REGULAR COUNCIL MEETING
The Regular Council Meeting was held on November 13, 2006 at 7:30 p.m. with Council President Williams presiding. Council members present were Mr. Carey, Mrs. Russell, Mr. McGlumphy, Mr. Slavin, Mr. McGiffin, Mr. Hogan, Mr. Salters, and Mr. Ruane.
Council staff members present were Police Chief Horvath, Mr. Capuano, Mrs. Mitchell, Mrs. Townshend, Fire Chief Bashista, Mr. DePrima, City Solicitor Rodriguez, and Mrs. McDowell. Mayor Speed was absent.
OPEN FORUM
The Open Forum was held at 7:15 p.m., prior to commencement of the Official Council Meeting. Council President Williams declared the Open Forum in session and reminded those present that Council is not in official session and cannot take formal action.
Mrs. Barbara Austin, 699 Roberta Avenue, Schoolview, stated that she received a certified letter on November 9, 2006 indicating that a four story, 91 room, Mainstay Suites Hotel would be built on two and a half acres of land on Stover Boulevard, east of the intersection with US 113. The previous notice of September 2005 also included a restaurant and professional offices.
Mrs. Austin advised members that the residents of Schoolview object to the planned connection with the existing sewer system in Schoolview to accommodate the new construction. She noted that they have had sewer back up into their basements. Residents are also concerned with the traffic generated by the daily inspection and maintenance of the pump station, which is located on Roberta Avenue adjacent to Schoolview. Mrs. Austin suggested moving the pump station out of the residential area. She also requested a diagram of the proposed sewer lines.
Mrs. Austin provided a petition signed by 94 Schoolview residents objecting to the proposed connection to the Schoolview sewer system (as on file in the Office of the City Clerk). She requested that copies be provided to Planning Commission members prior to their next meeting.
Mr. Robert Hollingsworth, 228 N. Caroline Place, noted that the City has been keeping taxes very low to accommodate the general public. He suggested that the City be progressive instead of stagnant and raise taxes to keep up with inflation, defray the cost of improving the water system, and make Dover a quality City.
Mrs. Mary Skelton, Executive Director of Kent County Tourism, advised members that she would be retiring at the end of the year. She stated that it has been a great honor and a privilege to work with the Council and serve the City of Dover for the past 17 years. Mrs. Skelton thanked the current and past Mayor’s, City Managers, Council members, and Police Chiefs for their unfailing support over the years. She also challenged members to work toward a new library, a new City Hall, a decent bus stop, and a civic center.
The invocation was given by Chaplain Dixon, followed by the Pledge of Allegiance.
AGENDA ADDITIONS/DELETIONS
Mr. Carey moved for approval of the agenda, seconded by Mrs. Russell and unanimously carried.
Mrs. Williams requested that item #7-a-1 - Annexation Request, be removed from the Consent Agenda. Mr. McGlumphy requested that item #7-B - Presentation - PACE and NAES Quarterly Report, item #7-C - Presentation - Burns and McDonnell - Rate Analysis, and item #9-B - Recommendation of RV Subcommittee - Proposed Ordinance Amendments, be removed from the consent agenda.
Mr. Carey moved for approval of the Consent Agenda, as amended, seconded by Mr. Salters and carried by a unanimous roll call vote.
ADOPTION OF MINUTES - REGULAR COUNCIL MEETING OF OCTOBER 23, 2006
The Minutes of the Regular Council Meeting of October 23, 2006 were unanimously approved by motion of Mr. Carey, seconded by Mr. Salters and bore the written approval of Mayor Speed.
CERTIFICATE OF CONGRATULATIONS - CITY OF DOVER FIRE MARSHAL’S OFFICE
On behalf of the Mayor and members of Council, Councilman Carey presented a Certificate of Congratulations to Mr. David Truax, Mr. Sam Gonzalez, and Mr. Wayne Hutchison of the City of Dover Fire Marshal’s Office in recognition of receiving the Governor’s Partnership Award for Excellence in Prevention and Fire Safety Education.
Mr. Truax, Fire Marshal, advised members that two years ago the Fire Marshal’s Office developed an adult fire safety program in an effort to reduce the number of fires in the City. He noted that State Farm Insurance provided a $4,500 grant last year and a $2,500 grant this year for the program.
PROCLAMATION - GEOGRAPHIC INFORMATION SYSTEMS DAY AND GEOGRAPHIC AWARENESS WEEK
The City Clerk read the following Proclamation into the record:
WHEREAS, technology will play a vital role in the future growth of the City of Dover and the use, management, and exchange of geographic information technology is necessary for effective decision making by local, state, and federal governmental agencies; and
WHEREAS, Geographic Information Systems (GIS) provide data that allows for the identification of patterns and relationships of real-world conditions that ultimately lead to better decisions and improved delivery of services for the citizens of Dover as well as our surrounding communities; and
WHEREAS, geographic information has many useful applications and is a valuable resource used in the analysis of infrastructure, emergency services, homeland security, economic development, and long-range planning; and
WHEREAS, geography, the study of the Earth’s natural resources, features, climate, and population is important in understanding our relationship with the environment, and GIS technology aids us in this vital learning process.
NOW, THEREFORE, I, STEPHEN R. SPEED, MAYOR OF THE CITY OF DOVER, do hereby proclaim November 15, 2006 as GIS Day, and November 13 – 17, 2006 as Geography Awareness Week.
On behalf of the Mayor and Council, Mr. DePrima, City Manager, presented Mr. Mark Nowak, GIS Coordinator, with the Proclamation. Mr. Nowak invited everyone to attend GIS Day on Wednesday, November 15, 2006 to see how City departments are using the GIS system.
FINAL READING - REZONING OF PROPERTY LOCATED ON THE SOUTH SIDE OF WHITE OAK ROAD, WEST OF MOURNING DOVE LANE, OWNED BY TLFD MANAGEMENT, LLC
During their Regular Meeting of October 23, 2006, a public hearing was held to consider rezoning of property located at on the south side of White Oak Road, West of Mourning Dove Lane, consisting of 12.7898+/- acres, owned by TLFD Management, LLC. This property is currently zoned R-20 (One Family Residence) and the proposed zoning is R-8 (One Family Residence). Final action was tabled until November 13, 2006 in order to allow staff time to contact the State of Delaware and Kent County regarding their position on the rezoning request.
Mr. Hogan moved to take the application from the table, seconded by Mr. Salters and unanimously carried.
Mrs. Ann Marie Townshend, City Planner, advised members that correspondence had been received from the State Planning Coordination Office (Exhibit #1) indicating their opposition to the rezoning request since it is contrary to the provisions of the 1999 Garrison Tract Memorandum of Understanding which identifies agricultural and low density as the most desirable land use for properties east of SR1. She noted that correspondence had also been received from the applicant, TLFD Management (Exhibit #2), as well as correspondence from City Solicitor Rodriguez (Exhibit #3) indicating that it would be appropriate to make the correspondence a part of the record of the rezoning request. Mrs. Townshend reviewed which neighboring properties are protected by the State through conservation easements or the purchase of development rights.
Mr. Ruane moved to deny the rezoning request based on the importance of the Garrison Tract as an economic development asset, the 1999 Garrison Tract Memorandum of Understanding, and the State’s opposition to the request. The motion was seconded by Mr. Hogan and carried by a unanimous roll call vote.
ANNEXATION/REZONING PUBLIC HEARING/FINAL READING - PROPERTY LOCATED AT 446 ACORN LANE (OWNED BY THOMAS M. ROMANOWSKI)
An annexation referendum was held on November 2, 2006 for property located at 446 Acorn Lane, owned by Thomas M. Romanowski.
Referendum Results
The City Clerk reported that the referendum was held with one (1) eligible voter. Zero (0) votes were cast in favor of the annexation, and zero (0) votes were cast against annexation. In accordance with Section 1A - Procedure to extend boundaries, of the City of Dover Charter, if a majority of the votes cast in an election held in a territory proposed to be annexed shall be in favor of the inclusion of that territory, the council may thereupon adopt a resolution annexing said territory and including same within the limits of the City of Dover. If a majority of the votes cast in an election held in a territory proposed to be annexed shall be against the inclusion of that territory within the limits of the City of Dover, the proposed annexation of said territory shall be declared to have failed.
Mr. Salters moved to accept the referendum results, seconded by Mr. Carey and unanimously carried.
ANNEXATION/REZONING PUBLIC HEARING/FINAL READING - PROPERTY LOCATED AT 349 ACORN LANE (OWNED BY LUIS A. LIRANZO AND VIRGINIA RODRIGUEZ)
An annexation referendum was held on November 2, 2006, for property located at 349 Acorn Lane, owned by Luis A. Liranzo and Virginia Rodriguez.
Referendum Results
The City Clerk reported that the referendum was held with two (2) eligible voters. Two (2) votes were cast in favor of the annexation, with zero (0) votes cast against annexation.
Mr. Carey moved to accept the referendum results, seconded by Mr. Salters and unanimously carried.
Annexation
By motion of Mr. Carey, seconded by Mr. McGlumphy, Council adopted the following Resolution by a unanimous roll call vote:
A RESOLUTION APPROVING THE INCLUSION OF AN AREA WITHIN THE LIMITS OF THE CITY OF DOVER.
WHEREAS, the Charter of the City of Dover authorizes Council to extend the boundaries of the said City after a special election of the qualified voters and real estate owners of the territory proposed to be annexed, and
WHEREAS, the Mayor and Council of the City of Dover deem it in the best interest of the City of Dover to include an area contiguous to the present City limits, and hereinafter more particularly described within the limits of the City of Dover, and
WHEREAS, the Charter of the City of Dover provides that if a majority of the Votes cast in an election held in a territory proposed to be annexed shall be in favor of inclusion of that territory within the limits of the City of Dover, the Council may thereupon adopt a resolution annexing said territory and including same within the limits of the City of Dover.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN COUNCIL MET:
1. That the following described area, situated in East Dover Hundred, Kent County, State of Delaware, shall be annexed to and included within the limits of the City of Dover:
Lying on the westerly side of Acorn Lane, being bounded as follows: on the north by lands now or late of Pedro P. and Christina L. Sanchez, on the east by Acorn Lane (50 feet wide), on the south by lands now or late of Joseph S. and Josephine Pocius, on the west by lands now or late of The City of Dover, as shown on a plan prepared by McClure Associates, Inc., dated 7/23/97, file #MA:07-28-97, and being more particularly described as follows:
Beginning at a found concrete monument in the westerly line of Acorn Lane, a corner for this lot and for said lands of Sanchez, said beginning point located South 08 deg. 25 min. East, a distance of 1262.92 feet as measured along the westerly line of Acorn Lane from its intersection with the physical centerline of White Oak Road; thence from said point of beginning the following four (4) courses and distances: (1) along the westerly line of Acorn Lane, South 08 deg. 25 min. East, a distance of 100.00 feet to a found concrete monument, a corner for said lands of Pocius; (2) thence with the same, South 81 deg. 35 min. West, a distance of 170.00 feet to a found concrete monument in the line of said lands of The City of Dover; (3) thence with the same, North 08 deg. 25 min. West, a distance of 100.00 feet to a found concrete monument in line of said lands of The City of Dover, a corner for said lands of Sanchez; (4) thence with the same, North 81 deg. 35 min. East, a distance of 170.00 feet to a point, the point of beginning. Containing within said metes and bounds 0.390 acres of land, more or less. Said lot being known as #377 Acorn Lane.
Being the same lands and premises which were conveyed unto Dorothy E. Boyce by deed of Beverly Garris, dated June 6, 1990, and recorded in the Office of the Recorder of Deeds for Kent County, Delaware, in Deed Book K, Volume 48, Page 183. The said Dorothy E. Boyce, died, testate, on June 6, 1996, and Letter of Administration, C.T.A. were granted to Frederick C. Harris, Sr. on June 10, 1996. Under the provisions of ARTICLE FOUR of the Will of Dorothy E. Boyce, dated November 17, 1993, the Executor is directed to liquidate the estate and sell at public or private sale any land and all real estate and personal property owned by the decedent at the time of her death, the proceeds of such sale or sales to become a part of the decedent’s estate and distributed in accordance with the provisions therein set forth.
2. The above described property shall be annexed into the City of Dover with a zoning classification as set by City Council and in accordance with the zoning map and environs, then in force, effective upon such lands being included within the limits of the City of Dover.
3. That the certified copy of the resolution of annexation, together with a plot of the area annexed, shall be filed for record with the Recorder of Deeds of Kent County.
4. That the effective date of this resolution shall be the 13th day of November, 2006 at 12:01 a.m. o'clock.
ADOPTED: NOVEMBER 13, 2006
Public Hearing - Zoning Classification
Mrs. Ann Marie Townshend, City Planner, reviewed the Petition to Annex and Zone property and the Cost/Revenue Analysis (Exhibit #4). The Planning Commission recommended that the zoning classification of this property be approved as R-10 (One Family Residence) upon annexation.
Council President Williams declared the public hearing open. With no one present wishing to speak, the public hearing was closed.
Mr. Hogan moved that the property be zoned R-10 (One Family Residence), as recommended by the Planning Commission. The motion was seconded by Mr. Salters and by a unanimous roll call vote, Council adopted the following ordinance. (The first reading of the proposed ordinance was accomplished during the Council Meeting of August 14, 2006.)
AN ORDINANCE AMENDING THE ZONING ORDINANCE AND ZONING MAP OF THE CITY OF DOVER BY CHANGING THE ZONING DESIGNATION OF PROPERTIES LOCATED AT 349 ACORN LANE OWNED BY LUIS A. LIRANZO AND VIRGINIA RODRIGUEZ.
WHEREAS, the City of Dover has enacted a zoning ordinance regulating the use of property within the limits of the City of Dover; and
WHEREAS, it is deemed in the best interest of zoning and planning to change the permitted use of property described below from RS-1- Single-family Residential (Kent County) to R-10 - One Family Residence (City of Dover).
NOW, THEREFORE, BE IT ORDAINED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN COUNCIL MET:
1. That from and after the passage and approval of this ordinance the Zoning Map and Zoning Ordinance of the City of Dover has been amended by changing the zoning designation from RS-1 Single-family Residential (Kent County) to R-10 - One Family Residence (City of Dover) on the property located at 349 Acorn Lane, owned by Luis A. Liranzo and Virginia Rodriguez.
ADOPTED: NOVEMBER 13, 2006
SPECIAL TAX APPEALS COMMITTEE REPORT - OCTOBER 17, 2006
A Special Tax Appeals Committee meeting was held on October 17, 2006 with Chairman Ruane presiding.
Stipulations of Value
The following Stipulations were heard:
Braun Properties, LLC (Office Building) - 429 South Governors Avenue (ED-05-077.09-03-48)
Value Appealed: $554,500 Value Stipulated: $500,000
Updated appraisal submitted: $450,000 Value Requested: $450,000
Tax Abatement $ 54,500 x .0033 = $ 179.85
The committee recommended acceptance of the stipulated value of $500,000 for 429 South Governors Avenue.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
Phoenix Properties (Apartment Building) - 30 South New Street (ED-05-076.08-05-68)
Value Appealed: $1,081,000 (47,000/unit)
Value Stipulated: $ 825,000 (35,800/unit)
Value Requested: $ 550,000 (23,913/unit)
Tax Abatement $ 256,000 x .0033 = $ 844.80
The committee recommended acceptance of the stipulated value of of $825,000 for 30 South New Street.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
Edward Troise/EJT Construction (Wetlands) - 13.507 acres-Horsepond Road (ED-05-078.00-01-05)
Value Appealed: $875,000 (64,781/AC)
Value Stipulated: $ 19,000 ( 1,407/AC)
Tax Abatement $856,000 x .0033 = $ 2,824.80
Stipulation based upon recent appraisal report and telephone conference with DNREC.
Edward Troise/EJT Construction - .507 acres - Horsepond Road (ED-05-078.00-01-06)
Value Appealed: $100,800 (201,600/AC)
Value Stipulated: $ 25,000 ( 49,310/AC)
Tax Abatement $ 75,800 x .0033 = $ 250.14
Stipulation based upon recent appraisal report and telephone conference with DNREC.
The committee recommended acceptance of the stipulated values of $19,000 (ED-05-078.00-01-05)
and $25,000 (ED-05-078.00-01-06) for EJT Construction properties located on Horsepond Road.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
The following Correction was heard:
Anthony Liberto (Vacant Land) - 401-411 West Water Street (ED-05-076.12-04-39)
Value Appealed: $176,800
Demolition permits were taken out on October 28, 2004. The buildings were not inspected and remained on the tax rolls for the July 2005 and July 2006 billings. The owner requested a refund of 2005 and 2006 taxes.
Total tax = $176,800, less $130,400 for the buildings = $46,400 land value.
Refund: $130,400 x .0033 = $430.32 x 2 (years) = $860.64
The committee tabled the appeal until the City Solicitor provides an opinion on the refund.
The following Exemptions were heard:
Sunset Memorial Gardens (Cemetery) - College Road (ED-05-067.00-02-23)
Value Appealed: $67,300 - Request for exemption
Tax Abatement: $67,300 x .0033 = $222.09
The property is non-profit and was granted exempt status from Kent County in 2001.
The committee recommended acceptance of the Incorporation Papers in lieu of the 501(c)3 documentation.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
The committee recommended approval of the exempt status.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
State of Delaware (Vacant Land) - 32.6 Acres - White Oak Road (ED-05-068.00-01-04)
Value Appealed: $643,900 - Request for exemption
Tax Abatement: $643,900 x .0033 = $2,124.87
State of Delaware - 4.2 Acres - White Oak Road (LC-05-068.00-01-03.01)
Value Appealed: $104,200 - Request for exemption
Tax Abatement: $104,200 x .0033 = $343.86
State of Delaware - 444 West Water Street (ED-05-077.13-01-03)
Value Appealed: $112,000 - Request for exemption
Tax Abatement: $112,000 x .0033 = $369.60
The committee recommended approval of the exempt status for all three properties.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
City of Dover (Vacant Land) - 12.5 Acres - Hazlettville Road (ED-05-076.00-02-04.02)
Value Appealed: $316,300 - Request for exemption
Tax Abatement: $316,300 x .0033 = $1,043.79
Total Abated Tax: $ 9,064.44
The committee recommended approval of the exempt status.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
The following Withdrawal was heard:
Capitol Cleaners & Launderers (Vacant Land) - 411 S. Governors Avenue (ED-05-077.09-03-37)
Value Appealed: $26,400 No Value Requested
An appraisal was requested on August 22, 2006 and, as of October 4, 2006, the appraisal had not been submitted. Requested appraisal October 3, 2006 - received email withdrawing email request.
Staff provided an update on the status of the following pending appeals:
Robino-Bay Court Plaza (Shopping Center)
JC Penney Co. Inc. (Department Store)
Dimple LLC (Hotel - Ramada Inn)
The Duncan Center (Office Building)
Tax Appeal Procedures, Rules and Regulations
The discussion on Tax Appeal Procedures, Rules and Regulations was deferred to a later date.
USPAP and IAAO Standards Adoptions
The discussion on USPAP and IAAO Standards Adoption was deferred to a later date.
Chairman Councilman Ruane asked that the committee reconvene at the earliest date possible.
By consent agenda, Mr. Carey moved for acceptance of the Special Tax Appeals Committee Report, seconded by Mr. Salters and carried by a unanimous roll call vote.
SPECIAL TAX APPEALS COMMITTEE REPORT - OCTOBER 30, 2006
A Special Tax Appeals Committee meeting was held on October 30, 2006 with Chairman Ruane presiding.
Solicitor’s Opinion Regarding Anthony Liberto (Vacant Land) - 401-411 West Water Street (ED-05-076.12-04-39)
The committee recommended denial of the request for a refund on the 2005 and 2006 real estate property taxes, predicated upon demolition of improvements.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
Tax Appeal Procedures, Rules & Regulations
Staff recommended adoption of Tax Policy 1- HUD Settlement Sheet.
The committee recommended approval of staff’s recommendation.
By consent agenda, Mr. Carey moved for adoption of Tax Policy 1 - HUD Settlement Sheet (as on file in the Office of the City Clerk), seconded by Mr. Salters and carried by a unanimous roll call vote.
Staff recommended adoption of Tax Policy 2- IAAO and USPAP Standards and Ethics.
The committee recommended approval of staff’s recommendation.
By consent agenda, Mr. Carey moved for adoption of Tax Policy 2 - IAAO and USPAP Standards and Ethics, with rectifications (as on file in the Office of the City Clerk), seconded by Mr. Salters and carried by a unanimous roll call vote.
Staff recommended adoption of Tax Policy 3- Tax Appeal Policy.
The committee recommended approval of staff’s recommendation.
By consent agenda, Mr. Carey moved for adoption of Tax Policy 3 - Tax Appeal Policy, with rectifications (as on file in the Office of the City Clerk), seconded by Mr. Salters and carried by a unanimous roll call vote.
USPAP and IAAO Standards Adoption
Staff recommended adoption of the 2006 USPAP and the Real Property Appraisal Process.
The committee recommended approval of staff’s recommendation.
By consent agenda, Mr. Carey moved for adoption of USPAP and IAAO Standards (as on file in the Office of the City Clerk), seconded by Mr. Salters and carried by a unanimous roll call vote.
By consent agenda, Mr. Carey moved for acceptance of the Special Tax Appeals Committee Report, seconded by Mr. Salters and carried by a unanimous roll call vote.
UTILITY COMMITTEE REPORT - OCTOBER 23, 2006
The Utility Committee met on October 23, 2006, with Chairman Carey presiding.
Annexation Request- Property Located on the South Side of Route 8, Between Artis Drive and Dover, Owned by Calvary Baptist Church; and Property Located on the South Side of Route 8 Between Mifflin Road and Artis Drive, Owned by Jireh Christian Center, Inc.; and Property Located on the Southeast Side of Route 8, Owned by Donato Poliseno; and Property Located at 1550 Forrest Avenue, Owned by Alice Taraila; and Property Located at 1538 Forrest Avenue, Owned by Robert J. Harvey, Sr.
Members were provided the Petition to Annex and Zone Property and a Cost/Revenue Analysis Summary for property located on the south side of Route 8, between Artis Drive and Dover, owned by Calvary Baptist Church; and property located on the south side of Route 8 between Mifflin Road and Artis Drive, owned by Jireh Christian Center, Inc.; and property located on the southeast side of Route 8, owned by Donato Poliseno; and property located at 1550 Forrest Avenue, owned by Alice Taraila; and property located at 1538 Forrest Avenue, owned by Robert J. Harvey, Sr.
Mrs. Ann Marie Townshend, Director of Planning and Inspections, advised the committee that the annexation was initiated by the City in an effort to fill in the existing enclave. City of Dover water and electric services are available to the properties; however, a sewer pumping station would be required to extend sewer services to these properties. It is anticipated that when the adjacent Carey Farm is developed this will be addressed. Mrs. Townshend stated that the Cost-Revenue analysis showed a positive cash flow to the City of approximately $1,124 over ten years.
The committee recommended adoption of a resolution setting the annexation referendum for property located on the south side of Route 8, between Artis Drive and Dover, owned by Calvary Baptist Church; and on the south side of Route 8 between Mifflin Road and Artis Drive, owned by Jireh Christian Center, Inc.; and property located on the southeast side of Route 8, owned by Donato Poliseno; and property located at 1550 Forrest Avenue, owned by Alice Taraila; and property located at 1538 Forrest Avenue, owned by Robert J. Harvey, Sr.
Mrs. Townshend advised members that correspondence had been received from Alice Taraila, 1550 Forrest Avenue (Exhibit #5) and Robert J. Harvey, Sr., 1538 Forrest Avenue (Exhibit #6) requesting that their applications for annexation be withdrawn due to the proposed amendments to the zoning code regarding recreational vehicles.
Mr. Hogan moved for approval of the applicants’ request to withdraw their annexation/rezoning applications, seconded by Mr. Carey and carried by a unanimous roll call vote.
Mr. Hogan moved for approval of the committee’s recommendation. The motion was seconded by Mr. Carey and, by a unanimous roll call vote, Council adopted the following Resolution:
A RESOLUTION PROPOSING THE INCLUSION OF AN AREA WITHIN THE LIMITS OF THE CITY OF DOVER AND CALLING FOR A SPECIAL ELECTION TO BE HELD IN THE SAID AREA.
WHEREAS, the Charter of the City of Dover authorizes Council to extend the boundaries of the said City after a special election of the qualified voters and real estate owners of the territory proposed to be annexed, and
WHEREAS, the Mayor and Council of the City of Dover deem it in the best interest of the City of Dover to include an area located on the south side of Route 8, between Artis Drive and Dover; and an area located on the south side of Route 8 between Mifflin Road and Artis Drive; and an area located on the south east side of Route 8 which is contiguous to the present City limits, into the limits of the City of Dover and within a zoning classification as recommended by the City of Dover Planning Commission.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN COUNCIL MET:
1. That a special election be held for an area located on the south side of Route 8 between Artis Drive and Dover; and an area located on the south side of Route 8 between Mifflin Road and Artis Drive; and an area located on the south east side of Route 8 situated in East Dover Hundred, Kent County, State of Delaware.
2. That the election be held on the 14th day of DECEMBER, 2006 commencing at the hours of 11:00 a.m. in the City Hall Annex, 15 E. Loockerman Street, Dover, Delaware, for the purpose of submitting the question of annexation of the above areas to those persons entitled to vote thereon.
3. That the election be held and conducted pursuant to the provisions of the Charter of the City of Dover as amended.
4. That this resolution be published in accordance with the City of Dover Charter.
ADOPTED: NOVEMBER 13, 2006
Annexation Request - Property located at 1166 South Bay Road, owned by William M. and Delois M. Shirey, Trustees
Members were provided the Petition to Annex and Zone Property and a Cost/Revenue Analysis Summary for the property located at 1166 South Bay Road, owned by William M. and Delois M. Shirey, Trustees.
Mrs. Townshend advised members that City of Dover electric service is currently used and water services can be extended to this property. Sanitary sewer will be provided by Kent County. The Cost-Revenue analysis showed a positive cash flow to the City of approximately $42,574 over ten years. Mrs. Townshend advised members that, due to time constraints, no other properties were approached; however, staff will make contact with them. She also stated that during the pre-application process, staff will contact the contiguous property owners regarding their interest in participating in the annexation. Mr. Ruane stated that it was his understanding that in the past, the Committee endorsed the process of contacting adjacent property owners to encourage a group annexation rather than one property at a time.
The committee recommended adoption of a resolution setting the annexation referendum for property located at 1166 South Bay Road, owned by William M. and Delois Shirey, Trustees.
By consent agenda, Mr. Carey moved for approval of the committee’s recommendation. The motion was seconded by Mr. Salters and, by a unanimous roll call vote, Council adopted the following Resolution:
A RESOLUTION PROPOSING THE INCLUSION OF AN AREA WITHIN THE LIMITS OF THE CITY OF DOVER AND CALLING FOR A SPECIAL ELECTION TO BE HELD IN THE SAID AREA.
WHEREAS, the Charter of the City of Dover authorizes Council to extend the boundaries of the said City after a special election of the qualified voters and real estate owners of the territory proposed to be annexed, and
WHEREAS, the Mayor and Council of the City of Dover deem it in the best interest of the City of Dover to include an area located at 1166 South Bay Road, which is contiguous to the present City limits, into the limits of the City of Dover and within a zoning classification as recommended by the City of Dover Planning Commission.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN COUNCIL MET:
1. That a special election be held for an area located at 1166 South Bay Road situated in East Dover Hundred, Kent County, State of Delaware.
2. That the election be held on the 14th day of December, 2006 commencing at the hours of 11:00 a.m. in the City Hall Annex, 15 E. Loockerman Street, Dover, Delaware, for the purpose of submitting the question of annexation of the above area to those persons entitled to vote thereon.
3. That the election be held and conducted pursuant to the provisions of the Charter of the City of Dover as amended.
4. That this resolution be published in accordance with the City of Dover Charter.
ADOPTED: NOVEMBER 13, 2006
During the committee meeting, Mr. Carey suggested that previous meeting minutes be researched to determine if the issue of staff contacting contiguous properties whenever there is a request for annexation had been previously discussed. If previous action has not occurred, the item will be considered during the next meeting of the Utility Committee.
The committee recommended that staff research previously adopted policies related to contacting contiguous properties regarding their interest in annexation.
By consent agenda, Mr. Carey moved for approval of the committee's recommendation, seconded by Mr. Salters and carried by a unanimous roll call vote.
PACE and NAES Quarterly Report
Mr. James Utt, Director of Pace Global Asset Management, provided an update for the last three months of the PACE contract with the City of Dover, which included asset operations, energy management and power purchases, risk management and market monitoring.
Mr. DePrima advised members that monthly PACE and NAES (North American Energy Services) updates have been added to the City Managers monthly report.
Mr. Ken Beard of NAES provided an update of the operations at the McKee Run and Van Sant substations. He indicated that the staff transition from Duke Energy to NAES has been completed and staff has been reduced by 10%, resulting in a savings of approximately $300,000. Union negotiations have been completed with the result of the union’s vote to be announced shortly.
Responding to Mr. Ruane, Mr. Beard explained that the reduced hours recorded for the McKee Run station, which was 10% below the three (3) year average for the month of August, was due to the milder summer temperatures. Mr. Utt indicated that during the summer months, when less power was generated and purchased, the net gross earned was lower than expected. He also explained that McKee Run will operate when temperatures are very hot or very cold.
Mr. Utt provided additional information regarding the pre-purchase of power during on-peak hours (8:00 a.m. to 11:00 p.m. weekdays) and off-peak hours (11:00 p.m. to 7:00 a.m. weekends and holidays). Based on projections for the remaining number of purchases through the end of the power year, in conjunction with purchases that have been contracted for, it is expected that the City’s wholesale power price will be below the target of $84 per megawatt hour. He also explained PACE’s position in the day ahead market, when placing bids for the City. Mr. Utt stated that there are currently 1.8 million gallons of fuel oil on site and replacement is very important.
Responding to Mr. Ruane, Mr. Utt explained the procurement of 95% of Dover’s on-peak needs. He stated that based on the on-peak volume for the last three (3) years, PACE will purchase power in 5-10 megawatt hour blocks to meet the on-peak need. Mr. Utt noted that 99% of the City’s off-peak need has also been purchased. He advised members that this is common practice for many municipalities and PACE has recommended that the City continue this practice for the coming fiscal years. PACE will provide benchmarks for the procurement of power in fiscal 2008 and 2009.
Responding to Mr. Carey, Mr. Utt provided further information regarding PACE’s ability to purchase power ahead of the markets. Since the contract was initiated in May, there was not sufficient time to implement a managed procurement position. PACE did not recommend that the City take a real time price risk, which could have cost four to five times more than the price of power provided by PACE. In the coming year, power will be purchased in smaller blocks to realize a savings if the power market becomes unstable or if prices rise.
Mr. DePrima emphasized staff’s efforts to keep the price of power at $84 per megawatt hour this fiscal year.
Mr. McGiffin questioned why the names of the counter parties, from which the City purchases power, are kept confidential. Mr. Utt responded that the contracts signed with the counter parties contain a confidentiality provision, to ensure competitive pricing. Mr. DePrima indicated that the names of the counter parties (Connectiv, Constellation, WPS and BP) are contained in the monthly report submitted by PACE.
Responding to Mr. Slavin, Mr. DePrima explained that in order to prepare the next fiscal year’s budget, PACE will provide cost estimates in March for the coming power year.
Mr. Utt, responding to Mr. McGlumphy, indicated that PACE will recommend the right time to purchase power based on several different parameters, including the historic movements of the market. Mr. McGlumphy questioned if Mr. Utt was aware that the revenue generated from the electric utility plays a part in the decision to purchase power. Mr. Utt advised members that PACE has negotiated agreements with counter parties which allow the subsequent sale of the purchased power at a later date.
Mr. DePrima informed members that the transfer of $5M from the Electric Revenue Fund to the General Fund does not play a role in the decision making process regarding power rates. He clarified that the transfer rate, which includes distribution and other associated costs, is layered on top of the $84 per megawatt hour which, in previous years, has been approximately 8% of gross revenue. Mrs. Tieman, Senior City Administrator, indicated that the transfer for this fiscal year is approximately 7% and is not passed on to residents via property taxes. This applies to all rate payers, inside and outside of the City limits.
Mr. Utt informed members that PACE is preparing a market valuation of the McKee Run and Van Sant stations. The Federal Energy Regulatory Commission is currently establishing rules for the capacity market. These rules are due to be published in 2007 and will be good for the City’s substations because it will place a higher value on capacity. Existing capacity regulations require the City to have on hand, or purchase from the market, a certain amount of capacity. The City has approximately 171 megawatts of capacity at the McKee Run and Van Sant stations. Based on the City’s historic peak needs, 177 megawatts of capacity is currently required at both substations and has been purchased by PACE. Responding to Mr. Ruane, Mr. Utt explained that the regulations will not increase cash flow to the City, but will increase the value of the substations.
Mr. Utt explained that the current expenses have been over budget by approximately 20% and will be examined again prior to the end of the year. The additional $4.5M cost expenditure does not include the additional revenue from the sale of emission allowances or any cost reductions at either station. Weekly communication continues with NAES in an effort to reduce costs at both stations when they are not operational.
Responding to Mr. Ruane, Mr. Utt explained that the gross margin generated by the stations for energy capacity and black starts is below the original June budget by $4.5 million. Mr. Utt also explained that he expects the margin the shrink by the end of the year and will include the revenue from the sale of emissions allowances.
Mr. DePrima stated that when the contract with Duke Energy expired, the City did not know if McKee Run and Van Sant made a profit. Several attempts to obtain this information from Duke Energy have been unsuccessful. Staff recommended, for this budget year, that the funds to cover the additional expenses be taken from reserves and rate increases.
The committee took no further action.
Burns and McDonnell - Rate Analysis
Mr. DePrima reminded members that, during the presentation in June, it was stated that an analysis would be conducted to identify any adjustments.
Mr. Ted Kelly of Burns & McDonnell provided members with an update and analysis of the electric rate adjustments. He stated that the overall rate increase implemented in July 2006 amounted to 22.5% not 38%, as originally stated. He also outlined $3.2 million of additional need that was not anticipated in June.
Responding to Mr. Slavin, Mr. Kelly provided additional information regarding $964,000 of lost revenue as a result of the Duke Energy contract expiring. These funds were included in the first rate analysis in error.
Responding to Mr. Salters, Mr. Kelly explained the PACE incentive fee that was not part of the analysis performed in June. The incentive fee is included in the original contract and will be payable to PACE if targets are met and costs are reduced. Mr. DePrima explained that this incentive is to be paid in the following fiscal year; however, for accounting purposes, it is recorded during this fiscal year. Other expenses include the transfer to the General Fund of approximately 6.5% of revenue, which is lower than the amount transferred in previous years.
Mr. Kelly provided information regarding the City’s debt service coverage ratio. The updated ratio, which does not include the transfer from the rate stabilization fund but does include additional funds from a rate increase effective in January, will allow the City to have a positive debt service coverage.
The actual rate increases, scheduled to take effect in January and July 2007, will be presented to the Committee when the numbers have been put through the appropriate billing models.
Responding to Mr. McGlumphy, Mr. Kelly stated that the anticipated rate increases will take effect in January and July of 2007. If the power plants report net losses, an additional 6% rate increase would be implemented in July, which brings the total rate increase in 2007 to 14%. Mr. DePrima indicated that funds from the rate stabilization will not be available next year. He also explained that electric rates increased between 12-16%, depending on rate classifications.
Mr. Hogan stated that the proposed 8% rate increase will vary depending on the rate class and could be less for residential customers. He suggested being more cautious when discussing the possible rate increase percentages because they apply system wide.
Mr. DePrima stated that if the market price decreases, the proposed 14% will not be necessary; however, if the markets increase, the same proposed percentage may increase. He also stated that if the operating expenses of the power plants can be reduced in the coming year, it will effect the percentage, in addition to the sales of the emissions allowances.
Mr. Hogan suggested that when discussing the proposed increases they be presented in a range, until a final percentage is realized.
Responding to Mr. Ruane, Mr. Kelly stated that the debt service coverage ratio required in the bond covenant is 1.25 times. Mr. DePrima stated that the City will be below that mark this fiscal year. Mrs. Donna Mitchell, Finance Director, stated that she has been in contact with the rating agencies and they have informed her that if the City is not below the covenants in the future, they will be satisfied. She stated that the rating agencies have approved the use of the rate stabilization fund, and if