Council Meetings - 6 February 2018

The agenda for the Work Meeting seems pretty heavy, whereas the Council Meeting agenda is fairly light. Sometimes agenda items come with all of the material that will be presented already in the document packet, sometimes there are no associated documents. Most items being heard tomorrow only have a descriptive paragraph, which makes it harder to give a meaningful preview.

I'd say that the most interesting items are the two requests for less-common tax-increment incentives, the proposed apartment complex on South State Street, and the proposed changes to the major home occupation regulations.

PROVO MUNICIPAL COUNCIL
Work Meeting Agenda

12:00 PM, Tuesday, February 6, 2018

Work Meetings are designed to be a less formal venue for discussion among Council Members. Generally, no public input is taken during the meeting.

Business

1. An introduction of Karen Larsen, recommended Director of Customer Service (18-020)
   An ordinance was passed on January 23, 2018, creating the Department of Customer Service. It was previously a division under the Mayor’s office. Mayor Kaufusi is recommending the appointment of the current division head, Karen Larsen, as the department director. Consent of the Council is required for these appointments. This will be voted on in the regular Council meeting. Ms. Larsen has worked for Provo City for almost 30 years and aptly lead the Customer Service Division through its transition to the point now where it is ready to become its own department. I have full confidence in her. Presentation only. This item was already scheduled for the February 6, 2018 Council Meeting She'll (continue to) do great.
2. A presentation on the Provo Library and potential budget requests (18-005)
   The Council has asked to hear from various departments and have them share information on likely budget requests in advance of receiving the tentative Provo City budget in May. I served on the Library Board last year so I'm more aware of their challenges and budgetary needs than I would be otherwise. If you haven't checked out the library and the many services and events that they offer, you are missing out. Presentation only. The Library is funded through a separate property tax levy that residents voted for decades ago. The tax rate has fallen ever since then, due to (basically) inflation. They are still making the budget work and are properly maintaining their assets. The Library is an important part of our community and serves us well.
3. A presentation on the Administrative Services Department and potential budget requests (18-005)
   The Council has asked to hear from various departments and have them share information on likely budget requests in advance of receiving the tentative Provo City budget in May. This is similar to the last item, except I am not as familiar with what is going on in this department. Presentation only. I was impressed by the breadth that this department covers: Information Services, Justice Court, Recorder's Office, Facilities, Human Resouces, and Finance. I hope I didn't miss anything.
4. A discussion on a post-performance sales tax increment agreement at East Bay Shopping Center (18-021)
   The Economic Development Department will present an overview and proposal for a potential sales tax increment agreement with the new owners of the East Bay Shopping Center in order to provide retail incentives to offset certain costs in attracting new tenants to the shopping center. The new owners will be present at the meeting to answer questions. The purpose is to work with the new property owners of the East Bay Shopping Center to create an incentive agreement to backfill historically vacant storefronts. The model for this incentive would be similar to that used at the Parkway Village located on University Parkway. The agreement would allow the owners to recoup up to half of their out-of-pocket expenses and then share additional tax revenue if additional time remains on the term of the agreement, up to actual costs. Development and commercial incentives can be powerful tools to create aspects of the community that wouldn't otherwise exist. The right incentive can create the right development or bring in the right anchor which draws in additional development or offerings. Done right, incentives return far more value than they cost. Done poorly, they simply increase the profit margin for a project that was going to happen anyway or displace another project that would have happened, that may have been more viable. The difficulty is in differentiating between the two. Savvy business leaders will make the case for why incentives are needed, whether they are or not.
   
   We approved an incentive for Parkway Village a year ago to help offset the cost of moving a building that allowed for a reconfiguration of an intersection. I believe we were told that the Provo used last used a sales-tax increment incentive 20 years ago. Now we are considering one a year later. Is this really a tool that we should be using more often? Presentation only. This item will be heard at the February 20, 2018 Council Meeting. As I mentioned in the preview, I think tax increment incentives should not be over-used. We need to use them surgically to get the maximum impact at the lowest cost to the City coffers. When I tried to probe during the meeting I was reminded (rightly so because I had forgotten) that months ago the Council broadly signaled that we would be open to this kind of financing to attract the right kind of anchor to the area.
   During the discussion, an industry player stated that they operate up and down the Wasatch Front and estimated that 85% of localities are offering these types of incentives. He said this to assure the Council that we are not considering something that is unusual. But this is one of the main reasons that I struggle with the almost ubiquitous use of tax-increment incentives. If no one offers them then everyone is level in this regard. If 15% of cities offer them then those 15% really stand out and attract a lot of interest. If 85% offer them then it is the remaining 15% that stand out (and not in a good way) and are ignored by developers and brokers. If 100% of localities offer incentives then nobody stands out and everyone is level again. So what's the difference between 0% and 100%? Millions and millions of dollars are diverted away from the services cities provide.
   
   I absolutely believe that tax-increment financing is an important tool, when used correctly. I don't believe Provo is at fault in the over-use and zero-sum arms race with other communities. We are just starting to play catch up. Instead of trying to outcompete other cities by giving away more than they can, I hope we can be part of the solution in restoring some sanity in this area by cooperating with surrounding communities.
5. A discussion on aid to Construction Transfer Funding (18-024)
   An existing Provo Power customer is interested in expanding a data center in Provo, but requires a substantial amount of work to build up the electrical system for their needs. Because of the positive impact to the electrical system and the added economic benefit, the staff of the Energy Department has met with the City Administration to discuss options to encourage businesses such as this in the city but also address the possible budget risk. The solution recommended by the Energy Board is to fund upgrade costs for potential high load factor commercial customers by utilizing the 11% general fund revenue transfer. The contract would be for specific customers with a high load factor and paid under a specific term length. Speaking of obscure incentives, I've never heard of using a tax-increment incentive against the portion of our utility fees that are directed into our General Fund. The argument is that if this local business expands here, they will be using significantly more energy, which will help fund our General Fund, so it is in Provo's best interest to offer the incentive to ensure they expand here, rather than relocating somewhere else. On the flipside, if they are going to expand here with or without the incentive, then offering the incentive is just giving away future fees that would have helped fund the City. Presentation only. I feel better about this one because it targets a very particular type of customer who has a utilization rate over 90% (which means they cost the system little compared to the amount that they pay for their electricity). The incentive will be repaid in under two years.
6. A discussion on tools for implementing Westside Policies (17-129)
   At the November 14th Work Meeting, the Council discussed potential Westside policies (TDRs, open-space subdivisions, PDRs, etc.) The takeaway from that meeting was that Community Development staff would develop a land use map and survey farmland-owners on the west side, with the intent to return for a presentation at a Work Meeting in February. Gary McGinn and Bill Peperone have indicated that they are prepared to report their findings to the Council. I am looking forward to the findings, stay tuned for the report of what they actually are. Presentation only. The owners of the land marked in red have indicated that they would like to develop their land within the next five years. Land in green indicates that the owners plan to farm for another 10 years or more.
   
7. An update on affordable housing in Provo (18-023)
   Robert Vernon, Provo Housing Authority, will be proposing that the City and the Housing Authority develop a closer relationship/partnership to promote housing development for different market needs from starter homes to affordable housing. He will inform the Council about the Housing Authority’s current business and future plans and provide information on the state of the workforce housing market. I am looking forward to the presentation and the proposal, stay tuned to find out what will be proposed. Presentation only. Mr. Vernon proposed we develop a closer working relationship and consider some additional tools that the State has allowed cities to authorize housing authorities to use. I believe the City needs a clear articulable vision for what we are trying to achieve in our housing efforts.
8. A presentation on a project proposal for improvements on the south-side hill of Grandview South Neighborhood (18-022)
   The Grandview South Neighborhood is proposing a project to improve a hillside in their area. They are targeting some safety issues as well as appearance. They plan to apply for a matching grant through the Neighborhood Program but think additional funding might be needed. There is a good description of why the project is wanted, but without a map, I'm not exactly sure which hill is being discussed. One question to ask is whether the property is public or private. Presentation only. The hill of interest is north of the round-about on 820 North near Provo College. The land we are talking about is owned by Provo City.
   
   This project will cost a significant amount of money. This is an example of why I feel we need to implement a budgeting for priorities framework. There is no question that this is a good project. But how does it compare with other good projects competing for funding? What project gets cut to do this? Or do we raise taxes to do it?
9. A presentation on the Provo City Charitable Giving Campaign
   Presentation only. Karen Tapahe is leading the campaign for our office. The goal this year is 100% participation. I think we can do it.



Policy Items Referred From the Planning Commission



10. Tim Soffe requests a General Plan Map Amendment from Commercial to Residential for 1.52 acres of land located at 490 South State Street. Maeser Neighborhood (17-0002GPA)
    This is a request to change the General Plan Map designation from Commercial to Residential. The property previously had a greenhouse business and the applicant would like to build a 64-unit apartment complex in its place. We have heard from the prospective neighbors who do not want this project to happen or who are asking for changes to the proposal. Community Development Staff has recommended approval. The Planning Commission has recommended approval, contingent on one of the neighborhood requested changes. Looking that the site plan, I don't like the giant parking lot fronting the neighborhood street with one of the buildings fronting the backyards of existing neighbors. CONTINUED to the March 6, 2018 Work Meeting The applicant requested the delay. It was not discussed in the meeting.
11. Tim Soffe requests a Zone Change from General Commercial (CG) to High Density Residential (HDR) for 1.92 acres of land located at 422-490 South State Street. Maeser Neighborhood. (17-0010R)
    This is a request to rezone a property to High Density Residential (HDR) to facilitate the construction of a 64-unit apartment complex. See the preview of the previous item. CONTINUED to the March 6, 2018 Work Meeting The applicant requested the delay. It was not discussed in the meeting.
12. John & Lara Johnson request Zoning Ordinance amendments to Section 14.41 Major Home Occupations to increase the number of students from 6 to 16 and to extend the hours of operation from 5:00 pm to 9:00 pm. Citywide Impact (17-0025OA)
    This is a request to change the limitations for Major Home Occupations, increasing the maximum allowed students from 6 to 16 and extending the business hours involving an outside employee from 5:00 pm to 9:00 pm. It appears that this proposal has the support of the neighbors, which is really important. The difficulty is that the requested ordinance change would affect the whole city and doesn't have the support of the broader community because of what else it would potentially allow. This item was already been scheduled at the February 6, 2018 Council Meeting. A motion to continue the evening discussion and return the item to the Planning Commission for review was Approved 7:0. The applicants made a significant change to the request after it had been reviewed by Staff and the Planning Commission (and received a negative recommendation). Before deciding on the merits of the new request, we would like Staff and the Planning Commission to review it and update their recommendation.



Closed Meeting



13. The Municipal Council or the Governing Board of the Redevelopment Agency will consider a motion to close the meeting for the purposes of holding a strategy session to discuss pending or reasonably imminent litigation, and/or to discuss the purchase, sale, exchange, or lease of real property, and/or the character, professional competence, or physical or mental health of an individual in conformance with § 52-4-204 and 52-4-205 et. seq., Utah Code.
    Closed meetings (aka executive meetings) are held without the public present and must meet one of the conditions listed above. A closed meeting was held.

PROVO MUNICIPAL COUNCIL
Regular Meeting Agenda

5:00 PM, Tuesday, February 6, 2018

Opening Ceremony

Items in this category do not involve legislative action.
• Neighborhood Spotlight: Joaquin Neighborhood
• Approval of Minutes

Presentations, Proclamations, and Awards

Items in this category do not involve legislative action.
1. A presentation on the Mayor's Award of Excellence
   Presentation only. Nedra Bell was recognized for decades of volunteer service improving mental health education in Provo. Read the Mayor's tweet.
2. A presentation of the 2017 Employee of the Year
   Presentation only. Officer Bushman, of the Provo City Police Department, was recognized as the Outstanding Employee of the Year.



Public Comment

This public comment period is intended to allow comment on matters that do not appear on the agenda. Each speaker will generally be limited to two minutes. Fifteen minutes has been set aside for this comment period.

For items on the agenda requiring a public hearing, time to comment will be provided, after the item is presented, for all those who wish to speak.

For items not requiring a public hearing, public comment will still be taken following presentation of the item, but will be limited to a ten minute total comment period. We had a number of commenters this time. We were invited to the Provo Girls Summit (Marth 8th), lobbied to vote against some proposed apartments, and thanked for some recent sidewalk improvements.



Action Agenda

3. A resolution consenting to the Mayor's appointment of Karen Larsen as the Director Of Customer Service for Provo City. (18-020)
   An ordinance was passed on January 23, 2018, creating the Department of Customer Service. It was previously a division under the Mayor’s office. Mayor Kaufusi is recommending the appointment of the current division head, Karen Larsen, as the department director. Consent of the Council is required for these appointments. From item 1 in the above meeting: "Ms. Larsen has worked for Provo City for almost 30 years and aptly lead the Customer Service Division through its transition to the point now where it is ready to become its own department. I have full confidence in her." Approved 7:0. As I said above, "She'll (continue to) do great."
4. An ordinance amending Provo City Code to clean up inconsistencies and correct references to the Residential Design Standards. City-Wide Impact. 17-0024OA
   Planning staff observed some inconsistencies in residential design standards and prepared this amendment to clarify design regulations. Council heard this amendment at the January 23, 2018, Council meeting and requested information on how this would affect organizations like NeighborWorks and Habitat for Humanity that build homes for low-income recipients. This was heard two weeks ago. Community Development should be returning with additional builder feedback. A motion to send this item back to the Planning Commission after staff revises the design standards in light of affordability concerns was Approved 6:1, with Council member Kay Van Buren opposed. I liked how the motion was first worded, for the Planning Commission to weigh in on the revised design standard proposal, particularly in regards to affordability and quality.
   
   I appreciate Community Development's efforts to reach out to builders for feedback and their willingness to listen and incorporate the feedback. I also hope that they balance the needs for quality and for affordability. I believe that standards that raise the cost of construction by $1 don't necessarily make the project $1 more expensive. Some of that $1 will come out of the cost of land. Land values are dynamic and are based on the profit that can be made from developing or redeveloping the land.
5. A resolution amending the General Plan Land Use Map designation for property generally located at 490 South State Street from Commercial to Residential. Maeser Neighborhood. (17-0002GPA)
   This is a request to change the General Plan Map designation from Commercial to Residential. The property previously had a greenhouse business and the applicant would like to build a 64-unit apartment complex in its place. From item 9 in the earlier meeting, "We have heard from the prospective neighbors who do not want this project to happen or who are asking for changes to the proposal. Community Development Staff has recommended approval. The Planning Commission has recommended approval, contingent on one of the neighborhood requested changes. Looking that the site plan, I don't like the giant parking lot fronting the neighborhood street with one of the buildings fronting the backyards of existing neighbors." CONTINUED to the March 6, 2018 Work Meeting As I reported earlier, "The applicant requested the delay. It was not discussed in the meeting."
6. An ordinance amending the zone map classification of approximately 1.92 acres of real property, generally located at 422-490 South State Street, from General Commercial to High Density Residential. Maeser Neighborhood. (17-0010R)
   This is a request to rezone a property to High Density Residential (HDR) to facilitate the construction of a 64-unit apartment complex. See the preview of the previous item. CONTINUED to the March 6, 2018 Work Meeting As I reported earlier, "The applicant requested the delay. It was not discussed in the meeting."
7. An ordinance amending Provo City Code Section 14.41.060 (Major Home Occupations). Citywide Impact. (17-0025OA)
   This is a request to change the limitations for Major Home Occupations, increasing the maximum allowed students from 6 to 16 and extending the business hours involving an outside employee from 5:00 pm to 9:00 pm. From item 11 in the earlier meeting, "It appears that this proposal has the support of the neighbors, which is really important. The difficulty is that the requested ordinance change would affect the whole city and doesn't have the support of the broader community because of what else it would potentially allow." During the February 6, 2018 Work Meeting, this item was continued. As I reported earlier, "The applicants made a significant change to the request after it had been reviewed by Staff and the Planning Commission (and received a negative recommendation). Before deciding on the merits of the new request, we would like Staff and the Planning Commission to review it and update their recommendation."

Adjournment