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11/10/1997 City CouncilEDMONDS CITY COUNCIL APPROVED MINUTES NOVEMBER 10, 1997 The Edmonds City Council meeting was called to order at 7:00 p.m. by Mayor Barbara Fahey in the Library Plaza Room, 650 Main Street, followed by the flag salute. ELECTED OFFICIALS PRESENT Barbara Fahey, Mayor Dave Earling, Council President John Nordquist, Councilmember Roger L. Myers, Councilmember Jim White, Councilmember Dick Van Hollebeke, Councilmember Thomas A. Miller, Councilmember ABSENT Gary Haakenson, Councilmember STAFF PRESENT Paul Mar, Community Services Director . Art Housler, Administrative Services Director Robin Hickok, Police Chief Gary McComas, Fire Marshal Rob Chave, Planning Manager Jim Walker, City Engineer Phil Olbrechts, City Attorney Sandy Chase, City Clerk Mayor Fahey announced that normally the second Tuesday meeting of each month is reserved for Council committee meetings only, however, due to a specific issue that needed to be discussed in a timely manner the Council elected to meet as a body of the whole prior to the committee meetings. COUNCIL PRESIDENT EARLING MOVED, SECONDED BY COUNCILMEMBER MYERS, TO APPROVE THE AGENDA AS PUBLISHED. MOTION CARRIED. . 1. FULL COUNCIL REVIEW (A) DISCUSSION OF POTENTIAL ANNEXATION OF THE PERRINVILLE AND FIRDALE ANNEXATION AREAS Art Housler, Administrative Services Director, addressed the financial basis for the annexation of these two areas. In this annexation, approximately 4,350 citizens would be added to the City, with 1,889 dwellings. It was estimated that approximately 10-t/z employees would need to be added to service this area in order to remain at the level that the City is currently serving the rest of the citizens of Edmonds. Included in the Council's packet this evening is a complete packet of financial information that relates to the cost for staffing and all related costs for intergovernmental services, etc. The packet also included information concerning revenues that are expected to be received in 1998 if the annexations are certified by the Washington State Office of Financial Management by March 1, 1998. Costs and revenues were also annualized for 1999 to give a broader scope of the impact of the annexation over a two-year period. Council President Earling asked for clarification of the time line involved in certification of the annexation. Mr. Housler explained that in order to obtain the certification from the State by March 1, Edmonds City Council Approved Minutes November 10, 1997 Page I 1998, (which impacts the State Shared Revenue), the census of the annexation areas need to be completed by January 31, 1998. Mr. Housler stated that State Shared Revenue is based on population. Council President Earling further inquired about the census. City Attorney Phil Olbrechts stated if the census is not certified by March 1, then the City would need to wait until the following year to levy taxes. Essentially, it delays the City for an entire year in receiving State Shared Revenue. Councilmember Van Hollebeke asked for clarification of the figures used for the Police Department employee needs. Police Chief Hickok explained 4 Police Officers as well as 1 clerk are proposed to be added as a result of these annexations. In 1999.and 2000, one officer per year would be phased in to bring the ratio up to the current status of 1.3 officers to every 1,000 citizens. Chief Hickok stated that federal government money will be used for three officers to help in the initial costs. Councilmember Van Hollebeke also requested clarification concerning figures used for State Shared Revenue. Mr. Housler explained that on the first schedule, there is no equalization tax received. For the year 1999, equalization tax is received on a quarterly basis. Regarding the motor vehicle excise tax, a half-year (or 50%) of this tax is projected for 1998, where 1999 is projected to receive this tax for a full year. Councilmember Miller noted that one point that is not addressed in the Agenda Memo is the fact that both Firdale and Perrinville Annexation Areas voted down the assumption of bonded indebtedness for the new public safety facility. What was the potential revenue that would have been received had they approved the assumption of bonded indebtedness? Mr. Housler responded the existing rate for the citizens of Edmonds on the -public safety bond issue is 25.6¢ per $1,000 of assessed property value. If the annexed areas had voted to accept the debt service, it would have gone down to 24.10 per $1,000 of assessed property value for everyone in the city. That equates to $38,800 (annually) that we would have collected from the two annexed areas that would apply to the debt service on the public safety bond issue: Councilmember Miller commented that he wanted to make sure that the level of staff ratio to citizens is not being reduced overall. Mayor Fahey stated adding the staff indicated in the packet will enable the City to get on track. With the last annexations the City did not add staff because it took the city to a threshold. These new annexations will push the City over the threshold to where the additional staff is needed to see that the needs of all the annexed areas that have taken place over the last couple of years are being met. Council President Earling addressed sales tax issues. In looking at the projected figures for sales tax for these two areas, he noted there is only a $4,000 difference between Firdale and Perrinville. He questioned where all the businesses are in the Perrinville Annexation. Rob Chave, Planning Manager, stated the City requires business licenses for both home occupation businesses and commercial businesses. Some of the businesses that are being picked up in the Perrinville area would fall into the home occupation category. Historically, annexed areas do have quite a few businesses operated out of homes. Council President Earling commented that it does not make sense to him that in an area that is about five times larger than the other, that if there is a proportionate number of home businesses in both areas, how can there be $33,000 in sales tax projected from the larger annexation (Firdale), and $29,000 from the small area (Perrinville). Edmonds City Council Approved Minutes November 10, 1997 Page 2 Mr. Chave stated the number of businesses are provided by looking at Metro Scan. Responding to Councilmember Myers request, Mr. Housler explained that for 1997 the City has a contract with the Fire District where the County pays the City of.Edmonds $1,088 per call into the annexed areas for services (particularly out of Fire Station No. 10). For 1997, $640,000 in revenue is projected from these service calls. For 1998, the $640,000 figure will be reduced by $190,000 as a result of the annexation. Councilmember Miller asked questions regarding the Firdale area and Fire Station No. 10. He noted that Fire Station No. 10 was built by the County with a bond. The residents of the Firdale area are paying bonded indebtedness on that Fire Station at this time. He asked if they will continue to pay that bonded indebtedness even if they come into the City? Mr. Housler responded that is correct; the amount is 7¢ per $1,000 of assessed value for 1997. Council President Earling commented that he is extraordinarily pleased that the residents of Firdale and Perrinville voted to be annexed into the City. It is disappointing that a similar commitment was not there for the bonded indebtedness. The part that is unsettling for him, however, is the question concerning businesses. He expressed concern with the numbers used for the projected sales tax. If the Council waited until next week to receive better information, would it still be possible to meet the dead lines? Mr. Housler stated the sales tax numbers are based on the average amount of sales tax that is received from businesses in the City of Edmonds. The number of businesses in the two annexation areas was provided by Metro Scan. In his opinion, Mr. Housler believes the numbers are reasonable. City Attorney Olbrechts advised the statutes do not provide when the ordinance needs to be passed to annex these areas. The statutes indicate the Clerk needs to provide information as to the election results to the Council at the next regular meeting after the election. The Council then has time to analyze the annexation. Also, there is no requirement as to the effective date of the annexation. Mayor Fahey stated the sales tax revenues that are projected are a calculation or formula. There is no direct information that the businesses in Firdale generate $33,000 in sales tax; the figure was obtained by multiplying the number of businesses in Firdale times $1,840 (the average amount of sales tax generated by Edmonds businesses). Mr. Housler agreed with this statement. He clarified that the businesses on the southeast corner (near the Perrinville Annexation) were not included in the calculations. Councilmember Myers agreed with Council President Earling that the equal number of businesses shown for Firdale and Perrinville does not seem accurate. He suggested approving moving forward with one of the annexations at this time, and come back with further information on the other area. Councilmember Miller asked if the same formula for sales tax revenue was used in previous annexations and were the projections fairly accurate? Mr. Housler responded yes, basically the same formula was used. On a general basis, the percentages projected for sales tax revenue were met. He is satisfied that money was not lost on the annexations. COUNCILMEMBER NORDQUIST MOVED, SECONDED BY COUNCILMEMBER MYERS, TO ACCEPT THE ANNEXATION OF THE F RDALE ANNEXATION AREA INTO THE CITY OF EDMONDS WITHOUT ASSUMPTION OF THE BONDED INDEBTEDNESS AS INDICATED BY A VOTE OF THE PEOPLE. MOTION CARRIED. Edmonds City Council Approved Minutes November 10, 1997 Page 3 Councilmember Van Hollebeke commented regarding the Perrinville Annexation Area. He recognized the concern expressed regarding the number of businesses in that area. He questioned if that is sufficient reason not to move ahead with the annexation? Council President Earling stated having an accurate figure would help him to make a decision. This number could change the potential net outcome of the first year. He pointed out the first year projections show revenue above expenses as $3,200. If there are some calculations that are not correct, it could turn the whole venture from being a marginally quality decision to a decision that (if accepted) the Council would want to anticipate the short fall. Mr. Housler expressed his opinion that 'in looking from the financial aspect, Perrinville is better off coming into the City than Firdale. He pointed out the new staffing costs!relate to Firdale; they are far less for Perrinville. He noted that there are only 650 people who reside in Perrinville, and this area could be absorbed without additional staffing. Councilmember Miller commented that the Finance Director has indicated that he has obtained the best numbers that are available at this point. The costs are related to Firdale and not Perrinville. COUNCILMEMBER MILLER MOVED, SECONDED BY COUNCILMEMBER VAN HOLLEBEKE TO ACCEPT THE PERRINVILLE ANNEXATION AREA INTO THE CITY OF EDMONDS WITHOUT ASSUMPTION OF BONDED INDEBTEDNESS AS INDICATED BY A VOTE OF THE PEOPLE. Councilmember Van Hollebeke agreed with Councilmember Miller's comments. Although the exact distribution of the businesses may not be 100% accurate, he believes the numbers are still basically solid. He believes Perrinville would be a great addition to our City. Councilmember White inquired about the practicality of dividing the census taking between the two areas. Would it be possible to begin with Firdale if Perrinville is delayed a week? City Clerk Sandy Chase stated it is intended to begin the census on February 19 when the election is certified. The consultant is preparing for the census and will be conducting training this coming weekend for the census takers. Councilmember Myers stated he would like to know the exact number of businesses in Perrinville. He will not be able to support the motion as he does not feel waiting an additional week would be detrimental. Responding to questions, Ms. Chase indicated waiting another week would still allow the completion of the census in a timely manner. It would be possible to begin with the Firdale Annexation census. Perrinville is a smaller portion of the total project. City Attorney Olbrechts stated that if the census project was begun for Perrinville, and the Council decided not to accept Perrinville, it would be possible to terminate the contract and pay only the amount of work that was completed. He does not believe it would be a major financial investment. COUNCILMEMBER MYERS MOVED, SECONDED BY COUNCILMEMBER VAN HOLLEBEKE TO EXTEND THE DISCUSSION. MOTION CARRIED. Mayor Fahey commented the City gave the perception that the City was willing to accept the Perrinville Annexation area. She does not recall that anything was ever said that acceptance of the area hinged on how much retail sales tax generating capability was in that area. There was no expectation that this area Edmonds City Council Approved Minutes November 10, 1997 Page 4 would put undue burdens on the city in terms of providing services. She believes the question to be answered is does the City let the residential community become a part of Edmonds as they desire if there is not the retail space to support it? Mayor Fahey restated the motion: MOVED BY COUNCILMEMBER MILLER, SECONDED BY COUNCILMEMBER VAN HOLLEBEKE, TO ACCEPT THE ANNEXATION OF PERRINVH.LE AS APPROVED BY THE VOTERS RECOGNIZING THAT THEY VOTED AGAINST ASSUMPTION OF THE BONDED INDEBTEDNESS. A roll call vote was taken: Councilmembers Van Hollebeke, Miller and Nordquist voted yes; Councilmembers Earling, Myers and White voted no. Due to the tie, it was necessary for Mayor Fahey to vote. Mayor Fahey commented she would like to see the residential area of Perrinville become a part of the City. Although, she does not wish to vote against the Councilmembers who would like to become more comfortable with that decision by having more adequate information. Mayor Fahey stated she believes the total number of businesses are there to support the sales tax. Therefore, Mayor Fahey voted in favor of annexing Perrinville into the City of Edmonds. MOTION CARRIED. City Attorney Olbrechts advised that the ordinances still need to come before the City Council to make the annexation final, and four votes are required to make it pass. City Clerk Chase stated hearings have been scheduled on November 25 when the ordinances will be presented. With no further business, the Council meeting was adjourned to Committee meetings at 7:50 p.m. BARBARA S. FAHEY, MAYOR SANDRA S. CHASE, CITY CLERK Edmonds City Council Approved Minutes November 10, 1997 Page 5 AGENDA ` EDMONDS CITY COUNCIL Plaza Meeting Room - Library Building 650 Main Street 7:00 -10:00 p.m. SPECIAL MONDAY MEETING NOVEMBER 10, 1997 The City Council will first meet as a full Council beginning at 7:00 p.m. The Council will then meet separately as committees in different meeting rooms as indicated below. The three City Council committee meetings are work sessions for the City Council and staff only. The meetings are open to the public but are not public hearings. 7:00 P.M. - CALL TO ORDER FLAG SALUTE 1. FULL COUNCIL REVIEW (Large Plaza Meeting Room, Library Building, 650 Main Street) (A) (3o Min.) DISCUSSION OF POTENTIAL ANNEXATION OF THE PERRINVILLE AND FIRDALE ANNEXATION AREAS ADJOURN TO COMMITTEE MEETINGS 2. PUBLIC SAFETY COMMITTEE (Small Plaza Meeting Room, Library Building, 650 Main Street) (A) (3o Min.) REVIEW OF SKATE BOARDING IN THE CITY (B) (20 Min.) UPDATE - FIRE DEPARTMENT ORGANIZATIONAL STRUCTURE (C) (20 Min.) UPDATE - POLICE DEPARTMENT ORGANIZATIONAL STRUCTURE (D) (15 Min.) REPORT ON EMERGENCY MEDICAL SERVICES 3. COMMUNITY SERVICES COMMITTEE (Large Plaza Meeting Room, Library Building, 650 Main Street) (A) (2o Min.) REVIEW OF UPDATED SNOHOMISH COUNTY RECYCLE PROGRAM (B) (20 Min.) PERRINVILLE SEWER CAPITAL IMPROVEMENT (C) (5 Min.) UPDATE ON VIRTUAL REALITY 4. FINANCE COMMITTEE (Anderson Center, 700 Main Street, Room 113) (A) (10 Min.) REVIEW OF AGREEMENT FOR OFFICE SUPPLIES, FURNISHINGS AND EQUIPMENT PURCHASING (B) (20 Min.) TERMINATION OF VEHICLE LIFT CONTRACT AND DISCUSSION TO CONSIDER THE SECOND LOWEST VEHICLE LIFT BID (C) (20 Min.) DISCUSSION OF PROCEDURE TO RECEIVE COMMUNITY REQUESTS FOR BUDGETING PURPOSES (D) (10 Min.) FINALIZE THE MISSION STATEMENT/JOB DESCRIPTION OF THE FINANCE COMMITTEE (E) (5 Min.) APPROVAL OF PETTY CASH EXPENDITURES FOR THE MONTH OF OCTOBER 1997 Parking and meeting rooms are accessible for persons with disabilities. Contact the City Clerk at771-0245with 24 hours advance notice for special accommodations. The Council Agenda appears on Chambers Cable, Channel 32. 1