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HomeMy WebLinkAbout12/17/2004 B A K E R S F IE D ~ ~ &--~c~.--~ Mike Maggard, Chair Staff: John W. Stinson Harold Hanson For: Alan Tandy, City Manager AGENDA SUMMARY REPORT SPECIAL MEETING BUDGET AND FINANCE COMMITTEE Friday, December 17, 2004 · 1:00 p.m. City Manager's Conference Room - City Hall 1. ROLL CALL Called to Order at 1:09 p.m. Present:Councilmember Mike Maggard, Chair; Councilmember Harold Hanson Committee Chair Maggard stated for the record that due to the recent retirement of Councilmember Salvaggio and because Committee appointments will not be made until January 2005, this Committee has only two members present for this meeting. 2. ADOPT SEPTEMBER 20, 2004 AGENDA SUMMARY REPORT Adopted as submitted. 3. PUBLIC STATEMENTS 4. NEW BUSINESS A. Staff report andCommittee recommendation regarding Fireworks Fees Finance Director Gregory Klimko provided an overview of the proposed changes and additions to fireworks permit fees. It was noted that only the proposed $40 application fee would apply to all applicants who apply for a fireworks permit. The balance of the fees and cleanup deposit being recommended would be charged to only those who will be receiving a permit. Fire Chief Ron Fraze explained the enforcement fee does not cover the costs for enforcement, but will help to cover the cost for overtime on July 4th. In addition to AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Friday, December 17, 2004 Page - 2 - Fire Services increased enforcement during fireworks sales, Fire will partner with Police to put 10 two-member enforcement teams out patrolling for the busiest eight hours on the 4th. The following is a comparison of the current and proposed fireworks permit fees: Current. Proposed Application Fee: $ 00.0 $ 40.00 Permit Fee - Processing: Finance, Plan/Build, Risk, Traffic49.00 90.00 Inspections: Fire 52.00 113.00 Enforcement: Fire and Police 00.0 97.00 Permit Fee: $101.00 $ 300.00 Electrical Permit: 40.00 40.00 Clean Up "Deposit": 100.00 100.00 Total Fees and Deposits: $241.00 $480,00 Roger W. Jobe, Phantom Fireworks, stated he came to the meeting to find out what the proposed new fees were so he could share the information. Staff recommended the above proposed fireworks permit fees and increases be adopted and included in the cost recovery system fee schedule. Committee Member Hanson made a motion to approve staff's recommendation. Committee Chair Maggard voted to approve the motion and to forward to the Council for hearing. B. Staff report and Committee recommendation regarding Maintenance Districts City Manager Alan Tandy reported staff has completed a review of the City's maintenance district policies, practices and costs and has formulated a new draft schedule of rates based on costs for FY 2003-04. It was determined maintenance district assessments have not kept up with the costs for providing services as there is no built-in cost of living increases for inflation. For over eight years since passage of Proposition 218, there have been no increases in maintenance district assessments because of the new vote requirement to increase rates. Because assessments have not kept pace with. inflationary cost increases, it has necessitated an increase in the General Fund subsidy provided to the consolidated park and landscape maintenance district. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Friday, December 17,' 2004 Page - 3 - The City Manager explained since the General Fund has been hit hard by State revenue captures, staff is making the following two recommendations: 1. All new areas added to the consolidated park and landscape maintenance district be formed using the updated new rates; and 2. Apply an annual cost of living factor to new areas added to the consolidated park and landscape maintenance district. This would ensure assessments for new areas cover costs and keep up with inflationary increases. The above two recommendations are relatively straight forward to implement since both involve newly developing areas. At the time the developer signs a petition to be added to the consolidated maintenance district, the developer (one sole vote) would agree to the higher assessment and annual cost of living adjustments. The assessment information would be disclosed to the new homebuyers at the time of the sale. The information has been shared with Brian Todd, Building Industry Association of Kern County, who was unable to attend this meeting. Committee Member Hanson made a motion to approve staff's recommendation for updated rates and annual cost of living increases for new areas when added to the consolidated park and landscape maintenance district. Committee Chair Maggard voted to approve the motion and to' forward the recommendation to the City Council in January. City Manager Tandy explained there is a third issue regarding current maintenance district assessments, which have not kept up with inflation or the costs for providing services for park and landscaping maintenance. Staff did not make a recommendation but provided the following information to the Committee. The only way to increase assessment rates for the existing consolidated park and landscape maintenance district to bring them up to current levels and/or provide an annual cost of living adjustment to keep up with inflation is to conduct a Proposition 218 mail ballot. The existing areas still retain the assessments based on 1996 costs, and if not modified, will continue to increase the General Fund subsidy over time. Staff has been conducting research and there are some areas of concern: · A Proposition 218 election requires a majority approval of those voting within the maintenance district area · It is questionable whether residents within the maintenance district who vote would vote to increase their assessments · Tax and assessment measures have not fared well statewide in recent elections · The City would incur the cost of the election and pursuant to state law, cannot use taxpayer monies or staff time to support the passage of the measure AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Friday, December 17, 2004 Page - 4 - At this point in time, the Committee was not interested in going back to areas already developed to raise maintenance district assessments and did not take any action. Another issue the City Manager brought before the Committee was to form a street lighting maintenance district for new areas being developed to cover the costs of operations, maintenance and electricity, and also include an annual inflation factor. The City's cost for street lighting annually is about $2 million, which is paid from the General Fund. As we add more new subdivisions, this will go to $3 or $4 million over time. Public Works staff estimated the costs to be about $80 annually per street light. Based on an average of six parcels per street light, the assessment would be approximately $13 per home. Committee Chair Maggard expressed before we add anything else or form a street lighting maintenance district for new areas, fees that neighborhoods would pay, he was interested in having a more comprehensive discussion regarding neighborhood amenities to assess what would make the biggest impact on the neighborhoods to increase the standard of living, and weigh the costs involved for the different amenities. Committee Member Hanson felt this should be done all at once and not use a nickel and dime approach to keep going back to the community asking for increases. C. Staff report and Committee recommendation regarding Vehicle License Fee (VLF) Gap Loan Program Assistant City Manager John Stinson explained in FY 2003-04 the State "borrowed" a portion of the Vehicle License Fee (VLF) backfill owed to local agencies. This VLF gap loan is scheduled to be repaid by the State to the local agencies in 2006. The amount owed to the City of Bakersfield is about $4.5 million. State law requires this money to be paid back by August 15, 2006; however, the State by further action of the Legislature may be able to defer paying these monies. CSAC and the League of Califomia Cities successfully sponsored recent legislation, which permits local agencies to sell their VLF gap loan receivables to a third party and in essence get the money now, rather than waiting until 2006. California Communities (CSCDA) plans to issue fixed-rate bonds to purchase VLF receivables from cities and counties (local agencies) for an upfront fixed price currently estimated at 90 to 94 cents on the dollar. The bonds would be taxable or tax-exempt depending on their use. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Friday, December 17, 2004 Page - 5 - The City would be able to stipulate the minimum return that is expected, and if it does not meet that criteria, not participate. By purchasing the receivables, CSCDA would be assuming the risk of the repayment by the State. To make sure the bond purchasers are paid, CSCDA will be purchasing bond insurance, in case of default by the State. Staff is checking to assure they will indemnify the City in the event the State defers payment or does not pay. The funds would be one-time monies. If the City participates, staff recommended the funds be used for capital purposes, street resurfacing and repair, which would be consistent with Council policy. The Committee requested staff to prepare a list of roads that are most in need of resurfacing or repair so the community will know where the funds are projected to be used. Also, staff was requested to ascertain if membership in the League of California Cities would be necessary to participate. Committee Member Hanson made a motion the Committee recommend if the information continues to be positive, staff move forward to bring this to the full Council for consideration. Committee Chair Maggard voted to approved the motion. Staff will continue to investigate the details of the VLF Gap Loan Program and will keep the Council informed. 5. COMMITTEE COMMENTS 6. ADJOURNMENT The meeting adjourned at 2:32 p.m. Attendance: Staff: City Manager Alan Tandy; Assistant City Manager John W. Stinson; City Attorney Ginny Gennaro; Assistant City Manager Alan Christensen; Finance Director Gregory Klimko; Fire Chief Ron Fraze; Assistant Recreation and Parks Director Allen Abe; Assistant Finance Director Nelson Smith; Assistant Public Works Director Jack LaRochelle; City Clerk Pam McCarthy; Office Administrator/Public Relations Rhonda Smiley; Deputy Fire Chief Kirk Blair; Deputy Fire Chief Gary Hutton; Fire Prevention Director Ralph Huey; Fire Captain Ed Watts; Recreation and Parks Business Manager Rebecca Jamison; and Parks Construction/Facility Planner Ken Trone Others: Roger W. Jobe, Phantom Fireworks cc: Honorable Mayor and City Council S:\Darnell\O4Budget and Finance~bfO4dec17summary