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HomeMy WebLinkAbout05/03/2001 BAKERSFIELD ~<~~"~;f- Mike Maggard, Chair Alan Tandy, Citty ~i~ager Harold Hanson Staff: Darnell Haynes Mark Salvaggio AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Thursday, May 3, 2001,4:00 p.m. City Manager's Conference Room 1. ROLL CALL Call to Order at 4:10 p.m. Present: Councilmembers Mike Maggard, Chair; and Mark Salvaggio Absent: Councilmember Harold Hanson 2. ADOPT APRIL 5, 2001 AGENDA SUMMARY REPORT Adopted as submitted. 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 Darnell Haynes stated the City has an elected official (Councilmember Sue Benham) on the Museum board and staff has attended several meetings at the Museum discussing their plans to turn the Museum into a world-class destination that would encourage tourism. The Museum has Proposition 12 bond money ($3.5 million) for their planned Oil Exhibit. The City has received a request from the Kern County Museum for the City to participate with a contribution of $100,000 toward basic operational expenses. The City is in the process of putting together the budget for FY 2001-02 and resources are limited. Typically, the Council's policy has been to fund one-time capital projects, and the request before the Committee is for ongoing operational expenses. There are many needs in the community and the City has recently received several requests for funding. Don Murfin, Kern County Museum Foundation, spoke regarding their request. He feels their request is different because they are not a nonprofit, but a government agency operated by the Museum Authority Board, which is formed under a joint powers agreement with the County of Kern and County Superintendent of Schools. The board was formed three years ago and the City' has a representative on the board. The Museum is located in the City and in the Old Town Kern-Pioneer Redevelopment Area. ADOPTED AS SUBI~TTED ON JUNE 5, 2001 AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Thursday, May 3, 2001 Page -2- The Museum is beginning phase one of a four-phase program to develop and enhance the Museum. The plan is to have $9 million in new assets three years from now. The Museum has already received $4 million in cash and in-kind contributions to create an Oil Exhibit, including (Proposition 12) State Parks Bond money. The Oil Exhibit has broken ground and will oPen in the in the fall of 2002. An additional $5 million, which includes a $1.5 million endowment and $3.5 million to upgrade facilities, is planned to be accomplished through a fund-raising campaign in the community. There are plans for an agricultural exhibit and to · reorganize with themes to fit the history of this community, so a history of water, agriculture and oil will all be represented. It was explained this request is for $100,000 per year on an ongoing basis for operational expenses. Kern County is being asked to increase their support from $400,000 to $600,000 with matching funds from the Kern County· Superintendent of Schools. Museum Director Carola Rupert-Enriquez spoke regarding future plans for the Museum. Committee member Salvaggio stated he was pleased to see the County of Kern and the Superintendent of Schools join together in support of the Museum. He further expressed that the Kern County Museum it is a great part of the community and wants to be helpful, but explained the numerous requests the City is receiving for funding from different private groups; the City's infrastructure needs; and the City's limited resources. The City's policy historically is to try to be helpful and fund one-time expenditures, rather than ongoing.costs; capital expenditures, rather than Operating expenditures; one-time activities tied to specific Council goals; and use of City facilities by nonprofit groups. There was discussion about the many recent contributions the City has given to the arts including $30,000 to the Bakersfield Museum of Art for a sculpture garden. Also, the Bakersfield Museum currently has a request before the Budget and Finance Committee for $28,500 to fund half the cost for an exhibit planned for this fall. Don Murfin introduced Milo Hall, Kern County Superintendent of Schools office and Chairman of the Museum Authority Board. Committee Chair Maggard expressed the Kern County Museum is a very worthy cause. The dilemma is that the request is for ongoing, operational funding. Because of the one-time funding policy for capital projects, the City has been able to help many causes. He is very much in support of the arts and expressed when history looks back on a community, its emphasis on the arts to a great extent determines the value, heritage and the view that is held of that community and in future, planning would like the City to participating with more of a role in the arts. With agreement of the Kern County Museum representatives present at the meeting, the Committee requested staff work to with Museum staff to help repackage the request so it would be for a specific purpose rather than ongoing. Also due to budget constraints, explore if CDBG money may be available for programs for school children from Iow-income areas, handicapped accessibility at the Museum, or medians in front of the museum. This item to return to the Committee. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Thursday, May 3, 2001 Page -3- B. Staff report and Committee recommendation regarding Sewer Service User Charges for FY 2001-02 City Manager Alan Tandy explained the State has mandated the City change its rates for sewer user charges among different categories. Under threat of fines or having to reimburse the State millions in grants and loans, the City has no option about restructuring its rates. There are three categories, which fall under the change: hospitals, nursing homes and schools. A three-year phase-in program (Option 1) was presented to the Council, and the Council directed staff to contact the. State to see if they would accept a longer term. The maximum the State will accept for these categories of usage is up to 15% a year as a phase-in. Option 2 will allow hospitals a seven year phase-in; nursing homes would be a five year phase-in (to meet the State allowed 15%); and schools a three year phase-in. Option 3 is a five year phase-in for all three categories. Because the City is undercharging on the three categories of rate-payers, other rate-payers on the current schedule are paying more to make it balance. Cumulative subsidies are: Option 1 = $195,507; Option 2 = $289,328; and Option 3 = $392,483. The City has no choice but to comply as the State who has notified us that the City's rates are out of compliance for the above three categories. The City has received a letter from the State stating: "If the City's existing wastewater rates do no comply with the requirements of the federal Clean Water Act, the City may be subject to sanctions and penalties." Also, the State has been withholding funds owed to the City. Sharon Carlson, Truxtun Manor residential care facility, spoke about this charge being on a per bed basis and they are licensed for 36 beds, but the maximum they have is 25 beds in use and this is an economic hardship on their business. The Committee referred Ms. Carlson to Economic/Community Development to explore assistance options that may be available. Jean Schamblin, Gabler Continuing Care, spoke and also ask why group homes are not charged extra? The Committee directed staff to check into how group homes are charged. In response to a question, Finance Director Gregory Klimko stated for flat rates the City levies about $10 million a year in fees. The rates include several factors such as, operation and maintenance costs for sanitary sewers, storm sewers, and plants. Monies are built in the rates for depreciation and plant and sewer line replacement. Last year the City spent more than received, as monies were spent for capital projects. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Thursday, May 3, 2001 Page -4- Committee Chair Maggard wants to be able to justify to his constituents that we are collecting no more in sewer fees than the City needs. Staff explained we are not raising rates. At the direction of the State, we are adjusting some rates up and some rates down so rate-payers pay their proportionate share. This must be imposed by July 1,2001 in order to place the correct rate on the tax bills. The Committee unanimously recommended Option No. 3, with the caveat that Public Works staff create another 100 accounts (93 for nursing home and 7 for hospitals) and monitor their flow, so they are charged based on flow. (Committee member Hanson absent) The Public Hearing will be opened at the Council meeting of May 16, 2001. 5. COMMrl'rEE COMMENTS Committee member Salvaggio asked about the status of the City of Bakersfield Annual Action Plan 2001-02 approved by the Committee and at that Committee meeting, staff had indicated the Gwendolyn Sewer Project could be moved up to summer of 2001. Public Works staff responded it is in the process to get started this summer. Committee Chair Maggard asked staff to have Donna Kunz contact him regarding targeted redevelopment area along Columbus Avenue. Staff was asked to check with Committee members for another date in June as there are scheduling conflicts with the scheduled June 7th Committee meeting date. 6. ADJOURNMENT The meeting adjourned at 6:02 p.m. Staff present: City Manager Alan Tandy; Assistant City Attorney Bob Sherfy; Assistant City Manager John W. Stinson; Finance Director Gregory Klimko; Assistant to the City Manager Darnell Haynes; Interim Public Works Director Jack La Rochelle; Assistant to the Public Works Director Georgina Lorenzi; Public WorksNVastewater Superintendent Joe Turner and Wastewater Supervisor II Wen-Shi Cheung Others present: Jeanne Schamblin, Gabler Continuing Care LLC; Sharon Carlson, Truxtun Manor; Milo Hall, Kern County Superintendent of Schools Office; Don Murfin, Kern County Museum Foundation; Carola Rupert-Enriquez, Director, Kern County Museum; and Matthew Palmer, Kern County Museum cc: Honorable Mayor and City Council DWH:jp S:/Damell/2001BFCommittee/bf01 may03summary.wpd