[0:00] I suspend our Town Council meeting and commence with our Rancho Cerrita Community Facilities District meeting.

[0:06] Hereby call this meeting to order, and Madam Clerk may have a roll.

[0:10] Board Member Braco.

[0:13] Here.

[0:14] Board Member Davis.

[0:15] Here.

[0:16] Board Member Hicks.

[0:17] Here.

[0:18] Board Member Luss.

[0:19] Here.

[0:20] Board Member Morales.

[0:21] Here.

[0:22] Vice Chairperson Egber.

[0:23] Here.

[0:24] Chairperson Murphy.

[0:25] Here.

[0:26] Quorum present.

[0:27] Thank you.

[0:28] The public is invited to address the District Board on any issue which tonight's consent agenda

[0:33] or any issue which the District Board can lawfully act upon at a future meeting pursuant to Arizona Open Meeting Laws.

[0:39] The District Board may not discuss items, but individual members of the District Board may respond to criticism

[0:44] made by those who have addressed the District Board, may ask staff to review the matter,

[0:48] and may ask the matter to be placed on a future agenda.

[0:51] I don't have any call to the public cards for the Rancho Cerrita Community Facilities District.

[0:56] If I'd like to address the Board, this would be the time.

[0:59] Seeing no movement, I will close the call to the public and move to item number four,

[1:04] which is the Consent Agenda and their chain of motion at this time.

[1:07] So moved.

[1:08] Second.

[1:09] All those in favor signify by aye.

[1:11] Aye.

[1:12] Aye.

[1:13] Any opposed?

[1:14] Motion carries.

[1:16] Now we move to item number five.

[1:18] Madam Clerk.

[1:19] Discussion and possible action to direct staff to prepare a study of the feasibility

[1:23] and benefits of issuing general obligation bonds to acquire public infrastructure.

[1:28] Thank you.

[1:29] Mr. Marriotti, our District Treasurer will present this,

[1:32] and Mr. Rossi, on behalf of Rancho Cerrita, is here if you want to say a few words

[1:37] or clarify any questions, but this time I'll turn it over to our District Treasurer.

[1:42] Thank you, Mr. Chairman, members of the Board.

[1:44] We recently received an application from the CFD developer that requested

[1:49] that the district would issue general obligation bonds

[1:52] in the amount of $18.158 million for the acquisition of public infrastructure.

[1:59] The map's a little hard to see up on the screen there.

[2:02] Your handouts are going to be a little bit easier for you,

[2:04] but you'll notice that most of the infrastructure that we're talking about

[2:07] and the $18 million issuance would pay for roadways as well as sewer lines,

[2:12] and all of this is located within the CFD boundaries.

[2:16] Most of this infrastructure that we're talking about

[2:18] has already been contemplated within the development agreement.

[2:22] We have nearly $51 million of bonding capacity that's available out of the original $60 million

[2:28] that was authorized back in the 2014 bond election,

[2:33] which took place in August of 2014.

[2:36] But before bonds are issued, the state statutes require that the CFD board

[2:40] cause a study of the feasibility and benefits of the project

[2:43] to be studied and analyzed in a report to be produced

[2:46] and presented in a public meeting.

[2:48] And that's why we're here today to seek your authorization

[2:50] to move forward with a feasibility report.

[2:53] And if you approve, staff will retain the services of our financial team

[2:56] and bond consultants to go ahead and put that study together for you,

[3:00] and then we would plan to bring that back to you,

[3:02] hopefully at our next meeting in January.

[3:05] So with that, if you have any questions,

[3:07] Mr. Orassi representing the developers here

[3:09] to answer any questions you may have and may have a short presentation.

[3:12] Yeah, I'll turn it over.

[3:16] What's the color of the gift?

[3:18] Rising to the occasion.

[3:20] Mr. Mayor, members of the Council, Michael Orassi

[3:26] appearing on behalf of the Rancher Solity to Development Company.

[3:30] And very brief presentation tonight.

[3:34] This is really just kicking off the feasibility study.

[3:38] This is the third one of these you will have done

[3:41] for the Rancher Solity to Community Facilities District.

[3:45] The first bond issuance was approximately 5.5 million.

[3:54] Last one we did.

[3:56] March of 18 months ago was only 3.75 million,

[4:01] much smaller right at the beginning of the COVID pandemic.

[4:06] I remember being on the phone with your town council

[4:11] and financial advisors and being asked,

[4:14] are you guys sure you still want to go forward?

[4:17] We said, yeah, we're going to go forward.

[4:19] We'll take the risk.

[4:21] Well, had we known, that issuance should have been double the size it was

[4:27] because the market has just really taken off,

[4:31] especially in the last six or eight months.

[4:34] I had had a number of discussions with your staff

[4:38] talking about the size of the last issuance, 3.7 million.

[4:42] It's not very efficient.

[4:44] There are a lot of fixed costs in doing these

[4:47] that are the same if you do 3 million or 30 million almost.

[4:52] And at that time, and this was a year ago,

[4:55] I said, yeah, yeah, we'll be in with at least 6 or 8 million.

[4:58] Well, the 6 turned to 12, turned to now 18.

[5:03] And we almost came in at closer to 26,

[5:07] but we couldn't get the engineering done for Region 8.

[5:11] In fact, we were hoping to have this application into you four to six months ago,

[5:16] but the engineers are so backed up,

[5:19] the cost estimates and the other base information

[5:23] your consultants have to have to do the study.

[5:26] We couldn't get done, but we are here now.

[5:29] This is all the remaining Region 7 and Region 9 infrastructure.

[5:34] It's exactly like the prior two issuances.

[5:37] It includes essentially the roads and sewers,

[5:41] and we've already accelerated the construction

[5:46] of part of Rancho Soliti to Boulevard.

[5:48] So we bid and are moving to construction on a phase

[5:51] that wasn't even in the last CFD.

[5:54] That'll get reimbursed from this.

[5:58] And we're just excited about it.

[6:00] We haven't seen this level of builder interest, home sales and pricing

[6:05] since before the Great Recession.

[6:07] We have builders signed up, not closed,

[6:10] but either a letter of intent on every portion of Region 7 and 9

[6:16] all the way down to the southern end of the project.

[6:19] So trying to move as quickly as we can.

[6:22] The town staff has been outstanding to work with all of them

[6:26] because we've had a lot of activity on the project,

[6:29] and I really want to thank all of them.

[6:32] I won't try to name everyone, but we've had a lot,

[6:35] and it's been going great.

[6:36] And with that, I'd be happy to answer any questions if you have any.

[6:40] Council, have any questions?

[6:41] Yes, Mr. Mayor.

[6:42] Yes.

[6:43] Do your cost estimates and planning not to bring the future forward too much,

[6:49] but do they account for the Sonoran Corridor,

[6:52] which will be going through about 89 up there?

[6:55] The cost estimates don't account for that.

[6:59] We don't even know what's happened on that,

[7:03] but it's certainly something we're paying a lot of attention to,

[7:07] and I've been involved in the Tier 1 study.

[7:09] Funding is being sought for the Tier 2 study now.

[7:14] Hopefully, I'm not sure the infrastructure bill will be able to fund that project,

[7:19] but progress is being made,

[7:21] and we'll just, with respect to the Rancho project,

[7:24] have to see what develops.

[7:26] It's still many, many, many years down the road.

[7:31] I sometimes wonder about that,

[7:33] given the amount of money that's being printed.

[7:36] The infrastructure could certainly come much more quickly,

[7:40] especially since this is getting support at a regional level to a fair degree.

[7:44] I'm not worried about A11.

[7:45] That's for the grandchildren of our grandchildren to worry about.

[7:49] But again, just so that you're in tune with it,

[7:52] because obviously it's going to have a big impact

[7:55] cutting through that property at some point with your sewers and other things.

[8:00] In Gil, I just had a meeting, a PAG RTA meeting,

[8:03] and we had a presentation on that particular project.

[8:07] They think it'll probably be in three phases,

[8:10] coming from the east to the west,

[8:12] from I-10 to the airport,

[8:14] airport down to Salvarita Road.

[8:17] I'm using the airport, I'm saying that's exactly it.

[8:19] And then the third phase would be what you're discussing,

[8:24] and the cost estimate today is a billion dollars to do it.

[8:29] Never mind, like you said, I-11, what that's going to cost,

[8:32] but just the Sonoran Corridor portion in total is about a billion dollars.

[8:37] I think it goes to your point on what's in there

[8:40] and how much can one project get.

[8:42] I think the airport's getting 300 million,

[8:44] and that's a huge win to get 300 million,

[8:48] but that's as far as we've been briefed.

[8:51] No, I just like to make sure that we're contemplating

[8:54] because that type of future obstruction going through a major development

[9:00] can be rather upsetting. That's all.

[9:03] And thank you.

[9:04] Mr. Mayor.

[9:05] Yes.

[9:06] Council Member Lusk.

[9:07] My firm is the lead lobbyists on getting money for that project,

[9:10] so I am intimately familiar with it.

[9:12] Did I state anything incorrectly?

[9:13] You did not.

[9:14] Okay, good.

[9:15] Now I'm confident that it will be in Phase 3 in no time at all.

[9:20] Mr. Mayor, everyone's question.

[9:21] Yes.

[9:22] I actually have it for staff.

[9:23] Whenever I'm voting to-

[9:26] I know we're not increasing anybody's taxes on this bond or whatever,

[9:29] but we are extending the time that they will be paying for it.

[9:32] What is the process-

[9:34] can you remind me again,

[9:35] it's allowing the residents to know that this is coming,

[9:37] that this vote is going to occur?

[9:39] Because I know this affects only a small portion of our residents currently.

[9:44] Mr. Chairman, members of the board,

[9:46] that action isn't what we're taking today.

[9:49] Right now we're just looking for the authorization to move forward

[9:51] with the feasibility report.

[9:53] So the way the process would work is get the authorization today,

[9:56] come back in January,

[9:58] actually take a look at the results of the feasibility report,

[10:01] which includes all the financing and what have you.

[10:03] And then after that,

[10:05] we had scheduled another meeting for a month later in February,

[10:08] and that would be the one that would be the public hearing

[10:10] and an opportunity for the public to come and give you feedback.

[10:13] Okay. Thank you.

[10:15] Any other questions?

[10:17] I'll entertain the motion.

[10:19] Council members, thank you very much.

[10:20] Mr. Mayor. Yes.

[10:21] I move to direct district staff to prepare a feasibility study

[10:24] for the insurance issuance of general obligation bonds

[10:27] to acquire public infrastructure.

[10:29] Second.

[10:30] Any further discussion?

[10:31] All those in favor, signify by aye.

[10:33] Aye.

[10:34] Any opposed?

[10:35] Aye.

[10:36] Moving forward.

[10:37] Thank you.

[10:39] Having no more further business for the CFD,

[10:42] we'll adjourn.

Rancho Sahuarita CFD Regular Meeting

Transcript