, she just wanted everyone to have the opportunity to meet Mr. Futryk and allow him to brief them on what the Alliance does.

Mr. Smith stated if there were no objections, he would like to address the appeal of the impact fees at this time. All committee members concurred.

Mr. Hansley stated Mr. Ricketts was present to address Item 7.A.(2), Review and discussion regarding Windmiller Office Condo and Barnyard Primitives, Inc., appeal of impact fees. He stated he had provided a copy of the ordinance that shows the finding he would be asking them to come to.

Mr. Richard Ricketts stated he was present representing the two property owners and he provided a packet of information for all committee members and a copy for the record. Mr. Ricketts stated he did not understand, procedurally, exactly how this should move forward. Mr. Ricketts stated there has been a substantial amount of time since the implementation of impact fees, the actual starting of projects, and his clients appearing this evening. He stated he is seeking to explain why he felt these two clients should get some adjustment to their impact fees. Mr. Ricketts stated in both cases he would be seeking this Committee’s consideration of various reasons under the legislation as to why there should be some rebate or adjustment to the impact fees that were assessed to these two projects.

Mr. Ricketts stated he would like to review the reasons they were requesting a rebate of part or all of the impact fee paid by Barnyard Primitives, which is in the amount of $23,750, and for Windmiller Office Condos, who paid an impact fee in the amount of approximately $15,900. Mr. Ricketts stated he believed there were three main methods by which Council and staff can consider the process of moving forward for an equitable adjustment of the impact fees. He stated the first would be inapplicability, and he would review the portions of the legislation that deal with when a project is simply not subject to an impact fee. He continued the second general basis for a credit, abatement, or refund is associated with a development agreement, and the third is known under the legislation as being an “exemption.”

Mr. Ricketts stated he would refer to the portion of the legislation dealing with Section 1486.01(b), that refers to public facilities. He stated public facilities is a defined term, however, it is an important defined term. He continued that he felt the intent of impact fees was to try and provide for equitable and reasonable amounts to fund public facilities, and a public facility is defined as specifically relates to a capital improvement. It is something that would be capitalized in accordance with generally accepted accounting principals, and specifically excludes costs associated with the operation, repair, or maintenance of public facilities. Mr. Ricketts stated he thought many people view the impact fee to do exactly what that says it cannot do; help defray the costs associated with the operation of police, the operation of street department, the operation of utilities. He stated he would suggest that either Council should clarify the intent of this particular provision or work with it as it is written and say that if the new development does not have a new public facility, a new capital improvement cost associated with it to the City of Pickerington, then it is, by definition, inapplicable to the project. Mr. Ricketts stated with these two projects, there were no new roads, there were no new utilities, there is nothing the City has had to expend from a capital expenditure basis. He continued he could understand if Council felt that is not what they intended, it was unfair and would it ever apply if they took that definition. He stated some municipalities have applied a “fair share” approach where they contribute to the applicable part of a project, such as a road widening or main sewer line, where everyone that is going to benefit contributes in a fair share fashion. He stated he felt this approach would probably eliminate the highest percentage of commercial projects from the implementation of an impact fee and he would ask for Council’s consideration that these two projects should be exempt. He stated if Council did not think that is what the intent is, it may be something they should revisit as part of some possible modifications to the impact fee ordinance.

Mr. Ricketts stated the second thing he would like to talk about relates to development agreement. He stated both of these projects were “in the pipeline” before impact fees were even discussed. He stated, as an example, if someone wants to develop in the City they would come in and ask what the City would do for them if they relocated and brought in 20 new jobs and a $2 million structure. He stated there would be discussion about whether or not that business should be entitled to get any concessions for economic development or not. He continued the difficulty these two applicants face is that both of these businesses did work on their site at the request of the City of Pickerington, or in conjunction with their project, that benefited the City of Pickerington and its residents. He stated by doing improvements that were not required by Code, but they did to help the City. He stated these applicants did not have the opportunity to negotiate with the City because they had already bought the property and they were already locked in. Mr. Ricketts stated he felt there was an interesting dichotomy here, because people coming in from another municipality will always come in with their hand out. He stated these are two projects with the owners being residents of the City, and it is amazing the number of times that your own people don’t come in with their hand out. He stated they are your residents, they support you more than anyone, and they come to the table and do more for you than people from the outside. He stated just because they don’t come and ask for something that we should penalize them; we should look at our own favorably, and if we get a good project we should be trying to foster that relationship.

Mr. Ricketts stated the third area he would discuss does, in fact, relate to exemptions. He stated Section 1486.08 (a)(1)A., B., and C., were well done, and was fairly broad. He stated his clients want to provide and encourage employment growth and economic development, and he hoped Council would have a broad view of when an exemption should be applied. He stated the City may exempt all or part of the impact fees for either extraordinary economic development or employment growth. Mr. Ricketts stated he felt there were four things Council needed to consider; first the specific development being proposed, the specific site being considered, the public good, and the intangible benefits the development brings to the City.

Mr. Ricketts stated with respect to Barnyard Primitives, the location is behind the Kroger on Hill Road. He stated this is a nice developed project that is in an area where they are providing substantial economic development but is not necessarily a location that would be developed by a major developer. He continued he had also provided the background on the real estate taxes that currently exist on this project. Mr. Ricketts stated he was requesting consideration of adjustments of their impact fee based first on the public facilities argument. He stated sewer was already there, the road was already there, there was effectively nothing in the context of a capital improvement the city needed to put in in order to bring development to this site and he felt that brought this project outside the scope of impact fees. He continued this piece of ground was purchased in 2004, and as she began the process of moving forward with her business, impact fees were not even on the radar screen at that time. He stated the impact fee is five percent of her entire budget on this project, and he did not feel that was equitable. Mr. Ricketts stated further he did not want to put this in the context that the zoning board and/or staff were doing anything wrong, but it is a reality that many times the requests of staff and/or the zoning board are in excess of Code requirements and many times there is a prior sin that someone is trying to clean up and the next guy coming in gets stuck with trying to clean it up. He stated in this particular instance we have about $50,000 in additional costs to try and satisfy the City’s engineering firm’s request to meet engineering requirements to meet a 100 storm when that was not in the Code at that time. Mr. Ricketts stated if this had been a normal situation, that is when the developer would have met with staff and negotiated these items, and that was unable to happen here because we didn’t have the process to be able to do it. Mr. Ricketts stated he had provided an economic analysis of this project and in the last half of 2006, Barnyard Primitives is doing much better than originally projected, however, there has also been some delay and expense because the process takes longer than anyone expects so the business did not open until later than planned. He stated the economic impact to the City in terms of income taxes of one percent should be approximately an additional $4,000 a year that the City would not have had, and the City will also get an additional amount of real estate taxes because the bare lot has now been developed. He stated he would request Council consider abating all or part of the impact fees that have already been paid by Ms Robertson in connection with the Barnyard Primitive project.

Mr. Ricketts stated with regard to the Windmiller Office Condo project, he felt this project leaned toward an entire abatement of the impact fee for many reasons. Mr. Ricketts stated this project is along Refugee Road, and if everything moves as planned there will be two additional buildings to the one that is complete. He further stated he had provided the real estate information on this project as well. Mr. Ricketts stated the first building has been built and laid out as professional offices, and based upon the amount of square footage, it will probably add in excess of 40-50 jobs when filled out. He stated he would then estimate those jobs would generate approximately $16,000 per year in income tax to the City, in addition to the increased real estate tax it would generate. Mr. Ricketts stated everyone knew curb cuts on Refugee Road were being minimized, and this building was developed by utilizing a private road that will service three buildings. He stated this is a private road the City will never have to maintain and was built to the City’s specifications, and there is no curb cut to Refugee Road.

Mr. Ricketts stated when looking at these two projects, he felt there was a strong bases for providing either a full or partial abatement of the impact fees. He stated he realized this would essentially set a precedent, however, Council needs to understand and appreciate all of the dynamics because what they do on any given project will bleed over onto other projects. Mr. Daryl Berry stated as it related to the infrastructure, sanitary lines and water lines, for both of these projects the trunk lines and the main lines to service these projects were done in a fair share and are going to be paid for by the developer so there should be no impact to the City for those. He stated he had also been asked to sign a TIF so the City could collect money from his development for the realignment of Diley Road.

Mr. Ricketts stated to summarize there are individual facts associated with each of these projects, but he felt for the reason that there were no public facilities associated with these projects and he felt that meant they were outside of the impact fee legislation and the full amount should be adjusted back to them. He stated further he did not feel City residents should be injured because they got caught in the pipeline. He stated if, in fact, these businesses had known of the impact fees and known of the concept of negotiating a development agreement, they would have negotiated what the amount of the adjustment of the impact fee would be. He continued that although everyone has an interpretation of what is substantial economic growth, this is good economic growth for the City. Mr. Ricketts stated there is no question these businesses increase jobs so there is economic growth and he felt Council should consider abating these impact fees in total.

Mr. Ricketts stated as a taxpayer and resident of the City he felt Council would be doing the right thing by abating these impact fees. Mr. Ricketts stated he has no opposition to impact fees provided we do not stunt economic growth, and he was concerned that these fees would be hard on a business. Mr. Ricketts stated as a taxpayer of the City he would think there are very few businesses that are coming in with a good project that should not be considered for complete abatement of the impact fee.

Mr. Smith stated he is sympathetic to the points raised by Mr. Ricketts, however, he did not feel there would be a decision made by the Committee this evening. He stated the decision would set a precedent and he felt Council should be deliberate on how they proceeded. Mr. Smith stated if he recalled there was a logical process for a reimbursement of impact fees, but with an abatement there were questions on the process. Mr. Hansley stated if Council were to give a partial or full waiver, he thought the economic development argument would apply, where Council would take action and it was done. Mr. Fix stated he recognizes that impact fees play a part on a businesses decision on where to go and where not to go, however, retail will go where retail will work and if an impact fee is a part of the equation you factor that into the equation when you are putting together the business plan. Mr. Fix stated he does disagree with Mr. Ricketts on some points, and to state that unless there is a direct an immediate public facilities impact that impact fees should not be gathered he did not feel was the intent of the legislation. He stated over time there certainly will be an impact based on the traffic on Refugee Road that is generated by these two developments. He stated we are already faced with traffic issues on Refugee Road that will cause the City to spend a considerable amount of money over the next few years to maintain traffic flow, and the more we add to Refugee Road the more urgent that need becomes and the more urgent that expenditure becomes. So, in his opinion, he believed there was an impact. He stated on the development agreement side, he understood the parcels were purchased before impact fees were in place, but the question Council had to answer is where did they draw the line. Mr. Fix stated Council put the impact fees in place on a specific date and anyone who was developing on that date is subject to the impact fees. Mr. Fix stated Mr. Ricketts had stated there was not a process to put together a development agreement and he has an issue with that because Ms Gilleland was here and she was acting as our development director, so that opportunity did exist. Mr. Fix stated with regard to the exemption for economic development, he does have a hard time putting impact fees on commercial developments other than retail developments, because retail will go where the money is and retail does have a direct and immediate impact on the community. Mr. Fix stated this is a very difficult question and one Council has to spend some time on because it does have far-reaching implications and will set a precedent. Mrs. Hammond stated for the most part she agreed with Mr. Fix and she felt this was a difficult decision. Mrs. Hammond stated she also felt that in some form the process was working prior to hiring a development director. Mr. Sabatino stated when this legislation was passed, he was very vocal about his opposition to commercial being included because he felt it would be counterproductive to our efforts. Mr. Sabatino stated further that Barnyard Primitives had expressed concern to him and he had forwarded those concerns to Ms Gilleland. He stated what we need as a community is a diverse base of economic development and these types of projects will be beneficial to the City over time and should be considered when debating abating or not abating these impact fees. Mr. Smith stated Mr. Ricketts had made three points that rang true to him; local residents doing local development that is beneficial impact on the City. Mr. Smith stated he thought staff would want some time to consider tonight’s discussion prior to making a recommendation, and Ms Gilleland stated she would like to have time to review the documents presented this evening. Mr. Smith stated he would like to continue this issue as an agenda item to the next Finance Committee to allow staff to provide a recommendation to the Committee members. Ms Gilleland stated she and staff would review the information and provide a recommendation for the next meeting. Ms Gilleland stated she would like to remind everyone that the attorney in St. Louis, who is the impact fee expert, cautioned us on the application of the impact fees, waiving or rebating impact fees, and getting the City in a situation where we would be in a discriminatory situation by waiving the fees of one business and not the fees of another business. She stated further there is also a provision in the legislation that if we do waive fees the City will need to reimburse those fees so the appropriate impact fee is eventually realized.

Mr. Ricketts stated he would like to point out that the location of Barnyard Primitive is not one of the key pieces of real estate, but they did develop in what has already turned out to be a successful retail location even though it is not an ideal retail scenario. Mr. Ricketts further stated he did not want to suggest that Ms Gilleland was not approachable to discuss a development agreement, but there was not an understanding about coming in and negotiating a development agreement and impact fees because that is not the way local businesses did business in the City of Pickerington.

Mr. Smith stated he would like to take a brief recess prior to continuing with the agenda. Finance Committee recessed at 9:40 P.M., and reconvened in open session at 9:50 P.M.

5. FINANCE DIRECTOR:

A. Review and request for motion to approve draft ordinance amending the 2006 appropriation, Ordinance 2006-164. Mrs. Fersch stated a draft appropriation ordinance had been distributed to the Committee members and she would be happy to answer any questions anyone might have on these appropriation requests. Mr. Sabatino questioned how the demolition of Diley Road properties could be classified as a Street Fund expenditure, and Mrs. Fersch stated the purpose is for right-of-way and construction of the street so it is street related. Mr. Sabatino inquired why it would not be part of the Diley Road project, and Mrs. Fersch stated these are funds that will not be under the reimbursement. Ms Gilleland stated Mrs. Fersch was trying to borrow less, we can add funds to the $8 million we will be borrowing. Mr. Sabatino stated he felt that expenditure belonged under Diley Road because it is caused by the Diley Road project. Mrs. Fersch stated we could transfer $25,000 from the General Fund into the Diley Road Fund to make up the difference. Mr. Sabatino stated that is what he would like to see and Mrs. Fersch stated she would make that adjustment. Mr. Smith moved to approve the draft ordinance with the change requested by Mr. Sabatino and forward to Council; Mr. Fix seconded the motion. Mr. Smith, Mr. Fix, Mr. Sabatino, and Mrs. Hammond voted “Aye.” Motion carried, 4-0.

B. Finance Director’s Report: Mrs. Fersch stated she had provided a written report and she would answer any questions.

(1) Impact Fee Report. Mrs. Fersch stated in January we collected $41,809.89 in impact fees. Mr. Sabatino inquired if there was a break down on commercial versus residential, and Mrs. Fersch stated the report reflects 11 residential but not the dollar amount. Mr. Fix clarified that 100 percent of the impact fees collected in January were from residential.

(2) Investment Report. Mrs. Fersch stated Star Ohio interest rate has not changed and we are still earning around five percent. Mrs. Fersch stated she received the bids today on our $8.6 million bond anticipation notes and the net interest cost, because they paid us a premium, is 3.847 by Commerce Capital Markets in Philadelphia. Mrs. Fersch stated it proved very beneficial to have done this on the Internet.

(3) Review of Vendor Report. Mrs. Fersch stated the Committee had received the Vendor Report and she would be happy to answer any questions. Mr. Smith inquired if this report can be e-mailed to everyone rather than a hard copy. Mrs. Yartin stated she would e-mail it next month and if anyone wanted a hard copy she would provide it to them. Mr. Smith stated he would like to try this next month and see how that worked.

(4) 2006 Auditor Selection – Update. Mrs. Fersch stated two firms submitted bids to do our audit and the bid was awarded to Wilson, Shannon & Snow and the cost is less than when the State Auditor’s office performed our audit. Mrs. Fersch stated they will begin around the first part of March.

C. Review and request for motion to approve draft resolutions to request advance distribution of tax monies of the 5.5 mill Police Operating Levy and 2.3 mill General Operating Levy from the Fairfield County Auditor. Mr. Smith clarified these were the annual resolutions to allow Mrs. Fersch to collect our tax monies. Mr. Smith moved to approve and forward to Council; Mr. fix seconded the motion. Roll call was taken with Mr. Smith, Mr. Sabatino, Mr. Fix, and Mrs. Hammond voting “Yea.” Motion passed, 4-0.

6. PERSONNEL DEPARTMENT: Mrs. Fersch stated she had provided a written report and she would be happy to answer any questions.

A. New Employee Update. Mrs. Fersch stated there were 54 applicants for the administrative clerk part-time position in Parks and Recreation.

B. Health Insurance Update. Mrs. Fersch stated our run-out claims are not coming in as high as we thought and we are hoping that continues.

7. DEVELOPMENT DEPARTMENT:

A. Development Director’s Report.

(1) Rt. 33 Alliance – Update. Mr. Hansley stated they have been meeting about every two weeks and the survey conducted by the firm that will be doing the fund raising indicates before the private sector gives money, they want more involvement. He stated they will be meeting to restructure how the group meets.

(2) Review and discussion regarding Windmiller Office Condo and Barnyard Primitives, Inc., appeal of Impact Fees. Mr. smith stated this was dealt with earlier in the meeting.

8. CHAIRMAN:

A. Review of Legal and Engineering services invoices. Mr. Smith ascertained there were no questions on the invoices.

9. OTHER BUSINESS:

A. Review of draft City of Pickerington Fee Schedule. Mr. Smith stated this item would be continued on the agenda for the next meeting.

B. General Communication to Residents. Mr. Smith stated he would continue this item on the agenda for the next meeting.

Mr. Sabatino stated with regard to the skate park noise complaint that Safety Committee has been reviewing, staff is recommending that sand be placed in the ramps to absorb the sound. He stated once the sand is installed we will notify the Huntwork family that it has been done. Mr. Sabatino stated the City has made many efforts to address the Huntwork’s concerns, but yet we also need to be responsible to the benefit of our City’s youth. Ms Gilleland stated she would like to thank Mr. Sabatino for his involvement in this situation as well.

10. MOTIONS:

A. Motion for Executive Session under Section 121.22(G)(1)(b), Matters involving an employee’s or public official’s employment, Section 121.22(G)(2), Purchase or sale of public property, Section 121.22(G)(3), Conference with law director regarding pending or imminent court action, and Section 121.22(G)(4), Matters involving bargaining sessions with public employees. Mr. Smith stated there was no need for an Executive Session this evening.

11. ADJOURNMENT. There being nothing further, Mr. Fix moved to adjourn; Mr. Sabatino seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Smith, Mr. Fix, and Mr. Sabatino voting "Yea." Motion passed, 4-0. The Finance Committee adjourned at 10:25 P.M., February 21, 2007.

RESPECTFULLY SUBMITTED:

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Lynda D. Yartin, Municipal Clerk