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HomeMy WebLinkAbout12/08/1997 BAKERSFIELD Randy Rowles, Chair Irma Carson Kevin McDermott Staff: Dolores Teubner AGENDA BUDGET AND FINANCE COMMITTEE Monday, December 8, 1997 12:15 p.m. City Manager's Conference Room Second Floor - City Hall, Suite 201 1501 Truxtun Avenue Bakersfield, CA 1. ROLL CALL 2. APPROVAL OF SEPTEMBER 23, 1997 SPECIAL MEETING MINUTES 3. PRESENTATIONS 4. PUBLIC STATEMENTS 5. DEFERRED BUSINESS A. COST RECOVERY SYSTEM - Teubner B. ESTABLISHMENT OF NEW REDEVELOPMENT AREAS - Wager 6. NEW BUSINESS A. 1998 PROPOSED MEETING CALENDAR - Haynes 7. · ADJOURNMENT DBT:jp FILE COPY DRAFT BAKERSFIELD Randy Rowles, Chair sA~.,r~ o~llloY,reCsJ~. I~nu Irma Carson Kevin McDermott AGENDA SUMMARY REPORT SPECIAL YEETING BUDGET AND FINANCE COMMITTEE Tuesday, September 23, 1~)97 12:15 p.m. City Manager's Conference Room 1. ROLL CALL Call to Order at 12:25 p.m. Present: Councilmembers: Irma Carson and Kevin McDermott Absent: Councilmember Randy Rowles, Chair 2.APPROVAL OF THE AUGUST 11, 1997 MINUTES Approved as submitted. 3.PRESENTATIONS None 4.PUBLIC STATEMENTS None 5.DEFERRED BUSINESS None 6.NEW BUSINESS A. ROSEWOOD RETIREMENT FACILITY REFINANCING The City Attorney gave a brief overview of the request from American Baptist Homes of the West (ABHOW) for assJstance in the refinancing of their locally -AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE DRAFT Tuesday, September 23, 1997 Page -2- owned facility, Rosewood. The refinancing will be accomplished with a loan from the Association of Bay Area Governments (ABAG) Finance Authority which intends to issue certificates of participation and will use the proceeds for eight ABHOW facilities including Rosewood. Federal tax law requires the City hold a public hearing and adopt a resolution before the COPs can be issued. The Committee was concerned about the requirement that we join ABAG as an associate member. Staff indicated that as an associate member of the ABAG Financing Authority we pay no fees, have no responsibilities or rights and assume no liability. The Committee also asked if ABHOW would be charged the standard fee of 2/10 of 1% or $10,000 whichever is more. Staff indicated that they would be paying the fee to cover the City's costs for involvement. The Committee unanimously recommended the item to the Council for approval with Committee Chair Randy Rowles absent. B. CLINICA SIERRA VISTA PROJECT The previously approved CDBG project for a proposed Clinica Sierra Vista facility located on California Avenue has undergone some changes due to newly identified medical service needs in the area. Staff reported that the original project provided funding for a facility housing several social service functions and outreach programs. However, the area has recently been identified as a medically underserved area and Clinica Sierra Vista would like to change the focus to an urgent care facility with contracts with Medicaid and insurance providers for after-hour care and emergency services. The Committee asked questions about the impact of the facility on the service area, the other Clinica facilities and on pdvate healthcare providers. Clinica representatives indicated that the area is in need of such a facility and that it will work in cooperation with private providers to provide urgent care facilities for their members in that area. The facility will differ from Clinica's other facilities because it will not provide chronic care and scheduled visits. Currently the area is not served by an urgent care provider. HUD has no objection with the change in planned services for the project since both the original and proposed projects are health care facilities. The Committee unanimously recommended approval of the item to the City Council, with Committee Chair Randy Rowles absent. This item will be place on the October 8, 1997 Council agenda. 7. ADJOURNMENT The meeting was adjourned at 1:00 p.m. cc: Honorable Mayor and City Council DBT:jp BAKERSFIELD CITY MANAGER'S OFFICE MEMORANDUM DECEMBER 2, 1997 TO: BUDGET AND FINANCE COMMITTEE FROM:~~DOLORES TEUBNER, ASSISTANT CITY MANAGER SUBJECT: COST RECOVERY STREAMLINING PROPOSAL As you are aware, a committee of business manager's and myself, have been working on a proposal for streamlining the current, highly cumbersome, fee calculation process. A working draft was distributed approximately two months ago and based on input from department heads and committee members, we have refined the proposal into final form. The proposed cost recovery system has been tested on FY 95-96 fee data to insure that the level of recovery would not increase or decrease significantly. The test resulted in approximately the same level of recovery, but did result in significantly less time spent by Finance to prepare the overhead data, by departments to calculate the fees and by Finance and the City Manager's office to review the proposed fees. Under the proposed system the basic fee calculation process would operate as follows. A fee would be comprised of four elements: direct labor plus fringe benefit costs, direct operating costs, overhead and adjusting factors such as COLA, market sensitivities, etc. A fee would be calculated by adding together direct labor and fringe benefits and direct operating costs, applying the overhead rate and then adjusting the fee for the cost of living increase or any significant increases or decreases in the cost of service delivery. The fee process will move from an annual to a biannual cycle. This means that the above "formula" would be applied every other year in order to check assumptions for labor costs, materials usage, etc. In the off years, departments may simply increase the fee by the amount of the COLA for that year and make any necessary adjustments to operating costs to account for major price increases or decreases. Below is a comparison of the elements of the current cost recovery system with the elements of the proposed system, to demonstrate the areas in which we have streamlined. SADOLORE$\crproposal.825, wpd Current System Proposed System Results 11 different overhead rates 2 overhead rates Faster to - 1 City rate - 1 for safety departments calculate - 10 different department rates - 1 for non-safety departments 6 different fringe benefit rates 3 fringe benefit rates Easier to - Separate rate for each bargaining - Safety, non-safety and temp. rates calculate unit Fee calculation made up of 7 elements Fee calculation made up of 4 elements Faster to - Building Occupancy calculation - Direct Labor and fringe benefits calculate and (Lease, maintenance, utilities, misc.) - Direct Operating Costs easier to - Equipment Rental calculation - Overhead understand - Direct Labor - Adjusting factors - Fringe Benefit calculation (COLA, Market sensitive services, etc.) (6 rates based on bargaining units) - Direct Operating Costs - City Overhead Rate - Department Overhead Rate (10 rates) Calculation involved determining a Sum of labor costs and operating Faster to per labor hour cost for each dept. costs is multiplied by appropriate calculate and and applying the rate to building occ., overhead rate and adjustments are easier to equip, rental and direct operating costs applied (if needed), understand then multiplying the subtotal by the City overhead and dept. overhead rates. Overhead rate calculated by Finance Overhead calculated by Departments More buy-in based on pre-determined costs based on actual cost data from Depts. (City-wide portion of rate still calculated by Finance) Direct operating cost does not Direct operating costs include all costs Easier to include equipment rental, building attributable to a service (increases use calculate costs, instead those are separate of HTE project accounting system). calculations. Recovery rates specified in Recovery rates removed from ord. Greater ordinance, do not provide flexibilityand determined based on flexibility to respond to changing conditions, services and market conditions. Full calculation cycle conducted Fee review conducted bi-annually Time-savings annually, with COLA adjustment made in off- for dept's. years. S:~DOLORES\crproposal,g25.wpd Distribution of Marginal Property Tax Dollar $1.00 ~, ,.. ~o.~o i r $o 80 ~ ,,,,,~ ency Revenue $0.60 /~ ~il Housing Set-Aside $0.40 -?',/,,-- $o.2o 25% ~ass Through $0 20 ~' $o.2o $o oo · Year 5 Distribution of Marginal Property Tax Dollar $1 O0 ..... ~, " $0.43 $o.8o -~' ~, .~,..'" ency Revenue $0.60 .... ~.". ,o.2o ~ Housing Set-Aside ~ ,,,,~"~ 25% ~ass Through $0.40 ~'''',~,,,'" $o.2o I~ 21% Pass Throu§h $0.20 ...... $o.~? $o oo ' ¥oar 25 Distribution of Marginal Property Tax Dollar $1.00 --- ~ $0.80 ~ ~ Agency Revenue $0.60 i , ~ Housing Set-Aside 25% Pass Through $0.20 $0.40 21% Pass Through $0.~? 14% Pass Through $0.20 , ~/ $O.ll $0.00 I Year 35 December 8, 1997 TO: BUDGET AND FINANCE COMMITTEE FROM: STANLEY GRADY, PLANNING DIRECTOR SUBJECT: COMPARISON OF DEVELOPMENT PLANNING OPTIONS Planning was asked to present this at a previous meeting of the Budget & finance Committee. However do to time constraints the presentation was deferred to a later meeting. The following is a presentation in outline form a comparison of development planning options. ADVANTAGES AND DISADVANTAGES OF DEVELOPMENT UNDER A SPECIFIC PLAN ADVANTAGES DISADVANTAGES 1. Brings focuses to an area and gives it 1. Limits development options to a an identity as a special planning area. stated vision that requires a lengthy process to change. 2. Identifies specific development objectives unique to the planning 2. Standards must be different in order area. to give value to the plan and as a result are usually more restrictive. 3. Allows for permitted uses in a manner different than citywide zone 3. Less effective for a built districts, environment unless coupled with the resources to redevelop the built 4. Establishes a capital improvement environment. program different from citywide program. 4. May require changes to general plan policies to provide for approvals that 5. Provides more flexible development may not be consistent with current standards allowing for a greater plan policies. variety of development options without requiring additional 5. It isn't a resource allocation " approval, document in the sense that what is between the covers of the plan does 6. Provides the basis for allocating not provide the means to achieve the resources that may become available plans goal. for projects in the future. DEVELOPMENT PLANNING OPTIONS SUBJECT TO THE GENERAL PLAN The following plan documents are subordinate to the general plan. Proposed development projects under either option must be consistent with the general plan. Viewed as tools, they require viable projects in order to achieve the goals and objectives of the plan. Specific Plan Redevelopment Plan Strategic Plan (a) A specific plan shall Every redevelopment plan Sets direction, Allocates include a text and a shall show by diagram and resources, and examines diagram or diagrams Which in general terms: alternative courses of specify all of the following action in detail: (a) The approximate amount of open space to be Where are we today? (1) The distribution, provided and street layout. location, and extent of the Situation analysis external, uses of land, including (b) Limitations on type, internal, and competitive open space, within the area size, height, number, and variables covered by the plan. proposed use of buildings. Where are we going? (2) The proposed © The approximate distribution, location, and number of dwelling units. Mission statement, long extent and intensity of term objectives, major components of (d) The property to be measurable goals public and private devoted to public purposes transportation, sewage, and the nature of such How do we get there? water, drainage, solid purposes. waste disposal, energy, and Strategy formulation other essential facilities A preliminary plan need proposed to be located not be detailed and is within the area covered by sufficient if it: the plan and needed to support the land uses (a) Describes the described in the plan. boundaries of the project area. (3) Standards and criteria by which development will (b) Contains a general proceed, and standards for statement of the land uses, the conservation, layout of principal streets, development, and population densities and utilization of natural building intensities, and resources, where standards proposed as the applicable, basis for the redevelopment of the (4) A program of project area. implementation measures including regulations, © Shows how the purposes programs, public works of this pan would be projects, and financing attained by measures necessary to redevelopment. carry out paragraphs (1), (2), and (3). (d) Shows that the proposed redevelopment is (b) The specific plan shall consistent with the include a statement of the community's general plan. relationship of the specific plan to the general plan. (e) Describes, generally, the impact of the project upon the area's residents and upon the surrounding neighborhood Redevelopment includes: (a) The alteration, improvement, modernization, reconstruction, or rehabilitation, or any combination of these, of existing structures in a project area. (b) Provision for open-space types of use, such as streets and other public grounds and space around buildings, and public or private buildings, structures and .. improvements, and improvements of public or private recreation areas and other public grounds. © The replanning or redesign or original development of undeveloped areas as to which either of the following conditions exist. (1) The areas are stagnant or improperly utilized because of defective or inadequate street layout, faulty lot layout in relation to size, shape, accessibility, or usefulness, or for other causes. (2) The areas require replanning and land assembly for reclamation or development in the interest of the general welfare because of widely scattered ownership, tax delinquency, or other reasons. Chapter 3.70 COST RECOVERY SYSTEM ~' AKII~ C~e'D%II~"~I~ /'~UAD/'~_~' D~%le-kll I~'- ,/ ~ Sections: 3.70.010 Intent. 3.70.020 Delegation of authority. 3.70.030 Definitions. 3.70.040 Schedule of fees and charges. 3.70.050 Procedure for setting fees. .. 3.70.060 Provision of data. 3.70.070 Appeal. 3.70.010 Intent. A. Pursuant to Article XIIIB of the California Constitution, it is the intent of the city council to require the ascertainment and recovery of costs reasonably borne from fees and charges levied therefor in providing the regulation, products or services hereinafter enu,,-;erat~d :- ,,, L,,,o ch~,pte, set by City Council resolution. B. The ' .... -' .... :-- -~ .... ~.u, ,,~,o, ,ou,', cost recovery system set forth in this chapter provides a mechanism for ensuring that fees adopted by the city for services rendered do not exceed the reasonable estimated cost for providing the services for which the fees are charged. (Ord. 3359 § 1 (part), 1991). 3.70.020 Delegation of authority. A. The city manager is hereby delegated authority to issue executive orders defining terms, setting out administrative fee collection and financial procedures, definitions, establishing effective dates of all fees set by the city council by resolution, and establishing charges for water, sewer and ~ refuse services. All executive orders shall be originated and signed by the affected department head, shall be signed by the finance director certifying that the financial requirements of this chapter are complied with, and shall be signed by the city manager designating the effective date of the executive order. B. All executive orders shall be consistent with the schedules of fees and rates as set by the city council by resolution. (Ord. 3359 § 1 (part), 1991). 3.70.030 Definitions. A. "Costs reasonably borne," as used in this chapter s,hal: may consist of the following elements: ~Editor's Note: Previous ordinancescodified hereininclude portions of Ordinance Nos. 3337.3228.3170.3088. . and ~052. ~- 1. All applicable direct costs including, but not limited to, salaries, wages, overtime, employee fringe benefits, services and supplies, maintenance and operation expenses, contracted services, special supplies, and any other direct expense incurred. 2. All applicable indirect costs including, but not limited to, building maintenance and operations, equipment maintenance and operations, communications expenses, computer costs, printing and reproduction, vehicle expense, insurance, debt service and like expenses when distributed on an accounted and documented rational proration system. 3. Fixed asset recovery expenses, consisting of depreciation of fixed assets, and additional fixed asset expense recovery charges calculated on the current estimated cost of replacement, divided by the approximate life expectancy of the fixed asset. ' -'~' - ::--- : ......,--,- ..... ,---, .... ,... JUl LB IT;;! Ci~ItJIU~.~i ICal L~,7 LI i~;~ Ulilt;~l ~;;I I~7 u~;;Lvv~;;~;~l I uu~,;[% VCilut::; ~J~;~JI T;~.~ICII, IUI I IIUL ~*,~1 T;;;;VIUICIOI~' I ~;~UV~;;;I T;;;M 4;31 IM I T;~OT~I V~;;M II I T~Clel ICil I~J I,I I~;~ IMII ~,,~IkTOI, T,.Ti ~ ,- 4. ~ Administrative overhead, expressed as a single percentage, distributing and charging the expenses of the mayor and city council, city attorney office, city administration, city clerk office, clt¥ ~re~surer, ec~n~mlc management information services, finance department, personnel office, and all otoff o, ,d o,,~,.,,-~ o~, ~,,.~ ~,, ~,~,.~,, ~,~ ~, ,~ ~, .,, ~ ,.,~y ~r.~.n;z~t;~,, departmental operating expenses. Overhead shall be apportioned l~"Orate~between tax-~ supported services and fee-firr~u"~ supported services ~n :he boo,o ¢~f oo,~, percen~.g~ so that each of taxes and fees and charges shall proportionately defray such overhead costs. ' -' :-" ' ph 3.--'" ' · ~,,-,,,~, o,~,. ,,, o..,~o~,.,,,,,, ,-,., p~.r~.,~r~, s ,., ~_., o,,~, ~,. ~f ~his s~c~n. ' -~-" ~ .... : --- 'f ~nant wth;n any d ' ' dt ppi:, B. "Fees" means all charges for ci~ se~ices as set fo~h :- by Ci~ Council resolution, but does not include rates or charges for the following ente~rise sewi~s: water, sewer, ~ refuse, aimo~ and off-street parking ~. (Ord. 3359 ~ ~ (pa~), ~99~). C. "Tax-suppoSed" se~ices means ail se~ices financed with general fund monies. D. "Fee-suppoSed" se~ices means all se~ices fiflanced by charging a fee for se~ice. 3.70.040 Schedule of fees and charges. A. Each city department head, under the direction of the city manager, and review of the finance director, shall annually-update review the '-",,-,,,,~-,,:--,u '---,~:o and o~, v0~.~ ch~.r~3a o,., ,~,~.,,a Master Fee Schedule, and biennially conduct a comprehensive audit of the fee schedule for the consideration of the city council so as to recover ,,,~ ,,o,~,~ percent;--,.3e or cost reasonably borne necessary to provide the ~ regulation, product or servicer.. Service Percentage of costs reasonably borne Center Regulation, Products or Service to be recovered COMMUNITY DEVELOPMENT SERVICES /o ~ Condltlonal Sign Perm;[ `4,,~, o, S- 10 =-- -" ....... · , ,-,-- -, .... ~ "'-~ :-- ~ ~' '" .... , ~.0 B-12 ~-~"" ~ ~- · B-14 ~-~ Ch ~'"'~" % % Percentage of costs Service reasonably borne Center Regulation, Products or Service to be recovered % % IU, I I II,.~i, UI I~.~ I,~l,,.,~l.I I~.~l. I \~;;;Vlg;$v~ ,,I t'~t'~lVV,O % I 8 2 '"' "' .... ' '~ ........ '"---: .... ~,-,,-, ,-, % S-I 8.3 ~-'~-~':':'-':-- ' % ~ "' ..... 'PI Am % % % ~-~1 , __4 r~:..:_:__ ~_..: .... % S-23 '" ....~ ' ........... ~'-- ~--'-:- S-24 ~' '~':- · % % S-27 ~'---' ~..' , ...... :-- % Percentage of costs Service reasonably borne Center Regulation, Products or Service to be recovered r~l 11111 I/'~ % 32 ~ ' % S 33 '"~-'~ .... '--~ ~---: .... % % % % % % ~ ~ , % ~ Fingerprint~=,~--~,~e-:- ", ~.0 % ~-~ ~-~--' ~ .... :--~u=,~ .... u~ G ' , u~.0 ~-~4 ' ~"~ ' ' '~'~' ~" ~'~' "~, ~0.0 Percentage of costs Service reasonably borne Center Regulation, Products or Service to be recovered % % % % IIg ~l~ry 1%~VI~VVIII IO~ggJlgl I ~ ~ %- % % % UIIUgI~IUUII~ ~LUI~g I QII~ I glllllt % % ~ P--" "--:':"' ~ .... ' , ~.0 % % % serVice Percentage of costs reasonably borne Center Regulation, Products or Service to be recovered o ~- ,-.;... ^ -,..,. o_,.L_,, Pr g Il'~---- I- :__.J...;,L -- -- .;____ ~%..~/IIIL,/III~J ¥¥1LII ~,J~;I ¥1~.~;~ %.~11[~1 - c 59 '-"---~-":.-,-' ,,-- -- U[I ICl UZ'~llllglM I./OW ~J. ~./ '"-- ~ :-- -' "':'~ °--':--" -- · -- s54) · -,,~y. , uu~,, Programs o,,d ,-,,.~,v,.eo ^ -':":': · % % ~ . . . ~-~3 Recreatio~a: Sw;mming Aquatic Programs and Charga~- S-~7 Summer ~, ~ ~,,~, y Rental ~=~=, o,,~,~ ~y,,,~, ,~, ,y Cuppo, t S-70 Convent[on ~--'-- -:- ~,,~, M=,,,tananca and Service Percentage of costs reasonably borne Center Regulation, Products or Service to be recovered ~'~ '"-' ' ~'~""~°"" ~°~' '"~'~'"~ 100 0 % "'~O 0 ~,~] ~7-1~, /--t~II~.~UlLUlC~I VVCIL~;;1%.7~:1¥1bC I~ . % k~/ ~-, ~ ~GnJ~ry ~vv~, ~r~Ice I O0.O % % '~' .............. :~ Ag % % ~ Camm~rclal R~fuse Oervlce 100.0 % (Cambbed '-':" ---:-- v,,,,, s~, v,~ ~ ..... s-78) % S-83 Drainage M~bten~nce I00.0 % Service Percentage of costs reasonably borne Center Regulation, Products or Service to be recovered ~ ,'Taxed ""--':--' - ,v,~u,o,, Maintenance and Operatio,, IOC.O % %  I I ..... L.~.J ~L.~& · % LtL .i. ~ Ceologlcal Survey ,.,~ree~ U~ 1,30.0  )~----.:?~ ^11_.. · % ~ Taxed "-:-'-~---~----' ,~--,- -:- ',~,~,,,-,,-,,,,,-,,~,.,, o,,, ,Mo,,,tenance and I,~, ~/~/. 0 I IC;illl~,.~ IVIC;II~III~ i'~;;T~.~U~;;;OL I ~.C;;;VI~:;VV 4~,/'~ ~'~ % % ........ Garage ~arkb~ -,,.,.0 (Combln~d ;;'it,h Servlce Center S-70) % I,~e~ ,way ,.,. % ~ Document '"-:-': .... -~ '" .... : , ~,0,0 % Age "'"' 0 % Service Percentage of costs reasonably borne Center Regulation, Products or Service to be recovered 8-I01 ~'---'- "'-,,---: % G-102 Raquest '-- '"' "-':- "-" ' "'-',,'-, ~acordo 4n~ ,', I % S 103 '" '- ---' ,"' -,,: · % -S..--t.-e4 "----'-'"':-'"- "'-:':-- , ,.,,.,.0 % % ~ .,,.,~ ,-, ...... :__ o_,..__, ,-__:,:,:__ ,-__ ,., '"- '"'"" ' '"'""~°°"'~ "'"""-'"" ' °'"'"""~° ' '='=o I,.,0.0 % o~, ,,,,..~ ca,'~tars hr-.va bea,'~ -'-'-'--' frO,T, "-: .......... ' IIAI;~M I,C~O ~GL IJy ~.,/ Th~sa .... : ......... by' '~-,/ Th~o~ ....: .... B. The approved services ,:,o ,,~,., in ,,,,o SaC~iO,-I shall be as defined in '-'~°"' '~ ........... :"--' ""'--' Gy ,,,~,-.",,,~, ,~ ~,,..~,., ,-,,.,o~ Con~FoI s~a,'~ for ~,~a "': .... = '~-' .... =-'-'" -'-,--' ,, --:, "-', ' ~'~'.', oo v,,-,,.,"~.~,., by ,M~'.n~.ga,T,~n~ C~,,,,,.~o '---: ...... _:___:_ _, __:__ ~ _ · ,;,,~t,.,,,- ~h~ ,-,o,,,,-,,,,,o, o,,,., by ,~, ,.,q ¢ouncit the Master Fee Schedule. C. The city manager may van/the review schedule listed in this section if, in the iudgment of the city manager, a gross inequity would result by not revising thc-rate fee schedule. Any such-r-at~revi$ion which deviates fi'om the review schedule as set herein shall be reported to the city council at its next succae,C,~a,~ meet",n~ within 90 days of its implementation. (Ord. 3669 § 1, 1995: Ord. 3546 § 1 1993: Ord. 3536 § 1 1993: Ord. 3359 § 1 (part), 1991). ' ' 3,70.050 Procedure for setting fees. A. Pursuant to California Government Code Sections 66016 and 66018, the city clerk shall cause notice to be provided as set forth in California Government Code Sections 66016, 66018 and 6062a, and the city council periodically shall receive at a regularly scheduled meeting oral and written presentations concerning fees as defined in Section 3.70.030, proposed to be increased or added. Such notice, oral and written presentation, and public meeting shall be provided prior to the city council taking any action on any new or increased fees. At least one such public hearing shall be held annually, in ,..,.,, ,j,~, ,,.t,,.,,, ~,,,, the ..... &r;riu&~ '-- ,-,~,~u~, process o,,d he,rings. B. Charges for water, sewer and etectric~ refuse service shall be set annually by executive order of the city manager. Such charges shall take effect ten days after the city manager signs an executive order. Each such order shall be posted at City Hall and a copy thereof shall be mailed to each person who has requested from the city clerk notice of the same in writing· Each such request shall be valid for the balance of the year in which it was made· Should an appeal be filed as provided in Section 3.70.070, the effective date of the charges specified in such appeal shall be stayed pending resolution of the appeal. (Ord. 3359 § 1 (part), 1991)· 3.70.060 Provision of data. Pursuant to the California Government Code, at least ten days prior to the required public hearing set out herein, the city manager shall make available to the public appropriate data indicating the cost, or estimated cost, required to support the fees and charges for which changes are proposed to be made, or which are proposed to be added. The city manager shall also provide a summary of the present fee and charge schedules and those proposed at such a~uat public hearing. A general explanation of the changes proposed shall also be published per the requirements of California Government Code Section 6062a. (Ord. 3359 § 1 (part), 1991). 3.70.070 Appeal. A. Should any person believe that any fee or charge set by the city manager or city council is in excess of the ~ costs reasonably borne, or that such fee has been improperly reviewed, then said person may, no later than five days after said fees are set by the city council, make written objection to the city council setting forth the grounds for dissatisfaction, whereupon the council shall hear said objections at a regular meeting no later than ~ 30 days following the filing of the objection with the city clerk. The appellant shall be given written notice no less than five days prior to said hearing. The council may, upon said hearing, sustain, suspend or overrule the decision setting the specified fee. · -. ,~,,v,.,,, o,,y ~,e,o~,,, ,,e,,e,e ,,,o, r. ny charge oe, by ,,,e ,.,,y ,-n~n~-.ger :,a i,, e-.,..eoo ,.,, the ........... ' ---'- bJy ~,~,,,,e, or thru ou~.h chr-rge ,,oo bee,, ,,,,~,,~,~,e, ,ev,e,,e~,, ",e,, oo,,~ ~e,o,.,,, m~.y, no lore, tho,, five d~ys .,., ,.,.,.,~,~, D., ,,,oke ;;'r;=en objection to the c;ty' ...... ;' o~,,,,,e fo~h the grounds '-- ' · · · ,~,, di~$r-.tisfr-.c, tion, '¥'¥'hei'eupon the ¢ounc.;J o, ,o,, ,.,~,je,..,~,,o .-., .. reguJr-;' n';eetJng ,,u ,,=,e, th~n three ..... "- '-" ....:-- ,,,,,,~ ~.ee,.o ,~,.,.,..,, '~1 the ~":-- - ObjeCtJOR "':"- ,,,,, the -:'-- -'--'- - ~.,,y ~.,e, ~. Th: ~'.ppell~nt -'--" '-- · · d~.ys ~,,,,~, ,~, oo,~ he~nng The ...... -" · ~uu, ,~,,, ,~c,y, upon --:~ ' oc,,u he,ring, - .... :- ~,v;,,~,,e ,,,e ~.,o,~,,, se~;ng ,,,e specJ,qed fee '"'-'~ ~'~ § 1) Budget and Finance Committee Meeting of December 8, 1997 BAKERSFIELD MEMORANDUM August 4, 1997 TO: Budget and Finance Committee FROM: Alan Tandy, City Manage . '"' ~ SUBJECT: Redevelopment Project Areas Unfortunately, I will be on vacation when the Budget and Finance Committee takes up the issue of additional redevelopment project areas, so I would like to pass on a few overview notes on that subject: I had originally been concerned that one or more of the project areas might have a declining tax base which would have, if that existed, made success of a project area very difficult. The study that was hired, however, showed modest growth. The kinds of "deals" that are possible with a project area would be similar to the one we just entered into with KGET. The growth in taxation for new construction and added tax base is given back to the developer at a 75%-25% level for several years. The inducement makes the project feasible and the "project area" incentives comparable to other competing cities. The "incentive" doesn't cost anything, because it is simply giving back a portion of new revenue for a limited period of time. If the incentive didn't exist, the new growth and new tax base wouldn't have come. For several years we have attempted to use the block grant and certain state programs as the incentive to spur development in the southeast. We have now added the enterprise zone. The addition of a redevelopment agency would help add to the package to spur job growth and revitalization. The concept of such a program stirs controversy due to some past downtown projects. Under our current elected body, I am confident that any past errors would not be repeated. AT:rs Single Project Area · Greatest Cost Savings Two Project Areas A) Parallel · 1 Year + Implementation · Economies of Scale · Cost Borne in Single Year · Limits on CDBG (Forgivable) · Use of Other Funds (Loan or Forgivable) B) Staggered · 2 Year + Implementation · Higher Cost · Cost Borne Over Two Years · Ability to Use More CDBG Funds (Forgivable) · Reduced Need for Other Funds (Loan or Forgivable) Redevelopment Plan Adoption Survey of Estimated Costs (without legal component) Average "Parallel" "Staggered" Cost by Firm Firm A $145,000 $155,000 Firm B $200,625 $250,000 Firm C $256,500 $317,500 Firm D $459,000 $526,000 Average Cost by Scenario I ?,:;~':$265,281 .:~-" i~,~'~$312,125 I "Parallel" Both project areas are adopted simultaneously. "Staggered" Second project is started once the first is near completion. 08/07/97 P:\CDDA\COSTMATR.WB2 Redevelopment Plan Adoption Survey of Legal Costs Only Average "Parallel" "Staqqered" Cost by Firm Firm A $13,000 $18,000 Firm B $51,000 $51,000 Firm C $60,000 $60,000 Firm D $70,000 $85,000 Average Cost by Scenario I ~ ~::ili::i:i~,~.:~$48,500 ~i~,~ .:::~ :.~$53,500 "Parallel" Both project areas are adopted simultaneously. 08/07/97 P:\CDDA\COSTMATR.WB2 Parallel Assumptions Used to Create Examples of Costs and Revenuex · Project Formation Proceeds in a Parallel Fashion · Consultant Cost - $200,625 (Range of Estimate from Four Firms - $145,000 to $389,000)* · Legal Assistance - $25,000** (Range of Estimate - $13,000 to $70,000)* · Revenue Based on 2% Growth/No Projects · Graph and Tables Use Collapsed Costs and Revenues Loan of $135,625 at 6% Interest ($225,625 - $90,000 of Available CDBG Funds)*** Forgiven Cost of $225,625 * Actual Cost Determined through Request for Proposal (RFP) ** On-Call Basis Only *** Limit on Use of CDBG Funds Based on 20% Cap of Annual CDBG Entitlement Combined Areas Operating Parallel- Loan $600,000 Available Tax Revenue Total Agency Expenses $400,000 Fund Balance $200,000 $0 ($200,000) ($400,000)~ ~ ~ ~ 1998 2000 2002 2004 2006 1999 2001 2003 2005 Estimated Operating Parallel - Loan 1998 1999 2000 2001 2002 2003 2004 2005 2006 Beginning Balance (1) 0 (135,625) (186,322) (238,033) (243,063) (197,687) (101,959) 54,445 274,100 Available Tax Revenue (2) 0 50,000. 102,000 155,000 209,000 260,000 318,000 375,000 433,000 Operating Expenses (3) 0 22,969 23,199 23,431 23,665 23,902 24,141 24,382 24,626 Personnel Expenses (4) 0 Principal Planner 0 69,590 71,330 73,113 74,941 76,814 78,351 79,918 81,516 Development Assoc. 0 0 48,004 49,204 50,434 51,695 52,987 54,312 55,670 Interest Expense (6%) (5) 0 8,138 11,179 14,282 14,584 11,861 6,118 (3,267)' 0 Total Agency Expenses 0 100,697 153,712 160,030 163,624 164,272 161,596 155,345 161,812 Fund Balance $0 ($186,322) ($238,033) ($243,063) ($197,687) ($101,959) $54,445 $274,100 $545,288 Assumptions 1. Beginning balance in FY 98-99 is the cost of parallel implementation of project areas less CDBG funds. 2. Revenues are assumed to grow by 2% each year. 3. Operating expenses are assumed to grow by 1% each year. 4. Personnel expenses are assumed to grow by 2.5% each year. 5. Interest expense is assumed to be 6%, which is the City's current investment return rate. 08/07/97 P:\CDDA\OPERPARL.WB2 Combined Areas Operating Parallel- Forgivable. 500,000 ~ Available Tax Revenue Total Agency Expenses 400,000 -] 300,000 200,000 100,000 0 I ~ ~ ~ I~ 1998 2000 2002 2004 2006 1999 2001 2003 2005 Estimated Operating Parallel - Forgivable 1998 1999 2000 2001 2002 2003 2004 2005 2006 Beginning Balance 0 0 (42,559) (83,091) (73,839) (13,879) 93,710 256,231 472,619 Available Tax Revenue (1) 0 50,000 102,000 155,000 209,000 260,000 318,000 375,000 433,000 Operating Expenses (2) 0 22,969 23,199 23,431 23,665 23,902 24,141 24,382 24,626 Personnel Expenses (3) 0 Principal Planner 0 69,590 71,330 73,113 74,941 76,814 78,351 79,918 81,516 Development Assoc. 0 0 48,004 49,204 50,434 51,695 52,987 54,312 55,670 Total Agency Expenses 0 92,559 142,532 145,748 149,040 152,411 155,479 158,612 161,812 Fund Balance $0 ($42,559) ($83,09'1) ($73,839) ($13,879) $93,7'10 $256,23'1 $472,619 $743,807 Assumptions 1. Revenues are assumed to grow by 2% each year. 2. Operating expenses are assumed to grow by 1% each year. 3. Personnel expenses are assumed to grow by 2.5% each year. Note: The estimated operating numbers for this scenario are identical to "Staggered-Forgiveable." 08/07/97 A:\OPERPARF.WB2 Staggered Assumption Used to Create Exatnples o_f Costs and Revenue · Project Formation Proceeds in a Staggered Fashion · Consultant Cost - $250,000 (Range of Estimate from Four Finns - $155,000 to $526,000)* · Legal Assistance - $25,000** (Range of Estimate - $18,000 to $85,000)* · Revenue Based on 2% Growth/No Projects · Graph and Tables Use Collapsed Costs and Revenues Loan of $135,625 at 6% Interest ($275,000 - $190,000 of Available CDBG Funds)*** Forgiven Cost of $275,000 * Actual Cost Determined through Request for Proposal (RFP) ** On-Call Basis Only *** Limit on Use of CDBG Funds Based on 20% Cap of Annual CDBG Entitlement Combined Areas Operating Staggered - Loan $800,000' Available Tax Revenue Total Agency Expenses $600,000 Fund Balance $400,000 $200,000 $0 ($20o,ooo)~ ~ ~ 1998 2000 20022004 2006 1999 2001 2003 2005 Estimated Operating Staggered - Loan 1998 1999 2000 2001 2002 2003 2004 2005 2006 Beginning Balance (1) 0 (85,625) (133,322) (181,853) (183,512) (134,563) (35,048) 125,371 349,281 Available Tax Revenue (2) 0 50,000 102,000 155,000 209,000 260,000 318,000 375,000 433,000 Operating Expenses (3) 0 22,969 23,199 23,431 23,665 23,902 24,141 24,382 24,626 Personnel Expenses (4) 0 Principal Planner 0 69,590 71,330 73,113 74,941 76,814 78,351 79,918 81,516 Development Assoc. 0 0 48,004 49,204 50,434 51,695 52,987 54,312 55,670 Interest Expense (6%) (5) 0 5,138 7,999 10,911 11,011 8,074 2,103 (7,522) 0 Total Agency Expenses 0 97,697 150,532 156,659 160,051 160,485 157,582 151,090 161,812 Fund Balance $0 ($'133,322)($181,853) ($'183,512)($134,563) ($35,048) $'i25,37'1 $349,281 $620,469 Assumptions 1. Beginning balance in FY 98-99 is the cost of staggered implementation of project areas less CDBG funds. 2. Revenues are assumed to grow by 2% each year. 3. Operating expenses are assumed to grow by 1% each year. 4. Personnel expenses are assumed to grow by 2.5% each year. 5. Interest expense is assumed to be 6%, which is the City's current investment return rate. 08/07/97 P:\CDDA\OPERSTGL.WB2 Single Parallel Staggered Loan Forgivable None of the Above Revenue and Pass Through Total Tax Revenue In Thousands Combined Project Areas $10,000 - ~ lYear 31 - 2nd Revision to Pass-Through $8,000 - $6,000 - ~-~Year 11 -lst Revision to Pass-Through $4,000 - ~ / $2,000 -~ · .. . ~', .... ". property Tax Base 0 5 10 1520 25 30 35 40 45 Year Combined Areas Combined Areas 2% Growth Scenario (000's Omitted) FY 98-99 Year 1 2 3 4 5 6 7 ' 8 9 10 11 12 Assessed Valuation 429,146 437,729 446,483 455,413 464,521 473,812 483,288 492,954 502,813 512,869 523,126 533,589 Year 11 Base (21% Pass Through 10,257 20,720 Year 31 Base (14% Pass Through Increment Assessed Valuation 8,414 16,997 25,752 34,681 43,790 53,080 62,556 72,222 82,081 92,137 102,395 112,857 Property Tax Revenue 84 170 258 347 438 531 626 722 821 921 1,024 1,129 less Housing Set Aside (17) (34) (52) (69) (88) (106) (125) (144) (164) (184) (205) (226) less 25% Pass-Through (17) (34) (52) (69) (88) (106) (125) (144) (164) (184) (205) (226) less 21% Pass-Through ................... Begin Pass-Through: (55) (72) less 14% Pass-Through ~-~'.-~'~'~. Total Pass-Through (34) (68) (103) (139) (175) (212) (250) (289) (328) (369) (464) (524) Agency Tax Revenue 50 102 155 208 263 3'18 375 433 492 553 560 605 08/07/97 P:\CDDA\TRENDSCE.WB2 Combined Areas Combined Areas 2% Growth Scenario (000's Omitted) Year 13 14 15 16 17 18 19 20 21 22 23 24 Assessed Valuation 544,261 555,146 566,249 577,574 589,125 600,908 612,926 625,184 637,688 650,442 663,451 676,720 Year 11 Base (21% Pass Through 31,392 '42,277 53,380 64,705 76,256 88,039 100,057 112,315 124,819 137,573 150,582 163,851 Year 31 Base (14% Pass Through Increment Assessed Valuation 123,529 134,414 145,517 156,842 168,394 180,176 192,194 204,453 216,957 229,710 242,719 255,988 Property Tax Revenue 1,235 1,344 1,455 1,568 1,684 1,802 1,922 2,045 2,170 2,297 2,427 2,560 less Housing Set Aside (247) (269) (291) (314) (337) (360) (384) (409) (434) (459) (485) (512) less 25% Pass-Through (247) (269) (291) (314) (337) (360) (384) (409) (434) (459) (485) (512) less 21% Pass-Through (90) (109) (127) (146) (166) (185) (206) (226) (247) (269) (291) (313) less 14% Pass-Through Total Pass-Through (584) (646) (709) (774) (839) (906) (974) (1,044) (1,115) (1,188) (1,261) (1,337) Agency Tax Revenue 651 698 746 795 845 896 947 1,000 1,054 1,110 1,166 1,223 08/07/97 P:\CDDA\TRENDSCE.WB2 Combined Areas Combined Areas 2% Growth Scenario (O00's Omitted) Year 25 26 27 28 29 30 31 ' 32 33 34 35 36 Assessed Valuation 690,254 704,059 718,140 732,503 747,153 762,096 777,338 792,885 808,743 824,918 841,416 858,244 Year 11 Base (21% Pass Through 177,385 191,190 205,271 219,634 234,284 249,227 264,469 280,016 295,874 312,049 328,547 345,375 Year 31 Base (14% Pass Through 15,242 30,789 46,646 62,821 79,320 96,148 Increment Assessed Valuation 269,523 283,328 297,409 311,772 326,422 341,365 356,607 372,154 388,011 404,186 420,684 437,513 Property Tax Revenue 2,695 2,833 2,974 3,118 3,264 3,414 3,566 3,722 3,880 4,042 4,207 4,375 less Housing Set Aside (539) (567) (595) (624) (653) (683) (713) (744) (776) (808) (841) (875) less 25% Pass-Through (539) (567) (595) (624) (653) (683) (713) (744) (776) (808) (841) (875) less 21% Pass-Through (336) (359) (382) (407) (431) (456) (482) (508) (535) (562) (590) (618) less 14% Pass-Through Begin Pass-Through: (110) (127) (145) (163) (182) (201) Total Pass-Through (1,414) (1,492) (1,572) (1,654) (1,737) (1,822) (2,018) (2,124) (2,232) (2,342) (2,454) (2,568) Agency Tax Revenue 1,282 1,341 1,402 1,464 1,527 1,592 1,548 1,598 1,648 1,700 1,753 1,807 08/07/97 P:\CDDA\TRENDSCE.WB2 Combined Areas Combined Areas 2% Growth Scenario (O00's Omitted) Year 37 38 39 40 41 42 43 44 45 Totals Assessed Valuation 875,409 892,917 910,776 928,991 947,571 966,522 985,853 1,005,570 1,025,681 30,852,456 Year 11 Base (21% Pass Through 362,540 380,048 397,907 416,122 434,702 453,653 472,984 492,701 512,812 8,203,015 Year 31 Base (14% Pass Through 113,313 130,821 148,679 166,895 185,475 204,426 223,757 243,474 263,585 2,011,390 Increment Assessed Valuation 454,678 472,186 490,044 508,260 526,839 545,791 565,121 584,838 604,950 11,919,539 Property Tax Revenue 4,547 4,722 4,900 5,083 5,268 5,458 5,651 5,848 6,049 119,195 less Housing Set Aside (909) (944) (980) (1,017) (1,054) (1,092) (1,130) (1,170) (1,210) (23,839) less 25% Pass-Through (909) (944) (980) (1,017) (1,054) (1,092) (1,130) (1,170) (1,210) (23,839) less 21% Pass-Through (647) (676) (706) (737) (768) (800) (832) (865) (899) (15,096) less 14% Pass-Through (220) (239) (259) (280) (301) (322) (343) (366) (388) (3,645) Total Pass-Through (2,685) (2,804) (2,926) (3,049) (3,176) (3,305) (3,436) (3,570) (3,707) (66,420) Agency Tax Revenue 1,862 1,918 1,975 2,033 2,093 2,153 2,2'15 2,278 2,343 52,776 08/07/97 P:\CDDA\TRENDSCE,WB2 BUDGET AND FINANCE COMMITTEE - 1998 PROPOSED MEETING SCHEDULE MONDAYS AT 12:15 PM COMMITTEE MEETING COUNCIL MEETING January 5 January 14 None January 28 February 2 February 11 None February 25 None March 11 March 16 March 25 None April 8 April 13 April 22 None May 6 May 11 May 20 None June 10 June 15 June 24 None July 15 July 20 August 12 August 17 August 26 None September 9 September 14 September 23 None October 7 October 12 October 21 None November 4 November 9 November 18 None December 2 December 7 December 16