NOTICE AND AGENDA CITY OF NORTH LAS VEGAS SHARED SERVICES COMMITTEE MEETING. March 20, 2014 CALL TO ORDER

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1 NOTICE AND AGENDA CITY OF NORTH LAS VEGAS SHARED SERVICES COMMITTEE MEETING March 20, 2014 CALL TO ORDER 3:04 P.M., North Las Vegas City Hall, 2250 Las Vegas Boulevard North, 9 th Floor, Room 937, North Las Vegas, Nevada ROLL CALL MEMBERS PRESENT Chairman Glenn Christenson, Velstand Investments Vice Chairwoman Kristin McMillan, President/CEO, Las Vegas Metro Chamber of Commerce Hannah Brown, President, Las Vegas Urban Chamber of Commerce Rene Cantu, Executive Director, Latin Chamber of Commerce (via telephone) Lt. Colonel Barry Cornish, Commander, Nellis and Creech Air Force Base Michael Richards, President, College of Southern Nevada David Steinman, Citizen Representative from City of Las Vegas (via telephone) Terry Stimson, Citizen Representative from City of North Las Vegas Carole Vilardo, Nevada Taxpayers Association James Barrett, Jr., J.A. Barrett Co. MEMBERS EXCUSED STAFF PRESENT Thom Reilly, Managing Principal of The Reilly Group Jeff Buchanan, Interim City Manager, City of North Las Vegas Dr. Qiong Liu, Deputy City Manager / Public Works Director, City of North Las Vegas Betsy Fretwell, City Manager, City of Las Vegas Sandra Douglass Morgan, City Attorney, City of North Las Vegas Barbara A. Andolina, City Clerk Ryann Juden, Executive Governmental Affairs Liaison, City of North Las Vegas Ted Olivas, Chief of Staff, City of Las Vegas Mayor John J. Lee, City of North Las Vegas Mayor Pro Tempore Anita G. Wood, City of North Las Vegas Councilman Wade W. Wagner, City of North Las Vegas Councilman Steve Ross, City of Las Vegas Darren Adair, Acting Finance Director, City of North Las Vegas Terri Sheridan, Economic Development Administrator, City of North Las Vegas Greg Blackburn, Community Development and Compliance Director, City of North Las Vegas Mitch Fox, Communications Director, City of North Las Vegas Mark Vincent, Purchasing, City of Las Vegas Adelmira Tapia-Rojas, Deputy City Clerk

2 Page 2 March 20, 2014 WELCOME Thom Reilly, Managing Principal of The Reilly Group VERIFICATION Barbara A. Andolina City Clerk There was no public participation. PUBLIC FORUM NEW BUSINESS 1. APPROVAL OF SHARED SERVICES COMMITTEE MEETING MINUTES OF JANUARY 23, (FOR POSSIBLE ACTION) ACTION: MOTION: SECOND: AYES: NAYS: ABSTAIN: ABSENT: APPROVED Chairman Christenson Member Vilardo All (None) (None) Member Barrett 2. APPROVAL OF THE BUSINESS LICENSING RECOMMENDATIONS AND PRESENTATION GIVEN AT THE SHARED SERVICES COMMITTEE MEETING OF MARCH 6, (FOR POSSIBLE ACTION) Member Vilardo requested clarification of what needed approval. Mr. Thom Reilly explained the item was on the March 6, 2014 as a presentation and the committee needed to approve the recommendations. Darren Adair, Acting Finance Director, City of North Las Vegas, explained the Business License presentation was given to the North Las Vegas City Council at their meeting on March 5, 2014 and the City Council accepted the recommendations.

3 Page 3 March 20, 2014 Member Brown confirmed the recommendations were accepted as presented. City of Las Vegas City Manager Betsy Fretwell confirmed that no additional positions were created as part of the program presented to the North Las Vegas City Council. Chairman Christenson questioned whether the committee needed to take action since the North Las Vegas City Council accepted the recommendations. City of North Las Vegas Interim City Manager Jeff Buchanan said the North Las Vegas City Council was interested in the committee s opinion. Mr. Reilly explained the vote taken was a formal adoption by the Shared Services Committee of the presentation and recommendations. Member Vilardo said although the North Las Vegas City Council approved the presentation there were discussions at the last Shared Services Committee meeting regarding other matters to be completed. She questioned whether the committee should request that other recommendations be added. City of North Las Vegas Mayor John Lee explained the presentation indicated deficits in the area of Business Licensing. He said the North Las Vegas City Council approved the recommendation that banks were required to have business licenses. It was also stated that other matters would be coming forward and Business Impact Statements were being prepared. Member Vilardo said it was the first time the committee had a recommendation that was moving forward. Chairman Christenson said there were revenue opportunities in the approximate amount of $1.8 million and costs associated with the ability to create the revenue generation. What the committee would be recommending was that the City of North Las Vegas proceed with the recommendations. North Las Vegas Mayor Lee said the City s ordinances would need to be brought in compliance prior to moving forward with specific recommendations. Member Brown questioned the timeframe needed to bring the codes up to date. Vice Chairwoman Kristin McMillan arrived at 3:11 p.m. North Las Vegas Mayor Lee said once the recommended changes were identified, a Business Impact Statement would be prepared and the process would take approximately one month. City of North Las Vegas Deputy City Manager Dr. Qiong Liu explained there was a Business License Manager position included in the proposed City budget. Chairman Christenson stated the presentation was given and recommendations were agreed on by the Shared Services Committee.

4 Page 4 March 20, 2014 City of North Las Vegas City Attorney Sandra Douglass Morgan said the changes could be implemented at the end of April. Member Steinman said the committee was called the Shared Services Committee. He explained the City of Las Vegas provided their expertise to the City of North Las Vegas regarding licensing. The City of North Las Vegas said they could do what was suggested without any assistance. Member Steinman was led to believe the City of North Las Vegas had more people involved in licensing even though the individuals were not all full-time and did not have an abundance of experience in the area. He said the time and effort provided by the City of Las Vegas was lost and there was no potential for the City of Las Vegas to receive any benefits. Member Steinman questioned whether the North Las Vegas City Council required their staff to report back to them to ensure the goal of $1.8 million in revenue was achieved. He was concerned that the guidelines of the Shared Services Committee were not being followed. Mark Vincent, Purchasing, City of Las Vegas arrived at 3:12 p.m. North Las Vegas Mayor Lee explained the City of North Las Vegas had 12 items that could be possibly done. He said there was no indication that the City of North Las Vegas would do business on all of them but they were items that needed to be worked on and reviewed. When both cities performed an analysis there were differences in fees. He explained licensing was an area that the City of North Las Vegas was given insight on hot to enhance its performance. City of Las Vegas City Manager Fretwell said there were items that could be beneficial by working together rather than separately but the items were not yet determined. She said the City of North Las Vegas could choose to lay-off four people and work with the City of Las Vegas but decided to spend $200,000 for the ability to generate $1.8 million instead of doing a partnership with the City of Las Vegas. City of Las Vegas City Manager Fretwell was pleased that the City of North Las Vegas found methods to utilize in their own City. She hoped there would be partnerships formed between the Cities which could lead to hard decisions but be beneficial in the long-term. City of Las Vegas City Manager Fretwell said the City of Las Vegas was larger and it would be easier to perform the services for the City of North Las Vegas. Chairman Christenson understood there were challenges taking the business licensing processes of the City of North Las Vegas and applying the process into the system utilized by the City of Las Vegas. He said there would be capital expenses related to the integration. City of Las Vegas City Manager Fretwell said during preliminary conversations prior to the establishment of the Shared Services Committee, it was discovered some of the areas were at different levels. She explained the City of North Las Vegas was spending $200,000 to improve their business licensing process. The $200,000 could have been given to the City of Las Vegas towards the technology

5 Page 5 March 20, 2014 upgrade needed to allow the City of Las Vegas to perform the business licensing of the City of North Las Vegas. City of Las Vegas City Manager Fretwell said a policy decision would be needed by the North Las Vegas Mayor and City Council to adopt the City of Las Vegas licensing system. She said there were areas where each City could benefit from the fee structures established. Mr. Reilly said the agreement between the Cities of North Las Vegas and Las Vegas was also a Management Consulting Agreement. He agreed with Member Steinmann that there were no sharing of services but the City of North Las Vegas received valuable information from the City of Las Vegas regarding methods to improve the area of business licensing. North Las Vegas Mayor Lee said once the City of North Las Vegas made a decision on the direction to be taken, a review began. He said the Shared Services Committee provided a platform which could be presented to the City of North Las Vegas. Member Brown said the ultimate goal was to increase revenue to reduce the deficit. She heard the phrase cutting employees and said the City of North Las Vegas could not cut their way out of a deficit. North Las Vegas Mayor Lee said the City of North Las Vegas was cross-training individuals to do similar tasks. City of North Las Vegas Deputy City Manager Liu clarified the Mayor s statement and explained the City of North Las Vegas desired to improve processes and efficiencies through resource sharing. The Fire Department was being trained in the inspection portion of the process. Member Brown said there were discussions at the last meeting regarding union concessions and questioned the status. North Las Vegas Deputy City Manager Liu said she could not discuss the concessions but discussed what was being implemented. She explained the City of Las Vegas was not willing to change their codes regarding business licensing. The City of North Las Vegas would need to adopt the City of Las Vegas codes. This issue was not whether there were opportunities, but rather what the best outcome was with minimal investment. Vice Chairwoman McMillan said there were two jurisdictions involved but did not want to lose sight of the customers who were looking for a streamlined process. Member Steinman said he hoped North Las Vegas Mayor Lee had confidence in the licensing staff to generate $1.8 million in revenue. He was concerned that the goal would not be achieved.

6 Page 6 March 20, 2014 Chairman Christenson said someone needed to be accountable that the $1.8 million would be achieved. He was concerned that the goal of working together would not be reached. ACTION: MOTION: SECOND: AYES: NAYS: ABSTAIN: ABSENT: APPROVED Member Brown Member Cantu All Member Steinman (None) Member Barrett 3. PRESENTATION AND/OR DISCUSSION REGARDING A SHARED SERVICE ARRANGEMENT IN THE AREA OF REDEVELOPMENT AND ECONOMIC DEVELOPMENT. (FOR POSSIBLE ACTION) Bill Arent, Director of Economic and Urban Development, City of Las Vegas, spoke about Shared Opportunity and said the City of Las Vegas and City of North Las Vegas were at different levels of service. He discussed the following highlights: City of Las Vegas has experienced team of 19.5 staff in Economic Development and Redevelopment City of North Las Vegas currently has four staff for these services City of Las Vegas staff is available to assist City of North Las Vegas for a negotiated fee City of Las Vegas staff assistance could include: o Strategic planning o Developer, Investor and Business recruiting o Project negotiation and deal structuring Director Arent said the City of Las Vegas had a sufficient number of staff based on the size of the city. The City of North Las Vegas was understaffed by five staff members for the same services. He explained the City of Las Vegas was available for assistance by providing expertise in areas such as strategic planning and recruiting of new businesses to the city. Director Arent discussed the rationale for Why Shared Services? Long-term revenue enhancement opportunity for both Improved or stabilized service levels for the City of North Las Vegas Innovative governance modeling / strategic opportunity Partnership to improve the region

7 Page 7 March 20, 2014 Director Arent reviewed the Anticipated Obstacles which related to the City of North Las Vegas: Anticipated Obstacles Economic Development Redevelopment High industrial vacancy impedes new development Additional infrastructure needed to support development of existing industrial sites (i.e. Apex) Large time lag from project inception to realization of new property tax revenues Existing tax increment base ($1.2 million in revenue) is declining year-over-year (but fund balance is healthy) Large time lag from project inception to realization of new property tax revenues Director Arent reviewed the following information related to both cities: Anticipated Cost Savings: City of Las Vegas will not realize any cost savings; potential upside of tax revenue share. North Las Vegas: o Shared Services utilizing current staff levels or adding staff will not realize any cost savings o Engaging the City of Las Vegas for shared services could result in savings due to eliminating admin, overhead costs Potential exists for North Las Vegas revenue enhancement to general fund through new business licenses, C-tax revenue, property tax revenue and permitting fees. Director Arent reviewed the Proposed Partnership Agreement: Agreement term would be five-years with one, five-year extension o Agreement would be reviewed at the end of years one and three and would require the mutual consent of both parties to terminate o Agreement extension beyond the initial five-year term would require mutual consent of both parties

8 Page 8 March 20, 2014 Payment of the performance incentive payment would survive any termination of the agreement Cities of North Las Vegas and Las Vegas to determine budgets based on remaining agreement term Cities of North Las Vegas and Las Vegas to agree on work priorities semiannually Member Cantu was concerned about safeguards in a Shared Services Agreement against Economic Development / Redevelopment in which the natural tendency was to give preference to one City over another for more appealing businesses. Director Arent said the best way to avoid the issue was to rely on a Code of Conduct. In the profession it was widely understood and often in writing that you do not poach deals from other communities. He said there were structural benefits from the way the tax structures were set up. A Code of Conduct and a Code of Ethics would be established in which the professionals working with the deals would represent the community. Director Arent said the partnership would work because the City of Las Vegas had 7% of the Valley s industrial base. He explained the communities were different with different assets. Director Arent spoke about Compensation Terms Proposed: Annual base payment: $150,000 for staff, could scale; alternatively, City of Las Vegas would consider flat fee of $300,000 Consulting expenses: not-to-exceed $100,000 annually Performance incentive payment: o 25% of new property tax revenue collected for large Economic Development projects (20+ hours of City of Las Vegas engagement) Started discussions at 50% o 25% of new property tax revenue collected for large Redevelopment projects (20+ hours of City of Las Vegas engagement) Started discussions at 50% o Revenue Share distributed per project for a 10-year period Director Arent said the cost was $150,000 per full-time staff equivalent engaged on a project. The intent was not to limit the City of Las Vegas engagement but rather have the City of Las Vegas absorb its upfront costs and not have a loss for work done in the City of North Las Vegas. The thought was to flex up or down depending on work volume. He said for budgeting purposes, the Cities would agree upon a minimum payment of $150,000 or $300,000 for larger projects. Director Arent explained there was often third-party expenses associated with large projects. It was agreed upon to have a not-to-exceed amount of $100,000 annually for out-of-pocket expenses.

9 Page 9 March 20, 2014 Director Arent discussed the performance incentive payment and said the original discussions with the City of North Las Vegas had a revenue split of 50/50; 50% to the City of Las Vegas and 50% to the City of North Las Vegas. Over time the revenue split was changed to 25%; 25% of new property tax revenue would go to the City of Las Vegas for projects the City of Las Vegas was directly engaged in; the remaining 75% would go to the City of North Las Vegas. Director Arent explained a few options were considered for Redevelopment. The options were very complicated and the decision was to make Redevelopment the same as Economic Development. Instead of 25% off the whole tax district, the revenue share would be distributed per project. The threshold was based on projects in which the City of Las Vegas had 20+ hours of engagement. Member Vilardo said there were instances where a Redevelopment project was also an Economic Development project. She questioned whether there would be one charge. Director Arent said a Redevelopment project was one that was inside the City of North Las Vegas Redevelopment area. He explained the project could be a new business or a demolition and rebuild. Member Vilardo questioned 25% on 20 hours and asked if the revenue could be scaled. City of Las Vegas City Manager Fretwell confirmed the question was if the threshold could be based on the value of the project rather than the number of hours. She explained the project value needed to exceed $2 million. Director Arent said the issue could be reviewed. He was speaking about the day-to-day projects that required an hour at a time. Member Vilardo said she would be more comfortable with something more flexible. She was concerned about payments prior to the project getting approved. Director Arent said the incentive payment would not be paid until there was revenue generated by the City of North Las Vegas. City of Las Vegas City Manager Fretwell explained an example of the 25%: 20+ hours and a minimum threshold value Complete the work Project in place New business would begin putting approximately $5 million on the tax rolls The City of Las Vegas would receive 25% of the $5 million for that year and the next ten. Member Vilardo asked if the issue of a business moving into an existing building was addressed. Director Arent said the issue was addressed which was the reason for the upfront money.

10 Page 10 March 20, 2014 Vice Chairwoman McMillan said she knew each project had a different amount of time spent and asked if time studies were performed to show the average hours spent for a large economic development project. Director Arent said a time study had not been performed but was in excess of the 20 hours. The time included the initial work of talking with the company that was often out of the market; getting them to visit the community; meeting with local employers to understand the business climate; and meeting with workforce agencies (staffing agencies) to understand labor issues and costs. He estimated it took approximately 40 to 60 hours. Member Stimson questioned the benefits of paying the City of Las Vegas for the needed staff positions or hiring new employees in the City of North Las Vegas. Director Arent said the issue was discussed and the City of Las Vegas was at a staffing level in which additional work could be handled. Project engagement needed to be reviewed annually to determine staffing needs. Director Arent discussed property taxes for new projects. Example, a new commercial project would come into North Las Vegas, not in the redevelopment area, with a construction valuation of approximately $10 million. The way the property values were appraised in the State of Nevada the value would be decreased by as much as 50% to $5 million. The assessed value would be 35% of the $5 million which was $1.7 million. The property tax paid, based on the tax rate would be $59,000 and distributed over several jurisdictions. The City of North Las Vegas would receive one-third of the property tax or approximately $20,000. The 25% revenue share to the City of Las Vegas would be $5,000. Member Vilardo questioned the definition of a large project. Director Arent said in the City of Las Vegas a project in excess of $20 million would be considered a large project such as Symphony Park. Chairman Christianson asked what would make the North Las Vegas City Council comfortable that attention was being given to the City. Director Arent said he would look at the Business Plan. The Cities of Las Vegas and North Las Vegas would agree on the scope of work which was more like a Business Plan. He said a conversation would be needed with the Las Vegas Mayor and City Council along with the City Manager to review how to balance the priority of service sharing in Economic Development with the City of North Las Vegas. City of Las Vegas City Manager Fretwell said enough people were needed to cover the territory. She said staff was added in anticipation for the Shared Services Agreement. She was a firm believer that work expanded based on the number of people around. If there was an agreement there would be resources available to have the staff if needed. The process would need to be done collaboratively based on the business plan.

11 Page 11 March 20, 2014 City of Las Vegas City Manager Fretwell said managing the Business Plan and understanding expectations would provide insight on what each team needed to do and simultaneously figure out where there were gaps. She said everyone was in a deficit position and struggling to keep up with the demands. City of Las Vegas City Manager Fretwell said the City of North Las Vegas Economic Development staff was too small to perform. The City of North Las Vegas had an $18 million deficit. A decision was made by the City of North Las Vegas to hire two employees for the Business License division. She questioned whether the City of North Las Vegas would rather hire four or five additional staff members for Economic Development that would not pay for itself for four or five more years or take advantage of the City of Las Vegas expertise and benefit from a property tax and sales tax split. Chairman Christenson asked if he had a business and was interested in the City of North Las Vegas, who would he call, the City of North Las Vegas or City of Las Vegas. He questioned whether there would be an office in the City of North Las Vegas. Director Arent said for the system to work there needed to be a staff person within the City of North Las Vegas. The staff would have access to a larger team in the City of Las Vegas for assistance. Director Arent reviewed the following: City of Las Vegas responsibilities: Provide staff for strategic planning, marketing, deal structuring, contract administration, coordination with federal, state and local agencies and general administration. Staffing level to be adjusted on an as-needed basis Preparation of an investment strategy, within first four months Preparation of quarterly and annual reports that addresses agreed upon performance criteria City of North Las Vegas responsibilities: Compensate City of Las Vegas annually for staff time at a rate of $150,000 per FTE Fund up to $100,000 annually for third party consulting fees (such as travel, marketing, design and engineering) Pay a performance-based incentive on projects realized Project approval is at the discretion of Redevelopment Agency Board / City Council

12 Page 12 March 20, 2014 Joint responsibilities: Abide by a set of operating covenants which cover workflow, marketing, site selection and how both parties will handle prospect sharing between each other and the region Both parties shall follow an Employment Plan Policy for projects supported by both cities Director Arent explained the investment strategy would guide the annual and recurring scope of work. The desire was for the City of North Las Vegas to utilize the regional opportunities. He explained there was an employment plan policy which was required by law for redevelopment projects and was expanded for economic development projects as a City policy. Member Vilardo questioned if the City of Las Vegas was facilitating a project in the City of North Las Vegas would the project be under the City of Las Vegas plan for redevelopment and economic development. Director Arent said the City of North Las Vegas was asked to follow the same policy. Member Vilardo confirmed that any agreement between the cities would be brought before both City Councils. She questioned the plan of action if both City Councils did not agree on the termination or renewal of the Interlocal Agreement. City of Las Vegas City Manager Fretwell said North Las Vegas Mayor Lee was concerned about what would be done if the agreement did not work. She explained the agreement would be reviewed after year one and year three which would protect each city from the other one picking up and walking away. North Las Vegas Mayor Lee said the agreement would be written with all concerns addressed. Member Richards said the potential caseload change for the City of Las Vegas was the leading barrier for the success of the Shared Services Agreement. He questioned whether there were discussions regarding possible obstacles in moving forward with the proposal. Director Arent said staffing was a complex issue. The City of Las Vegas had numerous large projects which required significant staff involvement. The scope of work would need to be reviewed. Another issue was to avoid the perception that a business was being led towards one city over the other. He said it was important to provide transparency and avoid any misconceptions.

13 Page 13 March 20, 2014 Darren Adair, Acting Finance Director, City of North Las Vegas, reviewed the City of North Las Vegas Redevelopment and Economic Development areas. He discussed the following: Opportunity / Questions: How can the City of North Las Vegas leverage the City of Las Vegas Economic Development team or resources to support new projects What resources are available currently to the City of North Las Vegas to assist with: lead generation/identification, strategic planning, developer and investor recruiting, project negotiation and deal structuring When does the City of North Las Vegas need the additional assistance and what is budgeted for investment What options are available to the City of North Las Vegas Acting Director Adair said the assistance was needed immediately for the City of North Las Vegas. The City of North Las Vegas was currently in the budget process and had taken the proposed amounts for payment to the City of Las Vegas and incorporated them into the budget. He explained the City of North Las Vegas needed to make an investment in the proposal. The following items were discussed: Rationale Why Shared Services? Revenue enhancement opportunity long term Improve and stabilize service levels Innovative governance modeling/strategic opportunity Partnership to improve the region Shared Service Options Discussed The City of North Las Vegas with the City of Las Vegas had been considered: Revenue Share model Fee for Service model Project Focused model Tiered Commission model

14 Page 14 March 20, 2014 Revenue Share Model: Currently proposed by City of Las Vegas 25-50% of net increase revenues 10 year recurring $150,000 per FTE, time tracked $100,000 out-of-pocket reimbursement Fee for Service Model: Initially proposed by City of Las Vegas and 1 st Workshop Reimbursement of cost at 1.96 X (actual cost of individual) Profit participation at 3.92 X (the cost) Time tracked Project Focused Model: Initially recommended by the City of Las Vegas at the 2 nd Workshop Parcel or area focus TBD% Industry or sector focus TBD% Tiered Commission Model: Mutually discussed at joint meeting Commission based on deal size Example of tiering: > $50m and < $75m 25%* > $75m and < $100m 20%* > $100 m and < $200m 15%* > $200m and < $400m 10%* > $400 m TBD *Percentage rates are reasonable illustrations only Acting Director Adair reviewed the Shared Services options for the City of North Las Vegas which included: Develop North Las Vegas Team o Evaluate existing team strengths o Add one to four FTE s in focus areas o Establish budget for marketing o Develop relationship in areas of focus o Actual FTE and overhead costs (no commission)

15 Page 15 March 20, 2014 Contract with 3 rd Party o Access resources of local / national significance, IEDC (International Economic Development Council) o Engage project / industry specific lobbyists as needed o Engage local / state / regional talent o Engagement negotiated costs (could include commission, reimbursement, etc.) Contract with City of Las Vegas (consulting / temp staffing) o Access City of Las Vegas resources as available o Strengthen regional vision / cooperation o Mutually beneficial o Actual FTE costs + overhead + long-term commission Combination of one or more of the above o Use Governor s Office of Economic Development (GOED), Las Vegas Global Economic Alliance (LVGEA), 3 rd party for lead identification o Infill projects, existing retrofits and projects generally less than $50m, handle in-house o Pay City of Las Vegas retainer of $150,000/year for first 2,000 hours o Utilize Procuring Cause base incentive model with variety of City of Las Vegas and/or 3 rd party o Projects > $50m partner with City of Las Vegas Acting Director Adair reviewed the concerns raised by both cities: Additional Concerns Raised City of Las Vegas: Commission consideration for appreciation in neighboring Redevelopment Areas Commission on projects in Redevelopment Areas which are tax free or have abatement incentives Desire to see cash flow sooner than later from revenue participation Additional Concerns Raised City of North Las Vegas: Define performance criteria and time line Model for eventual development of City of North Las Vegas Business Development / Redevelopment function and support Consideration in commission for covering FTE and Overhead costs Reasonable floor to recognize current achievable value / tax revenue increases Reasonable cap on unforeseen changes in taxing rates Procuring cause commission structure

16 Page 16 March 20, 2014 Example of Procuring Cause Structure: Lead generation + 2% Introductory meetings with City Of North Las Vegas + 2% Defined deal commitment + 4% Deal closure, permits, C of O + 2% Follow-up, City of North Las Vegas hand-off (1 year) +2% Total 13% Acting Director Adair said currently in the Valley there were signs of growth in the economic development and redevelopment areas and the values in the areas started to increase. The concern was how the agreement addressed existing momentums the team had in place. Chairman Christenson questioned the status of the partnership between the cities since there had been numerous presentations. He asked if the cities were close to making a deal. Acting Director Adair said the deal presented by the City of Las Vegas was the same as it had been. Chairman Christenson said nothing would be accomplished if the Cities did not get together and develop structure and framework. Member Brown said a decision was needed. Chairman Christenson said the committee s decision would not matter since the Las Vegas and North Las Vegas City Councils had to be in agreement. North Las Vegas Mayor Lee said size of the City was not significant but the issues were the size of the projects and commission. He said smaller projects, higher commission and larger projects, smaller commission. City of Las Vegas City Manager Fretwell said it was the first time she had seen the 13% Procuring Cause Structure. She said the City of Las Vegas attempted to develop something simple and generalized enough that could utilize the City of Las Vegas resources effectively for the City of North Las Vegas in a way that worked. She said a threshold may be needed on projects. She was hesitant to try and create a sliding scale. City of Las Vegas City Manager Fretwell said the Procuring Cause Structure was overly complicated and would be difficult to track. She said the proposal created by the City of Las Vegas was reasonable and ready to be implemented. The proposal did not require the City of North Las Vegas to add a staff person; included a base payment of $150,000 over a five-year term with a re-evaluation every two years. She was not opposed to creating a low and high threshold on projects to determine when the City of Las Vegas would step in. North Las Vegas Mayor Lee said staff had been meeting to discuss the proposal and this was the first time he had actually seen the presentation. He felt a proposal could be worked out if the parties involved sat down and had a discussion.

17 Page 17 March 20, 2014 Chairman Christenson did not know what to do with the information received. He said the committee was not going to make the judgment call since there was no responsibility to do so. North Las Vegas Mayor Lee said the committee could offer their expertise. Chairman Christenson said the committee wanted to be helpful but it was not being made easy for them. North Las Vegas Mayor Lee said it was not the committee s job to make the decision but their job was to listen and offer suggestions. Member Richards said the cities should consider formalizing the one, three and five year models; select the model that was felt to be the best; have each City Council endorse the model; and move forward using the testing period to see if the model worked. Member Brown said the City of North Las Vegas needed a level of comfort and knowledge of what the benefits would be. City of North Las Vegas City Attorney Sandra Douglass Morgan questioned whether there was interest or a willingness to decrease the 25% from the proposed model developed by the City of Las Vegas. City of Las Vegas City Manager Fretwell understood the edge of caution being taken by the City of North Las Vegas and the decreased percentage but she needed to make the proposal beneficial to the staff in the City of Las Vegas. She was not opposed to the placement of a project threshold in the proposal. Mr. Reilly said there were many items on the plate. There was a challenge distributing information since everyone was busy. He recommended utilizing the next meeting for Staff to finalize a deal. He said there was feedback provided by the committee and hard decisions were needed. City of Las Vegas City Manager Fretwell recommended drafting the Interlocal Agreement to bring to the Committee so the actual proposal would be better understood. Mr. Reilly said there should be a meeting with the staff to draft the agreement. Time was available to bring the information back to the committee for consideration. 4. PRESENTATION AND/OR DISCUSSION ON THE PROJECTED BUDGET DEFICIT FOR THE CITY OF NORTH LAS VEGAS FOR FY 2014/2015 AND THE TIME FRAMES REQUIRED TO SUBMIT A BALANCED BUDGET TO THE STATE OF NEVADA, DEPARTMENT OF TAXATION. ACTION: STRICKEN

18 Page 18 March 20, REVIEW BY THOM REILLY ON PRESENTATIONS GIVEN. Mr. Reilly explained there would be time set aside on April 3, 2014 to allow staff to work out a plan between the cities and bring before the committee at the second meeting in April. There was no public participation. PUBLIC FORUM ADJOURNMENT ACTION: MOTION: SECOND: AYES: NAYS: ABSTAIN: ABSENT: THE MEETING ADJOURNED AT 5:05 P.M. Member Brown Member Vilardo All (None) (None) Member Barrett APPROVED: April 17, 2014 /s/glenn Christenson Chairman Glenn Christenson ATTEST: /s/barbara A. Andolina Barbara A. Andolina, City Clerk