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HomeMy WebLinkAbout08/11/1997 BAKERSFIELD Randy Rowles, Chair Irma Camon Kevin McDermott Staff: Dolores Teubner AGENDA BUDGET AND FINANCE COMMITTEE Monday, August 11, 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 APRIL 14, 1997 MINUTES 3. PRESENTATIONS 4. PUBLIC STATEMENTS 5. DEFERRED BUSINESS A. REPORT ON RESULTS OF SOUTHEAST ENFORCEMENT PROGRAM - Brummer 6. NEW BUSINESS A. ECONOMIC TREND ANALYSIS FOR REDEVELOPMENT STUDY AREAS - Wager B. COST RECOVERY SYSTEM - Teubner C. KERN COUNTY MUSEUM MASTER PLAN STUDY 7. ADJOURNMENT FILE DRAFT BAKERSFIELD ~.4c~ ~-' ~'~ ' Randy Rowles, Chair Alan Tandy, City Manager Irma Carson Staff: Dolores Teubner Kevin McDermott AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE - Monday, April 14, 1997 12:15 p.m. City Manager's Conference Room 1. ROLL CALL Call to Order at 12:25 p.m. Present: Councilmembers: Randy Rowles, Chair; Irma Carson; and Kevin McDermott 2. APPROVAL OF THE MARCH 10, 1997 MINUTES Approved as submitted. 3. PRESENTATIONS None 4. PUBLIC STATEMENTS None 5. DEFERRED BUSINESS A. POLICY ON INSTALLATION OF CURB AND GUTTER Staff proposed an administrative fee of eight percent be charged for curb and gutter construction on private property done by City forces. An earlier concern by the DRAFT AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, April 14, 1997 Page -2- Committee identified the inconsistency in not charging a fee in this case, but charging it in all other cost recovery service centers. The City Manager indicated that the intent of providing the service was to assist Iow income residents. However, if the Committee chooses to recommend including an administrative fee, the amount should be kept to a minimum. Staff will address this issue more completely in conjunction with reviewing the City's cost recovery system. 6. NEW BUSINESS A. SOUTHEAST BAKERSFIELD CRIME PREVENTION AND ENFORCEMENT Staff presented a proposal that would target anti-gang violence in Southeast Bakersfield. The program involves saturation of police patrol, development of an anti-gang hotline and expansion of the COPPS program and Police Activities League (PAL) programs. Estimated program costs total $182,200. Southeast area residents spoke of escalating gang violence and th~ urgent need to address the problem. The Committee asked staff to initiate the program by funding with current year budget savings and/or an additional appropriation. Other suggestions for a comprehensive program included making absentee landlords responsible for gang activities conducted on their properties; and advocating legislation that took into account adult offenders' juvenile crime record. The Committee approved commencing the program. Staff will report on the budget impacts and the progress of implementation during the 1997/98 budget presentations to Council. The City Attorney also provided a proposal to adopt tougher loitering ordinances. This will be brought back for further review. 7. ADJOURNMENT The meeting was adjourned at 1:40 p.m. cc: Honorable Mayor and City Council DBT:ip Budget and Finance Committee Meeting of August 11, 1997 BAKERSFIELD MEMORANDUM August 4, 1997 TO: Budget and Finance Committee FROM: Alan Tandy, City Manager ~/~' ~~ 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 "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" "Staggered" 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 "Parallel" Both project areas are adopted simultaneously. 08/07/97 P:\CDDA\COSTMATR.WB2 Parallel Assumptions Used to Create Examples of Costs and Revenues' · 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 Ann. ual CDBG Entitlement 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ~ 0 0 0 ~ -.~ 0 0 0 0 0 o i"' ~ ~ > 0 i c 0 < 0 i'~' ~ © 0 '~ o ~ × 0 × ~ o 0 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 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 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 Examples of Costs and Revenue · Project Formation Proceeds in a Staggered Fashion · Consultant Cost - $250,000 (Range of Estimate from Four Firms - $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 ® X 0 ~ 0 c0 ~ ~ ~ o ~ 0 0 0 0 0 0 0 ~ 0 0 0 0 © 0 0 0 0 0 0 o ~ o o ~ 0 0 0 0 0 ~ ~ ~ ~ 0 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 TotalAgency Expenses 0 97,697 150,532 156,659 160,051 160,485 157,582 151,090 · 161,812 Fund Balance $0 ($133,322)($18'1,853) ($183,5'12)($'134,563) ($35,048) $'i25,371 $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 ~ 0 0 0 0 0 0 0 0 0 0 0 ~ ~ © © © © © 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 50 102 155 208 263 318 375 433 492 553 560 605 08/07/97 P:\CDDA\TRENDSCE.WB2 Combined Areas Combined Areas 2% Growth Scenario (O00'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 (000'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) les~ 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 (000'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 2,215 2,278 2,343 52,776 08/07/97 P:\CDDA\TRENDSCE.WB2 July 31, 1997 ~ Mayor Robert Price · "":~,:::.' i 1501 Truxtun Avenue Kem County Museum:: j Bakersfield, CA 93301 Kev~C.n.d~y, Dear Mayor Price' v~c~rm., '. I am the current chairman of the Kern County MelissaFortune, Museum Foundation board of directors. Realizing that you Chief F'~nci~l Off, er ClaudiaYoung-Holdemess, are a long time supporter of the Museum, the purpose of ~ "~ ' this letter is to solicit the City's support in several efforts, Caro~ Ru~rt Enriquez,. Pr~d,~. which are designed to enhance the Museum. The success T,,~e~. of these efforts will benefit the citizens of Bakersfield and all of Kern County. Jackie Belluomini '~ · Do~D~. "..., A Joint Power Authority ("JPA") agreement is D~aF, e~ .':', . currently under study by a committee composed of GlnaFanucchi :: members of the Foundation's board of directors; Troy Grant C,~H~'~r .,/: , representatives of the County Administrator's Office; : ~~.:,':,i~?~:~,, ~ Supervisor Barbara Patrick; the Board of Education; and oou~-',:, Kelly Blanton, the Superintendent of Schools G~rg~~ ?, ' ("Committee") Under the JPA agreement, the governance Ma~eV.S~',. of the Museum would be delegated to the JPA thereby Barbara Tennis making the Museum an asset of the entire community. Patty Waldo Due to the Museum's location in the heart of the City, the Committee unanimously believes that it is essential to the achievement of the Committee's goal that · the City's interests and perspectives be represented on the Committee. To that end, the Committee requests the City to appoint a councilperson to the Committee. Since the 3801 Ch~s~rA~ue. Museum is in the ward of Pat DeMond, the Committee Elakersfie/d, CA 93301 Voice* (805) 861-2132 Fax: (805) 322-6415 . -. 'T'FY Relay 1-800-735~2929 Mayor Robert Price July 31, 1997 Page 2 recommends her appointment as the City's representative on the Committee. The Committee believes that the Museum and the adjacent parklands fronting on the Kern River could be a crown jewel for the City if this area of approximately 100 acres is properly developed. The Committee believes that the proper development of this area would be more likely if a master plan study is commissioned for that purpose. Since the Museum and the adjacent parklands are in the - heart of the City, the Committee requests and encourages the City to support and participate in a master plan study to be certain that its interests and goals are addressed. Finally, the Committee hopes that a Joint Power Authority will begin to govern the operation of the Museum effective January 1, 1998. The Committee encourages the City to become a part of the JPA by agreeing to appoint a Councilperson to serve on the JPA board. Thank you for your interest in the Museum. The Committee looks forward to working with the City on these matters. ~KERN COUNTYK./~.~_M U S E~O N cc: Ms. ~at DeMond CM\02030015\LTR\KCF~O03