Good afternoon and welcome to our sixth - and my final - State of the City Address. I'm Mayor Doug Hutchinson.

I'm very pleased to be standing here today with City Manager Darin Atteberry, delivering this address, live, and taking your questions.

Before we begin, I'd like to recognize my fellow Council members: Mayor Pro-tem Kelly Ohlson and Council members Lisa Poppaw and Wade Troxell as well as Ben Manvel and Aislinn Kottwitz who could not be here this afternoon. I'd like to specifically recognize Council member David Roy who is finishing his final term and has had the rare distinction to serve on Council for more than eight and a half years. Please join me in expressing appreciation for their service.

Good afternoon. I, too, would like to say welcome and thank you for being here for what has become an annual tradition. This year, as we share our thoughts on the state of the city, especially our community's future, I am extremely optimistic. I'm proud of what we've accomplished and I'm even more excited about the opportunities ahead.

After I graduated from Colorado State University and entered the United States Airforce, I spent 33 years running around the world. All that travel convinced me of one thing: hands down, Fort Collins is the best place to live. My time as Mayor has only made me further appreciate that Fort Collins is a very special place.

It's true; this community routinely receives national recognition. For example, just last year . . .

• Fort Collins was recognized as one of the Top 10 best American cities for real estate investments
• Money Magazine declared Fort Collins one of the Best Places to Live in the Nation
• Forbes.com ranked us 4th on their list of Best Places for Business and Careers
• And CNNMoney.com placed Fort Collins in the Top 25 Best Places to Retire.

Other statistics say just as much -- if not more -- about who we are. Nearly 41% of Fort Collins residents volunteer in the community, ranking us 4th on the nation-wide list of mid-sized cities. This is what makes Fort Collins special. It's the people who live here and who engage whole-heartedly in making Fort Collins one of the nation's best places to live, work, and play.

As a result, Fort Collins has proven amazingly resilient. Our unemployment rate hovers around 8.1%, below the nation and below the state of Colorado. Compared to other places across the country, our homes have held their value in this volatile market. And while construction and investment activity in other Colorado communities have nearly stopped, Fort Collins has major projects underway - - projects that will infuse more than $240 million into our economy in the near future. These include:

• $27.5 million to reconstruct the I-25/392 Interchange
• $82 million to build the Mason Corridor
• $34 million to transform our Utility with Smart Grid technology
• $11 million to kick start FortZED, Fort Collins' Zero Energy District
• $63 million to revitalize North College
• $24 million to build a new Discovery Museum

The vast majority of this funding comes from state and federal grants. These grants and projects are possible only because of the strategic leveraging of City dollars and private investment.

No partnership is more essential than the one we have with you, our community. It's the very foundation of local government. Citizens can directly influence services, policy decisions and the future of our community.

In November, Fort Collins voters made a strong statement about our future. You said "yes" to Issue 2B . . . adding $18.7 million annually to fund street maintenance, police, fire, parks and recreation, and other services critical to our quality of life. This was an amazing statement from you and we realize the responsibility that comes with it. I promise that we will continue to provide cost-effective services. We will maintain our commitment to transparency and open government. Per the ballot language, we will annually report how every dollar of your 2B money is spent - this high level of accountability is important to Council, and it's important to me.

The decision to place 2B on the ballot was years in the making. Between 2005 and 2010 we cut and deferred nearly $25 million in expenses and eliminated more than 150 City jobs.

During that same time period, we clearly defined the City's long-term needs for basic infrastructure and services and our options to address them. In the 2009 State of the City Address, we recognized the great economic uncertainty of the time and we gave our word that we would not be asking the voters to consider a sales tax increase that year. We kept our promise.

But the needs did not go away. In fact, they were magnified as we prepared the 2011-2012 Budget. Not only were we still deferring long-term needs, we were forced to confront an additional $5 million budget shortfall. We had no choice but to make significant cuts - cuts to services that have a direct impact on you.

So as we considered options, we turned to you for guidance. Eight community meetings, dozens of presentations and Q&A sessions, hundreds of conversations, emails, and phone calls - and one overwhelming theme emerged - you told us, "put it on the ballot and let us decide."

Council did, and you said yes.

$18.7 million will do a lot to keep this community great now and well into the future. A full 50% of the 2B money goes directly to transportation. After years of deferring basic street maintenance we will repair our roads, fix bridges, and reinvest in our critical infrastructure. We are preserving the existing level of transit service, including Dial-A-Ride night service, and continuing efforts to make Fort Collins bike-friendly.

Nearly 30% of the 2B money will be spent on public safety, one of the most fundamental responsibilities of local government. With an emphasis on downtown and neighborhood safety, we are now hiring additional patrol officers and detectives. Poudre Fire Authority is adding staff to serve the growing needs in south Fort Collins and to assure prompt emergency response across the community.

With 2B dollars, we'll maintain parks to the standard you've become accustomed to. And the recreation activities and facilities that are so important to our quality of life, such as Mulberry Pool and youth and senior programs, will remain intact.

2B money also addresses other community priorities. We'll invest in the future of our local economy, our environment, and our neighborhoods. For example, we'll augment support for our economic clusters, increase efforts to boost recycling, and invest in downtown.

Even though our local economy is doing relatively well, we cannot lose sight of the fact that there are people in our community who need assistance. We'll dedicate an additional $300,000 from the 2B revenue to support affordable housing and human service programs.

We recognize that some voters, probably some in this room, did not support this tax increase. Still, our commitment to each and every taxpayer, is to be good stewards, to spend your tax dollars wisely. Not just 2B dollars, but all City revenues.

Fiscal responsibility begins with a strong economy. When I became Mayor, one of my primary goals was to change the City's role in economic health from passive observer to active catalyst. At a Council retreat in 2006, a richly politically diverse Council unanimously agreed upon our first-ever economic vision - that is - a healthy economy that reflects the values of our unique community in a changing world. Guided by that vision, we've actively created an environment where businesses can succeed, in a way that fits Fort Collins.

Drive up North College and you can physically see the results of proactive economic policy and effective public-private partnerships. In recent years, we've primed the area for revitalization with major infrastructure improvements. This year we'll continue that progress with road improvements from Vine to Conifer. Our investment has been a catalyst for private investment. Projects such as the North College Marketplace, Kaufman Robinson, and the JAX expansion and are creating new retail, office and manufacturing space.

As home to the new Rocky Mountain Innosphere facility, North College is also emerging as the hub of business incubation. In the next five years, Innosphere, formerly known as RMI-squared, expects to assist more than 40 new startup companies, raise more than $120 million in capital, and create more than 400 new primary jobs.

We are capitalizing on the research, innovation, and talent of our community. Spurred by the hydrology expertise of CSU and other Fort Collins organizations, in 2010 we launched the Colorado Water Innovation Cluster. Local businesses and agencies joining this cluster are creating solutions to the global challenges of water safety, conservation, and management.

The City continues to advance other industry clusters: clean energy, bioscience, software, hardware, and uniquely Fort Collins with the goal of creating primary jobs.

Retail also plays an important role in our economic strategy. Last year we made real progress. We completed a comprehensive redevelopment study of Midtown, the area surrounding College Avenue from Prospect to Harmony, including Foothills Mall. Now we're implementing the recommendations. We're working closely with mall owners General Growth Properties - or GGP - to define specific redevelopment plans and timelines. With changes to the mall site currently underway, GGP is demonstrating that they are serious about renovation. We hope to have firm details by this summer.

The Mason Corridor is also spurring investment in Midtown. Through smart urban planning, economic development and modern transit, the Mason Corridor will fundamentally change how the spine of our City looks and functions. It is the first tangible result of our transit-oriented design policy. Design of the MAX bus rapid transit system is nearly complete. Construction of a new south transit center will begin this fall, and by late 2013, MAX service will be up and running.

With 70,000 vehicles passing through each day, Harmony & College is the City's busiest intersection. Last year, we reconstructed the intersection to relieve congestion, improve safety and make it more user-friendly for pedestrians and cyclists. We also enhanced landscaping, lighting, and design to make this intersection an attractive and welcoming southern gateway.

Partnerships are vital to success, yet they are not always easy, particularly as the region matures and each community develops its own set of values and priorities. It's important that we focus on our commonalities, while acknowledging our differences. By working together, we provide cost-effective solutions to regional challenges.

Through an expanded partnership with neighboring communities, we now offer an extended transit route for the region. The grant-funded FLEX bus service connects Fort Collins, Loveland, Berthoud and Longmont, and, for the first time ever, it links into the Denver RTD system.

The interchange at I-25 and State Highway 392 is a remarkable example of regional cooperation. The City of Fort Collins and the Town of Windsor have partnered to fix this failed interchange, which is a major gateway to both communities. Along with enhancing safety and easing congestion, improvements will also protect viewsheds, enable economic activity, conserve surrounding wetlands and balance the built and natural environment. In recognition of this unique partnership, the Colorado Department of Transportation awarded the project $22.5 million in state and federal funds last year.

With the Climate Action Plan, our community has set aggressive, yet attainable climate goals - reduce community-wide emissions 20% below 2005 levels by 2020.

Progress starts with individual action. Last year, you brought more than 20,000 pounds of dangerous materials to the City's Household Hazardous Waste event for proper disposal. You signed up for home energy audits, recycled refrigerators, and purchased a combined total of almost 3,300 energy and water efficient appliances through Fort Collins Conserves programs.

We're making it easier for you to minimize your environmental impact with the recent launch of fcgov.com/green, a single online location for all City environmental programs, policies, and plans.

With funds from 2B, we'll provide additional opportunities for Fort Collins residents to make a difference. You'll see solar recycling bins and composting units Downtown. Through the power of volunteers, we'll launch a new program to offer voluntary in-home sustainability assessments and recommendations.

Achieving the goals in our Climate Action Plan will take a mix of individual actions and policy changes. In March Council will consider a new Green Building Program that uses both regulations and incentives to encourage environmentally friendly building practices.

Consistent with the expectations of City Council and our community, we are placing a higher priority on sustainability. Our staff, including John Stokes and others in Natural Resources, Utilities and Operation Services, have done an excellent job in this area. And, we want to do more.

I'm pleased to announce that, this Thursday, successful entrepreneur and respected local business owner, Bruce Hendee, is joining our City team. Bruce has a pragmatic and business-minded approach to sustainability and he brings a unique set of skills related to the built environment. He's innovative, he's a true collaborator, and he will be a valuable member of my executive team. Bruce, welcome.

Fort Collins is quickly becoming the epicenter of renewable energy in Colorado. Earlier this month, Colorado State University President Dr. Tony Frank announced that former Governor Bill Ritter will head CSU's Center for the New Energy Economy. This new national policy center will build essential partnerships to advance clean energy solutions.

Through the forward-thinking FortZED initiative, we are transforming two square miles of our community into a net zero energy district - - a place where we use less energy and produce and manage our energy more efficiently. More than 400 residents have already joined in the Community Energy Challenge, coordinated by UniverCity Connections and the Atmosphere Conservancy.

We are using plug-in cars, solar panels and traditional generators to test how our existing electric grid accepts and distributes energy. Some of these initial resources, such as the diesel generators, are temporary substitutes for renewable resources not yet in place. Findings from this FortZED jumpstart project will help us create the Utilities of the 21st Century and will significantly impact the future of renewable energy in Fort Collins, the state, and even the nation. In fact, this project is one of only nine smart grid demonstrations in the country to receive funding from the US Department of Energy.

Our community truly is a place where innovation thrives. Take for example, the Fort Collins Museum and Discovery Science Center, a cutting-edge approach to blending history and science. The public-private partnership behind the museum is among the first of its kind in the nation. The building itself embodies innovation. It will have an amazing digital dome theater and exhibits that represent community interests, including water, local history, music, and energy.

Innovation is not always about big projects, it's about creative solutions. The Downtown Development Authority - or DDA -- is turning ordinary alleys into works of art and creating unique community gathering places. With leadership from their board of directors and Executive Director Matt Robenalt, the DDA is building on their long history as an engine for economic and cultural growth in our central business district.

To further solidify downtown as the heart of our arts and cultural community, we're giving the Lincoln Center a fresh new look. In 2005, voters approved funding to make major upgrades to the facility, positioning the Lincoln Center as THE cultural venue in the region for years to come.

The community we have today did not happen by accident. It is the result of bold visions and careful planning. Now we're looking to the next 30 years with the Plan Fort Collins community-visioning effort. Through extensive public input and consideration, we've updated City Plan and the Transportation Master Plan to be more reflective of current community priorities, including innovation, sustainability, and creating connections. City Council will vote on the updated plans in February.

Council will take action on three other major policy items before the end of March - - the East Side West Side Neighborhood Standards, the Poudre River Floodplain Regulations and Green Building. Like many policy changes that Council considers, these issues elicit strong opinions and differing perspectives, as well they should. Each decision we make directly impacts our community and directly impacts you. So I encourage you to get involved. If we all commit to respectful debate and healthy dialogue, we can find the solutions that best fit our entire community.

Citizen involvement starts at the ballot box. In April's municipal election, Fort Collins will vote on a new Mayor and three City Council seats. These elected policy makers have a fundamental responsibility to shape the future of our community.

You can, and should, expect excellence from your local government. Last year we launched an organization-wide performance excellence initiative. We're serious about customer service and continuous improvement. With that in mind, I'm excited to announce a new online customer service initiative called Access Fort Collins. Access Fort Collins will be a one-stop-shop for submitting questions or concerns, and tracking the City's response - 24 hours a day, 7 days a week, 365 days a year. By the way, it accepts compliments too.

In all seriousness . . . City employees care about the work they're doing, and I believe they do it exceptionally well. In many instances, the City of Fort Collins IS the best practice organization. Later this year, the Alliance for Innovation will host a conference in Fort Collins, called "BIG Ideas". 100 City managers and other public officials from across the country will come here to learn from Fort Collins and share ideas.

This speaks highly to caliber of our City employees. To my colleagues in the room and to those watching, I want you to know that I truly appreciate you. Would you please join me in saying thanks?

It's also a privilege to work in partnership with Mayor Doug Hutchinson and our elected officials. Together, we've built a strong foundation, and I truly believe that Fort Collins has a promising future in store.

I'd be remiss if I didn't say a few words about the contributions of this guy standing next to me. As you know, due to term limits, this is Mayor Hutchinson's final State of the City Address. Doug is a mentor, a colleague, and a personal friend. He is everything that local government should be: accessible, engaged, and always guided by the best interest of Fort Collins.

I also want to recognize his wife and life-long partner, Cathy. Cathy, thank you for supporting the countless hours Doug has devoted to this organization and this community.

Mayor Hutchinson - - Cathy - - I want you both to know that you have undoubtedly left your mark on Fort Collins. Thank you.

Darin, I appreciate your comments. Thank you for your service, and for your dedication to Council, to our community and to the City workforce. Fort Collins could not have a finer City Manager.

It truly has been my honor and privilege to serve as mayor for almost six years now.

I ran for Mayor because I wanted to give back to the city I grew up in-to the city that I love. And because I believe in Fort Collins. That was reflected in my campaign slogan "Together we can." We have an awesome community of great people and we can accomplish virtually anything-if we work together.

I strongly believe that collaboration and working together applies to City Council as well. The finest moments of council have been when we have worked tough issues by bringing our differing views to the table, identifying the common ground, and then working together collaboratively and civilly on the remaining differences-to do what's best for our community.

We've proven it can be done. There are those who, recognizing some of the major values differences between - say - Mayor Pro Tem Kelly Ohlson and me, would rule out any possibility of productive compromise. They would be wrong.

Kelly and I, and of course other Council members, have been able to have honest, intense debates on major issues. We've worked collaboratively to create positive results, results that can survive shifts in the so-called "majority" on Council. Thank you, Kelly, and thank you, Council.

A superb example of productive collaboration is about the most important single function that Council performs: the budget. Six years ago, at my very first Council retreat, we totally threw out the old bureaucratic budget process and instead focused the budget on YOU, the people of Fort Collins-with simplicity and transparency.

You watched us cut spending, improve efficiencies, and reduce the size of city government for 5 years, and when the cuts were truly affecting the services you needed and expected, you had the basis for making a rational choice about taxes.

So now, as we look ahead, the State of our City is strong. The future of Fort Collins is bright-and our future is full of promise. Together, we can fully achieve that promise.