Council Work Session

Summary

Meeting Overview

The Lexington-Fayette Urban County Council met on May 13, 2014, at 3:00 p.m. in the Council Chamber on the 2nd Floor of the Government Center, with Mayor Gray presiding. The council addressed 10 agenda items during the session, including public comment periods, zoning matters, budget amendments, and various reports. The body took 13 motions and votes and heard 7 public comments from members of the community. Key actions included approval of requested rezonings and docket items, budget amendments, new and continuing business matters, and the mayor's report. The meeting concluded with adjournment following the completion of all scheduled business.

Attendance

Present: Gorton, Ellinger, Kay, Ford, Akers, Lawless, Beard, Farmer, Stinnett, Scutchfield, Myers, Clarke, Henson, and Lane

Absent: Mossotti

Late: None

Votes and Decisions

All votes during this meeting were conducted by voice vote and passed unanimously.

Procedural Approvals [timestamp: 00:04:00–00:05:08]

The Council approved the docket for the May 8, 2014 Council meeting (motion by Farmer, seconded by Gorton). The summary of the work session of May 6, 2014 was approved (motion by Beard, seconded by Scutchfield). Budget amendments were approved (motion by Gorton, seconded by Myers). Approval of new business was granted (motion by Beard, seconded by Gorton).

Senior Citizen Center Project 6:41

The Council approved amendment L0452-14 to the agreement with EOP Architects to include design services for Phase B, C, and D of the Replacement Senior Citizen Center (motion by Gorton, seconded by Ellinger). The total cost increases to $769,470.

Street Closure Authorization 8:51

Authorization to close Prospect Avenue and a portion of Simpson Avenue was approved under L0467-14 (motion by Martin).

HUD Loan Guarantee Program 47:34

The Council authorized execution of a Funding Approval/Agreement with the U.S. Department of Housing and Urban Development under the Section 108 Loan Guarantee Program for the 21c Hotel Museum Project, identified as L0468-14 (motion by Gooding, seconded by Hamilton). This approval is conditioned upon HUD approval of the repayment schedule, loan closure by June 30, 2015, a second mortgage on the property, and required personal guarantees.

Additional Approvals [timestamp: 00:48:05–01:04:00]

Neighborhood Development Funds were approved (motion by Ellinger, seconded by Akers). The Budget Committee of the Whole summary was approved (motion by Gorton, seconded by Henson). The Mayor's report was approved (motion by Gorton, seconded by Henson).

Closed Session and Adjournment [timestamp: 01:05:05–01:40:42]

The Council moved into closed session for employee appointment discussions pursuant to KRS 61.810.1F (motion by Gorton, seconded by Scutchfield). The Council subsequently returned to open session. The meeting was adjourned (motion by Gorton, seconded by Kay).

Budget and Financial Actions

The meeting on May 13, 2014 addressed fourteen financial items totaling approximately $6.8 million in contracts, grants, and appropriations.

Facility and Infrastructure Contracts

The Division of Community Corrections received two separate agreements: a change order (L0413-14) with EC Matthews, Co., Inc. for $19,420.00 to replace an arch entryway, and an annual maintenance agreement (L0414-14) with Siemens Industry, Inc. for $24,635.00 for fire alarm services.

Rose Street Project Funding

Two items addressed the Rose Street bike lane project. Supplemental Agreement No. 2 (L0437-14) with the Kentucky Transportation Cabinet provided $25,000.00 in additional federal funds. A separate agreement (L0440-14) with Kentucky American Water Company allocated $25,910.00 for utility relocation on Rose Street.

Senior Citizen Center and Police Facility

An amended agreement (L0452-14) with EOP Architects for design services on Phases B, C, and D of the Replacement Senior Citizen Center totaled $604,555.00. An amendment to Resolution #16-2013 (L0443-14) increased funding by $47,037.00 for an environmental project at the Police Canine Facility.

Grants and Funding Programs

The meeting approved an application (L0434-14) for $13,750.00 under the Law Enforcement Protection Program from the Kentucky Office of Homeland Security for soft body armor vests. A major funding approval (L0468-14) granted $6,000,000.00 through the Section 108 Loan Guarantee Program from the U.S. Department of Housing and Urban Development for the 21c Hotel Museum Project. Additionally, fifteen Sustainability Grants (L0472-14) totaling $30,260.00 were awarded to local organizations.

Utility and Service Agreements

A change order (L0459-14) with Hazen and Sawyer Environmental Engineers and Scientists allocated $52,000.00 for annual sanitary sewer CMOM implementation services. A minor change order (L0462-14) with the Kentucky Transportation Cabinet provided $2,053.06 for traffic signal equipment for Tates Creek Road Sidewalk Improvements.

Additional Items

The meeting also addressed an amendment to a lease agreement (L0433-14) with Alfalfa Restaurant, LLC regarding natural gas payment and rent suspension, a Letter of Agreement (L0435-14) with God's Pantry Food Bank, Inc. for client referrals, and acceptance of a private road dedication (L0449-14) north of Richmond Road Home Depot from Anderson Communities, Inc. for public use.

Public Comment

Several council members raised questions and concerns during discussion of the meeting's agenda items.

Section 108 Loan for 21c Hotel Museum Project

Council Member Farmer 8:20 expressed concern about the project's impact on CDBG funds and requested clarification on the developer's financial wherewithal and the project's connection to historic preservation.

Council Member Ford 17:37 raised questions about whether the project qualifies as a public project, the existence of a financing gap, and how the risk compares to other downtown developments.

Council Member Lane 22:19 expressed confidence in the loan, citing the second mortgage position and personal guarantees from developers as mitigating factors.

Council Member Myers 23:37 asked for details on job classifications and wages, and confirmed that no local tax abatement exists beyond TIF.

Council Member Henson 43:07 expressed concern about the project's reliance on low-income job creation and suggested implementing a guarantee that employees would not remain low-income after being hired.

Suburban Mobile Home Park Shelter Project

Council Member Akers 55:24 expressed disappointment over the loss of a $990,000 federal grant due to legal hurdles and called for community action to restore the shelter.

Repaving Budget

Council Member Beard 1:00:40 highlighted the need for additional funding to address road deterioration, noting that the current budget of $3 million is insufficient.

Appointments

David Holmes was appointed Commissioner of Environmental Quality and Public Works.

Contested Items

Section 108 Loan for 21c Hotel Museum Project

A heated discussion arose regarding a proposed Section 108 Loan for the 21c Hotel Museum Project. Council members raised multiple concerns about the initiative's viability and appropriateness for public funding.

The primary points of contention included:

• Financial Risk: Council members questioned the financial risk associated with the project and expressed concerns about the security of public investment.

• Project Classification: Debate centered on whether the project qualified as a public project, with implications for its eligibility for certain funding mechanisms.

• Fund Appropriateness: Disagreement emerged over the justification for using Community Development Block Grant (CDBG) funds for this initiative.

• Job Quality: Council members raised questions about the quality of jobs that would be created through the project.

• Developer Financials: Concerns were voiced regarding the financial stability and credentials of the project developer.

• Community Development Alignment: Discussion focused on whether the project adequately aligned with stated community development goals and priorities.

The contested nature of these issues reflects broader questions about how public resources should be deployed, what constitutes appropriate use of community development funding, and what standards should apply to public-private partnerships in economic development initiatives.

Public Comment - Issues on Agenda

A public comment session was opened to allow members of the public to address issues on the agenda. However, no speakers came forward to provide comments during this period. The hearing was closed at 3:05 PM.

Requested Rezonings/Docket Approval

4:00

The Council considered approval of the docket for the May 8, 2014 Council meeting. Key speakers on this agenda item included Farmer, Henson, Beard, and Gorton.

A motion to approve the docket for the May 8, 2014 Council meeting passed without dissent. Following this approval, additional motions were made to place new ordinances and resolutions on the docket. These motions also passed.

The outcome of this agenda item was approval of all requested docket items.

Approval of Summary

A motion to approve the summary of the May 6, 2014 work session was presented to the body. 4:31

Key speakers on this item included Beard and Scutchfield.

The motion passed without dissent.

Budget Amendments

A motion to approve budget amendments was presented as agenda item IV and passed without dissent 5:08.

Key Speakers

Gorton and Myers led the discussion on the budget amendments.

Items Discussed

Several journal entries were reviewed and discussed as part of the amendments, including:

• Adjustments for energy management projects
• Overtime reimbursements
• Loan matches

Outcome

The motion to approve the budget amendments was approved without dissent.

New Business

A motion to approve new business passed during this portion of the meeting 5:08. Several items were discussed and addressed by the council.

Items Discussed

The following matters were brought before the council:

• A change order for the Senior Citizen Center design
• Closure of streets
• A Section 108 loan for the 21c Hotel Museum Project

Key Participants

The following individuals participated in the discussion of new business items: Beard, Gorton, Ellinger, Farmer, Ford, Lane, Myers, and Henson.

Outcome

The motion to approve new business was approved.

Continuing Business/Presentations

During this agenda item, the council received a presentation on Neighborhood Development Funds (NDFs) and heard a Budget Committee of the Whole summary 48:05.

Vice Mayor Gorton presented the Budget Committee of the Whole summary. The presentation included discussion of Neighborhood Development Funds, which were brought before the council for approval.

Key speakers during this segment included Ellinger, Akers, and Vice Mayor Gorton.

Outcome: The Neighborhood Development Funds were approved by the council.

Council Reports

Vice Mayor Gorton presented updates on two significant community initiatives during this agenda item.

Family Care Center Anniversary

Vice Mayor Gorton reported on the celebration of the 25th anniversary of the Family Care Center, marking a quarter-century of service to the community.

Lexmark Donation to Northside YMCA

Vice Mayor Gorton also announced a $1.5 million donation to the Northside YMCA by Lexmark, representing a major contribution to the organization's operations and programs.

Outcome

This item was presented for informational purposes, with no formal action required.

59:35

Mayor's Report

The Mayor's Report was presented during the meeting, with key speakers Gorton and Henson participating in the discussion 1:04:00.

A motion to approve the Mayor's report was brought before the council and passed without dissent.

Public Comment - Issues Not on Agenda

1:04:30

No members of the public signed up to provide comment on issues not on the agenda. The public comment period proceeded without any public input.

Adjournment

A motion to adjourn the meeting was presented by Gorton and Kay. The motion passed without dissent. 1:40:42