HomeMy WebLinkAbout09/24/93 BAKERSFIELD
MEMORANDUM
~'/ September 24, 1993
TO: HONORABLE MAYOR AND CITY COUNCI
FROM: ALAN TANDY, CITY MANAGER
l/
SUBJECT: GENERAL INFORMATION
1. The County has asked staff members to attend eting Monday, October 4th,
on the subject of creating a Metro-Wide County Service Area for parks and
recreation purposes. This overlays, greatly, with the Council's inquiry on
the Metro Parks Plan. We will report back to you as soon as we know some
details. We believe they are trying to pick up the same concept using the
CSA statutory option.
2. The next Intergovernmental Relations Committee meeting has, apparently,
been delayed by the County until the end of October.
3. You will find enclosed copies of some peculiar communications from the
County on the Rosedale and Union Annexations. You'will remember that we
put those on hold, due to the conflicts over the Fire Fund and tax split
issues, but they continue to process the tax splits anyway. The letter
enclosed from Judy Skousen explains why we find their communications to be
rather peculiar.
4. You will find enclosed a summary of a retention meeting our Economic
Development Department had with Freymiller Trucking. They are outside the
City limits, but contiguous to us. Nonetheless, the retention efforts
seemed desirable.
5. I will be taking next Thursday and Friday (September 30th and October 1st)
off. John Stinson will be in charge during my absence.
6. The new Engineer IV in the Public Works Department is Jack LaRochelle - an
internal promotion.
7. Enclosed you will find copies of questions and answers about the Hotel.
Members of the CDDA have asked for these materials. We are also providing
them to you as background.
8. A memo from the Fire Department is enclosed indicating that they have
received enough funding to proceed with the Defibrillation Program on a
City-wide basis.
9. You will find enclosed the letter I sent Joe Drew the morning after the
Council Meeting relative to the Fire Fund issue. Public relations
materials released in accordance with Council direction on this issue are
also enclosed for your information.
HONORABLE MAYOR AND CITY COUNCIL
September 24, 1993
Page -2-
10. You will find enclosed copies of Economic and Community Development's
responses to the letter we received from the A. Philip Randolph group on
the use of CDBG funds for economic development functions.
11. With respect to the Convention Center Hotel, the negotiations on the DDA
are going well and we are making good progress. With respect to a press
release, the Hammons people got tied up with airplane troubles on a New
York trip and did not get materials to us. I will let you know early next
week what is going on.
12. The three finalists for the Water and Sanitation Manager position are all
from California. Two are internal.
13. We may have "beaten down" one County effort to get our money - a letter
from Fred Drew is enclosed seeming to withdraw on the ambulance billing
effort.
14. Enclosed is a copy of a letter to the Board of Supervisors from the County
Waste Management Department regarding the formation of CSA 82 (Old
Stockdale). This matter will be heard before the Board of Supervisors at
their meeting of September 28th, at 2:00 p.m.
AT.alb
Enclosures
cc: Department Heads
City Clerk
JAM~$ '~. RHC~ADES Admial.~
Auditor-Controller ~ 118 T~ A~
B~ ~ ~1~
(~) N1~1
D~ ~
EDW~D · ~OHNiTON
8EP 1 7 1993
~e~n Count~ ~n~st~ative
Sake:s eld, 9330[ RLANNING
Gen:lemen:
In acco:dance ~h Section 99 o~ the Revenue and ~axa[~on Code,
you: Agency ~s subject [o a se:v~ce a:ea o: se~ce :espons~b~l~[y
change due :o an annexa:~on ~:oposal ~led ~:h :he ~ocal Agen~
go~a:~on Co-mission by :he C~[y o~ Bakersfield and assigned
~:oceed~ng No. [[40 [o C~y o~ Sake:s~eld ~exa~on ~ 377.
~e es~t~a:ed amount o~ ~:ope::y ~ax :evenue gene:a:ed du:~ng ~e
cu::en: ~scal yea~ ~h~ch ~s a[::~bu:able :o yo~ agency
a:~ached.
A 30 day ne~o:~a:~on pe:~od s:a::s Septe~et 14, [993, and a11 :ax
:evenue exchanges ~us: be adopted by Agency Resolu:~on by
Oc:obe~ [3, [993. [~ :he nego:~a:~ons a:e no: co~ple:ed ~:h~n ~e
30 day pe~od, :he annexation p:oceed~ngs a:e ~e~na~ed and
be :e~led ~h ~ECO.
[~ you: Agency has any ~ues:ions as :o :he :ax :evenues
~nc:emen~ ~ac:o:, please con:ac: ~y o~ce a: (805) 861-233[ e~
3516.
S ncetly
AUD[~OR-CON~RO~
~n K. Barnett
Property Tax Accountant
~/ksb
attac~ent
cc: City of Bakersfield'~
~FCO
Estimated Amount of Property Tax Generated Attributable
to County Funds
057-038 070-003 070-004 070-008
General' 0.00 242,063.04 (661.44) 0.00
.29.4852% 33.3016% 33.2736% 36.3496%
Fire 0.00 79,281.04 20.43 0.00
8.6252% 9.7416% 9.7333% 10.6031%
070-009 070-012 070-016
General 12,755.77 0.00 478,402.88
32.3264% 33.3016% 33.3016%'
Fire 3,731.46 0.00 141,070.80
9.4563% 9.7416% 9.7416%
JAI~S_ ~ <~HOADES Admlni.~r.m. Cem.~ '.
' ~udl~on~oIl~~ 11~S T~
B~ ~ ~1~
F~ (~) ~1~
~1 L BU~
Kern County A~inistrative Office . 17 ~.~
1415 Truxtun Ave., 7th Floor o~Y o~
Bakersfield, CA 93301 PLANNING
Gentlemen:
In accordance with Section 99 of the Revenue and Taxation Code,
your Agency is subject to a service area or service responsibility
change due to an annexation proposal filed with the Local Agen~
Fo~ation Commission by the City of Bakersfield and assigned
Proceeding No. 114~ to City of Bakersfield ~nexation $ 378.
~e estimated amount of property tax revenue generated during the
current fiscal year which is attributable to your agency is
attached.
A 30 day negotiation period starts Septe~er 14, 1993, and all tax
revenue exchanges must be adopted bY Agency Resolution by
October 13. 1993. If the negotiations are not completed within the
30 day peri~, the annexation proceedings are te~inated and must
be refiled with ~FCO.
If your Agency has any ~estions as to the tax revenues or
increment factor, please contact my office at (805) 861-2331 e~
3516.
Sincerly,
J~ES A. ~O~ES
AUDITOR-CONTRO~
~/ksb
attac~ent
cc: City of Bakersfield .~
~FCO
Estimated Amount of Property Tax Generated Attributable
· to County Funds
056-001 056-016 056-018 056-020
General 0.00 0.00 12,483.82 ~ 39,157.49
32.5489% 32.5585% 32.5491% 32.5221%
Fire 0.00 0.00 3,694.83 12,194.71
9.5215% 9.5238% 9.5215% 9.5135%
056-038 056-039 056-040 056-044
General 20,179.34 18,73'8.38 10,039.21 23.15
32.5490% 32.5490% 32.5219% 32.5490%
Fire 5,903.00 5,481.53 3,785.69 6.77
9.5215% 9.5215% 9.5135% 9.5215%
056-045 056-049. 056-050 056-081
General 13,444.48 83.62 0.00 67,990.05
32.5221% 32.5490% 32.5547% 32.5489%
Fire 3,932.72 24.46 0.00 19,907.65
9.5135% 9.5215% 9.5265% 9.52.15%
CITY O~
CITY A~ORNEY OFFICE OF THE CITY A~O~EY PH. 805-326-3721
LAWRENCE M. LUNA~INI FAX 805-325~9162
1501 TRUXT~ AVENUE
CHIEF ASSISTANT CITY ATTORNEY BAKERSFIELD, CA 93301 DEPUTY CITY A~O~EYS
JUDY K. SKOUSEN ALLEN M. S~W
WALTER H. PO~, JR.
ASS~SXA~'X CiTY ATTOa~VS 3¢pEembe~ 2 2, ~ 9 9 3 ~4ic~ G. ~OaD
ROBERT M SHE~Y
ALAN D. DANIEL ADMINIST~TOR
LOUISE T. CLOSS F~NCES E. THOMPSON
JOHN D. CLOSS
LAU~ C. MARINO
J~es A. Rhoades
Auditor-Controller
County of Kern
1115 Truxtun Avenue
Bakersfield, CA 93301
A~tn: Ann K. Barnett
Re: Annexation proposal filed by the City of Bakersfield,
City Annexation ~377, LAFCO assigned No. 1140
Annexation proposal filed by the City of Bakersfield,
. City Annexation %378, LAFCO assigned No. 1141
Dear Msl Barnett:
i have reviewed your letters, dated Septe~er 13, 1993,
regarding the' above-described proposed annexations. The Finance
Director, Mr. Greg Klimko, has also spoken with you regarding the
information provided to the City in those letters. It appears from
my review of the letters and your co~ents to Mr. Klimko that the
letters fail to meet the requirements of Revenue and Taxation Code
~ 99 sufficiently to co~ence the thirty-day period within which
the City and County have to negotiate the tax distribution between
such parties.
Specifically, I am unable to determine from the letters
whether these n~bers represent tax increments or the full ~ount
of taxes generated within the territory which is the subject of the
jurisdictional change during ~he current fiscal year. it is my
understanding that you advised Mr. Klimko that the figures set out
in your letters represented tax .increments and not the full ~ount
of taxes generated, which explains why a debit n~er is shown for
one tax code area. your letter, however, indicates the figures
represent the full ~ount of estimated, taxes generated in those
I~ANA~~s' My reading of the Code indicates t~a~ your office must
22 SEP 93 ~ 26
James A. Rhoades
September 22, 1993
Page Two
provide us with an estimate of the amount of property tax revenue
generated within the territory which is the subject of the
jurisdictional change during the current fiscal year and an
estimate of what proportion of the property tax revenue is
attributable, to each local agency.
Perhaps I am not understanding completely the information
provided in your letters; and in that case, I would welcome further
explanation. But in the event I am c°rr.ect and your office has not.
provided an estimate of the full amount of .taxes generated, please
issue new letters containing that information. These new letters
would then start the thirty-day negotiation period.
Please telephone my office if you have any questions or feel
.further discussion would assist in this matter.
Very truly yours,
.... / ;' ,: .,;.';
JUDY K. SKOUSEN
Chief Assistant City Attorney
JKS: rb
cc: Alan Tandy, City Manager
Gregory Klimko, Finance Director · ·
Joseph Drew, County Administrative Officer
LAFCO - Attn: William Turpin, Executive Director
skousen[letters\rhoades. 922
MEMORANDUM
September 23, 1993
TO: Alan Tandy, City Manager
FROM: Jake Wager, Economic Development Director
SUBJECT: Freymiller Retention Meeting_
On Wednesday, September 22, 1993 a meeting was held at the KEDC office to discuss the
development of a strategy to retain Freymiller Trucking at its current location. In attendance at
the meeting were the following individuals representing various organizations:
Sharman Cummins - KEDC (host), Vice President
Bill Mungary - Kern County Community Development, Director
Paul Sipple ~ Kern County Community Development, Economic Development Manager
Sarah Parker - California Employment Department, Employer Services Representative
Dave Snyder - California Trade & Commerce Agency, Associate Development Specialist
Jeff Johnson - Small Business Development Center, Director
Karen Jones - Employers Training Resource, Manager, Personnel Consultant Division
Jake Wager - ED/CD City of Bakersfield, Economic Development Director
David Lyman - ED/CD City of Bakersfield, Principal Planner
After a brief overview by Dave Snyder of the Freymiller project, the group quickly focused on
what I-would describe as real practical options available to public agencies whose goal is to
retain Freymiller Trucking as a Kern County business.
The strategy that developed as a result of the spirited participation is a desire to set a meeting
with Jerry Stanners, Freymiller's CEO, and other Freymiller staff. In attendance on our behalf
would be a representative of each of the agencies represented at yesterday's meeting. A lead
spokesperson would present the ideas generated by the working group. The suggestions that the
working group will be prepared to discuss are contingent upon Freymiller Trucking's willingness
to be very forthcoming in providing detailed company information. This follow-up information,
which would need to be quite specific, could then be used in the preparation of a detailed
proposal outlining possible savings and an comparative analysis of cost of doing business in
California and Oklahoma.
If Freymiller Trucking is willing to provide all the necessary information the working group is
Prepared to expend considerable effort which would lead to a comprehensive proposal. The
proposal would include the following options and analysis:
Labor Cost Comparison - Provided with proper information the working group would compare
personnel cost by SIC code of those positions which might be transplanted from California. It
is our general understanding that even in the event of a relocation certain positions will remain
in place in California. Further it is our understanding that most drivers are either owner/operators
or independent contractors which may not be affected by a relocation. This analysis would also
include the historical labor cost trends in appropriate job classifications.
Workers' Compensation Cost Comparison - The working group would provide a cost comparison
between California and Oklahoma on the cost of Workers' Compensation both before and after
the' reforms enacted in the most recent state legislative session~ Again this analysis would be
limited to the positions which are in jeopardy of being lost to Oklahoma. Analysis would also
include a cost trend analysis.
Self-Insurance Option - Apparently qualified employers may elect to become self-insured in
regards to Workers' Compensation (subject to approval by the appropriate state agencies). This
can result in substantial savings according to Dave Snyder. One possibility would be to assign
a single individual from the State of California to Freymiller Trucking. This individual's sole
responsibility would be to assist Freymiller Trucking in securing the necessary state approval and
thus generate considerable on-going savings.
Job Training Assistance - Subject to Freymiller Trucking's ability to provide historical data
indicating employee turnover broken down by job classification, the working group is prepared
to analyze potential savings through programs presently available through ETR, EDD, Bakersfield
College and the Governor's Employer's Training Panel. The information may also help
substantiate the consideration of utilizing CDBG funds in a business retention and job generation
effort.
State Technology Grant - The working group discussed the advanced technology presently being
employed by Freymiller Trucking, particularly the use of a tracking system. The state will
review its advanced technology strategy to determine if funds could be made available for the
acquisition and application of other advanced technologies for use by Freymiller Trucking.
Alternative Fuel Fleet Conversion - The working group viewed this option as a tree win-win for
the State of California and Freymiller Trucking. Given that air quality continues to be a major
envkonmental concern and that diesel engines (particularly those used in the transportation
industry) are coming under increasing scrutiny, the conversion of all or part of this fleet to either
natural gas or methanol may be a model program that could be emulated elsewhere. Installation
of a natural gas dispensing island at the Freymiller Trucking terminal could be undertaken at
P. G. & E.'s cost. Other natural gas dispensing stations could be placed at other Freymiller
Trucking locations (we believe they have at least one other California location in the L.A. basin
area). The State of California has had funds available in the past to promote the use of
alternative fuels; in fact the City of Bakersfield has participated in this program. Air quality
districts may also be able to provide funding for this type of program. Other potential allies or
funding sources would be other natural gas utilities and the national industry group.
Economic Development Revolving Loan - Kern County Community Development Department
has indicated in the past that they have a substantial sum available for eligible economic
development activity. Would this business retention effort qualify as an eligible project? A
question to be posed to Freymiller is do they have any unmet capital improvement or F. F. & E.
needs which these funds could be applied to.
Creative Real Estate Financing - The working group is prepared to explore the potential of
undertaking a sale/lease back issue or employing a certificate of participation whereby any
existing debt service could be re-financed through a more favorable financial structure. This
option could also possibly include an infusion of capital at favorable terms (such as a longer
repayment schedule and lower interest rates) if Freymiller views itself as undercapitalized.
State Vehicle Licensing - This may not be an option as much as it is an examination of current
practices and its impact of California-based tracking operations. There was some discussion that
California-based operations are paying for truck registration which may have a higher cost than
the permit fee charged to out-of-state operators.
Cost of Living Trends Analysis - It may be reasonably assumed that Oklahoma currently enjoys
a lower cost of living (housing, utilities, schools, property tax, etc.). This analysis would attempt
to establish the cost trend associated with these various quality of life issues. Are costs
escalating at a faster pace than Kern County's?
In closing, Freymiller Trucking is available to meet with this working group the week of October
11 to initiate our effort to retain this valued member of our community. This is the earliest time
Mr. Stanners has available. If you have any questions please contact me.
CONVENTION CENTER HOTEL
Questions and Issues
1. Financing, if available at all, is an extremely onerous element in today's bUsiness climate
due to the high equity requirements.. Why are we helping the developer obtain 100%
financing? What risks are being absorbed by John Q. Hammons?
This question begins with the very reason why the City and CDDA have agreed to act as the
conduit for the financing necessary to complete the downtown Convention Center Hotel. In
today's financial environment, banks have become extremely conservative. This is particularly
true when it comes to financin'g any new hotel. It is important to understand, that while the City
and CDDA have agreed to help John Q. Hamm°ns obtain the necessary financing, neither the
City nor the CDDA will be liable for the debt service. ~The obligation for servicing the debt will
rest solely.on John Q. Hammons. As a private company they also are assuming th~'prof'xtability
risk of the Hotel project. As is typical in any hotel venture, the Hammons Group is fully aware
that the cost of operation Will initially outstrip the revenue produced by the sale of rooms. Mr.
Hammons has incorporated this reality into his business decision.
2. Has the City reviewed the financial strength of John Q. Hammons Industries and of
John Q. Hammons himself?.
The City Of Bakersfield has reviewed the basic credentials of Hammons, but has not initiated an
in-depth review. The bond rating agencies will be undertaking a rigorous review of all aspects
of John Q. Hammons Industries and of Mr. Hammons personally. The availability of financing
will be largely contingent on a meticulous examination by independent financial experts and their
assessment of the strength'of Mr. Hammons.
3. If the developer decides to simply walk away from the hotel sometime after it opens, what
are the consequences to him? What incentive does he have to stay and do a good job? What
recourse would the City have?
In the unlikely event that something takes place .which forces Mr. Hammons to "walk away,"
his obligation to satisfy the debt obligation is not diminished in any fashion or form. The first
risk is that the bond trustee acting on behalf of the bondhOlders would be able to foreclose on
Mr. Hammons' property. Secondly, Mr. Hammons personal guarantee could be called.
In regard to the City's recourse, there are many. First all of the assistance he has been granted
and all assistance still due him' will either be required to be returned, repaid or cease to be
forwarded. His incentive to stay and do a good job is that this is what he does and has done for
over four decades. He is first and foremost a hotel developer/operator. He owns and operates
nearly 100 hotels in thirty-eight states. His business knowledge and the vast resources available
to him make it unlikely that he would simply "walk away" or that he would choose not to stay
and do a good job.
4. If the actual cost to complete the hotel turns out to be less than the actual funds raised
through the grant and sales of bonds, what happens to the unspent funds?
In the event that the actual cost tums out to be less than the funds made available to John Q.
Hammons through the sale of bonds, any such ·funds remaining would be applied to reducing the .
total amount of hotel bonds outstanding. MOnies will onlY be released as work is completed
through a draw schedule that will allow the City to monitor the expenditure of funds.
5. Are the underlying assumptions in the project proformas (development and operational)
accurate? Rumors have it that a room rental rate of $75/night is being used in the proforma
when the average rate in Bakersfield is closer to $60/night.
In discussing John Q. Hammons' underlying assumptions with his financial team they have
indicated that their calculations are based on average daily rate of $70 per room.' Again, based
on not just Mr. Hammons thorough knowledge of the hotel industry but also that of his team,
they are secure in their assumptions and that this rate will work. Is' there someone else who is
able to demonstrate a deeper knowledge of the hotel industry, whose personal wealth is in excess
of $300 million and whose wealth has been developed over a span of four decades in the hotel
industry? The City staff does not pretend to second guess the projections of the Hammons firm
relative to the potential profitability of the facility. Hammons is operating in Sacramento and
Fresno among a variety of other locations and is thoroughly familiar with p~otential business in
this area.
6. If the developer fails to fund the debt service of the bonds related to the hotel, what effect
does this have on the entire bond sale?
The repayment obligation of each component of the sale, such as the Hotel, Northeast sewer,
etc., are separate and distinct. Failure of one element is a separate issue from the others.
7. If hotel opens and is not profitable, is John Q. Hammons personally liable to the bond
homers?
Yes. In addition to having to.provide his personal guarantee, Mr. Hammons would be risking
all City incentives since they would fall through in the event that the hotel does not continue to
operate. 'These include the alcohol and catering concessions, the right to lease the ballroom.
He woUld also be ,responsible for repayment of the federal loan as well.
8. What is the developers and the City's liability if the developer fails to meet the terms of the
federal loan?
If Mr. Hammons fails to hire the appropriate number of low and moderate income individuals
at the commencement of operation or for the next subsequent five years he will be required to
· pay the balance of the principal remaining, plus 9% interest going back to the date on which the
funds where made available to him. At the onset, the Hammons Group will therefore be
required to make in excess of 100 jobs (of the two hundred permanent jobs presently estimated)
available to low and moderate income individuals. From that point and for the next five years
a minimum of fifty-one percent of all hires (resulting from turnover or an expanding workforce)
must also be made available to low and moderate income individuals.
9. Questions have been raised as to the appropriateness or even the legality of using federal
funds to assist John Q. Hammons in reducing the cost associated with completing the
Convention Center Hotel. Can CDBG funds be used in the downtown area for economic
development?
HUD regulations make it absolutely clear that CDBG funds can be used for economic
development activities. The eligibility for this particular project rest not so much with its
location but with the fact that the completed hotel will provide apprOximately 200 permanent
jobs, of which 51% must be available to low and moderate income individuals (at the time of
hire). Stepping back for a moment, it must also be pointed out that according to the' 1990 census
information, Census Tract 16 (which is predominantly composed of the downtown area and
includes the hotel site) is a HUD eligible area.
I0. If the City were a private business, what would be its motivations for providing incentives
for this project? Some of them follow.
® Our unemployment rate is currently over 10%. This will create'nearly 200 construction
jobs and'nea~ly 200 permanent positions, that will primarily be filled by Iow and
'moderate income residents.
The project will spend at least $5.5 million per year in the downtown economy and will,
therefore, help other businesses to flourish such as restaurants, after-hour locations, retail
facilities, and the like.
· We currently are not competitive for larger convention's or conventions which require the
primary lodging to be within walking distance of the convention center. This will open
up Bakersfield to attract larger conventions and will allow for more~full booking of the
convention center itself.
· As the convention center itself is more fully booked, it will reduce its annual operating
deficit which is a benefit to all taxpayers of Bakersfield.
· The City's only incentive is in the form of a pass-through of a federal grant to the
developer and are a portion of the new taxes that the hotel .itself will develop. There is
no out-of-pocket expense to the City to bring this project into being, yet we know it will
generate at least a half million dollars in new taxes per year for the City after it gets
geared up and is fully operating. A generation of such taxes will help to reduce the
I,
burdens on other property taxpayers in the downtown area and throughout the City.
· The land, with improvements currently in place, represent a liability, not an asset. The
structure could cost up to and even over $1 million to demolish which would have to
come out of the City's general funds. The general fund dollars are needed for public.
safety and other community services.
· The addition of the ballroom to the package will mean that the City will have to turn
down far fewer events at the convention center than we currently do. Thirty events have
been turned down within recent months because we were already booked. Many of these
could have been accommodated if we had the usage of 'the ballroom.
· In short, it simply makes good business sense for the City of Bakersfield to try within
reasonable limits to facilitate construction of this needed community facility.
11. If you complete the Convention Center Hotel for the'purpose of attracting conventions,
will they come?
Conventions have become more and more cost conscious. This gives the affordable California
more opportunities than ever before. A recent press release indicated that Fresno tied for
second, with San Diego, as the most active city in California for professiOnal association
conventions. With the completion of the Convention Center Hotel, and the additional
improvements at the Convention Center, Bakersfield will be given a tremendous opportunity to
bring added conventions to our cOmmunity. This translates to an infusiOn 'of imported dollars
to our local economy. With think Bakersfield has a great deal to offer!
MEMORANDUM ~
"WE CARE"
TO: Alan Tandy, City Manager ~~
From: Stephen Johnson, Fire Chief
Date: September 22, 1993
Subject: RESPONSE TO STATUS OF DEFIBRILLATION PROGRAM
Total funds raised to date for the implementation of the defibril-
lation program is $47,282.34. These funds have been deposited into
a trust account which was set up through the Finance Department.
On August 27th, I met with Laerdal Medical Corp. to review the cost
to purchase the necessary defibrillation equipment. As was
anticipated, the costs have dropped since we were first quoted
prices in late 1991.
A review of the cost to implement the'program is as follows:
3 Loaned Heartstart 1000 Defibrillators: N/C
1Heartstart 1000 (to be traded in) (CREDIT) <$ 4,495.00>
NOTE: Laerdal Medical Corp. has agreed to
exchange the above four 2-year old
defibrillators for new units.
11Heartstart ATS Defibrillators ~/tapes $45,105.06
22 Standard Module Control Units $ 4,290.00
11 Extra Batteries $ 1,100.00
Total $46,000.06
It should be noted that we have switched from a Heartstart 1000
defibrillator to a Heartstart 3000 so as to ensure uniformity with
E.M.S., Kern County Fire Department, and the two ambulance
companies. These new units will also allow greater flexibility for
firefighters and paramedics as they assist cardiac arrest patients.
SDJ:trs
s:\defibsta.2
BAKERSFIELD
Alan Tandy · City Manal~er
September 23, 1993
Mr. Joe Drew
County Administrative Officer
County of Kern
1115 Truxtun Avenue
Bakersfield, CA 93301
Dear Mr. Drew:
Last night, after diScussing the Fire Fund' issue in Executive Session, the City Council
voted to take the following action:
"Since negotiations have been continuing for at least four months, the City
Manager is directed to advise the County that the Fire Fund issue should
be brought to conclusion within thirty (30) days; further, that the City staff
is directed to spend any amount of time necessary to bring a positive
conclusion to the negotiations, and the City Attorney is instructed to
prepare a lawsuit for consideration, in the event negotiations fail."
I believe that this is self explanatory. I would convey it to you as an effort by the .City to
bring the issue to positive resolution. Even though it does reference the potential for
litigation, I believe the emphasis should be on the thirty-day window of opportunity to
succeed. I am prepared to meet with you, or your staff, as frequently as is necessary
to bring it to such a positive conclusion; as often as daily, if necessary. I will call in
order to have my Administrative 'Assistant schedule the initial meeting.
· If you have any questions, please do not hesitate to contact me.
Sinc~ely, .
City Manager ~ .~.
AT. alb
cc: Honorable Mayor and City Council
City Clerk
City of Bakersfield · City Manager's Office · 1501 Truxtun Avenue
Bakersfield · California · 93301
/O~C'~ '3'3~ '"3'""/E"1 ,,~ [~.. IO/'~'~ ')'34 I0~"~'~
BAKERSFIELD
September 22, 1993
A. Philip Randolph
Community Development Corporation
1313 California Avenue
Bakersfield CA 93304
Attention Marvin Dean:
The City of Bakersfield, EcOnomic-& Community Development Department staff
received your letter dated September 7, 1993, concerning your. objection to the City
submitting a Section 108 Loan Guarantee application for the Bakersfield Convention
Center Hotel Project. Please find. responses to your concerns.
Question #1: "The loss of $375,000 of future Community Development Block Grant
Entitlement Funds for the eligible Southeast Bakersfield incentive area
project for the next ten years (totaling the loss of 2.5 million)."*
Answer #1: Since the first year the City partiCipated in the CDBG program, our.
entitlement has increased from $820,000 in 1977 to $2,525,000 in
1993. This represents an increase funding of 200% in sixteen years.
The Community Development Block Grant entitlement by statute, is
required to benefit the Iow and moderate income population of the
entire City of Bakersfield. Your statement that these funds are for
exclusive use of the Southeast Bakersfield Incentive Area is incorrect.
The City of Bakersfield Community Development' staff would gladly
provide a map delineating those areas .meeting U.S. Department,of
Housing and Urban Development Department (HUD) Iow and
moderate income criteria.
The Bakersfield Convention Center Hotel .project is located in Census
Tract 16, which has been designated by HUD as a "low and
moderate" income area. The proposed $2.5 million financial
assistance ($375,000 for a maximum of 10 years) for the Bakersfield
Convention Center Hotel project will not only be expended in a eligible
area, it would also provided jobs for Iow and moderate income
individuals.
*NOTE: All questions were taken directly from Mr. Dean's letter dated 9/17/93.
Ci~ of Bakersfield · EcOnomic and 'Community Development Department
515 Truxtun Avenue · Bakersfield · California 93301
(8~15~ 326-3765 · Fax (805/ 328-1~48 · TDD ~805~ 324-36'~1
Page 2
9/22/93
M. Dean Letter
Question #2: "There is no guarantee for minority or women subcontracting
opportunities which is generally required on Community Development
Block Grant. funded projects."
Answer #2: HUD .regulations do not guarantee opportunities for minority or women
subcontractors on CDBG projects. HUD does, however, require that
contractors and subcontractors on federally assisted construction
projects take affirmative actions to ensure fair treatment in
employment and to the greatest extent feasible provide opportunities
for training and employment to Iow and moderate income persons.
The~City of Bakersfield will assist the developer in all possible respect
to maximize the use of local labor and vendors.
The assistance proposed for the Bakersfield Convention Center Hotel
developer will not finance the construction of the hotel project. It will,
however pay for those pre-opening and eligible Fixture, Furniture and
Equipment costs to complete the Hotel project. The HUD - Los
Angeles Office has concurred that the activities proposed for the
Section 108 assistance will neither initiate Davis Bacon requirements
nor constitute a construCtion project.
Question #3: "There is no guarantee that minority, women, and disadvantaged
persons will be employed in the higher paying construction jobs or in
the operations management positions."
Answer #3: HUD regulations do not guarantee minority, women, and
disadvantaged persons employment in higher paying construction jobs
or in the operation management position. As mentioned before, HUD
does require that to the greatest extent possible, training
opportunities and employment for Iow and moderate income persons
be provided. The City of Bakersfield stands ready to assiSt the
developer with all possible means.
Question #4: "The City of Bakersfield has already wasted several million dollars on
local, state and 'federal funds intended for the citizens of Bakersfield
on the Convention Center Hotel project, eStimated at 5.5 million
dollars."
Page 3
9/22/93
M. Dean Letter
Answer #4: To date no federal funds have been expended on this project. The
same can be said about state funds. The only funds expended to
date are tax increment funds generated solely from the
redevelopment project area. "Wasted" is a relative term.
Question #5: "We believe that the Community Development Block Grant
Entitlement Fund was not authorized by congress for this type of
abuse £e. (giving profit developers' 2.5 million dollars in entitlement
funds for projects which are outside of the HUD designated target
areas, 'without providing any LONG TERM benefits to IOw income
residents within the HUD designated target area). The Community
Development Block Grant funds are .the only monies available to
develope projects to improve the conditions in the Iow income
neighborhoods, such as the Southeast Bakersfield Enterprise Zone
Area. Because of the need to improve riving conditions in Iow income
neighborhoods, the City of Bakersfield received their Community
Development Block Grant Entitlement."
Answer #5: In accordance with HUD regulations for the Community Development
Block Grant program, 24 CFR Part 570.203 -- Special economic
development activities, assistance to private for-profit businesses is an
eligible activity. The assistance can be 'for grants, loan, loan
guarantee and other forms 'of support. Section 570.208(a) -- Criteria
for National Objective, states that activities where at least 51% of the
permanent jobs involved employment of Iow and moderate income
persons is consistent with the Iow and moderate income benefit
requirement. Of the proposed 201 permanent jobs to be generated
as a result of the Bakersfield Convention Center Hotel project, it is
estimated that well over the minimum required will be offered to Iow
and moderate income individuals.
. Question #6: "Once again the City of Bakersfield Community Development staff
whose primary responsibility is to work with the residents,
neighborhood organizations, local business owners and area elected
rePresentatives to come up with projects in the impacted HUD
designated areas. To benefit Iow income neighborhoods by
developing projects within the neighborhood which will assist in the
overall economic development activities. By removing blight
Page 4
9/22/93
M. Dean Letter
conditions, ass/sting with providing housing opportunities, developing
neighborhood retail centers, providing job opportunities, assist
neighborhood business owners with start up and expansion loans,
and other economic development activities. Instead the city
Community Development staff is recommending yet another project
such as the Tegeler Hotel in the Downtown area.. Which received
Community Development Block Grant Funds and redevelopment
.agency funding. That developer did not use local minority/women
sub contractors nor did he provide opportunities for minority/women
in the construction jobs. Now the city Community. Development staff
is recommending another developer be given 2.5 million dollars of
future Community Development entitlement fund to be paid back at
the rate of $375,000 a year for the next ten years for the construction
of the Bakersfield Convention Center Hotel without providing any long
term benefits to Iow income residents which the funds are intended
for. Which HUD requires when CDBG funds are used. This project
proposal has been structured to get around these requirements. It
should not be aloud to happen."
Answer #6: The Tegeler Hotel project is located in Census Tract 16. Census
Tract 16 is one of the areas located in Bakersfield that HUD has
identified as an eligible (1970, 1980 and 1990 Census information)
Iow and moderate income areas. According to HUD's 1990 census
information, 70.2% of the individuals residing in Census Tract 16 are '
at or below the Iow and moderate income level. The Tegeler Hotel
project will be providing 53 of the 53 affordable housing units to very
Iow income individuals for the next 50 years. The City's partiCipation
in the Tegeler project was for acquisition assistance only. The actual
rehabilitation construction assistance of $1.8 million was made by the
California Housing Rehabilitation Program (CHRP). The City had no
responsibility in the monitoring of this rehabilitation project. In
accordance with 24 CFR 570.202, eligible rehabilitation and
preservation activities, CDBG funds may be used to assist private,
profit making entities in acquiring properties for the purpose of
rehabilitation of affordable housing for Iow and moderate income
individuals.
Page 5
9/22/93
M. Dean Letter
The Bakersfield Convention Center Hotel project is also located in
Census Tract 16 as mentioned before, Census Tract 16 is a-HUD
designated Iow and moderate income area. The Bakersfield
Convention Center Hotel project will be requiring that as a minimum,
51% of the permanent full-time position be reserved for Iow and
moderate income persons. The Bakersfield Convention Center Hotel
developer has extensive experience in the hotel industry. The project
will have a positive economic impact on an eCOnomically distressed
and blighted area. There will be many positive contributions to the
downtown and to the entire community when this project is realized.
Question #7: "Currently there is an over supply of hotel room space. Several
hotels have already closed their doors. This proposal which would
provide a $2.5 million dollar grant, plus a waiver of hotel bed tax for
the first six years est/mated to be $200,000 a year. The total dollar
amount give away will be $3,7 million ($2.5 million + $1.2 million).
This arrangement would be unfair to other hotels operating in
Bakersfield. This may force other existing hotels to close their doors
due to the loss of business because of the over supply of hotel room
space."
Question #8: "The city proposal is a bad deal for both the Iow income
neighborhoods. It mortgages future Community Development Block
Grant entitlement for the next ten years without any long term ben/fit
to Iow income persons and neighborhoods that the entitlement was
intended for by congress. Also it's a bad deal for.the existing
downtown hotel industry which will cause financial hardship on current
hotels operating due to the subsidizing for Bakersfield Convention
Center Hotel by the City of Bakersfield."
Answer #7 & 8: The City Manager's Office has attended several meetings with
managers of those hotels who would be most impacted with the
completion of the Bakersfield Convention Center Hotel. Although the
association has yet to formulate an official 'position on the hotel
proposal, they believe that the completion of the project, would in the
long run benefit the entire local hotel' industry. This long range
benefits would result.in added transient occupancy taxi added
convention days and added support to the Visitors and Convention
Bureau. The transient occupancy tax funds 'the operation of the
Convention Bureau that was established to promote convention
marketing and visitor attractions.
Page 6
9/22/93
M. Dean Letter
Question//9: "The A. Philip Randolph Community Development .Corporation which
is a community housing development organization (CHDO) targeting
projects in the SouthEast Bakersfield incentive area, We have
repeatedly proposed housing and economic development projects
seeking Community Development Block Grant from Community
Development staff. To date we have not been successful in receiving
any funds for the much needed projects.. We would request at this
time that staff be instructed to provide technical assistance to our
organization in identifying/developing projects for CDBG funding
consideration,"
Answer ,,~9: .The proposals previously submitted by A. Philip Randolph Community
Development Corporation have been reviewed along with those from
other organizations seeking CDBG assistance at the time. The
stronger proposals were funded and completed. Your request fOr
technical assistance in identifying/developing projects has been noted.
Question #10: "We are proposing that the City of Bakersfield consider'to give this
unfinished hotel to a firm who would guarantee, the completion of. the
project with the conditions that the firm must provide its own
financing, provide opportunity for minority/women sub contracting in
all areas of employment. This would be a benefit to the developer
because they' would receive a partially completed hotel structure
valued at several mill/on, est/mated at 5.5 m/Ilion dollars."
Question #11: "Other issues to be negotiated would be concerning wavier on
building permit cost, fees and short term relief on hotel bed tax. This
could be done by advertising the project locally, state wide, .nationally
and internationally as a give away incentive for a developer to
complete the project. The citizen of Bakersfield shouldn't be asked to
put any additional.financial incentives into this project. This project
has already loss several million of dollars of local tax payers money.'
The current proposal by the City of Bakersfield Community
Development staff is unfair-to afl citizens of Bakersfield. Again we ask
the proposal by staff not be approved and that you consider our
proposal to complete the unfinished hotel project."
Page 7.
9/22/93
M. Dean Letter
Answer 10 & 11: Soon after'the construction of the Hotel project stopped in late
1988, the City redevelopment agency started their direct marketing
efforts to identify potential developers to complete and operate the
Hotel project. Although many prospective develOper/operator had
the necessary experience in undertaking this projects, obtaining
the necessary financing prevented them from continuing with the
negotiations.
John Q. Hammons Industries responded to the agencies
marketing efforts and in May 1993 a Letter of Intent was signed.
The current proposal caps all permits and fees at .$155,000 which
is the estimated amount of fees required to complete the hotel
structure. The proposal would also require a short term rebate of
property tax and transient occupancy tax. These forms of
assistance alone would not make the developer's project feasible.
The developer requested that the City agree early on to the actual
and appropriate building permit cOst and to not modify it later oR.
In regards to the level of assistance the City has obtained
confirmation from a private financial consulting firm that without
the proposed 108 assistance and the other assistance being
considered, this project could not be completed.
in your letter, opposition was raised concerning the Notice to Public of Request for
Release of Funds and Notice to Public of Finding of No Significant Impact on the
Environment. Since no specific environmental issues were identified no response
could be made. If additional information concerning this project is required, please call
this office at (805) 326-3764.
Sincerely,
-
Com m{,lz~ity Devel~e nt Coordinator
xc: .;~.A!_~.a _n d~ y_,~-c~__ii ~y~_M ~e r__ _~
Jake Wager,'Economic Development
Arnold Sison, HUD Los Angeles
Kern Minority Contractors Association
Im:GGg/DEAN.LTR
B A K E R S F I E L D
Alan Tandy · City Manager
NEWS RELEASE
FOR IMMEDIATE RELEASE CONTACT:
September 24, 1993 Vice Mayor Kevin McDermott
(805) 326-3767
THE CITY OF BAKERSFIELD IS ASKING THE COUNTY TO PAY FIRE FUND TAXES"
At its regular meeting of September 22, 1993, the Bakersfield City Council*announced,
after an Executive Session, the motion relative to the County Fire Fund, which is attached.
Along with making that motion, the Council directed the staff to release some background
material on the subject matter so that the public' would 'better understand what has been
transpiring. A-copy of this release is, therefore, being provided in accordance with Council
direction.
According to government code and resolutions adopted by the City of Bakersfield and
the County of Kern, the County must relinquish the Fire Fund taxes upon completiOn of
annexations to the City. Funds are to be collected and transferred to the City when the annexed
areas become part of the City. That practice had been followed, without exception, after the
passage.of Proposition 13 in 1978, through the mid 1980's. Beginning in the mid 1980's, the
County unilateraJly changed the practice and began to keep the Fire Fund, even when the City
was Providing the Fire service. The action was unilateral and the City was not informed of it.
In essence, the unilateral policy, change was buried in paperwork, under a mathematical formula
that was not clear. The "capture" of the funds was discovered in 1992.
(more)
City of Bakersfield · City Mana§er's Office · 1501 Truxtun Avenue
Bakersfield · California · 93301
Press Release - Fire Fund
Septsmber 24, 1993 ·
Page -2-
Since 1985, over 74 geographic areas, or over 18,000 acres, have been added to the
City, but the Fire Fund portion of those property taxes have continued to flow to the County.
The Fire Fund tax is an allotted portion of the 1% property tax. According to Vice Mayor
Kevin McDermott~ "Our goal is to provide the utmost in public fire protection to the citizens of the
City of Bakersfield. When the residents in these areas requested to become part of the City, we
assured them certain levels of services would be maintained, and fire protection was one of
those concerns. We cannot provide superior fire protection if the County continues to withhold
the City's rightful share of the Fire Fund."
McDermott pointed out that the City and County have had a long history of cooperative
activities. "The City and County have numerous joint agreement policies regarding shared
efforts," said McDermott. For expedient emergency response, the Fire Chiefs of the City and
County agreed to have the "closest company response." This concept eliminates duplication of
services by dispatching the closest available station regardless of jurisdiction. Other shared
services include establishment of a joint-use dispatch center, coordination of in-service training
and instructional services, and arrangement for the joint use of the Olive Drive Training Facility.
According to McDermott, the failure to forward the Fire Fund taxes is the only departure of the
· City/County partnership. "1 am confident that this situation can be resolved without disruption
of service to our citizens."
According to McDermott, the Joint POwers Agreemer~t was adopted in 1980 by the City
and County for-fire protection services. The results of the agreement were to perform studies
(more)
Press Release - Fire Fund
September 24, 1993
Page -3.
and establish boundaries. The document did not address any monetary changes, with the
understanding that the past practice on the Fire Fund tax would continue. Despite State law,
and a resolution adopted by both City and County prohibiting the County from keeping the Fire
Fund tax, the practice continues.
After numerous pleas, over several months, by municipal officers to County elected
officials and administrators outlining this problem, the County has not provided any substantive
response. "This year's loss alone cost City taxpayers $600,000, or the equivalent of nearly 11
firefighters," McDermott Stated.
The JPA, a mutual coverage arrangement for both the City and County Fire Departments,
has failed to provide a method to reimburse fire proteCtion services in each of the department's
jurisdiction. Moreover, during the course of the agreement, the City has provided more services
than it has received from the County. The lack of transferring Fire Funds has further impacted
City taxpayers. According to McDermott, "The City continues to incur costs of providing fire
protection services while the County retains the taxes paid by City residents."'
The motion by the City Council is being made only after foUr months of behind the
scenes efforts to negotiate the matter to successful conclusion. The motion directs City staff to
spend any amount of time necessary, over the next thirty days, to bring the issue to a positive,
non-litigated conclusion. It also recognizes that a fundamental inequity' must be righted - that
is the party providing the service should clearly get the money to do so.
Motion of the Bakersfield City Council
Closed Session
September 22, 1993
Since negotiations have been continuing for at least four months, the City Manager is
directed to advise the County that the Fire Fund issue should be brought to conclusion
within thirty (30) days; further, that the City staff is directed to spend any amount of time
necessary to bring a positive conclusion to the negotiations, and the City Attorney is
instructed to prepare a lawsuit for consideration, in the event negotiations fail.
fom..: the.. l rd .of
~ ~ ~ or: Re~°lution No ...........................
Re~ere~e No .............................
YEAR 1984-gS~ BkKERSFI~LD~ C~LI~ORNIA CITY,
DELANO, SHATTER AND TAFT
~. M. V. ~D~ACH~R. Clerk of th~ 8oa~d o~ $u~e~vi~o~s o~ t~e Cou,~ o~ Kern. Stat~
hereby cart~ that ~e follo~ng re~lution, proposed b~ Supervisor , s~onded
by ~u~i~or , was du]~ passed and adopted by said B~rd of Su~o~ at an
offlc~l meattng ha~eof this .................... day of ......................................... ]9 ........... by the following uote, to wit:
A~S: H.V. RAD~ACH~
Clerk of the ~ard ol Su~a~, Co. IF Of Kern
NOES: State ot CaliJmn~
~: By
ESO. LUTIOn
Section 1. WHEREAS ~
(a). S~=uctura~ f~re protection services are provided by the
County of Kern tn the incorporated and unincorporated
County no= spectftcatly excepted in accordance with Sec~on 25643 of
the Gove=~ent Code of the State of California, which non-e~ee9=ed
azeas comp:ism and arm'constdezed to be a "special dis~=ict"
purposes of allocating p~ope~y tax ~evenues fo: 1984-85 and future
~tscal years pu~suan~ ~o ~he definitions oE "loca~ ageno~es"
tn Section 95(a)., tn Chapter 6, Paz~ 0.5, as added to D~v~ston I o~ the
Revenue a Taxa/ton Code o~ ~he State of Caltfo=nia by Seal,on
Cahp~e~ 282 of ~he Statures of 1979~
(b) ~uzsuan~ =o ~he provisions of ~he aEo=esa~d Section
~he tnco=~ora~'ed Ct~tea of Bakersfield, Cal~fo~nta Cf=y, De[ano,
Sahf~ez, and Taf~ have Riled the~= requests in writing
~zom the levy oE ~axes by the coun=y of ~e=n for st=uut~zal
p=o~eoc~on, and eaoh of which =equea[s ~s supported by a
the respective ot~y council E[ndtng tha= the City has an 0=gantzed
. depaz.tment.'ln being.~hieh. ~s providing adequaae 'e~=uc~uca!
tlOn to &ll property within ~he incorporated areas of:-thn~City,~:.~nd ..-~ ....
fha~ no &dditional lice protection bene~it~ except'aa may..be provided ."
and reimburaed in aoo°rdanoe wi. th a.eepara~o and explioiC.con~cno~-~ is
re~olved or required within ~ho City ~rom ecructura$-£iro pcoteocion
~ ~0#, ?HBREFORB~ IT 18 H~REBY RESOLVBD by the Board o~
l. In accordance with Section 25643 o£ the Oovecn~e~ Code o~
the Steie el Califo~nia~ ~he aforesaid structural lice pzo~eocion
services are not provided by the County ct Kern ce.prOperty within the
incorporated areas of the Cities. ~{_llake_cstl_eld.~_Cali. to~nta
Oelano~ ~hnt~ec~ and Tat~ except as may_be.~XP~iCi~ly...pcovlded and
cei~}s~ pursuant ~o sepacaCe con~cac~ and~ accocdi~gly~ pcopec~y .;/
{{om a~y levy el.taxes by_the Coon~x o~ Kern icc stcuctocal.
onl and ehe. inaocpoca~ed areas of ~he afo~esaid cities s~all be}
exempted icom ~he "special dls~ci~" delineated
95(a) o~ ~he Revenue ~ Taxation Code ct ~he S~a~e
'
purposes o~ determining ~he allocation o~ p=opa~y tax revenues ~o~
mtcuctuc~.l {ice pcoCec~ion services provided by ~he County
Fiscal Yea~ 1984-~g.
1. The Cleck o~ ~he Boacd shall foct~with ~cans~iC certified
copies'ct this cesolu~ion Co the following: '(1) County Admtnis~ca~ive
Offiaezl (2)-County Audi~oc-Contcollac~ (3) City Clack, City
field~ (4)-City Clerk, City of Ca~l{o=nia Cityi (5) City Clerk, Cl~y
Delanol (6) City Clerk, CI~y of Sha{~e=~ and {7) City Clerk,
Ts'ft.
Fred A. Drew ~ 1400 ~ Street
Department Director ~! Bakertfleld, Calffomla 93301
(ee~) ee'l.3aoo
Robert Barnes, M.D. FAX (805)326-0951
Medical Director
DEPARTMENT OF
EMERGENCY MEDICAL SERVICES
September 22, 1993
/John Hendrickson, President
Kern County City Manager's Association
P.O. Box 159
Wasco, CA 93280
John Stinson
Assistant City Manager
City of Bakersfield
1501 Truxtun Avenue
Bakersfield, CA 93301
Re: Your September 16 Letter --Ambulance Billing
Gentlemen:
Thank you for the letter of September 16 (enclosed) and for
attending the meeting at the EMS Department on Friday, September
17, 1993. This letter is written to clarify the EMS position on
several issues, and as a follow-up to the September 17 meeting.
As I mentioned at the meeting, there were a lot of unanswered
issues at the time I sent the August 16th memorandum (enclosed)
regarding possible changes to, and their effect on, the future
private ambulance transportation agreement. Let me reiterate that
it is clear that the EMS Department has no authority regarding City
responsibility for ambulance bills, and there was never any intent
to present that position. Rather, the purpose of the memorandum
was to advise cities and hospitals of prior dialogue related to the
draft Agreement and to engage your interest and participation
because'of potential impact. Also, we do not intend to put any
language in the ambulance agreement which would in anyway instruct
or provide guidance to the ambulance companies on billing
procedures or practices. Our position, consistent with your
feedback, is to revise the draft Agreement for block reimbursement
to cover the maximum possible amount of service provided by the
private ambulance companies.
I hope that the other communication at the meeting cleared up
any other confusion that you· may have had about the EMS
Department's position on these issues. My overall intent is to
maintain an effective comprehensive ~S System throughout Kern
County, including within all the cities.
I am continuing to work with the ambulance companies and
County agencies on the operational and hospital transfer issues.
I will keep you informed as to the progress of the agreement and
these issues. Thank you again for your interest and participation~
FRED A. DREW
Director
Kern County EMS Department
FAD:kb/CTYMGRS9.93
Enclosures
cc: Joe Drew, County Administrative Officer
Members, Kern County Board of Supervisors
EMCAB Members
Kern County City Managers
Kern County Hospital Administrators
Bob Price, Mayor, City of Bakersfield
Bakersfield City Council
Elissa Stone, Deputy County Administrative Officer
Martin Lee, Chief Deputy, County Counsel
BAKERSFIELD Alan Tandy · City Manage[
September 16, 1993
Mr. Fred Drew, Director
Kern County Emergency Medical Services
1400 "H' Street
Bakersfield, CA 93301
Dear Fred:
On August 27th, I receivecl a bill totalling $361.00 ;rom Golden Empire Ambulance
addressed to me for ambulance service provided to a Mr. John Reese on August 1,
1993. I was very confused when I recsived this t~ill.as I aid not know a John Reese r~or
was I aware of circumstances where i or the City of Bakersfield would be responsible for
payment cf his ambulance bill. ! contacted Golden Empire Ambulance and was told that
this was the result of a new Kern County EMS poticy,
I obtained a copy of your memo of August 16'th rc~cjarcling 'Private Ambulance Company
Services" and was surprised to see language where you state that 'public safety
agencies (other than the County of Kern agencies) who call for a private ambulalce
company and do not transport (stand-by, erG,) whic-t~ result in no patient transport, can
expect to be billed by the ambulance company," In addition there is language which
states 'City Police Departments, who call for private ambulance .companies to transport
an arrested individual prior to county booking, or a 5150, will be responsible for the
transport'.
After review of your memo and the bill received from Golden Empire Ambulance by
myeelf and the City Attorney's Office, we have det~mined there is no responsibility by
the City of Bakersfield for these charges, t would also like to point out ttlat the charges
were incurred more than two weeks prior to the date of your memo.
· Due to a conflict, ! was unable to attend the September 9, 1993 EMCAB meeting so I
asked City Fire Chief Steve Johnson to expre.~s my concerns at that meeting. It is my
understanding that there was some discussion about wis m~tte~' and s meeting has
been set for Friday, September 17, to further discuss this matter with those potentially
affected.
I have reviewed this issue with John, Hendrickson, who represents the City Manager's
Association on the EMCAB Board, and we have a number of conce,-ns regarding the
proposed poliCy' crtange.
City~f Bakersfield · City Man~§e~'~ ~)~ce ;":1501 T~-~tu~ Avenue
Bakersfield · California · 93301
Mr. Fred Drew
~epteml~' 1~,
Page -2-
Of primary ooneern to us is what legal authority are you using to propose this =hangs?
We are not aware of any authority of EMS or EMCAB to obligate cities in Kern County
to pay for services required by the County (i.e. 911 caJIs'). We aJso question the possible
disparate treatment of County residents who happen to reside in cities wino would be
required to pay twice for this service. How wou~d this policy work in regard to the City.
County Fire JP^? Would the Ci~ Fire [Department be charged if it responds to an
unincorporated area? Regarding arrested individuals, should cities bill the County when
we arrest a resident of an unincorporated area and are bilJed by the ambulance
companies? This appears to be an attempt to sl~iff county responsibilities without any
comensurate transfer of resources.
I believe there are e large number of concerns which were not thought through or
addressed properly prior to proceeding with your memo. The impact of this policy on
public safety operations could 'be very detrimental. As an example, woulcl a Police
Offloer, Firefighter, or Lifeguard at a public pool think twice before reqLiesting ambulance
services in the event of an poten, tiaJ injury incident, i do not believe it Is your intent to
weaken the emergency response system, which could possibly occur if this policy were
pursued.
The meeting scheduled for this Friday is a good starting point to discuss this matter
further. However, it is necessary that all affected parties notified be allowed sufficient
time to provide information regarding the impacts of this policy before it proceeds a,qy
further.
Sincerely,
John W. Stinson
ASsistant City Manager President
Kern City Manager's Association
cc. Alan Tandy, City Manager
Joe Drew, Courtty Administrative Officer
City of Bakersfield, Mayor and City Council
Kern Coulqty Board of Supervisors
EMCAB Boardmembers and alternates
Kern County City Managers
· '-' EMERGENCY MEDICAL SERVICES DEPARTMENT
MEMORANDUM
Fred A Drew
Roi)er, Barn, es. M D
August 16, 1993
TO: Kern County Hospitals
Kern County Public Safety Agencies
FROM: Fred Drew, Director
SUBJECT: PRIVATE AMBULANCE COMPANY SERVICES
For the past several years, and up until June 30, 1993, the private
ambulance providers in Kern County had an agreement with the County
of Kern for reimbursement of medical transportation services
provided to indigents and "County-responsible patients." That
agreement terminated on June 30, 1993, and it is anticipated that
a new and different reimbursement method will be used in FY-93/94
and beyond. This memorandum provides you with general information,
as it is now available, on the prospective changes, significant
aspects of the agreement, and most importantly, what this may mean
to you in your dealings with the private ambulance companies.
The former agreement was very liberal in its definition of "County-
responsible" patients. Included in that definition were patients
that were unable to pay after ambulance service billing efforts
were unsuccessful, even though the County only has a legal
responsibility to provide for care and transportation of classified
indigents. For several years there were many cases where payments
were made for these services, which were not actually the
responsibility of the County.
Unfortunately, with the current fiscal crisis, this past liberal
process must be refined. With the current budget situation and
according to Board of Supervisors' direction, the agreement has
been scrutinized carefully, and a new system of "block-
reimbursement payment# for services will be implemented. These
reimbursements will provide quarterly block-payments, at a level
set by the Board of Supervisors, for the services provided by the
private ambulance companies to indigents through the 9-1-1 System
and certain Public Safety Agency calls. The payments w~11 not
cover hospital transfers. Transferring hospitals should consider
coordinating with an ambulance company to arrange for hospital
transfer.
By Ordinance/Regulation, the ambulance providers are required to
respond to Public Safety Agency and 9-1-1 calls. Public Safety
Agencies (other than the County of Kern agencies), who call for
pr£vate ambulance companies (stand-by, etc.) which result in no
patient transport, can expect to .be billed by the ambulance
company. Since private ambulance companies are not required to
respond to hospital requests for transfers, hospitals can expect to
be billed or guarantee payment for patients that have no means of
payment for medical transportation. (Previous agreement paid the
ambulance providers for "County-responsible patient" transffers at
Medi-Cal rates). This will no longer be the case. KMC will pay
the ambulance providers only for those transfers that KMC directly
requests.
City police departments, who call for private ambulan6e companies
to transport an arrested individual prior to County booking, or a
5150, will be responsible for the transport.
These changes have happened over the past several weeks, and !
apologize that this information has not been formally provided to
you before now. There are still some unresolved issues, however,
this memo covers the most important issues as they are now known.
X will keep you informed as further information becomes available.
If you have any questions or if I can assist you in any way, please
call.
FAD:kb/AMBSVC8.93
cc: County Administrative Office County Counsel
Kern Medical Center
Kern County Health Department
KE H COUB TY EHT L HEI .!.TH ~$OCllkTIlON
September 15~ 1993
City of Bakersfield
Planning Department
1501 Truxtun Avenue
Bakersfield? Ca. 93301
Dear Mr Hardisty
This letter is to inform you that we found that our sign on the
Mental Wellness Center located at 1807 19th Street did not
conform to proper code. We have ~as of this date painted over the
sign. The final coat of paint will be in place on tomorrow.
We are sorry for any inconvenience ~this may have caused your
Department, and wish to assure ~you that at such a time that'a
sign is reinstalled it will be done properly with permit.
I trust that this meets with your satisfaction.
Jessie Mc Griff
Executive Director, KCMHA
cc: fi le
Allen Tandy
Patricia DeMond
Mayor Price
MANAGER.~ DBA
t6 SEP 95 ~ lq
1807 19TH STREET. BAKERSFIELD, CALIFORNIA 93301 · (805) 322-0365
COUNTY tIENT £ i"iE LTH :%OCikT ON
September 16, 1993
Downtown Business Association
1501 19th Street
Bakersfield~ Ca. 93301
At--~-~-~--~ Ca'thy Butler
Dear Ms Butler,
This letter will serve to confirm my statement to you that we
have retained Pinkerton Security and Investigative Services to
place an Officer on our property at the Mental Wellness Center
located at 1807 19th Street. The Officer wil~l be on duty during
the hours of 9:00 a.m. to 5:00 p.m. Monday through Friday.
We trust that our action will serve to reassure anyone that has
perceived a threat from any one that does come to the Mental
Wellness Center.
We look forward to receiving the~ material I have requested in my
earlier correspondence at your earliest convenience.
Sincerely
Jessie Mc Griff
Executive Director, KCMHA
cc: file
City Manager
Mayor
Chief of Police
Ms DeMond
1807 19TH STREET · BAKERSFIELD, CALIFORNIA 93301 ° (805) 322-0365
[] SACRAMENTO OFFICE :. ~. ,?:~,
. STATE CAPITOL ~ ~ _
~ OISTRICT OFFICE .~' -, ·.
RO0~ 2220
SAN FRANCISCO. CALIFORNIA 941 O2
(415) 557~784 '
~ DISTRICT OFFICE ?*;~ ~ ~ ·; ; ' : .... ~
~sou..s.,,.~s...~. ' ':~:::,W CLIE' ~EW BROWN,`
(213) 62~4356 ASSEMBEyMAN. THIRTEENTH DISTRICT
SPEAKER OF ~HE ASSEMBLY
Sep~e~e: 17~ 1993
Mr. Alan Tandy
City of Bakersfield
1501Truxtun Avenue
Bakersfield, CA 93301
Dear Alan:
Thank you for your letter regarding W0~ke~s' compensation reform
in California. I apologize for the delayed response.
When business professionals from around the state spoke to me at
the Economic Summit in Los Angeles last February, their message was
clear: workers' compensation reform is necessary before the state's
economy will turn around.
Now the debate on workers' compensation has come to an historic
end. The California Legislature-has passed a package or'reform
measures which will stimulate the state economy and encourage
business~reinvestment. I have enclosed a summary which reviews the
details of each of the pieces of legislation.
The savings to California's business community are expected to top
$3 billion dollars over the next three years. A rate reduction of
at least seven percent in workers' compensation insurance rates is
predicted within the next two years. The reforms have received
endorsements from the state's top business and labor leaders.
These changes will keep California competitive and allow companies
to stay and thrive in our state.
---ou~'~t-a-t~-~o~kers"'~o~p'e~Satib~ ~efo'rm pa~K~g~ is ~n ~i~hstrat~ion
of commitment by the Democratic Legislative leadership to work in
a bipartisan spirit to return California to its rightful place as
a prosperous place to conduct business -- a place where men and
women in both management and labor positions will profit.
I am encouraged by your concern for the well-being of
California's business climate. It is industry professionals like
yourself that make this state, and our nation, a truly great
place.
Sin~.rely,,~_~
Speaker of the Assembly
WLB:pmc:emg
Print~ on Rec~l~ Pa~r
THE WORKERS' COMPENSATION
CONFERENCE REPORT CONTAINED IN
Ai3 110, AB 119, A'B i300, SB 30,
SB 983, SB 484, AND SB 1005 DOES
THE FOLLOWING:
AB 1 ! 9:. PS¥CHIA~I~IC ~,ND,-Po~qT-~ER~!N'^T!ON c,.~,.IMS.-Rest~.cts-*thecom?ens~bility of psyohi.-
atric and post-termination claims, including:
· Requiring a higher (predominant) causation standard fo~ psychiatric claims;
· Providing an exempti'on to the predominant standard for victims or witnesses of violence;
these injuries are compensable if substantially caused (35% to 40%) by the workplace.
· Disallowing claims filed after notice of termination unless the employee had demonstrated
existence of the injury prior to the termination notice. Psychiatric claims so filed would also
be compensable if caused by sudden and extraordinary events.
AB 110:
· SELF'REFERRAL PROHIBITIONS. Prohibits physicians, insurers and vocational rehabilitation
counselors from referring injured workers to facilities in which the practitioner has a financial
interest.
· VOCATIONAL REHABlUTATION. Limits injured workers to one vocational rehabilitation plan
with an overall cap of $16,000 and an internal cap of $4,500 on counselor fees; removes the
requirement for a 90-day meeting between the injured worker and a rehabilitation counselor;
...... li~it~-ri~ir/tenanc'e all~wa~ paym~ntg~o-52~;e~ks;-provide-s ~hat plans agreed' upon between
an employer and a represented employee do not need rehabilitation unit approval; and elimi-
nates the requirement for vocational rehabilitation for employers who provide alternative or
modified work.
· MEDICAL'LEGAL I='VALUATIONS. Provides that no medical-legal evaluations may be obtained
prior to 60 days after the employer is notified of the claim; provides that the treating physi-
cian shall perform the medical-legal report; provides in disputed cases that an employee or
employer may obtain only one additional medical-legal reporti provides for a presumption of
correctness to attach to the treating physician's report; and provides that for permanent
disability ratings, the referee or appeals board shall be limited to approving the rating proposed
by one side or the other.
A SUMMARY OF THE WORKERS' COMPENSATION C: o N FE R E I~ G E REPORT
AB I 10 (CONTINUED)
· MAUAG£D CAn't. Allows employers to control the health care of injured workers for 90 days
if the employer offers no non-occupational health care but more than one managed care
organization (MCO) for workers' compensation health care, 180 days if the employer offers
non-occupational health care and more than one MCO, or 365 days if, in addition, the
employee's personal physician or personal chiropractor is participating in at least one of the
health organizations attending to the employee for occupational health care; provides certifi-
cation requirements for workers' compensation managed care organizations; requires that the
injured worker have access to chiropractic services; and retains current law provisions guaran-
teeing injured workers the right to predesignation of a personal physician and one change of
physician on request. ' '
· MEmC^~. TRE^TMENT FEE $C.EDU~-E. Requires the Administrative Director to revise the
treatment fee schedule by January 1, 1995 and the schedule for health care facilities, prescrip-
tion drugs and pharmacy services by January 1, 1996.
· £MP~.OVEn R,G.TS. Requires the employer to notify the insurer of information tending to
disprove claims, and requires the insurer to provide the employer with certain information
including offers to settle claims, and the amount and justification of reserves.
· DATA COL. I.E:CTION AND OYE!RSI(~HT. Requires the Administrative Director in consultation
with the Insurance Commissioner and the Rating Bureau to develop a workers' compensation
information system.
· B£N£F,TS. Provides for $747 million in benefit increases to injured workers divided approxi-
mately evenly between temporary disability and p~rmanent disability benefits. These benefits
would be phased in at $356 million on July 1, 1994, $198 million on July 1, 1995, and
$193 million on July 1, 1996. The existing maximum temporary disability award will be
increased from the current $336 per week to $406 in 1994, $448 in 1995 and $490 in
1996.
AB 1300: FRAUD.
· Provides that any person who offers to a workers' compensation adjuster or any adjuster who
accepts specified considerations as compensation, inducement, or reward for the referral or
settlement of any claim, is guilty of a felony.
· Authorizes the Attorney General, local district attorney or interested persons to bring a civil
action for the crime of employing runners, cappers, steerers, or other persons to procure
clients to obtain workers' compensation benefits. Imposes civil penalties, and provides awards
for specified actions brought by individuals related to workers' compensation fraud.
· Provides that half of the fees recovered from an attorney or law firm related to use of a runner
or capper shall be allocated to the Attorney General or the local prosecuting district attorneY
for investigatio, n and prosecution of workers' compensation fraud and half to the existing
Workers' Compensation Fraud Account in the Insurance Fund.
· ( A S U N M A RY OF THE WORKERS' COMPENSATION CONFERENCE REPORT
AB 1300 (CONTINUED)
· Requires that an individual or organization advertising legal services for workers' compensa-
tion benefits include the n~me of at least one attorney associated with the individual or
organization in the advertising, and provides that violation is a misdemeanor.
· Provides that any contract for professional services obtained by a clinic, laboratory, or health
care provider under fraudulent circumstances is void, and any fees collected pursuant to the
void contract are recoverable as additional civil penalties. Half of the penalties would be
allocated to the Attorney General or local prosecuting attorney and half would be paid into
the Workers' Compensation Fraud Account in the Insurance Fund.
~ · Prohibits persons convicted of workers' compensation fraud from collecting benefits associ-
ated with a fraudulent claim.
· Prohibits a health care provider from performing a medical evaluation unless the provider is
certified as a qualified medical evaluator.
SB 30: INSURANCE, Replaces the current minimum rate law with a competitive file and use rating
system using advisory loss costs and requiring a uniform plan for data collection purposes. Rates
may be disapproved by the Insurance Commissioner if they threaten the solvency of the insurer or
tend to create a monopoly. Provides for a seven percent reduction in workers' compensation insur-
ance rates.
SB 983: ALTERNATIVE SYSTEMS. Permits employers and employees in the construction industry
to agree through collective bargaining to an alternative workers' compensation program so l?ng as
the alternative program does not diminish the~entitlement of an employee to compensation.
SB 1005: CREATION OF COMMISSION AND OFFICES. Eliminates the current Health and Safety
Commission and replaces it with the Commission on Health and Safety and Workers' Compensa-
tion composed of eight members, four from organized labor and four representing employers. The
responsibilities of the Commission are:
~ ~- £L
· ~ -~o-con,,uct-an .ongo~ng-cxarn~naaon-o,-t,c-veorkc:-s-compensaaon sy=tem-*~nd ~he-=ta~e.s
iniury prevention activities; and
· to continue to approve applications for injury and illness prevention programs.
SB 484: APPROPRIATIONS. Makes appropriations to fund the implementation of new workers'
compensation laws.
SB 31: WORKERS' COMPENSATION.
While not a part of the Conference Report, the legislation
passed March 29, 1993 will:
· Mandate a new and more restrictive fee schedule for medical-legal evaluations.
· Establish a more restrictive definition of what constitutes a compensable medical legal
evaluation.
EOURCES: ASSEMBLYHENBER STEVE PEACE'$ OFFICE~ AND ASSEMBLY FINANCE, INSURANGE~ AND~ PUBLIC INVESTMENT COMHI~EE
UPDATED ~1~3
The League of California Cities
Sept. 17, 1993 · No. 1
Sales Tax EXtension Vote
League aews-:
I
_. u,..,, k,, letter Focuses on I! O? November Ballot
One of the measures on the November ballot is Proposition 172, which
This
"Election
Alert"
newsletter
will be issued regularly until extends the half-cent sales tax for cities and counties to use for public
thc November election. It will safety. The revenue from the statewide half-cent sales tax will be
focus on ballot measures and allocated to counties based on each county's proportionate share of
specifically evaluate the impact statewide taxable sales. Each county is required to deposit the rev-
on cities of these measures, entie in a Public Safety Augmentation Fund to be allocated bY the
! county auditor to the county and cities within the county.
Of particular interest to city
officials will be issues relative ! The allocation to the county and each city within the county is based
to Proposition 172, the pro- _1 ·
posal to extend the half-cent ' on a complex formula which takes into consideration the' net property
sales tax for use by counties ! ! tax loss for an individual city in proportion to the net property tax loss
and cities for public safety. ! for the county and all cities in the county, as well as other issues. (See
' the League's "Legislative Bulletin" of July 2, 1993, #23-1993 for a full.
City officials may wish to keep ~ explanation).
in mind that although public
entities may go on record in~
City revenues from the sales tax extension are limited to half of a
support of or opposition to I CitY's net 1993'/94 net property tax loss. [Note: in eight counties, the
ballot measures, public re-
sources cannot be used to total sales tax received by all cities within the county may not exceed
attempt to influence voters I 5 percent of total county sales tax revenues. The eight counties are
regarding ~aeasnre~-ilia~t haVe Fresno, Kings~ Merced, San Bernardi.no, San Diego, San Joaquin,
qualified for a ballot. I Solano and Yolo. In Alameda County, the share for the cities is
limited to 6.1 percent.]
- editor
, Revenues from the one-half cent sales tax already enacted and effec-,
tire through December 31. will be allocated in the same manner as for
Ploase Distribute This the sales tax authorized by Prop..172. The total revenues for cities
Alert,.To: from the first full year of the sales tax -- should it pass -- is estimated
· at $93 million. Payments from the Public Safety Augmentation Fund
will be made monthly to counties. There's no specific language stating
/ ~ouncil Members
~a~Department Heads when counties must pay cities.
/ Administrative The sales tax revenues are earmarked for public safety. See the next
Sta~ edition of "Election Alert" for more information.
~ 1 ~
League of California Cities Election Alert 916/444-5790
Proposition 174 On November Ballot League Board
Voucher Initiative PositiOn on Sales
known as the "Voucher Initiative"), would amend the California
Constitution to empower parents to choose a child's school. Sev-
eral clements go ,into effect should it pass:. Citing the need for cities to support
counties, as well as the fact that cities
· will receive a portion of the income, the
· Requires the State to provide a scholarship for every League's Board of Directors voted to
school-age child equal to at least 50 percent of the prior year's
per-pupil State and local government spending level for supportProposition 172, the extension
kindergarten through 12th grade. The scholarship may be of the half-cent sales tax. The League
redeemed at public or private schools, under specific condi- will also work on developing a long-term
reorganization process to assure account-
tions, ability and long-term reform.
-- --~--Re--~-~h.es~th.e-I~egisl. ature.to~esta~lish~procedures, for.pu.bl.i~c~
schools to become independent scholarship:redeeming schools. The resolution reads as follows:
· Authorizes required academic testing. Whereas, the Board of Directors
· Limits new regulatiOn of private and scholarship-redeem- of the League of California Cities sup-
ing public schools. ScholarShip expenses and specific savings ports the need to continue an adequate
count toward eduCation's existing COnStitutional minimum level of public safety to maintain the
funding guarantee, highest quality of life for oUr residents;
and
Whereas, all local services are at
The Legislative Analyst and Director of'Finance are uncertain of risk due to the fiscal crisis facing each
the fiscal impact, however, two primary impacts are anticipated.
The provisions related to scholarships, open enrollment and level of government in California; and
'testing could result in State costs potentially in excess of $1 Whereas, city support of the
billion. School districts could incur costs due to the open enroll- fiscal' health of counties is critical in
ment and testing provisions potentially in excess of tens of mil- order to ensure that local government
lions of dollars, according to State officials, continues to provide the services which
benefit all Californians; and
Whereas, it is critical for the
Passage of the sales tax continuation that
local government officials, the business
TJ e_idfLatiy_e.c ontains broad lang,uage~which ~communi~y~_comm,,ni~.Y organizations _
may limit local land use authority, and all of our citizens join together to
support this proposal; and
Whereas, both short- and long-
term solutions are necessary to allow for
the reform of State and local govern-
The League Board of Directors voted to oppose Proposition 174 at
merit governance and financing;
its most recent meeting. The main reason:for the Board of Direc- Now.Be It Therefore Resolved
tots' opposition to the measure is the language which may limit
that the Board of Directors of the
local land use and police authority over private schools.
League of California Cities supports the
extension of the half-cent sales tax and
The Board also 'felt that the initiative undermines the concept of commits to provide the necessary leader-
public education for public good by subsidizing private schools ship to bring about long-term fiscal and
and it could favor wealthy Californians because the average cost governance reform to ensure a healthy
of private school exceeds the average scholarship amount, and prosperous California.
League of California Cities Election Alert 916/444-5790