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HomeMy WebLinkAbout08/22/2005 B A K E R S F IE L D ~ ~ ~ Mike Maggard, Chair Staff: John W. Stinson Irma Carson For: Alan Tandy, City Manager Harold Hanson AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, August 22, 2005 · 10:00 a.m. City Manager's Conference Room - City Hall i 1 ROLL CALL i · Called to Order at 10:05 a.m. Present: Councilmembers Mike Maggard, Chair; Harold Hanson; and Irma Carson 2. ADOPT JULY 11, 2005 AGENDA SUMMARY REPORT Adopted as submitted. 3. PUBLIC STATEMENTS 4. DEFERRED BUSINESS A. Review and Committee recommendation on Fire Station design Fire Chief Ron Fraze explained the fire station design was referred to the Committee by Committee Member Hanson to make sure the new fire station would be built in the most economical way possible. The station will be a four-person fire station with a police substation located on E. White Lane east of Union Avenue. Ms. Klm Bobic, Project Manager for RRM Design Group, provided a brief overview of the building design work plan. The plan is to use durable, long-lasting quality materials, but keep the design very basic in order to deliver the project at the lowest possible cost. It was noted that in the last three or four years since the fire station was budgeted, construction costs and the cost of Steel have continuing to rise. The plan at this time is to put the construction of the station out to bid in February 2006. The Central Police Satellite Office location is being leased, so there will be savings when the office is moved to the new location as part of the new Fire Station and the lease is eliminated. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Monday, August 22, 2005 Page - 2 - Committee Member Carson requested a list of developers in the area that could be contacted that may contribute to the aesthetics on the outside of the station to make it attractive, similarly to how Castle and Cooke contributed to Fire Station No. 15 in the southwest to enhance the outside facade to fit in with the surrounding subdivisions. ' Committee Chair Maggard spoke about using prototype designs for fire stations in the future in order to save architectural fees. The Committee took no further action. 5. NEW BUSINESS A. Staff report and Committee recommendation on the request for funding from the Bakersfield Museum of Art Assistant City Manager John Stinson provided 'an overview of the memorandum and Council Policy on funding nonprofits, which was included in the Committee packet. The Bakersfield MuSeum had requested a contribution of $40,000. The historic contribution to the Museum before the State budget crisis was $25,000 per year. Staff recommended if the Committee decides to fund a contribution to the Museum this fiscal year, it be in the amount of $25,000. Bernard Herman, Executive Director of the Bakersfield Museum of Art, spoke in appreciation of the City's support over the years and the value of the programs they provide to the children and the community. David Gordon, Bakersfield Museum of Art, expressed appreciation for the City's support in the past and explained the Museum's funding needs and programs. Committee Member Hanson spoke in support of supporting the arts and the Museum. Committee Chair Maggard expressed support for the Museum and suggested next year perhaps the Museum could request a contribution for a one-time special event at the Museum in addition to a contribution. Committee Member Carson spoke regarding the quality of the programs at the Museum and made a motion to fund a contribution to the Bakersfield Museum of Art for $25,000. The Committee unanimously agreed and requested staff to forward the Committee's recommendation to the Council. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Monday, August 22, 2005 Page - 3 - B. Staff report and Committee recommendation on the sale of the City Farm City Manager Alan Tandy explained staff brought to him the concept that it may be possible to sell 1,280 surplus acres of City property commonly known as the 5,000 acre .southeast farm, which could be an opportunity to generate funds without taxes or fees. It is premature to start talking about projects that might be funded if a gain is realized. This would be a very complex process, which may or may not be possible and the amount of proceeds available from such a sale is not known at this time. The City Manager provided an overview of the draft administrative report and memorandum of understanding included in the Committee packet. He exPlained staff has attempted to provide a format to present to the Committee and Council and a process for going through the procedures and the steps necessary to find out if there is opportunity for economic advantage through the sale of the surplus farmland. Staff is proposing a contingent purchase of the land by the Redevelopment Agency from the City. A unique opportunity exists for redevelopment of this property through a joint venture between the City and the Redevelopment Agency. This proposed venture will have a set of conditions as outline in the draft administrative report. The Redevelopment Agency will need to take the necessary steps to have the property legally entitled. Requests for proposals and developer qualifications will be sent to the 14 interested parties by the Redevelopment Agency and a developer and development plan would need to be selected. The necessary steps, timing and the process are very complex and will take a minimum of one year and perhaps longer. The City cannot just sell the farm property and move off of it. There will need to be a simultaneous offset of the impacts on the Wastewater Fund for taking the farmland. That will either require acquisition of replacement land or installation of tertiary treatment and will require authorization of the State Regulatory Agency. It may require plumbing to get the tertiary treated wastewater to a purchaser and requires a buyer for the treated wastewater. Whether the City goes with the land replacement or the treatment costs, there are significant factors and it may not be profitable, but staff felt it was worth exploring. The Committee requested changes to clarify the wording in the memorandum of understanding and to bring it back to the Committee. Committee Chair Maggard made a motion to set a special Committee meeting in order to place the sale of the surplus acreage of the City farm property on the September 7th Council Agenda. With Council approval, this item could then be placed on the September 12th Redevelopment Agency agenda. The Committee unanimously approved the motion and requested staff to set the meeting. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Monday, August 22, 2005 Page - 4 - C. Staff report and Committee recommendation on potential sale of the City Airport This item was referred by Councilmember Carson due to recent interest in the airport property and the potential for economic development. City .Manager Alan Tandy provided an overview of the memorandum and information included in the Committee packet. On several, occasions over the past several years the City has attempted to close the airport. These attempts were primarily for safety considerations. The airport is not traffic controlled and in the past there were complaints from Meadows Field regarding flights leaving the airport. On at least four occasions, the City petitioned the Federal Aviation Administration with requests to close the airport. Those requests were denied citing the condition that all of the State and Federal Grants received for the airport would have to be paid back. At the time of these requests, the economics were different and land values were non-existent to cover repayment of the grants. Due to the appreciation of land values and new development interest in southeast Bakersfield, there have been inquiries regarding the possibility of buying the airport property. The airport covers 251.88 acres. If a buyer would be willing to pay the City for the costs for closing the airport, that would provide a different format to request a closure from the Federal Aviation Administration. The Federal Aviation Administration theoretically could waive the back debt, depreciate the back debt, or even with full reimbursement not give permission to close the airport in the interest of Civil aviation. 'The current break even cost is $16,035,909. This figure includes the repayment of grants for a total of $12,835,909; the City's investment of funds for various projects of approximately $200,000; and a current estimated cost of $3,000,000 to relocate and buyout of lease holders at the airport. There may be another expense to consider. Contamination.from a fueling facility exists on the property. The City met all environmental requirements and was allowed to cap the contaminated area with asphalt. Another type of development may require further remediation. The above costs are breakeven and do not include any profit for ,the City. There may be resistance to the City's selling the airport. The current tenants may not want the airport to close and cite the economic value of the airport to businesses. Also, there is a national group that opposes any closures of airports. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Monday, August 22, 2005 Page - 5 - Committee-Member Carson explained this is a one-time opportunity to get out of a continuing debt and the need to continue to accept grants for a fa~cility that has not been economically sound for the City. Also, the possible sale would provide an economic opportunity for the area to overcome one of the most blighted areas in the City. There are needs for schools, parks, affordable housing, sidewalks, and 'the opportunity for commercial mixed use to provide jobs in the area. She requested that the Committee and Council consider the possible sale and explore if it-would be economically feasible and also to make sure any purchase covers the costs associated to relocate the current tenants. John Harmon, Harmon Rocket, and a tenant of the airport, spoke in support of the airport and the airport restaurant and in opposition to the closure of the airport. Christina 'Phillips, with Harm°n Rocket Company, spoke in support of the restaurant and in opposition to the closure of the airport. Shane Ellis, Kern Charter Service, spoke in support of the' airport and in opposition to its closure. Harry Hackney, an airport tenant and caretaker, spoke in opposition to the closure of the airport. Committee Member Hanson agreed that it would be worthwhile to explore the. possibility. But expressed there are many unknowns such as, how the Federal Aviation Administration will respond, what the purchase price should be, soil contamination and cleanup costs. Before the. Committee 'makes a recommendation; there needs to be more facts available. committee Chair Maggard was in support of exploring the sale of the airport, but would like to explore the possibility of building a replacement airport farther out. Committee Member Carson made a motion that the Committee set a 45-day time frame for interested buyers to submit letters of intent to the City Manager with bona fide .proposals acceptable to the City Manager and come back to the Committee for further recommendation. The Committee unanimously approved. D. Staff report and Committee recommendation on the Independent Auditor's Report on Transportation Development Act Funds for Fiscal Years Ended June 30, 2004 and 2003 Assistant Public Works Director Jack LaRochelle explained the Transportation Development Act Funds covered in the audit are non-motorized vehicle funds such as for the bike path. These are Kern COG funds spent in the City. The audit had a clear opinion with no reservations or exceptions. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Monday, August 22, 2005 Page - 6 - Committee Member Hanson,made a motion to accept the Auditor's Report. The Committee unanimously approved the motion. 6. COMMI'I-rEE COMMENTS 7. ADJOURNMENT The meeting adjourned at 1:00 p.m. Attendance: Staff: City Manager Alan Tandy; Assistant City. Manager John W. Stinson; Assistant City Manager Alan Christensen; City Attorney Ginny Gennaro; Finance Director Nelson Smith; Fire Chief Ron Fraze; Assistant Public Works Director Jack LaRochelle; Economic Development Director Donna Kunz; Development Services Director Stan GradY; Assistant to the City Manager Darnell Haynes; Public Works Operations Manager Brad Underwood; Real Property Manager Don Anderson; Deputy Fire Chief Kirk Blair; ED/CD Business Manager Rhonda Barnhard; General Services Superintendent. Steve Hollingsworth; Office Administrator/Public Relations Coordinator Rhonda Smiley; Police Captain Tim Taylor; and Wastewater Engineer II Art Chianello Others: Mark Howell, KUZZ/KCWR; James BUrger, The Bakersfield Californian; Jim Scott, Channel 17; TV cameraman; HarrY Hackney, airport tenant; Shane E. Ellis, Kern Charter Service; Kim Bobic, RRM Design Group; Mike Scott, RRM Design Group; Rogers Branson, Bernard Herman, David Gordon, and SherYl Barbich, Bakersfield Museum of Art; Christina Phillips, Harmon Rocket, LLC; and John Harmon, Harmon Rocket LLC cc: Honorable Mayor and City Council S:~lOHN\Council Committees\05Budget&Finance~f05aug22summary.doc