CC - Agendas - City Council - REGULAR - 11/4/2008

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Prescott City Council Regular Voting Meeting — October 28, 2008 Page 13 ff Councilwoman Suttles said that if they pass the ordinance with the six- month delay, they are still moving forward. Mayor Wilson said that it would give them another year to look at other alternatives. He said that he would be happy to look at other alternatives. They gave the YCCA to come up with a recommendation, and he did not see one. Councilman Lamerson said that he does hear the experts standing before them telling them that they have significant problems if they don't do some of the work. He understands what they are going to have to do and that if they don't do it, they are not acting in the best interests of the community in many ways. He also understands that in another year they will be looking at raising or lowering impact fees again. His point is that they are using the wrong tool. Councilwoman Suttles said that this year they are looking at 91 building permits, versus hundreds in past years. Mr. McConnell said that Mr. Jackson has pointed out several times that the 91 permits are consistent with the projection of the study for 2008. He said that the question is how fast that permit activity will rebound, which ties back into the bi-annual update because if there is little change in the economy the future permit activity is not going to be 600 permits, it will be much less than that. Mr. McConnell said that another thing to be pointed out is that they must always remember that they go through an annual budget process and update their six-year capital improvement program (CIP). It is entirely true that growth-related capital expenses are financed in the enterprise fund (water or sewer), and the financing source is the ratepayers. They are paid back and will be paid back. If it is the determination of the City that the long- term capital program is too aggressive, that they would be incurring too much debt and it would require too much to pay back, or would not be paid back, then the CIP needs to be delayed. That is done through the annual budget process and the bi-annual update. It is not like the ratepayers are going to be left holding the bag; there are checks and balances. Councilwoman Lopas said that the impact fees are for the new growth. The ratepayers are paying for any maintenance on existing lines, and they are being collected. Mr. McConnell said that is entirely accurate, including that the City of Prescott operates enterprise funds. Those funds are not supported by property tax or sales tax; they are enterprise funds through rates and impact fees. If the City incurs capital debt for growth-related expenses, the money comes from the enterprise fund. The ratepayers advance the monies, but they are paid back. It is a ten-year program, with a ten-year pay back period, and the borrowing for the capital expenses can go out to thirty years.