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Home My WebLink About2002.T:.O: 'H0~0rable ~y0['aridCityCOun~i! APPROVED FROM: John~:W.~'Stinson,~Ass!Stant,Ci~. Manager DEPARTMENT HEAD~ DATE: December4, 2002 CITY MANAGER SUBJECT: Budget and Finance *Committee-Report ~,no. 3~02 regaY/ding the,~,pr0posed increase in Kemceunty Solid.waste Man~agement Pro{;Iram fees~ RECOMMENDATION: Committee: rlecommends approval:otthe 'rePort. BACKGROUN D: The BUdget and ~Finance CommitteeoftheBakersfield;City,Council *meti~th County~ staff,on December 2. 2002 ~to :of p~seddate fer rate pr°p~sal 'wo~ld increase ~solid'~Ste~fees b~ '~itY residents and ~busin~esses,~ ~ ~": ' ~,, ~, ' ,. :,, "-"i' ~ ,'~ . · '~ ' ' ~ ..... i~,~ : ~"' The Budgef land Finance'. commAee~ha~ several!COncBrns I 'fee: inc~e~ and · the attached ie~e'r~, Duei~ .was sent t0 the, Bdard by' the , Pr0P'.~ ed rates,; BUdget':and Finan~e lc°mm directed thedetter: be ise~t imm~iatelY 'since :the;~CitYCoun¢ii's ne~' meetilng wa's°~i, DeCember ~' "after the P~btic hearing. ' ~ 'The: Committee ~0[ ;;the December 4, 2002 Kern County Board of Supervisors 1115 Truxtun Avenue Bakersfield, CA 93301 Honorable Chairman and Members of the Board: The Budget and Finance Committee of the Bakersfield City Council met with County staff on December 2, 2002 to review the proposed increases and changes to Solid Waste fees proposed by the County staff. The Committee has several serious concerns regarding the proposed increase and changes which are summarized below: 1. Cities and the Board of Supervisors need more time for input. There is insufficient time for the City of Bakersfield policy makers and those from other cities to review and make comments on the proposed rate increases and changes prior to the proposed adoption date by the County. Adopting the new fees on December 10th does not provide sufficient time for adequate city input, much less, time for the two newest Supervisors to become fully informed of the implications of this important issue. This matter should be delayed to allow for additional study. The City Council of Bakersfield, for example, does not meet until December 11th. The day after the County staff proposes that a $1.6 million rate increase to City residents be adopted. 2. The land use fee increase is too severe and should be phased in and/or moderated. The approximately 15% increase to residential customers is very severe and consideration should be made to moderate or phase in this increase if needed, over several years. The elderly and people on fixed incomes will have trouble bearing the cost of $750~000 in the City of Bakersfield alone. Your Board should take input from the Kern County City Manager's Association on belt tightening ideas. 3. The flat rate structure is inequitable to cities who recycle. The proposed rate structure does not address the inequity caused by billing all customers the same, regardless of their efforts to recycle or divert waste. This flat rate approach disadvantages those cities who have implemented significant recycling or green waste programs. Kern County Board of Supervisors December 4, 2002 Page - 2- 4. The commercial rate chanqes are too severe and should be phased in. The adjustment proposed to commercial tonnage rates will cause a 24% increase in the per ton cost for commercial users in the City of Bakersfield and the City of Taft while there will be a 5% decrease in commercial bin rates for others. This seems an extremely severe adjustment to make in one fiscal period and if the change is indeed warranted, consideration should be given to phasing in this change over say three to five years so budgetary adjustments can be reasonably made. The cost to Bakersfield business for this rate increase is $900,000. That will impose a serious hardship on many of our businesses. 5. City residents should not pay for non-city recyclinq and qreen waste proqrams. Due to the pooled revenue approach used by the County, funds collected from city property owners in the land use fee and landfill fees are being used to pay for green waste and other recycling costs which are for non-city residents. This means that city residents pay for city programs and for a share of non-city programs, therefore paying twice. This inequity needs to be addressed. 6. City Residents should not pay for non-city landfill closure costs. Similar to the previous item, the county intends to use pooled funds to pay for the non-city share approximately ($4 Million) of the Bakersfield landfill closure. Again city residents are paying their share of the closure costs and a portion of the non- city share of these costs. Again, paying twice. 7. City Residents should not pay for non-city operational costs. County exclusive costs (such as those for Green waste programs, administration of the haulers in the unincorporated areas and illegal dumping programs) have been paid for out of pooled or blended revenues for many years. Since 1994 it is estimated by city staff that at least $1.7 Million was paid by City residents for non-city costs. This practice should not be permitted to continue. 8. The City has worked with the County in the past to fairly apply costs. We would like similar fair treatment. The City of Bakersfield has been very generous by allowing the County to pay a break even rate to utilize city sewer plant capacity (CSA 71, Rexland Acres, etc.) and now they are asking us to pay for many things on top of a pure capacity basis for use of the county landfill. 9. State Water Board requirements were reduced. Why is there no reduction in fees? County staff originally recommended an increase to $64 in the land use fee and $34 per ton. They later indicated that an additional $2 increase in the land use fee and a $2 increase in the per ton fee was necessary due to requirements of the Regional Water Quality Control Board for a double liner at the Shafter-Wasco and other County landfills. It is our understanding that the Regional Water Quality Control Board with Vice Mayor Mark Salvaggio voting on your behalf has reduced some of the requirements to the benefit of the County. These regulatory changes which should reduce the need for additional funds are not reflected in the proposed rates. Kern County Board of Supervisors December 4, 2002 Page - 3 - The Budget and Finance Committee is sending this letter to the Board of Supervisors since the City Council's next meeting is on December 11th which is after the public hearing scheduled on this matter. These issues are of such concern it was important for us to communicate with the Board prior to our Council meeting. We expect that the other members of the Bakersfield City Council as well as many Kern County cities will share these concerns. Representatives from other cities have met with our staff and indicated they too would appreciate additional opportunities for input and review of these proposals. We appreciate your consideration of these concerns and request that the proposed fee increase and changes be delayed until the issues presented can be fully reviewed and addressed. Respectfully, Mike Maggard, Budget and Finance Committee Chairman Mark Salvaggio, Vice Mayor Harold Hanson, Councilmember cc. Honorable Mayor and Members of the City Council NOTICE 'OF HEARING Questions About I~and Use Fees DECEMBER t0, 2002 ~/'hat do land use fees pay for? The County operates and maintains a solid'waste system consisting NOTICE IS HEREBY GIVEN that on the 10th day of December 2002, at of landfills, transfer stations and recycling programs. The land use 2:00 p.m. in the Board of Supe~/isors Chambers, Kern County fee is paid by all owners of residential property in Kern County Administrative Center, 1115 Tmxtun Avenue, First Floor, Bakersfield, to pay for their proportional share of'the system. Residential waste Califomia, the Board of Supervisors will conduct a public hearing on the (ordinary household trash) may be disposed or recycled at the proposal to adjust the Solid Waste Management Program Service Charges for 2003-2004. 'These charges are the Land Use Fees that are County's solid waste system without paying additional tees. charged to all residential parcels for the operation of the County's solid waste system.. At said time the Board shall hear and consider all objections and protests, if any, to said adjustments .to the fees. N~'hat is not covered by land use fees? This is not a new fee. Solid Waste Land Use Fees have been in place All business waste. Also, waste such as tires, cars, boats, camper since 1988 and collected at the same time and manner as general shells, dead animals, construction and demolition material, as well County taxes since 1989. The last adjustment to the land use fees was as other items, from all sou~;ces is not ordinary household trash. in 1990. For the last 12 years,.the fees have been $57.00 per unit per These are charged a gate fee if disposed of'in the landfill, year for one to four unit residential parcels or $45.60 per unit per year for a five or more unit residential parcel. To provide for increased costs of operating the solid waste system, the County is proposing to raise the land use fee to $66.00 per unit per year for one to four unit parcels and H/'hy does the County need a fee increase? $53.00 per unit per year for a five or more unit parcel. Not many businesses could go 12 years without raising prices. Yet, the Waste Management Department has done just that. The Assuming the adjustment is approved, it will take effect July 1, 2003. If Consumer Price Index has gone up 38% since the last fee increase, written protest against the proposed fee is Presented by a majodty of the and the County has absorbed additional costs due to new owners of residential property in Kern County, the fee adjustment will not be made and the fees will continue at the current rate. regulations and mandated recycling programs. Since 1990, compliance with recycling, environmental monitoring and closure If you have questions regarding this notice, please call the Kem requirements has resulted in additional costs of 5 to 6 million County Waste Management Department at (661) 862-8889. A dollars per year. A major increase in the cost of landfill operations complete copy of the proposed ordinance and the report prepared by the Waste Management Department describing the fee and the was caused by the increase in prevailing wages in 2000, resulting parcels affected by the proposed increase are on file with the Clerk in additional costs o£ almost one million dollars per year. Recent of the Board of Supervisors, Stn FloOr, 1115 Truxtun Avenue, changes to regulato~' compliance requirements for construction of Bakersfield, Califomia and are available for inspection during landfill liners are projected to nearly double the current cost of' normal business hours, liner construction. In fiscal year 2001-2002 waste system expenses ALL INTERESTED PARTIES MAY ATTEND AND BE HEARD BY THE exceeded revenue by approximately 14%, and without a fee BOARD OF SUPERVISORS AT THE PLACE AND TIME INDICATED increase this annual budget shortfall will continue to increase. ABOVE. IF UNABLE TO ATTEND, YOU MAY FILE A WRITTEN RESPONSE WITH THE CLERK OF THE BOARD, BOARD OF SUPERVISORS, 1115 TRUXTUN AVENUE, BAKERSFIELD, CA 93301 PRIOR TO THE TIME SET FOR HEARING. Solid Waste System Fee Increase Effective July 1, 2003 Public Hearing December 10, 2002· 2:00 p.m. 1115 TrUxtun Avenue ' Bakersfield DRAFT .BAKERSFIELD · ~[/~'~~ '. Mi ke Maggard, Chair Aldn Tandy (~ity Mane~ Harold Hanson Staff: Darnell W. Haynes Mark Salvaggio AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMI'i'I'EE MEETING Thursday, November 14, 2002 City Manager's Conference Room - City Hall 1501 Truxtun Avenue, Bakersfield, CA 1... ROLL CALL Called to Order at 4:00 p.m. Present: Councilmembers Mike Maggard, Chair; Harold Hanson and Mark Salvaggio 2. ADOPT OCTOBER 10, 2002 AGENDA SUMMARY REPORT Adopted as submitted. 3. PUBLIC STATEMENTS 4. DEFERRED BUSINESS A. Staff report and Committee recommendation regarding Park Development Fee Georgina Lorenzi, Assistant to the Public Works Director, reported staff met With Brian Todd, Executive Vice President of the BIA, and came to agreement on the Park Development Fee increase. Staff agreed with Mr. Todd's request to use the Construction Cost Index instead of the Consumer Price Index and that the fee adjustment is to be based upon the annual averages for calendar years 2001 and 2000. Based upon this index, staff recommended a 1.95% increase to the Park. Development Fee. This would increase the' current fee of $635 per new single family unit to $647. AGENDA SUMMARY REPORT Thursday, November 14, 2002 Page - 2 - Brian Todd, Executive Vice President of the BIA of Kern County, spoke regarding agreement on the fee increase. The BIA also agreed to table their issue of applying a credit to the Park Development Fee for what they philosophically, believe to be new development's share of the recent Park bond grants. City staff has a fundamentally different view on the use .of the Park Bond grants. Recent voter-approved propositions have provided grant funds for local recreation and park projects; however, they are being used for enhancements beyond basic park facilities and are distinct from those provided by the Park Development Fee. The bond grants are one-time funds with special requirements that cannot be relied upon for basiC park development. The bond funds are currently being used for recreational facilities (such as the Kern River Parkway new 32-acre park, aquatics and ice complex, etc.) which serve all residents and enhance the livability of the community. Public Works and Recreation and Parks staff will be meeting with Mr. Todd and the BIA board in the future to discuss the issue of what amenities should be included in a basic 10-acre park with a review of costs for those amenities. Committee Member Salvaggio made a motion to approve the 1.95% .Park Development Fee increase. The Committee unanimously approved. Staff will forward a resolution approving and adopting an adjusted fee for the development and improvement of parks within the City of Bakersfield to the City Council. 5, NEW BUSINESS A. Staff report and Committee recommendation regarding .request for additional funding for the Bakersfield Senior Center/Retirement Housing ~nc, senior housing project Economic Development Director Donna Kunz reported on the progress of the Senior Housing project over the last 18 months since the project received its financing award from HUD for a 202 Capital Advance in the amount of $6,670,500. In recent weeks design and engineering work has been completed and a contractor, S.C. Anderson, was selected to construct the project. When the construction estimates were completed, there was a shortfall of funding in the amount of $676,072. A letter was received by the City requesting additional assistance. November 30th is the official deadline given by HUD for the developer to close the escrow on the property required for the project and finalize the 202 advance. If this is not accomplished, HUD has indicated that the 202 funding ($6,670,500) will be canceled. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE MEETING Thursday, November 14, 2002 Page - 3 - Staff met with the developer, the 'contractor and the Bakersfield Senior Center to reevaluate costs to try to work out a financing plan in which all parties contributed to eliminate the shortfall. The developer had $153,439 special contingency that was in the line items and because the construction estimates were so fresh and agreed upon, everyone was comfortable with a smaller amount in the HUD 202 requirement for contingency, so the $153,439 can be use 'to help fill the funding gap. The Bakersfield Senior Center and the developer have agreed on a lower price for the land, which provided $31,000. Construction value engineering costs Were reevaluated and $11,633 was identified and Retirement Housing Inc. provided a cash contribution of $120,000. This leaves a net shortfall remaining of $360,000. Economic/Community Development staff .audited, reconciled and closed out all of the old completed HOME projects resulting in available funds of $215,000. In addition, $145,000 of HOME funds is available from a housing project at Union and 4th, which was a mixed use, multi-family project that is moving along without a request for the HOME funds. They already have a contractor and do not want to go through the HUD requirements. Using these two sources of funds will not impact other Citycommitments. It was discussed although this project received a HUD 202 capital grant for construction costs, the HUD 202 program does not cover all costs associated with this type of project and it is quite common that other monies are needed. Economic Development Director Donna Kunz expressed this project is too valuable to just stop at this point. It is a $6.7 million capital grant, structured as a 40-year loan, but it is forgiven at the end of the 40 years. Therefore, staff recommended approval of 'the additional funds of $360,000 to the Bakersfield Senior Center Affordable Housing Project from the identified HOME sources. Richard Washington, Vice President of Business Development for the Retirement Housing Foundation, spoke and answered questions about the project. Committee Member Hanson made a motion to recommend to the City Council approval of additional HOME funds of $360,000 to the Bakersfield Senior Center Affordable Housing Project. The Committee unanimously approved the motion. Staff will forward the amendment to the agreement to the City Council. 6. COMMITTEE COMMENTS 7. ADJOURNMENT The meeting adjourned at 4:49 p.m. AGENDA SUMMARY REPORT BUDGEI' AND FINANCE COMMIIIEE MEETING Thursday,Page - 4 -N°vember 14, 2002 DRAFT Attendance staff: Assistant City Manager John W. Stinson; City Attorney Bart Thiltgen; Assistant City Manager Alan Christensen; Assistant to the City Manager Darnell Haynes; Assistant to the Public Works Director Georgina Lorenzi; Economic Development Director Donna Kunz; Community Development CoordinatOr George Gonzales; and Recreation and Parks Supervisor Ken Trone Other attendees: Brian Todd, BIA of Kern County; Reporter James Burger, The Bakersfield Californian; Reporter Peter J. Rudy, KUZZ; Brian Jeter, Reba West, Polly Warren, Alvin and Gina McClellan for the Bakersfield Senior Center; Richard Washington and Joanne Yokata from the Retirement Housing Foundation cc: Honorable Mayor and City Council S:\Darnell\02Budget and Finance\02nov14summary Discussion Points for Proposed Kern County*Landfill Fee Increase The Kern County Waste Management Department is proposing to increase countywide landfill fees in July 2003. Public hearings for commercial and residential landfill fees are scheduled for 2 pm on Tuesday, December 10, 2002. The County first announced a proposed rate increase on September 18"', following it with a higher proposed rate increase on October 8"'. Prior to the County's September 18th announcement of the plan, the City of Bakersfield was under the impression that no fee increase was planned this year, per a discussion with the County's fee consultant on July 10"~. The possibility of a landfill rate increase had been mentioned to the Solid Waste Advisory Committee (SWMAC), but no fee recommendation was requested or issued from that advisory group. During several metro area subcommittee (Ad Hoc) meetings, the County expressed that a single digit rate increase may be phased in. However, no final recommendation was issued by the Ad Hoc committee. The Ad Hoc process was ended in August, with no report to SWMAC. Thus, it appears the County is moving quickly and unilaterally to implement a fee increase with little consideration of the stakeholders. Listed below are some key points to consider: 1. The Count has not rovided for stakeholder review of the rates, A review of the rate calculations, and the gross increase in revenues, should be shared for review and discussion. 2. The Count has not demonstrated the need a fee increase at this time. The County Waste Management Department budget shows an $8.5 million unreserved fund balance. For an annual budget of $24 million, this is significant. Is a fee increase really necessary this year? 3. ?he County will raise fees without a fair fundinq plan. The County does not have a proper funding source to pay for its share of recycling programs, so it charges extra for landfill fees. Cities pay for their own recycling, yet County area programs are funded by mixed City/County funds, resulting in higher landfill fees. The proposed fee increase ignores this problem. The problem should be corrected prior to adjustment of the fees. 4. The Count will raise residential fees and avoid ivin credit for reducin landfill use. There is no economic incentive to recycle residential waste. The County keeps all of the revenue from land use fees, regardless of landfill space and cost savings. Fair credits for residential recycling programs are needed. County fees originally included the cost of greenwaste handling, for example, but no credit is earned for recycling greenwaste. 5. The cities of Bakersfield and Taft will a 24% more for Commercial refuse while other areas will a less. Bakersfield and its businesses will a over 900000 extra to boost the Coun's landfill bud et be ond its .current $8.5 million balance. County staff states that the fees-need to be "re-normed" due to changes over the years. If the fees are in fact so uneven, the correction should be phased in to avoid economic shock. Cities should not bear the burden of the County's failure to perform the required annual study. Also, the proposed numbers may be skewed by differing weights in each jurisdiction. The County should share the study and provide an opportunity for comment by the stakeholders. RECI=']:VI~O:a, 11/13/O2 ?:15PM; ->CI'Ty OF BAKERSFI'ELO; #752; PAGE 2 ~'- 13./13/2002 3.8:).B ~3.B628905 1~4D PAGE 02107 K[R I (OlJltl Altl6r [ltT D[PARTH[ltT Daphne H. Washington, Oimctor 2700 'M' b'treet, Suite 500 Bakersfield. CA 9330t-2370 (661) 862-8900 (800) $52-KERN (option 6) Fax: (661) 862-8901 November 13, 2002 htt~:#ww~.co.kem.ca.u~md/wm~.h~ VIA FACSIMILE & FIRST CLASS-,MAIL City of Bakersfield City Manager's Office Attn: Alan Tandy 1501 Truxtun Avenue Bakersfield, CA 93301 Dear Mr. Tandy: SUBJECT: Proposed Landfill Fee Increase Thank you for your letter of November 1, 2002 commenting on the proposed adjustments to the waste *disposal fees in Kern County. We appreciate your concerns, and are committed to working with the City of Bakersfield to create a fee structure that is as fair and equitable as possible. However, many of the objections to the fee proposal contained iq your letter appear to be based on an inaccurate understanding of our current and proposed fee structure. We are providing you with a fairly lengthy, two-part response to your letter so that you will be better informed as to the basis of the fee proposal and, once armed with this information, hopefully better able to constructively comment on our recommendations. Part One of this letter will provide you with an overall framework for understanding the structure of our fee recommendation. Part Two of the letter will respond directlY to your specific comments. PART ONE: FEE STRUC. TU, Rr: The Kem County Waste Management Department is committed to the operation of a fair and efficient solid waste disposal system. Consistent with that commitment, we have made numerous changes in our operations over the .last decade to reduce waste disposal costs and. to contain the costs, as much as possible, for State and Federal environmental regulations. As a result of this work, waste disposal fees have not increased in the County of Kern since 1990. We do have a unique land use fee/bin fee/gate fee system in Kern County, which is designed to simultaneously reduce incentives for residential illegal dumping and create incentives for commercial waste diversion. This system has served the County of Kern and City of Bakersfield well, as both jurisdictions are meeting State waste diversion mandates while maintaining waste disposal fees well below statewide norms. Winner of local, state and national awards for 'innovation and eft/c/ency. RECt:::ZVEO; 11/1~,/O:~ ?':II'PM; ->CZTY OF' BAKERSF'ZELO; #752; PAGE ;3 '~. ~.1./],3/2002 ~.B: ].B 6S~.~)S2l~905 NH]) P~E 03/07 City of Bakers~ld Page 2 November 13, 2002 This system is not perfect, as it incorporates an inherent trade-off as follows: fiat land use fees, paid by residential property owners, eliminate financial incentives to illegally dump waste since residential waste disposal is not charged at the landfill. Conversely, the fiat nature of these fees limit the financial rewards, of increased residential waste diversion by all local jurisdictions mandated to increase waste diversion (all Kern County cities and the County off'Kern). All of these jurisdictions, therefore, are challenged to meet State diversion requirements at the lowest cost possible - and most have successfully met this challenge without significant waste collection rate increases. The current land use/bin/gate fees were designed to charge equivalent amounts per ton of waste disposed ($29.00 per ton) regardless of whether a rate payer paid via the land use -fee, bin disposal fee or at' the landfill gate. Over the course of a decade, however, waste disposal patterns have changed. Thus, our proposed fee adjustment is designed to accomplish two primary financial goals: 1. Increase the fee per ton to an amount sufficient to cover projected waste disposal costs for the next decade. 2. Re-norm the fee so that the same amount per ton is charged to everyone disposing of waste in Kern County, regardless of whether they pay that fee via the .land use fee, gate fee or bin disposal charge. As a part of our analysis of the current rate structure, we did identify several inappropriate ~cross-subsidies' that result from the County's practice of pooling land use fees (primarily residential) and bin/gate fees (primarily commercial) in one solid waste enterprise fund. Thus, the funding for both unincorporated illegal dumping clean Up and franchise system administration is recommended for elimination from the solid waste fund to resolve this issue for most jurisdictions. The green waste facility at Mount Vernon, however, is still funded from pooled revenues. We have met with the City's Solid Waste Services staff on numerous occasions in an attempt to develop a workable alternative for funding the Mount Vernon operation. To date, one has not been identified but we are committed to a continued joint effort to improve the financial equity of that operation. As discussed above, our fees were originally designed to charge the same amount per ton regardless of payment method. Over time, due to the imposition of commercial gate fees, the rate of commercial waste diversion has increased. However, the original bin disposal fees were left. unchanged. Thus, on a per ton-basis, commercial bin rate payers are currently paying too much per ton and that is why our fee recommendation reduces the bin disposal fees. It appears that the City identified this inequity in June 2000 and, to reduce waste disposal costs, switched payment methods from a volume (bin disposal fee) to a tonnage (gate fee) basis. So,. now that we are re-norming all of the fees, the City's disposal costs may increase more than other jurisdictions. In fact, however, all rate payers and all RE~;VEI3:.~ 11/1:3/~O2 7:lePM; ->CI'Ty OF BAKERSFTELD; #?S2; PAGE 4 '~ [1/[312002 'tS: 18 6G18828905 . NMD PAGE 84/07 ,; City of Bakersfield Page 3 November f3, 2002 jurisdictions pay the same amount per disposed ton in our proposal. The City's costs appear to be increasing more than costs in other jurisdictions - not because you are being charged more than others, but because the City is losing the artificial discount it enjoyed-relative to other cities due to your shift to gate fees as a temporarily cheaper method to pay your disposal charges. Fee systems are often complex. A balance .between accuracy and ease of administration is always struCk at some level. Our cun'ent-fee structure, and the proposed fee structure, both strike that balance appropriately. Based on currently available data, we have proposed setting the fee in a manner equitable .for all jurisdictions and all rate payers. It has the .potential to have a more significant impact on the City of Bakersfield than some other jurisdictions because of decisions you have made in the past relative to your own fee Structure and operating practices. There may still be some cross-jurisdictional subsidy problems with the way the Mount Vernon ~facility is financed. We are committed to resolving those issues, but not to the detriment of the effective, fair system we have developed and operated in Kern County for a number of years. P_ART TWO: SPECIFIC RESPONSES "The County's proposed landfill fee increase appears to impact'the City of Bakersfield more severely than other landfill users. We do not support the proposal, which:' City's Position - 'Lowers commercial fees 5% in the County and other cities, while raising fees for Bakersfield and Taft;" County's Response - The solid waste fees are the same in all parts of the County and do not vary by city. The proposed gate fee for commercial waste is $36.00 per ton and the proposed bin disposal fee for commercial waste is $1.90 per cubic yard. These fees will apply in all areas of the County and in all cities in the County. The City of Bakersfield and the City of Taft chose to pay gate fees for the commercial waste they dispose in the County's system. Presumably, they chose the gate fee payment method to take advantage of an emerging inequity between the gate fee and the bin disposal fee. The County's proposed fee adjustment was designed to correct the inequity between the gate fee per ton and the bin disposal fee per cubic yard. The County has very carefully balanced the amount of the land use fee, the gate fee and the bin disposal fee to ensure that each payment method charges an equivalent amount on a per ton basis. If the City of Bakersfield would prefer to switch back to paying the bin disposal fee, please let us know. We can cancel the City's current agreement to pay gate fees. City's Position - "Raises residential fee by $9 per year, or 15.8%, in spite of our reduced use of landfills. The plan fails to relate residential fees to the amount disposed, as required by State law. It does not give credit to communities for effecb've greenwaste recycling programs. County's Response - As discussed above, the County has gone to great lengths to ensure the land use fee, gate fee and bin disposal fee are in balance on a cost per ton RECIE/:VEO:~ 11/1:~/02 7:17PM; ->CT'Fy OI=' BAKERSFT'ELO; #752,- PAGE 5 '~' ii/13/2002 18:18 6618628~05 WMD PAGE 85/07 City of Bakersfield Page 4 November 13, 2002 basis, county-wide. The amount of residential solid waste disposed by any one community or any one residential parcel may be slightly more or less than the county- wide average. The method of rate calculation is used by almost all cities and counties, and complies with applicable State laws. It is fundamentally no different than the average fee the City of Bakersfield charges for refuse collection, sewer fees or any number of other fees. If it is inappropriate for the County to average waste disposal charges across similar residential property, then it is certainly inappropriate for the City to charge all residents the same waste collection fee. The same logic that argues against the cost and complexity of a variable can rate or variable sewer rate in the City applies to the County land use fee structure as well. The land use fee is not perfect, in that its flat rate nature does not create the same individual diversion incentives that commercial gate fees produce - but the Kern County community has made aconscious decision to accept these weaknesses as the cost of a system designed to minimize residential illegal dumping. It is also important to remember that every County recycling program is also available to city residents and each city receives waste diversion credit from these County programs. City's Position - 'Raises Bakersfieid's commercial fees by $7 per ton, or 24.1%. The City and a small group of businesses will pay over $900,000 per year mom, while businesses outside the City will receive a discount." County's Response - Again, the County's fees are .the same in all parts of the County and in all cities. Businesses outside the City of Bakersfield will be charged the same fees that apply within.the City of Bakersfield. The City of Bakersfield can choose to pay either the gate fee or the bin disposal fee, and either of those fees is the same throughout the County. City's Position - "Continues the practice of funding County-only program costs with revenue from City businesses and residents.~ County's Response - The County worked with City of.Bakersfield staff to identify the County-only programs that were of concern. The two County-only programs that were identified were illegal dumping dean-up and franchise hauler administration costs. The Waste Management Department no longer .operates an illegal dumping cleanup program and the Department has recommended that franchise hauler administration costs be included in the upcoming fee adjustment, thereby eliminating any city participation in that program. City's Position - "The proposed fee increase appears to balance the County's landfill budget on the City of Bakersfield. The proposed fee increase appears to collect the rnajorfty of the County's new revenue from the City of Bakersfield, as opposed [o other areas. coUnty's Response - The proposed land use fees, gate fee and bin disposal fees were carefully structured to collect the same amount of revenue from-all rate payers on a cost 11/13/02 7:17PM; -~CZTY OF BAKERSFZELD; #752; PAGE 6 [[~i3/2002 i8:18 GGiBG28~05 k~D P~E 0G/07 City of Bakersfield Page 5 November 13. 2002 per ton basis. The amount of revenue the County~expects to receive from any part of Kern County, or any city, is $36.00 per ton, The method of payment will be either via the land use fee ~per year, the gate fee per ton or the bin disposal fee per cubic yard of bin volume. Regardless of the payment method, the County expects to produce an equivalent amount of revenue per ton disposed, .based on a County-wide average. The County did not target the City of Bakersfield or any other jurisdiction to "balance its budget." City's-Position- 'Furthermore, it hurts residents of communities who help the County,'de system with their recycling efforts. Bakersfield should not be penalized for recycling. Historically, the County has included the cost of greenwaste disposal in landfill fees. Bakersfield 'has removed greenwaste from both commercial and residential disposal. Charging Bakersfield according to 'averages' from other areas fails to account for this. County's Response -The City of Bakersfield does not accept green waste from other cities and, therefore, does not really participate in a "County-wide diversion effort.' The City's program does accept green waste from the unincorporated portion of the Bakersfield area and the County pays the City of Bakersfield for its share of this green waste. In addition, the County 'operates its own green waste recycling programs and these programs receive a significant amount of green waste from the City of Bakersfield. The City of Bakersfield is not charged for the green waste that is managed by County facilities, but the City does receive diversion credit. SUMMARY The County has worked with your staff on these issues for the last year. 'We feel that there has been a constructive dialogue. If the City and County continue to work in an open, honest, and constructive manner, we expect to move toward resolution of any remaining issues. We must .maintain a clear understanding of the facts - and the fact is that the County is proposing to equalize on a per ton basis waste disposal charges throughout the county. These charges are .the same in all jurisdictions. They are calculated based on available data in a manner which is consistent with the City's own practices for calculating waste collection charges. They are fair. The fee system is not perfect - no fee system is. However, we feel the facts, as presented in your letter, are somewhat distorted. The City has enjoyed lower disposal rates due to your decision to take advantage of an inequity that developed between the original bin disposal charge and the gate fee. Now that the inequity is being eliminated, and your disposal charges will match that of other jurisdictions and businesses, describing this change as some sort of unfair attack on the City is simply wrong. A better system for sharing green waste diversion costs in Metropolitan Bakersfield needs to be developed - and can be developed - if we work together. This issue, however, must be pursued within the framework of a fee structure that is fair to all Kern County jurisdictions. ,~. 1.1/~.3/2802 18:1.8 GS1.SG28~J05 ~ PAGE 07/07 City of Bakersfield Page 6 November '13, 2002 The Waste Management Department welcomes City participation in the development of a fair and equitable fee. We are formally requesting the opportunity to meet with you and the City Council, in a workshop format, to explore these issues in more depth. Sincerely, Daphne H. Washington Director I:~CLERICAL~=TI'ER S~-50 DHW-TFM.ml.doo cc: Kern County ~ of Supervbom Scott Jona~. County Admlr~ratlv~ Office Hm~ey Hall, ~r. City d 8aka~',~l Bak~n)flald City Co~cl Raul Rojas, S~field Put~ieWmm D~c~r Kevin Barnes, SoI~ Waste Oire<~x B A K E R S F I E L D ~'~'/ ~' ~ ?'~,~?_ Alan Tandy · City Manager '~.'"' ~ November 1,2002 Ms, Daphne Washington, Director 'Kern County Waste Management Department 2700 M Street, Suite 500 Bakersfield, CA 93309 RE: Proposed Landfill Fee Increase Dear Ms. Washington: The County's proposed landfill fee increase appears to impact the City of Bakersfield more severely than other landfill users. We do not support the proposal, which: · Lowers commercial fees 5% in the County and other cities, while raising fees for Bakersfield and Taft; · Raises residential fees by $9 per year, or 15.8%, in spite of our reduced use of landfills. The plan fails to relate residential fees to the amount disposed, as required by State law. It does not give credit to communities for effective greenwaste recycling programs. · Raises Bakersfield's commercial fees by $7 per ton, or 24.1%. The City and a small group of businesses will pay over $900,000 per year more, while businesses outside the City will receive a discount. · Continues the practice of funding County-only program costs with revenue from City businesses and residents. The proposed fee increase appears to balance the County's landfill budget on the City of Bakersfield. The proposed fee increase appears to collect the majority of the County's new revenue from the City of Bakersfield, as opposed to other areas. Furthermore, it hurts residents of communities who help the Countywide system with their recycling efforts. Bakersfield should not be penalized for recycling. Historically, the County has included the cost of greenwaste disposal in landfill fees. Bakersfield has removed greenwaste from both commercial and residential disposal. Charging Bakersfield according to "averages" from other areas fails to account for this. City of Bakersfield · City Manager's Office · 1501 Truxtun Avenue Bakersfield · California · 93301 Daphne Washington November 1,2002 Page 2 If, after evaluation of these facts, a more appropriate rate increase is in order, we respectfully.request phasing it in to avoid such a large economic impact. We are willing to meet with you to discuss solutions. If any of our opinions are incorrect, please let us know why. Sincerely, , f:' ..'~ Aian Tandy City Manager cc: Honorable Mayor and City Councilmembers Raul Rojas, Public Works Director Kevin Barnes, Solid Waste Director · .. I 0 KERI1 COUtl I ASTE AIIA6 EItT OEPARTME T Daphne H. Washington, Director ~ 2700 'M' Sb'eet, Suite 500 Bakersfield, CA 93301-2370 (661) 862..890O (800) 552-KERN (opUon 6) Fax: (661) 862-8901 October 8, 2002 http://www, co.kem.ca.us/wmd/WnM.hlm Alan Tandy City Manager City of Bakersfield 1501 Truxtun Avenue Bakersfield, CA 93301. Dear Mr. Tandy: SUBJECT: Adjustments to Land Use and Gate Fees By our letter of September 18, 2002, we advised you of the Kern County Waste Management Department's intention to present a request to the Board of Supervisors to set a public protest hearing for December 10, 2002 to consider and approve a proposed increase in the land use and gate fees, which are the primary source of revenue for managing the County's waste stream. At that time, the Department proposed an increase in the land use fee from the current 'amount of $57.00 per year for single-family parcels to $63.00, and an increase in the gate fee from $29.00 per ton to $34.00 per ton. It was also proposed to lower the bin fee from $2.00 per yard to $1.80 per yard. Within the last three weeks, however, the Department has received confirmation from the Regional Water Quality Control Board (RWQCB) that they intend to require construction of a double composite liner at the Shafter-Wasco landfill, and this requirement may be extended to other County waste facilities. The liners currently in use at County landfills, and those projected for future construction, are only single composite liners. The decision by the RWQCB essentially doubles the cost of liner construction for County waste facilities. As a result of the probable impact of the RWQCB's requirement, the Department will be requesting an increase in the land-use fee to $66.00 per year and $36.00 per ton for the gate fee. The bin fee, therefore, would be decreased to $1.90 per cubic yard. A public hearing before the Kern County Board of Supervisors is still proposed for December 10, 2002 to consider these matters. If you have any questions concerning the revisions to these proposals, Please feel free to contact me at (661) 862-8998. Sincerely, By: Thomas F. McCutcheon Special Projects Manager H:WlergeDocs~NotifyCitles. Revlsions.doc cc: ADM --Cities-City of Bakersfield Winner of local state and national I awards for ihnovation and efficiency. NOTICE OF HEARING Questions About Land Use Fees DECEMBER 10, 2002 IFhat do land use fees pay for? The County operates and maintains a solid'waste system consisting NOTICE IS HEREBY GIVEN that on the 10th day of December 2002, at of landfills, transfer stations and recycling programs. The land use 2:00 p.m. in the Board of Supervisors Chambers, Kern County fee is paid by all owners of residential property in Kern County Administrative Center, 1115 Tmxtun Avenue, First Floor, Bakersfield, to pay for their proportional share of the system. Residential waste California, the Board of Supervisors will conduct a public headng on the (ordinary household trash) may be disposed or recycled at the proposal to adjust the Solid Waste Management Program Service Charges for 2003-2004. 'These charges are the Land Use Fees that are County's solid waste system without paying additional fees. charged to all residential parcels for the operation of the County's solid waste system. At said time the Board shall hear and consider all objections and protests, if any, to said adjustments.to the fees. What is not covered by land use fees? '~' All business waste. Also, waste such as tires, cars, boats, camper This is not a new fee. Solid Waste Land Use Fees have been in place . since 1988 and collected at the same time and manner as general shells, dead animals, construction and demolition material, as well County taxes since 1989. The last adjustment to the land use fees was as other items, from all sources is not ordinary household trash. in 1990. For the last 12 years,.the fees have been $57.00 per unit per These are charged a gate fee if disposed of in the landfill. year for one to four unit residential parcels or $45.60 per unit per year for a five or more unit residential parcel. To provide for increased costs of operating the solid waste system, the County is proposing to raise the land use fee to $66.00 per unit per year for one to four unit parcels and Why does the County need a fee increase? $53.00 per unit per year for a five or more unit parcel. Not many businesses could go 12 years without raising prices. Yet, the Waste Management Department has done just that. The Assuming the adjustment is approved, it will take effect July 1,200:5. If Consumer Price Index has gone up 38% since the last fee increase, written protest against the proposed fee is presented by a majority of the and the County has absorbed additional costs due to new owners of residential property in Kern County, the fee adjustment will not be made and the fees will continue at the current rate. regulations and mandated recycling programs. Since 1990, compliance with recycling, environmental monitoring and closure If you have questions regarding this notice, please call the Kern requirements has resulted in additional costs of 5 to 6 million County Waste Management Department at (661) 862-8889. A dollars per year. A major increase in the cost of landfill operations complete copy of the proposed ordinance and the report prepared was caused by the increase in prevailing wages in 2000, resulting by the Waste Management Department describing the fee and the parcels affected by the proposed increase are on file with the Clerk in additional costs of almost one million dollars per year. Recent of the Board of Supervisors, 8u~ Floor, 1115 Truxtun Avenue, changes to regulatory compliancerequirements for construction of Bakersfield, Califomia and ars available for inspectiOn during landfill liners are projected to nearly double the current cost of normal business hours, liner construction. In fiscal year 2001-2002 waste system expenses ALL INTERESTED PARTIES MaY ATTEND AND BE HEARD BY THE exceeded revenue by approximately 14%, and without a fee BOARD OF SUPERVISORS AT THE PLACE AND TIME INDICATED increase this annual budget shortfall will continue to increase. ABOVE. IF UNABLE TO ATTEND, YOU MAY FILE A VVRITTEN RESPONSE WITH THE CLERK OF THE BOARD, BOARD OF SUPERVISORS, 1115 TRUXTUN AVENUE, BAKERSFIELD, CA 93301 PRIOR TO THE TIME SET FOR HEARING. Solid Waste System Fee Increase Effective July 1, 2003 .Public Hearing December 10, 2002, 2:00 p.m. 1115 TrUxtun Avenue Bakersfield Effect of County Landfill Fee Increase The Kern County landfill fee increase proposed for July 2003 will affect various sectors of the Bakersfield community as listed below: Commercial Bin Customers ¢,~ ~%~-0 $450,00~' Small to medium businesses who use metal trash bins will pay 24% more. -Commercial Compactors, Roll Offs, and Other Trucks s'~ $450,000 A few dozen hospitals, malls, large retail st.ores, and businesses with_lar, ge I~)ads,,wi.II .piay 24% more. ~ ~"7..¢"~o.~.-'~ ~"~.E par[men[-t~u~m~ngs {~.j .,¢_,. ) (_j $110,000 About 15,000 apartment units will pay 15.8% more. Residential Customer~ (.L~.[ -~ $650,000 ~J About 72;000 homes will pay 15.8% more. Total Revenue Increase from Bakersfield Alone: $1,660,000 Projected Revenue Increase Outside Bakersfield: $ ??? BAKERSFIELD CALIFORNIA December 4, 2002 CITY COUNCIL Kern County Board of Supervisors 1115 Truxtun Avenue Bakersfield, CA 93301 Harvey L. Hall Mayor IVlarkSalvaggio Honorable Chairman and Members of the Board: Wtce. Mayor Ward? The Budget and Finance Committee of the Bakersfield City Council met with County staff on December 2, 2002 to review the proposed increases and changes to Solid hnnaCarson Waste fees proposed by the County staff. The Committee has several serious concerns War,~ regarding the proposed increase and changes which are summarized below: Susan]~_.aen~am 1. Cities and the Board of Supervisors need more time for input. Ward2 There is insufficient time for the City of Bakersfield policy makers and those from other cities to review and make comments on the proposed rate increases and Mike Maggard changes prior to the proposed adoption date by the County. Adopting the new Ward3 fees on December 10th does not provide sufficient time for adequate city input, DavidCouch much less, time for the two newest Supervisors to become fully informed of the Ward4 implications of this important issue. This matter should be delayed to allow for additional study. The City Council of Bakersfield, for example, does not meet R~roldW. Hanson until December 11th. The day after the County staff proposes that a $1.6 million War,~5 rate increase to City residents be adopted. ' JacquieSullivan 2. The land use fee increase is too severe and should be phased in and/or __ WarU 6 moderated. The approximately 15% increase to residential customers is very severe and consideration should be made to moderate or phase in this-increase if needed, over several years. The elderly and people on fixed incomes will have trOuble bearing the cost of $750,000 in the City of Bakersfield alone. Your Board should take input from the Kern County City Manager's Association on belt tightening ideas. 3. The flat rate structure is inequitable to cities who recycle. The proposed rate structure does not address the inequity caused by billing all customers the same, regardless of their efforts to recycle or divert waste. This flat rate approach disadvantages those cities who have implemented significant recycling or green waste programs. 1501 Truxtun Avenue· Bakersfield California 93301 .' (661) 326-3767 · Fax (661) 323-3780 Kern County Board of Supervisors December 4, 2002 Page - 2- 4. The commercial rate chanqes are too severe and should be phased in The adjustment proposed to commercial tonnage rates will cause a 24% increase in the per ton cost for commercial users in the City of Bakersfield and the City of Taft while there will be a 5% decrease in commercial bin rates for others. This seems an extremely severe adjustment to make in one fiscal period and if the change is indeed warranted, consideration should be given to phasing in this change over say three to five years so budgetary adjustments can be reasonably made. The cost to Bakersfield business for this rate increase is $900,000. That will impose a serious hardship on many of our businesses. 5. City residents should not pay for non-city recyclinq and qreen waste, proqrams. Due to the pooled revenue approach used by the County, funds collected from city property owners in the land use fee and landfill fees are being used to pay for green waste and other recycling costs which are for non-city residents. This means that city residents pay for city programs and for a share of non-city programs, therefore paying twice. This inequity needs to be addressed. 6. City Residents should not pay for non-city landfill closure costs. Similar to the previous item, the county intends to use pooled funds to pay for the non-city share approximately ($4 Million) of the Bakersfield landfill closure. Again city residents are paying their share of the closure costs and a portion of the non- city share of these cOsts. Again, paying twice. 7. City Residents should not pay for non-city operational costs. County exclusive costs (such as those for Green waste programs, administration of the haulers in the unincorporated areas and illegal dumping programs) have been paid for out of pooled or blended revenues for many years. Since 1994 it is estimated by city staff that at least $1.7 Million was paid by City residents for non-city costs. This practice should not be permitted to continue. 8. The City has worked with the COunty in the past to fairly apply costs, We would like similar fair treatment, The City of Bakersfield has been very generous by allowing the County to pay a break even rate to utilize city sewer plant capacity (CSA 71, Rexland Acres, etc.) and now they are asking us to pay for many things on top of a pure capacity basis for use of the county landfill. 9. State Water Board requirements were reduced, Why is there no reduction in fees? County staff originally recommended an increase to $64 in the land use fee and $34 per ton. They later indicated that an additional $2 increase in the land use fee and a $2 increase in the per ton fee was necessary due to requirements of the Regional Water Quality Control Board for a double liner at the Shafter-Wasco and other County landfills. It is our understanding that the Regional Water Quality Control Board with Vice Mayor Mark Salvaggio voting on your behalf has reduced some of the requirements to the benefit of the County. These regulatory changes which should reduce the need for additional funds are not reflected in the proposed rates. Kern County Board of Supervisors December 4, 2002 Page - 3- The Budget and Finance Committee is sending this letter to the Board of Supervisors since the City Council's next meeting is on December 11th which is after the public hearing scheduled on this matter. These issues are of such concern it was important for us to communicate with the Board prior to our Council meeting. We expect that the other members of the Bakersfield City Council as well as many Kern County cities will share these concerns. Representatives from other cities have met with our staff and indicated they too would appreciate additional opportunities for input and review of these proposals. We appreciate your consideration of these concerns and request that the proposed fee increase and changes be delayed until the issues presented can be fully reviewed and addressed. Respectfully, Mike Maggard, Budget and:Finance Committee Chairman Mark Salvaggio, Vice Mayor arold Hanson,~ouncilmember cc. Honorable Mayor and Members of the City Council BAKERSFIELD Economic and Community Development Department MEMORANDUM November 7, 2002 TO: Budget and Finance Committee ~)/d~F ~¢~'0~ FROM: Donna Kunz, Economic Development Director SUBJECT: Request for Additional Funding of $360,000 for the Bakersfield Senior Center Low Income Senior Housing Project Nearly eighteen months has passed since the Bakersfield Senior Center and Retirement Housing Inc., co-sponsors of an affordable 80-unit senior housing project received their financing award from HUD for a 202 Capital Advance in the amount of $6,670,500. The City's prior financial involvement with the project resulted from a decision to change the project boundaries to enhance the project design and quality of life of the seniors in the new community. To date, $575,000 of HOME funds has been expended acquiring several single family homes and a dilapidated apartment complex to assemble the property required for the new site. In recent weeks, development activity (design and engineering) has been completed and a contractor, S.C. Anderson has been selected to construct the project. The construction estimates have been completed. It was initially determined that the project has a shortfall of funding in the amount of $676,072. A letter was sent to city staff requesting these additional funds from the City. Staff met with the developer, contractor and Bakersfield Senior Center to try to work out a financing plan in which all parties contributed to eliminate the shortfall. The parties have reduced the original gap of $676,072 in several ways; (1) Bakersfield Senior Center and the developer have agreed on a lower price for the land, from $176,000 to $145,000. This lower price was negotiated based on a notification that HUD will only allow the senior's property to be purchased in the current "as-is" condition. This amount is $31,000 lower than the original negotiated price and is the result of a lower appraisal that S:kDEBBIE'SkBudget & FinancekBakersfield Senior Center4.doc removes the estimated value of the property that is abandoned by the City's planned 5th street vacation and the assumed demolition of some structures that are currently on the senior's property. (2) The developer has a 2% contingency in the amount of $106,678 in the budget as required by HUD. Their initial construction estimate requested an additional contingency of $153,439. Since the contractor has received bids for most of the construction costs, the lower contingency amount was agreed to be sufficient. (3) Lastly, further engineering allowances are expected in landscaping and furnishings. You can see that all parties involved with the project have sustained financial cuts in order to make the project financially feasible. Below is a financial summary of how the project shortfalls were taken into consideration: Original Shortfall $ 676,072 Less - Cancelled Contingency - 153,439 Less - Lower appraisal for BSC Land - 31,000 Less- construction value engineering - 131,633 Net Shortfall remaining $ 360,000 November 30 is the official deadline given by HUD for the developer to close the escrow on the property required for the project and finalize the 202 advance. If this is not accomplished, HUD has indicated that the 202 funding will be cancelled. Staff has identified two funding sources for the remaining shortfall. Staff recently audited, reconciled and closed out all of our old completed HOME projects resulting in available funds of $215,000. In addition, $145,000 of HOME funds is available from savings in our new construction account. These funds are not currently earmarked for other Iow income projects and exist as the result of savings generated from a multifamily housing project slated for Union and 4th Street. Using $360,000 of these funds for this project from these two HOME sources will not impact our other commitments. Meeting the financial gap to create affordable housing is challenging. Affordable housing developers look to localities and HUD to meet the gap. Despite the fact that this project received a HUD capital grant for construction costs, the HUD program does not take into consideration local costs and conditions. The 202 project is a Iow income senior project with services. The restrictive rent structure does not allow it to debt service loans. For information purposes, a schedule of recent Iow income projects that received City assistance is also attached to show the amounts received and types of financing these projects obtained in order to show how the City has participated in affordable financing in the past. Staff recommends approval of the additional funds of $360,000 to the Bakersfield Senior Center Affordable Housing Project from the identified HOME resources. S:~DEBBIE'S~udget & Finance~akersfield Senior Center4.doc HOUSING COMPARISON TABLE ECONOMIC AND COMMUNITY DEVELOPMENT DEPARTMENT California Avenue Senior Housing $1,700,000 $1,000,000 $11,900,000 180 14.29% 22.69% $15,000 Canyon Hills Senior Housing $107,000 $310,000 $5,127,553 74 2.09% 8.13% $5,635 Park Place Senior Housing $550,000 $800,000 $6,179,756 80 8.90% 21.85% $16,875 Haven House $261,000 $0 $661,000 24 39.49% 39.49% $10,875 Madison Place Apartments $550,000 $0 $4,812,500 56 11.43% 11.43% $9,821 Proposed Bakersfield Senior Housing Project $935,000 $0 $7,605,500 80 12.29% 12.29% $11,688 B A K ER S 'F I E L D CITY OF BAKERSFIELD MEMORANDUM October 16, 2002 TO: ALAN TANDY, CITY MANAGER FROM: RAUL M. ROJAS, PUBLIC WORKS DtRECTOR~ SUBJECT: BIA MEETING OF OCTOBER 14, 2002 On October 14, 2002 City staff met with Brian Todd, Executive Vice President of the Building IndustrY Association of Kern County (BIA). As instructed by the Budget and Finance Committee, staff was to meet _with Mr. Todd to' address outstanding, issues the .BIA had with staff's recommended 2.8% increase in the Park Development Fee. In this meeting, the 2 issues included in the B4A's letter of October 11, 2002 (copy of letter attached) were discussed. As indicated in the BIA's lett. er, their poeition is that any increases in the Park Development Fee should be calculated in.the same manner as the Transportation impact Fee (TIF). The TIF fee is based upon the Cost of Construction Index. For the last TIF increase, the armual averages fro.m calendar years 1997 to 2000 were used in computing the new fee. It is staff's opinion that the BIA is correct on t.his point. The C~CI would be more appropriate to use in this case than the CPI, as originally proposed by staff. Mr. Todd indicated that a fee adjustment based upon the annual averages for the most current calendar years for which a full 12 months of actual indexes are available would be acceptable to the BIA. This would be the 2001 and 2000 annual averages index, which computes to a 1.95% increase. This would increase the current fee of $635 per single family unit to $647. This is $6 less than staff's initial recommendation of a 2.8% increase (from $635 to $653 per single family unit). Staff recommends approval of the 1.95% fee increase. Mr. Todd was given the attached 2 worksheets summarizing potential uses of several bond grants applied for by the City. He indicated that philosophically, the BIA believes that the Park Development Fee should be adjusted by a credit for new development's share of the recent. Bonds. Mr. Todd stated that one way to compute this credit would be to use the .percent of new homes per year (3,000), divided by 85,000 which is the number of homes within the City. He indicated that this issue could be tabled until a future date if the Park Development Fee was increased by no more than 1.95% as discussed earlier. It is important to note that staff does not share the 'BIA's view on this issue. Recent State Bond measures have provided some funds for local Recreation and Park projects; however, they are being used for .enhancements beyond basic facilities and are distinct from those provided by the Park Development Fees. In addition, these are one time funds with special requirements which cannot be relied on for basic park development. C:\Documcnts and Scttings\glorenzi.000tLocal Scttings\Tcmp\BIA Mtg 10_14_02.doc Pa~ Deveiol:m~ent Fee Page 2 of 2 Staff also indicated a desire to work with the BIA in the near future to work towards a common understanding of the basic amenities of a 10 acre park. and the associated costs. Preliminary staff estimates show a significant increase in these costs for which input from the BIA would.be beneficial. In conclusion, staff recommends that the proposed fee increase, be based upon annual averages indexes for calendar years 2000 and 2001. This yields a 1.95% ($12) increase for single family units. With an increase no greater than 1.95%, the BIA has agreed to table its issue on the State Bond funds as previously explained. Cc: Ken Trone Georgina Lorenzi C:~Decument~ and Settings~glo~nzi.000~xx:al Settings\Tcmp\BIA Mtg 10_14_02.doc Oct-11-02 09:28A 8IA o~KQrn County 661 6331317 P.01 Memo To: Georgina Lorenzi, City Public Works From: Bdan Todd Date: 10/11/02 Re: Park Development Fee Dear Georgina: To provide a starting point for you and I to meet and further discuss BIA's questions about the proposed Park Development Fee increase: ~) Roger Mclntosh and I were involved in negotiating the Cost of Construction Index as the basis for increases in the Metropolitan Transportation Impact Fee. Pursuant to that, we believe any increases in the Park Development Fee should be calculated the same way as for the ]'IF. We also need confirmation of the 1.95 percent figure you mentioned yesterday for the Park Fee increase. (3 To assist you, I am including with this memo a list of the state bond funds we are asking to knew how and on which projects the city has budgetecl spending them. I will be away at meetings part of next week, October 16-18. The week of October 21 is probably best, in order to allow you to gather the information we need; if you prefer, I can also meet as soon as October 14 or 15. Please let me know. Bdan Todd Cc: Roger Mclntosh, Chairman, Legislative Committee Alan Tandy, City Manager 0ct-11-02 09:28A BIA of Kern County 661 6331317 P.02 Brian J. Todd From: Sent: vveor~,~ay, To: 'briant@kembia.com' Cc: 'tonya@kernl~ia,com' Subject: FW; City of Bakersfield allocations .... Orlg~nal MesSage-- - se£~; ~ean~;~ay, July 10, 2002 3;28 PM jCCL: U[uy oz Saker$[ield allocations City alloca~tons: o[ Bake?'$£ield Prop ~ Roberci-Z'Be~,~ $615.,000 h5%P=//www.parks.ca.gov/pa~es/~OOS/~i[es/~LLOCATIONSKOR2000SONDACT EZH,pdf Prop 12 Per Capita $1,357. million hCCP://www.parks.ca.gov/pa~es/1008/fi]es/ALLOCA'£IONSPOE20¢CBONDACT.pdf Pr~p 12 Socccr£ield Grants $50,000 http://www.parks.ca.~ov/Dages/lOUS/fi£es/ysb.pdf Prop 12 Prop 40 Rober~J.Z'Ber~ $614,000 (pre!imJnary) htLP://www.parks.ca.gov/pa~es/!OOS/fites/20~2BondAct RZH.PDF Prop 40 Per Capita $1.0%9 mill~on (preliminary) ht~P://Www.pa~ks.ca.go~/pages/lOOS/~les/2OO2~OndPerCapi~a.~DF You can also see t~e kisCo~ical aJloca~ion L.o Bake£sfield at; hL. tP://www.par~s.ca.gov/page~/lOOS/f~]e~/AGENCY.PDF Al~o, remember 2.5 m~llion for Kern River Parkway in Prop 13. BIA Request for Information on State Bond Funds Funding Sources: Prop 12 Roberti-Z'Berg $ 615,000 Prop 12 Per Capita 1,357,000 Subsequent Prop 12 Per Capita Allocation By State (not identified on request) 402,865 Total Funding Sources $Z3_7_42~ Uses: Community Ice Facility $ 615,000 Community Aquatic Facility 1,759,865 Total Uses ~ Additional Information: 1. The Prop 12 Soccer field Grant of $50,000 was not awarded to the City of Bakersfield. This grant was awarded to the Police Activities League which is a not for profit organization, separate from the City of Bakersfield. 2. As noted on the attached email, the 2 Prop 40 funds totaling $1,633,000 are preliminary and have not yet been allocated to the City of Bakersfield. Therefore, uses for these funds have not been identified. It is anticipated these funds would be utilized to address unmet community wide recreation and park needs. G:\GROUPDAT\Georgina~B IA REQUEST.doc Water Bond and Park Bond Grant Funding for the Kern River Parkway Proposition 12 Projects: Expand greenbelts signage and kiosks 155,000 Acquistion of privately owned property along the Kern River 102,000 Expand and improve trailhead parking 181,500 Bellvue Weir and Bikepath Bridge 375,000 Kern River Bikepath extension east (3 miles-Alfred Harrell Hwy to Lake Ming) 450,000 Kern River Bikepath widening-Stockdale to Manor 600,000 Kern River Shoreline Improvements 300,000 Kern River Bikepath extension west (9 call boxes) 45,000 COmplete equestrian trail alignment 150,000 Administrative cost retained by State 141,500 2,500,0001 Proposition 13 Projects: Bellevue Weir and Bikepath Bridge 1,220,000 2 recharge lakes (part of 40 acre soccer park) 300,000 Kern River Bikepath extension west (9 miles) 980,000 12,500,0001 DRAFT P:\Fees\Prop 13-Water Dept ADMINISTRATIVE REPORT MEETING DATE: July 31, 2002 AGENDA SECTION: Consent Calendar ITEM: 8.c. TO: Honorable Mayor and City Council APPROVED FROM: Gregory J. Klimko, Finance Director DEPARTMENT HEAD DATE: July 11, 2002 CITY ATTORNEY CITY MANAGER SUBJECT: Ordinance amending Section 5.02.060(C) of the Bakersfield Municipal Code relating to Business License Tax. RECOMMENDATION: Staff recommends adoption of the Ordinance. BACKGROUND: On September 5, 2001 the City Council referred the issue of the applicability of business license tax to owners who rent or lease commercial or residential property to the Budget and Finance Committee for review and recommendation. The committee has had numerous lengthy discussions on the issue with considerable public participation including the Bakersfield Association of Realtors, the Kern County Apartment Owners Association and the Bakersfield Chamber of Commerce. These organizations took the position that people own rental property as an investment and not as a business in which they workl or if they do work in the renting/leasing or maintenance of the property, it is on a limited basis (less than 750 hours per year). As a compromise, staff proposed that those who claim their real estate investment as passive activity under Section 469 of the Internal Revenue Code be exempt from business license tax, and at the Budget and Finance Committee meeting on May 16, 2002, presented a revised business license application form (copy attached) that provided a means to claim the exemption. After inconclusive discussion and public comment, the committee requested staff to meet with the organizations and interested individuals to work out the details of staff's proposal. This meeting was held on June 3, 2002. In the final analysis, it was agreed at the meeting that the revised application form is adequate to implement the exemption. At the June 20, 2002 Budget and Finance Committee meeting, staff reported the results of the June 3, 2002 meeting and presented an amendment to the ordinance [Municipal Code Section 5.02.060(C)] which establishes the exemption from payment of the business license tax for carrying on a business which is "rental real estate" as a passive activity. The Committee, with Councilmember Maggard abstaining because of a possible conflict of interest, approved the ordinance amendment and revised application form and requested the item be forwarded to the Council at the July 10, 2002 meeting with the recommendation for first reading. This ordinance was given first reading at the City Council meeting of July 10, 2002. Attachment S:~KimG~Bill~Admin - OrdAmend#5.060(c)2nd.doc ORDINANCE NO. AN ORDINANCE AMENDING SUBSECTION C OF CHAPTER 5.02.060 OF THE BAKERSFIELD MUNICIPAL CODE RELATING TO BUSINESS LICENSE TAXES. BE IT ORDAINED by the Council of the City of Bakersfield as follows: SECTION 1. Subsection C of chapter 5.02.060 is he?eby amended to read as follows: 5.02.060 Certificate Required - Exemptions. C. Noihing in this chapter shall be deemed or construed to apply the payment of such taxes as are prescribed in this chapter to any person transacting or carrying on any business exempt from payment of such taxes by virtue of the Constitution or applicable statutes of the United States or of the state or to any person transacting or carrying on the business of "rental real estate" as a passive activity in accordance with section 469 of Title 26 of the Internal Revenue Code. SECTION 2. This Ordinance shall be posted in accordance with the provisions of the Bakersfield Municipal Code and shall become effective thirty (30) days from and after the date of its passage. ..... ooOoo ..... ..~, ? ~' CITY OF BAKERSFIELD M.A~L TO: CALIFORNIA PREMISES MUST CONFORM TO ZONING. CITY OF BAKERSFIELD BUII.DING, FIRE AND HEALTH CODES. P.O. BOX 2057 CHANGE OF NEW LD, CA 93303 OWNERSHIP [] BUSINESS [] CHANGE OF ADDRESS [] APPLICATION FOR BUSINESS TAX CERTIFICATE PURSUANT TO ORDINANCES OF THE .CITY OF BAKERSFIELD PLEASE TYPE OR PRINT LEGIBLY IN INK BUSINESS NAME DATE BUSINESS LOCATION (Sq~'a~e C.m/ficate R~quir~d for E~h Lomion) STREET C'I 1'¥ ST ZIP MAILING ADDRESS STREET CfrY ST ZIP KIND.OF BUSINESS OR PROFESSION TELEPHONE NAMES AND ADDRESSES OF ALL OWNERS/CORPORATIONS LIST OFFICERS - INCLUDE TITLES NAME HOME ADDRESS TELEPHONE STRI:~- r CITY ST ZIP CITY ST ZIP STRI:}--r CITY ST ZIP OF ORGANIZATION: PARTNERSHIP [] CORPORATION [] FEDERAL EMPLOYER IDENTIFICATION NUMBER INDIVIDUAL [] Name SSN, I claim exemption from the Business License Tax for the organization or individual named above since it is [] Tax Exempt under Internal Revenue Code Section 501 (C)(3) or under State of California RevenUe & Taxation Code Section 23701 or; [] Considered a passive investment in the rental of Real Property under Internal Revenue Code Section 469. I understand I may be required to provide proof of continued exemption from the Business License Tax upon request. DATE COMMENCED BUSINESS IN BAKERSFIELD CALIFORNIA STATE CONTRACTOR'S LICENSE NUMBER, IF ANY SALES TAX PERMIT NO. ( .... ) ALPHA NUMERIC SUB Sales or use tax may apply to your business activities. You may seek written advice regarding the application of tax to your particular business by writing to the nearest State Board of Equalization office. For general information, please call the Board of Equalization at 1-800-400-7115 ESTIMATED ANNUAL GROSS RECEIPTS IN BAKERSFIELD I SWEAR tINDER PENALTY-OF PERJURY TItAT THE FOREGOING IS TRUE AND CORRECT. TITLE DATE Sigl~at~ Owner, Partner, Ag~t or Officer of Co~oralion License .. [ Code Sect. ISTRATIVEPORT .... ' ADMINE R -.~:~..,~,~ .... I MEETING DATE: July 31,2002 I AGENDA SECTION: Consent Calendar I ITEM: TO: Honorable Mayor and City Council APPROVED FROM: Donna L. Kunz, Economic Development Director DEPARTMENT HEAD DATE: July 23, 2002 CITY ATTORNEY // CITY MANAGER ~"~,~ ' SUBJECT: Agreement with the Bakersfield Senior Citizen Center for $50,000 of Community Development Block Grant funds for operational services at 530 4th Street. (WARD 1) RECOMMENDATION: Staff recommends approval. BACKGROUND: Since 1983, the Bakersfield Senior Citizen Center (BSC), a 501 (c) (3) non-profit corporation, has been providing senior services at 530 4th Street. The center, provides a variety of recreational, social, educational, and vocational training activities primarily for seniors of the Greater Bakersfield Metropolitan Area. Over the last 19 years, CDBG funds have been used to expand the facilities there at the 4th Street center. During the last few years, a reduction of donations and fund raisers have impacted the operations of the BSC. At the October 4, 2001 Budget and Finance Committee meeting it was recommended that the City provide the BSC with funds required to pay the expenses to operate the facility between June 2001 to July 2002 for a one-time contribution of $50,000 of Council Contingency funds. That recommendation was approved by the City Council at their October 10, 2001 meeting. In addition, it was recommended that BSC apply for CDBG funds for Fiscal Year 2002/2003. The proposed agreement will provide $50,000 of CDBG funds to assist in providing senior services at the BSC facility on 4th Street. The Bakersfield Senior Center has submitted a proposed operating budget for the next 12 months of $136,950. S:~Admins\City Council\BSC services agreement.doc 7/23/2002 10:42 AM AGREEMENTNO. BAKERSFIELD SENIOR CENTER GRANT AGREEMENT FOR OPERATIONS ASSISTANCE THIS AGREEMENT is made and entered into on by and between the CITY OF BAKERSFIELD, a California charter city and municipai corporation ("CITY" herein) and BAKERSFIELD SENIOR CENTER, INC., a California non- profit, public-benefit corporation ("CORPORATION" herein). RECITALS WHEREAS, the Congress of the United States. has enacted Title I of the Housing and Community Development Act of 1974, and amendments (the "Act"). The Act provides for Community Development Block Grants; and WHEREAS, CITY has submitted required documents to the Department of Housing and Urban Development ("HUD") for receipt of a Community Development Block Grant ("Grant") under the Act; and WHEREAS, California Government Code Section 53703 authorizes cities to participate in federally-funded health, welfare, public works, and community, improvement programs, and empowers cities to contract with public and private agencies; and WHEREAS, CORPORATION operates a senior center with programs and activities that serve Iow- and moderate-income senior citizens in the Bakersfield area; and WHEREAS, CORPORATION has requested assistance in carrying oUt some of those programs and activities; and WHEREAS, CITY desires to assist CORPORATION by funding a portion of the costs associated with certain activities for senior citizens in the Bakersfield area. NOW, THEREFORE, incorporating the foregoing recitals herein, CITY and CORPORATION mutually agree as follows: 1. NATIONAL OBJECTIVES. CORPORATION certifies that the activities carried out with funds provided under this Agreement will meet one or more of the CDBG program's National Objectives -- 1) benefit Iow/.moderate income persons; 2) aid in the prevention or elimination of slums or blight; 3) meet community development needs having a particular urgency as defined in 24 CFR Part 570.208. BSCoperations S:'~greement\BSC Operations Agreement.wpd July 23, 2002 -- Page 1 of 16 Pages -- 2. DEFINITIONS. Except as modified by the "Grant Agreement," to be entered into by CITY, CORPORATION, and HUD, any term defined in Title I of the Act, or the HUD Grant Fund RegUlations at 24 CFR 570, shall have the same meaning in this Agreement. 2.1 "Program" means CITY's Community Development Program, and its administration. 2.2 "Activities" means noon-time meals, physical fitness programs, senior advocacy programs, human services referrals and transportation activities, and other activities and services provided and/or facilitated by CORPORATION. 2.3 "Fiscal Year" means a twelve-month Period between July 1 and June 30 of the following year. 3. SCOPE OF WORK. CORPORATION will be responsible for administering the Activities in a reasonable manner consistent with any standards required as a condition of providing these funds. 4. GRANT. It is expressly agreed and understood that the total amount granted by CITY to CORPORATION under this Agreement shall not exceed FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00). 4.1 Disbursement of Funds. CITY shall not be obligated to disburSe, or pay to, CORPORATIONor any third party, any funds until and after CITY receives CDBG funds from the federal government. If CITY does not receive such funds, CITY or CORPORATION, at its option, may terminate this Agreement without any liability to the other. CORPORATION shall not be entitled to any damages from CITY and CITY shall not be entitled to any remedy against CORPORATION if either terminates the Agreement pursuant to this Paragraph 4.1, even if CORPORATION, CITY or any third party has detrimentally relied upon this Agreement. 4.2 Method of Payment..CITY agrees to pay "claims for payment" to CORPORATION within thirty (30) days after CITY receives a satisfactory "claim for payment" and after a properly-designated CORPORATION official certifies the claim. CORPORATION shall properly itemize and document claims for payment to show clearly the items, tasks, or services for which CORPORATION claims reimbursement, as well as describing to Which of the Activities the payment is related. CORPORATION shall also describe the basis for computation: cost per hour, cost per weight or cost per task. CITY may review the claim for completeness and accuracy, and may refuse to pay any claim until explained to CITY's satisfaction. BSCoperations S:~Agreement\BSC Operations Agreement.wpd July 23, 2002 -- Page 2 of 16 Pages -- 4 CORPORATION'S OBLIGATIONS. 4.1 Laws and Regulations 4.1.1 Federal. CORPORATION shall obeY the Act, any amendments, Federal regulations and guidelines now or hereafter enacted pursuant to the Act, terms of the Grant to CITY now or hereafter in effect, and CITY's regulations now or hereafter enacted to facilitate administration of the Grant, or any other statute, regulation, or guideline applicable to the Program. CORPORATION shall become familiar with the appropriate statutes, regulations, and guidelines governing the Grant program. 4.1.2 California. CORPORATION shall comply with all provisions of California' law applicable to this. Agreement. 4.2 · Independent Contractor. CORPORATION understands and agrees that it is an "independent contractor" with respect to the services to be performed under this Agreement. CITY shall be exempt from payment of all Unemployment Compensation, FICA, retirement, life and/or medical insurance and Workers' Compensation Insurance. 4.3 Indemnification. CORPORATION shall indemnify, defend, and hold harmless CITY, its officers, agents, employees and HUD against any and all liability, claims, actions, causes of action or demands whatsoever against them, or any of them, before administrative or judicial tribunals of any kind whatsoever, arising out of, connected with, or caused by CORPORATION, CORPORATION's employees, agents, independent contractors, companies, or subcontractors in the performance of, or in any way arising ' from, the terms and provisions of this Agreement whether or not caused in part by a party indemnified hereunder, except as limited by California Civil Code section 2782 or CITY's sole active .negligence or willful misconduct. 4.4 Insurance. In addition to any other insurance or bond required under this Agreement, CORPORATION shall procure and maintain for the duration of this Agreement the following types and limits of insurance ('Ibasic insurance requirements" herein): 4.4.1 Automobile liability insurance, providing coverage on an occurrence basis for bodily injury, including death, of one or more persons, property damage and personal injury, with limits of not less than One Million Dollars ($1,000,000) per occurrence; and the policy shall: 4.4.1.1 Provide coverage for owned, non-owned and hired autos. BSCoperations S:~,greement\BSC Operations Agreement.wpd July 23, 2002 -- Page 3 of 16 Pages -- 4.4.2 Broad form commercial qcneral liability insurance, unlesS otherwise approved by the CITY's Risk Manager, providing coverage on an occurrence basis for bodily injury, including death, of one or more persons, property damage and personal injury, with limits of not less than One Million Dollars ($1,000,000) per occurrence; and the policy shall: 4.4.2.1 Provide contractual liability coverage for the terms of this Agreement. 4.4.2.2 Contain an additional insured endorsement in favor of HUD, the CITY, its mayor, council, officers, agents, employees and designated volunteers. 4.4.3 Workers' compensation insurance with statutory limits and employer's liability insurance with limits of not less than One Million Dollars ($1,000,000). per occurrence; and the policy shall contain a waiver of subrogation in favor of HUD, the CITY, its mayor, council, officers, agents, employees and designated volunteers. 4.4.4 All policies required of CORPORATION shall be primary insurance as to HUD, the CITY, its mayor, council, officers, agents, employees; or designated volunteers and any insurance or self-insurance 'maintained by the 'CITY, its mayor, council, officers, agents, employees, and designated volunteers shall be excess of CORPORATION_'s insurance and shall not contribute with it. 4.4.5 Except for workers' compensation, insurance is to be placed with insu,rers with a Bests' rating as approved by CITY's RiskManager, but in no event less than A:V. Any deductibles, self-insured retentions or insurance in lesser amounts, or lack of certain types of insurance otherwise required by this Agreement, or insurance rated below Bests' A:V, must be declared prior to execution of this Agreement and approved by the CITY in writing. 4.4.6 Unless otherwise approved by CITY's Risk Manager, all policies shall contain an endorsement providing the CITY with .thirty (30) days written notice of cancellation or material change in policy language or terms. All policies shall provide that there shall be continuing liability thereon, notwithstanding any recovery on any policy. Copies of policies shall be delivered to CITY on demand. 4.4.7 The insurance required hereunder shall be maintained until all work required to be performed by.this Agreement is satisfactorily completed as evidenced by written acceptance by the CITY. 4.4.8 CORPORATION shall furnish the City Risk Manager with a certificate of insurance and required endorsements evidencing the insurance required. The CITY may withdraw its offer of contract or cancel this contract if certificates of insurance and endorsements required have not been provided prior to the execution of this Agreement. BSCoperations S:~Agreement~BSC Operations Agreement,wpd July 23, 2002 -- Page 4 of 16 Pages -- 4.4.9 Full compensation for all premiums which CORPORATION is required to pay on all the insurance described herein shall be considered as includbd in the prices paid for the various items of work to be performed under the Agreement, and no additional allowance will be made therefor or for additional 'premiums which may be required .by extensions of the policies of insurance. 4.4.10 It is further understood and agreed by CORPORATION that its liability to the CITY shall not in any way be limited to or affected by the amount of insurance obtained and Carried by CORPORATION in connection with this Agreement. 4.4.11 Unless otherwise approved by the CITY, if any part of the work under this Agreement is subcontracted, the "basic insurance requirements" set forth above shall be provided by, or on behalf of, all subcontractors even if the CITY has approved lesser insurance requirements for CORPORATION. 5 ADMINISTRATIVE REQUIREMENTS. 5.1 Financial Manaqement. 5.1.1 Accounting Standards. CORPORATION agrees to comply with 24 CFR Part 84 and agrees to adhere to thb accounting principles and procedures required therein, utilize adequate i.nternal controls, and maintain necessary source documentation for all costs incurred. 5.1.2 Cost Principles. CORPORATION Shall administer its program in conformance with OMB Circulars A-122, "Cost Principles for Non-Profit Organizations". 5.2 Documentation and Record Keeping. 5.2.1 Records to be Maintained. CORPORATION shall maintain all records required by the Federal regulations specified in 24 CFR Part 570.506, that are pertinent to the activities to be funded under this Agreement. Such records include, but are not limited to: 5.2.1.1 Records providing a full description of each activity -undertaken; 5.2.1.2 Records demonstrating'that each activity undertaken meets one of the National Objectives of the CDBG program; 5.2.1.3 Records required to determine the eligibility of activities; BSCoperations S:~Agreement\BSC Operations Agreement.wpd July 23, 2002 -- Page 5 of 16 Pages -- 5.2.1.4 Records required to document the acquisition, improvement, use or disposition of real property acquired or impro~)ed with CDBG assistance; 5.2,1,5 Records documenting compliance with the fair housing and equal opportunity components of the CDBG program; 5,2,1,6 Financial records as required by 24 CFR Part 570.502, and 24 CFR Part 84; , 5,2,1.7 Other records necessary to document compliance with Subpart K of 24 CFR 570. 5.2.2 Retention. CORPORATION shall retain all records pertinent to expenditures incurred under this Agreement for a period of three (3) years after the expiration of the Future Use Restriction Period under this Agreement. 'Records for non- expendable property acquired with funds under this contract shall be retained for three (3) years after final disposition of such property. Records for any displaced person must be kept for three (3) years after he/she has received final payment. Notwithstanding the above, if there is litigation, claims, audits, negotiations or other actions that involve any of the records cited and that have started before the expiration Of the three-year period, then such records must be retained until completion of the actions and resolution of all issues, or the expiration of the three-year period, whichever occurs' later. 5.2.3 Client Data. CORPORATION shall maintain client data demonstrating client eligibility for services provided. Such information shall be made available to CITY or its designees for review upon request. 5.2.3.1 CORPORATION shall maintain real property inventory records which clearly identify properties purchased, improved or sold. Properties retained shall continue to meet eligibility criteria and shall conform with the "changes in use" restrictions specified in 24 CFR Part 570.503(b)(8) as applicable. 5.2.4 Close-Outs. CORPORATION's obligation to CITY shall not end until all close-out requirements are completed. Activities during this close-out period shall include, but are not limited to, making final payments, disposing of .program assets (including the return of all unused materials, equipment, unspent cash advances, program income balances, and accounts receivable to the CITY), and determining the custodianship of records. 5.2.5 Audits and Inspections. All CORPORATION records with respect to any matters covered by this Agreement shall be made available to CITY, its designee or the Federal Government, at any time during normal business hours, as often as CITY deems necessary, to audit, exarfiine, and make excerpts or transcripts of all relevant data. Any deficiencies noted in audit reports must be fully cleared by the CORPORATION within 30 days after receipt by it. Failure of CORPORATION to comply BSCoperations S:~Agreement~BSC Operations Agreement.wpd July 23, 2002 -- Page 6 of 16 Pages -- with the above audit requirements will constitute a violation of this Agreement and may result in the withholding of future payments. The CORPORATION hereby agrees'to have a single audit conducted in accordance with OMB Circular A-133. 5.2.6 Reports and Payment Procedure-~, 5.2.6.1 Program Income. CORPORATION shall report annually all program income as defined at 24 CFR 570.500(a) generated by activities carried out with CDBG funds made available under this Agreement. The use of program income by CORPORATION shall comply with the requirements set forth at 24 CFR 570.504. By way of further limitations, CORPORATION may use such income during the Agreement period for activities permitted under this Agreement and shall reduce requests for additional funds by the amount of any such program income balances on hand. All unused program income shall be returned to CITY at the end of the Agreement period. Any interest earned on cash advances from the U.S. Treasury is not program income and shall be remitted promptly to CITY. 5.2.6.2 Indirect Costs. If indirect costs are charged, CORPORATION will develop an indirect cost allocation plan for determining its appropriate share of administrative costs and shall submit such plan to CITY for approval, in a form specified by CITY. 5.2.7 Proqress Reports. CORPORATION shall submit regular Progress Reports to CITY in the form, content and frequency as required by CITY. 5.3 Personnel and Participant Conditions 5.3.1 Non-discrimination Requirements. Under any related agreements or contracts, CORPORATION shall provide that no person, on the grounds of race, color, national origin, religion, sex or physical handicap, shall be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity funded in whole or in part with CDBG Program.funds. In addition, CDBG Program funds must be made available in accordance with the following: 5.3.1.1 The requirements of the Fair Housing Act and implementing regulations at 24 CFR 100. 5.3.1.2 Executive Order 11063 (Equal Opportunity in Housing). 5.3.1.3 Title VI of the Civil Rights Act of 1964 (PL 88-352) and Title VIII of the Civil Rights Act of 1968 (PL 90-284 nondiscrimination and fair housing on federally assisted programs). BSCoperations S:'~Agreernent',BSC Operations Agreement.wpd July 23, 2002 -- Page 7 of 16 Pages -- 5.3.1.4 Rehabilitation Act of 1973 and Americans with Disabilities Act. This Agreement is subject to the provisions of'SectiOn 503 and 504 of the Rehabilitation Act of 1973 (PL 930112), 29 USC 706, and attendant regulations at 24 CFR, Part 8, which provide that no otherwise qualified, disabled individual shall, solely by reason of his disability, be excluded from participation in, be denied the benefits of or be subjected to discrimination under any program Or activity receiving federal financial assistance. This Agreement is also subject to the Americans with Disabilities Act of 1990 (Public Law 101-336), as amended, 42 USC 12101, et. seq. 5.3.1.5 Non-discrimination Because of Aqe, This Agreement is subject to the Age Discrimination Act of 1975, as amended, (Title III of Public Law 94-135) and attendant Code of Federal Regulations at 48 CFR, Part 22, Subpart 22.9. That Act sets forth that, except as otherwise provided, no person in the United States shall, on the basis of age, be excluded from participation in, be denied, the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance. 5.3.1.6 Equal Employment Opportunity (Non- discrimination Clause). CORPORATION shall not discriminate against any employee, or applicant for employment, because of race, color, religion, sex, national origin, age, disability, or sexual orientation. CORPORATION shall take affirmative action to insure that applicants for employment and employees are treated during employment, without regard to race, color, religion, sex, national origin, age, disability,' or sexual orientation. Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. CORPORATION shall post in conspicuous places, available to employees and applicants for employment, notices to be provided by CITY or HUD setting forth the provisions of this nondiscrimination clause. CORPORATION shall state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, national origin, age, disability, or sexual orientation. 5.3.1,7 Women- and Minority-Owned Busine$-~ Enterprises. CORPORATION agrees to abide by the requirements of Executive Orders 11625, 12432 and 12138, the HUD regulations issued pursuant thereto at 41 CFR Part 24, 41 CFR Subpart 1-1.13, and any applicable rules and orders of HUD. The foregoing require the maximum practicable opportunity to participate, in contracts funded in whole or in part with federal funds, be provided to women- and minority-owned business enterprises, as subcontractors and suppliers to contractors performing work, or rendering services as prime contractors or subcontractors, under federally-funded procurement contracts. BSCoperations S:~greement~BSC Operations Agreement.wpd July 23, 2002 -- Page 8 of 16 Pages -- 5.3.1.8 Affirmative Action for the Vietnam-Er~ Veterans. CORPORATION shall comply with 48 CFR, Chapter 1, Subpart 22.13 ahd shall take affirmative action to employ, advance in employment, and otherwise treat qualified disabled veterans and veterans of the Vietnam Era without'discrimination based on disability or veteran's status in all employment practices such as employment, upgrading, demotion, transfer, recruitment, advertising, layoff, or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. - 5.3.1.9 Small Business Concerns. This Agreement is subject to the requirements of the Small Business Act (15 USC 631 et seq.), as amended, applicable HUD regulations at 48 CFR, Part 19, and any applicable rules and orders of HUD requiring aid, counseling, assistance, and protection, insOfar as possible, with, for, or of the interests of small-business concerns in order to preserve free competitive enterprise; and placement with small businesses of a fair prOportion of the total federally-funded purchases and contracts for property and services. 5.3.1.9.1' CORPORATION shall implement the specific small-business policies herein below to further the goals of the Small Business Act: 5.3.1.9.2 Equitable Opportunity. CORPORATION shall give small businesses an equitable opp~ortunity to compete for prime contracts and subcontracts. CORPORATION shall include the applicable "Utilization of Small Business Concerns and Small Disadvantaged Business Concerns" clause in all contracts in cOnnection with this Activity in amounts which may exceed $10,000 except; 5.3.1.9.2.1 contracts which are to be performed entirely outside the United States; and 5.3.1.9.2.2 contracts for personal services. 5.3.1.9.3 Bidder mailing lists shall include established and potential qualified small-business concerns; 5.3.1.10 CORPORATION shall send invitations for bids, or request for proposals, to all firms on the appropriate mailing list whiCh shall include an appropriate number of small businesses; 5.3.1.11 CORPORATION shall publicize proposed procurement and contract awards in accordance with these policies; 5.3.1.12 CORPORATION shall divide procurement of property and services into reasonably small lots (not less than economic production run. s) to permit bidding on quantities less than the total requirements; BSCoperations S:~Agreement\BSC Operations Agreement.wpd July 23, 2002 -- Page 9 of 16 Pages -- 5.3.1.13 CORPORATION shall allow the maximum amount of time practical for preparation and submission of bid and proposals; 5.3.1.14 CORPORATION shall establish realistic delivery schedules to encourage small business participation; 5.3.1.15 CORPORATION shall furnish applicable specifications, plans, and drawings with invitations for bids and request for proposals or information as to locations where they may be obtained, or examined; 5.3.1.15.1 CORPORATION shall treat equal Iow bids in accordance with 48 CFR Subpart 14.408-1; 5.3.1.15.2 CORPORATION shall encourage subcontracting to enroll small businesses. 5.3.1.16 CORPORATION shall place small purchases (amounts under $25,000) with small businesseS, whenever appropriate; 5.3.1.17 CORPORATION shall refer small businesses seeking federal contracts, but lacking qualifications as contractors, to CITY and the Small Business Administration for assistance as may be appropriate; 5.3.1.18 CORPORATION shall refer offers from small business concerns otherwise qualified, to perform specific federal contracts but ineligible under Walsh-Healey Public Contract Acts, to City and Small Business Administration for possible certification of eligibility to receive and perform the contract; 5.3.1.19 To the extent practicable, CORPORATION shall place work to be performed, which exceeds the maximum amount of any contract for which a surety may be guaranteed against loss, so that more than one small-business concern may perform the work; and 5.3.1.20 The Small Business Administration may certify a small business, otherwise qualified to receive and perform specific federal contracts but determined to be nonresponsible, to be competent under the provisions of the Small Business Act. BSCoperations S:~Agreement~BSC Operations Agreement.wpd July 23, 2002 -- Page 10 of 16 Pages -- 5.3.2 Federal Labor Standards Provision-~. CORPORATION shall comply with the requirements of the Secretary of Labor in accordance with the Davis-Bacon Act as amended, the provision of Contract Work Hours and Safety Standards Act, the Copeland "Anti-Kickback" Act (40 U.S.C. 276a-276a5; 40 U.S.C. 327 and 40 U.S.C. 276c) and all other applicable Federal, state and local laws and regulations pertaining to 'labor standards insofar as those acts' apply to the performance of this contract. CORPORATION shall maintain documentation which demonstrates compliance with hour and wage requirements of this part. Such documentation shall 'be made available to CITY for review upon request. 5.3.2.1 Except with respect to the rehabilitation of residential property designed for residential use for less than eight families, CORPORATION, and all contractors engaged under contracts in excess of $2,000 for the construction, alteration, and/or repair of any building or work financed in whole or in part with Federal funds provided under this Agreement, shall comply with HUD requirements pertaining to such contracts and the applicable requirements of the regulations of the Department of Labor under 29 CFR parts 3, 5, and 5.5a, governing the payment of wages and the ratio of apprentices and trainees to journeymen; provided, that if wage rates higher than those required under such regulations are imposed by state or local law, nothing hereunder is intended to relieve CORPORATION of its obligation, if any, to require payment of higher rates. CORPORATION shall cause or require to be inserted in full, in all such contracts subject to such regulations, the clause, or any modification thereof, set out in 29 CFR parts 3,5, and 5.5a. CORPORATION shall comply with the procedures set out in the HUD handbook 1344.1, "Federal Labor Standards Compliance in Housing and Community Development Programs" (as amended). 5.3.2.2 CORPORATION shall make no awards of contracts under this Agreement to any contractor ineligible under any applicable' regulations of the Department of Labor. 5.3.3 Use of Grant Funds for ReliqiOus Purpose, CORPORATION shall permit no CDBG Program funds to be expended for the design, construction, operation, or maintenance of any facility to be used for sectarian instruction or as a place for religious worship, except in situations where such use is incidental and does not favor one religious group over another. 5.3.4 Prohibited Interest of Officials and Employee-~. No member of or delegate to the Congress of the United States, .and no resident commissioner, shall be admitted to any share or part of this Agreement or to any benefit to arise from it. No member, officer or employee of CORPORATION, or its designees or agents, no member of CITY's Council or any other public official who exercises any functions or responsibilities with respect to the CDBG Program during his tenure, or for one year thereafter, shall have any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work to be performed pursuant to this Agreement. BSCoperations S:~Agreement'~BSC Operations Agreement.wpd July 23, 2002 -- Page 11 of 16 Pages -- 5.3.5 Political Activity. CORPORATION shall expend n° Grant funds to finance any political activity in contravention of the Hatch Act (Chapter 15 of Title 5 of the United States Code). 5.3.6 Lobb¥inq. CORPORATION certifies, to the best of its knowledge and belief, no Federally-appropriated funds have been paid or will be paid, by or on behalf of CORPORATION, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress, in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. 5.3.6.1 If funds, other than Federally-appropriated funds, have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan or cooperative agreement, CORPORATION shall complete and submit, in accordance with its instruction, Certification Regarding Lobbying, (Exhibit "A"). 5.4 Environmental Conditions. 5.4.1 Environmental Considerations. CITY and CORPORATION want to assure that the policies of the National Environmental Policy Act of 1969 (NEPA), as amended, and the California Environmental Quality Act of 1970 (CEQA), as amended, are most effectively implemented. Therefore, CITY shall comply with HUD EnVironmental Review Procedures (24 CFR Part 58) leading to certification of release of funds for particular projects, and the CEQA review procedures (Title 14, Section 15000 et. seq. of the California Administrative Code) in connection with this Project as rapidly as possible. Project delay occasioned by delay in obtaining HUD approval or in the CEQA review procedures shall extend the estimated work completion time frame. 5.4.2 Clean Air and Water Acts. This Agreement is subject to the requirements of the Clean Air Act, as amended, 42 USC 7401 et seq., the Federal Water Pollution Control Act, as amended, 33 USC 1251 et seq., Executive Order 11738, dated September 10, 1973, and the regulations of the Environmental Protection agency at 40 CFR Part 15, as amended. 5.4.2.1 CORPORATION shall cause or require to be inserted in full in all contracts and subcontracts with respect to any nonexempt (exceed $100,000, or involve a facility the subject of a conviction under the Clean Air Act, or the Federal Waste Pollution Control Act, and listed by the Environmental Protection Agency, or not otherwise exempt) transaction, the clause set out in 48 CFR 52.223-2. BSCoperations S:~,greement\BSC Operations Agreement.wpd July 23, 2002 -- Page 12 of 16 Pages -- 5.4.2.2 CORPORATION shall also cause or require to be inserted in full, the certification set forth in 48 CFR 52.223-1, in each solicitation and resulting contract and contracts it awards without a solicitation. 5.4.2.3 CORPORATION shall not use any funds under this Agreement for a facility which has a conviction under Section 11'3(c)(1 ) of the Clean Air Act or Section 309(c) of the Federal Water Pollution Control Act. 5.5 Other Conditions, 5.5.1 Architectural Barriers Act of 1968. This Agreement is subject to the requirements of the Architectural Barriers Act of 1968, as amended (42 USC 4151, et~ seq.) and its regulations (41 CFR Subpart 101-19.6). 5.5.2 Historic Preservation. CORPORATION shall take into. account the effect of the Project on any corporation, site, building, structure or object listed in or found by the Secretary of Interior, pursuant to 36 CFR 800, to be eligible for inclusion by the National Park Service. CORPORATION shall eliminate or minimize any adverse impact on a historic property. Activities affecting such properties must comply with Section 106 of the National Historic Preservation Act of t966 (16 USC 470f), P.L. 89-665, Executive Order 11593, May 13, 1971, the Preservation of Archaeological and Historical Data Act of 1960 (16 USC 469a-1, et. seq.), the Archaeological and Historic Preservation Act of 1974 (P.L. 93-291), and their implementing regulations. 6 CITY's OBLIGATIONS. .~' 6.1 Copy of Requlations and Statutes. CITY will make available to CORPORATION a copy of any regulation CITY enacts to facilitate administration of said Program. 7 CITY'S REMEDIES. If CORPORATION fails to materially comply with the terms of this Agreement, CITY, at its option, may suspend or terminate this Agreement and may demand CORPORATION return all funds granted to CORPORATION pursuant to this Agreement. 7.1 ConCurrent Remedy. No right or remedy herein conferred on or reserved to CITY is exclusive of any other right or remedy herein or by law or equity provided or permitted; but each shall be cumulative of every other right or remedY given hereunder or now or hereafter existing by law or in equity or by statute or otherwise, and may be enforced concurrently therewith or from time to time. BSCoperations S:~Agreement~,BSC Ooerations Agreement.wpd July 23, 2002 -- Page 13 of 16 Pages -- 8 MISCELLANEOUS. 8.1 No Waiver of Default. The failure of any party to enforce against another party any provision of this Agreement shall not constitute a waiver of that party's right to enforce such a provision at a later time, and shall not serve to vary the terms of~this Agreement. 8.2 Bindinq Effect. The rights and obligations of this Agreement shall inure to the benefit of, and be binding upon, the parties to the Agreement and their heirs, administrators, executors, personal representatives, successors and assigns. 8.3 Merqer and Modification. This Agreement, including the documents attached hereto and the instruments referred to herein) constitutes the entire Agreement between the parties and supersedes' all other oral or written representations~ This Agreement may be modified only in a writing approved by the CITY Council and signed by all the parties. 8.4 Corporate Authority. Each individual signing this Agreement on behalf of entities represent and warrant that they are, respectively, duly authorized to sign on behalf of the entities and to bind the entities fully to each and all of the obligations set forth in this Agreement. 8.5 Governinq Law. The laws of the'State of California will govern the validity of this Agreement, its interpretation and performance. Any litigation arising in any way from this Agreement shall be brought in Kern County, California. 8.6 Notices. All notices relative to this Agreement shall be given in writing and shall be personally served or sent by certified or registered mail and be' effective upon actual personal service or depositing in the United States mail. The parties shall be addressed as follows, or at any other address designated by notice: If directed to CITY, addressed to: City Clerk City of Bakersfield 1501 Truxtun Ave. Bakersfield, CA 93301 If directed to CORPORATION, addressed to: Bakersfield Senior Center, Inc. 530 4th Street Bakersfield, California, 93304 BSCoperations S:~.greement~SC Operations Agreement.wpd July 23, 2002 -- Page 14 of 16 Pages -- 8.7 Execution. This Agreement is effective upon execution. It is the product of. negotiation and all parties are equally responsible for authorship of this Agreement. Section 1654 of the California Civil Code shall not apply to the interpretation of this Agreement. 8.8 Assiqnment. Neither this Agreement, nor any interest in it, may be assigned or transferred by any party without the prior written consent of all the · parties. Any such assignment will be subject to such terms and conditions as CITY may choose to impose. 8.9 Neqation of Partnership. CITY shall not become or be deemed a partner or joint venturer With 'CORPORATION or. associate in any such relationship with CORPORATION by reason 'of the provisions of this Agreement. CORPORATION shall not for any purpose be considered an agent, officer or employee of CITY. 8.10 Tax Numbers. "CORPORATION's" Federal Tax Identification No. 77-0013149 "CORPORATION" is a corporation? Yes X No (Please check one.) IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first-above written. "CITY" "CORPORATION" CITY OF BAKERSFIELD BAKERSFIELD SENIOR CENTER, INC. By: By: MARK SALVAGGIO DR. ALEXANDER H. LARK Vice Mayor Executive Director APPROVED AS TO FORM: BART J. THILTGEN City Attorney By: JANICE SCANLAN Deputy City Attorney BSCoperations S:~Agreement'~BSC Operations Agreement.wpd July 23, 2002 -- Page 15 of 16 Pages -- APPROVED AS TO CONTENT: ECONOMIC AND COMMUNITY DEVELOPMENT DEPARTMENT By: DONNA L. KUNZ Economic Development Director COUNTERSIGNED: By: GREGORY J. KLIMKO Finance Director BSCoperations S:~greement\BSC Operations Agreement.wpd July 23,' 2002 -- Page 16 of 16 Pages -- SCHEDULE"A" Community Development Block Grant Bakersfield Senior Center Public Service 'Grant Purpose The Bakersfield Senior Citizens Center (BSC), a 501 (c)(3) nonprofit corporation located 'at 530 4th Street, provides a variety of recreational, social, educational, and vocational training activities primarily for Iow income Senior Citizens of the Greater Bakersfield Metropolitan Area. In most cases these services are provided at no cost to the seniors, with BSC bearing the responsibility to pay for the activities through its various fund-raising ventures. Recent increases in utility rates and decline in operating revenue leaves BSC in need of annual assistance to continue providing services to the senior citizen community. Description BSC will receive up to $50,000.00 in FY 2002-03 CDBG funds from City of Bakersfield to continue to provide its important services to the Iow income senior citizen community in Greater Bakersfield, (see attached matrix). BSC will provide the services listed in the attached for the duration of this agreement. CDBG funds ur~der this agreement may be used to pay the costs of CDBG eligible expenses such as: employee salaries and benefits, professional .fees, supplies, utilities, facility operation and maintenance. BSC shall submit documentation of expenses to be reimbursed at time payment is requested under this agreement. A certifiCation that all financial obligations are met services are being provided to seniors shall be signed and submitted with each payment request. Time Frame All CDBG funds granted to BSC shall be completely expended within fifty-two (52) weeks of the execution of this agreement. BSCoperations S:~greement~BSC Operations Agreement.wpd July 23, 2002 -SA-1 - BAKERSFIELD SENIOR CENTER BUDGET 2001-200i Revenue: ... United Way Allocations 10,000 Sublease Area Aging & Adults 2,400 Sublease Bakersfield City -1'5,000 United Way Designations 4,500 Bingo Donations 15,000 Hall Rentals .. ... 15,000 Grant - Bakersfield City 50,000 Membership Dues 2,500 Fund RaisingJMisc Income 20,000 -'. Pancake Breakfast 2,400 Recycling . -150 Total Revenue 136,950 Personnel Cost: Administrator Coordinator 1'2,843 Acccuntant " 17,465 Salary and Wages 40% of 50,514. 20,206 Group Health Insurance 6/mos @ 525/mo. 3,150 Payroll Taxes Employer (FICA) 3,864 State Unemployment Ins. 980 Wcrker's Comp. 1,028 Total Personnel 59,536 Other Cost; Professional Fee 5,000 Focal and Beverage Cost 1,000 Office Supplies 5,000 Janitcrial Supplies 5,000 ' Printing 1,000 Bank Charges '. 100' Postage and Shipping 1,290 Telephone/System' 9,769 Liability Ins. Bldg/Grounds 7,600 Utilities Gas and Lights 18,237 Water 3,000 Building/Grounds Maint. 3,000 Security -/Mann System 5,759 Rental Mainetnance Equip. 3,000 Miscellaneous Cost 8,500 Tax License Others 159 Total Other Cost 77,414 Total. Expenditures 136,950 -SA-2- Programs : ;]: t~r::t'r'x'~:;;'":l: ::::::::::::::::::::::::::::::: ' I -.:,.l. ~::::::~. t~[I ~:..~..l..~ ::::::::::::::::::::::: . ..- ..~:~:~--: : :~:.:~:}~:~::~::~ ............................ ifi?j~l:vl I [ ::~(:5~:~([ [ i ]~ ~ .... (!~'~'J}~(~:::l .x ......... ~ ......... L~:~:::~::::~{~:~:~:~:~]:'.::~ :~[~ . [ , D]:[:~: :::::::::::::::::::::::::: ' ..l ::.;~ ':~.:$:~::: :':::}l EXHIBIT "A" CERTIFICATION REGARDING LOBBYING The undersigned certifies, to the best of his or her knowledge and belief, that: (1) No federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer o'r employee of any agency, a Member of Congress, an Officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. (2) If 'any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to inflUence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobl~ying," in accordance with its instructions. (3) The Undersigned shall require that the language of this certification be included in the award documents for all sub-awards at all tiers (including subcontractors, sub-grants, and contracts under grants, loans, and cooperative agreements) and that all sub-recipients shall certify and disclose accordingly. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certificatiOn is a prerequisite for making or entering into this transaction imposed by Section 1352, Title 31, U.S. Code. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure. Date Executive Director ADMINISTRATIVE REPORT I MEETING DATE: July 31,2002 I AGENDA SECTION;Consent Calendar I ITEM: 8.x. TO: Honorable Mayor and City Council APPROVED FROM: Raul M. Rojas, Public Works Director DEPARTMENT HEAD ~/~r~ DATE: July 19, 2002 CITY ATrORNE¥~ .,~,. ~- CITY MANAGER SUBJECT: Amendment No. I ($20,540) to Consultant Contract No. 99-191 (for a total contract amount of $44,142) with Michael Brandman Associates for additional environmental services to make a determination regarding Kit Foxes at the Calloway Drive at Friant Kern Canal (Ward 4). RECOMMENDATION: Staff recommends approval of amendment. BACKGROUND: The City has a project to relocate the Friant-Kern Canal under the intersection of Olive Drive and Calloway Drive. The United States Bureau of Reclamation owns the canal and they are requiring extensive environmental studies. During the initial phase of this project, the Bureau has requested additional environmental information not originally planned for. The original contract amount of $23,602 with Michael Brandman Associates has almost been exhausted. This amendment will allow Michael Brandman Associates to complete the environmental studies. Amendment No. I adds $20,540 to the total compensation amount bringing the total contract amount to $44,142. This project is part of the Capital Improvement Program, and funds are available in the project to pay for these services. dl3s July 24, 2002, 9'.31am G:\GROUPDA'r~DMINRP'F~2002~Iul 31~Arnend 1 to 99-191 adrnin.wpd AGREEMENT NO. AMENDMENT NO. 1 TO AGREEMENT NO. PW 99-191 THIS AMENDMENT NO. 1' TO AGREEMENT NO.' PW 99-191 is made and entered into on , by and between the CITY OF BAKERSFIELD, a municipal corporation, (referred to herein as "CITY") and' MICHAEL BRANDMAN ASSOCIATES (referred to herein as "CONTRACTOR"). RECITALS WHEREAS, CITY and CONTRACTOR have entered into Agreement No. PW 99-. 191; and WHEREAS, the parties desire to amend Agreement No. PW 99-191 to provide additional environmental studies and documents for the Realignment of the Friant Kern Canal, as described in Exhibit "A". NOW, THEREFORE, incorporating the foregoing recitals herein, CITY and CONTRACTOR mutually agree as follows: 1. The first paragraph of Section 2 of Agreement No. PW 99-191 entitled "COMPENSATION" is hereby amended to read as follows: "Compensation for all work, services or products called for under this Agreement shall consist of a not to exceed total payment of FORTY FOUR THOUSAND ONE HUNDRED FORTY TWO dollars ($44,142.00) Which shall be paid as follows: 2. Except as otherwise amended herein, all of the provisions of Agreement No. shall remain in full force and effect. -- Page 1 'of 2 Pages'-- IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to Agreement No. to be executed the day and year first above written. "CITY" "CONTRACTOR" CITY OF BAKERSFIELD By: By: HARVEY L. HALL Mayor Title: APPROVED AS TO CONTENT: DEPARTMENT By: APPROVED AS TO FORM: BART J. THILTGEN City Attorney By: ALAN D. DANIEL Deputy City Attorney COUNTERSIGNED: By: GREGORY J. KLIMKO Finance Director ADD:Isc 2 of 2 Amendment No.lto Agreement No. C:\DOCUMENTS AND SETTINGS\BZARAGOZ~LOCAL SETTINGS\TEMP\MXLIBDIR~AMENDMEN'I-rOAGREEMENT.DOC March 6, 2002 ADMINISTRATIVE REPORT MEETING DATE: July 31, 2002 AGENDA SECTION: Consent Calendar ITEM: 8. n. TO: Honorable Mayor and City Council APPROVED FROM: John W. Stinson, Assistant City Manager DEPARTMENT HEAD ~ DATE: July 23, 2002 CITY A'I'rORNE~Y × CITY MANAGER ~ ' SUBJECT: Amendment No. I to Resolution No. 97-01 approving and adopting the City of Bakersfield Operating and Capital Improvement Budgets for Fiscal Year 2001-02 to incorporate previous budget actions approved by the City Council. RECOMMENDATION: Staff recommends adoption of resolution. BACKGROUND: On June 27, 2001, the City Council adopted Resolution No.97-01 approving and adopting the City of Bakersfield Operating and Capital Improvement Budgets for the Fiscal Year 2001-02. From July 1,2001 through June 26, 2002, Council has taken action to transfer and/or appropriate funds for specific services and as a result, the reSpective budgets must be amended to reflect these changes for.the past twelve months of the fiscal year. This amendment is a technical administrative year end clean up procedure necessary to reflect previous Council budgetary actions for FY 01-02.. The fiscal year 2001-02 Amended Budget is $388,843,039, with the Operating and Debt Service (which includes the Community Development Block Grant) Budget and transfers totaling $309,048,866, the Capital Improvement Program totaling $ 61,099,058, and the Bakersfield Redevelopment Agency Budget totaling $18,695,115. A detailed listing of the items approved by Council action (Exhibit "A"), which amends the 2001-02 budgets, is attached. July 23, 2002, 11:23am S:~)amell~dmins~20Ol~Amend 1-01-02finalcouncilapproval.wpd RESOLUTION NO. AMENDMENT NO. I TO RESOLUTION NO. 97 - 01 ADOPTING THE OPERATING AND CAPITAL IMPROVEMENT PROGRAM BUDGETS FOR THE CITY OF BAKERSFIELD, CALIFORNIA, FOR THE FISCAL YEAR 2001-02.. WHEREAS, in accordance with the Charter of the City of Bakersfield and applicable ordinances, the City Council of said City approved Resolution No. 97-01 adopting the Operating and Capital ImprOvement Program Budgets for the City of Bakersfield, California, for the fiscal year 2001-02 on June 27, 2001; and, WHEREAS, the City desires to make amendments thereto; NOW, THEREFORE, BE IT RESOLVED by. the Council of the City of Bakersfield as follows: 1. That the Operating and Capital Improvement PrOgram Budgets for the City of Bakersfield, California, for the fiscal year 2001-02, as adopted by Resolution No. 97-01, are hereby further amended to reflect the applicable changes included in Exhibit 2. That said Budgets for said fiscal year 2001-02, so amended, shall' be the Budgets For the City of Bakersfield, California, for said fiscal year 2001-02 as contemplated to be made by this Council. 3. That said Budgets for fiscal year 2001 -02 shall total $388,843,039 with the Operating and Debt Service (which includes the Community Development Block Grant) Budget and transfers totaling $309,048,866, and the Capital Improvement 'Program totaling $61,099,058, and the Bakersfield Redevelopment Agency Budget totaling $18,695,115. 4. That the Cibi Clerk shall certify to the adoption of the resolution, and henceforth and hereafter the same shall be in full force and effect. .......... o0o .......... I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on by the following vote: AYES: coUNClLMEMBER CARSON, BENHAM, MAGGARD, COUCH, HANSON, SULLIVAN, SALVAGGIO NOES: COUNCILMEMBER ABSTAIN: COUNClLMEMBER ABSENT: COUNCILMEMBER. CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED HARVEY L. HALL MAYOR oftheCity of Bakersfield APPROVED astoform: BART THILTGEN CITY ATTORNEY JWS:jp S:DARNELL\PROJ~Budget amendments01-02 Resolution.wpd July 13, 2002 - 2 - CITY OF BAKERJD FISCAL YEAR 201]~ ,~ BUDGET AMENDMENTS EXHIBIT" A" BEGINNING ClP BUDGET JULY 1, 2001 $39,437,429 PAGE 1 OF 3 DATE FUND ITEM AMOUNT COMMENTS 07/02/01 419 To Correct Budget Adjustment 525 For Encumbrance Carryovers $4,104,700 E, ncumbrences In Fund 412 - Funded By Transfer From Sewer Connection Fund 07/18/01 317 App. Prop. 12 State Grant Revenue to the State Grant Fund $2,358,500 Kem River Parkway CIP Projects (item 8cc) 07/19/0t 669 To Establish Estimated Assessment District 01-01 Appropflations $2,408,665 Assmt. Dists. Ming at Allen, Mountain Vista Drive and Hampton Place 10/03/01 311 / 511 App. and Transfer ACCEL Refund'to CIP In Capital Outlay Fund $160,000 Relooation of PG&E gas transmission line (Item 8si 10/03/01 331 App. Transportation Development Fund Balance to CIP $340,000 Additional funds for Paladino Ddve Street Construction (Item 8q.) 10/24/01 461 App. Offstret Parking Fund balance to CIP $13,000 Property acquisition from PG&E et southeast comer of 14th & P (item 8r.) 10/24/01 111 App. Prior Year CDBG Entitlement Funde (Redevelopment) · $7,760 Conctruct Fence at International Square (item 8wi 1 2/1 2/01 142 App. Transportation Oevelopment Act Article 3 Funds to Capital Improvement Budget $28,000 For University Avenue Bike Lane Project. (Ward 3) (Item 8.x.) 11/'14/0'1 181 App. State CLEEP Grantr Funds to Police CIP $353,100 Mobile Data Computer Project (item 9bi 01/09/02 461 App. and transfer Capital Outlay Fund balance to Off Street Parking Fund CIP $250,000 Property acquired at 1426 'P' Street (Item 8.v.) 01/09/02 311 App. General Fund beg fund balance to Capital Outlay Fund CIP $1,400,000 Southwest Fire/Police Facility (Item 8.u.) 01/09/02 311 Transfer from General Fund to Capital Outlay Fund ClP $1,420,000 Southwest Fire/Police Facility (Item 8.u.) 01/09/02 311 'App. Asset Fodeitures to Capital Outlay Fund ClP Budget $208,000 Southwest Fire/Police Facility (Item 8.u.) 01/23/02 412 App. County share to ClP Sewer Enterprise Fund $97,000 Brimhall Road Sewer - Westdale Drivwe to Allen Rd. (Item 8.s.) 01/23/02 412 App. Fund balance to ClP Sewer Enterprise Fund $678,000 Brimhall Road Sewer - Westdale Drive to Allen Rd. (item 8.s.) 01/23/02 011 / 461 App. and Transfer Procced of Sale Of WWTP #1 Site to Offstreet Parking Fund $313,070 Land Aqulsition For Addt'l Parking Cente. nnial Garden (item 8mi 02/06/02 412 App. Fund Balances to ClP within the Swr Enterprise Fund $115,000 Road widening, striping, signal mod on Brimhall, Calloway - Coffee (Item 8.r.) 02/06/02 331 App. Fund Balance to ClP within Trans. Dev. Fund $280,000 Road widening, striping, signal mod on Brimhall, Cailoway - Coffee (Item 8.r.) 03/06/02 331 App. Fund Balance to CIP within Trans. Dev. Fund $700,000 Design Work On Intemhange at Route l&*& Fairfax Road (item 8mi 03/06/02 331 App. Fund Balance to CIP budget within Transportation Development Fund $250,000 Interchange of St Rte 99 at White Ln - overcrossing widening (Item 8.n.) 03/06/02 336 App. Air Quality Funds to Equipment Management Fund CIP $433,772 Natual Gas Fueling Station Project (Item 8.y.) 03/06/02 511 App. Equipment Management fund to Amtrak Railway Fund ClP $421,972 Bakersfield Amtrak Station (Item 8.y.) 11/28/01 321 App. from Park Improvement Fund Balance to Capital Improvement Budget $600,000 Property Acquisition Mesa Marin Sports Complex (Item 12.a.) 11/28/01 331 App. from Transportation Dev. Fund Balance to Capital Improvement Budget $50,000 Property Acquisition Mesa Marin Sports Complex (Item 12.a.) 03/20/02 181 App. Equipment Management Fund balance to CIP $700,000 Funds for purchase of Mobile Data Computer Systems, Phase I (Item 8.i.) 03/20/02 511 App. SLESF balance to ClP $42,900 Funds for pumhase of Mobile Data Computer Systems, Phase I (Item 8.i.) 03/20/02 311 App. Capital Outlay Fund balance to ClP $112,000 To furnish, configure & install IBM NAS Gateway system (Item 8.z.) 04/10/02 331 App. fund balance to ClP within Transportation Dev. Fund $65,000 Kmll Way Bridge, West of Gosford Road (Ward 5) (Item 8.ea.) 04/10/02 331 App. fund balnce to the CIP within the Transportation Dev. Fund $250,000 Design cons. costs & ROW acquisition costs for Westside Pkwy (Item 8.y.) 04/10/02 311 Transfer from Capital Outlay Fund/CIP Budget to Equipment Management Fund ($25,000) Equip Centennial Center for use by Rec & Parks, & EDCD (Item 8.kk.) 04~24/02 181 App. COPS MORE 01funds to CIP Budget within the Capital Outlay fund $1,080,000 Purchase of a Computer Aided Dispatch System (Item 8.1.) 04/24/02 11 / 461 App. and transfer Motor Vehicle In-Lieu Taxes to ClP in the Off-Street Parking fund $400,000 Land acquisition, closing costs, relocation assistance (Item 8.s.) 04/24/02 331 App. fund balance to CIP within Transportation Dev. Fund $135,000 Traffic signal at Mount Vernon and Panorama (Item 8.cc.) 04/24/02 670 Establish Assessment District 01-02 ClP Budget $6,781,548 Establish New Assessment District 01-02. 05/08/02 331 App. fund balance to ClP within Transportation Development fund $177,560 Consultant's Agreement with Luster National, Inc.- Westside Parkway project (item 8.q.) 05/08/02 311 App. contributions from Hall Ambulance Service within the Capital Outlay Fund $12,000 To the Traffic Preemption Project (item 8.v.) 05/22/02 411 App. fund balance to ClP Budget within Swr Ent Fund $1,230,000 Mohawk Sewer Installation Phase II (Item 8y) 06/12/02 121 App. Federal RSTP Revenue to ClP Budget within ISTEA Fund $715,000 Godford Road Reconstruction (item 8.11) 06/12/02 331 App. fund balance to ClP Budget within TDF Fund $550,000 Godford Road Reconstruction (item 8.11) 06/12/02 511 App. CMAQ funds and fund balance to the ClP within the Equip. Mgmt. Fund $919,710 Uquifled and Compressed Natural Gas Fueling Facility (Item 8.ff.) 06/12/02 662 App. Excess Interest Earnings to CIP Budget within Assment Dis194-3 Fund $908,464 Acquisition of Additional Public Improvements Within the District Boundaries (Item 8.qq.) 06/12/02 317 Transfer from Dev. Svcs. Gen. Fund Op. budget to Rec. Facilities CIP BUdget $210,000 Acquatlcs Center (item 11 a) 06/12/02 411 App. fund balance to CIP Budget within Swr Ent Fund $60,000 Manhole Costs (item 8 mm) PAGE 2 OF 3 06/26/02 511 App. fund balance to ClP within Equip Mgmt Fund $45,000 Purchase of telephone equipment (leto 8.c.) 06/26/02 311 App. Capital Outlay Fund balance to Fire Dept CIP Budget $8,100 Hazardous Materials Abatemenl/Painting at Fire Stn 7 (Item 8.w.) 06/26/02 317 Transfer & App. Capital Outlay Fund CIP Budget to Rec Facility Fund CIP Budget $300,000 Ice Facility / Aquatic Center Design Cost (Item 8.dd.) 06/26/02 311 App. & Transfer Savings from Fire Dept Op Budget to Capital Outlay Fund CIP Budget $125,000 SW Fire / Police Facility Funding (Item 8.ee.) 06/26/02 311 App. & Transfer Council Contingency to Capital Outlay Fund CIP Budget $144,000 SW Fire / Police Facility Funding (Item 8.ee.) 06/26/02 321 App. Park Imp Fees/Park In-Lieu Fees to Park Imp. Fund CIP Budget $311,000 SW Fire / Police Facility Funding (Item 8.ee.) 06/26/02 311 App. Fire Systems Trust to Capital Outlay Fund CIP Budget $60,000 SW Fire / Police Facility Funding (Item 8.ee.) 06/26/02 142 App. TDA Article 3 Funds to PedeStrian/Bikeway FUnd ClP Budget $13,568 Northeast Bike Path Project (Item 8.gg.) 06/26/02 151 App. AB2928 State Funds to CIP Budget within Gas Tax Fund $339,000 Resurfaclng Various Streets 2002 (item 8 u.l.) 06/26/02 412 App. fund balance to ClP Budget within Swr Ent Fund $9,000 Resurfaclng Various Streets 2002 (item 8 u.1 .) TOTAL CAPITAL IMPROVEMENT PROGRAM AMENDMENTS $32,669,389 AMENDED CIP BUDGET JUNE 26, 2002 $72,106,818 BEGINNING OPERATING BUDGET JULY 1, 2001 $238,563,802 DATE AMOUNT COMMENTS 07/01/01 VAR Mgr. Carryovers From FY00-01 $50,093,602 Mgr. Carryovers From FY00-01 07/01/01 VAR Open P.O.'s From FY 00-01 $19,074,889 Open P.O.'s From FY 00-01 07/02/01 191 Correct Budget Side Of Encumbrance Rollover Process ($45,833) Professional Advertising Services Convantion Center 07/16/01 11 To App. Seized Asset Revenue To Police Dept. Operating Budget $60,000 For Crime Lab Krimesite Scope (item 8k) 07/16/01 12 To App. Dev. Share to Development Services OperatingBudget $22,733 For Environmental Impact Report (item 8r) 07/18/01 411 / 511 Transfer Refuse Fund Balance to Equip Mgmt Fund Operating Budget $360,000 Pumhase of 2 Four-Wheel Drive loaders (Item 8u.) 09(19f0'{ 392 To ADp. Downtown R[)A Housing Fund Balance $75,000 Contribution to Bakersfield Rescue Mission (item 8j 09/19/01 11 App. grant funds from Great Valley Center to Development Services Op Budget $3,720 Offset staff time for New Valley Connexlons Regional GIS Standards Project (Item 8v) 10/24/01 321 App. Park Improvement Fund Balance to Non-Departmental Operating Budget $126,000 Reimburse Developer of River Oaks Ranch Park (Item 8aa.) 10/24/01 ' 11 App. Grant Funds to Fire Operating Budget Within the General Fund $88,687 Funding for one additional Fire Inspector position (Item 8cc.) 11/14/01 11 App. to Rec. and Parks Operating Budget within General Fund $20,000 Expenditures for training Disney Keys to Excellence Treining Prg (Item 8.v.) 11/14/01 115 App.of CHFA HELP Loan to Community Dev. Operating Budget $500,000 Affordable housing for Lakeview/Cottonwood area (Item 8.hh.) :11/14/01 11 App. to Fire Dept. Operating Budget within General Fund $27,080 To purchase an Early Warning System (Item 8.ff.) 07/02/01 VAR To Correct Budget Side of Encumbrance Rollover Process ($54,135) Finance Dept. Adjustment 11/14/01 11 App. additional building fee revenues to Bldg Op Budget in the General Fund $104,000 Two additional Building Inspectors(Item 8.gg.) 11/14/01 511 Transfer to Equipment Fund For Vehicles For 2 Building Inspectors $39,120 Purchase of vehicles for Building Inspectors (Ultem 8.gg.) 12/12/01 412 / 511 App. Sewer Enterprise Fund to Public Works Operating Budget $10,000 To provide sufficient funds to award SCADA bid (Item 8.w.) 01/09/02 11 Appr. CAL MET Grant funds to Police Operating Budget in the General Fund $510,476 Califomia Multi-Jurisdictional Methamphetamine Enforcement Team (Item 8.w.) 11/28/01 11 App. Dept. of Justice Grant Funds to Fire Dept. Operating Budget $279,997 Equipment and supplies from Preparedness Equipment Program Grant 01/23/02 011 App. to Fire Department Op budget within General Fund $2,807 Swift Water Rescue Boat (Item 8.u.) 02/06/02 011 Appr. Asset Forfeiture Revenue to PD Operating Budget $18,400 To purchase kits for the 9-1-1 For Kids Program (Item 8.s.) 02/20/02 321 Appr. Park Improv. Fund balance to Non-Departmental Operating Budget $126,000 Reimburse Developer of River Oaks Ranch Park (Item 8.dd.) 01/23/02 431 To App. Bond Proceeds of 2002 G O Bond Refunding to Ag Water Budget $4,991,817 Ag WaterBond Proceeds Dated Janua~j 15, 2002 02/20/02 321 To Reverse Group Number 3586 - Duplicate Entry ($126,000) Finance Dept. Adjustment For Duplicate Entry 03/04/02 321 To Reduce 2001-02 Adopted Appr. Included In Mgr's Carryon/ers ($985,000) Finance Dept. Adjustme~tt For Duplicate Entry 03/04/02 321 To Reduce 2001-02 Adopted Appr. Included In Mgr's Carryovers ($985,000) Finance Dept. Adjustment For Duplicate Entry 03/06/02 12 Appr. SMI monies to Dev. Serv. DePart. General Fund Operating budget $5,945 Post Disaster Safety Assessment Training (All Wards) (Item 8.z.) ~ - 02/20/02 371 SE Bak Project Area Tax Increment to RDA Op Budget $76,000 Agreement for the SE Bakersfield Strategic Plan (Item 8.ee.) 03/06/02 371 SE Bak Redev Area available revenue to RDA Op Budget $183,500 Demolition of Improvements at 333 Union Ave. (Item 8.y.) 3 OF3 03/06/02 412 Fund Balance to Steet Div. Operating Budget $35,000 Emergency Repairs On Fairfax Road (item 8cc) -~ 03/06/02 11 / 511 App. and Transfer General Fund Balance to Equip Operating Budget $1,040,000 Road Reclaimer, Soil Stabilizer and Asphalt Paving Machine (item 10 a) ~ 04/10/02 145 Appr. Interest Income to the PW Dept. Operating Budget within Amtrak Operating Fund $1,000 Operation and maintenance costs for the Bakersfield Amtrak Station (Item 8.j.) 04/10/02 145 Appr. fund balance to PW Dept. Operating Budget with Amtrak Operating Fund $21,415 Operation and maintenance costs for the Bakersfield Amtrak Station (Item 8.j.) 04/10/02 112 Appr. Prior Year Entitlement to EDCD Operating Budget with HOME program fund $35,201 Southeast Bakersfield Infill Housing Project (Item 8.w.) 04/10/02 112 Appr. Prior Year Income to EDCD Operating Budget within HOME program fund $45,716 Southeast Bakersfield Infill Housing Project (Item 8.w.) 04/10/02 111 Appr. CDBG prior year entitlement to the CDBG operating budget $2,850 Escrow fees, related reports e: 407, 417 * 425 Lakeview (Item 8.x.) 04/10/02 11 Appr. & transfer General Fund beg balance to Equip Mgmt Fund Operating Budget $104,000 Two additional 10 cubic yard dump trucks for the Streets division (item 8.gg.) 04/10/02 11 Appr. & transfer Council Contingency to' Equip Mgmt Fund Operating Budget $82,000 Two additional 10 cubic yard dump trucks for the Streets division (Item 8.gg.) 04/24/02 12 App. Dev. Contribution to Dev. Svcs. Operating Budget $111,600 EIR Study Pacheco/Gosford Road Area (item 8p) 04/24/02 111 Appr. EDI funds to CDBG operating budget $370,000 Reimbursement to KCSOS-Construction of Educational Facility (Item 8.r.) 04/24/02 421 Appr. Solid Waste Fund Balance to PW Operating Budget $62,000 Pumhase 1400 containers prior to 06/30/2002 (Item 8.bb.) 04/24/02 381 Appr. Available Revenues to Old Town Kern-Pioneer Operations Fund $46,000 Consultant Agreement For Preparation of Section 108 & BEDI (Item 8.dd.) 04/24/02 011 Appr. from Office of Emergency Services to General Fund Fire Dept. Operating Budget $70,882 Overtime Costs In Mutual Aid Assignments (Item 8.ee.) 04/24/02 670 Establish Assessment District 01-02 Operating Budget $1,098,452 Establish New Assessment District 01-02. 05/08/02 11 Appr. Asset Forfeiture revenue to PD Op Budget within General Fund $34,500 Pumhase of equip for the Kern Narcotics Enforcement Team (Item 8.w.) 06/12/02 411 Appr. fund balance to PW Operating Budget with Sewer Enterprise Fund $235,000 Increased Electricity Costs (item 8 pp) 06/12/02 011 App. Cntributions to General Fund Recreation and Parks Operating Budget $1,750 Keep Bakersfield Beautiful Great American Cleanup (Item 8.rr.) 06/26/02 372 /~op. SE ProJ Area Housing Fund balance to RDA Op Budget $11,100 Purchase of tax defaulted properties (Item 8.1.) 06/26/02 012 App. Developer's Contribution to Dev Services Op Budget Within General Fund $116,000 EIR for GPA/ZC #02-0193- Panama Ln/Hwy 99 (Item 8.q.) 06/26/02 112 App. Prior Yr HOME Entitlement to Community Dev Op Budget within HOME Prg Fund $44,148 Reconciliation for HUD programs (Item 8.cc.) TOTAL OPERATING AMENDMENTS $78,172,419 AMENDED OPERATING BUDGET JUNE 26, 2002 $316,736,221 AMENDED OPERATING & CIP BUDGETS- JUNE 26, 2002 $388,843~039 TOTAL AMENDED OPERATING BUDGET $309,048,866 TOTAL AMENDED ClP BUDGET $61,099,058 TOTAL AMENDED REDEVELOPMENT BUDGET $18r695r115 TOTAL AMENDED OPERATING, ClP & REDEVELOPMENT BUDGETS $388~843,039 CITY OF BAKERSFIELD FY 2001-02 ADOPTED BUDGET Departmental Appropriations by Fund Attachment A I General Public Water Recreation Development Non- I Budget Summary Government Police Fire Works Resources and Parks Services Departmental Total I Operatinq Budqets City of Bakersfield $14,846,330 $42.250,477 $20,551,078 $58,299,297 $10,409,725 $16,536,469 $10,449,109 $57,850,562 $231,193,047 Bakersfield Redevelop. Agency $0 $0 $0 $0 $0 $0 $1,051 255 $6,319,500 $7,370,755 Total Operating $14,846,330 $42,250,477 $20,551,078 $58.299,297 $10,409,725 $16,536,469 $11,500 364 $64,170,062 $238,563,802 Capital Improvements City of Bakersfield $217,642 $500.000 $1,367,000 $22,033,577 $3,240,400 $1,078,810 $0 $0 $28,437.429 Bakersfield Redevelop. Agency $0 $0 $0 $11,000,000 $0 $0 $11,000,000 Total Capital Improvements $217,642 $500.000 $1,367,000 $33,033,577 '$3,240,400 $1,078,810 $0 $0 $39,437,429 Total Appropriations $115,063.972 $42,750,477 $21,918,078 $91,332.874 $13.650,125 $17,615,279 $11,500,364 $64,170,062 $278,001.231 CiTY OF BAKERSFIELD FY 2001-02 ADOPTED BUDGET Departmental Appropriations by Fund Attachment A I General Public Water Recreation Development Non- City of Bakersfield Government Po#ce Fire Works Resources and Parks Services Departmental Total Operatinq Budqet General Fund $8,495,363 $40,570,477 $20,551~078 $12,783,083 $11,865,920 $6,727,114 $5,589,965 $106,583,000 Transient Lodging Taxes $4,670,549 $7,937,967 $12,608,516 Gas Tax $2,463,587 $2,463,587 Traffic Safety $1,680,000 $1,050,000 $2,730,000 Municipal Improvement Debt $332,898 $332,898 Public Financing Authority $24,000 $13,617,785 $13,541,785 Capital Outlay Fund $2,200,000 · $2,200,000 Amtrak Operating Fund $190,718 $190,718 Transportation Development $70,000 $450,000 $520,000 Agriculture Water $3,188,936 $1,089,600 $4,278,536 Domestic Water $10,000 $7,220,789 $1,195,938 $8,426,727 Parking Lots/Structures $145,170 $145,170 Park improvement Fund $18,000 $2,478,863 $2,496,863 Refuse Collection $22,393,405 $1,027,250 $23,420,655 Aviation Fund $116,592 ~ $116,592 Self Insurance $5,219,205 $5,219,205 Supplemental Law Enforce. $0 Equipment Management $1,042,700 $12,828,292 $13,870,992 Wastewater Treatment Plant $7,425,620 $9,882,760 $17,308,380 Community Dev. Block Grant $3,576,825 $332,898 $3,909,723 Assessment Districts $65,062 $10,654,638 $10,729,700 Total Operating $14,846,330 $42,250,477 $20,551,078 $58,299,297 $10,409,725 $16,536,469 $10,449,109 $57,850,562 $231,193,047 CITY OF BAKERSFIELD FY 2001-02 ADOPTED BUDGET Departmental Appropriations by Fund Attachment A General Public Water Recreation Development Non- City of Bakersfield Government Police Fire Works · Resources and Parks Services Department,; Total Capital Improvements Surfact Transportation (ISTEA) $3~225,400 Transportation (TDA) $3,225.400 Gas Tax $2,304,900 $0 $2,304,900 Park Improvement $357,090 $357,090 Captial Outlay Fund $217,642 $1,367,000 $320.000 $593,720 $2,498,362 City Stadium Project Fur~d $5,000,000 $5.000,000 Transportation Development $2,290,000 Road and Bridge Bond Funds $2,290,000 $0 Agriculture Water $132,000 $132,000 Domestic Water- $3,108,400 $3,108,400 Parking Lots/Structures $380.000 $380,000 Refuse Collection $282,000 Aviation Fund $282,000 Amtrak Railway $0 Public Facilities $0 Equipment Management $0 $0 Wastewater Treatment Plant $7,542,000 $7,542,000 Community Dev. Block Grant $689,277 $128,000 $817,277 Supplemental Law Enfome. 500,000 Assessment Districts $500,000 $0 Total Capital Improvements $217,642 $500,000 $1.367,000 $22,033,577 $3.240,400 $1,078;810 ' $0 $0 . $28,437,429 Total City of Bakersfield $15,063.972 $42,750,477 $21,918,078 $80,332,874 $13,650,125 $17,615,279 $10.449,109 $57,850,562 $259,630,476 CITY OF BAKERSFIELD FY 2001-02 ADOPTED BUDGET Departmental Appropriations by Fund Attachment A General Public Water Recreation Development Non- Government Police Fire Works - Resources and Parks Services Departmental Total Bakersfield Redevelopment Agency Operatinq Budqet Downtown $31,225 $1,835,000 $1,866,225 Oldtown Kern Pioneer $12,800 ' $13,000 $25,800 Southeast $17,230 $40.500 $57,730 Housinq Downtown $990.000 $990,000 Oldtown Kern Pioneer Southeast Debt Service $4.431,000 $4.431,000 Total Operating $0 - $0 $0 $0 $0 $0 $1,051,255 $6,319,500 $7,370,755 Capital Improvements Oldtown Kern Pioneer $0 Southeast Stadium Project Fund $11,000,000 $11,000,000 Total Capital Improvements $0 $0 $0 $11,000,000 $0 $0 $0 $0 $11,000,000 Total BRDA $0 $0 $0 $11,000,000 $0 $0 $1,051,255 $6,319,500 $18,370,755 ADMINISTRATIVE REPORT J MEETING DATE: July. 10, 2002 AGENDA SECTION: Reports ITEM: 10.a. / TO: Honorable Mayor and City Council APPROVED FROM: Gregory J. Klimko, Finance Director DEPARTMENT HEAD/~.~/~.. DATE: June 26, 2002 CITY ATTORNEY . CITY MANAGER SUBJECT: Ordinance amending Section 5.02.060(C) of the Bakersfield Municipal Code relating to Business License Tax (First Reading). RECOMMENDATION: The Budget and Finance Committee recommends First Reading of the Ordinance. BACKGROUND: On September 5, 2001 the City Council referred the issue of the applicability of business license tax to owners who rent or lease commercial or residential property to the Budget and Finance Committee for review and recommendation. The committee has had numerous lengthy discussions on the issue with considerable public participation including the Bakersfield Association of Realtors, the Kern County Apartment Owners Association and the Bakersfield Chamber of Commerce. These organizations took the position that people own rental property as an investment and not as a business in which they work, or if they do work in the renting/leasing or maintenance of the property, it is on a limited basis (less than 750 hours per year). As a compromise, staff proposed that those who claim their real estate investment as passive activity under Section 469 of the.'" Internal Revenue Code be exempt from business license tax, and at the Budget and Finance Committee meeting on May 16, 2002, presented a revised business license application form (copy attached) that provided a means to claim the exemption. After inconclusive discussion and public comment, the committee requested staff to meet with the organizations and interested individuals to work out the details of staff's proposal. This meeting was held on June 3, 2002. In the final analysis, it was agreed at the meeting that the revised application form is adequate to implement the exemption. At the June 20, 2002 Budget and Finance Committee meeting, staff reported the results of the June 3, 2002 meeting and presented an amendment to the ordinance [Municipal Code Section 5.02.060(C)] which establishes the exemption from payment of the business license tax for carrying on a business which is "rental real estate" as a passive activity. The Committee, with Councilmember Maggard abstaining because of a possible conflict of interest, approved the ordinance amendment and revised application form and requested the item be fOrwarded to the Council at the July 10, 2002 meeting with the recommendation for first reading. Attachment S:\KIMG\BILL\ADMIN - ORDAMEND#5.060(C).DOC ORDINANCE NO. AN ORDINANCE AMENDING SUBSECTION C OF CHAPTER 5.02.060 OF THE BAKERSFIELD MUNICIPAL CODE RELATING TO BUSINESS LICENSE TAXES. BE IT ORDAINED by the Council of the City of Bakersfield as follows: SECTION 1. Subsection C of chapter 5.02.060 .is hereby amended to read as follows: 5.02.060 Certificate Required - Exemptions. C. Nothing in this chapter shall be deemed or construed to apply the payment of such taxes as are prescribed in this chapter to any person transacting or carrying on any business exempt from payment of such taxes by virtue of the Constitution or applicable statutes of the United States or of the state or to any person transacting or carrying on the business of "rental real estate" as a passive activity in aocordance with section 469 of Title 26 of the Internal Revenue Code. SECTION 2. This Ordinance shall be posted in accordance with the provisions of the Bakersfield Municipal Code and shall become effective thirty (30) days from and after the date of its passage. ..... oo0oo ..... · -' ~ CITY OF BAKERSFIELD MAIL TO: CALIFORNIA PREMISES MUST CONFORM TO ZONING. CITY OF BAKERSFIELD BUILDING, FIRE AND HEALTH CODES. OX 2057 CHANGE OF NEW RSFIELD, CA 93303 OWNERSHIP [] BUSINESS [] CHANGE OF ADDRESS [] APPLICATION FOR BUSINESS TAX CERTIFICATE PURSUANT TO ORDINANCES OF THE CITY OF BAKERSFtgLD PLEASE TYPE OR PRINT LEGIBLY IN INK BUSINESS NAME DATE BUSINESS LOCATION,, (Separate Ca'fi~cate Required rot Each Location) STREET CITY ST ZIP MAILING ADDRESS STREET ui I Y ST ZIP KiND OF BUSINESS OR PROFESSION, TELEPHONE NAMES AND ADDRESSES OF ALL OWNERS/CORPORATIONS LIST OFFICERS - INCLUDE TITLES NAaME HOME ADDI~SS TELEPHONE STR~hT CITY ST ZIP STREET CITY ST ZIP STP, EET CITY ST ZIP OF ORGANIZATION: PARTNERSHIP [] CORPORATION [] FEDERAL EM2°LOYER IDENTIFICATION NUMBER INDIVIDUAL [] Name SSN. I claim ex.emption from the Business License Tax for the organization or individual named above since it is [] Tax Exempt under Internal Revenue Code Section 501(C)(3) or under State of California Revenue & Taxation Code Section 23701 or; [] Considered a passive investment in the rental of Real Property under Internal Revenue Code Section 469. I understand I may be required to provide proof of continued exemption from the Business License Tax upon request. DATE COMMENCED BUSINESS IN BAKERSFIELD CALIFORNIA STATE CONTRACTOR'S LICENSE NUMBER, IF ANY SALES TAX PERMIT NO. ( .... ) ALPHA NUMERIC SUB Sales or use tax may apply to your business activities. You may seek written advice regarding the application of tax to your particular business by writing to the nearest State Board of Equalization office. For general information, please call the Board of Equalization at 1-800-400-7115 ESTIMATED ANNUAL GROSS RECEIPTS IN BAKERSFIELD I SWEAR UNDER PENALTY-OF PERJURY THAT THE FOREGOING IS TRUEAND CORRECT. TITLE DATE Sigllature Owner, Partner, Agent or Officer of Corporation BAKERSFIELD Economic and Community Development Department MEMORANDUM --~t~u~ ~ May 7, 2002 TO: Budget and Finance Committee FROM: Donna L. Kunz, Economic Development Director SUBJECT: Request from Cornerstone Group for $26,000 forgivable loan to rehabilitate additional office space for a southeast incubator program. Request: Stephanie Campbell, owner of the Cornerstone Group, has made a request for funding to rehabilitate additional office space to increase business incubator tenants. The company currently leases a 3,000 square foot office building at 201 California Avenue. The company currently has five small business tenants and would like to rent out additional office space within the building, that is currently unrentable due to improvements needed. Attached is the request letter from Cornerstone Group and her outline for the incubator program. Background: Ms. Campbell has been an advocate of a business incubator site and program for southeast Bakersfield since her initial involvement in the formation of the Southeast Bakersfield Redevelopment Project Area in 1999. She is currently the Chair of the Southeast Project Area Committee. From her submittal, Ms. Campbell indicates involvement in various southeast community programs for a number of years. On her own initiative, Ms. Campbell leased the vacant commercial building last December, renovated as much of the office space as financially possible and started her own business incubator type program. In essence, the Cornerstone Group is a start up business itself. Ms. Campbell has been operating the Cornerstone Group for approximately three years. As such, there is limited company and financial history to rely upon in order to evaluate the potential security or success of the proposal. Performance of company: Ms. Campbell projected within her application that the business incubator could create 20 to 25 jobs over the next two years of operation, with the majority of jobs being for Iow and moderate income individuals. With no history of operating a business incubator, except for the past three months, staff cannot determine the viability of the Cornerstone Group or their projection of jobs to be created. Though with 11 offices available to rent (after improvements) for incubator clients, it has the potential to create that number of jobs over the next two years. Security: Other forgivable business loans have been secured by either personal guarantees or liens on the equipment financed. There is no available security for the proposed loan. Ms. Campbell has a five year lease on the building. Staff is meeting with the owner of the property to discuss the acceptance of a lien on the property to secure the loan. Budget and Finance Committee May 7, 2002 Page 2 Repayment requirement: The proposed financial assistance to Cornerstone Group would be a forgivable loan. Some economic development loans made by the City of Bakersfield are repayable and some others are forgivable. Typically in a forgivable loan, one-fifth of the loan amount is forgiven for each year the company meets the requirements of the agreement. The proposed agreement would be tied to Iow and moderate jobs created by the business incubator, under Community Development Block Grant guidelines. Financial analysis: As part of the Community Development Block Grant Business Loan application, Ms. Campbell submitted past tax records, a financial statement, and a profit and loss statement on the project. Past tax records indicate annual gross income between $22,000 to $44,000. The financial statement indicates minimal available savings (less than $1,000) or personal assets (no residential ownership, or securable equipment). The profit and loss statement provided by Ms. Campbell indicates with full rental of office space, the project would have a $2,675 loss the first year and net profits of $6,555 annually the second and subsequent years thereafter. A copy of the Cash Flow Projection and Profit and Loss Statement is attached. Conclusion: This forgivable loan would certainly be outside the normal business loan criteria and practices in the past. It would be an unsecured loan. It is essentially a start up business loan, with the positive aspect of the business already in operation at the location. The funds will be going toward improving a previously vacant, dilapidated building and putting it back into commercial use. (Funds would be paid directly to a contractor, not Ms. Campbell, via the CDBG bid process on work completed.) The project will also continue the revitalization of the Union and California avenues, with its location next to the Food 4 Less currently under construction. This will add to the exposure the business incubator will get from thousands of daily grocery store customers. Recommendation: Although outside the parameters of the traditional city business loan policies, there is a benefit to Bakersfield's southeast residents that will be provided with this project. Within the $1 million in CDBG funds set aside to improve southeast Bakersfield, there is approximately $400,000 budgeted for economic development projects to benefit the area. This project could be an excellent opportunity to provide office space and an incubator atmosphere for the budding entrepreneurs within the southeast community. The operator of the facility, Ms. Campbell, has been an advocate of providing incubator space and business counseling for southeast entrepreneurs for many years. Funding this reasonably small project would provide the southeast community an effective start on developing an incubator facility for their entrepreneur needs. As important as providing the office space, is the individual willing to assist her tenants in making them successful in their endeavors. With Ms. Campbell's nurturing and a facility to get their businesses started, southeast entrepreneurs can hopefully grow to the point of needing larger office space or their own buildings in the southeast community. While the funding of this type of facility, operated by a start up business is a very risky proposition, staff acknowledges the use of CDBG funds as acceptable for this project on the premise that there may be the potential of creating a viable business that may spawn other successful businesses for the southeast community. The City has put a lot of time, resources and efforts into revitalizing the California and Union avenues with streetscape work, construction of Food 4 Less, demolition of old motel structures, new senior housing, and the proposed community activity center. Rehabilitating this building to become a viable economic asset on California Avenue would assist in continuing our efforts of removing blight in the southeast community and continue Councilwoman Carson's Budget and Finance Committee May 7, 2002 Page 3 improvement objective of "Putting a new face on Southeast Bakersfield". Staff is seeking concurrence from the Budget & Finance Committee that the proposed assistance meets the Council directive of using the southeast CDBG set aside funds to directly benefit the southeast community. With input from the committee, staff will develop a CDBG forgivable loan agreement, not to exceed $26,000 (with the final loan amount based on getting as least three competitive bids for the improvement work) and bring the item to the Council for their review and recommendation. attachments: Letter and incubator program outline dated January 7, 2002 from Cornerstone Group Cash Flow Projection and Profit and Loss Statement, December 10, 2001 S:~Admins\Stephanie Campbell loan request to B & F.wpd THE CORNERSTONE GROUP~".~ i I GREATER BAKERSFIELD PARTNERS IN PROGRESS 201 CALIFORNIA AVENUE ~ BAKERSFIELD, CALIFORNIA 93304 Phone 661-326-7300 ~ Fax 661-326-0701 January 7, 2002 Ann: George Gonzales, Community Development Coordinator City of Bakersfield Economic and Community Development Department 515 Truxtun Avenue Bakersfield, California 93301 RE: Application for City of Bakersfield Business Assistance Program Loan Dear Mr. George Gonzales The Comerstone Group and our umbrella organization Greafer Bakersfield Partners In Progress, is submitting the following application to the City of Bakersfield Business Assistance Pro,am for a Business Loan in the amount of ~26.000.00. The request is being made to rehabilitate an office building at 201 California Avenue in Bakersfield California for use as a Small Business Incubator Program. We are requesting that our project and application be presented at the next City Budget and Finance meeting on January 17, 2002. We have attached the Application Form and all backup documents from your checklist. If you have any questions, please call me, at (661) 326-7300. Stephanie CamplSell President/CEO cc: Donna Kuntz Alan Tandy Budget and Finance Committee Members GREATER BAKERSFIELD PARTNERS IN PROGRESS 1408 VIRGINIA AVENUE BAKERSFIELD, CALIFORNIA 93307 (661) 324-7445 ~BUSINESS INCUBATOR PROGRAM I. EXECUTIVE SUMMARY [ The Cornerstone Group is an interdisciplinarY consulting firm specializing in strategies for business/organizational development, promotion and marketing. Cornerstone uses an innovative approach to dealing with the problems that new businesses face. We help new businesses avoid the inherent problems associated with launching a new business enterprise, while we work at stabilizing and growing existing businesses. We directly address underdeveloped management skills, under - capitalization, and growth limitations. Cornerstone accomplishes this by providing strong management support through consultation pro,ams, alliances with local economic and development agencies as well as support from academic representatives. Our goal is to correct faulty management strategies before they create problems that can result in business failure. Undercapitalization is combated by minimizing the cost associated with operating a business. We help business owners to spend less time worrying about monthly lease payments and allow them to spend more time generating goods and services. We encourage growth by reducing errors made by owners, with realistic approaches to expansion until the business owner is sure that the business has a firm foothold on the market. The Cornerstone Group believes in both economic prosperity and community vitality, where key benefits are directly related to informing business owners of realistic alternatives. Cornerstone promotes a synergy among businesses that creates unparalleled success. GREATER BAKERSFIELD PARTNERS IN PROGRESS 1408 VIRGINIA AVENUE BAKERSFIELD, CALIFORNIA 93307 (661) 324-7445 '"~';]~BUSINESS INCUBATOR PROGRAM Cornerstone has Four Main Objectives in their Business Development Programs: 1.) Creating new jobs in communities! 2.) Helping businesses start up, grow, and prosper! 3.) Reducing failure rates of new businesses! 4.) Promoting and Marketing businesses, business programs and the community! Cornerstone concluded that the best way to assist small business owners and the community was to become a "Community Development Corporation", so we created "Greater Bakersfield Partners in Progress" (GBPNP), a Non-Profit 501(C) 3 organization to fill the void. GBPNP mission is to design and operate Small Business Development Programs in low income communities. ( See Appendix - A: Community Development Corporation Profile) Our first project is the "GBPNP Business Development Center" which will house a Small BUsiness Incubator Program. GBPNP leased a 3,000 square foot commercial/office building located at 201 California Avenue in Southeast Bakersfield. The building has eleven (11) separate offices that GBPNP will lease out to ten (10) individual business owners. The Incubator Program will serve as a tool to stimulate start-up and development of small businesses in the Southeast Area of Bakersfield. GBPNP will provide support to small businesses within the program and assist residents wishing to open businesses. GBPNP focus will be on providing Bakersfield residents with training and employment skills along with business ownership opportunities. Our goal is to nurture them through their first several years of businesses ownership. 2 GREATER BAKERSFIELD pARTNERS IN PROGRESS 1408 VIRGINIA AVENUE BAKERSFIELD, CALIFORNIA 93307 (661) 324-7445 ~BUSlNEss INCUBATOR PROGRAM GBPNP has also completed Part One of.a Three Part Application to establish a CommuniO, Development Credit Union. The Credit Union will help provide venture capital to tenants and establish a financial institution for Southeast Residents. (See Appendix - B: Community Development Credit Union Summary) The Business Center will provide low cost access to training/counseling in business development, office space, secretarial service, conference rooms, and Intemet access. We are requesting technical assistance from the Weill Institute - Small Business Development Center (SBDC), and the Business Research and Education Center of Cai State University, Bakersfield (CSUB). It is expected that companies will grow and exit the program in 24-36 months and move from the incubator program to other commercial office space within the Southeast Area. GBPNP is currently soliciting funds in the amount of $26,000.00 for initial remodeling and upgrading of the building, purchasing equipment and opening the program on January 2, 2002. CONTACT PERSON: Stephanie CampbelL - President 201 California Avenue Bakersfield, California 93304 (661) 326,7300 CASH FLOW PROJECTION FACTORS DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV YEAR1 YEAR2 YEAR3 CASH BAlaNCE(OPENING) 0 10.000 16.725 13.711 11,959 19.389 19.318 19.248 19,177 19.107 19,036 18,966 18.895 10.000 18,825 25.380 PLUS: RECEIPTS CASH SALES 0 0 1.561 2,923 12,105 4.605 4,605 4.605 4,605 4,605 4.605 4,605 4.605 53,525 62,755 62,755 MORTGAGE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 BANK LOAN 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CDBG FUNDS 0 15.000 0 0 0 0 0 0 0 0 0 0 0 15,000 0 0 COUNTY 0 15,000 0 0 0 0 0 0 0 0 0 0 0 15,000 0 0 COMMUNITY 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CASH 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL RECEIPTS 0 30.000 1.561 2.923 12.105 4,605 4,605 4,605 4.605 4.605 4.605 4.605 4,605 83,525 62,755 62,755 LESS:EXPENDITURES PURCHASES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUPPLIES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SALARIES 0 500 500 500 500 500 500 500 500 500 500 500 500 6,000 6,000 6,000 PAYROLL TAXES 0 75 75 75 75 75 75 75 75 75 75 75 75 900 900 900 ADVERTISING 0 200 200 200 200 200 200 200 200 200 200 200 200 2,400 2,400 2,400 DUES & SUBSCRIP 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LEGAL & ACCT 0 100 100 100 100 100 100 1 O0 100 1 O0 100 100 1 O0 1,200 1,200 1,200 OFFICE SUPPLIES 0 100 100 100 100 100 100 1 O0 1 O0 100 1 O0 100 100 1,200 1,200 1,200 TELEPHONE 0 100 100 100 100 100 100 100 100 100 100 100 100 1,200 1,200 1,200 UTILITIES 0 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000 12,000 12,000 MISCELLANEOUS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 COMMISSIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ' 0 0 INSURANCE 0 100 100 100 100 100 100 100 100 100 100 100 100 1,200 1,200 1,200 RENT 0 6,000 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 33,500 30,000 30,000 TAX & LICENSE 0 100 0 0 0 0 0 0 0 0 0 0 0 100 100 100 INTEREST-LOAN 0 0 0 0 0 0 0 0 0 0 0 0 ; 0 0 0 0 INTEREST-MTGE 0 0 0 0 0 0 0 0 0 0 0 0 ,'. 0 0 0 0 GIFTS/DONATIONS 0.00 0 0 0 0 0 0 0 0 0 0 0 I 0 0 0 0 AUTO EXPENSES 0.00 0 0 0 0 0 0 0 0 0 0 0 I 0 0 0 0 BANK SERVICE CHARGES 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OUTSIDE SERVICES 0.00 0 0 0 0 0 0 0 0 0 0 0 ~ 0 0 0 0 SUBTOTAL 0 8,275 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 59,700 56,200 56,200 LOAN PAYMENT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OWNER DRAW 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MORTGAGE PAYMENT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CAPITAL PURCHASES 0 15,000 0 0 0 0 0 0 0 0 0 0 0 15,000 0 0 BUILDING IMPROVEMENTS 15,000 TOTAL EXPENDITURES 0 23,275 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 4,675 74,700 56,200 56,200 ENDING CASH (0) 16,725 13,711 11,959 19,389 19.318 19,248 19,177 19,107 19,036 18,966 18,895 !' 18,825 18,825 25,380 31,934 NET SALES FACTORS DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV' YEAR1 YEAR2 YEAR3 SPACE 'RENTED (SF) 0 3 6 10 10 10 10 10 10 10 10 10 10 10 10 OFFICE RENT $320.45 0 961 1,923 3,205 3,205 3,205 3,205 3,205 3,205 3,205 3,205 3,205 31,725 38,455 38,455 OFFICE RENT-CREDIT UNION $1.00 0 400 400 400 400 400 400 400 400 400 400 ; 400 4,400 4,800 4,800 COUNSELING $25.00 0 300 600 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 ~ 1,000 9,900 t2,000 12,000 MINORITY BUS CONFERENCE 0 0 0 7,500 0 0 0 0 0 0 0 ' 0 7,500 7,500 7,500 0 0 0 0 0 0 0 0 0 0 0 I 0 0 0 ., 0 0 0 O' 0 0 0 0 0 0 0 0 " 0 0 0 0 TOTAL SALES 1.00 0 1.661 2,923 12,105 4,605 4,605 4,605 4,605 4,605 4 605 4 605 ' 4,605 53,525 62,755 · 62 755 LESS: COST OF SALES ~ PURCHASES (INVENTORY) 0.00 0 0 0 0 0 0 0 0 0 0 0 ~ 0 0 0 0 SUPPLIES 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0.00 0 0 0 0 0 0 0 0 0 0 0 i' 0 0 0 0 TOTAL COST OF SALES 0.00 0 0 0 0 0 0 0 0 0 0 0 " 0 0 0 0 S DEO ,^N FEB APR ,UN ,UL AUG SEP'OCTNO+ Y R1 Y R2 Y R3 SA LA R I ES 0. O0 500 500 500 500 500 500 500 500 500 500 500 500 6,000 6,000 6,000 PAYROLL TAXES 0.15 75 75 75 75 75 75 75 75 75 75 75 75 900 900 900 ADVERTISING 0.00 200 200 200 200 200 200 200 200 200 200 200 200 2,400 2,400 2,400 DUES & SUBSCRIPTIONS 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LEGAL/ACCOUNT(PROF F E ES) 0.00 100 100 100 100 1 O0 100 100 100 100 100 100 100 1,200 1,200 1,200 OFFICE SUPPLIES 0.00 100 100 100 100 100 100 100 100 100 100 100 100 1,200 1,200 1,200 TELEP HONE 0.00 100 100 100 100. 100 100 100 100 100 100 100 1 O0 1,200 1,200 1,200 UTILITIES 0.00 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000 12,000 12,000 MISCELLANEOUS 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 COMMISSIONS 0,00 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 GIFTS/DONATIONS 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 AUTO EXPENSES 0.00 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 BANK SERVICE CHARGES 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OUTSIDE SERVICES 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL CONTROLLABLE EXP. 0.47 2,075 2,075 2,075 2,075 2,075 2,075 2,075 2,075 2,075 2,075 2,075 2,075 24,900 24,900 24,900 FIXED EXPENSES DEPRECIATION 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INSURANCE 0.00 100 100 100 100 100 100 100 100 100 100 100 100 1,200 1,200 1,200 RENT 0.00 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000 30,000 30,000 TAXES & LICENSE 0.00 100 0 0 0 0 0 0 0 0 0 0 0 100 100 100 INTEREST-LOAN 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INTEREST-MORTGAGE 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0.00 0 0 0 ' 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONAL 0.00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL FIXED EXPENSES 0.58 2,700 2,600 2,600 2,600 2,500 2,600 2,600 2,600 2,600 2,600 2,600 2,600 31,300 31,300 31,300 TOTAL EXPENSES 1.05 4,775 4,675 4,675 4,675 ~.675 4,675 4,675 4,675 4,675 4,575 4,675 4,675 56,200 56.200 56,200 NET PROFit 0 05 /4 775~ '3 ^ .... .--- ............................................ ,_: .... ,= ...... ,__. = ; __. ,j= ...... ...... ......... =(,=0;)__ ........ _?_ ........ ?_02_ ...... (70) (70) (70) (70) (70 6 55 6555 ADMINISTRATIVE REPORT I MEETING DATE: March 20, 2002 I AGENDA SECTION: Reports ITEM: 10.a. · TO: Honorable Mayor and City Council APPROVED FROM: Gregory J. Klimko, Finance Director DEPARTMENT HEAD~ DATE: March 13, 2002 CITY ATTORNEY._~~_ CITY M.~AGER.~~ SUBJECT: Budget and Finance Committee Majority Report No.1-02 and Minority Report No. 1-02 regarding Business License Taxes. 1. Ordinance amending Section 5.02.010 (A) of the Bakersfield Municipal Code relating to Business License Taxes. (First Reading) RECOMMENDATION: The Budget and Finance Committee recommends acceptance of the reports and Council determination on First Reading of the Ordinance. BACKGROUND: On September 5, 2001, the City Council referred the issue of application of the business license ordinance to owners who rent or lease commercial or residential property to the Budget and Finance Committee for review and recommendation. Councilmember Hanson had been contacted by Anthony L. Leggio, Esq. on behalf of Truxtun Business Plaza after they were notified by the City's Treasury Division to obtain a business license for renting/leasing of commercial property. Mr. Leggio did not agree with this application of the business license ordinance. He interpreted the ownership of their rental property to be a "passive investment," as defined by the Internal Revenue Service because they spent less than 750 hours annually leasing/renting the property and, therefore, outside the scope of the business license ordinance. The City Attorney's Office responded to the initial complaint. Municipal Code Section 5.02.010 broadly defines business as all activity carried on for the purpose of profit without distinguishing how much time is required to produce revenues or gross receipts. The owners of Truxtun Business Plaza complied and applied for a business license for rental or leasing of property, but requested review of the ordinance. The business license tax ordinance has historically been applied to all business activity which generates "gross receipts" unless otherwise exempted by State or Federal law. This tax is a fee imposed for the privilege of conducting business in the City and generates revenue to compensate the City for providing municipal services. March 13, 2002, 4:32pm ADMINISTRATIVE REPORT The Budget and Finance Committee met on December 6, 2001, January 17, and February 21,2002. The Committee and staff reviewed the fairness issue at length and considered how to apply the business license tax to owners who rent or lease commercial or residential properties and still provide for the equal protection under the law issue. Staff surveyed several other cities, including the 10 usual survey cities. Eight of the 10 survey cities have a business license tax for leasing or renting of commercial and residential property. For residential properties, some of the cities provided for a minimum number of units allowed before the business license tax was applicable. The position of the City Attorney's Office in regard to this business license ordinance as currently written, the licensing is for use of the property for commercial concerns, and not related to the ownership interests of the property. The original concern of Mr. Leggio was their operation is a passive investment. From a legal standpoint,.it was the City Attorney's opinion the investment is an ownership interest and is not a use interest. The City is actually taxing the use of the property as a use for commercial rentals. The City Attorney had concerns regarding the equal protection issue when applying the ordinance. Normally business licensing is based upon the nexus of the fact the public entity is providing services to businesses. If the City attempts to separate out "passive investments" and determine it should not be taxed, others paying the tax and receiving identical services could have a legal challenge that this is not equal application of the ordinance. Therefore, the City Attorney recommended to apply the business license tax to property owners who rent or lease commercial properties. For residential properties, he recommended to determine if a person owns four or more residential rental units (or some set number), that person is conducting a rental business and, therefore, subject to the business license tax, and ownership of less that four residential rental units shall not be subject to the business license tax. It was determined the business license tax has ~been in the Code for years and is not subject to. Proposition 218. The Finance Director agreed with the City Attorney, but his reasoning was based upon the fact the business license ordinance is not regulatory; it is a revenue raising measure. The amount of revenue last year was approximately $20,563 from businesses that rent/lease properties. Current staff should be able to handle enforcement for 2002-03. The Finance Director recommended to apply the business license tax as broadly as we legally can to raise revenue. The Finance Director believes passive investment measurement is a net income approach, while the City ordinance is based on gross receipts. City staff currently performs gross receipts audits at minimal cost. Audits on a basis other than gross receipts is more costly add, therefore, not practical. Committee Members Hanson and Salvaggio felt the method used to apply the tax needs to be fair and equitably enforced and agreed with the recommendation of the City Attorney. Therefore, the Majority Report recommends to apply the business license tax to property owners who rent or lease commercial properties, and amend the existing ordinance for residential rentals to apply the business license tax to owners who rent or lease five or more units (four units or less would be exempt from the business license tax). Committee Chair Maggard dissented from the Majority Report. There are very few property management businesses in Bakersfield the size someone makes a living from it, and he would like to set a threshold for application of the business license tax so the casual renter of commercial or residential property would be exempt. Committee Chair Maggard stated he does not think the majority report recommendation applies the law fairly. If people are in the property management business or renting/leasing properties such as the March 13, 2002, 4:32pm ADMINISTRATIVE REPORT Marketplace or Valley Plaza, they should have a business license because they are clearly in the business of managing properties. In contrast, there are many people in Bakersfield who own a few residential rentals or a commercial property as passive investments that are not in the business of actively making a living managing or renting proPerties. Many of these are retirees and should not be subjected to having a business license and paying tax on gross rental income. The business license tax should not apply to passive rental of property, whether on a commercial or residential basis. It should apply at the purpose of the property. If someone leases a building to run a business, then they should have a business license to run that business, which pays for the services being received from the City. However, by subjecting the owner of the same building to a business license, there are two business liCenses for the same business and the services are being paid for twice. If the purpose of the property is residential, it does not consume the same level of City services as does a business and, therefore, the casual investor in residential property should not be subject to a business license because it is not a business. Therefore, the Minority Report recommends application of the business license tax for renting or leasing properties be applied to property management businesses who are clearly in the business of renting and leasing properties. And further, casual investors who own and rent or lease commercial or residential properties be exempt from the business license tax. S:~Damell~?.OO2Bud&FinanceCommittee~adminbusinesslicense.wpd March 13, 2002, 4:32prn CITY Of BAKERSFIELD BUDGET AND FINANCE COMMITTEE MAJORITY REPORT NO. 1-02 MARCH 20, 2002 TO: HONORABLE MAYOR AND CITY COUNCIL SUBJECT: BUSINESS LICENSE TAXES, MUNICIPAL CODE SECTION 5.02.010 (A) The.Budget and Finance Committee met on :December 6, 2001, January 17, and February 21, 2002 and carefully reviewed and considered the application of the business license tax to owners who rent or lease commercial or residential property. The City Attorney had concerns .regarding the equal protection issue when applying the ordinance. Norma;lly business licensing is based upon the nexus of the fact the public entity is providing services to businesses. If the City attempts to separate out "passive investments" and determine it should not be taxed, others paying the tax and receiving 'identical services could have a legal challenge that this is not equal application of the ordinance. Therefore, the City Attorney recommended to apply the business license tax to property owners who rent or lease commercial properties. For residential properties, he recommended to determine if a person owns four or more residential rental units (or some set number), that person is conducting a rental business and, therefore, subject to the business license tax, and ownership of less that four residential rental units shall not be subject to the business license tax. It was determined the business license tax has been in the Code for years and is not subject to Proposition 218. The Finance Director agreed with the City Attorney, but his reasoning was based upon the fact the business license ordinance is not regulatory; it is a revenue raising measure. The amount of revenue last year was approximately $20,563 from businesses BUDGET AND FINANCE COMMITTEE MAJORITY REPORT NO. 1-02 FEBRUARY 20, 2002 PAGE -2- that rent/lease properties. Current staff should be able to handle enforcement for 2002-03. The Finance Director recommended to apply the business license tax as broadly as we legally can to raise revenue. Committee Members Hanson and Salvaggio felt the method used to apply the tax needed to be fair and equitably enforced and agreed with the recommendation of the City Attorney. Therefore, the Majority Report recommends to apply the business license tax .to property owners who rent or lease commercial properties, and amend the existing ordinance for 'residential rentals to apply the business license tax to owners who rent or lease five or more units (four units or less would be exemPt from the business license tax). Respectfully submitted, Councilmember Harold W. Hanson Councilmember Mark C. Salvaggio S:~Damell~?.002Bud&FinanceCommittee~lajodtyRpt No 1-02.wpd CITY Of BAKERSFIELD BUDGET AND FINANCE COMMITTEE MINORITY REPORT NO. 1-02 MARCH 20, 2002 TO: HONORABLE MAYOR AND CITY COUNCIL SUBJECT: BUSINESS LICENSE TAXES, MUNICIPAL CODE SECTION 5.02.010 (A) The Budget and Finance Committee spent several meetings considering the issue of the application of the business license tax to investor who own and lease or rent commercial or resident properties. HOwever, with respect to his colleagues and staff, Committee Chair Maggard does not agree with the majority report recommendation. The research and legal analysis provided by the City Attorney is appreciated, but there must be some legally defensible, way to exempt the casual investor who owns- and leases or rents commercial or residential properties. According to the Internal Revenue SerVice, it requires more than 500 hours per year working on. an activity to constitute it as "active." The Finance Department needs to be commended for their efforts to find ways to. raise revenue. However, Committee Chair Maggard feels his job as a Councilmember is to make sure that it is done equitably and the citizens are represented appropriately. His charge is to bring 'balance between taxing to raise revenue and what is best for the community. .. There are very few property management businesses in Bakersfield the size someone makes a living from it, and there should be a threshold to exempt the casual investor in commercial or residential property. BUDGET AND ·FINANCE COMMITTEE MINORITY REPORT NO. 1-02 FEBRUARY 20, 2002 PAGE -2- If people are in the property management business or rentin¢leasing properties such as the Marketplace or Valley Plaza, they should have a business license 'because they are clearly in the business .of managing properties. In contrast, there are many people in Bakersfield who own a few residential rentals or a commercial property as passive investments thatare not in the business of actively making a living managing or · renting properties. Many of these are retirees and should not be subjected to having a business license and paying tax on gross rental .income. The business license tax should not apply to passive rental of property, whether on a commercial or residential-basis. It should apply at the purpose of the property. If someone leases a building to run a business, then they should have a business-license to run that business, which pays 'for the services being-received from the City. However, by subjecting the owner, of the same building to a business license, there are two business licenses for the same business and the services are being paid for twice. If the ·purpose of the property is ,residential, it does not.consume the same level of City·services as does a business and, therefore, the casual investor in residential property should not be subject to a business license because it is not a business. Therefore, the Minority Report recommends ,application of the business license tax for 'renting or leasing properties be applied to property management businesses who are clearly in the business of renting and leasing properties, and casual investors who own and rent or lease commercial or residential properties be exempt .from the business license tax. Respectfully submitted, Councilmember Mike Maggard S:~:)arnell~.002Bud&FinanceCommittee~Minority Rpt No 1-02,wpd ORDINANCE NO. ORDINANCE AMENDING ' SECTION 5.02.010(A) OF THE BAKERSFIELD MUNICIPAL CODE RELATING TO BUSINESS LICENSE TAXES BE IT ORDAINED by the Council of the City of Bakersfield as follows: SECTION 1. Section 5.02.010(A) of the Bakersfield Municipal Code is hereby amended to read as follows: 5.02.010 Definitions. A. "Business" includes professions, trades, and occupations and all and ,e. ve~ =~i~.of:ca!!.ir~.q whgther.,or~,n0t carrie.d on for profit. residential real lease °r whb'mana'~A SECTION 2, This Ordinance shall be posted in accordance with the provisions of the Bakersfield Municipal Code and shall become effective thi~ (30) days from and after the date of its passage. --oo0oo- I HEREBY CERTIFY that the foregoing Ordinance was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on by the following vote: AYES: COUNCIL MEMBER CARSON, BENHAM, MAGGARD, COUCH, HANSON, SULLIVAN, SALVAGGIO NOES: COUNCIL MEMBER ABSTAIN: COUNCIL MEMBER ABSENT: COUNCIL MEMBER CITY CLERK and EX OFFICIO of the Council of the City of Bakersfield APPROVED: By: HARVEY L. HALL, Mayor CITY OF BAKERSFIELD APPROVED AS TO FORM: BART J. THILTGEN City Attorney " ~' By: MICHAEL G. ALLFORD Deputy. City Attorney MGA:Isc C:~)ocuments and Settings~bdesca~ALocal Settings\'l:emp~5.02.010(A).BusUcTax.wpd February 27. 2002 ADMINISTRATIVE REPORT Page 2 The Budget and Finance Committee met on December 6, 2001, January 17, and February 2i, 2002. The Committee and staff reviewed the fairness issue at length and considered howto apply the business license tax to owners who rent or lease commercial or residential properties and still provide for the equal protection under the law issue. Staff surveyed several other cities, including the 10 usual survey cities. Eight of the 10 survey cities have a business license tax for leasing or renting of commercial and residential property. For residential properties, some of the cities provided for a minimum number of units allowed before the business license tax was applicable. The position of the City Attorney's Office in regard to this business license ordinance as currently written, the licensing is for use of the property for commercial concerns, and not related to the ownership interests of the property. The original concern of Mr. Leggio was their operation is a passive investment. From a legal standpoint, it was the City Attorney's opinion the investment is an ownership interest and is not a use interest. The City is actually taxing the use of the property as a use for commercial rentals. The City Attorney had concerns regarding the equal protection issue when applying the ordinance. Normally 'business licensing is based upon the nexus of the fact the public entity is providing services to businesses. If the City attempts to separate out "passive investments" and determine it should not be taxed, others paying the tax and receiving identical services could have a legal challenge that this is not equal application 'of the ordinance. Therefore, the City Attorney recommended to apply the business license tax to property owners who rent or lease commercial properties. For residential properties, he recommended to determine if a person owns four or more residential rental units (or some set number), that person is conducting a .rental businessand,_therefore, subject to the business_license_tax,_and ownership of less thatfour residential .... rental units shall not be subject to the business license tax. It was determined the business license tax has been in th_b.a,.Code for years and is not subJec..~t to prOposition 218. ..,,,., -- ~'~ ~ ~ i The _F i_n a_ _e_ r_ . reed with the city Attorney, but his reasoning was basej;i~on the fact the business licen .n2 e is.^n o .' !atory; it is a revenue raising measure. The a.o~unt of revenue last year was approximately $20,563 from"bu, sinesses that rent/lease properties. Curr.,eflt staff should be able to handle enfo n.t.f_or_2o._o2_-_0._3.- TheDirector recommended to apply/the business license tax as broadly as we legally can to raise revenue]~P.~ssive investment assessmerkVis a net income approach, while the City ordinance is based on gross receipts. City staff currently performs gross receipts audits at minimal cost. Audits on a basis other than gross receipts is more costly and, therefore, not practical. Committee Members Hanson and Salvaggio felt the method used to apply the tax needs to be fair and · equitably enforced and agreed with the recommendation of the City Attorney. Therefore, the Majority Report recommends to apply the business license tax to property owners who rent or lease commercial properties, and amend the existing ordinance for residential rentals to apply the business license tax to ownerS who rent or lease five or more units (four units or less would be exempt from the business license tax). Committee Chair Maggard dissented from the Majority Report. There are very few property management businesses in Bakersfield the size someone makes a living from it, and he would like to Set a threshold for application of the business license tax so the casual renter of commercial or residential property would be exempt. Committee Chair Maggard stated he does not think the majority report recommendation applies the law fairly. If people are in the property management business or renting/leasing properties such as the Marketplace or Valley Plaza, they should have a business license because they are clearly in the business March 13, 2002, 4:05pm CONFIDENTIAL - PROTECTED BY ATTORNEY. CLIENT AND ATTORNEY WORK-PRODUCT PRIVILEGES ME-MORANDU'M CITY ATTORNEY'S OFFICE January 30, 2002 TO: BUDGET & FINANCE COMMITTEE Mike Maggard - Chair Harold Hanson Mark Salvaggio · FROM: BART J. THILTGEN, City Attorney SUBJECT: BUSINESS LICENSE TAX In accordance with the direction of the Budget & Finance Committee, the following lists numerous alternatiVes to taxing of commercial and residential rental activities and an accompanying legal analysis. These alternatives are related to taxation. In order to clarify the legal analysis portion of the listing, the following applicable points and authorities are presented. 1) The levy and collection of business license taxes is a "municipal affair." (Fox Bakersfield Theatre Corporation v. City of Bakersfield, 36 Cal.2d 136 (1950).) 2) A city may enforce a licensing ordinance against a person doing business within the city where such ordinance was solely enacted to raise money for municipal purposes; such taxation is not excluded merely because the state has occupied the field of regulation. Moreover, a city business tax ordinance providing for criminal penalties in the form of fines, forfeitures and penalties is not invalid for that reason. (Arnke v. City of Berkeley, 185 CaI.App.2d 842 (1960).) 3) A city is constitutionally free to tax the business presence within its jurisdiction by reference to "taxable events" occurring there. (Fox Bakersfield Theatre Corporation, supra.) 4) The measure of taxation must not be "capricious, arbitrary or discriminatory." (Security Truck Line v. City of Monterey, 117 CaI.App.2d (1953).) A business tax may be 'based on the preceding year's calendar gross receipts. (Web Service Company, Inc. v. Spencer, 252 CaI.App.2d (1967).) BUDGET & FINANCE COMMITTEE January 30, 2002 Page 2 5) There is no requirement that an excise tax levied for revenue by a municipality be reasonable in amount. The only restrictions on the exercise of a power to impose a tax are the constitution, the charter for charter cities, and the statutes for general law cities. (Fox Bakersfield Theatre Corporation, supra.) There is, of course, the overriding limitation a tax may not be prohibitive or confiscatory. 6) In order for a municipality to properly tax an entity, the latter must have a substantial presence witl'iin the city's jurisdictional borders. (Mobil Oil Corporation v. Commissioner of Taxes, 445 U.S. 425 (1980).) '7) No constitutional rights are violated if the burden of a license tax falls equally on all members of a class, though other classes have lighter burdens or are wholly exempt. The classification must be reasonable, must be based on substantial differences between the pursuits separately grouped and must not be arbitrary. (See, U.S. Constitution, Amendment XIV (equal protection clause); Fox BakerSfield Theatre Corporation, supra.) 8) Any increase in taxes .imposed by a municipality must be approved by the voters (general tax increase requires majority approval; special tax requires two-thirds voter approval). (See, California Constitution, Article XIII C (Proposition 218).) 9) Bakersfield Municipal Code section 5.02.010(A), which defines "business" to include "professions, trades, and occupation and all and every kind of calling whether or not carried on for profit" is a "catch-all" provision designed to ensure that certain businesses do not escape local taxation simply because they are not otherwise expressly specified within a taxing ordinance. (See, generally, Rexall Drug Co. v. Peterson (City of Los Angeles), 113 Cal.App.2d 528 (1952); Programming-Enterprises, Inc. v. City ofLosAngeles), 215 Cal.App.3d 281 (1989).) 10) Bakersfield Municipal Code section 5.02 is consistent with the principle that a local tax ordinance is not required to specifically identify and enumerate each and every business activity subject to taxation. (Edwards v. City of Los Angeles, 48 Cal.App.2d 62, 68 (1941).) Indeed, the rental of property has repeatedly been recognized as a "business" for purposes of local business license taxation. (See, e.g., Clark v. City of San Pablo, 270 Cal.App.2d 121, 126 (1969); City of Berkeley v. Cukierman, 14 Cai.App.4th 1331, 1339 (1993).) Nor may a taxpayer escape the local tax consequences of his/her treatment of certain receipts on federal and state income tax returns. (Indep. Casting Television, Inc. v. City of Los Angeles, 49 Cal.App.3d 502, 508-509 (1975) - any person seeking to avoid taxation for property rental receipts may be required to produce federal and state tax returns establishing that rental receipts were not treated as "gross income" for federal and state taxation purposes, and that expenses associated with the rental activity were not treated as deductions.) BUDGET & FINANCE COMMITTEE January 30, 2002 Page 3 ALTERNATIVES 1) Exempt from taxation the commercial rental businesses when ownership is based upon a passive investment. A: Subject to challenge by other commercial rental businesses as unequal taxation of members of the same class of business in violation of U.S. Constitution (equal protection clause) without a substantial difference between the underlying business pursuit (commercial space rental) [challenge would likely prevail]. 2) Exempt all "passive investment" operations from taxation. A: Subject to challenge on equal protection basis with no rational basis for-exemption [challenge-would likely prevail]. [Practical Effect: significant potential revenue loss based upon potential reclassification of businesses to conform to IRS passive investment standards.] [Administrative Effect: would require staff auditing based upon IRS tax laws versus current audit of only "gross receipts."] [Legal Effect: loss of local autonomy in taxation by linking to federal standards which are subject to change.] 3) Exempt from taxation commercial rental business unless a property manager is used to operate the business. A: Same challenge as (1), above. 4) Exempt from taxation all commercial rental businesses. A: May be challenged on the basis that the business is not burdened with taxation while other businesses, which also use municipal services, must pay a tax. [City would most likely prevail, if a "rational basis" for this exemption can be shown (e.g., administrative convenience and expense 'in the collection or measurement of the tax).] [Practical Effect: loss of revenue to City which could impact provision of public. services.] '5) Exempt from taxation all residential rental business (single family residential). A: May be challenged 'by multi-family residential business under equal protection clause. [CitY likely to prevail.] [Practical Effect: some lost ~revenue.] 6) Exempt from taxation all R-1 and R-2 residential rental business. A: Same as (4), above, but R-2 based on square footage rather than number of units and may be deemed arbitrary. 7) Exempt from taxation three (3) or fewer residential unit rental businesses. - A: Subject to challenge from four-plex owners and commercial rental business. [If City makes finding that three or fewer is not a business and not a member of the residential rental business class, then City likely to prevail.] [NOTE: Can also exempt four (4) or fewer residential unit rental businesses with appropriate finding, to exempt four-plexes, three-plexes, duplexes and four single family units.] BUDGET & FINANCE COMMITTEE January 30, 2002 Page 4 8) Exempt from taxation all residential rental business. A:- Subject to challenge by commercial since multi-family and apartments construed as commercial in Bakersfield Municipal 'Code. [Challenge would likely prevail.] 9) Differential in tax rate between commercial and residential rentals. A: While may be challenged on basis of equal protection, City most likely would prevail if rational basis for differentiation established (e.g., lesser amount of general public services in residential area versus a commercial area). 10) Exempt. from taxation based upon number of commercial units being rented, square footage being rented, or some other criteria other than gross receipts. A: Subject to challenge on basis that tax does not fall equally on all members of the class (type of business) pursuant to equal protection. [Challenge would likely prevail.] 11) Establish differential ratesbased upon amount of gross receipts generated by the business (e.g., exempt under a certain amount; graduated tax as gross receipts increase or decrease; or some other criteria). A: Subject to challenge under equal protection and as discriminatory within same type of business (e.g., discrimination or protection of small businesses, no rational basis or nexus related to City service provision). [Challenge would likely prevail.] BJT:las cc: Gregory Klimko, Finance Director Bill Descary, Treasurer Darnell Haynes, Assistant to the City Manager S:\COUNCIL\MEMOS\BUSINESS LICENSE TAXES - BUDG&FIN 2.DOC CONFIDENTIAL - PROTECTED BY ATTORNEY. CLIENT AND ATTORNEY WORK-PRODUCT PRIVILEGES MEMORANDUM CITY ATTORNEY'S OFFICE January 9, 2002 TO: BUDGET & FINANCE COMMITTEE Mike Maggard - Chair Harold' Hanson Mark Salvaggio FROM: BART J. THILTGEN, City Attorney ,~ SUBJECT: Business License Taxes As per the direction of the Budget & Finance Committee at the meeting of December 6, 2001, this office is providing the Committee with additional information' concerning the application of business license taxes to commercial and residential rental properties. Attached are two (2) memoranda from Deputy City Attorney Michael AIIford which provide a synopsis of existing case and statutory law applicable to this issue, along with a discussion of "legal concerns" associated with the concept of exempting "passive investment" commercial properties from the requirement to pay a business license tax. As indicated in the memoranda, the Charter and Bakersfield Municipal Code both view the conducting of a business in very broad terms. Neither takes into consideration whether the "business" operates at a profit or what type (passive or active) of income is derived by the business. No reference is made to either federal or state income tax accounting criteria. Business license taxes are primarily applied to "gross receipts" (a few entities use a flat rate or some other method of equitably applying the law) and, therefore, no accounting criteria (depreciation, income, carryover losses, etc.) need to be reviewed, audited, etc. The primary consideration is that the tax be applied equally among like business. Different types of businesses may have differing tax rates based upon a rational relationship to the amount of public services required by the business. It is important to recognize that a business license tax is a revenue raising tax (versus regulatory) applied on the "privilege" to do business within the jurisdiction. In broad terms, a "business" can be viewed as one party providing on an ongoing basis a product BUDGET & FINANCE MMITTEE January 9, 2002 Page 2 (a material item or a service) to another party for a consideration (a fee, trade, foregoing a legal right, etc.). Statutorily, for certain specified products, a minimal number of transactions do not constitute a business (e.g., up to three automobiles sold by an individual in a year; sale of primary residences, etc.). The Committee requested this office to also provide a legally defensible standard with which to define a commercial or residential rental business. Using standards adopted by other cities, combined with the concept that a minimal number of annual transactions does not constitute a business, it is our opinion that the business license tax on residential rental properties legally could be applied when the property owner rented four or more separate properties/units. Thus, the owner of a single triplex or three individual homes would not be subject to the tax, but an owner of a four-plex (all four rented to individuals other than the owner) or four individual rental homes would be required to pay the tax. For commercial properties, it would be most defensible to include all properties, rather than have some standard of exemption, as commercial properties dramatically vary in size and type. For instance, if a similar criteria as residential rentals were to be used, a single property could have four offices, each containing 1000 square feet for a total of 4000 square feet, and would be subject to the tax, while another single unit property could have 40,000 square feet and not be subject to the tax. Even more extreme, the owner of the single 40,000 square foot building could also own and rent two other parcels, each containing 40,000 square feet, and still not be subject to the tax. When such a scenario is considered, it becomes obvious why taxing entities choose the "gross receipts" standard for taxability. While this issue originally surfaced as a result of a "passive" investor asserting it was not in a business, it is asserted by this office that the commercial property rental is a business, as broadly defined, and to not apply the tax to that business could be challenged by other taxpayers as an unequal application of the laws. The rental of the property (a fee for the service of providing commercial space) is the business. The fact the owners of the property consider such ownership a passive investment, by'Internal Revenue Service criteria, does not, in my opinion, change the commercial nature of the use of the property. BJT:las S:\COUNCIL\MEMOS\BUSINESS LICENSE TAXES -- BUDG&FIN.DOC Attachments CONFIDENTIAL . PROTECTED BY- ATTORNEY/CLIENT AND ATTORNEY WORK PRODUCT PRIVILEGES MEMORANDUM ClTY A TTORNEY'S OFFICE December 11, 2001 TO: BART THILTGEN, CITY ATTORNEY FROM: MICHAEL G. ALLFORD, DEPUTY CITY ATTORNEY SUBJECT: LOCAL BUSINESS LICENSE CERTIFICATES California Government Code section 37101 permits the legislative body of a city to license,~ for revenue, every kind of lawful business transacted in the City. Section 12 of the Charter of the City of Bakersfield authorizes adoption of ordinances and regulations relative to the levy and collection of taxes. The Charter further permits the City, for purposes of regulation and revenue, to "license all persons, corporations and associations engaged in any business, occupation, profession or trade" carried on within its jurisdictional boundaries. Whether or not state law has occupied the field of regulation, cities may tax businesses carried on within their boundaries and enforce such taxes by requiring Business Licenses for revenue and by criminal penalty. (See Brabant v. Southgate (1977) 66 Cal.App.3d 764.) Bakersfield Municipal Code ("BMC") section 5.02.010(E) defines a "business" to include professions, trades and occupations and all and every kind of callin.q whether or not carried on for profit. "Persons" includes all domestic and foreign corporations, associations, partnerships of every kind, and individuals transacting and carrying on business in the City, other than as an employee. Chapter 5.02 makes clear that it is enacted solely to raise revenue for municipal purposes, and is not intended for regulation. (BMC § 5.02.020.) ~ License taxes are also termed "privilege" or "occupation" taxes and are levied upon the exercise of a privilege, business or vocation within the boundaries of the municipality. Bart J. Thiltgen, C. Attorney December 11, 2001 Page 2 Section 5.02.060 holds that it is unlawful for any "person" to transact and carry on any business in the City without first having procured a Business Tax Certificate. Section 5.02.090 illustrates various acts which may be indicia of "doing business" in the City of Bakersfield. In the present instance, it is apparent that "Truxtun Business Plaza" or some entity/person associated therewith collects regular lease payments from tenants in exchange for which a service is provided (i.e., office space for commercial purposes). The ongoing leasehold transactions between a corporate property owner 'and multiple commercial~ tenants, whether an intermediary (property managedleasing agent) is used or not, constitutes the transaction of business which is subject to the business license requirement of Chapter 5.02. Chartered cities and towns are specifically authorized by the California Constitution to impose license taxes for revenue purposes and are subject only to Charter limitations on that power. (See Cal. Const. Art. XI, Section 5(a); see Bakersfield Charter Section 12.) Local business license taxes for revenue purposes are not in conflict with state regulatory measures and are valid unless specifically prohibited by the Charter. (9 Witkin, Summary of Cal. Law (9th Ed.) §§ 264, 265.) It is well settled that the power to tax for revenue purposes, including license taxes, is a municipal affair within the meaning of the Home Rule Constitution provision. The levy and collection of taxes is ao"municipal affair." (Fox Bakersfield Theater Corporation v. City of Bakersfield (1950) 36 Cal.2d 136.) A city may enforce a licensing ordinance against a "person" doing business within the city where such ordinance was solely enacted to raise money for municipal purposes. Moreover, a city business tax ordinance providing for criminal penalties in the form of fines, forfeitures and penalties is not invalid for that reason. (Amke v. City of Berkeley (1960) 185 CaI.App.2d 842.) A business license tax is intended' to increase revenue by imposing a tax upon those who pursue their business within the municipality and thereby derive benefits from the advantages afforded by the CitY. The word "business" is applied in the licensing context in the broadest possible terms. For example, the word 'business' includes, with a few possible exceptions, all manner of occupations or means by which persons earn a livelihood. (In re Diehl (1908) 8 Cal..App. 51.) "Business" is that which occupies the time, attention or labor of men for the purpose of profit or improvements; it may be said to embrace all things necessary to be done to fully accomplish the purpose implied by the undertaking. (In re Smith (1917) 33 Cai.App. 161.) The term "business" as used in law imposing a license tax on businesses, trades, professions, and callings, ordinarily means business in trade or commercial sense, one carried on with view to profit or livelihood.' (Newport Bldg. Corp. v. Santa Ana (1962) 210 CaI.App.2d 771; Long v. Anaheim (1967) 255 CaI.App.2d 191.) Bart J. Thiltgen, C~ ~.ttorney December 11, 2001 Page 3 There is no authority for the argument that the "business" transacted be the sole, primary or a substantial source of income/livelihood to the "person" as a condition precedent to imposition of a business license tax. The .practice of law is included within the statutes granting City's authority to raise revenue by levying a license fee or tax "on any business" within the limits of the. City. A business license tax measured by or according to "gross receipts" is specifically provided for in California Revenue and Taxation Code section 17041.5. ("This section shall not be construed so as to prohibit the levy or collection of any otherwise authorized license tax upon a business measured by or according to gross receipts.") This is the predominant method of tax calculation in California. (See memorandum of Bill Descary/Cheryl Simpson.) City of Los Angeles v. Shell Off Company (1971) 4 Cal.3d 108 is the pre- eminent California Supreme Court ruling which permits a city to base its business license tax on the entity's gross receipts attributable to its business activities within the city? It is for the "privilege" of doing business within the jurisdictional boundaries of the City for which the business license tax is collected. State law clearly recognizes that certain advantages inure to the transaction of business within a municipality for which business license taxes may be constitutionally collected so long as the license tax is "revenue raising" in purpose so as to reimburse the City for the costs it incurs providing public services to businesses within its jurisdictional boundaries (e.g., "a general business license tax with a higher rate for take-out food establishments, to compensate for increased litter collection" is permissible). Gutknecht v. Sa.usafito (1974) 43 CaI.App.3d 269 Relevant to. the definition of "doing business," none of the eight comparable cities surveyed which imposed a business license tax link the calculation of the tax to the profitability, income or IRS distinction between "active" versus "passive" investment. Rather, all base the license fee upon the "gross receipts" received by the business, regardless of its form, unless specifically exempted by state or federal law (e.g., legally recognized "non-profit" organization). MGA:Isc Attachment S:\Treasury\Corr~BJT.BusinessLicenseTaxes.doc 2 "As long as local license taxes upon businesses doing business both within and outside the taxing jurisdiction are apportioned in a manner by which the measure of tax fairly reflects that proportion of the taxed activity which is actually carried on within the taxing jurisdiction, no constitutional objection appears." (Supra at p.109.) CONFIDENTIAL - PROTECTED BY ATTORNEY/CLIENT AND ATTORNEY WORK PRODUCT PRIVILEGES MEMORANDUM CITY ATTORNEY'S OFFICE December.18, 2001 TO: BART THILTGEN, CITY ATTORNEY SUBJECT: BUSINESS LICENSE TAXES This memorandum is submitted in conjunction with my prior memo of December 11,2001 on this subject. INQUIRY At the Budget and Finance Committee meeting of December 6, 2001, a proposal was made to exempt "passive" investments (businesses) as defined by Internal Revenue Service regulations from application of the City's business license tax ordinance (B.M.C. Chapter 5.02) in the area of leasing of commercial and/or residential property. For all the reasons discussed at the committee meeting, in the prior memos and as set forth herein, it is recommended this proposal not be given effect. ANALYSIS AND DISCUSSION Were the proposal to be given effect, the City would not only forego a potentially significant source of revenue, it would also incur a significant expenditure of staff time to audit and monitor the so-called "passive" investment businesses and, perhaps of greater concern, abrogate its Charter autonomy in an area of municipal authority which is distinctly "local" in character for no appreciable gain. Seventy four businesses which presently lease out commercial/residential space in Bakersfield possess business license certificates. The City receives $20,563 in license taxes on $1201209,933 gross receipts (tax rate 30¢ per thousand gross receipts). It is not known at present how many of these businesses, other than Truxtun Business Plaza, would qualify for license exemption were the proposal to be given effect. Bart J. Thiltgen, City .~ ,rney December 18, 2001 Page 2 I.R.S. regulation (section 469(c)) defines "passive" activity as "any activity which involves the conduct of any trade or business in which the taxpayer does not materially participate." For income tax purposes, "passive" activity includes any rental activity except the taxpayer who personally performs more than one-half of all the personal services required by the real estate business and who expends at least 750 hours of personal service during each taxable year on the real estate business. (§ 469(c)(7)(B).) The City does not maintain sufficient staff in order to audit/monitor those businesses claiming such an exemption. For this analysis, it is important to keep in mind the differences between Internal Revenue Service regulations for income tax purposes as opposed to municipal ordinances authorizing the receipt of revenue (business license tax) for the privilege of conducting a "business" within the jurisdictional boundaries of a municipal er-~tity. I.R.S. regulations (commencing at 26 U.S.C. § 1) define and classify businesses in numerous categories for "tax-exempt," "tax-deferred"- and "taxable" income purposes. In stark contrast thereto, business license taxes are not concerned with "income" (which is usually determined subsequent to deductions for other business-related expenses) but rather the "gross receipts" of the business which is theoretically, at least in part, derived as a result of the privilege of doing business within the boundaries of the municipality. The City does not tax the "income" generated from the business operations, but merely seeks to recover revenues for municipal services provided to businesses which operate within its jurisdiction. Whether the business is classified as "active" or "passive" for I.R.S. tax purposes does not impact City's duty to provide municipal services to the businesses nor affect its legitimate right to recover the reasonable, proportionate costs of those municipal services in the form of business license taxes. At present, no city in California which impoSes a business license tax ("BLT") calculates the tax due on the basis of the "income" of the business. The predominate method for calculation of a BLT is the "gross receipts" of the business (as authorized by statute) followed by a "flat" fee, "base" fee and "per-employee" fee or Some combination thereof. For cities with populations in excess of 100,000, the "gross receipts" methodology for tax calculation is again by far the most common utilized.' LEGAL CONCERN~ Classifying a business as a "passive" investment under the I.R.S. regulations is but one form of several such business classifications. Exempting such businesses from the City's business license tax requires a "reasonable basis" if the City is to avoid "due process" and "equal protection" claims. The business classified as a "passive" investment under I.R.S. regulations may use the same or more municipal services provided 'to businesses classified as "active" investments or other business California Municipal Business Tax Association, 2000. Bart J. Thiltgen, City I rney December 18, 2001 Page 3 classifications which are not exempt from local business license taxes. Simply stated, the I.R.S. classification as a "passive" investment bears little, if any, appreciable relationship to its need for and use of municipal services, particularly when compared to businesses classified as "active" investments. The City could defend an exemption under its business license tax ordinance for residential lessors of four or less units as is recognized by several comparable cities (e.g., Fresno - 4 residential units and up require a business license certificate; Oxnard and Ontario - 3 or more residential units require a business license certificate). This is generally considered to be "de minimis" leasing activity. In contrast, the Truxtun Business Plaza (also called "passive" investment/business)operates the commercial center at the southeast corner of Truxtun Avenue Extension and Office Park Drive with at least 12 commercial tenants. MGA:Isc S:\Treasury\Corr\BJT.BusinessLicenseTaxes.doc BAKERSFIELD CITY MANAGER'S OFFICE MEMORANDUM January 4, 2002 TO: Alan Tandy, City Manager FROM: John W. Stinso~istant City Manager SUBJECT: February 5, 2001 Budget and Finance Committee discussion and recommendation regarding Bakersfield Senior Center Housing Project. Per your request I am providing the following documents related to the February 5, 2001 Budget and Finance Committee meeting discussion and recommendation regarding the Bakersfield Senior Center Housing Project. Attachment 1: Memo dated 2/1/01 from Donna Kunz re. Bakersfield Senior Center request for financial assistance for senior housing project which was included in the February 5, 2001 Budget and Finance Committee agenda packet. Attachment 2: Agenda Summary Report for February 5, 2001 Budget and Finance Committee meeting. These show that staff was to meet with the applicants and assist them in working out financing for the additional funds requested. They also note that when completed the staffwould forward the appropriate documents related to this project to the City Council for approval. (Council Committees do not have authority to approve project agreements of this financial magnitude. They may however, make recommendations for approval to the City Council who has the ultimate authority to authorize approval of such agreements between the City and another party.) Attachment 3: Budget and Finance Committee notes for the 2/5/01 meeting by Assistant to the City Manager, Damell Haynes. These notes reflect that staff was interested in working out the financial terms of the project since there were currently no housing set aside funds available. It was also noted that Lynn Edwards was interested in meeting with Vernon Strong to work on the details of the project. The committee also recommended a City contribution of $280,000 initially and the balance was to be worked out subsequent to the meeting. (After staff meetings with the representatives from the Senior Center and subsequent review by the Budget and Finance Committee in October, the $280,000 of HOME funds was included with other HOME funds in the Council's approval of the revised project at it's October 24a' Council meeting.) Attachment 4: Transcript frOm the tape recording of the meeting. SSJOHN~&F 2-5-02 Senior Cente~ Housing.wpd B A K E R S F I E L D Economic and Community Development Department MEMORANDUM February 1, 2001 TO: Donna Kunz, Economic Development Director FROM: George Gonzales,~(;~r~/~unity Development Coordinator SUBJECT: Councilmember Carson's referral of the Bakersfield Senior Center (BSC) request for financial assistance to the Budget and Finance Commiffee. The Bakersfield Senior Center (BSC) and the Retirement Housing Foundation (Long Beach) co-applicants for a HUD Section 202 grant award of $6.75 million, have submitted a letter requesting financial ~ssistance for their proposed 80-unit low-income senior project at 624 4t~ Street. The original Section 202 application submitted to HUD identified the 1.79 acre site adjacent to the existing Senior Center. The applicant's now are requesting financial assistance totaling $560,000 to develop 6 parcels north of the existing site and shift the project site approximately 110 feet north. This shift will allow the existing recreation building and parking lot to remain. The 6 parcels are developed with three single-family residences, a triplex, and a four-plex. The proposed assistance will be used for acquisition, relocation of 10 tenants, and the demolition of 7 buildings located on the properties. Staff has met with the applicants and have indicated that HOME funds are not currently available, however alternate funding sources will be reviewed and coordinated with BSC. dlk:P:\GEORGE\bakersfield senior center fin assist memo. WPD Januapy 17, 2001 Mr. Alan Tandy, City Manager City of Bakersfield 1501 Truxtun Avenue Bakersfield, California 93301 RE: Senior Housing Center 530 4t~ Street Bakersfield, CA Dear Mr. Tandy: The Bakersfield Senior Center in conjunction with The Bakersfield Senior Center Housing Project respectfully request financial assistance from the City of Bakersfield inorder to acquire the additional land necessary to develop 80 low income units of housing for the elderly. More specifically, the complex will consist of 79 one bedroom units and 1 two bedroom unit to accommodate the on site manager. Other improvements of the complex include a recreation area, laundry facility, special visiting rooms and a secure green garden area, as well as, off street parking to accommodate residents, visitors and employees. The award notification to the Retirement Housing Foundation (Long Beach), co- applicants of this approved project, stated that $6,770, 500 has been reserved for this project along with a Project Rental Assistance Contract and budget authority of $272,900 and $1,364,500 respectively. Formal acceptance of the notification constitutes a certification and agreement by the Sponsor that: 1. The grant cannot be assigned, sold, conveyed or otherwise transferred. 2. The fund reservation will be cancelled if the project does not proceed according to a precise schedule. 3. The funds are subject to cancellation if(HUD) becomes aware of pre-existing conflict of interest. 4. Site control must be evident at every contractual stage of this agreement, although some exceptions may occur during the initial stages. 5. The Section 202 capital advance and project rental assistance funds reserved for the project identified herein may not be used for any other purpose and in connection with any other project except as stated in the contract. The proposed sile is located on "R" Street, 4~t' and 5t~ Street, in Bakersfield. The amount ot'property, which is the subject of this acquisition proposal'- including the vacated portion of Sth Street - is approximately 1.40 acres. When this 1.40 acres is added to the existing site of i.79 acres, the total property available for development will be 3.19 acres. If the portion of the property, which now comprises the recreation building and adjoining parking lot, remains and continues to be used for the same purpose, the available land let't for development will be approximately 2.69 acres. The total amount of funds necessary to accomplish this acquisition is $560,182.00. Each cost that comprises this amount has been indentified on the accompanying matrix. Also, lhe accompanying booklet serves as reference and further explains the individual cost that has been identified: On behalf of the Bakersfield Senior Center's Board of Directors, I respectfully hope that the City staff finds it in their discretion to recommend approval of this request as soon as possible, as time is of the essence. Respectfully Submitted, " Lynn Edwards Director ol'Bakerst'ield Senior Center ~' i ~oo .................. , ..... ',: ............... "' - -345-7334 _,. SCALE IN 1/1 O OF AN INCH ....... . ................ VILLA BLK. E- LOWELL ADDFI'ION-LOWELL PARK TRACT ..-,.c~L ~./-/ ,-40 BLK. 3 UNION ADDITION (~) ,y 'l "l 6T/~ 0 I ' ' ' I " ® ' '" I I I " I I I ,~ ',[ - '~' ¢3 UNION ..,r ADDfTION BAKERSFIELB Alan Tandy, City Manager Harold Hanson Staff: Darnell Haynes Mark Salvaggio AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, February 5, 2001 4:00 p.m. City Manager's Conference Room 1. ROLL CALL Call to Order at 4:08 p.m. Present: Councilmembers Mike Maggard, Chair; Harold Hanson and Mark Salvaggio 2. ADOPT AUGUST 11, 2000 AGENDA SUMMARY REPORT Adopted as submitted. 3. PUBLIC STATEMENTS 4. NEW BUSINESS A. Discussion and Committee recommendation regarding Bakersfield Senior Housing Project on Fourth Street and CDBG/HOME/Housing Set Aside financial assistance Economic/Community Development Director Donna Kurtz explained that this request is for an additional $280,000 bringing the applicants total request to $560,000..CHDO funds are available for the first request for $280,000 to build 80 Iow-income units of housing for seniors. The applicants are now requesting an additional $280,000 for acquisition of adjoining lots to shift the project 110 feet north. This shift will allow the existing recreation building, after school programs and parking lot to remain. .Staff has met with the applicants and is recommending positive consideration of the extra land purchase; however, all of the HOME allocations for next year are pre-committed, so we do not have a budget on hand to accommodate this request in the form of a cash grant. Staff requested the Committee's concurrence to work with the applicants to structure some kind of financing plan (a note Or loan) to allow them to proceed and then phasing the funding when it is available. Mr. Lynn Edwards and Mr. Vernon Strong spoke regarding their project. The Bakersfield Senior Center and. Retirement Housing Foundation, co-applicants, received their entitlement for a HUD Section 202 grant award of $6.75 million in November 2000. Time is an issue as HUD established a time frame of 18 months for the project to be completed. ADOPTED AS SIIEHII"I'RD HARCE 8, 2001 AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, February 5, 2001 Page -2- The Committee unanimously approved allocating $280,000 of CHDO funds for the Bakersfield Senior Housing Project and directed staff to meet with the applicants to assist them in working out some type of financing for the additional $280,000 being requested. When completed, the Committee directed staff to prepare and forward the documents to the City Council. B, Discussion and Committee recommendation regarding amendment to KCEOC Agreement/ CDBG Action Plan On December 13, 2000, the City Council approved an agreement with Kern County Economic Opportunity Corporation (KC EOC) for $255,000 for acquisition of an 18 acre parcel on Washington Street and Feliz Drive. The'property has been annexed to the City and escrow will be closing in two to three weeks. This amendment is for the second installment approved by the Council last year as part of the Action Plan, which provides $275,000 of additional CDBG funds toward the design, engineering and construction of the facility. Approval of this amendment will keep the project moving forward. It was noted that the City's Property Manager is working with KCEOC on their relocation, as it will free up the current location for additional Centennial Garden parking. The Committee unanimously approved the amendment, which will increase the agreement to $530,000. Staff was directed to complete the amendment to the agreement and forward to the Council for approval. C. Discussion and Committee recommendation regarding request received from Bethany Services for-the City to consider transferring ownership of the Bakersfield Homeless Center, 1600 E. Truxtun Avenue, to Bethany Services The City received a request from Bethany Services to transfer the ownership of the Bakersfield Homeless Center to them. In 1990, Bethany Services, a non-profit corporation, entered into a lease agreement with the City to lease the Homeless Center from the City for an annual rent of $1.00 for the purpose of providing food, emergency shelter and transitional services to the homeless. Mr. Louis Gill spoke regarding their request. Bethany Services would like to have ownership of the facility in order to purchase land and expand the facility to accommodate the increase of single women with children and families by providing larger segregated areas. Ownership of the property would allow them to obtain financing for the expansion and establish a line of credit for operating expenses. Economic Development Director Donna Kunz stated that staff is recommending approval of their request, but recommended covenants or restrictions be added to the deed because the original source of funding was block grants that are restricted to Iow and moderate individuals, and services for the homeless were allowed. Mr. Gill stated that the loan they will be applying for has some df the same restrictions and their long-term plans are to provide services to the homeless. The Committee unanimously approved Bethany Services' request to convey ownership of the Bakersfield Homeless Center property to them, but directed staff to meet with Bethany Services staff and their bank lenders to work out language that will allow approval of their loan, continued use as a homeless center and an equity share provision on any future sale of the property. After the details are work out, staff was directed to prepare and forward the documents to the City Council. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, February 5, 2001 Page -3- D. Discussion and Committee recommendation regarding request from Bruce Dolgin for Conditional Use ~Permit exception to operate Sno-Shack shaved ice kiosks in C-1 zones Mr. Bruce Dolgin spoke regarding his request to continue operating his Sno-Shack shaved ice kiosks in a C-1 zone. Last year, he thought the ordinance had been changed to allow operating in a C-1 zone as stated in the first reading, but at the second reading of the ordinance, it was. changed to a C-2 (which corrected an error). Due to the confusion, the City issued a temporary conditional use permit for last year so he could operate at two Rite Aid locations, which were received well and very successful. Although his business falls under a transient business with the City, he feels his business locations are established over a long-term and he would like to see a change in the ordinance to allow him to continue operating his two locations in the C-1 zone. Staff explained that Transient Outdoor Businesses are allowed to operate in C-2 or less restrictive zones and when the term of the ordinance was changed from 90 to 180 days, it was always intended that it remain in a C-2 zone. However, due to the confusion between the first and second reading of the ordinance and to resolve the situation last season, Mr. Dolgin was granted, at no cost to him, two 180- day Cond!tional Use Permits (CUPs) that expired at the end of October. A CUP could be issued that would allow Mr. Dolgin to keep operating his two sites in their present C-1 zone, with notification to residents within 300 feet of the site. However, it is very expensive, $1,325 per location. The Committee did not want to impair the integrity of the zoning ordinance or go through the process of amending the ordinance. Due to the original confusion, the Committee recommended that Mr. Dolgin reapply for the CUP's and that the City absorb half of the cost. Mr. Dolgin agreed with the recommendation. The Committee unanimously approved the recommendation and directed staff to follow through with Mr. Dolgin. E. Committee discussion and adoption of 2001 Budget and Finance Committee meeting schedule, The Committee unanimously adopted the calendar, with the provision that if scheduling conflicts occur, meetings can be canceled and rescheduled at the direction of the Committee Chair. F. Committee review and recommendation on financial and audit reports: 1. Comprehensive Annual Financial Report (CAFR) (This item has previously been approved by the Council to meet legal reporting dates.) Finance Director Gregory Klimko briefed the Committee. It was noted that the format of the CAFR will be changing dramatically due to the implementation of GASB 34 (Government Accounting Standards Board) to put government entities on more of a measurable basis with private business. The reporting will stay the same for the coming year, but will change format for FY 2001-02. Committee Chair Maggard stated it was discussed a year ago the possibility of changing the governmental fund accounting method that we use on accounting for Centennial Garden activities. The Finance Director explained that with the implementation of GASB 34 a year from now, it will be presented differently, more of an enterprise fund - propriety fund accounting. However, when this new accounting format is implemented, there will be a downside as it will make it appear in the General Fund like it has huge losses, when in fact it balances every year. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, February 5, 2001 Page -4- The Committee unanimously accepted the audit report as filed. 2, Centennial Garden Financial Statements (This item has previously been approved by the Council to meet legal reporting dates.) The Finance Director gave an overview of the financial operations of the Garden. The financial picture, which does not include the debt service or depreciation, is improving every year. The Convention Center operated with losses every year. With the opening of Centennial Garden and contracting with professional management (currently SMG), the net loss for last year was $227,000; net loss the prior year was $594,000, the year before with City management of the Convention Center the operating loss was $1,137,000, for an improvement of approximately $90O,0OO. Committee Chair Maggard stated he has concerns that in the City's financial statement we don't match the debt service payment against the revenues from the operation of the Center. It was discussed that there are revenues attributable to the Garden, as the City can now book many large events, that a financial statement does not articulate, such as Transient Occupancy Tax generated, sales tax, nearby redevelopment opportunities, visitors to local restaurants and retail shops, and other revenues that are not quantifiable. Committee Chair Maggard stated that perhaps it would serve to have a memo for reference to answer questions-that could show the financial progress the City has made to lower the deficit or a spreadsheet, and show some of the other benefits the City receives. It was discussed that the City has not had a year since the Garden was constructed in which the Citydid not adjust the size of staff to deal with increased population, there have been no cutbacks or restrictions in normal business activities and the Garden was absorbed without detriment to any City operations. The Committee unanimously accepted the audit report as filed. 3. Independent Auditor's Report on Compliance with Contractual Requirements relative to the Bakersfield Subregional Wastewater Management Plan for FY ended June 30, 2000, This is a compliance audit which is required as part of an agreement between the City and the County service agencies. It provides a measurement that the City is in compliance with the Wastewater Management Plan. The Committee unanimously accepted the audit report and it was forwarded to the Council. 4, 1999-00 Transportation Development Act Funds Financial Statements Public Works staff gave a brief overview. Kern COG contracts with an accounting firm to provide a compliance audit of all the agencies that receive Transportation Development Act Funds. This includes Article 3 and Article 8 funds. It was noted that Article 3 money can be applied for every year and used for the. Bike Path, which has been done in the past, and Article 8 money is being used for maintenance at the Amtrak Station. The Committee unanimously accepted the audit report and it was forwarded to the Council. 5. ADJOURNMENT The meeting adjourned at 5:20 p.m. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Monday, February 5, 2001 Page -5- Staff present: Mayor Harvey L. Hall; City Manager Alan Tandy; City Attorney Bart Thiltgen; Assistant City Manager Alan Christensen; Finance Director Gregory Klimko; Assistant to the City Manager Darnell Haynes; Economic/Community Development Director Donna Kunz; Community Development Coordinator George Gonzales; Interim Public Works Director Jack LaRochelle; Planning Director Stan Grady; Assistant Finance Director Nelson Smith; Treasurer Bill Descary; Deputy City Attorney Allen Shaw; Assistant to the Public Works Director Georgina Lorenzi; and Economic/Community Development Business Manager Rhonda Barnhard. Others present: James Burger, the Bakersfield Californian; Louis Gill, Bakersfield Homeless Center; Bruce Dolgin, Sno-Shack; Kevin Ray, KCEOC; Lynn Edwards, Bakersfield Senior Center; Vernon Strong and Valerie Strong, Bakersfield Senior Center Project. cc: Honorable Mayor and City Council DWH:jp S:/Damell/2001 BFCommittee/bf0 lfeb05summa~y.wl3d BUDGET AND FINANCE COMMITI'EE Monday, February 5, 2001 4:00 p.m. City Manager's Conference Room Transcript 4. NEW BUSINESS A. Discussion and Committee recommendation regarding Bakersfield Senior Housing Project on Fourth Street and CDBG/HOME/Housing Set Aside financial assistance Donna Kurtz: This first item is concerning an additional budget request from $280,000 to $560,000 from the Bakersfield Senior Housing project developer. What it amounts to is, they have made a request to purchase some additional land and actually physically move the project over by a block. And, by doing that they would be acquiring some private land. Unfortunately, at this time all of our HOME allocation for next year is pre- committed, so we don't have a budget on hand to accommodate this request in the form of a cash grant like we did on the initial $280,000. What we are asking today is your concurrence to work with this group to structure some kind of a financial or financing plan with them to allow us to proceed. It makes very good sense what they are proposing for the project. We need to take a look at their per forma and take a look at the cost again with this new request, but we would probably need to structure a note situation or something of that with the Senior Center owners, so they will carryback some of that first trust deed and so forth to be able to provide some of those funds. And then, possibly over a longer term give back some payment towards that in some tax increment Iow-mod set aside monies or from other HOME funds in future years. But right now, the agency and the City does not have any housing set aside funds available to just grant another addition to this. Mark Salvaggio: Donna, could you clarify that and go over that again. Did you say we have given them already $280,000? Donna Kunz: There is a commitment for $280,000 that was part of their 202, correct? George Gonzales: They had asked for $280,000 at that time. Donna Kunz: Yes. Mark Salvaggio: For the same project? Donna Kunz: Yes. And now the project is physically changing its location by a block. Mark Salvaggio: Yes. But, we approved that $280,000? Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -2- Donna Kunz: Ah, it's been negotiated, but it is not been, all the documentation is under preparation. Mark Salvaggio: Do we have the funds to cover that? Donna Kunz: Yes, that we do have, we have a line for it as a CHDO. We have a line. It is an eligible cost under our HOME program. And they're an eligible for what we call community housing development organization. So, we can use the CHDO line item. Mark Salvaggio: Okay. Alan Tandy Clarification purposes? Excuse me. You are recommending positive consideration of the request? Donna Kunz:? Uh-huh. Harold Hanson: Donna, I know nothing about this process, coming out of.the private sector. But, is this normal, this type of thing? When I say normal, does this happen all over the State? United States of America, I mean. These kinds of considerations? Donna Kunz: Oh, absolutely. Physically; when you are restricting the rent on an affordable housing project, you are basically reducing the cash flow, so the project won't need subsidies to make it a viable development for anybody to basically operate it in a positive cash environment. What we get in exchange for that, and it is required by the development law, is a long-term affordability covenant on those units to provide affordable housing to the term of the plan. So, that's the purpose of the housing set aside fund, is to create those long-term affordability opportunities and senior housing is a very good way to do that. Harold Hanson: So, is the money coming out of the General Fund? Donna Kunz:- No. The City receives a block grant from the Federal Government and part of the block grant is a section called HOME. It's been around for about 6 or 7 years now, actually. And, I believe we get about $1.2 million, or close to that amount each year. And, a portion of that has to be set aside for community-based housing development organizations. And, the balance of it is typically used for land acquisition. That's the preferred use for affordable housing projects. Alan Tandy: The two sources of money that could be involved in this are both only eligible for housing projects. It could be non-senior housing-it could be Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -3- first-time home buyers. It could be other housing projects. But, they are monies that come to us with either State or Federal restrictions, which say that these monies can only be used for housing unit projects and nothing else. Mike Maggard: Have we not gone through some years where we didn't have programs. Alan Tandy: We have in fact gone through years Mike Maggard: When we have had money we could not spend. So, this is a nice problem. Harold Hanson: Okay. Mike Maggard: We are making the community better with money that does not cost us anything. It's just a cash flow problem. We have it now, versus have it later, right? Donna Kunz: We have done some very large __ __ __ senior projects. So, it is just that they happen to all come in at the same time. Mike Maggard: So, will we basically loan them something out of the rest of our budget and then we will be paid back next year? Or, how does the mechanism work? Donna Kunz: Initially, the $280,000 will be a line item and we will have that cash available 'to give to them at the time they close their escrow. Mike Maggard: The $280,000? Donna Kunz: Right. What I am going to be recommending and we have not sat down and exactly negotiated with them yet, but would be to structure for them to carry a loan on the property that they are actually selling into the project, or on a portion of it at least. And then we would pay back a system of repayment of that loan Over a period of time, say four or five years as we start receiving in new HOME funds or 20% set aside money off the project area. Mike Maggard; And would our assistance with that loan not exceed an additional $28O,000? Donna Kunz: The total together, there would be another about, would be a total of about $560,000, but for the difference would have to be in the form of a loan because we do not have any other cash resources. Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -4- Mike Maggard: I just want to make sure it's clear to everyone. This isn't- the first deal did not change and now they are asking for more money to do the first deal. It's just expanded and it is a lot larger project. Donna Kunz: Actually, they are changing the deal. Initially, they were not going to be acquiring this additional block of private property. They were just going to purchase the land from the Senior Center. Mike Maggard: Right. But, it isn't another $280,000 to do.the same first deal we loaned them $280,000 on. It's an extra $280,000 to do a much larger deal. Donna Kunz: Right. There's not going to be any more units. They physically actually moved the project out farther, so that the services that are in the Senior Center are still in place, now. Which .is actually a better project if you think about the planning of it. There are going to be services next to it and they are taking out, there's some interesting stuff'beside the project that probably would be a tough development, but Alan Tandy: There are two or three things, and Lynn and Vernon can speak to this as well, but we have some problem neighbors in some of the family apartments that don't always want to see build brand new senior units and other social problems. They have some traffic egress problems because they are across from the school, and there's certain times of day with seniors trying' to come in and out in conflict with that school - that heavy school traffic. And, then they operate in one of their buildings - the City actually operates, the Recreation and Parks Department, an afterschool program, which has been very heavily attended and if you tear out that building, you would not have any place to move the afterschool program. And by moving this project to the north, my understanding is that building will remain on site. We will be able to continue afterschool programs, which, I don't see a Parks and Rec person here, but I'm thinking is one of our most heavily attended programs in the City - I am quite sure I can say that safely. Mark Salvaggio: Two things, so staff is in agreement with the applicant that the extra land that they need is warranted? You don't have any difference of opinion over that? Donna Kunz: No. We have no difference of opinion. The project actually Mark Salvaggio: And, number two, could you name some of the things that we are doing. Other projects where this money is already committed. So, people know that we care about - you mentioned we have some big things. Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -5- Donna Kunz: Well, we recently funded, in fact the grand opening is.happening George Gonzales: It's the Golden Empire Affordable Home Senior Housing, Park Place. Mark Salvaggio: So, if we do not have these monies, where have they gone? Just name me a few. Senior Citizen housing? Mike Maggard: Canyon Hills? Is there a senior housing project up there that is in line. George Gonzales: Well, they are in line, but they are not at a point where they can use the money. Mark Salvaggio: Okay. What others? George Gonzales: There's Senior Housing. The Downtown Senior Housing. Alan Tandy:~ City Center and Golden Empire Park Place. Mark Salvaggio: Okay, so there's those two, the Golden Empire and City Center. Harold Hanson: A quick question. On the $280,000 that in effect we are borrowing from funds that we will probably receive in two years. Are we impacting future growth because of this type of thing? I mean you don't pull $280,000 today and by the time two years rolls around and we have pulled another $300 or $400,000, if we do this type of thing, then the monies coming in, there's nothing available, except to repay a debt. Alan Tandy: The HOME monies are sort of a subset of the block grant and it has been fairly traditional and normal to phase funding for bigger projects over more that one year. The medical facility we did down on Lakeview, the assistance we are providing KCEOC, George, you can probably ramble off 8 or 10, but, it is quite common for us for a couple of reasons. Number one, because the paperwork takes such a long time on Federal money. It's usually drug out and it's kind of a matter of convenience to go for more than one year. Harold Hanson: I don't have a problem with it. I'm just trying to get a better feel, that's all. Donna Kunz: It's better leveraging for money and every five years we have to put together a Consolidated Plan, which pretty much, there's a need to supplement on the types of housing and this one senior housing was identified and there were, I don't know' how many resulting today, Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -6- 1,300 needed in the next five years. Mike Maggard: I only have one last question. There was a long line last year of folks that wanted CHDO funds and we turned some away and thought we would have .more money available down the road. How is it lining up? Do we think we call fulfill all of the requests? Donna Kunz: Absolutely not. There are probably 10 to, this is not unusual, every City has the same issue. There are always, the needs are 10 times what the amount of funds available are. Basically, staff will do an analysis and you'll be asked to make some type of decision. Mike Maggard: So, I would ask you then to comment on, if, and certainly I'm looking for a way to make this work and not looking for a way to get in the way, but how will we anticipate answering questions of those that were here last year asking for CHDO funds for their project, if this takes out of that pie? How will we answer those questions as to why there is not money for them -this year? Donna Kunz: The justification I would give on this particular project is they already received their 202, correct? They have an entitlement of a bond type Iow interest financing already lined up. You've already made a commitment to their initial project, pretty much of $280,000. They , need site control. They are ready to go. It makes sense because we are also under the gun and have drawing requirements on these Federal funds. They can't just sit out there. Mike Maggard: And others are not ready to go? Donna Kunz: No, and in a lot of the CHDO situations, they're new, a Iotof them are relative new organizations and they need to gain experience. And I am not saying that they are not qualified, but this is a very large project and we are leveraging a small amount of dollars to get 80 units. That's a lot of units for the dollars. Mike Maggard: And there's no reason why we could not be creative with a subsequent deal, like we are with this one trying to match up funds when they are not quite available yet. Donna Kunz: Right. Mike Maggard: Okay. Do we have.a motion? Mark Salvaggio: So moved. -Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4,A Page -7- Mike Maggard: Do we have seconds? All in favor, please say "aye." Harold Hanson: Aye. Mark Salvaggio: Aye. Mike Maggard: Thank you very much. Lynn Edwards: I was hoping we would have a chance to say something. Mike Maggard: And, you can certainly do that and we can vote again, if you prefer us to do that. (Laughter) Lynn Edwards: Just a couple of questions. To the Council, every time I have been here, we have been meeting with the staff two or three times already explaining it and we have put out a booklet that some of you may have there explaining the project. Just for information, we have received a commitment from HUD of $6.7 million to do the project. Our initial plan was to leave it there, but after some consideration and discussion, a better plan would be to move the project north as the Director has said, because of the school across the street. And ! am sure you are aware of the problems around schools. And this being a magnate school, has a lot of traffic there and it would have been really unjust to ask the seniors to try to drive through that in the morning and in the afternoon when there is all those busses coming in and out and all those ~ trucks and so forth. But anyway, the $280,000, that's a new figure for me and I am just wondering when that $280,000 was committed. Vernon have you heard about the $280,000? Vernon Strong: Just let me ask this. I been __ this. If Community Development staff is willing to get with us and specifically explain what it is and how these funds will be prioritized and how that relates as to whether funds are available to people who are standing in line the same as we are, or how the policy, how does the staff decide whether or not, you know, how to prioritize those projects that are being funded as opposed to those projects Which are contingent upon something happening. And I think probably if we got with the Community Development staff, we could work those things out. And have Community Development answer those questions. I would be satisfied. Alan Tandy: We are not talking about leaving you in a gray area with respect to the certainty of the funding. We are talking about taking care of your Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -8- need and assuring and guaranteeing you that the need will be met. Lynn Edwards: My argument isn't with the thing with the . It's-just some information that came to my attention - the $280,000 - that is a figure that Ihave not heard in any of the meetings prior to today. Alan Tandy: She has been here a week and a half or two weeks and I believe she is talking about staff work papers as opposed to a Council commitment. Before we come to this Committee, where we have money in different columns. Lynn Edwards: Beyond that, other remarks would be that we have a time line that HUD put up for us that from November of last year, 18 months to meet all of everything that HUD says you have to do, or we lose the grant. And, the clock, started in November, whatever date in November it was, we have 18 months to do this and so I was a little concerned about some of the discussiOn about the way part of your funding would be in next year's budget, which means funds won't be available until 2002. Sometime in '02 for the balance of it. That would certainly make it difficult for us to meet any kind of time line. Perhaps the best thing would be, as Vernon says, that we meet with the Director and her staff and try to see where we are on that. Vernon Strong: We could meet right away. Tomorrow? Donna Kunz: We will set up a meeting with you right away. Whatever your pleasure. Mark Salvaggio: I need clarification here. Explain, Alan, what you were saying, working papers versus Alan Tandy: I don't believe the Council or Committee has taken an action on this request before, and Mark Salvaggio: So, the first $280,000 is not in the bag then, officially. Alan Tandy: After this Committee vote Mark Salvaggio: But, the second $280,000 we will be referring to the Council has been committed? Alan Tandy: No, actually this is the first Mark Salvaggio: So the Committee will recommend the $280,000 today Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -9- Alan Tandy: Recommend the whole package Mike Maggard: The $560,000. Mark Salvaggio: $280,000 right away and phasing on the balance. Alan Tandy: Yes, phasing on the balance. Mark Salvaggio: Do you understand that now? Lynn Edwards: Yes, I understand that. I guess the only thing I need is HUD requires us to have site control before they will move forward.. If the action of the Committee and the Council, subsequent to this, is such that we can show HUD that we have site control then the drawings, the architectural drawings and all those things can happen. But, the architect can't do anything until there is site control. So, if we can come up with some sort of statement from the City saying that we are committed to go and everything will happen in time, then I am pleased. Alan Tandy: If you can get together with the ED/CD staff, we'll see if we can't get it on the next agenda - a week from Wednesday. Lynn Edwards: I am going to leave you a Mike Maggard: I would like to let you know when you could expect it on the Council agenda. It's likely to be Alan Tandy: It will be the next regular meeting. Mike Maggard: Okay. George Gonzales: Well, we will have to finish the environmental. Donna Kunz: It is in process at this time. So, it might be the following meeting. Alan Tandy: The 28th? Okay the 28th. Donna Kunz: As soon as we can. Mike Maggard: And we can make the staff of the housing project aware of it, right? .. Donna Kurtz: We can do that. Budget and Finance Committee Meeting Monday, February 5, 2001 Transcript - NEW BUSINESS 4.A Page -10- Mike Maggard: Okay, thank you very much - thanks everybody. S:\Damell~.O01 BFCom m ittee\transcript020501 .wpd Chronological Detail of Bakersfield Senior Center - Senior Housing Project Feb 1, 2001 - Staffmemo to D Kunz - memo information that indicates a meeting was held between BSC and G Gonzales requesting funds in the amount of $560,000, staff indication to applicants that current HOME funds are not available, alternate funding sources will be explored for consideration. (memo in file) Feb 5, 2001 - report to Budget and Finance Committee on status of project request and shortage of current Home funds, directed by Budget and Finance committee to work with BSC to explore funding alternatives. (report on file) Feb 16, 2001 - Meeting between Lynn Edwards, Vernon Strong, D Kunz and staff to discuss documentation and information needed from BSC to prepare final financial recommendation to Budget and Finance Committee. Staff identified the potential use of CHODO funds and indicated BSC would need to be a certified CHODO organization. (letter in file) Feb 22, 2001 - Letter sent to Lynn Edwards from D Kunz, recapping meeting and detailing list of information needed to complete review of project and information needed for CHODO certification. (letter in file) February 23,2001 - staff calls to Lynn Edwards requesting acknowledgment of his intent to continue project. (letter reference in file to calls) March 21,2001 - Letter from Lynn Edwards to D Kunz, brief note stating intent to pursue funding for project. (letter in file) July 5, 2001 - Followup letter to Lynn Edwards, recapping February letter for information request with an August deadline to submit information to staff due to other CHODO funding requests. (letter in file) July 23, 2001 - Staff Meeting with Lynn Edwards, Dr. Lark and Vernon Strong to review information needed and identified in the letter sent July 5. July 25, 2001 - Correspondence letter to Lynn Edwards acknowledging receipt of partial information requested and outlining remaining documentation needed. (letter in file) August 31, 2001 - Correspondence to Lynn Edwards - letter restating missing documents still needed for organization certification as a CHODO. September ? - meeting with Vernon Strong, Dr. Lark reviewing initial CHODO application forms (Mr. Strong completed the County's application forms and submitted to EDCD.) Discussion that staff would offer three alternatives for Budget and Finance committee to consider at next meeting. September ? - letter from Dr. Lark to D Kunz with missing CHODO documentation attached. September 18, 2001 - Staff report to Budget and Finance Committee providing three project scenarios and financial alternatives for committee consideration. Committee approval of alternative to expanded site, City to acquire site and provide relocation services using staff. October 11, 2001 - letter to Dr. Lark, acknowledging CHODO application is complete and approved. October 2001 - City Council.approval of Project October 26, 2001 - letter to HUD concerning request from BSC for federal waivers concerning procurement of consultant for real estate services and for uniform relocation guidelines variance from federal procedures. December 5, 2001 - draft project agreement sent to Dr. Lark. December 12. 2001 - Response from HUD stating City requirement to follow Federal Relocation Guidelines and HUD opinion on consultant procurement procedures - defer to City's procurement policies concerning sole source use and waiver restrictions. December 18, 2001 - BCS response to initial draft agreement January 3, 2002 - Response to Dr. Lark on various points of the agreement. JO N F RR R This is the 70th Season of the Bakersfield Music Director Symphony Orchestra and it is filled with colorful, Saturday, March 9, 2002 - 7:30 p.m. exciting and powerful music. Each concert features Sponsored by Texaco, lnG. John Farrer has been the music director of the Bakersfield Symphony for 26 years. He is also the music ~~-- ,~"--~-~,r~____~]' - 60 to 80 highly skilled, professional musicians Distinguished vocal soloists and director of the Roswell Symphony in New Mexico, the // ~\[~ ~, employed by the Symphony to perform some of the the Maste rworks Chorale join the Santa Maria Philharmonic, and has also been associated /~~)~0 O-1-,//~.\ ,// world's finest music. Most of our music ions live in BSO to commemorate the lOOth 2 0 0 2 Bakersfield, many teach music, while some have anniversary of Verdi's death with with the San Francisco Symphony as cover conductor for performances of some of the great the orchestra's subscription concerts. Farrer has been a other careers. A portion of the orchestra travels Italian composer's most beloved frequent speaker in the San Francisco's series of Inside from the Los Angeles area to perform with the compositions. Music talks, and has led the Orchestra in Concerts for Bakersfield Symphony Orchestra. Kids, and in a program at the Stern Grove which attracted Program will include famous We hope that you will join us for the 2001-2002 Season. Our new schedule makes selections from La Traviata, Aida, 20,000 listeners. attending the symphony a night on the town. New time, new days, new prices... Discover Rigoletto, Otello, and more. Maestro Farrer is a frequent guest with orchestras in the Symphony. England, including the London Philharmonic Royal Philharmonic, Bournemouth Symphony, English Sinfonia and London Mozart Players. His all-Tchaikovsky recording with the London Philharmonic Orchestra received critical praise and led to recordings of Saturday, April 13, 2002 - 7:30 p.m. Dvorak with the Royal Philharmonic. Farrer's eighth compact disc recording, Music of Thursday, October 4, 2001 - 7:30 p.m. Sponsored by Aero Energy, LLC Ernst Van Dohnany, will be released by ASV Records in October. ~' Sponsored by Chevron Corporation Young violin star Axel Strauss joins the BSO in mesmerizing works by As senior guest conductor of the English Sinfonia, Farrer has toured with the orchestra The Bakersfield Symphony Orchestra will open its 70th season with Vaughan Williams and Ravel. throughout England and Northern France. His three recordings of English string music some of the best music written for films. Leonard Nimoy of Star Trek The orchestra is spotlighted in Shostakovich's epic Symphony No. 5. with that ensemble have been widely praised. Maestro Farrer is on the faculty of the fame will narrate this exciting program. Scheduled works include: American Symphony Orchestra League's conducting workshops, is a member of the Beethoven ............................................................... Prometheus Overture Goldsmith ..................................................... Star Trek: The Movie Suite Vaughan Williams ...................................................... The Lark Ascending League's Standing Committee on Artistic Affairs and a member of the Los Angeles Young ~!?~ i~ Williams .......................................... Close Encounters of the Third Kind Ravel ............................................................................................. Tzigane Musicians Foundation Music Advisory Board. In New Mexico, he received the Governor's Award for Excellence and Achievement, the highest arts honor. Herrmann ................................................................ North by Northwest Soloist: Axel Strauss Copland ............................................................................ The Red Pony L. Bernstein ............................................................... On the Waterfront Shostakovich .................................................................. Symphony No. 5 Korngold ................................................................. The Sea Hawk Suite THREE WAYS TO SUBSCRIBE Saturday, May 11, 2002 - 7:30 p.m. 1. CALL- Charge by phone (661) 323-7928. Sponsored by Castle & Cooke 2. MAIL - Fill in the order form and send with your check or credit card information to: Thursday, November 15, 2001 - 7:30 p.m. Bakersfield Symphony Orchestra, 1328 34th Street, Suite A, Bakersfield, CA 93301. Join us for a special concert featuring the brilliant New 3. FAX - Fax completed order form to (661) 323-7331. Sponsored by Frank Ghezzi Century Saxophone Quartet in a serious work by Peter Marimba virtuoso Nanae Mimura will dazzle us with performances of Schickele. The Bakersfield Symphony Orchestra concludes the season with Mahler's magnificent BENEFITSOF MEMBERSHIP works by Creston and Sarasate. Don't miss this unusual and exciting Symphony No. 1, "The Titan." · Personal Assistance: You order your tickets from symphony staff; no waiting in general box event! office lines. Season tickets are mailed to subscribers approximately one month before the first Mozart ........................... The Marriage of Figaro Overture concert of the season. Mendelssohn ............................................................. Ruy Bias Overture Schickele ...................... Concerto for Saxophone Quartet Creston ...................................... Concertina for Marimba and Orchestra · Priority Seating: Best available seats at a discount over single ticket prices. Sarasate ......................................................................... Zigeunerweisen Soloists: New Century Saxophone Ouartet · Priority Ticket Purchase: You have the opportunity to purchase tickets for special concerts before Soloist: Nanae Mimura Mahler ................................................... Symphony No. 1 [ they go on sale to the general public assuring the best seats. Sibelius ........................................................................ Symphony No. 2 · Free Pre-Concert Lectures: Thirty minutes prior to each concert, enjoy an insightful and entertaining introduction to the music, composers and guest artists by Dr. Jerome Kleinsasser, of California State University, Bakersfield. · Symphony Kids: Free, creative care is available for children (infants through 10 year olds) during THE NUTCRACKER Sponsoc Rain for Rent the concerts. The child care center, just down the hall from the auditorium, is staffed by the Saturday, February 9, 2002 - 7:30 p.m. The Bakersfield Symphony Orchestra and Civic Dance Center will perform the beautiful music of Community Connection for Child Care. For information, call 861-5202. Tchaikovsky and magical dancing to bring the story of the Nutcracker to life. Sponsored by the Vance Family Trust Friday, December 7, 7:30pm · Saturday, December 8, 1pm & 7:30pm· Sunday, December 9, 1pm · Restaurant Discounts: On concert evenings, season ticket holders also enjoy special discounts at Noted Gershwin specialist Jeffrey Siegel will serenade us with a HOLIDAY POPS Presented by: Mercedes Benz of Bakersfield Sponsor: Texaco, Inc. local restaurants, including select downtown restaurants. performance of the famous Concerto in E The BSO will play A holiday music extravaganza featuring the Symphony with the Bakersfield Prokofiev's stunning score to Romeo and Juliet. Masterworks Chorale in a program sure to delight the entire family. ~ JOIN THE CONDUCTOR'S CIRCLE Tuesday, December 18, 7:30pm ~ A donation of $500 or more entitles you to membership in the Conductor's Circle. As a member of Massenet ...................................................................... Phedre Overture BEETHOVEN, UP CLOSE AND PERSONAL the Conductor's Circle, you are invited to attend a complimentary wine and cheese reception during Gershwin ........................................................................... Concerto in F Sponsor: Dr. & Mrs. Matthew Malerich intermission at each concert. Soloist: Jeffrey Siegel i Season ticket holders will be treated to a lecture/recital by William Kinderman, The musical arts are alive and well in Kern County thanks to symphony patrons. Your support helps one of the world's foremost experts on Beethoven. Mr. Kinderman will perform us attain the highest standard in artists achievements while enriching our youth through Prokofiev .................................................. Romeo and Juliet Suite No. 1 the composer's superlative Diabelli Variations and Piano Sonata Opus 111. educational outreach programs. Please consider a donation along with your ticket order to ensure Sunday, February 17, 2002, 4pm quality performances and continued educational programs for our community. t Cover Painting by Kandis Peake llf~ · ~.~ I I ~ :--~ I '~ ~~ / / / / / / ' ~ r ~i ~ k / ' ~ ~ / I~ I ' I ~ I ~ I I //'. I /~ / /' / From the fi~t ~nce w gr~tion ~ Fwm ~Ik ~ the a~k to a stmtl in the ~r[ our li~s ~e al~s ~em ~com~nied ~ the mgk o frolic. And t~t~ mhy ~re Fo~ to Mlp our loml s~phon~ Classical Music National Public Radio News Special Programs Educational Information VALLEY PUBLIC RADIO For more information or a Program Guide Call 1-800-275-0764 For The Finest In S & S Printing Mexican Food~o~ Fine Quality Printing 606 Center Street E_XIC L_I ....... :?:?~i~:~i~hdaY through Friday ..... :??~?00 a,m. - 5:00 p.m. 327-3861 :::::::::::::::::::::::::: :i ...... Downtown 'i::iiii}}}i?? Lee Smith 327-5201 Stockdale West 5601 California Ave. lr GARDEN DISTRICT F L O W E R S ... is pleased to provide fresh boutonnieres for the orchestra. STOCKDALE HWY. AT COFFEE RD., BAKERSFIELD, CA. (661) 834-9200 There's No Business Like Joe's Business! Penny-Pinchin' Prices Trader Joe's has everyday low prices. No sales and no gimmicks. Just great prices. We only carry an item if we can have the best everyday low price in town against other grocers. We buy direct from suppliers, cut out the middlemen, and pass the savings on to you. Old Fashioned Basics We know it's important to have the essentials on hand, including eggs, milk, pasta, flour and bottled water, to name a few. When you buy your basics at Trader Joe's, your grocery dollar goes further so you can afford to enjoy the extras. New Fangled Favorites Trek through our aisles to find unique foods and beverages. Around every comer you '11 find interesting and delicious products lurking, just waiting'to find a good home like yours. We want to encourage you to try our new products, so we sample them regularly. And keep in mind our product guarantee: We tried it. We liked it. If you don't like it, bring it back for a refund or exchange. A visit to Trader Joe's can be overwhelming - so many terrific products, so many new things to look at, so many decisions to make. It's easy to come in for your favorites and overlook many other products you might be surprised we have. Come with us on a little tour of things you may have missed. Did You Know We Have... · Soy beverages and other non-dairy beverages · Organic products, everything from produce to marinara sauce to snacks · Vitamins and supplements · Food for your cats and dogs · Fresh fish selection · More than 15 whole bean coffees and a world-class selection of teas What's the one thing that distinguishes this wide assortment of high quality products? VALUE. Value for our customers is the goal for all Trader Joe's crew members - we work hard at it. We ask you to do your comparison shopping ~ you'll let us know whether or not we're doing a good job. TRADER J OE'$ 8200 Stockdale Highway Town & Country Shopping Center (661) 837-8863 Open 9-9 Daily .always have! We don't just talk about quality we deliver it everyday, literally. Whether it's at our two locations or right to your door. We've been providing quality drycleaning to Kern County for 90 years. Give us a call and let us deliver quality to you. MUSIC DIRECTOR do. 70th CONCERT SEASON FELIX ADAMO 2001 John Farrer has been the music director of the Bakersfield Symphony for 26 years. He is also music director of the Roswell Symphony Orchestra and the Santa Maria Philharmonic. He has been associated with the San Francisco Symphony as a cover conductor for the Orchestra's subscription concerts. Mr. Farrer has been a speaker in the San Francisco Symphony's series of Inside Music talks, has led the Orchestra in Concerts for Kids, and participated in a program at the Stem Grove which attracted 20,000 listeners. Mr. Farter is also a frequent guest with orchestras in England. His seven recordings with the London Philharmonic, Royal Philharmonic, Boumemouth Symphony and English Sinfonia have received high praise from critics around the world. A new CD, "Music of Ernst yon Dohnanyi", will be released on the ASU label in October, 2001. As senior guest conductor of the English Sinfonia, Mr. Farter has toured with the orchestra throughout England and Northern France. His three recordings of English string music with that ensemble have received wide acclaim. Mr. Farrer is on the faculty of the American Symphony Orchestra League's conducting workshops, and is a member of the League's Standing Committee on Artistic Affairs. He is a member of the Music Advisory Committee of the Young Musicians Foundation of Los Angeles. In addition, Mr. Farrer has received the Governor's Award for Excellence and Achievement, New Mexico's highest honor. The BakersfieldS~M~'~'PHONY Friends helping YOUTH r~ie.ds celebrate a li£e. Concert Schedule 2001-2002 Season Funeral Home SUNDAY, NOVEMBER 18 Cemetery SUNDAY, APRIL 7 Cremation Gardens Funeral Pre-Plans SUNDAY, JUNE 16 Mausoleum Stockdale High School Flower Shop 2800 Buena Vista Road 4:00 PM HILL R: ~ Admission:S6 Memorial Pa~k & Mo~kua:~y Tick¢~$ arc available from www,hillcrcstmcmorial,¢om or thc door, For more information ~D i g,p,i~,y' Call (661) 323-4407 The Guild House is available for meetings, special events, luncheons and weddings. The Guild House is staffed completely by volunteers and all proceeds go to support the GOURMET LUNCHEONS Henrietta Weill Memorial Child ., . ' ~ :.. ~_ ...;, .:.;,,~... Guidance Clinic. · _..- ..;.-.. ~",.,. . '.' '~ :" 1905 Eighteenth Street · ~ ' ~-' Bakersfield, CA ~~~_ September-June . . Monday - Friday · II ~.: ' ;? ,," ll:30am- l:30pm '~~7 Reservations Recommended _.. 325-5478 c2001- 00 COrtC(I T $(/15OH MUSIC FROM THE SILVER SCREEN Thursday, October 4, 2001 - 7:30 p.m. Sponsored by Chevron The Bakersfield Symphony Orchestra will open its 70th season with some of the best music written for films. Leonard Nimoy of Star Trek fame will narrate this exciting program. Scheduled works include: Goldsmith .................... Star Trek: The Movie Suite Williams ...................... Close Encounters of the Third Kind Herrmann .................... North by Northwest Copland ....................... The Red Pony L. Bernstein ................. On the Waterfront Korngold ...................... The Sea Hawk Suite PERCUSSION EXTRAVAGANZA Thursday, November 15, 2001 - 7:30 p.m. Sponsored by Frank Ghezzi Marimba virtuoso Nanae Mimura will dazzle us with performances of works by Creston and Sarasate. Don't miss this unusual and exciting event! Mendelssohn ...............Ruy Bias Overture Creston ........................ Concertino for Marimba and Orchestra Sarasate ....................... Zigeunerweisen Soloist: Nanae Mimura Sibelius ........................ Symphony No. 2 ROMANTIC INTERLUDE Saturday, February 9, 2002 - 7:30 p.m. Sponsored by the Vance Family Trust Noted Gershwin specialist Jeffrey Siegel will serenade us with a performance of the famous Concerto in F. The BSO will play Prokofiev's stunning score to Romeo and Juliet. Massenet ..................... Phedre Overture Gershwin ..................... Concerto in F Soloist: Jeffrey Siegel Prokofiev ..................... Romeo and Juliet Suite No. 1 A VERdi CeLebratiON Saturday, March 9, 2002 - 7:30 p.m. Sponsored by Texaco, Inc. Distinguished vocal soloists and the Masterworks Chorale join the BSO to commemorate the 100th anniversary of Verdi's death with performances of some of the great Italian composer's most beloved compositions. Program will include famous selections from La Traviata, Aida, Rigoletto, Otello, and more. 2001-2002 COI"IC RT SO:lSOr,I VIOLIN SPECTACULAR Saturday, April 13, 2002 - 7:30 p.m. Sponsored by Aera Energy LLC Young violin star Axel Strauss joins the BSO in mesmerizing works by Vaughan Williams and Ravel. The orchestra is spotlighted in Shostakovich's epic Symphony No. 5. Beethoven .................... Prometheus Overture Vaughan Williams ........ The Lark Ascending Ravel ............................ Tzigane Soloist: Axel Strauss Shostakovich ................ Symphony No. 5 NEW CENTURY SAXOPHONE OUARTET Saturday, May 11, 2002 - 7:30 p.m. Sponsored by Castle & Cooke Join us for a special concert featuring the brilliant New Century Saxophone Quartet in a serious work by Peter Schickele. The Bakersfield Symphony Orchestra concludes the season with Mahler's magnificent Symphony No. 1, "The Titan." Mozart .......................... The Marriage of Figaro Overture Schickele ...................... Concerto for Saxophone Quartet Soloists: New Century Saxophone Quartet Mahler. ......................... Symphony No. 1 SP(CI L CO C(RTS THE NUTCRACKER BEETHOVEN, UP CLOSE Bakersfield Symphony Orchestra AND PERSONAL and Civic Dance Center Bakersfield Convention Center BakersfieM Convention Center Sunday, February 17 - 4:00 p.m. Friday, December 7 - 7:00 p.m. Saturday, December 8 - 10:00 a.m./4:00 p.m. NEW DIRECTIONS Sunday, December 9 - 1:00 p.m. Olive Drive Church Sunday, November 11 - 4:00 p.m. Mercedes Benz of Bakersfield presents Sunday, February 24 - 4:00 p.m. HOLIDAY POPS Bakersfield ConventiOn Center Tuesday, December 18 - 7:30 p.m. 2001-2002 Season Cover Painting by Kandice Peake BAKERSFIELD YOUTH SYMPHONY Stockdale High School Sunday, November 18 - 4:00 p.m. Season Ticket Holders have the opportunity Sunday, April 7 - 4:00 p.m. to purchase tickets for special concerts Sunday, June 16 - 4:00 p.m. before they go on sale to the general public! Helping You See Your Way To A Whole New Life 4649 Pla~z Road Compreheus,wEyeCu , sio Co io 833-4040 M~i~ & Sugi~ Tr~ment Com~ S~iflist Full Se~i~ Opfiml Boutique Contact ~n~s G~go~ A. S~ner ~, EA.C.S. Gle~ A. Kap~eH~, O.D. ~ Che~ A. W~e~en, O.D. *Symphony Member MEDIC~ ASS~IA~S If you are unable to attend one of the concerts, share your ticket with a friend or neighbor or call the Symphony office to donate your ticket. We'll find another buyer and give you a tax credit for the face value of your ticket. For more information, call 323-7928. If you find the number of your seat hidden in this coqcert program, your next season ticket will be FREE! It could be hidden in one of the advertisements (which financially support this program) or within the editorial material. If you are the lucky winner, please call the Symphony Office, 323-7928, within five days of this concert, to claim your free reservation for the 2002-2003 season. for high speedonline fun! Road Runner is instant, one-click,access t0ihe best of broadband. D(~wnload your favorite tunes in seconds onto a custom-made CD. Preview summer blocl~buster movies and click on tickets vs. waiting in lin'e. Get up-to-'~he-minute insights on mutual funds Or the cheapest air- fares. With Road Runner's super-fast, cable-based network, nothing's holding you back. There's no more waiting, like on dial-up. Plus there's no 10ng-term contract and if you're not thrilled after 30 days, we'll refund your money. C2001- 00 FRERDS OF Tl'f SYMP OFIY MEMBERS Nancy Johnson Maestro's Circle ($10,000+) Nile and Elizabeth Kinney James Collier Mrs. Thomas Leigh Ed Hopple Lynne Ludeke MacGregor Texaco, Inc. Mr. and Mrs. Richard Major Mr. and Mrs. Milton Younger Sally Matychowiak Mr. and Mrs. George McJannet Platinum Baton Circle ($5000-9000) Mr. and Mrs. Leroy Neher Aera Energy LLC Deborah Oakes Chevron Products Company Mr. and Mrs. Calvin Parker Frank Ghezzi Mr. and Mrs. Larry Peake Grimmway Enterprises Mary Frances Porter Eleanor Heiskell · Beverly Potter George and Karen Johnson Meg and John Pryor Paramount Farms Dr. Howard and Joyce Quilling Buryl and Marilyn Vance Helen Rummelsburg Edward and Colleen Shuler Gold Baton Circle ($2500-4999) Phillip and Norma Sexton Castle & Cooke, Inc. Paulette Shires Joan and Ray Dezember Mr. and Mrs. Don Simpson Diane Lake Perri J. Stinson Don and Paula Lindsay Union Bank of California Dr. and Mrs. Matthew Malerich Urner's Dr. Tony Perelli-Minetti Mark and Bonnie Van Voorhis Walter Mortensen Insurance Silver Baton Circle ($1000-2499) James and Evelyn Weddle Millie Ablin Mr. and Mrs. Carl Woody Doreen Austin BP Amoco Foundation Patron ($250-499) Mr. and Mrs. Donald Barnes Mr. and Mrs. William Brady Dr. and Mrs. Donald Comforth Mr. and Mrs. Morton Brown Dr. and Mrs. Philip Davis Virginia C. Church J.D. Heiskell & Co, Inc. Mr. and Mrs. Doug Davis Dr. and Mrs. Gordon Johnson Donald Deininger Mr. and Mrs. Byron Kilpatrick Kurt Finburg Charles Lambourne · Mrs. John Fomey Mr. and Mrs. Lyman Linfesty Dr. R. Claire Friend Ron and Nancy Marvin Toni Gallardo Mr. and Mrs. Richard Murray Harvey Hall Barbara Patrick Dr. and Mrs. Tetsuo Ishimori Randy Rowles Dr. and Mrs. James Johnston Diane Sandidge Dr. Jerome Kleinsasser Dr. and Mrs. John Sherman Dr. and Mrs. Erik Michelsen Mr. And Mrs. Richard Southwick Mr. and Mrs. Cliff Shaw Mr. And Mrs. Robert Thomas Three-Way Chevrolet Supporting Member ($100-249) W. A. Thompson, Inc. Mr. and Mrs. David Albizo, Jr. WestAmerica Bank Dr. and Mrs. John Almklov Margaret Wilson Doug Autrey Helen W~ndes ~ ' Dr. Thomhs Banks Mr. and Mrs. Bernard Barmann Bronze Baton Circle ($500-999) Mr. and Mrs. E.G. Berchtold Mr.'and Mrs. Bob Abrams John Brock Dr._Hubert Betenbaugh Phyllis Campbell Dn and Mrs. Homer Chaney Milan Carman Peggy and Curtis Darling Mr. and Mrs. John Carbin Dr. Marvin J. Derrick Central Printing & Graphics Genevieve Ernst Carol Davis Dr. T. A. Don Michael ,Mrs. Thomas Davis Mr. and Mrs. Lawrence Gallagher Dr. and Mrs. Jess Diamond Dr. and Mrs. Daniel Grabski Mr. and Mrs. John Dulcich . Mr. And Mrs. Charles Heppe Mr. and Mrs. Paul Eagleson Mr. Aqd Mrs. James Hitchcock Ms Hildegard Elges Dr. and Mrs. Sze Ho Dr. Myron Fisher Italian Heritage Foundation Dr. Harold Freedman Mr. and Mrs. Roderick Jameson Mr. and MrS. Howard Frick t2OOl-gO0g fRE DS Of SV Pl O V Mr. and Mrs. John Guerard A1 Naso Dr. and Mrs. Gall Haut Mr. and Mrs. Bob Neath Mr. and Mrs. Homer Hendrix Mr. and Mrs. Robert Nesbit Mr. and Mrs. Daniel Hering Dorothy Nobles Kent and Nicole Hillman Douglas and Brenda Oberholtzer Mr. and Mrs. Scot Hillman Mr. and Mrs. Robert Paul Lanatte Hodges Janet Poteete Jim Burke Ford Mr. and Mrs. James Radoumis Harold Kempen Mr. and Mrs. Frank Roraff Mr. and Mrs. Robert Kerr Leonard Sanoian Wendall and Elizabeth Kinney Mr. and Mrs. Jere Sullivan Mr. and Mrs. Leland Klein Vicki Thomas Dr. and Mrs. Thomas Larwood Mr. and Mrs. Jack Thomson Dr. and Mrs. Patrick Leung Mr. Everett Mann Helynn Manning MEMORIALS Mr. and Mrs. Richard Marine Memorials are gifts given to honor family and friends in a Mr. and Mrs. Warren Minner lasting and meaningful way. Brace Mooney Mr. Peter L. Newberg In memory of Millie Ablin Mr. and Mrs. Robert Newman Mr. and Mrs. Donald Barnes Mr. and Mrs. Thomas O'Connor Virginia C. Church Bob and Barbara Petker Mr. and Mrs. Roderick Jameson Leo Pierucci Dr. Tony Perelli-Minetti Mr. and Mrs. Harley Pinson Mr. and Mrs. Jere Sullivan Laura Porter Rose Reynolds In memory of Bernadette Betenbaugh Evelyn Rose Hubert S. Betenbaugh Phillip Ryall Sempra Energy In memory of Kathe Gillett Mr. Jean Schwynoch Mr. and Mrs. Jim Burke Dr. and Mrs. Robert Sheldon Virginia L. Folsom Robert Sherman Mr. and Mrs. Dan Hay Soutbem California Gas Company Mr. and Mrs. Bob Neath Dr. and Mrs. B. G. Stewart Mr. and Mrs. Christopher Stockton In memory of Sam and Dorothy Kelly Dr. and Mrs. F. R. Stone Mr. and Mrs. Gene Hambelton Dr. Marjorie Tavoularis Thomas Vetsch In memory of Shirley 1.~deke Earlene Waters Lynne Ludeke MacGregor Steven Ludeke Associate Member ($25-99) Jennifer Baird In honor of Eleanor Heiskell Louise Bond Kent and Nicole Hillman June Booth Patricia Brenner Mr. and Mrs. Earl Bmbaker Bertha Bmschi Mr. and Mrs. David Cothmn Mr. and Mrs. Robert Countryman ~ Betty Jean Dake B.M. Degree Mr. and Mrs. Martin Davis Baylor Univ. ~ ~ Mr. and Mrs. David Day, Jr. Piano Major~ ~ Dr. and Mrs. Phillip Dodson Mr. and Mrs. John Duffy Dan R. Martin ~ Mr. and/VLrs. Ronald Eaves ~ Mr. and Mrs. Robert Eddy Piano Technician ~ Virginia L. Folsom Golden Empire Concrete Alice Gordon Tuning, Regulating ~ Mr. and Mrs. Gene Hambelton t~ Repair Mn and Mrs. Leo Hinds Claude King "--1 Eloise Lambert Craftsman Member Ph. (805)393-2912 ~ Barbara Leask-Lingo Piano Technicians Call before 9 a.m. or after ? p.m. ~ Ethel Meyer Guild, L. A. Chapter Bakersfield, Ca. B41((RSR(LD SV PI OI'tV ORCH(STRk ,.JOHN ~'ARIREIR, MUSIC DIRECTOR Violin I Cello Bassoon Rebecca Brooks Diane Malecki - Principal Gerald Lanoue - Principal Concertmaster Karen Blocldey - Associate Principal Nicholas Price Jean Dodson Norma Sexton Associate Concemnaster Mary Eckart Lee Smith Charles Taggart Contra Bassoon Elizabeth Kinney Jeff Chert Steve Thiroux Donna Fraser Hairy Gilbert Tim Swanson Anita Gendler Jeremy Swanson Michael Mathews Horn Paul Cartwright Vladimir Zherdev Brian Smith - Principal Debbie Ellis Peggy Copp Jeff Corwin Lucy Adams Joe McKeehan Double Bass Eleanor Heiskell Patrick Morgan Lira Lehmer - Co-Principal Pete Scaffidi - Co-Principal Richard Francisco Tru m pet Violin II Vicki Thomas Charles Brady - Principal Amy Higgins - Principal John Hester Steve O'Connor Marcia Maynard Tim Farrell Michael C. nancy Norman Olsen Jason Torreano Brad Pickett Mary Mansfield Alex Navarro Elvira Lincoln Flute Trombone Randy Fok Nancy Ayala - Principal Doug Autrey - Principal Jeff Puette Jeanne Johnson Randy Fendrick Gayane Burnazian Audrey Boyle Gary Maxwell Pam Tompkins Oboe Tuba Viola Brett Clauses - Principal Glenn Bowles Paulette Shires - Principal Beatrice Barmann Stan Holcombe Madelaine Kaiser Percussion Elizabeth Swanson Clarinet Ernest Cervantes - Principal Helen Crosby Mary Moore - Principal Matt Bomong Mark Hatchard Marc Tipton Cyndi Duncan Charlotte Fender Amanda Posey Nora Adalian Louis Wildman Isabel Thiroux Eb Clarinet Leah Katz Patricia Jensen Harp Kathleen Moon Keyboard Liz Cervantes F /:ITUR D SOLOIST Axel Strauss In 1998, violinist Axel Strauss became the first German artist ever to win the ::::~!!iii!~. :~:!i Naumburg Violin Award, and in the iiiiii!i{?:ilseasons since, he has been equally !~:;i*~i.li i~ii acclaimed for his virtuosity and his musical sensitivity. The Salt Lake Tribune praised his well-rounded artistry by saying, "Strauss quickly established that he is a virtuoso to be reckoned with. But amid his i technical acumen, there was a genuine musician. His interpretive prowess was delightful." Mr. Strauss, who has been residing in the United States since 1996, maintains a busy performance schedule and serves as Professor of Violin at the San Francisco Conservatory of Music. ~_ He made his American debut at the Library of Congress in Washington DC and his New York debut at Alice Tully Hall in the fall of 1998, and continued a season with recitals in San Francisco, Las Vegas, Savannah, and West Palm Beach which culminated in a performance in New York's Central Park with the New York Chamber Symphony, conducted by Robert Mann. His other concerto appearances have included performances with the Grand Rapids, Santa Fe, Des Moines, North Carolina, and Jacksonville Symphony Orchestras, and the Naples Philharmonic. Highlights of the 2000-2001 season included recitals at New York's Alice Tully Hall, the Cleveland Museum, and the La Jolla Chamber Music Society, as well as a tour of Germany with the Hamburg Symphony Orchestra and performances with the Budapest Philharmonic in Hungary. Axel Strauss has been heard on concert stages throughout Europe since his recital debut in Hamburg in 1988 and his concerto debut with the Neubrandenburg Philharmonic two years later. He has also performed in China with the Shanghai Symphony and toured Japan with the Philharmonic Violins Berlin. In 1991 he won the silver medal at the Enescu Competition in Romania and has been recognized with many other awards, including top prizes in the Bach and Wieniawski competitions. Mr. Strauss studied at the Music Academies of Liibeck and Rostock With Petm Munteanu and with Dorothy DeLay at The Juilliard School. From 1998 to 2000, he served as teaching assistant of Miss Delay. He has also worked with such artists as Itzhak Perlman, Felix Galimir, and Ruggiero Ricci, and at the Marlboro Music Festival with Mitsuko Uchida, Andras Schiff, and Bruno Canino. His discography includes the violin version of the Sonatas Opus 120 by Brahms, the Duo for Violin and Cello by Zoltan Kodaly, a live recording of the Sibelius Violin Concerto, and a selection of Mendelssohn's "Songs Without Words," arranged for violin and piano. Axel Strauss performs on an outstanding violin by J.F. Pressenda, Turin 1845, on extended loan through the generous efforts of the Stradivari Society in Chicago. B41((RSF-I(LD SVMPH-OI'tV ORCH-(STRI dOHN F'AI~F~EER, MUSIC DIRECTOR Ooncert Preview with Dr. ,Jerome Kleinsasser The Grape Room - 6:30 p.m. Saturday, April 13, 2002 · 7:30 p.m. Bakersfield Convention Center John Farrer Conducting Axel Strauss Violin Soloist PROGRI IVl Overture to The Creatures of Prometheus, Opus 43 ....... Ludwig van Beethoven (1801) (1770-1827) The Lark Ascending ......................................................... Ralph Vaughan Williams (1920) (1872-1958) Axel Strauss, Soloist Tzigane ............................................................................ Maurice Ravel (1924) (1875-1937) Axel Strauss, Soloist INTERMISSION Symphony No. 5 in D minor, Opus 47 .............................Dmitri Shostakovich (1937) (1906-1975) Moderato Allegretto Largo Allegro con troppo This concert sponsored by Aera Energy LLC Alex Strauss's appearance is sponsored by George and Karen Johnson PROGRAm1 DIOT ES Overture to The Creatures of Prometheus, Op. 43 Ludwig van Beethoven (1770 - 1827) Other than his opera Fidelio, Beethoven's ballet on the Prometheus tale represents his most ambitious excursion into the composition of dramatic music. The 1801 production was first mounted in the Hofburgtheater in Vienna at the behest of Salvatore Vigan6, a composer and choreographer (and nephew of Lnigi Boccherini) who also danced the lead role. The importance of this music to B~thoven is indicated by the number of times he immediately re-cycled parts of its sixteen numbers in other compositions, notably the Opus 35 "Eroica" piano variations a year later, and the finale of the Symphony No. 3 in 1803. Ignoring the famous myth depicting the Titan who stole fire from Olympus and gave it to humankind, here the story centers about Prometheus, the creator of the human race. As in his first symphony, written at about the same time, Beethoven opens with a startling series of forceful chords that immediately leads us away from the C-major tonic key. An Adagio line featuring solo oboe follows, and an eventual return to the home key. The Allegro molto con brio first bristles with hushed strings, and then displays the typically aggressive orchestral language of Beethoven. Rising flutes and other woodwinds herald the sedond theme. At the conclusion of an abbreviated sonata form we are suddenly thrust into a transitional orchestral tempest which eventually gives way to a tentative return to the original C major and a lively rondo-like recurring theme. The Lark Ascending, Romance for Violin and Orchestra Ralph Vaughan Williams (1872 - 1958) He rises and begins to round, lie drops the silver chain of sound, Of many links without a break, In chirrup, whistle, slur and shake... For singing till his heaven fills, 'Tis love of earth that he instills, And ever winging up and up, Our valley is his golden cup And he the wine which overflows To lift us with him as he goes... Till lost on his aerial rings In light, and then the fancy sings. These tranquil words of George Meredith's poem "The Lark Ascending" were inscribed by Ralph Vaughan Williams on his original score in 1914, but it was not until 1920, when the horrors of the Great War were past, that his songful evocation for violin and orchestra was heard. It has sin~e become one of his most enduring and evocative concert works. The earth-bound ensemble provides resolute underpinning for the upward fluttering and swirling of the solo violin as it evokes the gracious songbird rising into the sunny skies of the English countryside. There it soars and rides the breezes, its bright song PROGRAm1 OTES filling the landscape so dear to this composer, until it ultimately vanishes in the distant azure skies. Its melodies are hewn from the modalities of British folksong that came to Vaughan Williams as easily as breath. Though derided by proponents of the edgier musical avant garde of his time, Vaughan Williams' art has survived his nay-sayers, and pieces such as The Lark Ascending continue to speak to audiences great and small, sophisticated and simple. Concert Rhapsody: Tzigane Maurice Ravel (1875 - 1937) In the winter of 1922 Maurice Ravel heard the extraordinary British violinist Jelly Aranyi perform one of his sonatas, and he was immediately captivated by her spirited playing. Aranyi's talents had already attracted the attention of Bela Bartok, who dedicated his two violin sonatas to her. She came by the gypsy style honestly, as she was the great-niece of the famous violinist, Joseph Joachim, himself of Hungarian extraction and associated with the works of Schumann and Brahms. After spending hours listening to Aranyi play melodies strongly flavored by her Hungarian ancestry, Ravel knew he had to compose something for this remarkable talent, and Tzigane was bom. He set about working two versions of the piece, one for violin and a piano with special timbres added such as the Hungarian hammer dulcimer - the cimbalom, and the other with orchestral accompaniment. The rhapsody was first heard in 1924. Tzigane opens with an extended, seemingly improvisatory cadenza for the soloist, a section brimming with nearly every violinistic pyrotechnic known at the time, but all emerging with the soul of Hungarian-style gypsy music. After working through these exhaustive variations with their exotic scales and nuances, upon the entrance of the ensemble the soloist settles into a quick, dance-like Csfirdfis that will ~undergo thematic development. These episodes carry us to the end with irresistibly seductive fre& passages for the soloist. Ravel's Tzigane represents one of the last evocations of a musical style that enchanted many composers for generations and continues to captivate audiences in the 21st century. Symphony No. 5, Op. 47 Dmitri Shostakovich (1906-1975) More than any other leading composer of the 20th century, Dmitri Shostakovich systematically explored and enriched the symphonic form. For decades he was the foremost composer among the first generation entirely trained and working in the Soviet Union. His path became clear when he found himself the chief symphonist in a country that had lost giants such as Rachmaninov and Stravinsky due to political strife.. Although his first three symphonies did not result in much Soviet approbation, in 1934 he created an international sensation with his opera Lady Macbeth of Minsk. It captured the imagination of Western musicians, but the puritanical Soviet censors let go with both barrels, describing the story and its music as akin to pornography. This resulted in an extended period of stem self-examination for Shostakovich, who publicly resolved to reform. He was too deeply committed to the Soviet view to question the PROGR I 'I"IOTES directives of his nation's rulers. An ensuing ballet also failed, and a fourth symphony was so reviled by officials that it was dumped before~it saw the light of performance. Redemption came on November 21, 1937, oddly .at the height of the "Great Terror," with the premiere of the Symphony No. 5. It was presented during a commemoration of the 20th anniversary of the 1917 revolution. The chastened composer claimed it was a "Soviet artist's practical creative reply to just criticism." The instantaneous enthusiasm of its public acceptance he found gratifying. Audience members, perhaps reading current tragedies into it, wept openly in the slow movement, and the applause at the end continued for a half hour. With the Olympian stature.Beethoven's symphonies h'S backdrop; Shostakovich'wrote: The theme of my symphony is the stabilization of a personality. In the center of this composition, which is conceived lyrically from beginning to end, I saw a man with all his experiences. The Finale resolves the tragically tense impUlses ' of ihe earlier movements into optimism and the joy of living. Thematically, the'opening bars of the symphony are key, as we hear two ideas: 1) a thut canon of opposing large intervals in the strings, which Soon gives waY to 2) a smoother line accompanied by' the' tense idea of the opening. The craggy opening line will return in various guises throughout the first movement. It is ~contrasted most notably by a cantabile violin melody in E-flat minoi: accompanied by pulsating string chords. These ideas grow and develop throughout the first movement and reach their climax in a great orchestra crescendo that evolves into a bizarre march. This in mm segues into an allegro statement of the Opening canon i~pon which is overlaid canonic brass statements of the cantabile tune in augmentation. Eventually the tension fuses into a giant octave statement in recitative style. When the stress subsides,' the Cantabile melody reappears, but this time beginning in a peaceful major key, where the flute is shadowed in the distance by french horn. The first movement ends introspectively, highlighted by muted solo violin, with echoes of the canon in the low strings and solo trumpet. The composer's reverence for the symphonic style of Gustav Mahler waswell known (one might claim he suffered from "Mahleria"), and this is nowhere more evident than in the spirit Of the Allegretto, a scherzo with two trios in the classic Viennese style. Further, the expressive depth of the symphony lies in the emotional Largo, as its very soulful melodies phase in and out of the strings and solo woodwinds. At the first performance in 1937 members of the audience openly wept duringthis movement. True to his Russian heritage, Shostakovich closes this symphony in the spirit of exuberance and heroism, beginnifig with a demonic march. It is laced with impulsive energy and an interlochng puzzle of motives that incorporates most of the orchestral families. Memories of previous movements are implied but not explicit. The affirmation of D-major near the end is in the grand tradition of symphonic writing that Originated with Beethoven. In attempting to create great music during times of political strife and .change, Shostakovich compared himself to B~ethoven: Only Beethoven was a forerunner'of the Revolutionary movement. I see our epoch as heroic, spirited, and joyous. Good music lifts and heartens people for work and effo~. It may be tragic but it must be strong. Copyright 2002 J. S. Kleinsasser ,4UDI HC TIQU TT A peaceful environment is necessary for the enjoyment of the sounds from our wonderful Bakersfield Symphony Orchestra. Simple rules of courtesy using common sense will vastly improve the serenity and happiness of the entire audience. The following guidelines will'make concert-going more enjoyable for all: · Arrive on time and stay until the concert is over. There will be no seating during the performance. · Avoid unnecessary .noise during the concert such as talking, paper shuffling, unwrapping candy, toe-tapping, humming, purse snapping, jangling jewelry and loud coughing. C-HH-8 · Reading program notes and skimming ads should be done before the concert or during intermission. · Applaud only after the end of the piece, not between movements. If you are uncertain, be the second one to applaud. · For the comfort of our patrons, food and beverages are allowed in the lobby only. · Cameras, paging devices and recording devices are forbidden inside the hall. Also make certain the elec. tronic signal on your watch is turned off during performances. WEDDING ~ SPEC~S~ / Pa~'~ents - F~ntains, Canop~s {~F~.PlaffO~:p~a~eBa~ ~ ~2,200 per pe~on ;~ T~s & Chaim · Li~ns * Se~i~ Equip~nt ~ China. Fla~am Gla~wa~ ;~ ;~ ~ ~quels & ~or . Disable P~uct /~i~lnviiat~,~nt ~ bpetker~cs.com e~ A~ M~h ~m~ ~ee the Old ~o~ld at a ~ GLOSSARY adagio .................. slow, leisurely maestro ................ master; conductor allegretto .............. moderately fast mezzo ................... half; (mezzo forte = half allegro .................. rapid; lively and brisk loud) molto .................... very much; (molto allegro = and~te ................. at a walking pace very fast) arpeggio ............... tones of chord played in succession movement ............independent section of a larger work brio, con ............... with fire opera .................... drama that is sung operetta ................ lighter dramatic musical with cadence ................ the closing of a phrase or spoken dialogue section of music cadenza ................ elaborate passage for solo opus ..................... a single work player overture ................ introductory movement coda ..................... tag added to the end of a movement pianissimo ............ very softly concertmaster ....... first violinist pizzicato ............... plucked with the finger concerto ............... a work for solo instrument prelude ................. musical introduction and orchestra crescendo ............. growing gradually louder quartet .................. group of four musicians quintet .................. group of five musicians dolce .................... sweet dolente ................. sad requiem ................ a Mass for the dead rondo .................... instrumental piece with encore .................. to recall to stage E-DD-9 recurring theme run ........................ rapid scale passage fanfare .................. call to attention by brass fantasia ................. subjective musical work scherzando ........... in a playful manner fervore, con .......... passionately scherzo ................. joke or jest - a composition forte .................. .~ loud with such a manner fortissimo ............. very loud solo ...................... alone; composition for one voice or instrument fugue .................... imitation within parts sonata ................... composition in 3 or 4 movements of contrasting grandioso ............. with grandeur sound staccato ................ disconnected notes harmony ............... musical combination of tones suite ..................... a collection of short instrumental pieces intermezzo ........... incidental music interval ................. distance between two tones tempo ................... pace of the composition key series of tones forming a trill ....................... two quickly alternating tones scale trio ....................... group of three musicians larghetto ............... a more rapid tempo than largo upbeat .................. the last beat of a measure largo ..................... slow and stately vivace .................. lively, faster than allegro leggiero ................ lightly We invite our season ticket holders to enjoy a complete evening of dining and entertainment. Join our participating restaurants for dinner before the concert!! Discounts are available on the following concert evenings: Oct. 4, 2001; Nov. 15, 2001; Feb. 9, 2002; March 9, 2002; April 13, 2002 and May 11, 2002. Participating restaurants are: Carrows Restaurants, all Bakersfield locations; Tapas Mexican Restaurant, 1800 Chester Avenue; Q Street Bistro, 801 Truxtun Avenue. For more information call events co- ordinator LeonorLi Gibbs at 323-7928. S¥1 PH-OPI¥ KIDS The Symphony Orchestra is pleased to continue our creative new child care program for the fifth year. While you enjoy the concert, your child - age 10 and under - will be developing an apprecihtion for the music as one of our Symphony Kids. Four age groups are kept busy with age appropriate activities: . ,: ~. infant to one year, two to three years, four to ':::'Bhkersfield's Publication six years, and seven to ten years. ~ :~. :~';.iS°Urce Since 1948 Community Connection for Child Care - staffs this fun and educational program on- - Product Catalogs - site at the Bakersfield Convention Center. Activities include constructing simple - Program Booklets - musical instruments, playing with harmony, - Newsletters- exploring rhythms, and talking with guest artists who share their knowledge and love of Full Color - Full Service music with children. - Digital Output - Symphony Kids is free to all Symphony IBM/Mac Formats subscribers. Cost for non-subscribers is only $5.00 for the first child and $2.00 for each NOW OFFERING NEWSPRINT! additional child in the same family. Space is limited and registration is on a concert-by- (661)323-9936 concert basis, first come, first served. To register your child as a Symphony Kid at the Vax (661) 323-8426 next subscription concert, call Julie Rubin at 861-5287 at least one day in advance. 1 801 1 6th Street Symphony Kids is sponsored by a grant from Bakersfield, CA 93301 the Blanche and Henrietta Weill Foundation. Consider a Gift to the Endowment Foundation Gifts:t0>t~e~ Bakersfield Symphony Orchestra Endowment Foundation strengthen the fiiian6ial foun~dation-that provides long-term stability and security. Endowment Foufidation:{nc6~d'"supi~brts the orchestra, its concerts, music education and ouffeach ~r6~rhms. It als9 furthers the development of the musical arts in Kern i! Gifts of,,anYi,amgunt to tffe Fgundation may be unrestricted or applied to specific p~oje6, ts. '".". ; '" Mak[ ,nga DOf~i~i~d .Gif~ to the Endowment Foundation Building the Foundati'on?§ endowment ensures the orchestra's artistic excellence and ldngevity~..w~liqfito'(h,,e new millennium. Bequests and planned gifts from !"Friends ~f'the;symphony are the single greatest source of funding securing the ',, Qrchestra s fu/t~.e. '.,~'~,pcludl~g> the Bakersfield Symphony Orchestra Endowment Foundation in your estafd'"plafi~ allows you to play a permanent role in the future of the Bakersfield Symphony Orchestra. Please consider supporting the Orchestra's future through your estate plans and kindly let us know if you have already done so. For More Information To request more information about the Bakersfield Symphony Orchestra Endowment Foundation or to schedule a personal visit, please call Lee Clark, President, Bakersfield Symphony Orchestra, (661) 325-5884. Please contact me: Name Address City Mail to: Bakersfield Symphony Orchestra 1328 34th Street, Suite A Phone Bakersfield, CA 93301 COHC(RT PR(qI(WS Preconcert talks are held before each subscription concert, beginning at 6:30pm in the Grape Room at the Bakersfield Convention Center. Dr. Jerome Kleinsasser, professor of music at Califomia State University Bakersfield, shares his insight on the aftemoon's program, providing a deeper understanding of the composers and their works. The Concert Previews are free to all and a wonderful addition to your concert experience. SVIYIPffOI'tV ORCH-(STRI Proudly Salutes :~ Thanks for 42 Years ..... ....... ~oj~n tuaote~'--va':--'-''~ .e"'~-' to"~-~':vt . ' ~ ~ 4 l'tOT( 'FO OUR P4TRONS Have you ever wondered what enables us to print programs and offer you as much information on the Symphony as possible? It's our advertisers'- those folks that buy an ad in the Symphony programs. As such, we ask you to please support our advertisers whenever possible - because your support will encourage their continued support. It's that simple! And our thanks to all of you, advertisers and patrons alike, for helping to expand the quality and reach of the arts in Kern County by supporting our fine institution, the Bakersfield Symphony Orchestra. The Arts Council of Kem and the Bakersfield Symphony are partnering for the 4th year to present Master Classes for local high school and college students. The Master classes give the students a unique opportunity of personal experience with a professional musician in a classroom setting. The selected students perform individually and receive constructive, interactive comments by the guest instructor. For more information about the Master Class Program, call Kandis Peake at (661) 588-0910 or the Arts Council of Kem at (661) 324-9000. JOIl't TI-I-( COI'tDUCTOR'S CIRCL( A donation of $500 or more entitles you to membership in the Conductor's Circle. As a member of the Conductor's Circle, you are invited to attend a complimentary wine and cheese reception during intermission at each concert. You will also be invited to an Opening Night light buffet dinner, a Meet the Maestro reception in a private home and receive a special parking pass. All donations are tax deductible. For more information, call (661) 323-7928. Please add my name... ,a Maestro's Circle *10,000+ *[~ Platinum Baton Circle $5,000-9,999 Name *[-I Gold Baton Circle $2,500-4999 *v~ Silver Baton Circle $1,000-2,499 Address *[~ Bronze Baton Circle $500-999 vi Patron $250-499 ~'hone rqSupporting Member $100-249 $. Signed [qAssociate Member $25-99 All contributions axe tax deductible *Conductor's Circle Mail to: Conductor's Circle Bakersfield Symphony Orchestra 1328 34th Street, Suite A. Bakersfield, CA 93301 CORPORI T P IRT RS The Bakersfield Symphony Orchestra gratefully acknowledges the generous support of the individuals, foundations, corporations and businesses whose gifts have helped ensure the continuation of the Symphony's many outstanding programs. Aera Energy LLC · A. B. Dick/IPS · World Records · Arkelian Foundation Rain For Rent · San Joaquin Bank · The Bakersfield Californian Foundation Bakersfield College Foundation · Bakersfield East Rotary Club Patricia A. Brown Estate in Memory of Christina Brown Castle & Cooke ° The Chevron Companies ° Three-Way Chevrolet KMAP Radio · Tejon Ranch ° j. W. and Ida M. Jameson Foundation W. A. Thompson, Inc. · WestAmerica Bank Soroptimist International of Bakersfield ° Ravi Patel, MD Shell Oil company Foundation · Target Stores · Grimmway Enterprises Harry and Ethel West Foundation · Helen Hawk Windes Foundation Texaco, Inc. · Walter Mortensen Insurance · Union Bank of California For information about becoming a corporate partner, call the Bakersfield Symphony Orchestra, (661) 323-7928 Season Ticket Holder Dinner Discount Member loin us for dinner before the concer~ and receive a 20% discount 4771 Planz Road, 831-0971 1300 Easton Drive, 322-4644 2673 Mt. Vernon Ave., 872-3948 955 Oak Street, 322-8541 Enjoy a wonderful culinary experience at the STREET · the performance After the performance, bring in your ticket stub or program for a complimentary dessert. SELECT' For reservations call 323-1900, extension 1020 ,ORG/INIZ/:ITION 200 I -2OO2 SYMPHONY OFFICERS AND BOARD Of DIRECTORS President: Milt Younger, Esq. Vice President: Matthew Malerich, M.D. Secretary: Donald R. Lindsay Treasurer: John Sherman, O.D. Bradford A. Anderson, M.D. HONORARY LIFE NIEMBER Thomas Banks, D.V.M. C.A. (Bud) Lambourne Bernard Barmann Ernest Cervantes Ex OFFICIO ~/]EMBERS Lois Chancy Oneida Rodenburg, Masterworks Chorale C. L. Clark Duncan Lowe, Symphony Singers Kurt Finberg, M.D. Bruce Freeman Toni Gallardo Frank Ghezzi Eleanor Heiskell Jeanne Johnson J. Nile Kinney Jerome Kleinsasser, PhD Joe Macllvaine, PhD Kandis Peake Anthony Perelli-MinetXi, M.D. Larry E. Reider, EdD Sandra Serrano Hon. Jon Stuebbe Gene Tackett ADMINISTRATION SYMPHONY ASSOCIATES John Farter, Music Director OFFICERS 2000-200 I Helen Hess, Nancy Marvin, Cecile Wattenbarger, LeonorLi Gibbs, Office Staff Toni Gallardo, President O. Wesley Moore, Operations Manager Liz Kinney, First Vice President 1im Mueller, Recording Engineer Jetta Dearmont, Second Vice President Jerome Kleinsasser, Concert Previews Helynn Manning, Recording Secretary Kae Babcock, Corresponding Secretary ORCHESTRA OFFICERS Stella McMurtrey, Treasurer Jeanne Johnson, President Tim Swanson, Vice President Donna Fraser, Secretary/Treasurer Emie Cervantes, Board Representative /:I ILI/:IT D OP, G/::Ir'IIZ/::ITION$ BAKERSFIELD BAKERSFIELD MasteRWORKS CHORALE YOUTh SYMPHONY Oneida Rodenburg, President Tom Creswell, President Suzanne LeGrand, First Vice President Helen Hess, Vice President Barbara Mattick, Second Vice President Jeanne Hame, Secretary Cecile Wattenbarger, Secretary David Swisshelm, Treasurer Tony Rodenburg, Treasurer Vision. Yours and ours...for a brighter future. It's the kind of vision that formed Aero Energy, California's largest oil producer. And it's the kind of vision that brings Aero and the community together, working side by side to make a difference. From education to health and human services to the environment to the arts, we join you in the commitment to a brighter future. The next era in energy Aero Energy LLC · 10000 Ming Ave. P.O. Box 11164 * Bakersfield, CA 93389-1164 · 661-665-5000 A BAKERSFIELD TRADITION SERVING KERN COUNTY FOR 55 YEARS OURNE TRk IEL TWO OF OUR MANY GflEA T FEA TUflED CflUISESt HAWAIIAN CRUISE - FALL OF 2002! ALASKAN CRUISE*- INSIDE PASSAGE! 11 Nights: September 15 - 26, 2002 7 Nights: June 9- 16, 2002 A wonderful opportunity to see four of the Hawaiian Islands and See Alaska's unmatched natural beauty on our offered cruise on visit five pods ot call. The "Big Island", Kauai, Maul, and Oahu Royal Caribbean's Vision of the Seas. Sailing roundtrip from are ali very beautiful and romantic, but with a variety ot Vancouver, Canada, you will visit Skagway - the gateway to the highlights. This is your chance to visit and tour the islands and gold fields, Alaska's capital - Juneau, Ketchikan, and Misty bring back a lifetime of memories. From the volcanic Big island Fjords. A "not to be missed" highlight is cruising into Yakutat to the lush tropics of the Garden Island (Kauai) to the beaches of Bay with the awesome and massive Hubbard Glacie£ See Maul, Hawaii is gorgeous. From Waikiki to Pearl Harbor to America's last frontier on this featured cruise at these Iow group Diamond Head, Hawaii is famous. For a truly deluxe cruise rates that includes aidare from Los Angeles. Come by to pick up experience, join us on RCCEs Vision of the Seas. Fscoded by a Royal Caribbean brochure for alternative choices for visiting Judith, you will sail from Vancouver to the Hawaiian Islands and Alaska with Royal Caribbean. Consider a Cruise - Tour that fly back to the?est Coast from Honolulu, Hawaii. Our tow visits the interior of Alaska, or a fabulous Glacier Route Cruise. group rate includes airfare from Los-Angeles or San Francisco.You'll appreciate the many sailing dates and choices that "RCCL" Price includes airfare, pod fees, and taxes! has to offer. Price includes airfare, pod fees, and taxes! Inside Staterooms ........................ from only $1490 Inside Staterooms ........................ from only $1445 Outside Staterooms ....................... from only $1840 Outside Staterooms ...................... from only $!645 Balcony Staterooms ...................... from only $2240 per person based on double occupancy per person based on double occupancy Royal C bean 661-323-9031 Royal C bean Lambourne Travel Cruise Headquarters - 1230 17th Street, Bakersfield CST# 2003473-10 KERN ECONOMIC DEVELOPMENT CORPORATION A-C Electric Company Equilon Enterprises LLC Olson Farms A.G. Edwards Em'on Pacific Bell ACN Communications First American Title Palne Webber Adair Engineering, Inc. Floyd Stores Paramount Farming Aera Energy, LLC Four Points Hotel Paramount Farms, Inc. AES Pacific Frisbee Bicycles PDC Properties, Inc. American General Media Frito Lay Pacific Gas & Electric AmerlcanTransit Mix Company, Inc. Golden Empire Concrete PrideStaff Arvin, City of Golden Empire Concrete Products Prince Bonding & Insurance Associated Builders & Contractors, Inc. Golden EmpireTransit District Prudential AmericaWest ASH Associates Goodwill Industries QLIAD*IGnopf Bakersfield 2t9 Partners Granite Construction Company Rain For Rent Bakersfield Association of Realtors Greater Bakersfield Chamber of Commerce Ridgecrest Chamber of Commerce Bakersfield Californian Grubb & Ellis / ASH & Associates Ridgecrest, City of Bakersfield Cellular Guy Chaddock & Company Rio Bravo Realty Bakersfield Economic & Comm. Dev. Hall Ambulance Roberson Real Estate ~d E U Bakersfield Family Medical Center Harrison Marketing & Advertising S.C. Anderson · · O Bakersfield Memorial ttospltal Holiday Ford Lincoln-Mercury Safcty-Klecn Corp. Bakersfield, City of Holiday Inn Select Convention Center San Joaquin Bank Bank of America Image Source Shafter~ City of Bank of Stockdale International Flight Training Academy Sheraton Bakersfield PUSHED US Bank of the Sierra ITTC Land, LLC Sierra National Bank Barbich Longcrier Hooper & King Jack Davenport Sweeping Services, Inc. Southern California Gas Company BillWrightToyota Jim Burke Ford/Lincoln Southern California Edison Borton, Petrini &Conron, LLP Karpe Real Estate Center State Farm Insurance Companies Brock, John M. Ken Small Construction, Inc. State of Calif EDD BSK & Associates Kennedy/Jenks Consultants StewartTitle of California, Inc . . Calaveras Cement Company Kern Chevrolet Dealers Stockdale Insurance Agency "" '/- California City Economic Development Kern Council of Governments Taft, City of California Portland Cement Tehachapi, City of · . , Tejon Ranch Company CaliforniaTrade & Commerce ?, ~' ~ , , ./ ,, CaliforniaWater Service Company '.',', "~ Tel-Tee Secmqty 7 CalMat of Cent_cai California . Texaco, Inc. Carney's BusinessTechnology Center Thc Allen Group Castle & Cooke California, Inc. Kern County Broadcasters Assoc. The Daily Independent CB Richard Ellis Kern County Dept. of Human Services ThermoTrilogy GOOD REASON Central Pacific Mortgage Kern County Supintendent of Schools Thomason & Clark Builders CentralValley Business Forms KernTech Three-Way Chevrolet Company Chancellor Media Corporation KGET -TV 17 Time Warner Chevron H.S.A. Klassen Corporation T] Cross Engineers ChicagoTitle Company Krazan & Associates, Inc. Trinity Financial Clifford&Brown LeBeau, Thelen, Lampe, Mclntosh&Crcar TurmanConstructlon TO LOCATE IN Coastline Equipment Lortz Manufacturing Company Llniglobe Golden EmpireTravel Coldwell Banker Preferred Realtors Loyd's Aviation Services Union Bank of California Coleman Homes, Inc. M & S Security United States Cold Storage ColliersTingey International Magnum Enterprises, Inc. Llnlversity of La Verne Colombo Construction Co. Martin-Mclntosh Valley Plaza Shopping Center Communlty Connectlon McFarland, City of W.B. Christiansen, M.D., Inc. mE P~N COUNTY Contra Costa Electric Merrill Lynch Amstutz/McDermott W.W. Grainger, Inc. County of Kern Mesa Marln Raceway Wallace & Smith Cynthia Pollard Communications Michael Burger & Associates Wasco, City of Daniells, Phillips~Vaughan & Bock Mid State Development Corp Washington Mutual Company Delano, City of Midway-Sunset Cogeneration Co. Watson Realty Company DMI Mechanical Minter Field Airport District Wells Fargo Bank Doubletree Hotel Bakersfield Mojave Desert Bank WestAmerica Bank Drummond Medical Group National Cement Co. of California Western States Petroleum Assoc. Dynegy Power Corp NWC Community Federal Credit Hnion Westrust East Kern Airport District O'Leary's Office Products Westside Waste Management Elk Corporation Occidental Oil & Gas Corp. Wm Bolthouse Farms, Inc. WZI Inc. KERN ECONOMIC DEVELOPMENT CORPORATION KEFtI DC KI~RN ECONOMIC DEVELOPMENT CORPORATION Patrick J. Collins President/CEO 2700 M Street, Suite 200, RO. Box 1229 · Bakersfield, CA 93302 661.862.5150 · Direct 661.862.5161 ° Fax 661.862.5151 ToU Free 877.KERNEDC · ~:maih collinsp@kedc.com 'www. kedc.com M ajor companies ars finding fertile soil to grow suc- cessful distribution facilities in the center of California. Companies like IKEA, Tar- get and Sears have discov- ered that Kern County has all the ingredients for suc- cess: a strategic location within a four hour ddve of 35 million people with access to major north/south and east/west transportation routes; a quality workforce at a cost savings; and a wonderful community for their employees to live in. /~ Again, Kern County has what logistics companies need. Not only does Kern Strategic Location County have an available workforce for Because Kern County is strategically Io- relocating companies, it is also one oi cated at the population center of Califor- nia, companies that relocate here can "The available workforce and its serve Northern and Southern California strong work ethic is why Sears population centers as well as Reno, Las Logistic Services has expanded Vegasand Phoenix, overnight by truck, to well over a million square That's 90 percent of the world's fifth larg- feet.' est economy. Martin Estrada Quality, Affordable Sears Logistics Services Workforce the most affordable labor forces in thr Target has also discovered Kern County. country. According to national labor sta! They are building a 1.7 million square tistics from the U.S. Department of La- foot facility at the International Trade and bor and Kern County Employer's Train- Transportation Center in Shafter that will lng Resource, doing business in Kern employee approximately 1,500 people. Countywill save businesses an averageI "You buy land once, but you pay your of $3.46 per hour in labor costs comparedI workers every Fdday. Perfect logistics with the national average."The availabl~.1 don't work if you can't staff your opera- workforce and its strong work ethic is wh~ tion,' says Jim Snodgrass, Senior Con- Sears Logist c Serv ces has expanded sultant with theWadley-Donovan Group. to well over a million square feet" says , Martin Estrada, facility training manager size since relocating from Los Angeles. for Sears Logistics Services. SLS is cur- Recreational opportunities in Kern rently preparing for their second expan- sion to nearly three million square feet, County range from the symphony and art museums to white water rafting, doubling their current size. NASCAR racing and professional Satisfied Employees Abundant cultural and recreational op- "Bakersfield is a small version portunities, twenty-minuteaveragecom- of a big city with friendly mute times plus the most affordable people, great housing and housing in California provide your em- greatschools~we'rehappyto ployees with an affordable and attractive be here.' place to call home and your company Howard Harris with a stable workforce. When master Guy Chaddock & Co. furniture maker Guy Chaddock & Com- pany was asked why why the company relocated to Kern County, the reasonwas hockey. And, since the metropolitan Bakersfield area leads California in al- clear. "Bakersfield is a small version of a big city with friendly people, great hous- fordable homes, sixty-eight pement of the lng and great schools--we're happy to homes are affordable to median income be here," said Howard Harris, Director residents, according to the National As- of Marketing for Guy Chaddock & Co. sociation of Home Builders. The Iow cost Guy Chaddock recently expanded their of living and quality of life in Kern County Bakersfield facility nearly doubling their will create satisfied employees, so you'll not only have excitement in the break reom but the boardroom as well. A Great Opportunity Logistics companies are thriving in Kern County and yours can too. Put down roots in Kern County and watch your bottom line grow. Call Jesse Mach to find out what Sears, Target and IKEA have already di{covered. KE'RI DC KERN ECONOMIC DEVELOPMENT CORPORATION 877-KERNEDC * 877-537-6332 www. kedc.com KER, NEDC KERN ECONOMIC DEVELOPMENT CORPORATION 2700 M Street, Suite 200, P.O. Box 1229 · Bakersfield, CA 93302 Manufacturing are finding companies fer- tile soil to grow successful companies in the center of California. Companies like Harvel Piss- tics, Step2 Manufacturing and Salter Labs have dis- covered that Kem County has all the ingredients for success: a strategic location within a four hour drive of 35 million people with access to major north/ south and east/west transportation routes; a qual- ity workforce at a cost savings; and a wonderful com- munity for their employees to live in. Strategic Location Located one and a half hours north of downtown Los Angeles and four hours south of San Francisco, Kern County is strategically located within a one day drive of 35 million people. Two major highways create the gateway to reach that population: Inter- state 5, the main north/south transportation corri- dor in the state; and Highway 58, one of the few east/west corridors in California providing year round access and a connection to Interstate 40. Quality, Affordable Workforce - ,-~T~~(;',-T'~,C'~,~,-,.;,.,U,,Ly ~ovi,~o, ti~ ~,v~..',,~,aUi~ aii~ ' L;allTG, fiia provlae y0~-i:employees with 'an aff0r:dable ana at- ~:. affordable labor forces in the country: The unemployment ra~e tractive place to call home and your company with a stable for the County currently stands at 12.8 percent, not seasonally workforce. adjusted. According to national labor statistics compiled by the Department of Human Services and Kern County Employers' Recreational opportunities in Kern County range from the sym- Training Resource, doing business in Kern County will save phony and art museums to white water rafting, NASCAR racing your business an average of $3.60 per hour in labor costs com- and professional hockey. And, since the metropolitan Bakers- pared with the national average, field area leads California in affordable homes, sixty-eight per- cent of the homes are affordable to median income residents, pi. according to the National Association of Home Builders. The Satisfied Em oyees iow cost of living and quality of life in Kern County will create Abundant cultural and recreational opportunities, twenty-minute satisfied employees, so you'll not only have excitement in the average commute times plus the most affordable housing in break room but the boardroom as well. A Great Opportunity Manufacturing companies are thriving in Kern County and yours can too. Put down roots in Kern County and watch your bottom line g?ow. Call Carol Parks to find out what Kern County manu- facturers have already discovered. KER DC KERN ECONOMIC DEVELOPMENT CO~RPORATION · 877-KERNEDC · 877-537-6332 :i~ www. kedc.com I~l~fl~E~J~OMi~:~ t~EVELOPMENT CORP0~ATION 2~0,MStmet, Suite 200 P.O~ Box 1:229 BakerSfield, CA 93302 KERN ECONOMIC DEVELOPMENT CORPORATION Daisytek Selects Tejon Industrial Complex for Distribution Center Kern County continues to be "hot bed" for Western United States distribution centers Daisytek, a leading wholesale distributor significant, for today and for the future. In company, Daisytek's presence will add an of c'omputer and office supplies and addition, it was important to access a estimated $55 million of cumulative impact professional tape products, has selected the high-quality labor pool to quickly set overthe nextfive yearstothe local economy. Upon completion of the project, Daisytek will distribute products for the world's leading brand names in technology and office products including Cannon, Hewlett Packard, IBM, Sony, Xerox, Avery, Fellowes, Lexmark and Smead from the facility. [] Tejon Industrial Complex At-a-Glance · Encompasses nearly 5 rriillio~ square feet on 350 acres in Phase I. · Will produce an estimated $5.5 million in annual sales tax revenue for Kern County. · Will create 5,000 new primqry arid secondary jobs. · Will generate an estimated $848 million ~n cumulative economic impact for the region over the next five years. Tejon Industrial Complex (TIC) to anchor up operations." its western United States supply chain. The Daisytek is in the process of hiring $ I .2 billion company will occupy half ofthe employees from the local area to run the 650,909-square-foot building located just facility and is the latest in a line of companies south of Bakersfield at the jun.etlon of that has determined that Kern County is a Interstate 5 and Highway 99 that is being great location for business. IKEA, Target and Message From de~/eloped by DP Partners and Tejon Sears haveall selected Kern Countyfortheir The President .................. 2 Industrial Corporation. West Coast regional distribution centers in .,.~ '" ,: ,' Primarily using FedEx Ground recent years. Each of these facilities is in transportation for next day business service excess of one-million square feet. Legisl,,ti,on' ~,,,.cts to all of California and beyond, this Ic~cation "In just three short years, we've been able Development is key to the company's new logistics model to build out 165 of the 350 acres atTIC, Incentiyes .............. ~ ........... 2 to distribute more than 20,000 products creating nearly 500 onsite jobs and ' -. ' from more than 250 manufacturers, substantially contributing to the regiona:l Kern EDC Board "Through an in-depth search for economy," says Robert Stine, president and Sees Change potential locations, we determined that the CEO of Tejon Ranch Company. "This is in Leade,rsb. ip ...~,~..~ ..........3 TIC best served our needs for our West how we are unlocking the value in our land Coast logistics strategy," says George Iylaney, to benefit the local ecor~omy and our Junior AchTevement senior vice president of operations for shareholders," adds Stine. · Daisytek. "The efficiencies we achieve in According 'toAI Gobar of Gobar and our supply chain by locating at TIC are Associates, an economic forecasting KERN EDC CONNECTIONS JUNE 2002 KERN ECONOMIC DEVELOPMENT CORPORAT ON · , A Message From the President · Kern Co u nty Some of you have probably noticed that and recruitment activities on a statewide basis. businesses, along worker's compensation insurance premiums On a local basis, we expectthat Kern EDC will with fellow busi- are on the rise. Many of you may recall the feelthe pinch in anumberofareas--specifically nesses up and down increases of a few years back, which made it in our contract with the Department of Human thestate, willsoon be very difficult for employers to offer health Services(DHS)thathad allowed ustoexpand facing a number of benefits to their employees. Businesses will our marketing efforts. legislative challenges, see rates that in some cases will double or As we face these challenges, we want you Some businesses even triple. These increases could force to know that your Kern EDC, CALED havealreadybegunto businesses to Iookoutside of Californiato do .. (California Association for Local Economic feel the pinch and business and will make it more di~cult to recnJit Development) and the California Central others will become new business to the State. You can begin looking Valley EDC, are working together to look PatrickJ. Collins more obvious over forincreasesinyourpremiumwhenyougoto for alternatives that will allow California President and CEO the next several renewyourexistingpolicies, businesses to continue offering health Kern EDC months. In addition, theStatebudgetproblemisgoing benefits to their employees. To help offset First off, I'd like to give you a heads up on to impactawidevarietyofservices, including the shortfalls from the loss of the DHS SB975, which virtually eliminates economic economic development from the State contract, Kern EDC is talking with City and development incentives in areas needing Department of Technology Trade and County officials and Iooking at an initiative to themmost. You'll find more details on this Commerce to your local Economic expand private investment so that we can legislation and how itwill impact local busi- Development Corporation. We are anticipating maintain our recruitment and retention ness on this page. cuts in the budget that will hamper marketing efforts. I~' New Legislation Effects Economic Development Incentives A new law designed to increase construc- receiving economic incentives from public en- Guy Greenlee, interim director of Kern tion pay has essentially removed the titles. As part of their economic development County's community development program effectiveness of incentives government entities plans, many cities and counties pay qualified department, believes that the law, as written once provided to attract businesses to their businesses a financial incentive to locate in a prior to SB 975, was right to require that pre- area. Over the long term, the law may instead particular area. Incentives may be based on vari- vailing wages be paid on public projects funded end up sacrificing employment opportunities in ous factors, by government entities. However, he believes the construction industry. Kern County's incentive program uses that the new law, because it affects private SB975, which was signed into law last Oc- projected sales, use, and property taxes the projects so dramatically, may provide a disin- tober and went into effect January I of this company will bring into the-County, over a centiveto businesses considering California for year, amends the California government and specified period, as the basis for its incentives, location ora new or expanded facility. labor codes and broadensthedeflnitionof"pub- Now, however, the estimated increase in "California isn't alyvays known for being the licworks"projectsbyredefiningwhatconstitutes construction costs required by SB 975 for most 'business friendly' state," says Greenlee. payment with "public funds." projects that receive any public funds will make "This law drives up the very first costs a company The law now requires that prevailing wages ' these incentives less attractive to prospective must pay, before they even open for business be paid on almost all private industrial projects businesses, c~,~i,~! ~ ~,~ .~...,, Kern EDC Welcomes New Investors ~n i~¥~5~m~ in ~m FDC i~ ~ Creative Concepts Cai State Steel Tom Saba Mike Hill investment in your company and your (661) ]26-0393 (661) 589-0972 community. A warm welcome to our Specializing in safety incentive programs and promotional items Specializing in c0ncrete-reinfordng steel newest K~rn t~DC JnvestoFs: Saba Agency Paramount Citrus' Jan Hefner David Krause Golden Empire Transit District (661) 326-0393 (661) 720-2401 Chester M01and Specializing in print and electronic media and web and graphic Specializing in citrus (661) 324-9874 · design Specializing in public transportation Praxair Volt Services Group Joe euiroz Oean L. Oavis, M.O., Inc. Sherry Craig (661) 201-5012 (661) 395-0135 Specializing in gases, welding supplies and cutting to01s Dean L Davis, (661) 632-5700 · . Specializing in technical, clerical and industrial placements %pecia~izing in radiatio~ ontology , III IlllID II · ~ ~ ........... ~,,. i i,i ii II I KERN EDC CONNECTIONS ~LJI~IE 2002 Kern EDC Board of Directors Sees Change in Leadership Kern EDC is saying "good-bye and thank County are integral to the success of Kern EDC Ensuring that continued growth is one of his you" to retiring board members and welcoming and it's especially important that the board keep strategic objectives. several new board members who will bring elected officials involved. "When the tide comes in, all boats rise." ~ continued growth and leadership to the Drew is especially pleased with the makeup organization, of the new board adding that it retains the large Board Members Bring Brent Dezembe~; chairman of the board and footprint of geographical, business and gov- Diverse Business Experiences president of Structure Cast, is stepping down ernment diversity that is necessary to help the Keith Brice after nearlyten years of leadership. Board Sec- entire County continue to grow. Incoming Mid State Development Corporation retary Susan Hood, a vice president at State board members are Keith Brite, president, Mid *Joe Drew, Chairman Farm Insurance; Harvey May, president, cen- State Developement Corporation; Ron Ray, Tejon Ranch Company Russ Eddington tral valley division, The Allen Group; Joe Co- president, Coleman Homes; Bill Sampson, vice Small Cities Representatrve, Iombo, vice president real es- City of California City president of Co- tare, Castle & *Dave Edwards, Secretary Iombo Con- Cooke; Tom Guy Chaddock & Company Tom Fallgatter struction; and FallAatter, attorney, Klein, DeNatale, Goldner, Cooper, Rosenlieb Bruce Freeman, Klein Denatale and Kimball, LLP president, Castle Goldner Cooper *Leslie Golich, Vice Chairman & Cooke are Rosenlieb and Kaiser Permanente also retiring from Kimball, LLP; Mary Grider the board. Andre Radandt, Wells Fargo Bank In looking back president, Wm. *Mayor Har~e¥ Hall City of Bakersfield on their tenure Bolthouse Farms, Bob Hampton with the board, Inc.; and Russ Westside Waste Management Co., Inc. Dezember says Eddington, small *Bruce Jay, Treasurer that among the cities representa- Bank of Stockdale Curl: Jones highlights is the board's decision to bring Patrick tive, City of California City. AT & · WireLess Collins on as the CEO. "We have a new slate of executive commit- SuperYisor Ion McQuiston "He has focused on'the industry cluster tee members and each of them brings such Countyof Kern groups which has allowed us to compete with experience and talent to our challenges," says Mark I*loore Commonwealth Financial Network other communities," says Dezember of Drew. "They have all made the commitment Paul Neuteld Collins' efforts. "In the past, we had a shotgun to go above and beyond and give extratimeto Small Cities Representative, City of Wasco approach to recruiting businesses, but it's been Kern EDC to give direction and set policy." Bob Ortiz Central Valley Business Forms evident with our growth over the last 18 Asthe organization looks tothe future, Drew *Supervisor Steve Perez months that our focused approach is working, says the private sector will be both a primary County of Kern He has broken the mold of the old Kern EDC," beneficiary and key to continued success of the Andre Radandt says Dezember. organization. Wm. Bolthouse Farms, Inc. Ron Ray Joe Drew, incoming chairman, commends "We need to continue to enhance our pri- Coleman Homes the board for its fiscal guidance and leadership, vate investment in Kern EDC," says Drew. Bill Sampson "We needed to look at the budget and our "When 1,000 jobs come into our commu- Castle & Cooke revenue stream and adjust the company to its nity, we see an increase in economic activity lef~ E. Shellebarger m~ ChevronTexaco fiscal reality," says Drew. "The board and the across all aspects of our business community," lo~n Wells executive committee were very instrumental says Drew. The Bakersfield Californian in providing guidance to the staff'to get that "Kern EDC is the only organization that can Barry Zoeller 07 accomplished." objectively represent all relocation options that Kern County Board of Trade 0~ In moving forward, Drew says cities and the exist in the community," he adds. * Denotes Executive Committee ~,~ rn ...~'o~fi~,~l./~-~ p~,~ 2 cases, outweigh any incentive cities and coun- panies locate to California. We certainly under- and have a chanceto begin making money." ties could provide." stand the concerns of labor, but given the Patrick Collins, president of Kern EDC, is Collins and'Greenlee both believe the new potential long-term impact, this doesn't seem m Z concerned that the law doesn't take into ac- law will make California less competitive with 'like the answer." -t count various market factors that impact states that don't have this disincentive. AccorctingtoCollins, the California Assoda- economic development. "In areaswith difficult "If it chases business away-from California, tion for Local Economic Development economic times, one of the few tools they we'll be sacrificing long-term employment and (CALED) is looking for the right answer and is 0 have for attracting business to their area has .the economic develoPment it would bring," currently working on proposed amendments been taken away," he says." The additional costs says Greenlee. "In addition, construction jobs to the legislation that could provide some relief associated with building a project will, in most may actually decrease over time as fewer com- to redevelopment areas. ~ Z KERN EDC CONNECTIONS JUNE 2.002 PRESORTED KER DC US POSTAGE PAID SHAFTER CA KERN ECONOMIC DEVELOPMENT CORPORATION PERMIT NO 66 P.O. BOX 1229 BAKERSFIELD, CA 93302 Junior Achievement Teaches About Business This year, Isaac Bryson, a fourth grader at tion needed to ultimately attain their goals," she KEPx E DC Almondale Elementary School in Bakersfield says. State Farm is also a Kern EDC investor. KERN ECONOMIC DEVELOPMENT CORPORATION learned about business in Bakersfield. 'A good Winnin[~ the battle over an uninformed, un- is something that can be seen or touched - like skilled workforce requires commitment, focus carrots or houses,'" says'Bryson. 'A service:is 'and passion qualities on which the Junior : K~rnEDC'isa~public/priv~tepartr~ship:dedi: cited to ensuring a-diverse and strong work done to help others - like opening a bank Achievement program is built, economic climate for all businesses in Kern account," he adds. "1 was impressed by the curriculum that Jun- Count7 Over II ,000 students like .Isaac will benefit ior Achievement uses," says Patrick Collins, from the lessons taught by Junior Achievement president and CEO of Kern EDC. "Finding a Kern EDC... this year thanks in large part to 6usinesses who quality workforce, with good work habits, is the · Recruits new businesses to, our area · Helps established businesses with are Kern EDC investors. Junior Achievement is greatest challenge facing the businesses we relocation and/or expansion Efforts a non-profit or§anizatioq that te~h~s.youth in workwith." Collins notes that while Kern County · Works with local companies to provide grades kindergarten through twelve. "We con- has an available workforce, that workfor~:e economic data, workforce development sider ourselves to be 'by business' and for needs to be prepared for work. "Not only does linkage and facilitation of the regulator), business' because our volunteers teach students the Junior Achievement curriculum introduce process what it takes to be successful in the workplace students to business and economics, it also and in life," says chairman of the Junior Achieve- teaches them about work ethics," adds Collins. mint board Boyd Binninger. Binninger works New supporters are needed this year to pro- Connections Es published quarterly bythe Kern for Grubb and Ellis/ASU and Associates, a Kern vide the program to even more schools. "There EDC for its investors and partners. News EDC investor. ' . . : are many schools requesting our program, items and stor7 ideas are welcome. Please CeCe Shanyfelt public affairs specialist at-State which .proves that Junior. Achievement is a good send ther~ to: : , . Farm Insurance, explains the .c0nne~ction. be- vehicle for workforce development. We need Connection~ tween student success ~nd Junio.r..A..c:hievement, ' r~ew companies ~nd in~li~iduals to get i'nvolved Kern EDC "Our associates are teaching the"~tudents con- if we are going to b~ able (o serve these schools," I?O. Box 1229 cepts of budgets, career decisibfi~ and ~.l~0w say~ Hea~the~' Hixo Phillips, 'pr~esident of Junior Bakersfield, CA 93302 their education relates to both.i' Man)~ children Achievement of KeFn County. www. kedc.com are lacking a comprehensive knowledge of eco- Fbr m~3re information on how to support Jun- ' (6'6 I) 862-5150 nomics. Thi-s hinders their alJility to focus on ior 'Achie'vem~nt, call (66 I ) 328-938 I or realistic career decisions and th~.level of educa- visit http:7/bakersfie.ld.ja.or§. [] KERN EDC CONNECTIONS JUNE 200:2 KeFri Economic Development Corporation 2.001-2002 Ann~n[ R~/~o~'t Joe A. Colombo Keith Brice Colombo Construction Co., Inc. Mid State Development Corporation *Brent Dezember, Chairman *Joe Drew, Chairman Structure Cast Tejon Ranch Company *Joe Drew, Vice Chairman Russ Eddington Tejon Ranch Company Small Cities Representative, City of California City Russ Eddington *Dave Edwards, Secretary Small Cities Representative, City of California City Guy Chaddock & Company Dave Edwards Tom Fallgatter Guy Chaddock & Company Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, LLP Bruce Freeman *Leslie Golich, M.S.A.-HCM,Vice Chairman Castle & Cooke California, Inc, Kaiser Permanente Leslie Golich, M.S.A.-HCM Mary Grider Kaiser Permanente Wells Fargo Bank *Mary Grider, Treasurer *Mayor Harvey Hall Wells Fargo Bank City of Bakersfield *Mayor Harvey Hall Bob Hampton City of Bakersfield Westside Waste Management Co., Inc. Bob Hampton *Bruce Jay, Treasurer Westside Waste Management Co,, Inc. Bank of Stockdale *Susan Hood, Secretary Curt Jones State Farm Insurance AT & T Wireless Bruce Jay Wayne Lepine Bank of Stockdale State Farm Insurance Curt Jones Supervisor Jon McQuiston AT &TWireless County of Kern Harvey May Mark Moore The Allen Group Commonwealth Financial Network Supervisor Jon McQuiston Paul Neufeld County of Kern Small Cities Representative, City of Wasco Mark Moore Bob Ortiz Commonwealth Financial Network Central Valley Business Forms Paul Neufeld *Supervisor Steve Perez Small Cities Representative, City of Wasco County of Kern Bob Ortiz Andre Radandt Central Valley Business Forms Wm. Bolthouse Farms, Inc. *Supervisor Steve Perez Ron Ray County of Kern Coleman Homes Jeff E. Shellebarger Bill Sampson ChevronTexaco Castle & Cooke California, Inc. John Wells Jeff E. Shellebarger The Bakersfield Californian ChevronTexaco Barry Zoeller John Wells Kern County Board of Trade The Bakersfield Californian g~rry Zoeller Kern County Board of Trade * Denotes Executive Committee Kern / · In the mid 1980's Kern County fell on mission is to "stimulate a diversified and hard times. The once booming oil industry strong economic climate in Kern County was facing the lowest point in its history,through recruitment of new business and agriculture,Western Kern County's opportunities and assistance in the other major industry, wasn't faring much retention and expansion of existing better. It was then that some visionary business." business leaders in the community recognized the need to diversify the Since it's formation, the Kern EDC has economy by bringing in other businesses also recognized the unique economic and industries. After all, relying on two needs and challenges of the communities major industries was putting all our in Eastern Kern County such as economic eggs in one basket. Those Ridgecrest, California City and Mojave, visionary leaders, including Ray Dezember, who depend largely on the aerospace James Burke,Jerry Stanners and John Brock, industry. Kern County has many diverse Sr., understood that to diversify the communities and it takes a strong economy would require; an organization commitment by individual cities as well dedicated to economic development; an as the county and a private nonprofit organization that brought to bear all the economic development corporation to community's resources both public and achieve economic success for all of our private; and an organization tha~ REVENUE Kern £1)V Sv~rves af Reven~e ~r £~ca/ )/e~r 2VVl- 2V02 Kern Ebfi Ex~cns~s ~r Fi~v~/ Ye~r 2OOl-2VV2 EXPENSES In the 2001- The current 2002 fiscal yea~ Dept. of Human Services Private Business Investment Salaries & Benefits ~rate~ of the the Kern 33% ~39% 76% Kern EDC is to Development~conomic ~~~>~ use business Corporation ~:~ developers to proa~vely was funded by market doing the City of ~ business in Professional Services Marketing Expenses Kern County Bakersfield, Small Cities Coun~ of Kern 2% Other General O~ce Expenses County of 6% City of Bakersfield 13% to targeted Kern, 12% I~ Depa~ment of 10% os industries, and Human ~ Private Business Investment ~ Small Cities ~ Salaries & Benefits ~ Other suppprt ex~ng Services, other ~ Coun~ of Kern ~ Dept. of Human Services ~ Marketing Expenses ~ Professional Services bus,ness.es in incorporated ~ City of Bakersfield ~ General O~ce Expenses those cities in Kern industries County and through the private business inve~ment from over indu~ry clu~er advisory groups. Kern EDC currently h~ dedicated 150 companies, business developers for the Iogi~ics, financial services and plastics and light manufa~uring indu~ries. This ~rate~ means the bulk of the organization's funding ~s ~ilized for ~affsa)ar~es and benefit. Business Recruilme l · ~espite the challenges wrought by the California industries. The business developers' activities include: energy crisis and the September I I terrorist cold calling; attending trade shows and other venues attacks, Kern [:DC was successful in supporting where site selectors and representatives of these the recruitment of 1,910 jobs, with a total estimated industries gather; and sending marketing materials to annual payroll of more than $36 million and targeted businesses. The result is companies both community investment of $ lB1 million, large and small have choosen Kern County. These recruitment successes are the result of hard work by For the past two years, Kern EDC's recruitment Kern EDC business developers and partnerships with strategy has been focused on using business cities, the County of Kern and the brokers and developers to proactively sell Kern County to key developers Kern EDC works closely with. 2001-2002 Location Announcements - Assisted by Kern EDC Company Jobs Location Investment Payroll Daisytek International 100 Tejon Industrial Complex $9,000,000 $2,300,000 Woodward at Stallion Springs 200 Tehachapi $7,500,000 Not Available American Carriage 40 Tehachapi $2,000,000 $700,000 Pactiv Corporation 400 Kern CountyAirport $80,000,000 $8,926,000 PNA Construction 20 Bakersfield $500,000 $200,000 Esparza Trucking 125 Bakersfield $ I,I 00,000 $550,000 JTS Construction 25 Bakersfield $500,000 $245,000 Target 1,000 Shafter $90,000,000 $23,612,800 Total 1,910 $180;600,000 $36,333,800 have apRr~p£i.ate, skil!S ~fqi'ithe~jg.b:This work with education institutions t~ l~i~ ~r~j~ ~e[~rI l 5. ~s I!1111111111~ Kern County Non-Farm Employment The Kern Economic Development Corporation measures it's success by tracking net non-farm job growth. The goal for the 2001-2002 year was a growth of three percent. The graph below shows the total number of iobs for every month from April 200 I to April 2002, and the percent change over that time period. I Year Percent Chan 2001-2002 202,500 Year 2000-2001 2.10% *Preliminary ( hat?mm4 Me, aoqe J ~--Iigh unemployment, economic uncertainty,improved financial and operational policy a volatile stock market, and lower prices forfoundation upon which to build achievement. many agricultural products. Sound familiar? It Patrick Collins and his team should be credited could have been the opening sentence of an with this success, as should the board of directors. article in the business section of The Bakersfield The chairman for the past two years has been Californian in any of the past seven decades. It Brent Dezember and he has been selfless in his just seems like the structural issues we deal with commitment to excellence at the Kern EDC.As in our society (and economy) don't change much. he leaves the board, we owe him a debt of thanks for his efforts. Other executive committee In spite of the persistence of the issues, wemembers that are stepping down include Susan Joe Drew continue to work toward solutions that "have Hood,Vice President of Operations for State 2002-2003 legs," that last. Clearly, one of the most lasting Farm and Kern EDC board secretary, and Mary Chairman of the Board is the creation of new jobs in any community. Grider, Vice President of Wells Fargo Bank and With a generous commitment to job creation, Kern EDC board treasurer. Both of these capable many communities have been able to keep the leaders and volunteers made important and pace of job growth up with population growth lasting contributions to our joint efforts. in spite of general economic malaise, even recession. We need that in Kern County. As I assume the duties of chairman, I am pleased to welcome new board members and investors. Here in Kern, we have been fortunate to have Keeping the organization connected to the an aggressive partner for overall economicbroadest possible community of interest is development and job creation, the Kern essential to our success, and to our economy. Economic Development Corporation.The Kern I pledge that, working with Pat Collins and his EDC today is a healthy and active partner with staff, we will remain focused on the basics, our cities, the County of Kern, and our private operate within our means, and share our sector in promoting the benefits of living and achievements. We will strengthen our working in our county. Kern EDC is more than communications with our investors, and we will an advocate for economic development; it is a work hard to increase the commitment of private credible contributor to the decision making and public investors so that we become process of countless companies consideringCalifornia's leading EDC. bringing their operations to the county. And for a growing number of reasons, the Kern EDC Our county is large and very diverse. The Kern must remain so. EDC partnership must reach and positively impact all communities in the county. Our mission ~ Over the past two years, the Kern EDC has and goals underscore our responsibilities for made remarkable advances. It is a leaner and doing that and our board and staff is committed more focused organization. It has more private to achieving that. We will keep our sleeves rolled sector investors than ever before (as a percent up and our eyes on the ball. of total revenues), and it has a significantly /nvastors · A-C Electric Company ICounty of Kern · Midway-Sunset Cogeneration Co. ADT Security Services, Inc. Creative Concepts Minter Field Airport District A.G. Edwards & Sons Creative Printing Mojave Desert Bank A & M Products Manufacturing Cynthia Pollard Communications, Motor City Auto Center Company Inc. NAI Capital Commercial Real Act I Technical and Professional Daniells, Phillips, Vaughan & Bock Estate Services, Inc. Aera Ener~ LLC David A. Turner Homes, Inc. NCR Commercial Brokerage Advance Beverage Company Dean L. Davis, M.D., Inc. National Cement Co. Allen Group, The Doubletree Hotel Bakersfield Olson Farms American General Media East Kern Airport District Ordiz-Melby Architects, Inc. American Transit Mix Company, Inc. El Paso Power Operations Pacific Gas and Electric Company Anonymous Donor Elk Corporation Paramount Citrus Arrival Communications Equilon Enterprises LLC Paramount Farming Company Associated Builders and Farmworkers Institute for Processes Unlimited Contractors Education and Leadership Project Design Consultants AT&T Wireless Development (FIELD) Quad Knopf, Inc. Automated Control and Technical Floyd's Stores, Inc. Rio Bravo Realty Services Frito-Lay Inc. Roberson Real Estate Automobile Club of Southern Gilliam and Sons Inc. SA Camp Companies California Golden Empire Concrete SBC Pacific Bell Bakersfield Association of Realtors Golden Empire Transit District S.C. Anderson, Inc. Bakersfield Californian, The Greater Bakersfield Chamber of SabaAgency Bakersfield Family Medical Center Commerce Safety-Kleen, Inc. Bakersfield Heart Hospital Grubb & Ellis/ASU & Associates San Joaquin Bank Bakersfield Spectrum LLC Guy Chaddock & Company Select Personnel Services Bank of Stockdale Hall Ambulance Serban Sound & Communications Bank of the Sierra Hall Commercial Vehicle Service, Soils Engineering, Inc. Barbich Longcrier Hooper & King Inc. Sonitrol of Bakersfield Baymarr Constructors, Inc. Hall Medical Equipment Supply, Inc. Southern California Gas Com Bill Wright Toyota HighSpeed Communications Southwest Ready Mix Concrete BMI Mechanical, Inc. Hillcrest Sheet Metal, Inc. State Farm Borton, Petrini & Conron, LLP Hyster Sales Company Stewart Title Branch Warehouse Corporation Indian Wells Valley Airport District Stockdale Property Management Brocl~ John M. iKnowTechnology, inc. Stinson's BSK & Associates Instant Electric Service, Inc. StructureCast Cai State Steel International Flight Training Superior Construction Calaveras Cement Company Academy Tejon Ranch Company California City J.Torres Company TeI-Tec Security Systems, Inc. California Portland Cement Co. JTS Construction Three Way Chevrolet California Water Service Company Jack Davenport Sweeping Services, Time Warner Cable Carney's Business Technology Inc. Time Warner Telecom Center Jackson and Perkins Operations, Turman Construction Castle & Cooke California, Inc. Inc. Uniglobe Golden Empire Travel CB Richard Ellis Jim Burke Ford Union Bank of California Central Valley Business Forms Kaiser Permanente United States Cold Storage ChevronTexaco Karpe Real Estate Center University of La Verne Chicago Title Company Kennedy/Jenks Consultants Valley Plaza Shopping Center Citizens Business Bank Kern County Broadcasters Volt Services Group City of Arvin Association Vulcan Materials Company City of Bakersfield Kern County Superintendent of W. Reyneveld Construction City of Delano Schools Wallace & Smith City of McFarland Kern-Tech Watson Realty Company City of Ridgecrest Klassen Corporation Wells Fargo Bank City of Shafter Klein, DeNatale, Goldner, Cooper, Westrust City of Taft Rosenlieb & Kimball, LLP Westside Waste Management Co., City of Tehachapi Krazan & Associates Inc. City of Wasco KSA Group Architects W.B. Christiansen, M.D., Inc. Coldwell Banker LeBeau-Thelen, LLP Occupational Medical Group Coleman Homes, Inc. Madland Toyota-Lift, Inc. Wm. Bolthouse Farms, Inc. Colliers Tingey International Mclntosh & Associates WZI Inc. Colombo Construction Co., Inc. M.D. Atkinson Company, Inc. Commonwealth Financial Network Mesa Marin Raceway ju~y ~.2002 Contra Costa Electric Michael Burger & Associates Mid State Development Corp. 6 61186 21515 0 * P.O. Box12 2 9 ' Bakersfield, CA 9 3 3 0 2 * wv~v.kedc.com KF:F I EDC KERN ECONOMIC DEVELOPMENT CORPORATION · /Cern ED , Team Patrick J. Collins Danielle McKinney President/CEO Investor Relations Darlene Fisher Peggy Meyers Business Developer- Administrative Manager Financial Services Carol Parks Beth Huggins Business Developer- Receptionist Plastics and Light Manufacturing Jesse Mach BrennaViskovic Business Developer- Logistics Workforce Liaison Bakersfield College California State University, Bakersfield Career Services Center Cerro Coso Community College [mployers' Training Resource Kern County Board of Trade Kern County Hispanic Chamber of Commerce laft College Weill Institute Small Business Development Center *Parmers are nonprofit organizations and public entities that work closely with the Kern [DC and support the organization in achieving its mission, but do not provide direct funding. Special thanks to Saba Agency for providing design services for this annual report, and to Iger Studios for the use of Kern County photos. KER I DC K£RN I:CONOMIC DEYELOPI~£N~ CORPORA]'ION 66 i/862-5 150 ' P.O. Box1229 · Bakersfield, CA 93302 · www. kedc.com KERINEDC KERN ECONOMIC DEVELOPMENT ~ORPORATION UPDATE July 11, 2002 BUSINESS RECRUITMENT ToUrs · Fixtures - Wholesale distribution. 50-75 acres, 500,000 sq. ft., 80-100 jobs. First contact 6/02. Status: Touring week of July 29, 2002. (jm*) Ongoing Projects · Archer - Distribution. 20,000-30,000 sq. ft., 20-25 jobs. First contact 5/02. Status: Short listed, Bakersfield, Visalia and Fresno. (jm*) · Hubb - Transportation. 20,000-30,000 sq. ft., 10 jobs. First contact 11/01. Status: Ongoing. (jm*) · Panel- Manufacturing of concrete panels. 10-20 acres, 25-50 jobs. Status: Toured on the 20th of March. Ongoing. (cp*) · Silo - Manufacturing. 30-40 acres, 40 jobs. First contact 4/02. Status: Ongoing. (cp*) · Sparky - Energy Producers (600-1000 mega watts). 100 acres, 250 jobs for first two years, 25- 30 jobs thereafter. First contact 9/01. Status: Short listing. Ongoing. (cp*) · Surfs Up - Distribution. 800,000 sq. ft., 500-1,000 jobs. First contact 4/02. Status: No recent contact. (jm*) · Tanker- Transportation. 5-50 acres, 15 jobs. First contact 5/02. Status: Narrowed down to two sites in Kern County. (jm*) · Storgro - Cold Storage. 100,000 sq. ft./20acres, 100 jobs. First contact 8/01. Status: Location down to two sites in Kern County. Sites approved by Storgro's Board of Directors. (cp*) · T- Customer Service Center. 50,000 sq. ft., 400 jobs. First contact 8/01. Status: Deciding on location. (df*) · X- Extreme Sports Camp. 200 jobs. Tehachapi. First contact 12/01. Status: Awaiting close of thirty day escrow period. (pjc*) Completed Projects · American Carriage - Expansion. 24,000 sq. ft., 20-40 jobs. Tehachapi. (pjc*) · Central Coast Mustang- Distribution for high performance Mustang parts. 10,000 sq. ft., 25 jobs. Tehachapi. (pjc*) · Daisytek International (AKA Tech Distribution) - Distributionl 326,000 sq. ft., 100 jobs. (jm*) · Denny's (AKA Denco) - Food Service. 70 jobs. Located in Delano. (pjc*) · Esparza Trucking (AKA EZ) - Trucking Company. 6-10 acres, 100-125 jobs. Located in Bakersfield. (jm*) · Fortune Group (AKA Discovery) - 45,000 sq. ft., 30+ jobs. Located in unincorporated area of Kern County. (pjc*) · JTS Construction - Modular Construction. 9 acres, 20-25 jobs. (cp*) · Matrix Glass - Manufacturing company. 83,000 sq. ft., 30-35 jobs. (pjc*)' · Mojave Airport Hotel - 32-36 jobs. (pjc*) · Pactiv (AKA Mix) - Warehouse/Distributor. 800,000-1.4 million sq. ft., 300+ jobs. (jm*) · California Packaging Materials (AKA Red) - Manufacturing. 15,000 sq. ft., 35 jobs. (cp*) · PNA Construction (AKA Steel) - 12,000-15,000 warehouse on one acre, 15-20 jobs. Located at 311 Mt. Vernon in Bakersfield. (cp*) · Target(AKA CB) - Distribution center. 1.7 million sq. ft., 120 acres, 1,000jobs. Located in International Trade and Transportation Center, Shafter. (jm*) Projects on Hold · America - Pipe manufacturing. 50,000-75,000 sq. ft., 55-75 jobs. First contact 11/00. Status: On hold until 9/02. (cp*) ·Cool- Refrigeration. 40,000 sq. ft./2.5-5 acres, 75-100 jobs. First contact 3/01. Status: On hold. (jm*) · Crow - Call Center. 100,000 sq. ft., 250 jobs. First contact 2~02. Status: On hold. Waiting for final decision on telecommunications infrastructure. (df*) ·Fizz- Chemical Manufacturer. 10,000 sq. ft., 12-15 jobs. First contact 9/01. Status: On hold. (cp*) · Heat/Cellini Consultant- Food Processing Plant. 80,000 sq. ft., approximately 75 jobs. Concerned with energy issues. Status: Still considering; not sure on timing and looking at the current economy. (pjc*) · Liu - Manufacturing. 30,000-50,000 sq. ft., 20-40 jobs. First Contact 1/02. Status: On hold because of Recycling Marketing Development Zone application funding deadline, (cp*) · Mega Distribution Trade and Commerce/Deloitte Touche - Distribution Center. 2 million sq. ft., 800-1,000 jobs. Status: On hold due to corporate reorganization. (pjc*) *Initials Key cp= Carol Parks, (661) 862-5058 df= Darlene Fisher, (661) 862-5056 jm= Jesse Mach, (661) 862-5059 pjc= Patrick J. Collins, (661) 862-5161 Kern EDC Performance Report June 2002 Daisytek International - Tech Distribution 100 Apr-02 Tejon Ranch Manufacturing $9,000,000.00 $2,300,000.00 Woodward at Stallion Springs - X 200 Mar-02 Tehachapi Sports Camp $7,500,000.00 TBD American Carriage 40 Jan-02 Tehachapi Manufacturing $2,000,000.00 $700,000.00 Pactiv Corporation - Mix 400 Dec-01 Unincorporated Kern Distribution $80,000,000.00 $200,000.00 PNA Construction - Steel 20 Oct-01 Unincorporated Kern Construction $500,000.00 $200,000.00 Esparza Trucking - EZ 125 Sep-01 Bakersfield Trucking Company $1,100,000.00 $550,000.00 JTS Construction 25 Sep-01 Bakersfield Manufacturing $500,000.00 $245,000.00 Target - CB 1,000 Sep-01 Shafter Distribution $90,000,000.00 $23,612,800.00 Denny's - Denco 70 Jun-01 Delano Food Service $1,200,000.00 $1,680,000.00 Matrix Glass 50 Jan-01 California City Manufacturing $6,000,000.00 $800,000.00 Fortune Group 30 Aug-00 Unincorporated Kern Manufacturing Lease $1,680,000.00 Matrix Motors 30 Jul-00 Ridgecrest Manufacturing $1,120,000.00 $720,000.00 IKEA 200 Apr-00 Tejon Ranch Distribution $50,000,000.00 $7,200,000.00 Auto Parts Wholesale 65 Mar-00 Unincorporated Kern Logistics $8,000,000.00 $1,560,000.00 Archer 20-25 May-02 Kern Distribution Silo 40 May-02 Kern Manufacturing Tanker 15 May-02 Kern Transportation Hubb 10 Kern Transportation Sparky 250 West Kern Energy Production Storgro 100 Bakersfield Warehouse/Dist. T 400 Bakersfield Call Center KERIX,EDC KERN ECONOMIC DEVELOPMENT CORPORATION 06/20/2002 Kern EDC Performance Report June 2002 Madland Toyota-Lift, Inc. Jun-02 Hyster Sales Company Jun-02 J. Torres Company, Inc. Jun-02 Cai State Steel May-02 Creative Concepts May-02 Paramount Citrus May-02 Praxair May-02 Saba ,~gency May-02 Volt Services Group May-02 Dean L. Davis, M.D., Inc. Mar-02 Golden Empire Transit Mar-02 Kern County Superintendent of Schools Mar-02 iKnowTechnology, inc. Mar-02 ADT Security Services, Inc. Feb-02 Citizens Business Bank Feb-02 Gilliam and Sons Inc. Feb-02 Hall Commercial Vehicle Service, Inc. Jan-02 Hall Medical Equipment Supply, Inc. Jan-02 Stewart Title Jan-02 Superior Construction Jan-02 M.D. Atkinson Co., Inc. Dec-01 HighSpeed of California Nov-01 Sonitrol of Bakersfield Nov-01 Stockdale Property Management, Inc. Nov-01 Master Development Corporation Sep-01 Act I Aug-01 Creative Printing Jul-01 Hillcrest Sheet Metal, Inc. Jul-01 Southwest Ready Mix Concrete Jul-01 Adecco, The Employment People Jun-01 Advance Beverage, Inc. Jun-01 Environmental & Safety Management Services Jun-01 Motor City Auto Center Jun-01 KERI EDC Kern EDC Performance Report June 2002 Proiect Matrix 100 Acres 30 May-02 No action Eve & Me 20,000sq. ft. 25-50 Mar-02 Client not returning calls Denco 5,000 sq. ft. 70 Jan-02 Zoning issue, sign reiected ~Tapp Development 50,000 sq. ft. N/A Oct-01 X 'Carol 50-70k sq. ft. 20-25 Aug-01 Company buy-out 'Zebra/Distribution 116 Acres 450-900 Jun-01 X !Boyd 8-10 Acres 5-10 Jun-01 X Reuse/RMDZ client 40 Acres 40 Jun-01 Client not returning calls ISuede 10-20 Acres 50-100 Jun-01 X Tire Recycler Project 102 Acres 36 May-01 X British Petroleum N/A 5-15 May-01i No more interest Unique Plastics 20,000 sq. ft 20 Apr-01i X Investment Company 18 Acres N/A Mar-01 Retail development in Rosamond Carrier/Coldwell Banker 26-27 Acres 80-110 Feb-01 Corporate buy-out Whitehouse Staubach/KPMG 80,000 sq. ft. 1000 Feb-011 Company split in two Rez-Tech 30,000 sq. ft. 30 now, 50 later Sep-00 X Straw 60,000 sq. ft. 75 now, 200 later Sep-00i X Bottle 56,000 sq. ft. 35 now, 75 later Jun-00 X KERI EDC KERN ECONOMIC DEVELOPMENT CORPORATION 06/20/2002 California Legislation Signed to Create "Do Not Call Lists" Prohibiting Telemarketing Federal Legislation Proposed In October 2001, Governor Gray tion; or sell or promote any investment, Davis signed into law Senate Bill 771 insurance orfinancial services. regulating unwanted telephone solicita- How does the list work? "Simply de- tions. The Bill, authored by California scribed, Senate Bill 771 would allow con- State Senator Liz Figueroa (D-Fremont), sumers the choice to have their name requires the State Attorney General to placed on a listJdatabase maintained by maintain a "do not call" list, containing the Attorney General. Any solicitor that the telephone numbers and zip codes of calls into California would be subject to residential orwireless telephone subscrib- this law, and the penalties created by it," ers who do not wish to receive unsolic- according to an article on SB 771 fea- ired and unwanted telephone calls from tured on Senator Figueroa's website telephone solicitors. Once a subscriber (http://democrats.sen.ca.gov/senator/ places themselves on the "do not call" figueroa/). Consumers can place their list, telephone solicitors would be prohib- name on the do not call list by contact- ited from calling subscribers on the list lng the attomey general's office and pay- to: sell, exchange, promote, gift or lease lng a fee not to exceed $1.00. The pay- any goods or services: offer or solicit ment ofthe feewould keep the individu- credit; seek certain marketing informa- als name on the list for a period of three LEGISLATION continued on page 2 Websites Offer Advice for Call Center Companies Call Center Management Review recently published a list compiled by freelance writer Mark Levin. The list contains the web address and a brief description of the information available on that site. A partial list of websites featured in this article are reprinted below. If you would like a copy of the entire article, contact Darlene Fisher at 661-862-5162. ACD Learning Center ( www. call-center, net): Features an expan- sive archive of call center articles on everything from ACD reporting to workforce management. Also provides a library/index of recent benchmarking studies, various call center "tutorials," and a call center "yellow pages"(a vast directory of products/ services, associations, industry events, etc.). Ask the Outsourcing Experts (www. outsourcing-experts.com): Features a virtual forum on outsourcing topics (in- cluding archives of past questions and responses). Also provides useful outsourcing frequently asked questions (FAQs) and definitions, as well as information on outsourcing suppliers, events and research. CRMXchange (www.crmxchange.com) The highlight of this site is its three virtual forums (general forum, "international room" and "sales management room"). There are also monthly interactive seminars on hot call center topics (though sometimes with too much of a vendor spin). All past virtual seminars are archived. Other resources include white papers and case studies, a calendar of industry events, job listings, and directory of call center suppliers. WEBSITES continued on page 2 KERI DC WEBSITES from page 1 The Call Center Directory Call Centre Managers Forum Callcentres.net (www.callcentres.net) (www.prefsolutions.com) (www. callcentres.com.au) Posts regularly updated call center re- Features an "exchange forum" for call Features a Virtual discussion forum forcall ports, news and white papers. Also pro- center professionals, aswell as industry center professionals, as well as articles vides a discussion forum, call center news (mostly related to vendors/new on a wide range of topics, including hir- FAQs and glossary. (Note: this site's pri- technology). Provides productJservice ing, training, monitodng/coaching, perfor- mary focus ison call centers in Australia listings for technology, consulting, staff- mance measurement, incentives and oth- and Asia Pacific region, though much of ing/human resources, outsourcing and ers. the material is useful for any call center seminars. The site's list of"call center CallCenterOps.com professional.) links" is one of the most comprehensive (www.callcenterops.com) Customer Care Institute on the Web. Features a wealth of current call center (www. customercare.com) Call Center eXchange news and articles (with a particular bent Provides a variety of call center/customer (www.callcenterexchange.com) towards e-commerce, CRM and the lat- service research tidbits and factoids from Posts feature articles on current topics est technology). Also provides a virtual a diverse range of industry sources. Also (including several on e-commerce and discussion forum, job listings and an ex- provides an online discussion forum for Web-basedcustomersupport).Sponsors tensive "links section" (which includes customer care professionals. a call center discussion forum. Additional many of the sites listed in this article). Customer Contact Strategy Forum resources include a"career center" and CallCenterWorld.com (www.ccstrategyforum.com) informative call center FAQs. (www.callcenterworld.com) CCSF is a community of senior execu- CallCenterGuide.com Contains well-written and timely feature tives that"sets the strategic direction for (www. callcenterguide.com) articles and industry news, as well as re- customer care across multiple channels The site serves as an online guide to a cent call center research and case stud- of the organization." While one must vast number of call center products and ies. Among its many other resources are "qualify" for membership (see site for de- services. No sales spin -- visitors can a discussion forum, an "Ask the Expert" tails), the Web site does contain a vari- simply use the site to obtain contact in- feature, call center FAQs, product reviews ety of good articles and highlights of re- formation for a variety of vendors, con- and a "jobs center." cent call center-related research. sultants and associations. LEGISLATION from page 1 years. Ifa telephone solicitor contacted a consumer whose name had been placed on the do not call list, the soliciting company could be liable for civil and criminal penalties according to Figueroa's website. There are a few exemptions to the law that allow for charity and political solicita- tions and allow small businesses with less than five employees to make such solici- tation calls if the principal of the business makes the call in their local area. SB 77'1 also contains an exemption to allow for debt collection, and calls made in response to the request ora consumer. Another State of California Bill passed in October 2001, AB 870 sponsored by Assembly member Herb Wesson (D-Los Angeles), prohibits telemarketers from using "predictive dialers" or automatic dialing. "This bill would prohibit, on and after July 1, 2002, any person operating specified automatic calling equipment from making a telephone connection for which r)o person, acting as an agent or telemarketer, is available for the person called..." according to the text of the bill in the Legislative Counsel's Digest. At the Federal level, a number of bills have been proposed regulating the telemarketing industry. The list includes: The Telemarketing Intrusive Practices Act of 2001 (S.1881..IS); the Telemarketing Victims Protection Act (H.R.232.1H); the Know Your Caller Act of 2001 (H.R.90.RFS); the Telemarketing Relief Act of 2002 (H.R.3911.1H); and the Telemarketing Identification Act of 2001 (S.722.1S). All of these bills have been referred to House subcommittees. To check on the'status of any of these bills, go to http://thomas.loc.gov and enter the number of the bill, or you can do a search on any key phrase to find all proposed legislation on a particular topic.