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3 "76 STUDY SESSION (continued) 2. Parkwood 101 Buy-In Costs - GID No. 1-64 (reports referenced on page 2) City Manager Fales reported that during the break, Bob Field, General Manager of ,,,,r Parkwood 101 Associates, had indicated to him that his firm had made a decision which may, or may not, necessitate "walking through" the report. He referred to the two alternatives decided upon, the Municon benefit assignment approach, akin to assessment district financing where all of the to-date expenditures of the District that would be of benefit to the Parkwood 101 property is calculated, and then accelerated construction value is assigned to that. This also assumed that they did not annex and that a future facilities charge would be applicable to that property. All the Municon report would do would be to get them even to the present and make them equal in terms of cost sharing to the rest of the property in the District. Mr. Fales then referred to the second alternate, outlined in the report by the Director of Finance of July 31, 1980, which used as a methodology the assumption that the Parkwood property had been in the District since its formation, then re- constructing the property taxes that the property would have paid to date for the facilities constructed by the District. However, that alternative anticipated that immediately after paying back taxes, Parkwood 101 would annex to the District. Mr. Fales advised that Mr. Field had indicated that with the absence of the add-on of 1980-1981 taxes, the recommendation of the Director of Finance for a total value of $456,338 in back taxes, plus 1980-1981 pro rated, is acceptable to his company, and after such payment is made to the District, they would annex their property to the District. Robert F. Field, General Manager, Parkwood 101 Associates, commended staff for the work involved in determining the buy-in cost, and added that his company looked at this thoroughly with respect to what they would gain or lose by such an approach, and recognizing inflation factors and the fact that facilities will be more ex- pensive in the future, and that if they were to be a separate entity in their facilities to be built in the future, they could end up losing, and would be better off buying in on that basis. He said that in a meeting this week the de- cision was made to go ahead, and if the figure of $456,338 was reasonable to the District and City Council, then they would also consider it fair and reasonable. He referred to his letter of August 15 in which he had arrived at what he believed awe was a reasonable annexation fee of a much lower figure, but stated that they have no desire to negotiate th4t fee, and that they consider $456,338 as reasonable. Mr. Fales responded to questions by Council, that the payment would be placed in a special trust fund for use for District purposes only, and suggested that it be used to fund the same account into which the proceeds of the facilities charges would be deposited. He added that it was his intention on October 27 to give Council a current status report on the existing bond projects, which may have an impact on what Council ultimately decides to do with this money. In response to questions by Council, Mr. Field advised that they intend to move ahead as quickly as possible. Mayor Biagi stated that another meeting will be scheduled regarding the financing plan for future improvements. Adjournment: Upon motion duly made, seconded and carried, the Council adjourned the Study Session at 11:30 a.m. FRANCES I. REGGETTS Deputy City Clerk Adj.Reg.Mtg. 10/11/80 Page 8 •