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Home My WebLink About05/03/2001 BAKERSFIELD Mike Maggard, Chair Harold Hanson Mark Salvaggio Staff: Darnell Haynes BUDGET AND FINANCE COMMI'I'rEE of the City Council - City of Bakersfield Thursday, May 3, 2001 4:00 p.m. City Manager's Conference Room, Suite 201 Second Floor- City Hall, 1501 Truxtun Avenue, Bakersfield, CA AGENDA 1. ROLL CALL 2. ADOPT APRIL 5, 2001 AGENDA SUMMARY REPORT 3. PUBLIC STATEMENTS 4. NEW BUSINESS A. DISCUSSION AND COMMITTEE RECOMMENDATION REGARDING LETTER OF REQUEST FROM THE KERN COUNTY MUSEUM AUTHORITY BOARD FOR A CONTRIBUTION OF $100,000 TOWARDS KERN COUNTY MUSEUM OPERATIONS B. STAFF REPORTAND COMMITTEE RECOMMENDATION REGARDING SEWER SERVICE USER CHARGES FOR FY 2001-02 5. COMMITTEE COMMENTS 6. ADJOURNMENT S:~Damell~2001BFCommittee~bf01 may03agen.wpd DRAFT BAKER. SFIELD Alan Tandy, Cit~ger Harold Hanson Staff: Darnell Haynes Mark Salvaggio AGENDA SUMM.~:IY REPORT BUDGET AND FINANCE COMMITrEE Thursday, April 5, 2001,4:00 p.m. City Manager's Conference Room 1. ROLL CALL Call to Order at 4:03 p.m. · Present: Councilmembers Mike Maggard, Chair; Harold.Hanson and Mark Salvaggio 2. ADOPT MARCH 8, 2001 AGENDA SUMMARY REPORT. Adopted as submitted. 3. PUBLIC STATEMENTS 4. NEW BUSINESS A. Discussion and Committee recommendation on Fiscal Year 2001-02 Community Development Block Grant (CDBG), Home Investment Partnerships (Home), and Emergency Shelter Grant (ESG) Annual Spending Plan Community-Development Coordinator George Gonzales gave a staff report on the Annual Action Plan forFY 2001-02. This year the City's entitlement for CDBG, HOME and ESG programs is $4.6 million. As part of the City's procedure, non-profits and City departments were asked to submit a list of their priority projects for funding. Several Public Hearings have been held and Public Notices have been ·placed in the newspaper concerning the projects submitted and selected. A copy of the public notice was included in the Committee packet, which included the project titles,, project descriptions, funding source and amount, priorities and target dates. The City's application for the $4.6 million has to be to HUD by May 16~'. Council approval is needed prior to that date. The funds will be released to the City in July of this year. The Council may make amendments to the plan at a later date. A public notice will be run in the newspaper for 30 days to allow .public comments and upon approval by the City Council, HUD will be notified of the amended change. Committee member Salvaggio requested staff to move the Phase II Sewer Installation project for the Gwendolyn Street Area, which had a target date of summer 2002, up on the target date priority list, The Committee unanimously approved the FY 2001-02 Annual Action Plan of the Consolidated Plan 2005 for CDBG, HOME and ESG programs and forwarding to the Council for adoption. AGENDA SUMMARY REPORT DR AF BUDGET AND FINANCE COMMITTEE Thursday, April 5, 2001 Page -2- B. Discussion and Committee recommendation regarding request for City Housing Assistance for the CanYOn Hills Senior Housing Project This project is not in a redevelopment-project area, but is an affordable senior housing project located off .Fairfax. The project is substantially complete. Canyon Hills received.tax credits for most of their financing to complete .the project. Approximately. two years ago, they submitted an application to the City for $293,000 of HOME fundsto cover their funding gap, which was disallowed by HUD 'because upon receiving their tax credit application, they began construction. When they began construction, it removed the ability to put HOME money into the project for the follow reasons: 1) they did not identify HOME funds as a public source on their tax credit application; and 2) there were issues with HUD not allowing going back to refund for a completed project. Due to the timing of construction, the project started out with a $293,000 shortfall. During construction, they had construction lending issues: 1) the lender did not loan the anticipated amount; 2) there were unanticipated reserve requirements; 3) the law changed a little and they did not receive as much tax credit as anticipated; and 4) all the units are very Iow-income, which restricts income and borrowing capacity, so the funding gap has grOwn to almost $600,000. Staff identified two funding sources for Committee review. Canyon Hills is in' the process of converting from construction financing into .permanent financing. HUD allows a percentage of associated soft costs to:be funded with HOME funds. Staff has determined those costs to be about $106,000 in eligible HOME funds. The second source for Committee review is Redevelopment Agency Downtown Housing funds. There is not a great deal of housing activity in the downtown area. Historically, the City has used these funds in another project area. The Canyon Hills Senior Housing Project is not in a project area. However, it is a large project with a lot of units restricted very Iow and reserved at 60 percent or below median income. The :Downtown Area would get credit for a large count of Iow-income housing. Staff has identified total funding of $460,000 .between the Downtown Housing Fund and the allowed HOME funding. The Downtown Housing Set Aside allocation is about $350,000 per year, so it would be necessary to go into next year's allocation as well. With approval, staff could start negotiating.and structuring some kind of loan with those funds to be repaid over time, perhaps seven to ten years. 'there is not enough funding .aVailable to cover the entire $600,000. City Manager Alan Tandy stated staff is.comfortable recommending funding as this is a charitable organization in some trouble due to the timing of their project, and the City has contributed to other significant projects at a higher level. Also, there is a limit on how long Housing Set Aside monies can be held. In some years it has been allocated Citywide for First-Time Home Buyers' programs because there were no projects 'in or near the downtown for which to allocate the funds. In more recent years, there are two projects: Park Place and now the Capital Vision Equity project within City Center. These are both very close to the Downtown Project Area. 'It was also noted, if this much money isloaned for seven years, there may not be funds immediately available to do another project in the downtown if the opportunity arises. To use Downtown Project Area funds outside of that Area requires approval of the Redevelopment Agency. The Agency would need to have a finding there is benefit to the Downtown Project Area to use the funds in another area. As Canyon Hills .is senior Iow-cost housing, for every two units Canyon Hills provides, the Downtown Project Area would get credit for one unit to meet the inclusionary housing requirement. The Committee unanimously approved staff moving' forward with the funding, contingent upon approval of the Redevelopment Agency. DRAFT AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Thursday, April 5, 2001 Page -3- C. Discussion and Committee recommendation regarding the City of Bakersfield's participation in the "Clean Green Yard Machines" Program .... Ms. Kelly Malay, Air Quality Educator from the San Joaquin Valley Air Pollution Control District, gave an overview of the "Clean Green Yard Machine" program and their requeSt for a $5,00Ocontribution from the City. This is a program to offer 1,200 Valley residents (300 in Bakersfield) a $200 incentive toward the purchase of a rechargeable electric mulching lawn mower that retails for approximately $400. The event is scheduled for April 28~, Residents.bringing in their gas-powered mowers get a voucher toward the purchase of an approved mower. Funding is also needed to dispose of the ' mowers traded in. Similar programs have been used successfully in other cities. The San Joaquin Valley faces significant air-quality challenges and small gasoline-powered engines such as those used for lawnmowers are considered a major sourceof air quality problems as they emit ozone precursors that contribute to smog. In return for a $5,000 contribution, not only would the City be investing in air-quality improvement efforts, the District would recognize the City on all pre-event materials, advertisement, promotions, and publicity. The County of Kern has ~agreed to contribute $5,OOO. The Committee discussed the importance of changing life-styles to reduce smog and programs like this as a beginning. The Committee unanimously recommended funding the $5,000 contribution out of Council Contingency and forwarding the report to the Council for approval. D. Discussion and Committee recommendation regarding Proposed Policy of using 10 Percent of one-time monies to retire debts · City Attorney Bart Thiltgen explained this was a referral to the Committee to review setting aside one-time monies to be able to call debt on the multi-purpose stadium, if that project moves forward. Tax counsel has advised monies can be set aside at the time of the issuance of the bonds, but would have to .be disclosed in the disclosure statement, so that bond purchaSers would .be aware they are subject to ~the ten-year call date. A sinking fund can be set up to retire stadium debt, but · '. due to IRS rulings is limited to the interest rate that can be received, as you cannot keep higher ......: interest on a specific sinking fund than the interest being paid on the bonds. ". The Finance Director explained one-time monies can be set aside in an account for generic purposes to be used when there .is an opportunity to save money or call debt. Traditionally, with Council approval, the City uses one-time monies to finance capital improvement projects, to avoid borrowing for needed projects. Several times in the-past, the City has refinanced bond structuring to take advantage of market rate changes or has called debt when there is a savings advantage. Staff recommended having the Finance .Director monitor and as staff becomes aware of one-time monies, bring a proposal to the Council to decide if they wish to use the money to call debt or build capital improvement projects. I' Committee Chair Maggard made a motion that the Committee has evaluated set-aside of one-time -monies and recommended the issue be referred to the Finance Director to make the Council aware of their options when there are one-time monies available. The Committee unanimously approved the motion. DRAFT BUDGET AND FINANCE COMMITTEE Thursday, April 5, ~001 Page -4- E. Discussion and Committee recommendation regarding cooperative efforts between the City of Bakersfield and Kern County to provide sewer service to the southwest corner of Allen Road and Rosedale Highway As there .were no sewer lines adjacent to the property, the County permitted an Albertson's grocery ..... · ' store to be built using a .septic tank, which 'is not working properly. The City has a sewer project within one-quarter to one-half mile and Albertson's had contacted the City regarding extending the sewer line. County and City staffs met to devise a mutual solution to acCommodate the request. City staff proposed putting $600,000 up front to extend the sewer line well north of Albertson's.. In exchange for the up front Construction monies and the benefit of providing many residents in the area access to sewer service, Albertson's would be annexed to the City. However, the City has received a letter from the County stating that they have decided to extend the sewer line to Albertson's. Under the CSA-71 Agreement, they have this right. No action was taken by the Committee. 5. COMMI'I=rEE COMMENTS Committee Chair Maggard asked the status of the Committee's referral from Councilmember Carson regarding coordinating efforts in the Southeast Redevelopment Area. Staff has been in contact with Councilmember Carson. She is having meetings with the Southeast PAC and various interests groups to develop plans to bring to the Committee. 6. ADJOURNMENT The meeting adjourned at 5:16 p.m. Staff present: City Manager Alan Tandy; City Attorney Bart Thiltgen; Assistant City Manager John W. ,' Stinson; Finance Director Gregory Klimko; Assistant to the City Manager Darnell Haynes; Assistant :.~.~ Finance Director Nelson Smith; Interim Public Works Director Jack La Rochelle; Public Works Operations Manager Brad Underwood; Economic Development Director Donna Kunz; Community Development Coordinator George Gonzales; Assistant~Recreation and Parks Director Allen Abe; Solid Waste Director Kevin Barnes Others present: Reporter James Burger, The Bakersfield Californian; Dave CrosS, Architect; Ms. Kelly Malay, San Joaquin Valley Air Pollution Control District ~ cc: Honorable Mayor and City Council DWH:Jp $'./Damell/2001BFComrnittee~f01ap~OSsumma~/.wl:~l March 26.20~q'}~'7'RS?-iiL~ CiTY CLERK Councilwoman Sue Benham City of Bakersfield 1501Truxtun Avenue Bakersfield. CA 93301 .KEF/'/ Co/d/'/t_y Dear Councilwoman Benham: · ': I~U'SI~-UI~ The Kern County Museum Authority Board voted at it's March 12. ','.' AUTHORITY 2001 meeting to request that the City of Bakersfield consider become a fully participating partner on the Kern County Museum BOARD Authority with a contribution towards museum operations. As you know. the Museum Authority Board is a governmental ,~n.tity. with )c.. ~'.11. you as appointed representative of the city. I Bakersfield CiO $ch**l District L..,,r v.. R.i,t., With $3.5 million in funding for construction of our new oil exhibits in sv,,.,,..~,., o/S,~oot, state Proposition 12. the museum is poised to become a major s.B.~,.= tourist attraction for our community. The sales tax and Transient Baker~fidd Ci~7 · ,o.d ~ Occupancy Tax increases to be associated with tourism from our P...~, W.l.~o enhanced facility will be substantial, if our marketing and visitor .~.,,.~, ~:ox.do,io. service staff and advertising budget can be increased. Milo E. Hall ~o.,~ ¢ ~.,..o. The museum collects materials related to .the history of Kern County B.I H...t,., and its major urban center, the City of Bakersfield. We presently ~,...~.~, s,,°a vis,ri,, assist the City in the following ways: Oougla~ Miller Pa,ama. Bt~e~a · - C~o. S,,oo/Dis,ri,, · Providing a unique educational and recreational destination for P... ~'.,,a citizens and visitors of all ages. working with the Greater "'.. ~.r~.,.~°~'~is'ri"°/s~P'"'~'°'~'a..i.k ~ Bakersfieldpromotion Convention and Visitor's Bureau on tourism ~o..~ cs~,,,~,o. · Assisting with changing exhibits in the Centennial Garden's Hall t~,,,., ~ of Fame · · Collecting and preserving and displaying aspects of Bakersfield's 3801 Chester Avenue ~er,,~e,d. c^ 9~o~ rich history for present and future generations (~) s~,.m: · Providing a research archive to a diverse audience from families F.-(X (661) 322-6415 "n'¥ ~e,,,. ,.s00.73s-z9:,to corporate offices to History Day students. The archives · includes 500,000 photographic images, the vast majority related ^ Joint ~'o~,e. ^.,ho~,~ to Bakersfield and its immediate environs administered by thc OC,.e or ~..rry [~. ~e~aer · Evaluating Environmental Impact Reports for historic and cultural ~Ce~. Cou..~ impacts Superintendent o~ Schools Carola R~pcrt E~riquez 3[#tt~ Dirrctoe · Providing leadership and administrative support to the 34a Street Neighborhood Partnership headquartered at Stella Hills Elementary School We have begun discussions with the Bakersfield Sister City organization to see how w~ might assist them in displaying, organizing and storing the materials donated to the .city from its various Sister Cities. We would be happy to work with the city as it considers adding additional cultural amenities in public spaces downtown, such as at the new Amtrak Station. .K'gr~ ~'o/~(~]/ The museum's current operating budget comes from the County of Kern and the Kern County Superintendent of Schools. A budget for ~:~: M HSEUM 2001-2002 requiring $600,000 from each of these two entities is being constructed. We ask for an initial contribution of $100,000 for AUTHORITY 2001-2002 from the City of Bakersfield for basic operational support. BOARD We would appreciate your referral of this request to the City of Bakersfield Budget & Finance Committee. l],Iurtfit/8¢i~$caoo/Dia,qaLarry E. Rciclcr '~cerely',.r/ Milo £. Hall ~,,, Co.,,~ Cc: Mayor Harvey Hall Bo,,~ o/E~.,,,io. Each Council Member i" Bill Hatcher Kern Hr, eh .~chool Dittritt Douglas Miller Panama. Buena {.'nion School Dittritt Peter Parr° B*ard of $~?trvitort Dittrict $ Barb~r~ Patrick Board of Supervitort Dtttvict ] 3801 Chester Avenue Bakersfield. CA 93301 (661) 861-2132 FAX (6fit} 322-6415 "l-rY Relay 1-800-735.2929 A Joint Powers Authority administered by the Office of Larry E. Reider Kern County Superintendent of Sehool~ torch Rupert Enriqucz ,~lute~at Director