Tough decisions in troubling times
By Linda Bentley | November 26, 2008
With the challenges comes opportunities
CAVE CREEK – Town Accountant Marian Groeneveld provided council with an overview of the town’s financial status during Monday’s council meeting.
While Cave Creek usually stands out from the crowd, Groeneveld said the economy was affecting Cave Creek as well this time.
Sales tax and construction taxes were up slightly, retail and restaurant sales taxes were down, but building, planning and engineering fees were only coming in at 10 percent and development fees at 5 percent of the town’s most conservative estimates.
Groeneveld pointed out reduced operating costs of water services by taking over operations and billing from Arizona American. The challenge, she said, is to have water fees pay for operations without development fees.
Attorney Fred Rosenfeld explained the proposed Water Infrastructure Finance Authority (WIFA) loan agreement that would allow the town to move forward on the new wastewater treatment plant, known as the Water Ranch, with the first interest payment due Jan. 1, 2010 and the first principal payment due Jan. 1, 2011, to be paid with the various excise taxes collected by the town and development fees.
Councilman Dick Esser asked what would happen if the town were to default on the loan.
Rosenfeld responded, “They can attach your state tax revenue,” adding, “You don’t want to default.”
During public comment, Ralph Mozilo stated the issue was discussed, in depth, at the budget meeting last Thursday and said, although it was a tough decision, “I think it’s imperative you approve this,” citing costs will go up if they wait.
Vice Mayor Gilbert Lopez said, “I support building the sewage treatment plant, we need it … But I can’t go along with something without knowing where we’re going with this.”
Councilwoman Grace Meeth said she had “absolutely no comfort with this,” stating, “We have an unauthorized water master plan and between now and 2030 we have $157 million in commitments.”
Referring to Meeth’s comment about the town having $157 million in obligations, Mayor Vincent Francia said, “I don’t know what bothers me more, building a new sewage treatment plant or putting out misinformation to the public.”
Council voted 5-2 in favor of entering into a WIFA loan agreement in an amount not to exceed $22,917,000, with Meeth and Lopez dissenting.
Council then voted unanimously to approve the design/build contract with Garney Construction at a guaranteed maximum price not to exceed $21,998,637.
Town Attorney Gary Birnbaum gave council an overview of the special use permit (SUP) process, defining it generally as an administrative act that is not referable.
However, even though it is an administrative act, he stated it can still be discretional.
Birnbaum said the town’s zoning ordinance allows for some discretion, whereas some ordinances make SUPs a ministerial action, which allows for no personal discretion, only the strict following of law.
Birnbaum said the best way to determine if something is a legislative act versus an administrative act is to ask if the act is creating a policy or if it is implementing a policy created by the zoning ordinance.
Francia said council will bring the SUP issue back, stating it needed more discussion.
The next agenda item, according to Esser, was “the perfect example of an SUP gone wrong.”
Council voted unanimously to approve a payment to Arizona Municipal Risk Retention Pool in the amount of $54,707.96 as the town’s share of a $273,539.81 settlement with Jim Langan, owner of Full Circle Bed and Breakfast, who sued the town after it revoked his SUP for failing to abide by the conditions under which it was issued.
Council voted 5-2 in favor of reconsideration of the Branded Bullfrog’s SUP application and 4-2, with Brennan recusing herself, in favor of reconsidering Parkway Bank’s SUP application on a future council agenda, with Meeth and Lopez dissenting.
With the exception of Lopez voting “present,” council voted unanimously in favor of repealing the 2006 resolution creating the monthly stipends of $500 for the mayor and $300 for council members, which, by law, cannot go into effect until the next council term begins on July 1, 2009.
Council voted unanimously in favor of agreements by the town manager to reduce his salary by 10 percent and reduce monthly payments to the town magistrate and town prosecutor by 10 percent beginning Jan. 1, 2009.
Last, council unanimously approved the second reading of the ordinance prohibiting use of motorized vehicles on trails.
Photo: With the wastewater treatment plant operating at over 80 percent of its capacity, Councilwoman Kim Brennan called moving forward with the new wastewater treatment plant during tough economic times a “damned if you do, damned if you don’t” situation, while Councilman Ernie Bunch stated, “This is probably the most difficult decision I’ve had to make.”
Photo by Linda Bentley