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TC Packet 02-09-2016 TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 9, 2016 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:05PM AVON TOWN HALL, ONE LAKE STREET _____________________________________________________________________________________ MEETING AGENDAS & PACKETS: HTTP://WWW.AVON.ORG AGENDAS ARE POSTED AT AVON TOWN HALL, RECREATION CENTER, & LIBRARY. Page 1 AVON LIQUOR LICENSING AUTHORITY MEETING BEGINS AT 5:00 PM (SEE SEPARATE AGENDA PAGE 2) REGULAR MEETING BEGINS AT 5:05 PM 1. CALL TO ORDER & ROLL CALL 2. APPROVAL OF AGENDA 3. PUBLIC COMMENT - COMMENTS ARE WELCOME ON ITEMS NOT LISTED ON THE FOLLOWING AGENDA 4. WORK SESSION 4.1. REVIEW OF REPORT ON TOWN OF AVON SALES TAX ON BUILDING MATERIALS (ASSISTANT TOWN MANAGER SCOTT WRIGHT, TOWN MANAGER VIRGINIA EGGER, TOWN ATTORNEY ERIC HEIL) 5. ACTION ITEMS 5.1. CONSIDERATION OF FOURTH AMENDMENT TO THE INTERGOVERNMENTAL AGREEMENT WITH EAGLE RIVER FIRE PROTECTION DISTRICT TO WAIVE FEES RELATED TO THE CONSTRUCTION OF THE JOINT PUBLIC SAFETY FACILITY (TOWN ENGINEER JUSTIN HILDRETH) 5.2. APPROVAL OF AN INTERGOVERNMENTAL AGREEMENT BETWEEN THE TOWN OF AVON AND EAGLE COUNTY FOR PLAN4HEALTH PROJECT (TOWN ATTORNEY ERIC HEIL) 5.3. RESOLUTION NO. 16-O2, A RESOLUTION INITIATING ANNEXATION PROCEEDINGS AND SETTING A PUBLIC HEARING FOR THE ANNEXATION OF UPPER EAGLE RIVER WATER AUTHORITY MOUNTAIN STAR WATER TANK PROPERTY (TOWN ATTORNEY ERIC HEIL) 5.4. MINUTES FROM JANUARY 26, 2016 MEETING (TOWN CLERK DEBBIE HOPPE) 6. WRITTEN REPORTS 7. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 8. MAYOR & COUNCIL COMMENTS 9. ADJOURNMENT TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 9, 2016 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM AVON TOWN HALL, ONE LAKE STREET CALL TO ORDER AND ROLL CALL 1. APPROVAL OF AGENDA 2. PUBLIC COMMENT 3. RENEWAL OF LIQUOR LICENSES 3.1. APPLICANT: SVO COLORADO MANAGEMENT, INC. D/B/A SHERATON MOUNTAIN VISTA LOCATION: 160 BEAVER CREEK WEST TYPE: HOTEL AND RESTAURANT LICENSE MANAGER: DAVID WEISS 3.2. APPLICANT: FIESTA JALISCO NUMBERO TRES, LLC D/B/A FIESTA JALISCO LOCATION: 240 CHAPEL PLACE B-12 TYPE: HOTEL AND RESTAURANT LICENSE MANAGER: RICARDO ARAGON 4. REPORT OF CHANGES – CHANGE IN MANAGER 4.1. APPLICANT: FIESTA JALISCO NUMBERO TRES, LLC D/B/A FIESTA JALISCO LOCATION: 240 CHAPEL PLACE B-12 CURRANT MANAGER: RICARDO ARAGON NEW MANAGER: JOSE G. RODRIQUEZ 5. MINUTES FROM JANUARY 26, 2016 6. ADJOURNMENT           THE  TOWN  OF  AVON       SALES  TAX  REPORT     ON   BUILDING  MATERIALS     INCLUDING     COLLECTION  DATA,  LEGAL  REVIEW,  TAX  RELIEF  OPTIONS,     FINANCIAL  INFORMATION  AND     ADMINISTRATION  RECOMMENDATIONS     Prepared  for  the  February  9,  2016     regular  meeting  of  the   Avon  Town  Council       Town  Attorney  Eric  J.  Heil   Assistant  Town  Manager  Scott  Wright   Town  Manager  Virginia  Egger   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  3  OF  20   peer   communities,   including   the   Town   of   Breckenridge,   and   explores  methods   of   improving  administrative  procedures  to  promote  greater  awareness  and  compliance  with   the   Town’s   sales   tax   regulations.    From   2012   through   2015,   the   Finance   Department   adopted  improved  administrative  procedures  to  notify  contractors,  sub-­‐contractors  and   suppliers  of  the  Town’s  sales  tax  requirements  and  applicability  of  the  Town’s  sales  tax  to   Building  Materials  delivered  into  Avon.    The  Finance  Department  implemented  MUNIRevs   software  in  2014  and  Town  Council  adopted  revisions  to  business  licensing  regulations  by   Ordinance  No.  15-­‐02.    These  two  actions  expanded  the  Town’s  ability  to  identify  businesses   operating  in  Avon  and  the  Town’s  ability  to  notify  such  businesses  of  Town’s  sales  tax   requirements.    The  number  of  business  licenses  issued  to  out-­‐of-­‐town  Retailers  selling   Building  Materials  in  Avon  increased  from  2010  to  2015  due  to  Town’s  improvements   to  its  administrative  procedures  and  notifications  and  due  to  the  overall  increase  in   building  activity  in  Avon.   The  sales  tax  collected  on  Building  Materials  from  out-­‐of-­‐town  Retailers  as  relates  to   overall  construction  activity  for  years  2010-­‐2015  is  summarizes  as  follows:   EXECUTIVE  SUMMARY  TABLE     OUT-­‐OF-­‐TOWN  RETAILERS  OF  BUILDING  MATERIALS   Year  Number  of  Out-­‐of-­‐ Town  Retailers  of   Building  Materials   filing  Sales  Tax   Reports   Sales  Tax  Collected   from  Out-­‐of-­‐Town   Retailers  of   Building  Materials   Total  Building   Activity  by   Valuation   2010  47  $  44,218.85  $13,021,586   2011  51  $  57,873.18  $  9,334,790   2012  52  $  72,747.72  $13,848,500   2013  85  $100,061.95  $36,149,636   2014  105  $318,821.24  $15,235,900   2015  118  $311,607.95  $34,999,261   Building  Activity  by  Valuation  is  based  on  building  permit  information.    The   purchase  of  Building  Materials  at  retail  and  remittance  of  the  associated  sales   tax  for  such  Building  Materials  may  occur  in  the  succeeding  year  or  later   depending  upon  the  timing  and  progress  of  the  building  project.     Council  has  the  legislative  authority  to  enact  a  variety  of  options  to  exempt,  credit  or   rebate  sales  tax  imposed  on  Building  Materials  generally  or  upon  Building  Materials  sold  by   out-­‐of-­‐town  Retailers  and  delivered  into  Avon.    The  financial  impact  of  not  collecting  sales   tax  on  Building  Materials  delivered  into  Avon  is  dependent  upon  the  level  of  construction   activity.    The  projected  reduction  in  sales  tax  revenue  in  future  years  is  estimated  to   average  $300,000  annually  based  upon  the  amount  of  sales  tax  collected  in  2014  and   2015.       The  Town  provides  a  sales  tax  credit  on  “taxable  transactions”  in  The  Village  (at  Avon)   that  corresponds  to  a  public  improvement  fee  imposed  in  the  Village  (at  Avon).    The  public   improvement  fee  on  retail  sales  is  the  most  significant  revenue  source  for  Traer  Creek   Metropolitan  District.    Legislative  action  to  provide  an  exemption  from  sales  tax  for   Building  Materials  delivered  into  the  Village  (at  Avon)  may  reduce  the  future  potential   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  4  OF  20   revenues  of  Traer  Creek  Metropolitan  District.                       Finally,   uniformity   in   taxation   of   retail   transactions   is   widely   considered   to   be   fair,   efficient,  beneficial  and   preferred,  both   at   the   state   level   and   national   level.    Sales   tax   exemptions  or  tax  relief  which  are  not  uniform  across  Avon  and  other  jurisdictions  can   result  in  a  competitive  disadvantage  for  some  Retailers.   This  Report  is  organized  into  six  sections,  described  as  follows:   I. SALES  TAX  COLLECTIONS  ON  BUILDING  MATERIALS   This  section  includes   basic  terms   and   definitions;  a   chronology   of  the   Town’s   administrative  efforts  to  collect  sales  tax  on  Building  Materials;  a  description  of  the   licensing,   collection   and   reporting   process;  and,   an   overview   of  enforcement   practices.    Also  included  are  examples  of  forms  and  collection  letters  as  attached   exhibits.   II. LEGAL   Town  Attorney  Eric  J.  Heil  addresses  legal  questions  raised  at  the  January  12,  2016,   Council  meeting  regarding  tax  policy  change,  TABOR  issues,  the  2002  Use  Tax  Ballot   question,  Village   at   (Avon)  Annexation   and   Development   Agreement ,   and   legal   considerations  concerning  potential  legislative  options  to  amend  the  Town’s  sales   tax  regulations.   III. SUMMARY  OF  FINANCIAL  INFORMATION   Two  detailed  reports  are  included  in  this  section.    The  first  is  a  summary  of  sales  tax   collections  related  to  Building  Materials  and  the  number  of  return  filers  from  2010-­‐ 2015.    The  second  report  is  a  ten-­‐year  summary  of  building  permit  activity  within   the  Town  of  Avon.    In  addition,  two  credit  ratings  reports,  from  Standard  &  Poor’s   and  Moody’s,  providing  credit  opinions  on  the  Town  of  Avon,  are  included  along   with  a  general  discussion  based  on  their  comments.   IV. LEGISLATIVE  OPTIONS   This   section   identifies   and   discusses   an   array   of   options   the   Town   Council   may   consider  for  a  sales  tax  on  Building  Materials,  considerations  for  potential  outcomes   of  the  option,  and  additional  questions  that  may  be  raised  in  considering  the  action.   V. RECOMMENDATIONS  FOR  SALES  TAX  ADMINISTRATION  IMPROVEMENT   This  section   details  staff’s   recommendations   for  additional   efforts   to   improve   administration  of  the  Town  sales  tax  on  Building  Materials.   VI. EXHIBITS   The  following  Exhibits  referred  to  in  the  above  sections.   1. Exhibit  1  –  Supplier  Verification  Form   2. Exhibit  2  –  Contractor  Letter   3. Exhibit  3  –  1st  Delinquency  Letter   4. Exhibit  4  –  2nd  Delinquency  Letter   5. Exhibit  5  –  Standard  &  Poor’s  Rating  Opinion  Letter     6. Exhibit  6  –  Moody’s  Rating  Opinion  Letter   7. Table  1  –  Sales  Tax  Collections  Related  to  Building  Materials   8. Table  2  –  Commercial  and  Residential  Construction   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  5  OF  20   SECTION  I   SALES  TAX  COLLECTIONS  ON  BUILDING  MATERIALS     Terms  and  Definitions:   • Person  means  an  individual  or  any  recognized  legal  entity.   • Retailer  means  any  person  selling  tangible  personal  property  at  retail.     • Sales  Taxpayer  means  a  person  buying  taxable  goods  from  a  Retailer.   • Business  License  means  a  license  required  by  the  Town  for  any  person  engaged  in   business  in  the  Town.   • Sales  Tax  License  means  the  license  required  by  the  Town  for  any  person  engaged   in  the  business  of  making  retail  sales  within  the  Town.       Chronology  of  Efforts  to  Enhance  Sales  Tax  Compliance     2010     • Electronic  Business  Licenses  &  Sales  Tax  Records  on  File  -­‐  The  Records  Retention   Act,  established  by  the  Colorado  State  Archives,  which  is  authorized  by  Colorado   State  Statute,  and  adopted  by  the  Town  of  Avon,  directs  the  disposition  schedules  of   public  documents.     a. Sales  Tax  Return  Records:  Required  to  be  retained  for  four  (4)  years  after   filing   of   the   return.     Electronic   records   are   currently   on   file   for   years   beginning  in  2010.      Since  2010,  the  Town  no  longer  accepts  paper  returns.     Paper  returns,  prior  to  2010,  have  been  destroyed  in  compliance  with  the   Records  Retention  Act.         b. Business  Licenses:  Required  to  be  retained  for  two  (2)  years  after  expiration.   Electronic  records  are  currently  on  file  for  years  beginning  in  2014.    Prior  to   March,  2015,  only  contractors  and  subcontractors,  with  a  fixed  location  in   Avon,  were  required  to  have  a  Business  License.     • Town  administration  relies  on  Retailers  and  businesses  to  understand  that  business   licensing,   sales   tax   licensing   and   other   regulations   apply  when   commencing  or   engaging  in  business  in  Avon.     • Town’s  website  includes  informational  links  both  on  the  www.avon.org  homepage   under  the  button  “Online  Payments”,  as  well  as  under  the  Finance  Department’s   page.           • Enforcement  is  practiced  on  a  limited  basis  when  license  holders  fail  to  file  a  return,   returns  appear  inconsistent  when  filed,  or  the  Finance  Department  becomes  aware   of  a  Retailer  who  did  not  have  a  Business  License.       SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  6  OF  20     2012-­‐  2013       • Town   hires   new   Accounting   Assistant  –  Additional  duties   included   sales   tax   administration.     • Town   staff   attends   Colorado   Tax   Audit   Professionals   meetings.       Among   current   topics,  discussions  include  how  to  ensure  the  enforcement  and  collection  of  sales   taxes  on  construction  projects  due  to  the  increase  in  building  activity  coming  out  of   the  great  recession.         • Town  staff  researches  the  Town  of  Breckenridge  process,  which  also  has  a  sales  tax   on  Building  Materials  and  no  use  tax.     • Finance  Director  and  Town  Attorney  agree  that  a  process  similar  to  the  Town  of   Breckenridge  for  identifying  suppliers  and  contractors  on  large  building  projects,   called  a  “Supplier  Verification  Form”  should  be  implemented  in  Avon.     • May,  2013  –  Town  of  Avon  Building  Official  notifies  in  writing  all  Building  Permit   recipients   of  the  Town’s  sales   tax   requirements  at   the   time   of   Building   Permit   issuance.    General  Contractors  are  given  a  general  information  letter  and  form  –  see   Exhibits  1  and  2.     • Town  purchases  MUNIRev  software  for  sales  tax  administration.     • Building  Permits   begin   to   increase   with   better   economy.    Wyndham   project   is   approved  and  is  a  significant  construction  project  with  delivery  of  many  Building   Materials.     Town   staff   contacts   the   contractor,  and   subsequently  all   its   subcontractors   and  suppliers,   to  promote   awareness   of   the   Town’s   sales   tax   requirements  and  applicability  to  delivered  Building  Materials.         2014     • Business   License   administration   is   re-­‐organized,   with   the   Finance   Department   becoming  responsible  for  all  aspects  of  Business  License  administration,  which  was   previously  the  duty  of  the  Town  Clerk’s  office.     • Finance  Department  begins  the  process  of  transferring  the  administration  of  the   licensing  into  new  MUNIRevs  software.    This  change  of  administration  oversight   brought  together  all  information  needed  to  identify,  track  and  monitor  businesses   and  sales  tax  remittance.     • The  website  is  updated  to  list  the  MUNIRevs  telephone  number  prominently  on  the   web  page  and  to  describe  the  processes  for  obtaining  a  Business  License  and  Sales   Tax  License.       SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  7  OF  20   2015       • In   March,   2015,   the   Town   Council   adopted   Ordinance   No.   15-­‐02   which  cross-­‐ referenced  the  sales  tax  definition  of  “doing  business  in  Town”  for  uniformity  and   thus  required   anyone   doing   business   in   Town  to   obtain   a   Business   License.     Previously,  only  businesses  with  physical  locations  in  Town  were  required  to  get  a   Business  License.           • The   revision   to   the   Business   License   regulations   in   early   2015  resulted   in  the   issuance  of  Business  Licenses  to  approximately  347  new  businesses.    Many  of  the   new  Business  Licenses  are  related  to  the  building  industry,  including  both  Retailers   of  Building  Materials,  contractors  and  sub-­‐contractors.    Contractors  with  an  address   outside  of  Avon  who  do  business  in  Avon  must  now  obtain  a  Business  License  in   addition  to  obtaining  a  Contractor’s  License.     • Contractors  are  set  up  in  the  MUNIRevs  with  sales  tax  forms  on  either  a  monthly  or   quarterly   basis  (unless   the   Finance   Department   has   been   informed   by   the   contractor  that  the  respective  business  operations  are  not  subject  to  Avon  sales  tax   (i.e.  service-­‐related  only)).    If  there  are  no  taxable  transactions,  a  business  with  a   Sales  Tax  License  must  still  file  a  sales  tax  return  indicating  zero  amount  due.     • For   2015,   the   Finance   Department   has   collected   a   total   of   $76,675   in   Business   License  fees  for  all  businesses  compared  to  $22,300,  in  2014.     SUMMARY:       The  changes  to  the  Town’s  Business  License  Regulations  in  the  Avon  Municipal  Code   and   changes   to   administrative   procedures   along   with   an   overall   increase   in   economic   activity   and   building  activity  have   resulted  in   an   increase  in   the   number   of   Business   Licenses  and  Sales  Tax  Licenses  held  by  out-­‐of-­‐town  Retailers  of  Building  Materials.    The   number  of  in-­‐town  Retailers  of  Building  Materials  has  remained  comparatively  stable  over   the  last  six  years.    The  legislative  and  administrative  changes  over  the  last  several  years   have   resulted   in   a   greater   number   of   Business   Licenses   and   Sales   Tax   Licenses   for   businesses  “doing  business  in  Avon”  have  thereby  advanced  uniformity  in  the  application   of   the   Town’s   sales   tax.      The   change   in   Business  Licenses   and   Sales   Tax   Licenses   for   Retailers  of  Building  Materials  is  summarized  as  follows:     Year  In-­‐Town   Retailers   Out-­‐of-­‐ Town   Retailers   Sales  Tax  from   In-­‐Town   Retailers   Sales  Tax  from   Out-­‐of-­‐Town   Retailers   Total  Building   Activity  by   Valuation   2010  14  47  $166,154  $  44,219  $13,021,586   2011  14  51  $180,254  $  57,873  $  9,334,790   2012  15  52  $258,565  $  72,748  $13,848,500   2013  18  85  $237,766  $100,062  $36,149,636   2014  16  105  $282,976  $381,821  $15,235,900   2015  21  118  $331,503  $311,608  $34,999,261   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  8  OF  20     Process  for  Business  Licenses,  Sales  Tax  Notification,  Collection  &  Enforcement       (May,  2013  –  Present)                                           With   the   implementation   of  MUNIRevs,   the   Town’s   online   licensing   and   sales   tax   collection  system,  obtaining  a  Business  License,  Sales  Tax  License,  filing  of  returns,  and   payment  of  taxes  is  all  accomplished  in  one  place.         • Registration   of   a   business  is  accomplished   through   the   process   o f   obtaining   a   Business   License.     A  Sales   Tax   License   must   be   performed   prior   to   opening   the   business   and   making   retail   sales.     Business   License   fees   vary   depending   on   the   location  and  type  of  business.    There  is  no  fee  to  obtain  a  Sales  Tax  License.     • Detailed   information   and   instructions   for   registration   are   found   on   the   Town   of   Avon  website  (www.avon.org)  under  both  the  Business  License  and  Sales  Tax  links   under   the   Home   Page   drop -­‐down   screen   for   Departments.     In   addition,   there   is   specific  information  regarding  the  collection  of  sales  tax  on  materials  delivered  to   job  sites  within  the  Town.    This  information  has  been  available  since  2014.           • There  are  also  informational  links  both  on  the  www.avon.org  homepage  under  the   button  “Online  Payments”  as  well  as  under  the  Finance  Department’s  page  to  the   MUNIRevs  registration  site.    In  addition,  the  MUNIRevs  telephone  number  is  shown   prominently  on  the  web  page  and  throughout  the  process  for  obtaining  the  Business   and  Sales  Tax  Licenses.     • Once  a  Sales  Tax  License  is  issued,  the  Retailer  must  file  a  sales  tax  return,  which   includes   the  payment   of   tax.     This   process   is  performed   online.    The   Retailer   is   required  to  report  the  amount  of  gross  taxable  sales  made  for  the  reporting  period,   the  amount  of  returned  goods,  and  the  amount  of  retail  sales  that  are  exempt  from   taxation.2       • Sales   tax   returns   are   due   by   the   20 th  day   of   the   month   for   the   sales   activities   occurring  in  the  preceding  calendar  month.    The  Finance  Department  does  allow   quarterly  and  annual  filing  of  returns  for  those  businesses  that  do  not  have  minimal   retail  sales  activity.     • It  is  the  duty  of  each  Retailer  who  obtains  a  Sales  Tax  License  to  keep  and  preserve   adequate   records   of   sales   and   such   other   books   and   accounts   necessary   to   determine  the  amount  of  sales  tax.    Such  books  and  records  of  the  Retailer  may  be   examined  at  any  time  by  the  Director  of  Finance  and  must  be  kept  for  a  period  of   three  (3)  years.3     2  AMC  3.08.120(b)  3  AMC  3.08.200   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  9  OF  20     Enforcement   Enforcement  of  the  Town’s  sales  tax  regulations  generally  follows  these  steps:   1. Written  Notice:    Written  notice  of  a  failure  to  file  is  sent  out  through  the  mail  on   approximately   the   1 st  of   the   month   following   the   due   date   of   the   return.    After   approximately  30  additional  days,  subsequent  mailings  are  sent  out  under  the  Town   Attorney’s  signature  for  failure  to  respond  or  file.    Copies  of  these  collection  letters  are   attached  as  Exhibits  3  and  4.   2. Municipal  Court  Complaint:    If  a  business  does  not  respond  to  the  Town’s  multiple   letter  requests  then  a  municipal  court  citation  is  issued  and/or  a  sales  tax  lien  is  placed   on   a   busine ss.    Often,   the   Sales   Taxpayer   is  instructed   by   the   Court   to   work   out   a   payment   plan   with   the   Finance   Department.     On   only   two   occasions   over   the   past   twenty  years  has  the  Finance  Director  issued  a  distraint  warrant  to  the  County  Sheriff.     A   distraint   warrant   is  an   order   to   seize   and   sell   personal   property   for   payment   of   delinquent   tax  amounts   due.    The   Town   works   cooperatively  with   the   Colorado   Department  of  Revenue  in  matters  involving  collection  of  state  sales  tax  delinquency.     3. Audits:  The   Finance   Direct or   is   responsible   for   examining   returns.     The   Director   performs  an  initial  examination  of  returns  as  taxes  are  remitted  to  determine  if  the   sales  tax  remittance  is  unusual  or  unexpected  considering  the  nature  of  the  business.     The  Director  has  authority  to  order  an  investigation  (i.e.  audit)  of  the  Retailer’s  books.4             Audits   are   sometimes   conducted   as  group  audits   of  large   Retailers  with   other   municipalities.    Audits  may  also  occur  for  a  select  number  of  specific  businesses  within   the  Town.    Businesses  are  selected  based  upon  size  of  the  business  and/or  concerns   identified  by  sales  tax  reports.    The  use  of  audits  is  relatively  rare  in  Avon.    The  Town   has  not  adopted  formal  programmatic  random  audits  for  each  business  category  in  a   manner  similar  to  larger  urban  municipalities.       In  2015,  the  Finance  Department  ordered  audits  of  seven  companies  (none  of  these   audits  involved  any  Retailers  selling  Building  Materials).    Four  of  the  audits  found  that   the  Retailer  was   in   compliance.     The   other   three   audits   resulted   in   additional   tax   assessments  of  $22,549.58.    The  total  cost  of  these  audits  was  $13,919.    The  Town  has   not  conducted  any  recent  audits  of  Building  Materials  suppliers  or  contractors.   An  audit  is  the  only  administrative  procedure  that  authorizes  the  Town  to  obtain   additional  information  on  specific  retail  transactions  beyond  the  general  reporting  of   gross   retail   sales.    Information   obtained   from   audits   is   confidential,   except   that   the   Town  may  publish  statistics  if,  “so  classified  as  to  prevent  the  identification  of  particular   reports  or  returns  or  items  thereof”.5       4  AMC  3.08.170  5  AMC  3.08.200   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  10  OF  20   SECTION  II     LEGAL     SUMMARY:    This  Section  II  –  Legal  has  been  prepared  by  Eric  J.  Heil,  Avon  Town  Attorney.     Avon  Town  Council  met  on  January  12,  2016  to  review  administration  of  the  Town’s  sales   tax   on   building   projects   in   Avon.     Specifically,   Council   discussed   and   reviewed   the   application  of  the  Town’s  sales  tax  to  Building  Materials  sold  by  out-­‐of-­‐town  Retailers  and   delivered  in  Avon.    Several  additional  legal  questions  were  raised  at  this  meeting  which  are   addressed  in  this  Section.       The  conclusions  in  this  Section  II  -­‐  Legal  are  summarized  as  follows:   • Town  staff  has  an  affirmative  duty  to  administer  and  enforce  sales  tax  as  is   legally  permissible.   • A  change  in  administrative  procedures  to  increase  sales  tax  compliance  does  not   constitute  a  tax  policy  change  requiring  advance  voter  approval  where  Town   voters  have  previously  approved  the  Town’s  authority  to  exceed  revenue  limits   set  forth  by  TABOR.   • The  legal  effect  of  enacting  “tax  exemptions”  versus  “tax  credits”  versus  “tax   rebates”  should  be  understood  because  each  results  in  different  restrictions  on   the  legislative  discretion  of  future  Town  councils.   • The  voter  rejection  of  the  referred  Use  Tax  ballot  question  in  2002  does  not   affect,  restrict  or  diminish  the  Town’s  legal  authority  to  impose  and  collect  the   sales  tax  under  the  Town’s  sales  tax  regulations  and  authority.   • The  enactment  of  any  exemption,  tax  credit  or  tax  rebate  for  Building  Materials   will  likely  have   a   financial   affect   on  the   Village   (at   Avon).     The   degree   of   financial  affect  and  potential  financial  impact  depends  upon  the  scope  of  such   exemption,  credit  or  rebate.   • The  Town  Council  has  broad  discretion  to  enact  exemptions,  credits  and  rebates   on  sales  tax  imposed  on  Building  Materials  provided  that  such  tax  relief  is  (1)   for  a  public  purpose,  (2)  does  not  discriminate  against  a  protected  class  and  (3)   does   not   discriminate   against   interstate   commerce,   thereby   violating   the   dormant  commerce  clause.   • The  Town  is  not  liable  for  refunds  of  any  past  sales  taxes  imposed  and  collected   on   Building   Materials   if   Council   adopts   legislation   to   provide   an   exemption,   credit  or  rebate  of  sales  tax  on  Building  Materials.   Specific  legal  topics  are  discussed  as  follows:     TOWN’S  DUTY  TO  ADMINISTER  AND  ENFORCE  SALES  TAX:    Chapter  3.08  –  Sales  Tax   includes  several  provisions  for  enforcement  and  administration  of  the  Town’s  sales  tax   regulations.    Section   3.08.290  –  Administration  states,   “The   administration   of   all   the   provisions  of  this  Chapter  is  vested  in  the  Director  of  Finance,  who  may,  with  the  approval   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  11  OF  20   of  the  Town  Manager,  prescribe  forms  and  reasonable  rules  and  regulations  in  conformity   with   this   Chapter   for   the   making   of   returns,   for   the   ascertainment,   assessment   and   collection   of   the   taxes  imposed   hereunder,   and   for   the   proper   administration   and   enforcement  hereof,  a  copy  of  which  forms,  rules  and  regulations  shall  be  made  available  to   the  public.”    The  Avon  Home  Rule  Charter,  Section  8.3  Powers  and  Duties,  states  the   Town  Manager’s  first  power  and  duty  as,  “(a)  be  responsible  for  the  enforcement  of  laws   and  ordinances  of  the  Town.”    The  Town  Staff,  by  and  through  the  Town  Manager,  has  a   general  affirmative  duty  to  administer  and  enforce  the  collection  of  sales  tax.   TAX  POLICY  CHANGE:    The  Taxpayer’s  Bill  of  Rights  (“TABOR”)  was  an  amendment  to  the   Colorado  constitution  adopted  in  1992  that  established  a  variety  of  circumstances  related   to  increases  in  revenue,  taxation  and  debt  that  required  prior  voter  approval.    Article  X,   Section  20(4)(a)  states  that  [D]istricts  must  have  voter  approval  in  advance  for  .  .  .  any  new   tax,  tax  rate  increase,  mill  levy  above  that  for  the  prior  year,  valuation  for  assessment  ratio   increase   for   a   property   class,   or   extension   of   an   expiring   tax,   or  a   tax   policy   change   directly  causing  a  net  tax  revenue  gain  to  any  district.    [emphasis  added].    As  outlined  in   my  memorandum  of  January  8,  2016,  the  imposition  of  the  Town’s  4%  sales  tax  on  Building   Materials  delivered  into  Avon  is  based  on  the  sales  tax  regulations  properly  adopted  by   Avon  and  pre-­‐dating  TABOR.    As  such,  the  imposition  of  the  Town’s  sales  tax  is  not  a  “new   tax”  or  “tax  rate  increase”  as  legally  defined  by  TABOR.       The   Colorado   Supreme   Court   announced   in   2009  Mesa   County   Board   of   County   Commissioners  case  that  a  “tax  policy  change  directly  causing  a  net  tax  revenue  gain  to  any   district”   must   be   considered   in   conjunction   with   Subsection   (7)   of   TABOR   concerning   revenue  limits.6    Where  prior  voter  approval  has  properly  occurred  to  allow  the  District  to   collect  revenues  in  excess  of  TABOR  revenues  limits,  a  subsequent  vote  is  not  required  for   each  tax  policy  change  directly  causing  a  net  tax  revenue  gain.    “We  find  that  a  tax  policy   change   directly   causing   a   net   tax   revenue   gain   only   requires   voter   approval   when   the   revenue  gain  exceeds  the  limits  dictated  by  subsection  (7).”  7       The  Mesa  County  Board  of  County  Commissioners  involved  a  challenge  to  legislation  to   direct   school   district   funds.     In   the   Town   of   Avon,   no   legislative   action   by   Council   has   occurred  with  regard  to  the  imposition  of  sales  tax  to  Building  Materials  delivered  into   Avon.    Rather,  the  imposition  of  the  Town’s  sales  tax  has  resulted  from  changes  in  case  law   and  administrative  efforts  to  increase  compliance  and  uniformity.     TABOR  CONSIDERATIONS:    The  Taxpayer’s  Bill  of  Rights  raises  several  legal  constraints   that   Council   should   understand.     The   Town   may   legally   enact   temporary   “tax   credits,”   which  may  expire  or  may  be  repealed  and  thus  effectively  allow  the  re-­‐imposition  of  the  tax   without  constituting  a  “new  tax”  or  “tax  rate  increase”  that  requires  prior  voter  approval.     Tax  credits  may  be  extended  in  the  Council’s  discretion.       The   Town   Council   may   also   enact   “tax   rebates”   whereby   the   tax   continues   to   be   imposed,  is  collected,  and  then  is  rebated  to  the  party  paying  the  tax.    Tax  rebates  are   permissible   where   Council   has   determined   that   the   primary   reason   for   the   rebate   is   a   6 Mesa  County  Board  of  County  Commissioners  v.  State,  203  P.3d  519  (Colo.2009).   7  Mesa  County  Board  of  County  Commissioners,  at  P.529. SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  12  OF  20   public  purpose.    Tax  rebates  can  be  specific  to  a  community  policy  goal  (e.g.  affordable   housing)  or  specific  to  a  project  that  is  expected  to  provide  public  benefits.    Tax  rebates  are   essentially  an  agreement  to  appropriate  an  expenditure  of  revenues  received  and  therefore   must  be  “subject  to  annual  budget  and  appropriation”  or  must  be  new  “special  project   revenues”  in  order  to  comply  with  TABOR’s  restriction  on  multi-­‐year  fiscal  obligations.       Alternatively,  the  enactment  of  a  “tax  exemption”  by  ordinance  is  permanent  and  such   exemption   cannot   be   repealed  or   reversed  without  voter   approval   in   compliance   with   TABOR.     EFFECT  OF  USE  TAX  REJECTED  BY  VOTERS:    The  Avon  voters  rejected  a  Use  Tax  in  2002.     The  referred  ballot  question  was  in  the  form  required  by  TABOR  and  asked  if  Town’s  taxes   should  be  increased,  “by  the  imposition  of  a  four  percent  (4%)  use  tax  on  the  privilege  of   using  or  consuming  in  the  Town  any  construction  materials.”    As  stated  in  my  January  8,   2016,  memorandum,  sales  tax  and  use  tax  are  legally  distinct.    Each  tax  has  a  separate  legal   authority  that  authorizes  the  imposition  of  such  tax.    The  scope  of  transactions  subject  to   sales  tax  and  the  scope  of  transactions  subject  to  a  use  tax  overlaps  and  courts  have  long   recognized  that  some  transactions  are  subject  to  both  the  sales  tax  and  use  tax  authority   (but  liable  to  pay  both  sales  tax  and  use  tax).    The  2002  Use  Tax  ballot  question  did  not  in   any  manner  affect   the   Town’s   legal   authority   to   impose   a   sales   tax   on   all   transactions   legally  subject  to  the  Town’s  sales  tax,  including  the  imposition  of  the  Town’s  sales  tax  on   retail  transactions  that  occur  within  the  Town  of  Avon.    Specifically,  the  2002  Use  Tax  did   not   ask   whether   the   use   or   consumption   of   construction   materials   in   Avon   should   be   exempt  from  paying  Avon’s  sales  tax.       The  Use  Tax  Ballot  Question  referred  to  the  voters  in  2002  was  worded  as  follows:   “SHALL   THE   TOWN   OF   AVON   TAXES   BE   INCREASED   $1.6   MILLION   ($1,600,000)   ANNUALLY   IN   2003,   AND   BY   WHATEVER   ADDITIONAL   AMOUNTS  ARE  RAISED  ANNUALLY  THEREAFTER,  BY  THE  IMPOSITION  OF  A   FOUR   PERCENT   (4%)   USE   TAX   ON   THE   PRIVILEGE   OF   USING   OR   CONSUMING  IN  THE  TOWN  ANY  CONSTRUCTION  MATERIALS,  SUCH  USE   TAX   REVENUES   TO   BE   APPROPRIATED   AND   SPENT   SOLELY   FOR   TRANSPORTATION  AND  RECREATION  CAPITAL  PROJECTS  AND  SERVICES   AND   INFRASTRUCTURE   RELATED   THEREO   [SIC],   ALL   IN   ACCORDANCE   WITH   ORDINANCE   NO.   02 -­‐18   ADOPTED   BY   THE   TOWN   COUNCIL;   AND   SHALL  THE  REVENUES  COLLECTED  FROM  SUCH  TAX  AND  ANY  EARNINGS   FROM  THE  INVESTMENT  OF  SUCH  REVENUES  BE  COLLECTED  AND  SPENT   AS  A  VOTER  APPROVED  REVENUE  CHANGE  AND  AN  EXCEPTION  TO  THE   LIMITS  WHICH  WOULD  OTHERWISE  APPLY  UNDER  ARTICLE  X,  SECTION  20,   OF  THE  COLORADO  CONSTITUTION  OR  ANY  OTHER  LAW?”   VILLAGE   (AT   AVON):    The   Town   of   Avon   originally   entered   into   an   Annexation   and   Development  Agreement  with  the  Village  (at  Avon)  in  1998  that  included  an  agreement  to   provide  a  “Tax  Credit”  on  Town  sales  tax,  accommodations  tax  and  real  estate  transfer  tax.     The   Annexation   and   Development   Agreement   was   amended   several   times,   then   was   substantially   revised   as   part   of   settlement   of   litigation   in   2014.     The   Consolidated,   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  13  OF  20   Amended  and  Restated  Annexation  and  Development  Agreement  for  the  Village  (at  Avon)   (“Development  Agreement”)  includes  the  Town’s  agreement  to  provide  a  credit  on  sales   taxes  on  “Taxable  Transactions”.8    This  Tax  Credit  is  codified  in  the  Avon  Municipal  Code  at   Section  3.08.035.   The  Development  Agreement  establishes  a  multi-­‐party  arrangement  whereby  (1)  the   Town  of  Avon  provides  a  Tax  Credit,  (2)  the  non-­‐profit  Public  Improvement  Companies   impose   a   “Public   Improvement   Fee”   or   “PIF”   on   retail   transactions   and   remit   those   revenues  to  the  Traer  Creek  Metropolitan  District,  and  (3)  the  Traer  Creek  Metropolitan   District  then  issues  tax  exempt  municipal  bonds  and  constructs  public  improvements  to   serve  development  in  the  Village  (at  Avon).   The  Development  Agreement  does  restrict  the  Town’s  ability  to  take  any  action  that   would  reduce  the  Tax  Credit  on  Taxable  Transactions,  but  does  not  restrict  the  Town’s   legislative  authority  to  enact  exemptions  to  transactions  that  are  subject  to  the  Town’s   sales  tax.    The  definition  of  “Taxable  Transaction(s)”  means  a  retail  sales  transaction  that  is   subject  to  the  Town’s  sales  tax.    [Emphasis  added].    Therefore,  the  Town  may  amend  its   sales   tax   regulation   by   ordinance   to   enact   new   exemptions,   thereby   defining   certain   transactions  that  are  not  subject  to  the  Town’s  sales  tax,  which  exemptions  would  then   apply  in  the  Village  (at  Avon).    Such  action  by  the  Town  would  not  violate  the  Development   Agreement.    However,  it  is  important  to  recognize  that  any  significant  legislative  change  to   the   Town’s   sales   tax   regulations   should  be   coordinated   with   Traer   Creek   Metropolitan   District  due  to  interrelated  financial  relationship.    Council  is  encouraged  to  understand  and   consider  any  potential  negative  consequences  that  new  sales  tax  exemptions  may  have  on   the  revenue  sources  and  ability  of  Traer  Creek  Metropolitan  District  to  service  outstanding   bonds.   DISCRETION  TO  GRANT  EXEMPTIONS:    The  Town  Council  may  adopt  exemptions  which   are  specific  to  certain  transactions  or  industries  provided  that  (1)  there  is  a  public  benefit   or   purpose   to   such   exemption   and   (2)   the   exemption   does   not   violate   constitutional   considerations.     There   are   many   examples   in   the   statutory   tax   authority   for   granting   exemptions,   or   legislatively   defining   certain   transactions   that   are   not   subject   to   a   tax.     Examples  of  sales  tax  exemptions  include  application  to  public  entities,  purchases  of  food,   purchases   of   food   with   food   stamps,   and   purchases   of   medical   supplies.    The   Town’s   existing   sales   tax   regulations   exempt   “medial   supplies”   “prosthetic   devices”   and   “therapeutic  devices”  from  the  imposition  of  sales  tax.9       With  regard  to  real  estate  transfer  tax,  the  Town  provides  an  exemption  for  the  first   $160,000  when  a  property  is  purchased  for  use  as  a  primary  residence.    The  Town  Council   may  grant  an  exemption  when  it  finds  that  the  exemption  will  promote  a  public  purpose.     Council  is  acting  in  a  legislative  capacity  when  enacting  such  exemptions.         8  Sec.  4.2(a)  of  the  Development  Agreement.   9  AMC  3.08.040   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  14  OF  20   Substantial   discretion   is   granted   by   courts   to   the   Town   Council   when   acting   in   a   legislative  capacity  to  determine  what  constitutes  a  valid  public  purpose.      However,  such   legislative  discretion  is  not  without  discretion.    Legal  limits  can  be  found  in  the  following   circumstances:   1. the  true  intent  is  to  provide  a  private  benefit  (i.e.  gift)  in  violation  of  the  gift  clause   of  the  Colorado  Constitution;   2. the  exemption  violates  equal  protection  (i.e.  discriminates  based  upon  a  protected   class  –  e.g.  race,  religion,  gender,  age,  etc.);  and,   3. the   legislation   would   discriminate   against   interstate   commerce   and   violate   the   dormant   commerce   clause   (e.g.   granting   an   exemption   for  Retailers   of   Building   Materials  located  in  Eagle  County  or  in  Colorado  but  imposing  the  sales  tax  on  out-­‐ of-­‐state  Retailers  that  deliver  Building  Materials  to  Avon).                             EXEMPTION  FOR  PUBLIC  ENTITIES:    Section  3.08.050  Exempt  Tax  Payers,  subsection   (1)   provides   a   general   exemption   from   sales   tax   for   public   entities,   but   then   states   in   subsection  (3):    “Nothing  herein  contained  shall  be  deemed  to  exempt  from  the  tax  levied   by  this  Chapter  sales  of  building  material  or  supplies  to  be  used  by  a  contractor  for  the   construction   of   an   improvement   for   any   of   the   institutions   or   agencies   enumerated   in   Subsections  (1)  or  (2)  above.”10    The  language  in  subsection  (3)  differs  from  state  statute   which  does  exempt  public  entities  from  paying  state  and  county  sales  tax  and/or  use  tax  on   construction  materials  used  in  public  projects.    Council  may  adopt  language  that  parallels   state  statute.   EXEMPTION  FOR  AFFORDABLE  HOUSING:    Council  may  adopt  an  exemption  of  sales  tax   on   Building   Materials   for   housing   projects.     The   provision   of   adequate   and   affordable   housing   has   long   been   recognized   as   a   legitimate   public   purpose   for   all   levels   of   government.    It  is  well  within  Council’s  discretion  to  adopt  an  exemption  (or  credit  or   rebate)   on   sales   tax   on  Building   Materials  for   affordable   housing   projects.     Specific   considerations  for  any  sales  tax  exemption,  credit  or  rebate  for  affordable  housing  projects   include:   • Defining  projects  eligible  for  exemption.    Such  as  deed  restricted,  public/non-­‐profit   rental  projects,  or  other  housing  projects  intended  to  serve  a  housing  demand.   • Applying  the  exemption  for  all  construction  materials,  whether  purchased  from  in-­‐ town  vendors  and  out-­‐of-­‐town  vendors  who  deliver  materials  to  Avon.   • Adopting  an  exemption  versus  a  “credit”  or  “rebate.”    A  rebate  has  the  advantage   that   it   would   help   a   purchaser   avoid   paying   sales   tax   on  Building   Materials  in   another  municipality  and  a  rebate  could  be  reduced  or  terminated  in  the  future   without  requiring  voter  approval.   LIABILITY  FOR  REFUND  IF  CODE  AMENDED:    The  question  was  asked  if  the  Town  would   be  liable  for  a  refund  to  those  who  have  paid  the  Town  sales  tax  on  Building  Materials   10  This  language  was  adopted  in  1982  by  Ordinance  No.  82-­‐27   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  15  OF  20   delivered  in  the  Town  in  the  past  if  the  Town  amended  its  sales  tax  regulations  to  exempt   such  transactions.    As  stated  in  my  prior  memorandum  dated  January  8,  2016,  it  is  my  legal   opinion  that  existing  sales  tax  regulation  was  properly  adopted  and  may  be  legally  applied   to  the  sale  of  Building  Materials  when  those  retail  transactions  occur  in  Avon,  including  the   transfer  of  possession  or  title  of  such  Building  Material  by  delivery  in  Avon.    The  Town  is   not  legally  or  financially  liable  for  past  administration  and  enforcement  of  a  law,  including   a  sales  tax  regulation,  by  virtue  of  amending  or  partially  repealing  such  law  by  legislative   action.   THREE  YEAR  LIMITATION  OF  ACTIONS:    Section  3.08.330  –  Sales  tax  –  collection  –   limitation  of  actions  states  that  the  Town  may  commence  enforcement  actions  for  unpaid   sales  tax  for  up  to  three  years  after  the  date  on  which  the  tax  was  payable;  however,  when  a   Retailer  has  failed  to  file  a  return,  the  sales  tax  may  be  assessed  and  collected  at  any  time.     Section  3.08.340  –  Sales  tax  –  refunds  –  limitation  of  actions  states  that  an  application   for  refund  of  tax  moneys  paid  in  error  or  by  mistake  must  be  made  within  three  years  after   the  date  of  the  purchase.    If  there  was  a  successful  legal  challenge  the  Town’s  collection  of   sales  tax  on  Building  Materials  sold  by  out-­‐of-­‐town  Retailers  and  delivered  into  Town,  the   Town  could  be  liable  for  a  refund  of  all  similar  collections  for  the  preceding  three  year   period.   CHANGES  IN  FEDERAL  AND  STATE  LAW:    Federal  and  state  law  is  expected  to  continue   evolving  with  regard  to  the  imposition  of  sales  tax  on  out-­‐of-­‐jurisdiction  Retailers  who   deliver  goods  into  a  jurisdiction.    The  U.S.  Supreme  Court  Quill  Corp.  strongly  emphasized   that  Congress  has  a  direct  role  in  legislating  on  such  issues.    The  Market  Place  Fairness  Act   was  introduced  in  2010,  which  would  have  required  out-­‐of-­‐state  Retailers  to  collect  and   remit   sales   tax   on   purchases   shipped   to   residents.     The   Marketplace   Fairness   Act   (a   substantially  similar  bill)  was  introduced  in  2013  and  2015.       Although  Congress  has  not  yet  passed  legislation  requiring  on-­‐line  Retailers  to  collect   and   remit   sales   tax,   several   large   internet   retailers   have  already  begun  collecting   and   remitting  sales  tax.    Amazon  recently  announced  that  it  will  collect  Colorado  state  sales  tax   after  an  on-­‐going  legal  challenge  to  Colorado’s  law  to  require  consumers  to  pay  sales  tax   and  to  require  on-­‐line  Retailers  to  report  sales  to  Colorado  consumers  to  the  Colorado   Department  of  Revenue.    The  national  trend  is  clearly  towards  on-­‐line  Retailers  collecting   and  remitting  sales  tax  on  delivered  goods.    Any  change  in  the  national  law  to  legislate  that   sales  tax  may  be  imposed  upon  goods  that  are  delivered  (via  U.S.  mail,  common  carrier  or   any  other  method)  and/or  to  redefine  what  constitutes  “doing  business  in  a  state  or  local   jurisdiction”  will  most  likely  directly  affect  local  sales  tax  regulations.    Council  is  cautioned   to   be   mindful   of   adopting   any   permanent   exemptions   to   Avon’s   sales   tax   which   may   become  inconsistent  with  future  national  law  concerning  out-­‐of-­‐state  Retailers.                           SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  16  OF  20   SECTION  III   SUMMARY  OF  FINANCIAL  INFORMATION     Included   in   this  Section  III  –  Summary   of   Financial   Information  are   two   tables   containing  statistical  information  regarding  building  activity  and  a  discussion  regarding   credit  ratings.       Table  1.    Table  1  is  a  summary  of  sales  taxes  collected  on  Building  Materials  for  the  years   2010  through  2015.    Also  included  is  information  regarding  the  number  of  sales  tax  return   filers,  both  in-­‐town  and  out-­‐of-­‐town,  for  each  Building  Materials  category.    In  addition,   totals   are   provided   for   both   in-­‐town   and   out-­‐of-­‐town  Building   Materials  sales   tax   collections  and  filers.    Finally,  total  sales  tax  collections  for  all  categories  of  sales  taxes  for   both  in-­‐town  and  out-­‐of-­‐town  are  presented.     Table  2.    Table  2  is  a  summary  of  commercial  and  residential  building  activity  including   the  number  of  permits  issued,  total  square  footage  and  value  for  commercial  construction,   and  the  number  of  dwelling  units  and  values  for  residential  construction.     Credit   Ratings.    Even   a   partial   reduction   in   the   Town’s   sales   tax   base   could   have   undesirable  consequences.    The  Town  is  proposing  to  issue  Certificates  of  Participation  for   its  portion  of  the  financing  of  the  joint  Police  /  Fire  Regional  Station  at  Buck  Creek.    In  the   past,  this  type  of  debt  has  been  rated  by  Standard  &  Poor’s  (A+)  and  Moody’s  (Aa3)  (see   attached   Exhibits   5   and   6)   due   primarily   to   the   Town’s   reserves,   consistent   financial   performance,  and  modestly-­‐sized  tax  base  based  on  an  adequate  economy  supported  by   good  financial  management.    A  down-­‐grade  in  these  ratings  would  undoubtedly  increase   the  interest  cost  of  the  Town’s  debt.     According  to  Moody’s  Credit  Opinion  for  the  Town  of  Avon,  page  4  states  that  both  a   “Deterioration  in  the  Town’s  financial  position”  and  “Substantial  decline  in  tax  base  size”   could   move   the   Town’s   ratings   down.    Enacting   any  sales   tax  exemption   which  is   not   common   for   Colorado   municipalities   and   which   is   viewed   as   a   material   change   to   the   Town’s  tax  base  could  adversely  affect  the  Town’s  credit  rating  from  both  Standard  and   Poor’s  and  Moody’s.         SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  17  OF  20     SECTION  IV     LEGISLATIVE  OPTIONS     This  Section   IV  –  Legislative   Options  outlines   and   describes   options   for   Council   consideration  regarding  the  imposition  of  sales  tax  on  Building  Materials.    Some  of  the   options  may  be  combined  or  may  be  varied  by  Council  direction  and  community  input.    For   all  options,  it  is  assumed  that  the  effect  on  the  Town’s  budget  (either  positive  or  negative)   is  a  relevant  consideration  for  Council;  however,  it  difficult  and  somewhat  speculative  for   Town  staff  to  estimate  or  forecast  the  potential  financial  effect  of  each  option.     1. No  Legislative  Action:    Council  has  the  option  of  not  amending  Chapter  3.08  of  the   Avon  Municipal  Code.    Under  this  option,  Town  staff  would  continue  current  efforts   to  inform,  impose,  collect  and  enforce  the  Town’s  sales  tax  on  the  sale  of  Building   Materials  by  Retailers  located  outside  Avon  and  delivered  into  the  Town  of  Avon.     Town  staff  is  continuing  to  improve  and  update  the  administration,  notification  and   guidance  materials  to  facilitate  understanding  and  compliance  of  the  Town’s  sales   tax  requirements.    Direction  from  Council  would  be  appropriate  on  specific  methods   or   actions   that   would   best   accomplish   the   goal   of   improving   uniformity   and   compliance.     2. Enact   An   Exemption   on   Delivered   “Building   Materials”:    Council   may   amend   Chapter  3.08  to  expressly  exempt  the  application  of  sales  tax  on  Building  Materials   that  are  delivered  to  Avon  AND  where  the  Retailer  does  not  have  a  physical  office   presence   in   Avon.     Specific   considerations   on  the   details   of   such   an   exemption   include:   a. Should  the  definition  of  “Building  Materials”  that  qualify  for  exemption  include   only  Building  Materials  that  are  incorporated  into  the  real  estate  (e.g.  concrete,   lumber,   insulation,   drywall,   fasteners,   etc.)?     Should   the   exemption   apply   to   fixtures   (e.g.   appliances,   toilets,   sinks,   faucets,   furnace,   etc.)?     Should   the   exemption   include   the   sales   of   material   and   equipment   from     “retailer-­‐ contractors”?   b. Should  an  exemption  for  delivered  “Building  Materials”  also  apply  to  out-­‐of-­‐town   Retailers  that  actively  advertise  within  the  Town  of  Avon  or  actively  use  sales   persons  within  the  Town  of  Avon?    (Active  advertisement  and  the  use  of  sales   persons  within  the  jurisdiction  are  facts  which  courts  have  considered  relevant   and   material   when   determining   whether   a   business   is   ‘conducting   business’   within  a  jurisdiction  and  therefore  subject  to  that  jurisdictions  taxation).   c. Are  there  any  financial  consequences  to  the  Town’s  credit  rating?   d. Are  there  any  financial  consequences  to  the  Traer  Creek  Metropolitan  District’s   ability   to   service   existing   debt   and   ability   to   issue   new   debt   to   finance   the   construction  of  additional  public  improvements  in  the  Village  (at  Avon).   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  18  OF  20   e. Are   there   any   impacts  to   existing   and   future   in -­‐town   Retailers   of  Building   Materials  arising  from  such  an  exemption.   f. Will   this   exemption   result   in   the   contractor   paying   sales   tax   to   another   municipality  when  the  Retailer’s  physical  location  is  in  another  municipality?     3. Enact  an  Exemption  on  all  “Building  Materials”:    Council  may  amend  Chapter   3.08   to   exempt   from   sales   tax   all   Building   Materials,   whether   purchased   from   a   Retailer  located  outside  Avon  and  delivered  into  the  Town  of  Avon  or  purchased   from  a  Retailer  located  in  Avon.    Specific  considerations  on  the  details  of  such  an   exemption  include:   a. The  general  considerations  stated  above  concerning  the  definition  of  Building   Materials;  and,   b. A   comprehensive   exemption   would   significantly   impact   Public   Improvement   Company  fee  revenue  sources  from  Home  Depot  and  other  retailer-­‐vendors  in   the   Village   (at   Avon)   which   may   materially   affect   the   existing   Public   Improvement  Fee  revenue  streams  and  the  ability  of  Traer  Creek  Metropolitan   District  to  service  existing  debt  payments.   4. Enact  an  Exemption  on  all  Delivered  Materials:    Council  may  amend  Chapter  3.08   to   exempt   all   tangible   personal   property   from   Town’s   sales   tax   when   sold   by   a   Retailer  located  outside  of  Avon  but  delivered  into  the  Town  of  Avon.      Specific   considerations  on  the  details  of  such  an  exemption  include:   a. Consideration  of  marketing  activities  within  the  Town  by  out-­‐of-­‐town  Retailer;   and,   b. The  competitive  impact  on  existing  in-­‐town  Retailers.   5. Enact   an   Exemption   for   Public   Facilities   and   Projects:    Council   may   amend   Chapter  3.08  to  exempt  the  imposition  of  sales  tax  on  Building  Materials  used  for   public   facilities   and   projects.     Such   exemption   would   simply   repeal   Section   3.08.050(3)  so  that  the  Town’s  sales  tax  regulations  are  consistent  with  the  State’s   sales   tax   regulations.     Such   an   exemption   would   apply   to   both   sales   by   in-­‐town   Retailers  and  sales  by  out-­‐of-­‐town  Retailers  that  deliver  to  Town.   6. Enact   an   Exemption   for   Affordable   Housing   Projects:    Council   may   amend   Chapter   3.08   to   exempt  the   imposition   of   sales   tax   on   Building   Materials   for   affordable   housing   projects.      Specific   considerations   on   the   details   of   such   an   exemption  include:   a. Defining  what  qualifies  as  an  affordable  housing  project  (e.g.  deed  restriction);   and,   SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  19  OF  20   b. Whether   to   apply   the   exemption   to   sales   by   both   out-­‐of-­‐town   and   in-­‐town   Retailers.   7. Enact  a  “Credit”  or  “Rebate”  Rather  Than  Exemption:    Council  may  provide  sales   tax  relief  in  the  form  of  a  credit  or  rebate  rather  than  an  exemption.      A  “credit”  or  a   “rebate”  may  be  repealed  or  re-­‐defined  in  scope  without  the  requirement  of  advance   voter  approval  as  required  by  the  Taxpayer’s  Bill  of  Rights.    A  credit  or  rebate  may   be   more   appropriate   when   granting   tax   relief   for   affordable   housing   projects   because  the  Council  retains  greater  flexibility  to  update  the  definitions  and  scope  of   the  credit  or  rebate  over  time  depending  upon  circumstances.   8. Enact   a   Temporarily   Reduced   Sales   Tax   on   Delivered   Building   Materials:     Council   may   enact   a   temporary   sales   tax   credit   or   rebate   on   delivered   building   materials  which  is  phased  out  over  time.    The  Town’s  existing  4%  sales  tax  was   originally  phased-­‐in  such  that  the  sales  tax  rate  was  1%  for  the  first  year,  2%  the   second  year,  3%  the  third  year,  and  the  full  4%  commencing  on  the  fourth  year.   9. Refer  a  Use  Tax  Ballot  Question  for  Voter  Consideration:    Council  may  refer  a   ballot  question  on  Use  Tax  to  the  next  eligible  TABOR  election  on  November  8,  2016,   which,  if  approved  by  the  Avon  voters,  would  (1)  complement  the  Town’s  sales  tax,   as  widely  recognized  throughout  the  nation,  (2)  would  be  more  comprehensive  in   applying  to  all  goods  used  in  Avon  rather  than  goods  that  are  delivered  in  Avon  or   sold  in  Avon,  and  (3)  would  significantly  simplify  administration,  compliance  and   enforcement.   10. Dedicate  Sales  Tax  on  Building  Materials  to  a  Specific  Purpose:    Council  may   enact  an  ordinance  pledging  the  revenue  from  sales  tax  on  Building  Materials  to  a   specific  purpose  (e.g.  capital  improvement  projects,  affordable  housing).    Council   has  previously  enacted  an  ordinance  pledging  Real  Estate  Transfer  Tax  revenues  to   the  capital  improvement  projects  fund.    An  ordinance  adopting  a  pledge  or  earmark   of   revenues   for   an   identified   purpose   can   be   changed   by   a   future   Council   by   adoption  of  a  new  ordinance.                 SALES  TAX  REPORT  ON  BUILDING  MATERIALS   February  4,  2016 PAGE  20  OF  20   SECTION  V   RECOMMENDATIONS  FOR  SALES  TAX  ADMINISTRATION  IMPROVEMENT     Town  staff  provides  the  following  recommendations  to  improve  sales  tax  administration:     1. Meet  with  New  Licensees.    Newly  licensed  contractors  would  be  required  to  meet   with  Finance  Department  representatives  prior  to  being  issued  a  building  permit  to   ensure  they  have  the  proper  business  license,  determine  whether  or  not  they  are   required  to  have  a  sales  tax  license,  and  provide  necessary  assistance  and  guidance   in  these  processes.     2. Create  and  Publish  Administrative  Guidelines.    Administrative  Guidelines  would   be  used  to  provide  more  information  and/or  guidance  on  specific  sales  tax-­‐related   issues.    They  can  be  more  detailed  than  the  Municipal  Code  and  can  use  real-­‐life   examples.     3. Reach-­‐out  to  Potential  New  Licensees.    Conduct  periodic  informational  campaigns   to   inform   the   public   and   potential   new   businesses   about   the   Town’s   licensing   requirements.     4. Work   with   Community   Development   Department.    Coordinate   with   the   Community  Development  Department  to  identify  ways  to  ensure  compliance  with   the  Town’s  licensing  requirements.     5. Website  Improvements.    Continue  to  review  information  provided  on  the  Town’s   website  and  update  when  appropriate  to  improve  it’s  efficiency,  accessibility  and   functionality  for  users.                             EXHIBIT 1 EXHIBIT 2 EXHIBIT 3 EXHIBIT 4 EXHIBIT 5 EXHIBIT 5 EXHIBIT 5 EXHIBIT 5 EXHIBIT 6 EXHIBIT 6 EXHIBIT 6 EXHIBIT 6 TABLE 1 SALES TAX COLLECTIONS RELATED TO BUILDING MATERIALS 2010 - 2015 # of # of # of # of # of # of Building Materials NAICS Category Amount Filers Amount Filers Amount Filers Amount Filers Amount Filers Amount Filers Other Foundation, Structure, and Building Exterior Contractors 2,273.07$ 3 2,294.76$ 4 8,398.86$ 4 9,979.07$ 4 3,379.96$ 4 32,451.13$ 8 Other Building Equipment Contractors 14,209.32 15 10,237.09 16 21,712.16 21 19,251.09 33 22,227.27 33 45,839.52 31 Other Building Finishing Contractors 1,818.96 1 2,166.79 1 2,769.98 2 3,348.02 5 46,031.75 7 37,766.96 10 All Other Specialty Trade Contractors 6,340.97 19 10,234.98 17 9,769.90 15 8,709.09 22 92,789.42 33 123,600.94 49 Lumber Merchant Wholesalers 10,393.80 1 21,542.15 2 17,054.55 2 18,983.05 4 30,510.01 4 17,517.59 4 Plumbing & Heating Equip & Supplies Merchant Wholesalers 96,715.12 4 111,142.41 3 122,178.23 3 132,259.19 5 175,269.12 6 174,362.76 5 Floor Covering Stores - 2 - 0 - 0 - 2 49,140.77 9 73,515.17 10 Window Treatment Stores - 1 - 1 - 1 1,483.69 3 1,074.50 3 - 2 Household Appliance Stores - 1 2,064.67 3 57,691.60 3 28,660.05 4 15,958.72 4 18,895.68 4 Home Centers - 2 - 2 - 2 - 2 63,902.97 3 78,357.71 4 Paint and Wallpaper Stores - 0 - 0 - 0 - 2 - 1 - 1 Other Building Material Dealers 78,621.58 12 78,444.13 16 91,737.20 14 115,155.11 17 101,512.48 14 40,803.39 11 Total Sales Tax on Building Materials 210,372.82$ 61 238,126.98$ 65 331,312.48$ 67 337,828.36$ 103 601,796.97$ 121 643,110.85$ 139 In Town vs. Out-of-Town Building Materials In-Town 166,153.97$ 14 180,253.80$ 14 258,564.76$ 15 237,766.41$ 18 282,975.73$ 16 331,502.90$ 21 Out-of-Town 44,218.85 47 57,873.18 51 72,747.72 52 100,061.95 85 318,821.24 105 311,607.95 118 Total 210,372.82$ 61 238,126.98$ 65 331,312.48$ 67 337,828.36$ 103 601,796.97$ 121 643,110.85$ 139 In Town vs. Out-of-Town - All Categories In-Town 4,897,186.29$ 90.59%4,838,603.47$ 88.87%5,003,178.47$ 89.58%5,698,370.34$ 89.58%6,091,583.92$ 86.19%6,533,511.26$ 86.56% Out-of-Town 508,767.08 9.41%606,209.76 11.13%582,045.10 10.42%662,697.53 10.42%976,175.54 13.81%1,014,359.53 13.44% Total 5,405,953.37$ 100.00%5,444,813.23$ 100.00%5,585,223.57$ 100.00%6,361,067.87$ 100.00%7,067,759.46$ 100.00%7,547,870.79$ 100.00% Notes: (1) In those instances where there is less than 3 filers in a category, the sales tax amounts have been added to the category titled "Other Building Material Dealers" in order to maintain confidentiality. 201520102011201220132014 TABLE 2 COMMERCIAL AND RESIDENTIAL CONSTRUCTION LAST TEN FISCAL YEARS Total Total Building Permits Square No. of Construction Year Issued Footage Value Units Value Value 2006 146 26,639 114,860,200$ 12 13,980,955$ 128,841,155$ 2007 166 19,242 25,248,538 93 10,970,648 36,219,186 2008 145 11,416 2,525,749 15 11,165,780 13,691,529 2009 91 - 725,000 3 8,683,371 9,408,371 2010 112 16,517 3,215,036 7 9,806,550 13,021,586 2011 125 2,210 922,600 9 8,412,190 9,334,790 2012 126 54,250 11,400,000 8 2,448,500 13,848,500 2013 159 217,293 27,121,876 12 9,027,760 36,149,636 2014 156 - 1,500,000 10 13,735,900 15,235,900 2015 163 179,149 16,207,000 25 18,792,261 34,999,261 Source: Town of Avon Community Development Department Commercial Construction Residential Construction TOWN COUNCIL REPORT To: Honorable Mayor Jennie Fancher and Avon Town Council From: Justin Hildreth, Town Engineer Meeting Date: February 9, 2016 Agenda Topic: Fourth Amendment to Intergovernmental Agreement for a Joint Fire-Police Station Facility between the Town of Avon and the Eagle River Fire Protection District for Review and Action on Fee Waiver Request by Eagle River Fire Protection District ACTION BEFORE COUNCIL To review and approve, approve with changes or deny the Fourth Amendment to the Intergovernmental Agreement to waive Building Permit fees and planning review fees, allocate Town of Avon Water Tap Fee to the project, and delay the decision to waive the Exterior Energy Offset Program fee until the geothermal feasibility study is completed for the proposed Public Safety Facility (PSF). PROPOSED MOTION I move to approve the Fourth Amendment to the Intergovernmental Agreement for a Joint Fire- Police Station Facility between the Town of Avon and the Eagle River Fire Protection District, which waives Building Permit fees and planning review fees, and allocates the payment of the Town of Avon Water Tap Fee to offset the actual water infrastructure costs for the project. Action on the request to waive the Exterior Energy Offset Program fee will be delayed until the results of the geothermal feasibility study is completed. DISCUSSION The Eagle River Fire Protection District (ERFPD) is requesting that each entity waive respective development fees for the Public Safety Facility since this is a joint public facility that provides important benefits to the community. Below is a listing of each fee, what it is used for, how it is calculated, and a recommendation if it should be waived. The final land area needed for the Police Station building and associated parking was finalized with the development of the Schematic Design. Based upon the methodology approved in the Second Amendment to the IGA, the final calculation resulted in less land needed, and, as such, a lower purchase amount. This final calculation is provided below. ERFPD Fees The ERFPD charges three types of development fees that can be waived for the project: • Fire Sprinkler Permit and Plan Check Fee cover ERFPD’s expenses in reviewing, permitting and inspecting fire sprinkler systems. The fee is based on building square footage and the split will be based on each entities square footage use of the building.  Page 2 • Fire Alarm Permit and Plan Check Fee cover ERFP’s expenses in reviewing, permitting and inspecting fire alarm systems. The fee is based on building square footage and the split will be based on each entities square footage use of the building. • ERFPD Impact Fee, which is included in the Avon Municipal Code and is based on the water meter size, covers the impact of new development on providing fire protection services. The fee will be split 50/50 since the water services infrastructure will be split 50%50% as agreed upon in the existing IGA. Town of Avon Fees The Town of Avon Building Permit fee and planning fees are split 45% Avon and 55% ERFPD based on the valuation of the project. The following is a brief description of the fees the Town charges for this type of development: • The Building Permit fee is based on the valuation of the project using formulas in the International Building Code and is intended to cover all Town cost to review and inspect the building. This fee can be waived by Town Council since the project provides a benefit to the community. If the fee is not waived, it should be adjusted based on the actual construction costs of each entity. • The planning review fees, as outlined in the Avon Municipal Code, cover the Town’s expenses to provide planning review and approval. This fee can be waived by Town Council since the project provides a benefit to the community. • The Town of Avon Water Tap Fee is $4,000 per Single Family Equivalent (SFE) as outlined in the Avon Municipal Code and must be used to cover water infrastructure costs. The PSF will have a 2” water meter, which corresponds to 10.30 SFEs, and an Avon Water Tap Fee of $41,200. The fee would be split evenly between Avon and the ERFPD since it is an infrastructure cost, which are split evenly in the existing IGA. This fee can be waived or allocated to cover water infrastructure costs of the project, including the water service line and piping the Nottingham Puder Ditch. • The Exterior Energy Offset Program was recently adopted by Town Council. The program charges $16/SF fee on exterior snowmelt systems. Monies are contributed to a fund, which is then contributed to other residential projects to lower nonrenewable energy use. The fund is administered by Eagle County. The fee and can be reduced when onsite renewable power generation (i.e. geothermal) is developed and equal to 50% of the energy needs of snowmelt. A feasibility study is underway for the site and the results should be known and presented at the March 1, 2016, Town Council meeting. Any geothermal benefit would be useable only by the building, as geothermal cannot be used to melt snow. If geothermal is feasible for the building, the energy use can be quantified and applied to the exterior snowmelt. If the study does not result in the nonrenewable offset meeting the code requirements, staff recommends the fee be paid by both the Town and ERFPD. Avon Land Cost Reconciliation As part of the Second IGA Amendment, the final land cost for the Town’s Police Department was updated to match the revised program. The updated programs, based upon the methodology used to compute land costs, calculated that the Town’s land cost should be $835,847 versus a previous estimate of $852,042, a $16,195 reduction. Town Council representatives Jennie Fancher and Buz  Page 3 Reynolds found the amount to be non-substantive, for the purposes of finalizing the Second IGA Amendment, allowing the continuation of building design to proceed. The Town Council should make a final determination on how to address the final land cost. TABLE 1 Summary of Fees Recommended to be Waived Town of Avon Fees Total Fee Avon Portion ERFPD Portion Building Permit $ 91,809 $ 41,314 $ 50,495 Planning Review Fee $ 1,400 $ 630 $ 770 Total Avon Fees Waived $ 93,209 $ 41,944 $ 51,265 ERFPD Fees Fire Sprinkler Permit $ 2,829 $ 1,316 $ 1,513 Fire Alarm Permit $ 1,918 $ 892 $ 1,026 Fire Impact Fee $ 8,857 $ 4,429 $ 4,429 Total ERFPD Fees Waived $ 13,604 $ 6,637 $ 6,968 TOTAL WAIVED FEES $ 106,813 $ 48,580 $ 58,233 Note: Avon is waiving $79,605 more in fees than the ERFPD. TABLE 2 Summary of Fees Not Recommended to be Waived Fees Total Fee Avon Portion ERFPD Portion Avon Water Tap Fee $ 41,200 $ 20,600 $ 20,600 PENDING STUDY: Exterior Energy Off- Set Program $ 125,360 $ 15,096 $ 110,264 TOTAL FEES $ 166,560 $ 35,696 $ 130,864 Attachment A: Fourth Amendment to Intergovernmental Agreement for a Joint Fire-Police Station Facility Between the Town of Avon and the Eagle River Fire Protection District ATTACHMENT A ERFPD-Avon Fourth Amendment February 2, 2016 Page 1 of 4 FOURTH AMENDMENT TO INTERGOVERNMENTAL AGREEMENT FOR A JOINT FIRE-POLICE STATION FACILITY BETWEEN THE TOWN OF AVON AND THE EAGLE RIVER FIRE PROTECTION DISTRICT THIS FOURTH AMENDMENT TO AN INTERGOVERNMENTAL AGREEMENT (“Fourth Amendment”) is made and entered into on February 2, 2016, (“Effective Date”) by the Town of Avon, a home rule municipal corporation of the State of Colorado (“Avon”) and the Eagle River Fire Protection District, a quasi-municipal corporation and political subdivision of the State of Colorado organized under Title 32 of the Colorado Revised Statutes (“Fire District”) (collectively, the “Parties,” and each individually a “Party”). RECITALS WHEREAS, the Parties have entered into an Intergovernmental Agreement for a Joint Fire-Police Station Facility Between the Town of Avon and the Eagle River Fire Protection District (“IGA”), dated April 28, 2015; and the Parties have entered into a MEMORANDUM OF AGREEMENT REGARDING COST SHARING FOR PROGRAMMING, DESIGN AND PRE- CONSTRUCTION MANAGEMENT OF A JOINT FIRE-POLICE STATION FACILITY BETWEEN THE TOWN OF AVON AND THE EAGLE RIVER FIRE PROTECTION DISTRICT dated June 9, 2015 (“MOA”); and the Parties have entered into a SECOND AMENDMENT TO INTERGOVERNMENTAL AGREEMENT FOR A JOINT FIRE-POLICE STATION FACILITY BETWEEN THE TOWN OF AVON AND THE EAGLE RIVER FIRE PROTECTION DISTRICT, dated January 11, 2015 (“2nd Amendment to IGA”); and the Parties have entered into a THIRD AMENDMENT TO INTERGOVERNMENTAL AGREEMENT FOR A JOINT FIRE-POLICE STATION FACILITY BETWEEN THE TOWN OF AVON AND THE EAGLE RIVER FIRE PROTECTION DISTRICT, dated February 9, 2016; and, WHEREAS, the Fire District has submitted a written request to Avon dated January 15, 2016, requesting, among other matters, Avon to waive water tap and building permit fees as may be applicable to the joint fire-police station facility project in order to reduce the cost of the project; and, WHEREAS, the Fire District has agreed to waive its fire sprinkler permit fee, fire alarm permit fee, and fire impact fee as may be applicable to the joint fire-police station facility project in order to reduce the cost of the WHEREAS, Avon desires to accommodate the request of the Fire District to reduce the cost of the regional fire station by waiving the cost of Avon’s building permit and planning review fees as may be applicable to the joint fire-police station facility; and, WHEREAS, Paragraph 14 provides that Parties may amend the IGA; and, WHEREAS, this Third Amendment is authorized pursuant to §29-1-201 and §30-11-101, Colorado Revised Statutes, as amended, and Article XIV, Section 18, of the Colorado Constitution. ATTACHMENT A ERFPD-Avon Fourth Amendment February 2, 2016 Page 2 of 4 NOW THEREFORE, in consideration of the covenants and mutual agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties, the Parties hereto agree as follows: 1. Effective Date. This Fourth Amendment shall commence on the Effective Date. 2. Waiver of Fees. As summarized in Exhibit 1, Avon agrees to waive building permit fees planning review fees in an amount not to exceed $ 93,209 and the Fire District agrees to waive fire sprinkler fees, fire alarm fees and fire impact fees in an amount not to exceed $13,604.4 related to the construction of the regional fire and police station facility on Lot 1B, Buckcreek Subdivision, Town of Avon, CO, subject to the following conditions: a. The Fire District voters approve a ballot question for financing the construction of the regional fire station facility on Lot 1B, Buckcreek subdivision, Avon, CO on May 3, 2016; b. The Avon voters approve a ballot question for financing the construction of a police station on Lot 1B, Buckcreek subdvision, Avon, CO on May 3, 2016; and, c. The Fire District submit a complete building permit application by August 1, 2017, that complies in all material respects with the Avon Municipal Code, including but not limited to, Avon’s building regulations as adopted in Title 15 of the Avon Municipal Code. 3. Other Terms in Full Force and Effect. All other terms in the IGA, as amended by the MOU and the Second Amendment, shall remain in full force and effect. EXECUTED as of the date first written above. TOWN OF AVON, COLORADO BY: ATTEST: _____________________________________ ______________________________ Jenny Fancher, Mayor Debbie Hoppe: Town Clerk APPROVED AS TO FORM: ____________________________________ Eric J. Heil, Esq., Avon Town Attorney ATTACHMENT A ERFPD-Avon Fourth Amendment February 2, 2016 Page 3 of 4 EXECUTED as of the date first written above. EAGLE RIVER FIRE PROTECTION DISTRICT BY: ATTEST: ____________________________________ _____________________________ Jennifer Cartmell Hays, Chairperson Clark Shivley, Secretary APPROVED AS TO FORM: ____________________________________ James P. Collins, Esq. ATTACHMENT A ERFPD-Avon Fourth Amendment February 2, 2016 Page 4 of 4 EXHIBIT 1 Town of Avon Fees Total Fee Avon Portion ERFPD Portion Building Permit $ 91,809 $ 41,314 $ 50,495 Planning Review Fee $ 1,400 $ 630 $ 770 Total Avon Fees Waived $ 93,209 $ 41,944 $ 51,265 ERFPD Fees Fire Sprinkler Permit $ 2,829 $ 1,316 $ 1,513 Fire Alarm Permit $ 1,918 $ 892 $ 1,026 Fire Impact Fee $ 8,857 $ 4,429 $ 4,429 Total ERFPD Fees Waived $ 13,604 $ 6,637 $ 6,968 TOTAL WAIVED FEES $ 106,813 $ 48,580 $ 58,233 TOWN COUNCIL REPORT To: Honorable Mayor Jennie Fancher and Avon Town Council From: Matt Pielsticker, Planning Director Meeting Date: February 9, 2016 Agenda Topic: Intergovernmental Agreement between Town of Avon and Eagle County for Plan4Health Project ACTION BEFORE COUNCIL Execution/approval of the Intergovernmental Agreement (IGA) between Town of Avon and Eagle County Government for the Plan4Health project. PROPOSED MOTION Approve IGA between Town of Avon and Eagle County for the Plan4Health project. 2016 BUDGET INFORMATION In exchange for participation in the project, following completion of the policy scan component, the Town of Avon will receive $5,000 (transfer of funds anticipated during summer, 2016). This project will require minimal staff time from Town of Avon Staff (Community Development Department). BACKGROUND The Healthy Communities Coalition of Eagle County, which is comprised of multidisciplinary professionals and community members and coordinated by Eagle County Government, received Plan4Health grant funds to support healthy eating and active living (HEAL) for all in Eagle County. Through the Plan4Health project, the Coalition will: • Gain a common understanding of HEAL attributes by examining the comprehensive plans of six Eagle River Valley Towns (Gypsum, Eagle, Avon, Minturn, Red Cliff, and Vail) and Eagle County. • The review of comprehensive plans will inform future resolutions for passage by municipalities that outline their community’s specific priorities related to HEAL in the built environment, and Towns will receive recommendations on how to better incorporate HEAL priorities in to future plans. • Finally, given that community voice is critical to community planning processes, the Coalition will seek to understand each municipality’s experience with community engagement and provide tools and resources to help municipalities with future outreach. In addition, a plan for more coordinated authentic community engagement efforts and information sharing will be explored.  Page 2 Katie Haas, Healthy Communities Coordinator, Eagle County Public Health and Environment, will give a brief presentation to highlight the grant and expected outcomes for local communities. EXHIBIT IGA between Town of Avon and the County of Eagle INTERGOVERNMENTAL AGREEMENT BETWEEN THE TOWN OF AVON AND THE COUNTY OF EAGLE, COLORADO FOR PLAN4HEALTH PROJECT This Intergovernmental Agreement (“Agreement”) by and between EAGLE COUNTY, a body politic and corporate of the State of Colorado (“County”) and Town of Avon, a Colorado municipal corporation (“Town”) (collectively the “Parties”) is effective this ____ day of __________, 2016. WHEREAS §29-20-101 et seq., C.R.S. enables the Parties to enter into Intergovernmental Agreements and authorizes each of the Parties to perform the functions described herein, as provided in §29-20-105 C.R.S.; and WHEREAS, the American Planning Association (“APA”), in partnership with the American Public Health Association received an award from the Centers of Disease Control and Prevention (the “Sponsor”) as part of the National Dissemination and Implementation program within the Division of Community Health, Funding Opportunity Announcement #DP14-1418. These funds have allowed the APA to bring support to local coalitions in efforts to reduce chronic disease in communities across the United States through the APA’s Plan4Health project (the “Plan4Health Project”); and WHEREAS, the Healthy Communities Coalition of Eagle County (the “Healthy Communities Coalition”), in conjunction with the Colorado Public Health Association and the Colorado Chapter of the APA (the “Colorado APA”), applied for funding under the Plan4Health Project; and, WHEREAS, APA Colorado received an award of grant funds (the “Grant Award”) from the APA pursuant to the Plan4Health Project Grant Agreement (the “Grant Agreement”); and, WHEREAS, Eagle County is the subgrantee of such Grant Award and is working collaboratively with the Healthy Communities Coalition to implement the Plan4Health Project in Eagle County; and WHEREAS, the Plan4Health project will enable the Healthy Communities Coalition to further its mission to increase opportunities for healthy eating and active living (HEAL) for all in Eagle County by 1) enabling a policy scan of municipal comprehensive plans for components that support or deter HEAL, 2) supporting municipalities to pass resolutions prioritizing HEAL and 3) providing resources to municipalities to support community engagement; and WHEREAS the Town has determined that it is in the best interest of the Town and its inhabitants to contribute to the efforts of Eagle County and the Health Communities Coalition in support of and implementation of Plan4Health Project; and WHEREAS the Plan4Health Grant Award allows for payment of an administrative fee to the Town in exchange for the Town’s commitment to and participation in the Plan4Health Project; and 2 WHEREAS, the Parties desire to enter into this Intergovernmental Agreement to define the manner in which the Town will participate in the Plan4Health Project. NOW THEREFORE, in consideration of the mutual rights and obligations as set forth below, the parties agree to the following: A. SCOPE OF PROJECT. 1. The County will collaborate with the Town to conduct a policy scan of the Town’s comprehensive plan to determine existing policies that support and/or prohibit healthy living in the context of the built environment. The policy scan will be facilitated by a subcontractor engaged with Plan4Health Grant Funds and managed by the County. The County will additionally collaborate with and support the Town in consideration and adoption of a resolution to prioritize goals relating to healthy living. The Town will also be encouraged to consider amendments, modifications and additions to existing local government health related policies to prioritize healthy living goals. 2. The Town agrees to work with County Representatives, as well as subcontractors engaged with Plan4Health Funds and managed by the County, to facilitate the Plan4Health Project. The Town’s participation may entail attending occasional meetings, providing access to requested policy documents (e.g. comprehensive plan), and answering questions relating to those documents. Total staff time to be devoted by the Town to the Plan4Health Project is anticipated to be minimal. 3. The Town may participate in additional Project Strategies that may include: working with County and Plan4Health Grant Project subcontractors to develop a framework and system for community engagement, participating in learning opportunities about authentic community engagement, and receiving materials to support municipal community outreach efforts. B. TOWN COMMITMENTS. The Town has determined that it is in the best interest of the Town and its inhabitants to contribute to the efforts of Eagle County and the Healthy Communities Coalition in support of and implementation of Plan4Health Project. The Town is committed to participating in the Scope of Project outlined and to collaborate with and support Eagle County and the Healthy Communities Coalition in implementation of the Plan4Health Project. To the extent applicable, the Town shall be subject to the terms and conditions of the Plan4Health Grant Agreement between the APA and the Colorado APA. C. AUTHORIZED REPRESENTATIVES. The County designates Katie Haas, of the Eagle County Public Health and Environment and Kris Valdez, Eagle County Planner, as its Representatives for the Agreement. The County’s Representatives are its liaison officers to the Town for all purposes in carrying out the Agreement. The Town designates _______ as its Representative for the Agreement. The Town’s Representative is its liaison officer to the County for all purposes in carrying out the Agreement. D. FUNDING. In exchange for the Town’s commitment to and participation in the Plan4Health Project and the Scope of Project outlined above, the Town will receive funding from the Grant Award in an amount not to exceed $5,000.00 (the “Project Funds”). The Project 3 Funds should be used in support of the Town’s participation in this Agreement and the Plan4Health Project. Disbursement of the Project Funds will be made to the Town upon completion of the Project Strategy 1 policy scan, referenced in Section A above. Additional funds from the Grant Award may be disbursed to the Town for additional projects deemed necessary by the Plan4Health Project. In such case, the Town will submit an invoice and supporting documentation to the County identifying the additional tasks or projects performed. Disbursement of additional funds from the Grant Award will be made in accordance with the Plan4Health financial requirements and guidelines. The Town acknowledges that the County is not responsible for any payments which may become due to the Town under the Plan4Health Project or this Agreement. Plan4Health Funding is regulated under Code 45 of the Federal Regulations (CFR) Part 75, Uniform Administrative Requirements, Cost Principles and Audit Requirements for HHS Awards. As specified in this Code, Project Funds may not be used for lobbying purposes. E. PERSONNEL. Every Town officer and employee engaged in performing under this Agreement shall remain an officer or employee of the Town while performing the same. The relationship of the Town to Eagle County under this Agreement is that of independent political bodies. This Agreement does not change the status of any employee, contractor or officer of the Town or County. The Town shall have no authority to bind or commit the County to any agreement or other obligations. F. LIABILITY. The County, its officers and employees, shall not be deemed to assume any liability for intentional or negligent acts, errors, or omissions of the Town or of any officer or employee thereof. Likewise, the Town, its officers and employees, shall not be deemed to assume any liability for intentional or negligent acts, errors or omissions of the County or by any officer or employee thereof. G. INSURANCE. The County and the Town shall respectively provide its own public liability, property damage, and errors and omissions insurance coverage as each party may deem adequate and necessary for any potential liability arising from this Agreement. The County and the Town, respectively, shall name, subject to the approval of each respective party's insurance carriers, the other respective party as a co-insured under such insurance policies to the extent of any potential liability arising under this Agreement and, upon reasonable written request, shall furnish evidence of the same to the other respective party. The Parties further agree, without waiving any governmental immunity protection to which they and their officials and employees are entitled under CRS 24-10-101 et seq., to procure and maintain current valid workers compensation insurance coverage for all subject workers throughout the period of this Agreement. H. NO WAIVER OF GOVERNMENTAL IMMUNITY. Nothing in this Agreement shall be construed to waive, limit, or otherwise modify any governmental immunity that may be available by law to the Town or to the County and their respective officials, employees, contractors, or agents, or any other person acting on behalf of the Town or the County, and, in particular, governmental immunity afforded or available pursuant to the Colorado Governmental Immunity Act, Title 24, Article 10, Part 1 of the Colorado Revised Statutes. 4 I. TERM. This Agreement will be effective as of the effective date stated above and subject to the provisions set forth herein, shall continue in full force and effect through the 30th day of September 2016. J. TERMINATION. 1. Termination Due to Unavailability of Funding: The Town understands that the availability of Project Funds is contingent on appropriations made by the Sponsor. If at any time the Colorado APA determines that funds are insufficient to sustain existing or anticipated spending levels, the Town understands that the Colorado APA may reduce, suspend or terminate any reimbursement, other payments or allocations of funds provided by the Colorado APA for the Plan4Health Project. 2. Termination by Mutual Consent: This Agreement may be terminated in whole or in part when both Parties agree that continuation is not feasible or would not produce beneficial results commensurate with the further expenditure of the Project Funds. The parties must agree on the termination conditions, including effective date and the portion of the Agreement to be terminated. 3. Termination for Cause: In the event of a default or violation of the terms of this Agreement by the Town or its failure to use the Project Funds for only the purposes set in this Agreement, the County may take the following action: i. Suspension: After notice to the Town, suspend this Agreement and withhold any further disbursement or prohibit the Town from incurring additional obligations of Project Funds, pending corrective action by the Town. ii. Termination: Terminate this Agreement in whole or in part, at any time before the date of completion, whenever it is determined that the Town has failed to comply with the terms and conditions of this Agreement. The County shall promptly notify the Town in writing of the determination and the reasons for the termination together with the effective date. Disbursements made to the Town or recoveries by the County shall be in accordance with the legal rights and liabilities of the parties. Disbursements and recoveries may include, but are not limited to, payments allowed for costs determined to be not in compliance with the terms of this Agreement. The Town shall return to the County all unencumbered Project Funds. Further, any costs previously paid by the Plan4Health Project which are subsequently determined to be unallowable through audit and close-out procedures may be recovered pursuant to the closeout procedures set forth in the Grant Agreement or as designated by APA Colorado or Sponsor. iii. Recovery of Funds: In the event of default, failure to perform under this Agreement or violation of the terms of this Agreement, the Town understands that APA Colorado or the Sponsor may institute such action as necessary to reduce, withdraw or recover all or part of the Project Funds from the Town. K. FINANCIAL RESPONSIBILITY OF TOWN. The Town assumes sole responsibility for reimbursement to the Colorado APA or the Sponsor of a sum of money equivalent to the amount of any expenditures disallowed should the Sponsor or an authorized agency rule through audit exception or some other appropriate means that expenditures from Grant Funds allocated to 5 the Town for were not made in compliance with the regulations of the granting or funding agency or the provisions of this Agreement. L. NOTICES AND PAYMENTS. All notices, bills and payments shall be made in writing and may be given by personal delivery or by mail. Notices, bills, payments sent by mail should be address as follows: Town of Avon Eagle County Avon, Colorado Eagle County, Colorado Attn: Matt Pielsticker Attention: Katie Haas PO Box 975 500 Broadway Avon, CO 81620 Post Office Box 850 Telephone: 970-748-4413 Eagle, CO 81631 E-mail: Mpielsticker@avon.org Telephone: 970-328-8855 E-Mail: Katie.haas@eaglecounty.us With a copy to: Eagle County Attorney 500 Broadway Post Office Box 850 Eagle, Co 81631 Telephone: 970-328-8685 Facsimile: 970-328-8699 E-Mail: atty@eaglecounty.us M. MODIFICATION. This Agreement contains the entire agreement between the parties, and no agreement shall be effective to change, modify, or terminate in whole or in part unless such agreement is in writing and duly signed by the party against whom enforcement of such change, modification, or termination is sought. The Parties agree that any amendments to laws or regulations pursuant to which the Grant Award was made shall result in the correlative modification of this Agreement without the necessity for executing written amendments. Any written amendment shall be prospective in nature. N. NO THIRD PARTY BENEFICIARIES. Nothing contained in this Agreement is intended to or shall create a contractual relationship with, cause of action in favor of, or claim for relief for, any third party, including any agent, sub-consultant or sub-contractor of Town or County. Absolutely no third party beneficiaries are intended by this Agreement. Any third-party receiving a benefit from this Agreement is an incidental and unintended beneficiary only. O. VENUE, JURISDICTION AND APPLICABLE LAW. Any and all claims, disputes or controversies related to this Agreement, or breach thereof, shall be litigated in the District Court for Eagle County, Colorado, which shall be the sole and exclusive forum for such 6 litigation. This Agreement shall be construed and interpreted under and shall be governed by the laws of the State of Colorado. IN WITNESS WHEREOF, each party, by signature below of its authorized representative, herby acknowledges that it has read this Agreement, understands it and agrees to be bound by its terms and conditions. EAGLE COUNTY, by and through its Board of County Commissioners By:_____________________ Kathy Chandler-Henry, Chair Attest:_________________________ Teak Simonton, Clerk to the Board TOWN OF AVON by and through its Town Council By: _____________________ Jenny Fancher, Mayor Attest:_________________________ Debbie Hoppe, Town Clerk Plan4Health Grant Project Katie Haas Healthy Communities Coordinator Eagle County Public Health and Environment Kris Valdez Planner Eagle County Grant Amount: $125,000 Grant Term: January - September, 2016 Implementation: Healthy Communities Coalition, Coordinated by Eagle County Government, in partnership with Eagle River Valley municipalities Plan4Health Communities Nationally Red = cohort 1 Blue = cohort 2 Plan4Health Primary Activities Policy Scan •Review comprehensive plans of all Eagle River Valley communities HEAL Cities and Towns Campaign •Support of Towns to adopt resolutions and/or policies that improve healthy living Community Engagement Support •Understand Town’s community engagement efforts •Provide tools and resources to support future engagement Participating Communities: Towns of Avon, Eagle, Gypsum, Minturn, Red Cliff, Vail; unincorporated Eagle County communities via Eagle County Government Healthy Living/Built Environment Examples •Access to healthy food - e.g. community gardens, local grocers •Access to physical activity – e.g. parks, open space, recreation centers, sidewalks •Creating a sense of place •Access to transportation •Connectivity HEAL Cities and Towns Campaign •https://www.youtube.com/watch?v=pUDt6eNx EUw 1 Debbie Hoppe From:Eric Heil <ericheillaw@gmail.com> Sent:Wednesday, January 27, 2016 9:09 AM To:Preston Neill; Matt Pielsticker Cc:Virginia Egger Subject:Plan4Health Just to close the circle if it hasn’t been closed already - Eagle County wants the IGA on the Plan4Health project approved sooner than March so they can get started. I have reviewed the IGA, it is acceptable and it could go on the February 9 agenda. Suggested Agenda Item: Approval of Intergovernmental Agreement between the Town of Avon and the County of Eagle, Colorado for Plan4Health Project. This IGA provides up to $5,000 to (each) Town to assist with cost of participation. Someone (Matt?) would need to prepare a memo explaining the project - which I have discussed with Matt seems a little fuzzy to me. Town’s obligation is to “participate, collaborate and support” the County project. As an FYI - the grant funding is from the national American Planning Association funneled through the Colorado Chapter. I serve on the Board of Directors of the Colorado Chapter. As the only attorney on the Board serving on a volunteer basis, I reviewed the agreement between APA Colorado and Eagle County to funnel the grant funds to Eagle County. The APA Colorado Board of Directors is scheduling to approve this grant funding agreement on Feb 5 and Eagle County BOCC is scheduling its approval on February 9. As an aside, I don’t think I have a conflict of interest, but I honestly haven’t thought about it too much considering the nature of the project where the Town receives some funds for participation in a planning effort led by the County and consultants to be hired by the County. There is one quirk that the County desires to allow anonymous stakeholder input in the agreement between APA Colo and Eagle County (this term is not in the individual Town IGAs). And then the IGA states, "To the extent applicable, the Town shall be subject to the terms and conditions of the Plan4Health Grant Agreement between the APA and the Colorado APA.” So - I will ask APA Colo to allow me to forward the Grant Funding agreement to you and for inclusion in the Council packet. An agreement that references the terms of second agreement will then require the second agreement to be available for complete understanding. Eric Eric J. Heil, Esq., A.I.C.P. Heil Law & Planning LLC 1022 Summit Drive Dillon, CO 80435 Office: (970) 468-0635 Cell: (303) 518-4678 This communication may contain confidential attorney-client privileged information. Unauthorized receipt or use of this communication is not permitted. If you have received this message in error, please delete the message and contact Heil Law & Planning LLC immediately. Heil Law & Planning, LLC Office: 303.975.6120 3445 S. Clermont St. Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Jennie Fancher and Town Council members FROM: Eric J. Heil, Town Attorney RE: Mountain Star Water Storage Tank Site Annexation Process DATE: February 4, 2016 SUMMARY: The Upper Eagle River Water Authority has submitted an application to annex the 5 acre water storage tank site adjacent to the Mountain Star development into the Town of Avon. This water storage tank site has a long history that dates back to the original approvals of the Mountain Star development. The preferred water storage tank site was identified on Forest Service land to the north and uphill of the Mountain Star development (see the Town of Avon Land Exchange Map). The Upper Eagle River Water Authority acquired this site along with other water storage tank sites from the U.S. Forest Service as part of the multi-party land exchange that was completed several years ago. The use of the property is intended for the construction of a water storage tank to serve the Mountain Star development. It is generally the practice and preference to annex lands into a municipality that include public infrastructure serving development in the municipality. INITIATING THE ANNEXATION PROCESS: The Town follows the annexation process in the Municipal Annexation Act of 1965. The process begins with the receipt of a complete annexation petition and the adoption of a resolution to initiate the process. Resolution No. 16-02 is attached. A complete overview of the entire annexation process is described below. WAIVER OF FEES: Section 7.36.040(c) of the Avon Municipal Code states that the Town Council may waive fees for the review of annexation. Resolution No. 16-02 includes a waiver of fees for review of annexation. The property petitioning for annexation is for public infrastructure serving a portion of Avon and the anticipated review costs for the annexation are minimal. PROPOSED MOTION: “I move to approve Resolution No. 16-02 INITIATING ANNEXATION OF THE MOUNTAIN STAR WATER TANK SITE PROPERTY, FINDING THE PETITION FOR ANNEXATINO TO BE IN SUBSTANTIAL COMPLIANCE, AND SETTING A PUBLIC HEARING.” ANNEXATION PROCESS OVERVIEW: The overall annexation process is simplified because this is a property that will only be used for constrution of public infrastructure which was designed and planned several decades ago. Development is not planned for this property; therefore, the more complex and involved annexation review and analysis concerning impacts to infrastructure and community facilities are not applicable to this application. 1. UERWA creates annexation map of property to annex, signs Petition for annexation, and submits to the Town of Avon. 2. The Annexation Petition is referred to the Town Council. The Town Council then adopts a Resolution which does three things: (1) determines if the Petition meets the minimum requirements for allegations and signatures and is “valid”, (2) formally “initiates” annexation proceedings, and (3) sets a public hearing. CRS §31-12-108. 3. The public hearing shall be held not less than 30 days nor more than 60 days after the date of the initiating Resolution. A notice of the public hearing must be published once a week for four (4) successive weeks in a newspaper of general circulation (Vail Daily). A copy of the published notice, resolution and petition shall be sent by registered mail to each of the following: (1) the clerk of the M EMORANDUM & PLANNING, LLC Avon Town Council Mountain Star Annexation Process February 4, 2016 Page 2 of 2 Mountain Star Annexation Process February 4, 2016 Page 2 of 2 Board of County Commissioners, (2) to the County Attorney, (3) to the school district, and (4) to any special district having territory within the area to be annexed. The notice must be sent at least 25 days prior to the date of the hearing. CRS §31-12-108. 4. An “Annexation Impact Report” is not required for this annexation because it is less than ten acres in total area. CRS §31-12-108.5. 5. The public hearing is held. The Town Council determines whether the Property is eligible for annexation (1/6 contiguity automatically establishes eligibility, therefore, this step is mostly a formality). 6. If the Town Council determines the property is eligible for annexation, the Town Council then adopts a second Resolution with formal findings that the property is eligible for annexation. 7. Town Council adopts an Ordinance actually annexing the property. First reading of the Ordinance can occur on the same evening as the public hearing. 8. Town Council adopts Ordinance that applies zoning. First reading of the Ordinance zoning the property can occur on the same evening but must be scheduled after the annexation ordinance on the agenda. By statute, the process of zoning land can begin once the Petition for Annexation is submitted and the actual zoning must occur within 90 days of the effective date of annexation. It is more convenient and efficient to run the annexation and zoning process concurrently. The expected zoning classification is PF – Public Facilities. An amendment or update to the Avon Comprehensive Plan may also be required, which can occur concurrently with the zoning application. 9. 30 days after adoption ordinances and annexation maps are recorded, and Property is then officially annexed. SCHEDULE OF ACTIONS: Town Council: Resolution Initiating Annexation process (Set Hearing for Mar. 22) February 9, 2016 Publish Notice of Hearing (4 consecutive weeks) Feb 16, Feb, 23, Mar 1 and Mar 8 Deadline for Notice of Public Hearing by Planning Commission on Zoning Feb 19 Send Notice by Registered Mail to BOCC, County Attorney, Special Districts and School (25 days in advance) Feb 26 (last date) Planning Commission: Public Hearing - Review of Zoning March 1 Deadline to Post Notice of Public Hearing on Zoning March 11 Public Hearing: Resolution to Adopt Finding that Property is Eligible for Annexation Public Hearing: 1st Reading of Ordinance to Annex Property Public Hearing: 1st Reading of Ordinance to Zone Property March 22 Public Hearing: 2nd Reading of Ordinance to Annex Property Public Hearing: 2nd Reading of Ordinance to Zone Property April 12 Record Ordinances and Annexation Maps May 12 Thank you, Eric Attachments: Annexation Application Location Map Resolution No. 16-02 January 25, 2016 Debbie Hoppe, Town Clerk Town of Avon 1 Lake Street Avon, CO 81620 Dear Debbie, I have enclosed separate Annexation Plats for Tract WT-1 and WT-2, together containing 5.00 acres, and, on behalf of the Upper Eagle Regional Water Authority (“Authority”), I hereby request serial annexation of both Tracts to the Town of Avon. I have also enclosed the executed Petition for Annexation from the Authority. The Authority acquired Lot 16, Section 25, Township 4 South, Range 82 West, 6th Principal Meridian, Eagle County, Colorado by U.S. Patent in 2013, Reception No. 201309275, from the United States of America in the Eagle County Land Exchange for the specific purpose of constructing a water storage tank above the Mountain Star Subdivision in the Town of Avon. In order to complete the permitting process for this new tank, it is appropriate that this property first be annexed to the Town. I request that this property be zoned PF – Public Facilities to be consistent with the proposed use of the property. I also request that the Town waive any fees for review of this Petition for Annexation as it is being submitted by another governmental entity in which the Town is a Contracting Party. The Authority plans to begin construction of this water storage tank in April 2016. I therefore request expedited consideration and approval of this Petition for Annexation so that this important project can proceed to completion as soon as possible. Sincerely, Jason Cowles, P.E. Planner, Upper Eagle Regional Water Authority Enclosures: Land Development Application Annexation Petition Annexation Plat List of Property Owners within 300’ of Annexation Parcel Mailing Envelopes for Adjacent Property Owners cc: Linn Brooks, General Manager James P. Collins, General Counsel Virginia Egger, Town Manager Matt Pielsticker, Town Planner Mailing addresses of all adjacent property owners within 300 feet of the Mountain Star Tank Parcel proposed for annexation: • Legal: Mountain Star Lot 37 (1969 Paintbrush) Owner: SUE C. RUSHMORE TRUST - MICHAEL H. RUSHMORE, JR TRUST 141 E MEADOW DR STE 1000 VAIL, CO 81657-5857 • Legal: Mountain Star Lot 36 (1931 Paintbrush) Owner: VUKICH, JOHN & CAROLYN 35 BAYSIDE DR MADISON, WI 53704-5901 • Legal: Mountain Star Tract M (1875 Paintbrush), Mountain Star Tract J, and Mountain Star Road Rights-Of-Way Owner: MOUNTAIN STAR ASSOCIATION C/O EAST WEST RESORTS PO BOX 5480 AVON, CO 81620-5480 • Legal: Mountain Star Lot 35 (1855 Paintbrush) Owner: GLASTEIN, DEBORAH 84 W RIVER RD RUMSON, NJ 07760-1139 • Legal: Mountain Star Lot 34 (1827 Paintbrush) Owner: POWER, JAMES P. PO BOX 6010 AVON, CO 81620-6010 This map was produced by the Community Development Department. Use of this map should be for general purposes only. Town of Avon does not warrant the accuracy of the data contained herein. Author: JKoenig Date: 05/04/11Town of Avon Land Trade 0 3,2001,600 Feet USFSWest Parcel USFSEast Parcel Beaver Creek Eagle Vail Wildridge Mountain Star Land Trade Parcels Town of Avon Boundary Roads Public Land Roads I-70 HWY 6 Property Boundary Lakes and Rivers Res. No. 16-02 February 9, 2016 Page 1 of 1 Res. No. 16-02 February 9, 2016 Page 1 of 1 TOWN OF AVON RESOLUTION NO. 16-02 INITIATING ANNEXATION OF THE MOUNTAIN STAR WATER TANK SITE PROPERTY, FINDING THE PETITION FOR ANNEXATION TO BE IN SUBSTANTIAL COMPLIANCE, AND SETTING A PUBLIC HEARING WHEREAS, the Upper Eagle River Water Authority owns the Mountain Star Tank Site property described on the attached Exhibit A: Legal Description of Mountain Star Tank Site Property (“Property”); WHEREAS, the Upper Eagle River Water Authority has submitted a Petition for Annexation and annexation map in accordance with C.R.S. §31-12-107; WHEREAS, the Town Council of the Town of Avon finds that the Petition for Annexation is in substantial compliance with the requirements in C.R.S. §31-12-107(1); WHEREAS, the Town Council of the Town of Avon desires to initiate annexation proceedings for the Property and set a public hearing in accordance with C.R.S. §31-12-108; and, WHEREAS, the Town Council of the Town of Avon finds that the waiver of fees for the review of annexation in accordance with Section 7.36.040(c) is appropriate because the nature of the annexation is to provide public infrastructure and the actual cost of annexation review by the Town is minimal. NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF AVON the following: SECTION 1. The Town Council hereby finds that the Petition for Annexation of the Property is in substantial compliance with the requirements of C.R.S. §31-12-107(1). SECTION 2. The Town Council hereby sets a public hearing in accordance with C.R.S. §31- 12-108(1) to determine if the annexation complies with §31-12-104 and §31-12-105, such public hearing is scheduled to be held on March 22, 2016 at 5:00 p.m., or as soon thereafter as possible, at the Avon Town Hall, located at One Lake Street, Avon, Colorado. SECTION 3. The Town Council hereby waives fees for the review of the annexation in accordance with Section 7.36.040(c) of the Avon Municipal Code. SECTION 4. The Town Clerk is hereby directed to publish notice of the public hearing and send a copy of the notice of the public hearing by registered mail in accordance with C.R.S. §31- 12-108(2). ADOPTED on February 9, 2016. AVON TOWN COUNCIL By:_______________________________ Attest:___________________________ Jennie Fancher, Mayor Debbie Hoppe, Town Clerk TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY, JANUARY 26, 2016 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 1-27-2016 Minutes Page 1 1. CALL TO ORDER & ROLL CALL Mayor Fancher called the meeting to order at 5:22 p.m. A roll call was taken and Council members present were Buz Reynolds, Matt Gennett, Jake Wolf, Megan Burch, Scott Prince and Sarah Smith Hymes. Also present were Town Manager Virginia Egger, Town Attorney Eric Heil, Assistant Town Manager Scott Wright, Police Chief Bob Ticer, Recreation Director John Curutchet, Executive Assistant to the Town Manager Preston Neill and Town Clerk Debbie Hoppe. 2. APPROVAL OF AGENDA There were no changes to the agenda. 3. PUBLIC COMMENT Michael Cacioppo and Peter Buckley commented. 4. ACTION ITEMS 4.1. PUBLIC HEARING AMPLIFIED SOUND PERMIT APPLICATION FOR WINTERWONDERGRASS MUSIC & BREW FESTIVAL (DIRECTOR OF FESTIVALS & SPECIAL EVENTS DANITA DEMPSEY) Mayor Pro Tem Wolf recused himself due to a conflict. The application was presented by Scott Stoughton. Mayor Fancher opened the Public Hearing and no comments were made. Councilor Gennett moved to approve the Amplified Sound Permit application for WinterWonderGrass Music & Brew Festival 2016 striking the second sentence in paragraph three under background in the Town Council Report. Councilor Smith Hymes seconded the motion and it passed unanimously by those present. Mayor Pro Tem Wolf abstained from the vote. 4.2. UPDATE ON 2016 FESTIVALS AND SPECIAL EVENTS AT THE PAVILION, HARRY A. NOTTINGHAM PARK AND MAIN STREET MALL (DIRECTOR OF FESTIVALS & SPECIAL EVENTS DANITA DEMPSEY) 4.3. ACTION ON FUNDING REQUEST AND SETTING OF DATES FOR THE 2016 APRÈS AVON SPRING CONCERTS AT POSSIBILITY PLAZA (PRODUCER MIKE O’BRIEN) Michael Cacioppo commented. Councilor Reynolds moved to approve the dates of March 18 and March 25, 2016, and to appropriate $37,000 from the 2016 General Fund Special Events Assigned Fund Balance, to Peak Performances, for the purpose of producing the 2016 Après Avon Spring Concerts. Mayor Pro Tem Wolf seconded the motion and it passed on a 5 to 2 vote. Councilor Prince and Councilor Gennett voted no. 4.4. ACTION ON FUNDING REQUEST AND SETTING OF DATES FOR THE AVON LIVE! SUMMER CONCERTS (PRODUCER MIKE O’BRIEN) Councilor Smith Hymes moved to approve the dates of August 3, 10, 17 and 24, 2016, and appropriate $66,000, from the 2016 General Fund Special Events Assigned Fund Balance, to Peak Performances, for TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY, JANUARY 26, 2016 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 1-27-2016 Minutes Page 2 the purpose producing of Avon Live! Summer Concert Series. In addition, Councilor Smith Hymes moved to appove up to $2,600 of in-kind services. Mayor Pro Tem Wolf seconded the motion and it passed on a 6 to 1 vote. Councilor Prince voted no. 4.5. ACTION ON FUNDING REQUEST AND SETTING OF DATES FOR THE OUTLAWS & LEGENDS MUSIC FESTIVAL (BACKPORCH PRODUCTIONS, LLC) Michael Cacioppo commented. Councilor Burch moved to approve the dates of July 28th through July 31st, 2016, and to appropriate $72,000 from the General Fund Special Events Assigned Fund Balance to Backporch Productions to produce the Outlaws & Legends Music Festival. In addition, Councilor Burch moved to approve up to $10,000 of in-kind services. Councilor Reynolds seconded the motion and it passed on a 4 to 3 vote. Councilor Prince, Councilor Gennett and Mayor Pro Tem Wolf voted no. 4.6. FIRST READING OF ORDINANCE 16-02 CONSIDERATION OF REQUEST BY EAGLE RIVER FIRE PROTECTION DISTRICT TO PROVIDE RELIEF FROM SALES TAX ON CONSTRUCTION MATERIALS FOR REGIONAL FIRE STATION AND CONSIDERATION OF THIRD AMENDMENT TO INTERGOVERNMENTAL AGREEMENT FOR A JOINT FIRE- POLICE STATION FACILITY BETWEEN THE TOWN OF AVON AND THE EAGLE RIVER FIRE PROTECTION DISTRICT (TOWN ATTORNEY ERIC HEIL) Michael Cacioppo commented. Councilor Prince moved to approve the Consideration of Request by Eagle River Fire Protection District to Provide Relief from Sales Tax on Construction Materials for Regional Fire Station and Consideration of Third Amendment to Intergovernmental Agreement for a Joint Fire-Police Station Facility between the Town of Avon and the Eagle River Fire Protection District. Councilor Gennett seconded the motion and it passed unanimously by those present. 4.7. PUBLIC HEARING SECOND READING OF ORDINANCE NO. 16-01, AN ORDINANCE AMENDING CHAPTER 3.30 UNCLAIMED PROPERTY OF THE AVON MUNICIPAL CODE (ASSISTANT TOWN MANAGER SCOTT WRIGHT) Mayor Fancher opened the Public Hearing and no comments were made. Councilor Reynolds moved to approve the second and final reading of Ordinance No. 16-01, an Ordinance Amending the Town’s Unclaimed Property Code Chapter 3.30. Councilor Gennett seconded the motion and it passed unanimously by those present. 4.8. FIRST READING OF ORDINANCE NO 15-11, AN ORDINANCE AMENDING THE AVON MUNICIPAL CODE TABLE 7.16-1 AND SECTION 7.16.060(H)(1) CONCERNING AMENDMENTS TO WILDRIDGE PUD APPLICATIONS NOTE: STAFF HAS REQUESTED CONTINUATION TO THE MARCH 8, 2016 REGULAR TOWN COUNCIL MEETING (PLANNING DIRECTOR MATT PIELSTICKER) TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY, JANUARY 26, 2016 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 1-27-2016 Minutes Page 3 Councilor Smith Hymes moved to continue the First Reading of Ordinance No 15-11, to the March 8, 2016, Regular Town Council Meeting. Mayor Pro Tem Wolf seconded the motion and it passed unanimously by those present. 4.9. MINUTES FROM JANUARY 12, 2016 MEETING (EXECUTIVE ASSISTANT TO THE TOWN MANAGER PRESTON NEILL) Councilor Reynolds moved to approve the minutes from January 12, 2016 meeting. Mayor Pro Tem Wolf seconded the motion and it passed unanimously by those present. 5 WRITTEN REPORTS 5.1 MONTHLY FINANCIAL REPORT (BUDGET ANALYST KELLY HUITT) 6. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 6.1. CAST (COUNCILOR SARAH SMITH HYMES) 7. MAYOR & COUNCIL COMMENTS 8. EXECUTIVE SESSION - THIS SESSION IS NOT OPEN TO THE PUBLIC 8.1. DISCUSSION OF THE PURCHASE AND ACQUISITION OF A REAL PROPERTY INTEREST UNDER C.R.S. §24-6- 402(2)(A) AND A CONFERENCE WITH THE TOWN ATTORNEY FOR THE PURPOSE OF RECEIVING LEGAL ADVICE UNDER C.R.S. §24-6-402(2)(B) RELATED TO SUCH REAL PROPERTY DISCUSSION AND FOR THE PURPOSE OF DETERMINING POSITIONS RELATIVE TO MATTERS THAT MAY BE SUBJECT TO NEGOTIATIONS, DEVELOPING STRATEGY FOR NEGOTIATIONS, AND/OR INSTRUCTING NEGOTIATORS, UNDER C.R.S. §24-6- 402(2)(E) RELATED TO SUCH REAL PROPERTY DISCUSSION 8.2. FOR A CONFERENCE WITH THE TOWN ATTORNEY FOR THE PURPOSE OF RECEIVING LEGAL ADVICE UNDER C.R.S. §24-6-402(2)(B) CONCERNING THE UPPER EAGLE RIVER WATER AUTHORITY. Mayor Fancher moved to meet in Executive Session for the purpose of a Discussion of the Purchase and Acquisition of a Real Property Interest under C.R.S. §24-6-402(2)(A) and a Conference with the Town Attorney for the Purpose Of Receiving Legal Advice under C.R.S. §24-6-402(2)(B) related to such Real Property Discussion and for the Purpose of Determining Positions Relative to Matters that may be subject to Negotiations, Developing Strategy For Negotiations, and/or Instructing Negotiators, under C.R.S. §24-6-402(2)(E) related to such Real Property Discussion as well as a Conference with the Town Attorney for the purpose of receiving legal advice under C.R.S. §24-6- 402(2)(b) concerning the Upper Eagle River Water Authority. Councilor Reynolds seconded the motion and it passed unanimously by those present. The time was 8:16 p.m. Executive session ended at 10:28 p.m. Council reconvened into regular session at 10:29 p.m. TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY, JANUARY 26, 2016 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 1-27-2016 Minutes Page 4 9. ADJOURNMENT There being no further business to come before the Council, the regular meeting adjourned at 10:30 p.m. RESPECTFULLY SUBMITTED: _________________________________ Debbie Hoppe, Town Clerk APPROVED: Jennie Fancher ________________________________ Jake Wolf ________________________________ Matt Gennett ________________________________ Megan Burch ________________________________ Albert “Buz” Reynolds ________________________________ Scott Prince ________________________________ Sarah Smith Hymes ________________________________