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HomeMy WebLinkAbout2006 PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date ~1~V~ ~; .i Z...~c~ (~ You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: ,t/~l ~i~V I kJ [~) ~_. i~ ~ Company/ Organization: ~' ~ ~ ~ ~ ~-/''~ ~ C ~ ~ ~ ~ ~- Address: J' ~ '~ O ~ Tv~-v '~.~ ~v ~-~ Phone: ~i- '~ ~ ' i~ FaCe-mail: ~1- ~ ~- ~ ~ PUBLIC STATEMENTS SPEAKER'S CARD Bud,qet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Company/ Organization: Address: Phone: ~,~---'~,) ti 0'"~'~) I~' Fax/e.mail("~7~;~.,~o.~OI "~:~'o~ .., Z -./ ', ~,.., ~,. j -- Subject: (....~,,~ PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker, The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: -~'~ [ ~ (~(:~ Company/ ---___.__ Organization: ~-~~-"'T~ iO I.~__~ t~ Address: '~"~'~ 0 C~ ~ ~,,),,.,,,~ Phone: ~ ,,~..-"7 ~ J j""~ ~ Fax/e-mail:T'Dl~, Subject: '~Jt ~-- ) Chuck Haas CEO & Co-Founder , 516 Clyde Avenue i.- . Mountain View. CA 94043 650.810.8000 Main 650.810.8012 Direct 650.810.8001 Fax chuck~metrofi.com BAKERSFIELD Alan Sandy · City Manager October 9, 2006 Ben Zifrony MetroFi 516 Clyde Ave Mountain View, CA 94043 Dear Mr. Zifrony: I would like to take this opportunity to invite you to the next meeting of the City of Bakersfield's Budget and Finance Committee to discuss your proposal to provide WiFi service in our city. The members of the Committee feel it is extremely important that a representative of your company be present in order for them to consider your proposal any. further. The meeting will be held on November 6, 2006. at 10:00 a.m. in the City Manager's Office at 1501 Truxtun Avenue, Second Floor. Additionally, a tentative date of December 13, 2006 has been .set for a Public Hearing to allow you to present your proposal for consideration to the entire City Council' and the public. This hearing would be held during our regular City Council Meeting at 6:30 p.m. in the City Council Chambers at 1501 Truxtun Avenue, 'First Floor.' Sincerely, ,John W. Stinson ^ssistant City Manaoer City of Bakersfield · City Manager's Office ° 1501 Truxtun Avenue Bakersfield, California · 93301 (661) 326-3751 · Fax (661). 324-1850 PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard ! Name: ~..~J~--~-.4/~.,x~-- ~..-~ ~ ~-/~,,,~ Company/ Organization:' Address: Phone: Subject: ~'~/ ~ ~/d &~ ~Y PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date /~©~ ~' You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Company/ Organization: Address: ~0 b ~ ~ '~' Subject: PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Oommittee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majodty vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Company/ Organization: Address: Phone: Subject: PUB,~c STATEME~iTS SPEAKER'S CARD Bud.qet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majodty vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor'Mike Maggard Name: Company/ Organization: Address: Phone: Subject: PUBLIC STATEMENTS SPEAKER'S CARD Bud,qet and Finance Committee of the City 'Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majodty vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to .the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: '_~'~ Company/ Organization: Address: Phone: Subject: ~C~$/~r$ 7"A X C~t~ 7'{~/¢/J 'T~ PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date /~' ~-' You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Company/ Phone: ~ Subject: · ~ ~] ~ ' 9/28~06 8:52 AM GREATER BAKE..: ~7-8~1 Co~e~*l ~ OK ~R451BBD3~ ",,:~ Trash' ~ ~ - 9/28/2006 8:52AM EDITOR- THE 8... 395-75~9 ~ ~ ~ ~28/2006~52~ N~SD~SK-C,.' 33~-26~ Cove~ ~OK ~R451BBO3~ ~1 ~ 9/28)2006 ~52AM OMN[ON PAGE -..;. ~5-~0 Cov~r+~ .e OK : ' ~R4518803E ~ 9)28/2~0G 8:52 ~M 801LD'ING IN~U ~33-i 317 Core'+1 .~ 0K ~R451BBD3E  9/2~06 8:52 A~ CHARLES WAID... 325-7814 9/2~20~8:52AM THE~INORI~._. ~3-~7 Cover+l ~OK ~R45188D3E 9/~20~ 8:52A~ ~ACSPANISF 327~797 ~er+l ~ OK ~R45188D3E ~ 9/28/~06 8:52 AM K~I TV-45 KUZ ~-7537 ~o~r+3 ~ OK ~R451BBD3E ~ 9/28/~06 8:52A~ KLLY95~N-KNZ... 393-1915 ~ver~l ~ OK ~R451BBD3E '~ ~28~006 8:52 AM K~ NEWS RO 2~-2~3 Cover+l '~ OK ~453BBD3E ~ 9/28/~06 8:52AM KGET TV-17 NE ~3-1843 Cover+~ ~ OK ~R45188D3E '~ 9/28/2006 8:52 ~ KERO TV-23 NE 3Z3-5538 Co,r+1 ~ OK ~R451BBD3E ~ 9/28/200G E52~ KERN-KGEO-KG 3~-0~8 ~ver+3 '~ OK ~R45188D3E ~ 9~/20068.52A~ KB~TV-29NE... ~1-9810 Cwe[+l ~OK ~R45188D~E ~; 9/~/20~8:52~ EDITOR;ELPO. 3~-1351 Cover+l ~ OK ~R451BBD3E T ~ 9/~/20068:52A~ ELMEXI~NO ' 323-6951 C6ver*l ~ OK ~R45188D3E ~ 9~8~0068:52A~ KENDALL~ARS... 2~-2963 Cover+3 ~ OK ~R451B~3E :~ ~ 9/28/2006 8:52A~ DAV{D 8URGER. 395-7519 ~ver+l O OK ~R45188D3E --~ 9/28/20068:52A~ EDITOR-THE B,. 324-9472 Cover+l ~ OK ~R4518803E ~ ~28/~G 8:52 AM BEALE MEMORI 631-9499 Cover+~ ~ OK ~R45188D3E ~ ~28/~068:52A~ GOVERNMENt. 635-2317 Cove[+1 ~ OK ~R45188D3E  9~28~a06 52AM ~THYEDDY-~868-3190 ~o~er+l ~ OK ~R45188D3E ~R4500473G~ ~R4500473G~' ~R4500473G: ~R45004736' ~R450047~, ~R4~0473G' ~R45004736~ ~R45004736~' ~45004736; ~R4500473~ ~ ~ ~P LASERJET 3150 ~ ]~RZNTER/FAX/COPIER/SCANNER CzTySEND oFCONFZRMATZONBAKERSFZELDREPORT FOR '~ ¥[~ 3241850 I SEP-28-06 3:10PM JOB START TIME USAGE PHONE NUMBER/ADDRESS TYPE PAGES MODE STATUS 784 9/28 3:06PMI 0'00" 6352317..i ....................... SEND .............. 0 REMOTE FAX'WAS BUSY ............ 961 784 9/28 3:09PM 0'42" 661-635-2317 SEND .... 2/ 2 ~i'~ COMPLETED ........................................ TOTAL 0'42" PAGES SENT: 2 PAGES PRINTED; 0 B A K E R S F I E L D CITY MANAGER'S OFFICE 1501 Truxtun Avenue Bakersfield, CA 93301 (661) 326-3751 Fax: (661) 324-1850 TO: Linda S, Vernon Date: September 28, 2006 Bakersfield Assoolatlon of Realtom Fax #: 661- 635-2317 Pages: 2 From: City Manager's Omce Subject: Budget and Finance Committee meeting B A K E R .S F I E L D CITY MANAGER'S OFFICE 1501 Truxtun Avenue Bakersfield, CA 93301 (661) 326-3751 Fax: (661) 324-1850 To: Linda S. Vernon Date: September 281 2006 Bakersfield Association of Realtors Fax #: 661- 635-2317 Pages: 2 From: City Manager's Office subject: Budget and Finance Committee meeting ,~ B A K E R S F I E L D Mike Maggard, Chair Irma Carson Harold Hanson Staff: John W. Stinson MEETING NOTICE BUDGET AND FINANCE COMMITTEE of the City Council - City of Bakersfield Monday, October 2, 2006 - 10:00 a.m. City Manager's Conference Room, Suite 201 Second Floor - City Hall, 1501 Truxtun Avenue, Bakersfield, CA AGENDA 1. ROLL CALL 2. ADOPT AUGUST 28, 2006 AGENDA SUMMARY REPORT 3. PUBLIC STATEMENTS 4. DEFERRED BUSINESS A. Discussion and Committee recommendation regarding WiFi (wireless Internet service) - Stinson/Trammell B. Discussion and Committee recommendation regarding PG&E Smart Meter Project use of City light poles - Rojas 5.. NEW BUSINESS A. Discussion and Committee recommendation regarding Business Licensing for Real Estate Firms - Smith 6. COMMITTEE COMMENTS 7. ADJOURNMENT Bakersfield Association of REALTORS® Page 1 of 2 Your one-stop source for ensuring your success [] Find a Property and growing your business! [] See Open Houses [] Find a MLS/REALTOR® ~[] Print Member Roster [] R=__ental Specialis_ ___. _t [] Why Use a REALTOR® 1[] Home Buying Tips ,~ A DiviSion of the Bakersfield Association Of-REALTORS® [] Consejos Para La Compra De Una Casa Staff . [] About Our Community j ......................................................................... BAKERSFIELD ASSOCtATZON OF REALTORS® I[] About Our Association 4800 Stockdale Highway, Suite 100 [] Bakersfield, CA 93309 , Membership Application (661) 635-2300 FAX (661) 635-231_7~..~ ]Real Estate Career - . -- J'[]Sch°larships2' ~EmaiEXecutiveOfficer~Linda S. Vernon ~[] School :Info Direct: (661) 635-2304 linda@bakersfieldrealtor.com [] Driving Instructions ,-~,~, Assistant Manager/Bookkeeper Jean Parks SAFE ROAD', Direct: (661)635-2307 SAVE UVES Email: parks@b_akersfie drea tor.com E-Gear/Computer Systems Manager ]amey S. Lyster Direct: (661) 635-2312 Emaih ja meyC~bakersfieldrealtor.com Right Gear ~,~, Karen Huffman Work with someone who'll Direct: (661) 635-2302 work with you. Email: karen@bakersfieldrealtor.com i We're REALTORS® Communications Director Corrine Coats ! Rea Estate is our ~ Direct: (661) 635-2305 iLife Email: corrine@bakersfieldrealtor.com Pro Gear Claudia Bugarin (A-D) Direct: (661) 635-231:L Email: claud a@bakersfleldrealtor.com Pro Gear Cathy Ruiz (E-K) http://www.bakersfieldrealtor, com/story/view.aspx?id=71 9/27/2006 ADMINISTRATIVE REPORT I MEETING DATE: September 27, 2006 AGENDA SECTION: Consent Calendar ITEM: ~. TO: Honorable Mayor and City Council AP,~ROVED FROM: Raul Rojas, Public Works Director DEPARTMENT HEAD DATE: September 20, 2006 CITY AMT~AR~~CITY SUBJECT: Refuse Collection Services: 1. Agreement with Kern Refuse Disposal, Inc. regarding Refuse Collectior~ Services. 2. Resolution Consenting to the Assignment of the Rights and Obligations under Agreement 99-329 from Kern Refuse Disposal, Inc. to Metropolitan Recycling Corporation, for existing lease of a portion of City's property located adjacent to the Woodwaste Facility (Ward 1). RECOMMENDATION: Budget and Finance Committee recommends approval of Agreement. Staff recommends adoption of Resolution. BACKGROUND: In 1991, City and Kern Refuse Disposal, Inc. (Contractor) entered into a refuse hauling agreement. When the City required Contractor to convert to automated refuse collection in 1996, the refuse hauling contract was extended from 2005 to the year 2014. Contractor made the request for an extension of the agreement to recapture its investments in new automated equipment. With the end date of 2014 approaching, Contractor has requested another time extension to the year 2025, to continue being able to finance replaCement equipment for the hauling contract and to ensure a revenue stream for the Contractor's long-term debt service on a separate construction and demolition material recycling facility. Contractor submitted a written request on January 3, 2006 which was then referred to the Budget and Finance Committee. At the February 8, 2006 Budget and Finance Committee meeting, staff presented a list of items to consider in exchange for the value of the time extension. The Budget and Finance Committee then directed staff to enter negotiations with Contractor. Because the agreement had been amended so many times, the parties agreed to draft an entirely new document. The new agreement was presented to the Budget and Finance Committee on August 28, 2006. The Committee voted to' recommend the proposed agreement to the City Council. The refuse collection rates will continue, as in the original agreement, to be adjusted annually according to the consumer price index (CPI) for all urban consumers in the Los AngeleS-Orange-Riverside Area. Changes made by this agreement include: 1. Clarification and further definition of what factors may warrant rate changes other than those provided for in the CPI. For example, the City and Contractor have had differing views as whether fuel prices and worker compensation costs are reflected in the CPI. Clarifications September 20, 2006, 8:31AM G:\GROUPDA'ISADMINRPT~2006\09-27\Refuse Hauling Agreement Extension.doc ADMINISTRATIVE REPORT have been made to protect the City, and a previously used 6% threshold on CPI rate adjustments has been removed to protect the Contractor. 2. Clarification that future refuse cart replacement costs will not warrant a Contractor rate increase. 3. Standardization of a few miscellaneous charges for refuse related services, which have historically varied among the various hauling operators within the contract. This consistency will better serve the public with less confusion over rates for special pick ups and bin deliveries. 4. Finalization of a June 2008 deadline for the Contractor's construction and demolition recycling facility to be fully open to the public, as originally intended by separate agreement in 1999. If the Contractor fails to have the recycling facility open to the public by June, 2008, the extension of the agreement until 2025 ceases to exist and the original agreement termination date of June 30, 2014 is reinstated. 5. Simplification of the method by which the City maintains a 50 percent distribution of hauling services between municipal and contractor collection operations. 8. Determination that future waste collection program changes, if needed, shall have rates based on City cost studies with input from contractor. 7. Broadening of an existing clause which allows rate adjustments (up or down) based on landfill distance, to include provision for the distance to refuse transfer stations or recycling facilities which the City may require the use of. The method for automatic annual rate adjustment, based on the CPI, will continue for the term. of the agreement, committing the City until 2025. While this method has resulted in a significant cumulative rate increase over many years, the method is generally more stable than other methods of adjusting for rising operating costs, which may at times cause rate spikes. Additionally, in 1999, the parties entered into a lease agreement, whereby Contractor leased a certain portion of City's property located adjacent to the woodwaste facility. The property was leased so that Contractor could provide a construction and demolition recycling facility. The facility is being managed and operated by a corporation known as Metropolitan Recycling Corporation (MRC). MRC is made up of the same entities which comprise Contractor's corporation. Contractor desires to assign its rights and obligations in that lease to MRC. The lease agreement requires City to approve such an assignment in writing. js/kb September 20, 2006, 8:31AM G:\GROUPDAT~ADMINRP'I52.006\09-27\Refuse Hauling Agreement Extension.doc AGREEMENTNO. " REFUSE COLLECTION AGREEMENT -THIS AGREEMENT is made and entered into on , by and between the CITY OF BAKERSFIELD, a municipal corporation and charter city, ("CITY" herein)·and .KERN REFUSE DISPOSAL, INC., a Califomia corporation, ("CONTRACTOR" herein)i ·RECITALS . WHEREAS, CONTRACTOR' Was.incorporated 'in the year 1967 by various commercial' refuse cOllectors engaged in the business of collecting refuse, pursuant to 'refuse collection service franchises issued by Kem County within the unincorporated areas of the County that adjoin the CITY. The· corporation was formed to act as a conduit for the purpose of enabling commercial refuse collection to provide, through a single entity, refuse collection serviCes within those UninCorporated 'areas of the County· that were, and still are, .from time to time .annexed to the CITY;. and WHEREAS, CiTY maintains and operates its Own municipal refuse colleCtion service in part, but not all, of the CITY.· As a consequence, it is the CITY's desire to make Certain the inhabitants of those parts' of the CITY Which. are not serviced by it and the inhabitants of newly-annexed territories reCeive substantially the same efficient . refuse collection services from refuse collectOrs as do the citizens who are serviced by the CITY; and WHEREAS, on April 10, 1991, CITY and. CONTRACTOR entered int° an agreement whereby CONTRACTOR would provide refuse collection ServiceS for various areas of CITY ("the 1991 Agreement"); and WHEREAS, the 1991 Agreement has 'been amended several times because of changed conditions or to clarify the intent of the original document or terms defined therein·, The 1991 Agreementwas supplemented by Agreement No. 96-63 dated March 20, 1996 (the "Supplement") and by Amendment No. 3 to.Refuse COllection Agreement No. 91-71 as set forth in Agreement No. 91-71(3) dated June' 11, 1997 (the "Amendment"); and .- .. WHEREAS, the 1991 Agreement as amended is set to expire in june, 2014;:and WHEREAS, CONTRACTOR has reqUested an 11-year contract extension for the purpose of enabling CONTRACTOR to enter into longer term financing arrangements for its hauling purposes and to fulfill its financial commitments for the Mt. Vemon· Avenue Construction and Demolition Facility; and Refuse Colleclion Agreement KemRefuseCollectionAgrtinal August 24, 2006 - Page ] of 18 ])ages -- WHEREAS, CITy is amenable to such contract extension ProViding certain Conditions are met and believes it would be beneficial for all parties to amend and restate the 1991 Agreement, including the Supplement and the-Amendment, in its entirety; and · WHEREAS, refuse cartS provided by CONTRACTOR to homes and business in 'CITy under the 1991 Agreement have been in service for a number years and have a limited service life; and WHEREAS, the parties acknowledge that such Carts will most' likely wear Out ~pdor to the propOsed termination date of this Agreement; and' WHEREAS, the carts may require· replacement at considerable cOst to CONTRACTOR during the proposed termination date of this Agreement; and · WHEREAS, CONTRACTOR understands that it will not receive additional Compensation for such cart replacement; and WHEREAS, CONTRACTOR and CITY shall Work-.together to· schedule such replacement of carts to avoid unnecessary travel and labor costs related to the delivery of the replacement carts and removal or disposal of wom-out carts; and WHEREAS, it may be necessary.· or desirable from time to time for CITY and CONTRACTOR to offer other refuse collection options to residences and businesses or' to make changes to the existing collection services; and - ..· WHEREAS, CITY may provide altemate facilities for CONTRACTOR to deliver waste and recyclables collected; and WHEREAS, it is the parties' intent that, if alternate facilities are established for the delivery of waste and recyclables by CONTRACTOR,-the rates paid to CONTRACTOR shall be adjusted based upon cost studies and/or pilot programs, taking · · information supplied by CONTRACTOR into account; and ~. · WHEREAS, CITy is contemplating phasing out extra tan-colored trash carts in. faVor of .blue carts (recYcling containers); and WHEREAS, CONTRACTOR understands that Such phase out/phase in may occur during the term of this Agreement and the ·parties will further negotiate if such phase out/phase in comes to pass; and ' WHEREAS, beCause CONTRACTOR consists of several independent haulers, miscellaneous serviceS incidental to refuse hauling have not been 'uniformly defined ·or charged fOr on a consistent basis; and WHEREAS, the parties desire to agree upOn definitions for 'such miscellaneoUs services; and Refuse Collection Agreement · Kem RefuseCollectionAgrfinal August 24, 2006 -- Page 2 of 18 Pages -- · · WHEREAS, the Califomia Air Resources Board's Refuse Collection Vehicle· Rule requires any public agency refuse collection .contract entered into after December 2004 provide that' the· CONTRACTOR will comply with all applicable air pollution control laws;. and WHEREAS,' CONTRACTOR is aWare of such laws and will-comply.. With them'; and WHEREAS, in 1999, CITY and CONTRACTOR entered into Agreement No. 99~ · 329 which .was amended on May 10, 2000 (collectively the "Lease Agreement")'. · Whereby CONTRACTOR leased a portion of CITY's greenwaste facility to construct and Operate a Construction and DemOlition Facility ("the Facility"); and WHEREAS, ~Pursuant to the Lease Agreement, the Facility was to be open to the public for deposal of construction and demolition debris and the Facility is not yet fully oPen to the public; and · · WHEREAS, CONTRACTOR' has indicated that its desire for an 11-year contract'. extension is to .allow.it to assure any lenders of .the viability of CONTRACTOR's business in order to procure loans and other financial ·support to ·it for its refuse service work, as well as for the FaCility; and -- WHEREAS, CONTRACTOR ·has further indicated that it anticipates having the .. FaCility open to the public byJune, 2008;' and .. WHEREAS,. CITY is amenable to this time frame providing CONT·RACTOR agrees to further conditions as stated herein; and WHEREAS, the parties desire to make certain amendments, sUpplements, modifications, and clarificationS to the' 1991 Agreement as supplemented and amended by the Supplement and the Amendment; and · · · WHEREAS, the parties desire to amend and restate the 1991 Agreement; NOW, THEREFORE, incorporating the foregoing recitals herein, CITY and CONTRACTOR hereby 'mutually agree to amend and restate the 1991 Agreement. (including the Supplement andAmendment) aS fOllows: · AMENDED AND RESTATED REFUSE COLLECTION AGREEMENT 1. DEFINITIONS. As used in this Agreement, the following words shall have the meanings hereafter set forth unless the context indicates otherwise: '· 1.1 "Account" shall mean a place of business or residence' where refuse is generated and collected and a fee is charged for the collection service. Refuse ColleCtiOn Agreement Kern RefuseCollectionAgrfinal ' · · August 24, 2006 -Page 3 of l $ Pages -- 1.2 "A.Uthorized representative''· shall mean any person or· persons designated in writing by CITY or CONTRACTOR, as the case may be, to ·act on its behalf, whenever auth°.rized to do so by this Agreement. ' ·· ··· ·~ ' 1.3 "Automated" or"semi;automated" equipment shall mean eqUipment i m°unted on a refuse Collection truck which is capable of lifting a cart cOntaining up to·~ one hundred five (105) gallons or more (as specified by CITY) of refuse· and depositing the contents thereof into' the bed of the truck. 1.4 "Carts" shall mean barrel-shaPed reCeptacles, comm°nly known as universal carts,, mounted on-wheels and designed for the storage' .of residential' or .' ~.' commemial refuse, greenwaste or recyclables pending the collection of Such'refUse by CITY or CONTRACTOR throughthe use of automated or semi,automated equipment~ .1.5 "CITY" shall mean the.City of Bakersfield. ~ .. 1.6 "C0mmemial refuse"' shall mean refUse 'generated by commemial and industrial enterprises and apartment houses and similar· mUltiple dwelling· '' complexes which do not qualify as residential units as that term is defined herein. 1.7 "Construction and Demolition Facility" means that facility lOcated at 26'01 Mt. Vemon Avenue which sorts mixed construction and other demolition debris. 1.8 "CONTRACTOR'' shall mean Kern Refuse DispOsaI,·lnc. · 1.9 "ExpansiOn areas" shall mean unincorporated·· areas of the County annexed into CITY at any time. 1.10 "Greenwaste, shall be as that term is construed by CITY under. Chapter 8.32 of the Bakersfield Municipal Code. · 1.11 "Laborde Area" shall mean that portion of the CITY Outlined on the map attached heret° as Exhibit "C". which shall be excluded in determining the division. . .... of accounts in ParagraPh 2.2. .... 1.12 "Member collectors" shall mean and refer to the commercial refuse collectors who are holders of the ·refuse collection serVice franchises issUed by Kern ·· · County and who also own stock issued by CONTRACTOR. · 1.13 "Miscellaneous serViCes" shall mean·any of the following: (a) Special and/or extra pick up charges (b) Retum trip charges (c) Temporary bin delivery, pick upand'rental · (d) Locking bin service fee (e) Handling.overloaded containers Refuse Collection Agreement Kern RefuseCollectionAgrflnal ' August.24, 2006 -- Page 4 of ! $ ?a§¢s -- .. · 1.14 "Refuse" shall mean refUsel garbage, swill and rubbish as defined in SeCtion 8.32.020. of the Bakersfield Municipal Code.' .. · 1.15 '"Refuse services" shall' mean: (a) · .Residential services for one ·through four unit'dwellings using ' · refuse and greenwaste cart service or bulky item removal service, based on the number · of dwelling units.' · (b) Bin· service for .multiple ·unit dwellings, businesses, and.;· nonresidential properties, based on cubic yards as a measurement. "~ ' '. (c) Compacto~ services fOr. large refuse volume locations. '. generating Over twelve cubic yards of refuse per day, unless designated for bin service by the. City Manager or representative. Shall not include small compactors which are fitted to regularly serviced frontloading bins holding three or less cubic Yards, which are included in (b) above. ·-· (d)· Rolloff service (as defined in Paragraph 1.18) for disp°sal.°f refUse in large quantities 'deemed by the City Manager or representative to be unsuitable for disposal in carts, bins, or compactors. · · ~1.16 "Residential refuse" shall mean refuse generated at residential 'nits . 1.17 "Residential unit'' shall mean a house or other structure.designed. for and occupied by a single family, with the exception.of aPartment houses, condominiums located in apartment house-like complexes and structures containing four (4) or more families for which detachable bins are commonly utilized t° collect the refuse generated at such structures.· '1.18 "Rolloff service'' shall mean the delivery, transportation and maintenance of supplied containers that are 'approximately eighteen feet (18')' to ·twenty- two feet (22') long, holding an approximate maximum of fifty (50) cubic~ yards of material. The rolloff containers may either be open or sealed at the top. Containers holding compacted or compressed materials shall not be included in the definition of rolloff. - 2, CONTRACTOR'S' RIGHTS AND. OBLIGATIONS, 2.1' Except as otherwise provided in this Agreement, CONTRACTOR, through its member collectors, shall collect and dispose of all refuse ·from accounts · assigned by CITY and on file with CITY's authorized representative, as modified by exchanges of accounts as may be made from time-to-time.-. Refuse Colleclion Agreement Kern RefuseCollectionAgrlinal August 24, 2006 - Page 5 of 18 Pages -- 2.2 With respect to refuse and greenwaste Collection serviCes to be )rovided in expansion areas, CITY and CONTRACTOR agree to a division .of accounts· in such expansion areas in such a manner as to accomplish lthe goal to maintain an equal division.of refuse Services provided by CITY and CONTRACTOR throughout the CITY. Such division shall be as set fOrth below: CITY- % CONTRACTOR .... . % Compactor 100% . Rolloff .. 100%*** Residential 50% - ReSidential ' .50% · .... " Bins 50% . Bins · :. "50% · ***(With the exception that City provides rolloff service to community, eVents.and ~other nOncommercial needs on a limited bases.) . With respect to the future division of. any' acCounts, all accounts in the Laborde Area shall be.excluded from the numerator and denominator in determining the equal division of accounts consistent with current practices. Any accounts in expansion areas that' were existing and served by any of the member collectors prior to' the annexation shall be allocated ·to CONTRACTOR' and shall be .taken into' account·in determining ·the .. percentages of new accounts to be allocated 'between CITY and CONTRACTOR as provided herein, and the City shall have a priority allocation of an 'equal number of' accounts in Expansion Areas in Order to achieve an equal divisiom For example, if an Expansion Area includes 50 accounts improved with residences and being serviced by a member collector of CONTRACTOR as well as 80 undevelOped Iots,.CONTRACTOR' · Shall be allocated the 50 accounts improved with residences,··ClTY shall be allocated i the first 50 ·of accounts, from undeveloped lots, and CITY and CONTRACTOR shall each be. allocated 15 of the remaining 30 undeveloped lots.-After development of the lots, in order to prevent inefficiencies' in provision of service, the parties may request an exchange of· accounts pursuant to Paragraph 2.8 herein. Such 'exchange shall keep · · ·· with the spirit of this Agreement that the CITY and CONTRACTOR maintain' a 'division 'of accounts consistent with the chart above. CONTRACTOR understands and.agrees that CITY must comply with Public Resources Code Section 49520 with respect to all non-member haulers legally operating in the Expansion Areas. 2.3 Each 'member colleCtor shall establish routes and maps delineating such routes for each type of service (residential, commercial, rolloff) said routes and maps shall be filed with and approved· by CITY's authorized representative; once approved, said maps or' routes shall not be altered without the approval 'of CITY's authorized representative. '" 2.4 Commercial collection may start as early ·as`· 6:00 a.m., with its frequency to be determined by CITY's authorized representative or· as required by the·. Refuse Collection Agreement KemRefuseCollectionAgrfinal August 24, 2006 - Page 6 Of ].8-?ages ...... Calif°mia Integrated Waste Management· Board (CIWMB) or its designated loCal 'enforcement agency (LEA), but in no event 'shall the number ·of collections exceed six (6) per week.. ... · . · 2.5 . On automated routes, starting no earlier than 6:00 a.'m.,· residential Collection shall be collected once per week fOr .refuse (tan carts) and once per week for greenwaste (green' carts); thereby, collecting twice per week, with no longer than ninety- six (96) hours between each collection. ·· · '2.6 The time schedules' ··and frequency of service delineated ·in the preceding paragraphs shall not be disrupted, changed or altered by virtue of any· holiday.· other than the holidaYs 'mentioned herein. The frequency of service or the routes approved by CITY's authorized, representative' shall not be 'changed or· altered as the result of 'any road'condition, road construction," or weather condition, without th · approval of CITY's aUthorized representative. · ..... 2.7 The holidays for which service may .be disrupted by the member · collectors without penalty or deduction from the compensation payable by· :CITY. to CONTRACTOR under this Agreement are: Christmas, New Year's· Day, Thanksgiving, and any other hpliday during which the landfills operated by Kem County, or the · greenwaste facility operated by CITY, are officially closed in commemoration~of said ~ holiday and inaccessible to CONTRACTOR's member collectors for· the· disPosal of refuse or greenwaste which would have.'been collectible on that day. Automated routes. must be servicedthe next working day or Saturday folloWing the holiday.' · 2.8 CITY.·presently is proViding refuse and greenwaste collection · services to accounts not presentlY served by CONTRACTOR.~ During the term of this. . Agreement, CITY shall continue to provide refuse and greenwaste collection services for these accounts. If both parties would mutually benefit by 'more -economical servicing of particular accounts through'an exchange of accounts, .either party may· request the exchange of a member collector's· accounts for CITY accounts;, however, ..Such exchanges shall be made only uPon mutual ·written consent of both parties. ··· ··. ·· 2.9 The process of collection shall inClUde the thorough .emptying of all ... containers and handling said containers so as not to cause unnecessary damage. The' area adjacent to the place of collection shall be kept free and clear' of all rubbish and litter resulting from the performance· of the collection, and to this end each truck shall be equipped with brooms and shovels. 2.10 Collection shall be made by courteous,· comPetent and orderly emplOyeeS, and in such a manner so as not'to create safety problems or a nuisance'by unduly trespassing on priVate property, loUd and unnecessary noise and :interfering unneceSsarily with traffic. 2.11 Refuse and greenwaste·shall be collected and transPorted in substantially fly-proof and leak-proof refuse vehicles. Such vehicles will be painted an~ Refuse Collection Agreement KernRefuseCollectionAgrfinal August 24, 2006 - Page 7 of ]8 1)ages .... identifying color scheme, different from CITY's, cleaned inside:and· Out, and maintained · by CONTRACTOR. · 2.12 All materials collected by member collectors pursuant ·to this Agreement shall become and remain the property of CONTRACTOR~; CONTRACTOR may .dispose of .said material at its own site provided it meets all apPlicable state and County landfill requirements, or any public dump or dumping facility; Provided, 'hoWever, that CITY shall be responsible for payment of any and all gate fees; .tipping fees, or any other charge imposed by Kern County~ for the disposal of all materials collected ·by CONTRACTOR pursuant to .this Agreement in a· county or other landfill in· which suCh .gate fees, tipping fees or similar charges are imposed. ' ' ·· 2.13 CONTRACTOR agrees to make periodic spot checks°f the' green carts for contaminatibn. Contamination shall be defined ·as a .green .cart cOntaining material not designated as greenwaste under Chapter.8.32' of the Bakersfield Municipal COde; When CONTRACTOR discovers that a green cart contains 'contaminating -· 'materials, CONTRACTOR shall not' pick up the greenwaste cart 'but .shall tag said cart and timely report to the' City of. Bakersfield that the' Cart was contaminated. The CitY of Bakersfield Shall then take whatever action it deems necessary 'to ·cOrreCt-the contamination situation.' .. 2.14· CONTRACTOR shall fumish each .reSidenCe-and certain~ Small businesses receiving, automated service from CONTRACTOR with a tan cart to be USed for the deposit of. refuse. All such carts shall' be supplied by CONTRACTOR at its sole cost and expense. CONTRACTOR shall maintain all such carts in good condition and repair ' (except that it is the customer's responsibility to keep'the carts clean)' and shall replace or repair any carts not in good condition at its sole cOst and expense; provided, -however, that if a cart is damaged or destroyed throUgh the fault or negligence of the ...... · occupants of the residential unit or business for which it was supplied, CONTRACTOR, with CITY's written consent, may· recover the cost resulting from the person who was · responsible for the 'damage or destruction. In the event that CITY receives ·a significant number of Complaints regarding the condition of· the tan carts 'in ~any neighborhood serviced ~ by CONTRACTOR, .CITY may require CONTRACTOR to replace all carts in such neighborhood at the-sole .expense of CONTRACTOR. In such 'event, CITY and CONTRACTOR shall Work together ·to avoid unnecessary travel and labor costs related· to the· delivery of the replacement carts, and CONTRACTOR shall receive no. compensation for ·either the carts or the delivery costs. ' ·' · . 2.15 CITY shall fumish each residence reCeiving automated service frOm CONTRACTOR with a green cart to be' 'used for the depOsit of greenwaste, All such carts shall be supplied by CITY at its sOle cost and expense. CITY shall maintain all such carts in good condition and repair (except that it is the customer's, resPonsibility to keep the carts clean) and shall replace or repair any carts not in good condition at its sole cost and expense; provided, .however, that if a cart is damaged or destroyed . through the fault' or negligence of the occupants of the residential .unit or the fault or negligence of CONTRACTOR, CITY may recover the cost therefrom from the person who was responsible for the damage or destruction. Refuse Collection Agreement ... · KemRefuseCollectionAgdinal August 24, 2006 -Page 8 Of ! 8 ?ages -- · - 2.16 Some residences were given two tan carts for refuse. CITY is 'C°ntemplating phasing out .extra tan carts and rePlacing them .with blue carts for recycling. CITY and CONTRACTOR shall negotiate in good faith any increase or '" · decrease in rates resulting from the phasing out/phasing in of the second tan carts.· 3.. RESIDENTIAL REFUSE. ..' ..... ' 3.1 · The collection' *process for the collection'of residential refuse generated within CITY areas serviced by CONTRACTOR's member collectors shall be throUgh the use of carts and automated'or semi-automated equipment. Accordingly,/· within, the time periods Prescribed, CONTRACTOR's member collectors shall, at their ' · sole .cost and expense, acquire the carts and equipment needed to 'implement the '" " residential refuse collection process described herein. 3.2 All ·carts acquired by cONTRACTOR for areas serviced ~by its member cOllectors and all carts utilized by CITY in areas serviCed· by ·it shall be · substantially similar in design, specifications and color. ·It is agreed that CITY shall ·· specify the designi specifications and color of such carts after its authorized: · representative has conSulted .with CONTRACTOR's authorized rePresentative in 'goOd faith. · '·: 3.3 Unless otherwise specified by CITY, the maximum storage capacity fOr carts acquired· bY CONTRACTOR pursuant to this Agreement shall' be one hundred five (105) gallons; the minimum capacity· for such carts 'shall be sixty (60) gallons. The. · capacity of a cart to be suPplied by CONTRACTOR· to a residential unit shall be determined by· the needs of such unit or as specified by CITY's authoriZed. 'representative. . ~. 3.4 · From time-to-time'routes will be in existence wherein member-' .... .collectors will pick;up greenwaste in both CITY and County areas with a single 'vehicle.. " Consequently, there Will be occasions when a truck will contain-greenwaste which has been collected within CITY's areas and greenwaste which will have been collected in County areas. Under these circumstances, the entire truckload of greenwaste will be delivered to CITY's Mount Vemon Processing Facility. Upon arrival at the facility, a· record will. be made concerning .the estimated, percentage of the load which is'~* attributable to the collections in CITY and the collections made in the County.· When the'- records indicate that an amount equal to a full truckload of greenwaste attributable to County collections has arrived at the facility, that full truckload, will, at CONTRACTOR's. expense, be delivered to the County landfill, or· other facility specified bY the COunty. CITY and County may, among themselves, agree otherwise in writing; however, shoUld no agreement be reached between CITY and· the County, CONTRACTOR shall adhere · · to the terms of this provision. ' · · 3.5 CITY shall provide, at its own eXpense, residential educational programs, including workshops, to teach CITY residents how to use the tan and green Refuse Collection Agreement Kern RefusecollectionAgrfinal August 24, 2006 . -- Page ~) of ! 8 Pa§es .... carts for automated equipment collection.' CONTRACTOR will coOPerate With CITY in this educational program. 4. SMALL BUSINESS CART SERVICE. 4.1. CONTRACTOR shall provide collection service for commercial irefuse to businesses as designated bY CITY using carts in areas where aUtomation is implemented. 4.2 The price .paid'to CONTRACTOR' for,the 'smalI business cart .. .service. shall be as set forth in Exhibit "A." Said exhibit is incorporated, herein by reference as though fully set forth. *. .. .. .. 4.3. CONTRACTOR shall provide the small business collectiOn service carts to designated customers without charge, CONTRACTOR shall maintain the .carts in the same manner as provided in the residential 'service.'. · · 5. ROLLOFF SERVICE. 5~1 Under rolloff service the term "delivery" shall mean transporting the container to the customer's address and'depositing the container for use. by Customer. Delivery of the container shall be a "pass through" cost, payable to CONTRACTOR. 'q'ransported~ shall mean the custOmer has required the container be'removed and' the . conta!ner has either been exchanged.for'anempty one or has been transpOrted to the final destination such as a. recycling facility or landfill, .unloaded and 'replaced' at' the " .customer's address if requested. '~ . 5.2~ CONTRACTOR will perform rolloff service on behaff of CITY .and i forward billing information, as required by CITY, to CITY for processing of billing information to the customer and payment to CONTRACTOR. CONTRACTOR will be paid within thirty (30): days of billing by CITY t°. customer. Compensation for rolloff service shall:be as set forth in Exhibit "A." . . · 5.3 R°lloff. service *shall include, but not b;e limited, to,-:placement.of empty rolloff containers .for ..loading by customer, removal of the.container and.' 'replacement thereof if so requested by customer, maintenance of containers in a safe, · clean and operable, condition including suitable painting. Containers shall be removed within twenty-four (24)i hours of a request for such removal by customer. - ~.' .'.. · .... · 5.4 CONTRACTOR shall indemnify, defend, and hold harmless*CITy, its officers, agents and employees againSt any and all liability, claims, actions, causes of · actions 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 CONTRCTOR, CONTRACTOR's employees, agents or independent contractors or companies in the performanCe of, or in' any way arising from, providing rolioff Services to customers under the provisions of this Agreement' whether or not 'caused in 'part by a party indemnified hereunder. CONTRACTOR shall, at CONTRACTOR's sole cost, Refuse Collection Agreement Kern RefuseCollectionAgrlinal · August 24, 2006 -- Page ]0 0£]8 ?a§es ...... comply· with all the requirements of· Municipal, ·State, and Federal authorities nOw: in · force, or which hereafter may be in force, pertaining to the r°lloff provisions of this · Agreement. · 5.5 CONTRACTOR shall cause all rolloff container custOmers, or their Property designated agents, to execute contracts, or agreements for rolloff services in a · form approved.-bY CITY.. 'No service shall be given without~ tl~e· proper, written authorization by customer except where CONTRACTOR agrees in writing to assume all obligations of the cuStomer as set forth in CITY's authorized form.'·. 6, COMPENSATION. · .. ~ · 6.1 For and-in consideration of the services to be~ performed by CONTRACTOR through its member collectors pursuant to this Agreement, CITY shall · . pay CONTRACTOR. for-residential, commercial, and rolloff services as follows: · 6.1.1 CITY shall pay CONTRACTOR for serviCes according to the rate schedule, attached hereto and incorporated herein as Exhibit "A;" .... 6.1.2 Commencing on the' fiscal year beginning On JUly ·1, 2006, and thereafter atthe commencement of each fiscal year, the Consumer Price Index of · the United States Commerce Department for Los. Angeles, .Riverside and .orange · County shall be consulted and ·the·rates to be paid to .CONTRACTOR for residential and commercial service· shall be revised upward or downward according to'the percentage of difference-·between the cost of living factor reflected·by such publication for the month · of January immediately preceding the fiscal year under consideration and the coSt of living factor reflected by the publication for the mOnth of January of the year before. · 6.2 At the ·end of each' 'month,' CONTRACTOR shall bill CITY for ·all services performed by its member collectors.during suCh month. Within thirty (30) days thereafter, CITY shall pay CONTRACTOR for all such services in accordance with. the· · rates payable at the time that the services were performed. · · 6~3 Except as set forth in Paragraph 6.5, CONTRACTOR.agrees that ·* the rates set forth in the preceding paragraphs (subject· to· adjustment pursuant to · Paragraphs 2.14, 6.4, 6.6, and/or·6.7) shall be the exclusive compensation payable'to .... CONTRACTOR for services performed by its member collectors under this Agreement; CONTRACTOR shall not bill or·attempt to secure compensation for such services from private property owners or residents unless it is directed to do so bythe CITY pursuant. to a billing procedure mutuallY agreed upon by the parties... - '. 6.4 The parties may review the rate schedule referred to above upon request of either CITY or CONTRACTOR no more than ·one time per .year for the purpose of making such equitable adjustments in the rates (upward or downward) as ··' may be mutually agreed upon to offset increases or decreases in the operating costs of CONTRACTOR's member collectors caused or brought about by: Refuse Collection Agreement KernRefuseCollectionAgrfinal ' August 24, 2006 - Page ll of 18 Pages -- . . . 6.4.1 Changes in existing Federal, State or local laws 'or regulationsgovemingthe collection and disposition of refuse and greenwaste; 6.4.2 Increases or decreases in the distances to disposal sites or waste processing facilities; . 6.4.3The imposition or removal of "tipping" .or ,gate fees" in~ · connection with landfil!s; 6?.4 increases' or decreases in the. frequency of commercial collections required by' the CITY's authorized representative or as 'reqUired. by the ClWMB or its' LEA; .. 6.4;5 Any other factor or condition beyond the. control of. either party other than the' cost of living factor mentioned in paragraph 6.1.2 herein. · 6.4.6 A factOr or condition beYond thecontrol of either party shall mean any of the following: .. .. · ' 6.4.6.1.1 Cost increases and decreases where the caUSe of the cost increase or decrease .is not common to industries providing goods and services .measured in the consUmer.price index process; orl 6.4.6.1.2 The' cause of the cost increase or decrease, must not be able to result either.directly.or indirectly, in .a change:or a Portion .of change in subsequent consumer price index adjUStments' (i,e., increased fuel ' costs, as they are. factored into the consumer price index) or 6.4.6.1,3 The cause, of the cost increase or decrease must be due to a natural :disaster, an unforeseen change in regulatory requirements, a change in operations at the requeSt of the CITY (i.e., increased number of pickups, etc.)' or a loss of fixed physical assets beyond the limitsof reasonable insUrance. 6.5 CONTRACTOR shall charge 'customers· directly .f°r Miscellaneous Services ipursuant to the schedule~.attached hereto as Exhibit "B,,' 'and. incorporated herein by,reference,. ... 6.6 CiTY reserves the right to establish new collection programs, Such as curbside recycling,- :. FOr any such new program CITY shall establish a pilot prOgram, perform cost studies or both. CONTRACTOR *agrees that the rates CONTRACTOR shall, receive for any such service connected with any new program shall bethe rate set forth as a result of 'the pilot program, .cost studies or both, as well as input frOm CONTRACTOR. 6.7 CITY reserves the right to alter the delivery point for dumping of such Waste, greenwaste and/or recyclables. In the event CITY changes such location, Refuse Collection Agreement . Kern RefuseCollectionAg dinal . . · August 24, 2006 '" -- Page 12 of 18 Pages -- the rates herein shall be adjusted Pursuant to· paragraph 6.4· herein and input from CONTRACTOR. · .... -. '~ 7. ~ GENERAL TERMS AND CONDITIONS. '. · ·7.1 If* CITY receives any comPlaint concerning the failure of CONTRACTOR to perform any service required by this Agreement, it Will. communicate ' said complaint by telephone, either to the member .collector against whom the complaint apPlies or to CONTRACTOR, and the complaint shall receive the prompt attention of said.'member collector or CONTRACTOR. As to complaints conceming the failure of'a member collector to make a pick-up, CITY shall describe with specificity the location ·of'~ the reSidential or commemial unit involved.· ' 7.2. if.a complaint conceming the failure of a. member, collector.to-"" .' perform a service pursuant to this Agreement, or to make a pick-up, is received'by·CITY · · and communicated to the responsible member collector or to CONTRACTOR prior to · 1:30 P.m., the service Shall be performed or the pick-up shall be made by the member' ·· cOllector or CONTRACTOR on the same day. If such cOmplaint is received by CITY and communicated to the member collector or CONTRACTOR after 1:30 p.m., the· service shall be performed or the pick-up shall be made On the following day. ' '·· .... 7.3 If a member collector or CONTRACTOR fails to perform the service· or make the pick-up as required by paragraph 7.2, within the times specified by paragraph 7..2~.. then CITY may perform the service or make the pick-up, on behalf of the ' ' member collector or CONTRACTOR; CITY shall then deduct from any ·monies due CONTRACTOR, orif none are due, it shall bill CONTRACTOR for twice the actual costs incurred by CITY in performing the .service or making the pick-up. Nothing contained in· 'this paragraph shall be conStrued to constitute a waiver on the part of CITY to terminate this Agreement for cause · 7.4 The failure of any party to enfome against the other a .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 t° vary the terms of this Agreement.. 7.5 Any lawsuit pertaining to any matter arising under or growing out of this Agreement shall be inStituted in Kern County, Califomia; 7.6 Time is of the esSence in this Agreement. --~ 7.7 This Agreement .shall not be assigned bY any party, or any party ' substituted, without prior written consent of all the parties. 7.8 The rights and obligations of this Agreement shall inure to the benefit of, and be binding upon, the parties to ·the contract and their heirs, administrators, executors, personal representatives, successors and assigns. -·· Refuse Collection Agreement .. KemRefuseCollectionAgdinal ' August 24, 2006 "~, - Page 13 of 15 Pages .... '. · 7,9 This Agreement sets forth the entire agreement between the· Parties, and supersed~es all other oral or Written provisions. This Agreement. may be modified only in a writing authorized by the CITY Council and signed by all parties. 7.10 Each individual executing this Agreement representsand warrants that they are duly aut. horized to execute and deliver this Agreement on' behalf of the iparty they purport to. represent, and this Agreement is binding uPon said party in· accordance with its terms. · 7.11 Except as otherwiSe proVided herein, CONTRACTOR .shall at .... .CONTRACTOR's sole cost, complywith all of the'requirements of MUnicipal, Stateand Federal AUthOrities now in force, or which may ~hereafter be in force, pertaining to this Agreement, and shall ifaithfullY observe in all activities relating to or growing Out of this Agreement all rules or regulations now in force .or which may hereafter be in-force, including, but not limited to, Califomia Air Resources Board's Refuse' Collection Vehicle 7.12 CITY and CONTRACTOR'entered into Agreement No. 99-329 as amended ("Facility· Lease,) to facilitate the operation of the Construction' and Demolition Facility. CONTRACTOR has assigned its-rights and obligations· .under. the Facility Lease to its sister corporation, Metropolitan Recycling Corporation ("MRC"). Pursuant to ·Agreement No. 99-329, the Facility was to be open to the .public, To date; that has · not happened. As CITY has agreed to .extend the term-°f, this Agreement to. 2025 to ..- enable CONTRACTOR to fulfill its long-term· financing obligations and to 'expedite the opening of the Facility fully.to the public, 'CONTRACTOR agrees that. the Facility shall · be fully.open 'to the general pubic no later than June 30, 2008.. ·.· · ~· 7~13 This Agreement calls for the perfOrmance of·~the services ~of · 'CONTRACTOR as an· independent contractor, ·and CONTRACTOR. will-not be considered an .emploYee of CITY for any purposes and is ·not entitled to any of the benefits provided by CITY to its emPloyees. This Agreement shall not be construed as · forming a partnership or any other association with CONTRACTOR other than .that of an ·· independent contractor. ~ ....... 7.14 CONTRACTOR .shall indemnify, defend, and hold harmless CITY,. its· officers, agents and employees 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 CONTRACTOR, CONTRACTOR's employees, agents or independent contractors or companies 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; ..... "' '. 7.15 INSURANCE. In addition tolany other insUrance Or bond.required... under this Agreement, CONTRACTOR shall procure and maintain for the duration of this Agreement,. at its :sole cost and expense, the following types and limits of insurance ("basic insurance reqUirements" herein): Refuse Colleclion Agreement Kem RefuseCollectionAgrfinal August 24, 2006 - Page 14 of 18 Pages -- · 7.15.1 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: · . .7.15.1.1 Provide coverage for owned, non-owned ~and · -7.15.2 Broad form commercial general 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: 7.15.2.1 Provide contractual ;liability .coverage-'for' the · "~ terms of this Agreement... ..... 7.15.2~2 Provide products~ and completed Operations coverage. ' 7.15.2.3 Contain an additional insured endorsement in favor, of 'CITY, its. mayor, council,, officers,.".. ~ " 'agents,. employees and volunteers. -' ' 7.15.3 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 CITY, its mayor, council, officers, agents, employees, and .designated volunteers. ~ · 7.15.4· All policies required·of CONTRACTOR shall be·primary insurance as to CITY, its mayor, council, officers, agents,.···employees or designated volunteers and any insurance-or, self-insurance maintained by CITY shall be excess of CONTRACTOR's insurance and shall not contribute with it. .7.15,5 .. Except for workers' compensation, insurance is to be ' placed with insurers with a Bests' rating as approved .by CITY's Risk. Manager,~ but in'no ~ eventless than A:V. Any deductibles, self-inSurance retentions, or insurance in lesser amounts, or lack of certain types of insurance otherwise required by this Agreement,. 0r. insurance rated below Bests' A:V, must be declared prior to execution of this Agreement/ and approved by CITY in writing 7.15.6 Unless otherwise approved by CITY's Risk Manager, all ···. · policies shall contain an endorsement providing 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. Refuse Collection Agreement . ~ ... · Kern RefuseCollectionAgrfinal August 24, 2006 -Page 15 o£ ]8 ?ages 7;15.7 The insurance required hereunder shall.be maintained at all times during the ten~ of this Agreement or any extension thereof.~ 7.!5.8 CONTRACTOR shall fumish CITY's Risk Manager with a certificate of insurancel and reqUired endOrsements evidencing the inSUrance required.·· 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. ~.. "' . 7,15,9 Full compensation, ' ' for all 'premiums · which CONTRACTOR 'is required, to paY-on all. the '.insurance described herein .shall 'be considered as included in the. prices paid. for the various items of work to 'be PerfOrmed under the AgreementI and no additional allowance will be made therefore or for.. additional .premiums which may be required by extensions of the policies of.inSurance.," ." 7.!5.10 It.is fUrther understood and agreed by CONTRACTOR that its liability to CITY"shall not in any way be limited to or affected by the· amount of insurance obtained and carried by CONTRACTOR in connection.with this Agreement. ~- · . .7.15.11 Unless otherwise approved, by 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 CITY has approved lesser insurance requirements for CONTRACTOR. " '7.16 CONTRACTOR shall maintain accurate accOUnting .recOrds .and' other wdtten documentation pertaining to-all costs incurred in performance of .this ..Agreement. Such records and documentation shall be' kept at CONTRACTOR's office · during the term of thiS!Agreement, and for a period of three (3) years from the date of the .final payment hereunder, and said records shall be-made available to CITY· representatives upon request at any time during regular businesshours. . · .. 7.17 .In.ithe .event of a conflict between the terms,'-Conditions' or specifiCations set forth in this Agreement and those .in exhibits attached hereto, the" '. terms, conditions, or sPecifications set forth in this Agreement shall prevail: All exhibits. to which .reference is made in.this Agreement are deemed .incorporated in this. Agreement, whether or not actually attached. · ~' ' - -7.18 CONTRACTOR's Federal Tax Identification NO.; 95-26420261 CONTRACTOR is acorporation? Yes X .. No. .~ (Please check one) 7.19 This Agreement is effective upon execUtion. It is. the product of' negotiation and all pa~ties are equally responsible for authorship of this Agreement. Section 1654 of the California Civil Code 'shall not apply to-the interpretation of this Agreement. .. Refuse Collection Agreement KemRefuseCollectionAgrlinal August 24, 2006 - Page 16 of 18 Pages -- · 7.20 No officer or employee of CITY shall· hold any intereSt in this Agreement (Califomia Goyemment Code Section 1090). .' · .... 7.21. The accePtance of work or services; or payment for work or · services, bY CITY shall not constitute a waiver of any provisions ofthis Agreement. . · 7.22 ' 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 three (3) days after depositing in the united States mail. The parties· shall be addresSed as follows or at any other address designated by notice: .. 'CITY: CITY OF BAKERSFIELD . 1501 TruxtUn Avenue· ~ Bakersfield, Califomia 93301-.. · .' ~.. CONTRACTOR: KERN REFUSE DISPOSAL,'INC. 1808 Roberts Lane · Bakersfield, Califomia 93308' 8. TERM RELATED.. MATTERs, · 8.1 The term of this Agreement shall, be effective upon. approval by the City Council and Satisfaction 0.f the condition' set forth in paragraph 8..2 beloW and Shall terminate on June 30, 2025 subject to early termination as ·provided in Paragraph 8.2 · below. In addition, ·the CITY may terminate this Agreement at any.time during the term for cause. Cause, as· used herein, shall mean the'CONTRACTOR's failUre to cure ·any· default in-the terms and conditiOns of this Agreement within thirty (30) days. after. '· receiving a written notice from the CITY to cure. such default; provided, CITY shall not · · declare CONTRACTOR in default for the failure of any· member collector ·to-perform' any cOnditions contained in this Agreement if failure is due to an act of God, an act of.war, .labor strikes or any other caUse beyond the control of the CONTRACTOR or such member collector. Under no circumstances shall CITY. be required to compensate CONTRACTOR for services not performed, 'regardless of the reason for non- performance. · 8.2 In the event that the Construction.and Demolition Facility is not· fully open to the general public by June 30, 2008, CITY shall have the right, by written notice to CONTRACTOR given any time prior the FaCility opening fully to-the general public, to reduce the length of the term so that it expires and this Agreement shall terminate on · June 30, 2014.- [Signatures continue on next page] .·· Refuse Collection Agreement ' KernRefuseCollectionAgrlinal August 24, 2006 --Page 17 of 18 Pages IN WITNESS WHEREOF, 'the parties-hereto have caUsedthis Amended and Restated Agreement to be executed, the day and year first-above written,' "CITY"- : "CONTRACTOR"... ~ ' CiTY OF BAKERSFIELD KERN REFUSE DISPOSAL, INC~ HARVEY L. HALL Mayor.. P - ' AppROVED AS TO CONTENT: . PUBLIC WORKS DEPARTMENT ' ... · By: ,/ ~ ' '~:I~UL ROJAS' Public Works Director *' · APPROVED AS TO 'FORM: VIRGINIA GENNARO · . City Attomey '~ . .. .BY: · ' y//JANICE SCANLAN ..... ~/ ASsistant City Attomey - .. InsuranCe, .,~ COUNTERSIGNED: By:. NELSON SMITH Finance Director Attachments: Exhibit "A" - Rates for Small Carts and Rolloffs Exhibit "B" - Miscellaneous Services Exhibit "C" - Map of Laborde Ama Certificates of Insurance · Refuse Collection Agreement , KemRefuseCollectionAgdinal August 24, 2006 - Page l 8 of 18 pages E USE D sPOS^L, HC. 2006-07 RATE SCHEDULE Single Family Dwelling Unit 7/1106 FY 2006-07 12.19 COMMERCIAL Commercial Carts Are Collected lx Per Week CART SERVICE 1 Large Cart / eachch $12,02 Small Cart / ea $10.88 COMMERCIAL DETACHABLE Number of Collections Per Week BIN SERVICE I 2 3 '4 5 6 Container Size/Cubic Yards 1.5 $38:42 $48.01 $69.23 $90.64 $111.90 $133.25. 2 $46~91 $58.60 $82.62 $106.61 $130.58 $164.56 3 $55.36 $69~23 $96.01 $122.57 $149.23 $175.90 *Multiple Bin Rate 1.5 $116.33 2 $138.17 3 $160.00 ~Multiple Bin Rate: 3 or more bins serviced six (6) times per week @ the same location Compactor Rolloffs: Compactor rolloff service is not provided by contractor COmpactor Bin Rate: Three times the detachable bin service rate Extra Residential Cart: $6.68 per month County or Hauling Other Gate Delivery Rental Per Load Fees ROLLOFF SERVICES: $83.58 $6.14 $170.38 Pass through Rental starts on the 8th to customer day after delivery or haul. RATES EFFECTIVE: July 1,2006 S:\FILING\800 KERN REF DISP\Rates -Kem Refuse\06-07RATES.xls RATE COMPARISON COB and CONTRACTORS Temp Bin I Delivery I. Special Dump I Extra Locking Service "Dump .. I Company Return Trip Fee .)lu Fee Rental Fee Handling of Overload Containers $50.00 for Gravity..,15100.00 Del/Dump/Remove Howard's Lock I '$50.00 each, dump. They do dump overload bins I Ddvers 51 $0.0(~$50.70 + $ 5:70 cc, if No Monthly. Fee**. $25.00 Monthly, Rental , Discretion - Judgment Bin Size plu Fee CGF 1.5cy $12.00 + $2.85~ $5.00 per month Delivery $20.00 South Side 2.0cy $12.00 + $3.80 Lock & Key is. ,Remove $20.00 They do dump overlOad bins I Ddvers 52 $0.00 3.0cy $12.00 + $5.70 supplied for Cust. Dump $35.00 + CGF if Corn Discretion - Judgment $0.00 same area/ Bin Size plu Fee CGF NO -Customer Delivery $50.00 Superior $100.00 Hr if truck 1.5cy $ 26.00 + $2.85 must have Dump $50.00 They do dump overload bins I Drivers 53 dispatched back 3.0cy $ 36.00 + $5.70 container unlocked Rental $25.00 if no dump Discretion - Judgment Bin Size p/u Fee CGF !$5.00 per month $0.00 same area/ $ 1.5cy $ 25.00 + $2.85 ;Lock & Key is $152.60 month/delivery $40.1 NO - Lids must be Closed / Vamer Bros 45.00 if truck 2.0cy $ 27.00 + $3.80 !supplied for Cust. $43.80 1st I $43.80 Last Rental Attempt is to accommodate the 54 dispatched back !3.0cy, $ 30.00 + $5.70 Gravity Lck $23.50 $ 25.001CGF if Corn customer. Overloads maybe dumped lx fee of $100.00 They do dump overload bins / Ddvers Vamer & .. includes lock bar. Delivery $50.00 Discretion - Judgment. Extremely Sons Customer supplies Dump $50.00 ovedoad bins left unless customer 55 $0.00 $50.001 not reported key or combo Rental $50.00 if no dump states they w!ll clean up spillage. $6.85 2006-O7 .............. $34._85~_20_._.0~__.-07. $34.85 2006-07 $6.50 Monthly Fee $33.06 same area/ $33.06 each dump~ Customer to supply $66.12 if truck CGF included, vehicle' specific type combo NO - Level load, lids must be able to COB . :dispatched direct weic~lhed (~} landfill lock Cob refers to contractors be closed or considered over loaded Deliver $ 50.00 $6.85 per weekly Dump $ 50.00 Extra Dump Fee $34.85 pick up. Phase out Bin must be dump Ix within New $34.86 same area manual lock I 30 daY time period. Standard $69.70 if required Cart Service $18.53 migrate to gravity Limit temporary bin to no July 06 t° dispatch truck Includes CGF., locking system, longer than 6 to 8 weeks. S:\FILING~Jwilburn\Rate Comoarison.xls P~n~. 1 RESOLUTION NO. A RESOLUTION OF THE COUNCIL OF THE CITY OF BAKERSFIELD CONSENTING TO THE ASSIGNMENT OF THE RIGHTS AND OBLIGATIONS OF AGREEMENT 99- 329' FROM KERN REFUSE DISPOSAL, INC. TO METROPOLITAN RECYCLING CORPORATION. WHEREAS, in 1999, the City and Kern Refuse Disposal, Inc., (Kern Refuse) entered into Agreement' No. 99-329 whereby Kern Refuse leased a certain portion of the City's property to construct and operate a concrete and demolition recycling facility (the Facility); and WHEREAS, the Agreement was amended in 2000, to reduce the size of the leased premises; and WHEREAS, the Facility has been managed and operated by Metropolitan Recycling Corporation (MRC); and WHEREAS, the Facility was supposed to be fully open to the public, but, to date, that has not occurred; and WHEREAS, any assignment of Kern Refuse's rights under Agreement No. 99- 329 must be approved in wdting by the City; and WHEREAS, Kern Refuse desires to assign its rights and obligations in the lease to MRC and MRC desires to take over such rights and obligations; and WHEREAS, the City has no objection to Kem Refuse assigning its rights in Agreement 99-329 and the amendment thereto to MRC. NOW, THEREFORE, BE IT RESOLVED, incorporating the above recitals herein, by the Council of the City of Bakersfield as follows: 1. That the above recitals are true and ,correct. 2. The City hereby consents to Kern Refuse Disposal, Inc.'s assignment of all its rights and obligations under Agreement No. 99-329 and any amendments thereto .to. Metropolitan Recycling Corporation. 3. The Assignment Agreement between Kern Refuse Disposal, Inc. and Metropolitan Recycling Corporation is attached hereto as Exhibit "A". Page 1 of 3 Pages S:\COUNCIL~esos\06-07 Resos~kemrefuseassignment.doc 4. Nothing in this consent will relieve Kern Refuse Disposal, Inc. of any of its obligations contained in its agreement with the City of Bakersfield for refuse hauling services approved the same day as this resolution. Page 2 of 3 Pages S:\COUNCIL\Resos\06-07 Resos~kemrefuseass~gnment.doc 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: COUNCILMEMBER MAGGARD, CARSON, BENHAM, COUCH, HANSON, SULLIVAN, SCRIVNER NOES: COUNCILMEMBER ' ABSTAIN: COUNCILMEMBER ABSENT: COUNClLMEMBER PAMELA A. McCARTHY, CMC CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED HARVEY L. HALL Mayor of the City of Bakersfield APPROVED as to form VIRGINIA GENNARO City Attorney By: JANICE SCANLAN Assistant City Attorney Page 3 of 3 Pages S:\COU NCIL\Resos\06-07 Resos~kernrefuseassignment. doc E~IBIT "A" .ASSIGNMENT OF RECYCLING FACILITY GROUND LEASE THIS ASSIGNMENT OF RECYCLING FACILITY GROUND LEASE '(the "Assignment"), which is dated and effective as of June 1, 2000, is entered into by and between .KERN REFUSE DISPOSAL, INC, a California corporation ("Assignor") and METROPOLITAN RECYCLING CORPORATION, a California corporation ("Assignee"). RECITALS WHEREAS, the City of Bakersfield, a mUnicipal corporation ("City"), as Lessor or City, and Assignor, as Less(~e, executed Agreement No. 99-329 Recycling Facility Ground Lease dated December 15, 1999 (the "Original Lease")with respect to the premises described therein; WHEREAS, the Original Lease was amended by City and Assignor pursuant to Agreement No. 99-329(1), Amendment No. 1 to Agreement No. 99-329 dated May 10, 2000 (the. "Amendment'i) whereby the premises leased were reduced and relocated; WHEREAS, Assignor desires to assign to Assignee all of its right title and interest in the Original LeaSe and the Amendment (collectively the "Lease") and Assignee desires to receive all of Assignor's right, title, and interest in the Lease and assume all of Assignor's obligations under the Lease; NOW, THEREFORE, in consideration of the mutual covenants and conditions contained herein and incorporating by this reference the foregoing recital.s, the parties hereto hereby agree as follows: 1. Assignor hereby assigns to Assignee all of its right, title, and interest in the Lease and the premises leased thereunder. 2. Assignee hereby assumes all of Assignor's obligations under the Lease and agrees to indemnify; defend, and hold Assignor harmless from all costs, expenses, and liabilities relating to or arising from the Lease which occur or arise after the effective date of this Assignment as first set forth abOve. IN WITNESS WHEREOF, the parties have executed this Assignment to be effective as of. the date first written above. KERN REFUSE DISPOSAL, INC., a California corporation ("Assignor") .? B y ~~.~~/'=~ ~1~ "'> ' .,1 f MEm~.~TAN RECYC CORPORATION, a California corporation ("Assignee") 330 Chestnut Ave. Bakersfield~ CA 9330~ 6§1-t17-1171 Office' August 28, 2006 To: Budget and Finance Committee of the City Council - City of Bakersfield RE: Considerations to the MetroFi proposal now being reviewed and an alternate proposal to City of Bakersfield for city wide Wifi. After many hours of research, and years of experience, I believe the MetroFi proposal outlined by the last Council Budget and Finance Committee meeting leaves the City of Bakersfield in a very vulnerable and awkward position. The points outlined below are but the tip of the ice burg in risks the City of Bakersfield. There are many cities trying many different approaches to this new Wifi concept. I think that the City of Bakersfield should take the time to review and evaluate the various concepts in use today but only after a track record of each has been established. Bakersfield should not be on the bleeding edge of the Wifi revolution when so much is at risk. Taking time to see proven results is the way the city should proceed. Having a contract with MetroFi is not enough. One has to believe in the heart this service is needed by the citizens and is the best option available for our city. a. MetroFi is not a profitable company to date. They are a blue sky startup venture at this point. b. MetroFi was founded and is managed by people that bankmpted a previous leading edge company called COVAD. c. None of the MetroFi wired cites have produced any documentation or analysis on the success or failure of their Wifi network concept. d. Free advertising to support an Internet network has not proven to be viable by past startup companies. Intemet searches show banner ad business is not as popular as it once was. e. Some cities that tried a similar free ad concept have failed. Sacramento is one example. f. Cities that have wireless networks in place with documented success all charge for services. g. The Banner ad software used by MetroFi causes site information to be unreadable in the upper portion of the screen. This causes support issues that could be substantial. h. Other issues like PG&E, real coverage area, visual site of antennas are all important to review. i. Free Intemet has yet to be studied to determine the risk to young children not fully supervised. Bakersfield's exposure could be substantial in this area. Many abductions of the young and crime to the oldest of our community is wide spread on the Internet today and must be considered in any network proposal that the city of Bakersfield is endorsing and promoting. In an effort to provide a citywide Wifi network without the dependency, risks and liabilities that are inherent in the MetroFi proposal, I have developed a model that will achieve the similar results, but leaves the city harmless from possible court actions and other legal misgivings. My proposal includes local internet vendors and businesses in the formation of the network which I believe is a very important part of a project. Local companies are more committed to Bakersfield. Provisions for a taxing structure that the city can use to support its own Internet needs and other costs are all part of this model. The issue of free Internet is also addressed but in a more responsible manner. I look forward to the possibility of presenting my model to the city. Sincerely David C. Rogers Owner Electronic Towne Crier Internet Provider B A K E R S F I' E L D Mike Maggard, Chair Irma Carson Harold Hanson Staff: John W. Stinson SPECIAL MEETING NOTICE BUDGET AND FINANCE COMMITTEE of the City Council - City of Bakersfield Monday, August 28, 2006 - 1:00 p.m. City Manager's Conference Room, Suite 201 Second Floor- City Hall, 1501 Truxtun Avenue, Bakersfield, CA AGENDA 1. ROLL CALL 2. ADOPT JUNE 19, 2006 AGENDA SUMMARY REPORT 3. PUBLIC STATEMENTS 4. DEFERRED BUSINESS A. Update RePort and Committee recommendation regarding Refuse Hauling Contract extension negotiations - Rojas/Bames B. Discussion and Committee recommendation regarding WiFi (wireless Intemet service) - Christensen 5. NEW BUSINESS 6. COMMITTEE COMMENTS 7. ADJOURNMENT F,~? F~ ~.~. '.'r~ :M,~:.'.. >' ::{.'~ ~: .~ ~T:.:"' ..~ :'/". '~' :~: ':..,[~- '::: >.'-: ~ .'~ i { :~ X~'i. L.< "~. :'" i' ;L .'.~' ;:~' r~':~.~-'2777:' ;'~ ::;~'~ '~: ';, ~L:'~ :?:;, ....... ~ ~_ ~ ~ .~ .' ..." .~ ". '.." .,''.' '... 8/24/~06 3:40 P~ EDITOR - THE g ~7519 Cover*! ~ OK ~R44EOC88E .? ..~ AI~~ 8/24~06 ~40 P~ NE~S DESK- C. 334-2~85 ~er+~ O.OK ~R44ED~8~ 8124~06 3:40 PM' OPINION PAGE ~7380 ~over+~ ~ DA ~R44EDC~ 8/24/~06 3:40 PM BUILDINGINDU..: 633-1317 Ce~e~+l ~OK ~R44EDC88~ 8/24/~3:40PM KEND~L~ARS... 28~3 Co~+I ~ OK ~R44EDC88~ 8/24/2~ 3'40 P~ CHILES WAID. ~5-7814 Cov¢+1 ~ OK ~R44EDC88~ 8/24/200g 3:40 PM THE MINORI~ 323-9~ Ce~e~+l O OK ~R44ED~8~ 8]24~ 3:40 PM KWAC SPANISH . 327-0~? Co~+1 ~ OK ~R44EDC~:  8~4120~3:40PM KU~-45KU~_ 328-7~7 ~e~+l ~ OK ~R44EDC88~ ~ 8~4/20~ 3:40 PM KLLY 9~FM-~. 393-1~5 Cover+l ~ OK ~B44EDC88~ 8~41~0~3:40PM K~NE~RO... 283-2963 Co~er*l ~ OK ~R44EDC88~ 8/24/~06 3.40 PM KGET TV-1Z NE... 283-1843 ~¥er+l ~ OK ~R44EDC~ 812412006 3:40 ~ KERO TV-23 NE.. 323-5538 Cover+l ~ OK ~R44EDC~ 8~4/20~3:40 PM KERN-KGEO-KG... 3~-0388 Co~er+~ ~'OK ~44EDC~ 8/24/20~ 3'40 PM KB~ TV-29 NE... 8~1-9810 Cove'-" ~ OK ~44EDC88~ _ 8/24/2006 3:40 P~ EDITOR - EL PO.- ~-1~1 Core,+1 ~.OK ~R44EDC~.' ~ 8~4/20~i40 PM EL ME~NO ;... 3~1 ' ' Co~+I ~ OK ~R44EO~8~"  8/24/2006 3:40 ~ GREATER ~KE: 327-8~1 Core,+1 ~ OK ~R44ED~8~ 8~4/2006 3.40 PM DAVID BURGER 395-7519 Co~e~+l ~ OK ~R44EDC~ ~ 8~4/200g ~40 PM EDITOR - THE B 324-9472 Co~er+l ~ OK ~R44~DC88[ ~ 8/24~006 t40 PM B~LE MEMOP ~31-9439 Cover+l O OK ~R44ED~ ~ ~24/~06 3:40 PM GOVERNMENT .. 635`2317 Cover+l O OK ~R44EDC~ ~ ~24~0~ 3:40 PM ~THY EDDY - K. 8~-3190 Cover+l ~OK ~R44EDC~ ~i~c~~ bf06 Aug 213 Oe(ument name: 'Microsoft Word - Oocumen~2' · ' ' ~ 'Flme sen~: 4:25:02 ~ 8/24/~06 ~. "'" "'" ': '":, .... : ::., ".' :~-L ~:~' ~'' : ..: "~:'~.~ Page 1 of 1 Karla Arellano - Address for David Rogers From: Jean Parks To: Karla Arellano Date: ' 8/24/2006 8:11 AlVl Subject: Address for David Rogers David Rogers, Owner ., . Electronic Towne Crier 330 Chestnut Avenue Bakersfield, CA 93305 file://C:~Documents and SettingsLkarellano\Local Settings\TempLXPgrpwise\44ED5F3BCI... 8/25/2006 electronic ll;o~mne ~rier 330 Chestnut Ave. Bakersfield, CA 93305 661-327ol 172 Office August 28, 2006 To: Budget and Finance Committee of the City Council - City of Bakersfield RE: Considerations to the MetroFi proposal now being reviewed and an alternate proposal to City of Bakersfield for city wide Wifi. After many hours of research, and years of experience, I believe the MetroFi proposal outlined by the last Council Budget and Finance Committee meeting leaves the City of Bakersfield in a very vulnerable and awkward position. The points outlined below are but the tip of the ice burg in risks the City of Bakersfield. There are many cities trying many different approaches to this new Wifi concept. I think that the City of Bakersfield should take the time to review and evaluate the various concepts in use today but only after a track record of each has been established. Bakersfield should not be on the bleeding edge of the Wifi revolution when so much is at risk. Taking time to see proven results is the way the city should proceed. Having a contract with MetroFi is not enough. One has to believe in the heart this service is needed by the citizens and is the best option available for our city. a. MetroFi is not a profitable company to date. They are a blue sky startup venture at this point. b. MetroFi was founded and is managed by people that bankrupted a previous leading edge company called COVAD. c. None of the MetroFi wired cites have produced any documentation or analysis on the success or failure of their Wifi network concept. d. Free advertising to support an Internet network has not proven to be viable by past startup companies. Internet searches show banner ad business is not as popular as it once was. e. Some cities that tried a similar free ad concept have failed. Sacramento is one example. f. Cities that have wireless networks in place with documented success all charge for services. g. The Banner ad software used by MetroFi causes site information to be unreadable in the upper portion of the screen. This causes support issues that could be substantial. h. Other issues like PG&E, real coverage area, visual site of antennas are all important to review. i. Free Intemet has yet to be studied to determine the risk to young children not fully superVised. Bakersfield's exposure could be substantial in this area. Many abductions of the young and crime to the oldest of our community is wide spread on the Internet today and must be considered in any network proposal that the city of Bakersfield is endorsing and promoting. In an effort to provide a citywide Wifi network without the dependency, risks and liabilities that are inherent in the MetroFi proposal, I have developed a model that will achieve the similar results, but leaves the city harmless from possible court actions and other legal misgivings. MY proposal includes local internet vendors and businesses in the formation of the network which I believe is a very important part of a project. Local companies are more committed to Bakersfield. Provisions for a taxing structUre that the city can use to support its own Internet needs and other costs are all part of this model. The issue of free Internet is also addressed but in a more responsible manner. I look forward to the possibility 0fpresenting my model to the city. Sincerely David C. Rogers Owner Electronic Towne Crier Intemet Provider PUBLIC STATEMENTS SPEAKER'S CARD Bud,qet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: ~._ ~ ,~ Company/ Organization: ~'~_._---~_.~'~¢'Z.~/0/~---T~~ Address: ~:~ 0~-~-'~'~'-~ ~ '~~ Phone: '~c~Z.-3 -! j ~ Z_ Fax/e-mail:~ Subject: tt/~J t ~ I PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date ~/o~ (,,,' You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majodty vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Company/ ._...--.--- Organization: ~TY'J.~ Address: Phone: ~'~-'"/-'"') )"'7 ~ Fax/e-mail:~-L::~---3c~,,~'c-7~.~ Page 1 of 1 Jean Parks - Budget & Finance Committee Meeting Agenda From: Jean Parks To: David Rogers Date: 6/16/2006 9:25 AM Subject: Budget & Finance Committee Meeting Agenda Attached is the agenda for the Budget and Finance Committee meeting on Monday, June 19th at 10:00 a.m. in the City Manager's conference room. file:ftC:\Documents and Settings\jparks\Local Settings\Temp\GW} 00001 .HTM 6/21/2006 BAKERSFIELD May 17, 2006 Department of TranSportation Audits and Investigations 1304 O Street, Suite 200 Sacramento, CA 94274-0001 Attn: .Maura F. Twomey Dear Ms. Twomey, Thank you for your examination of the City 'of Bakersfield's indirect cost rate proposals for the FY 2002/03 and 2003/04 and also for the approval of such rates. We have carefully reviewed finding number 1 from your report dated May 16, 2006 that relates to the Department of Public Works procedures for tracking indirect labor. We will incorporate your recommendation into the City's current time keeping procedures by requiring the DPW to code all labor hours worked with an identifier (project) code. We believe that this procedural change will strengthen the City's internal controls and documentation standards associated with the Federal regulations sited in your audit finding. If you have any questions or need any additional information please feel free to contact me. Sincerely, Nelson K.' Smith Finance Director Cc: Gary Yarber, FHWA Gary Buckhammer, Division of Accounting DLAE, District 6 City of Bakersfield · Finance Department · 1501 Truxtun Avenue S:~d.~n~..,,~ca~r,...~,o.~2ooo.do~ Bakersfield · California · 93301 (661) 326-3742 · Fax (661) 852-2040 · l-mail: flnance@bakersfieldcity, us ADMINISTRATIVE REPORT I MEETING DATE: July 19, 2006 I AGENDA SE, C, TION: Consent Calendar ITEM: I~. TO: Honorable Mayor and City Council , ~ .APPROVED FROM: Raul M. Rojas, Public Works Director DEPARTMENT HEAD.//.L_ DATE: June 14, 2006 CITY ATTORNEY ' CITY MANAGER SUBJECT: Acceptance of 2004-05 Transportation Development Act Funds Financial Stateme~hts. RECOMMENDATION: Staff recommends referral to Budget and Finance Committee. BACKGROUND: In compliance with the Kern Council of Governments Rules and Regulations, the California Public Utilities Code Section 99245, and the California Code of Regulations section 6664, the attached financial statements for the Transportation Development Act Funds were prepared for the fiscal year ending June 30, 2005. The financial statement summarizes fiscal activity for the Bikeway and Pedestrian Fund, and the Public Transit Fund. The accuracy and the fairness of the presentation is the 'responsibility of the City. The audit firm of Macias, Gini & Company has issued an unqualified opinion. No other reports were issued by the accounting firm in regards to the above audit report. June 14, 2006, 1:54PM G:\GROUPDA'r~DMINRPT~2006\07-19\Transp Dev Act Funds Financial Stm.doc cITy OF BAKERSFIELD Transportation Development Act Funds Independent Auditor's Reports, Fund Financial Statements and Supplementary Information For the Fiscal Years Ended June 30, 2005 and 2004 MACIAS' GINI ~ COMPANYLLP C E RTl FI E D P U B LIC ACCOUNTANTS ~, MA N AG E M E NT C.O N S U LTA NTS CITY OF BAKERSFIELD Transportation Development Act Funds For the Fiscal Years Ended June 30, 2005 and 2004 TABLE OF CONTENTS Page(s) Independent Auditor's Report ................................................................................................................ 1-2 Fund Financial Statements: Balance Sheets - Bikeway and Pedestrian Special Revenue Fund ............................................................ 3 Balance Sheets - Amtrak Operations Special Revenue Fund .................................................................... 4 Statements of Revenues, Expenditures and Changes in Fund Balance (Deficit) - Bikeway and Pedestrian Special Revenue Fund ......................... ~ ............................................................ 5 Statements of Revenues, Expenditures and Changes in Fund Balance- Amtrak Operations Special Revenue Fund .............................................................................................. 6 Notes to the Fund Financial Statements ................................................................................... . .............. 7-9 SuPpletnentary Infortnation: Budgetary Comparison Schedule - Bikeway and Pedestrian Special Revenue Fund .............................. 10 Budgetary Comparison Schedule ~ Amtrak Operations Special Revenue Fund ............... ....................... 11 Note to Supplementary Information ......................................................................................................... 12 Other Report: "" Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government :.. ~ A~tditing Standard~ and the Transportation Development Act .......................................................... 13-14 I I ! I ! I I i ! ] MACIAS GINI ~ COMPANYLLP 515 S. Figueroa Street, Ste. 325 Los Angeles. California 90071 213.286.6400 PHONE 2 I 3.286.6426 FAX To the Board of Directors Kern Council of Govermnents Bakersfield, California To the City Council City of Bakersfield Bakersfield, California · INDEPENDENT AUDITOR'S REPORT We have audited the accompanying financial statements of the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund of the City of Bakersfield, California (City), as of and for the fiscal years ended June 30, 2005 and 2004, as listed in the table of contents. These financial statements are the responsibility of the City's management. Our responsibility is to express opinions on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Compt!:911er General of the United States. Those standards require that we plan and perforn~ the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for [ designing audit.procedures that are appropriate in the circumstances, but~not for the purpose of expressing · ' an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we I express no such opinion. An audit also includes examining, on a test basis, evidence supporting the ':" amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement ! presentation. We believe that our audits provide a reasonable basis for our opinions. As discussed in Note 1, the financial statements present only the Bikeway and Pedestrian Special Revenue Fund and the 'Amtrak Operations Special Revenue Fund of the City and are not intended to present fairly the financial position of the City and changes in its financial position in conformity with accounting principles generally accepted in the United States of America. In our opinion, the financial statements referred to above present fairly, in all material respects, the II ' financial position of the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund of the City as of June 30, 2005 and 2004, and the respective changes in financial [1 position thereof for the fiscal years then ended in conformity with accounting principles generally accepted in the United States of ganerica. I www.rnaclasginl.com CERTIFIED PU[3LIC ACCOUNTANTS ~ MANAGEMENT CONSULTANTS In accordance with Government Auditing Standards, we have also issued our report dated January 30, 2006' on our consideration of the City's internal control over financial reporting as it relates to the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund and on our tests of its compliance with certain provisions of laws, regulations, contracts and ~ant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over fina.ncial reporting or on compliance. That report is an inte~al part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing-the results of our audit. Our audit was made for the purpose of forming opinions on the financial statements of the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund taken as a whole. The supplementary information as listed in the table of contents is presented for purposes of additional analysis and is not a requii'ed part of the financial statements of the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund. Such information has been subjected to the auditing procedures applied in the audit of the fund financial statements and, in our opinion, is fairly stated in all material respects in relation to the fund financial statements taken as whole. Certified Public Accountants Los Angeles, California January 30, 2006 CITY OF BAKERSFIELD Bikeway and Pedestrian Special Revenue Fund Balance Sheets June 30, 2005 and 2004 2005 2004 ASSETS Current assets: Due from other governn~ents. $ 50,813 28,167 Total assets $ 50,813 $ 28,167 LIABILITIES AND FUND BALANCE (DEFICIT) Current liabilities: Due to City's General fund $ 50,813 31,795 Total current liabilities 50,813 31,795 Fund balance (deficit) (Note 4) - (3,628) Total liabilities m~d fund balance'(deficit) $ 50,813 $ 28,167 The notes to the financial statements are an integral part of these statements. 3 CITY .OF BAKERSFIELD Amtrak Operations Special Revenue Fund Balance Sheets June 30, 2005 and 2004 2005 2004 ASSETS Current assets: Cash and investments (Note 2) $ 141,922 $ 153,665 Accrued interest receivable 1,586 904 Total assets $ 143,508 $ 154,569 Current liabilities: Accounts payable $ 18,305 $ 13,341 Deferred revenue (Note 3) 125,203 141,228 Total liabilities $ 143,508 $ 154,569 The notes to the financial statements are an integral part of these statements. CITY OF BAKERSFIELD Bikeway and Pedestrian Special Revenue Fund Statements 0f Revenues, Expenditures and Changes in Fund Balance (Deficit) For the Fiscal Years Ended June 30, 2005 and 2004 ~2005 2004 REVENUES Local transportation fund $ 50,813 $ 28,167 EXPENDITURES Bikeway and pedestrian 47,185 31,795 Change in fund balance 3,628 (3,628) Fund balance (deficit), beginning (3,628) Fund balance (deficit), ending $ $ (3,628) The notes to the financial statements are an integral part of these statements. CITY OF BAKERSFIELD Amtrak Operations Special Revenue Fund Statements of Revenues, Expenditures and Changes in Fund Balance . For the Fiscal Years Ended June 30, 2005 and 2004 2005 2004 REVENUES Local transportation fund $ 209,856 $ 196,371 h~terest and other 5,263 1,769 Total revenues 215,119 198,140 EXPENDITURES Public transit 215,119 198,140 Change in fund balance - Fund balance, beginning - Fund balance, ending $ $ - The notes to the financial statements are an integral part of these statements. 6 CITY OF BAKERSFIELD Transportation Development Act Funds Notes to the Fund Financial Statements For the Fiscal Years Ended June 30, 2005 and 2004 NOTE 1 - SUMMARY OF SIGNIFICANT AccOUNTING POLICIES The financial statements of the Bikeway and 'Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund (collectively the Transportation Development Act (TDA) Funds) of the City of Bakersfield (City) have been prepared in conformity with accounting principles generally accepted in the United States of America as applied .to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing govenunental accounting and financial reporting principles. The more sigmificant of the City's accounting policies are described below. Reportin_o Entity The TDA provides funding of public transportation through regional planning and progranm~ing agencies. Funds are allocated to the City through the county transportation planning agency, Kern Council of Govermnents (KCOG). The TDA Funds account for the City's share of the TDA allocations, which are legally restricted for specific purposes as detailed in applicable sections of the Public Utilities Code. The TDA Funds of the City are the Streets and Roads Special Revenue Fund (no activity in recent years), Amtrak Operations Special Revenue Fund and the Bikeway and Pedestrian Special Revenue Fund, and are included in the basic financial statements of the City. The TDA Funds are presented combined as a nomnajor governmental fund (State (TDA) Transpon~ation Special Revenue Fund in the City's basic financial statements. The accompanying financial statements present only the TDA Funds of the City and are not intended to present fairly the financial position and changes in financial position of the City in conformity with accounting principles generally accepted in the United States of/unerica. Fund Accountint The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund is accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The Bikeway and Pedestrian Fund and the Amtrak Operations Fund are governmental funds specifically categorized as a special revenue funds. Special revenue funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. Measurement Focus and Basis of Accountino. The Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. Local Transportation Fund revenue is recognized when all eligibility requirements imposed by the provider CITY OF BAKERSFIELD Transportation Development Act Funds Notes to the Fund Financial Statements (Continued) For the Fiscal Year Ended June 30, 2005 and 2004 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Measurement Focus and Basis of Accounting (Continued) have been met. Revenues are accrued when their receipt occm's within sixty days after the accounting period so as to be both measurable and available. Expenditures are generally recorded when a liability is incurred, as under accrual accounting. Revenues that are susceptible to accrual include local transportation fund allocations and interest income. When both restricted and mtrestricted resources are available for u,se, it is the City's policy to use restricted resources first, and then unrestricted resources as they are needed. Deferred Revenue TheAmtrak Operations Special Revenue Fund reports deferred revenue on their balance sheet. Deferred revenue for this fund arises when potential revenue does not meet both the "measurable" and "available" criteria for reco~fition in the current period or when funds have been received prior to eligibility requirements being met. In subsequent periods, when both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability for deferred revenue is removed from the balance .sheet and revenue is reco~onized. Interfund Transactions The City's General Fund allocates payroll and payroll related expenditures incurred to the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund. Amounts allocated to the Bikeway and Pedestrian Special Revenue Fund for fiscal years ended June 30, 2005 and 2004 were 550,813 and $31,795, respectively. Amounts allocated to the Amtrak Operations Special Revenue Fund for fiscal years ended June 30, 2005 and 2004 were $21,684 and $11,358, respectively. In addition, premiums paid for various risk management programs to the Self Insurance Internal Service Fund by the Amirak Operations Special Revenue Fund for the fiscal years ended June 30, 2005 and 2004 were $11,345 and $11,354, respectively. Risk Management The City administers various risk management progams, some of which rel'ate to the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund. The Finance Department transfers funds from the Amtrak Operations Fund to the Self Insurance Fund for the purchase of property insurance for the Amtrak Station per direction from the City's Risk Manager. The City's risk management programs are reported in the governmental activities and internal sen, ice funds in the City's basic financial statements. CITY OF BAKERSFIELD Transportation Development Act Funds Notes to the Fund Financial Statements (Continued) For the Fiscal Year Ended June 30, 2005 and 2004 NOTE 2 - CASH AND INVESTMENTS Cash balances of the' TDA funds are pooled with th6se of other funds of the City. Investment income resulting from this pooling is allocated among the funds based upon each respective fund's average cash balance in relation to the aggregate investment balance. Cash and investments for the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund include a fair value adjustment for the fiscal years ended June 30, 2005 and 2004 of $0 and $0, and $419 and $1,495, respectively. Further information regarding the City's cash and investment pool may be found in the City's basic financial statements. NOTE 3 - DEFERRED REVENUE The Local Transportation Fund (LTF) and State Transit Assistance Fund (STA) are administered by the Kern Council of Governments, which allocates funds to the City to fund its TDA operations. The TDA requires that any funds not used may be returned to their source. LTF and STA allocations are considered earned when they are properly spent for eligible projects. Allocations received but not earned are recorded as deferred revenue. Changes in the defen'ed revenue account for the fiscal years ended June 30, 2005 and 2004 are surmnarized as follows: Amtrak Operations Special Revenue Fund 2005 2004 Deferred revenue, July 1 $ 141,228 $ 64,902 TDA Allocations received 193,831 272,697 TDA Allocations earned (209,856) (196,371) Deferred revenue, June 30 $ 125,203 $ 141,228 NOTE 4 - DEFICIT FUND BALANCE Bikeway and Pedestrian Special Revenue Fund For fiscal year ended June 30, 2004, the Bikeway and Pedestrian Special Revenue Fund reported a deficit f~nd balance due to the fact that it spent in excess .of the TDA revenues allocated related to the Bike Lanes Paladino Extension. The excess was funded by botTowing funds from the City's General Fund. The deficit was eliminated during the year ended June 30, 2005. 9 SUPPLEMENTARY INFORMATION CITY OF BAKERSFIELD Bikeway and Pedestrian Special Revenue Fund Budgetary Comparison Schedule For the Fiscal Year Ended June 30, 2005 Variance Original Final Positive Budget Budget Actual (Negative) REVENUES Localtransportation fund $ 235,605 $ 235,605 $ 50,813 $ (184,792) EXPENDITURES Bikeway and pedestrian 235,605 235,605 47,185 188,420 Change in fund balance $ $ 3,628 $ 3,628 Fund deficit, begi~ming (3,628) Fund balance, ending $ See note to supplementary information. CITY OF BAKERSFIELD Amtrak Operations Special Revenue Fund Budgetary Comparison Schedule For the Fiscal Year Ended June 30, 2005 Variance Original Final Positive Budget Budget Actual (Negative) REVENUES Local transportation fund $ 344,976 $344,976 $ 209,856 $ (135,120) Interest income 3,000 3,000 5,263 2,263 Total revenues 347,,976 347,976 215,119 (132,857) EXPENDITURES Public transit 347,976 347,976 215,119 132,857 Change in fund balance $ . $ $ _ Fund balance, begi~ming _ Fund balance, ending $ See note to supplementary information. 11 CITY OF BAKERSFIELD Transportation Development Act Funds Note to Supplementary Information For the Fiscal Years Ended June 30, 2005 and 2004 NOTE 1 -BUDGETARY INFORMATION Ammal budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America for the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund. The City Manager is authorized to transfer budgeted amounts between departments within any fund and approve reductions of budgeted amounts. Since expenditures may not exceed budgeted appropriations at the fund level, any decisions that alter the total appropriations of any fund are to be approved by City Council. Projects budgeted within the fiscal year but not yet completed can be reappropriated the following fiscal year with City Manager approval. All other unencumbered appropriations lapse at year-end. Encumbered amounts are reappropriated in the ensuing fiscal year budget. i I ! OTHER REPORT MACIAS GINI ~ COMPANY,_,_,- 515 S. Flgueroa Street, Ste. 325 Los Angeles. California 90071 2 I 3.286.6400 PHONE 213.286.6426 FAX To the Board of Directors Kern Council of Governments Bakersfield, California To the City Council City of Bakersfield Bakersfield, California INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMNED IN ACCORDANCE XVITH GOVERNMENT AUDITING STANDARDS AND THE TRANSPORTATION DEVELOPMENT ACT We have audited the accompanying financial statements of the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund of the City of Bakersfield, California (City), as of and for the fiscal year ended June 30, 2005, and have issued our report thereon dated January 30, 2006, which included an ...e..xplanatory paragraph describing that the. financial statements only present the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and perfom'dng our audit, we considered the internal control over the City's financial reporting as it relates to the Bikexvay and Pedestrian Special Revenue Fund and the gantrak Operations Special Revenue Fund in order to determine our auditing procedures for the purpose of expressing our opinions on the financial statements and not to provide an opinion on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fi'aud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. www.maciasginl,com CERTIF'IED PUBLIC ACCOUNTANTS &, HANAGEHENT CONSULTANTS Compliance and Other Matters As part of obtaining reasonable assurance about whether the Bikeway and Pedestrian Special Revenue Fund and the Amtrak Operations Special Revenue Fund financial statemefxts are free of material misstatement, we performed tests of the City's compliance with certain provisions of laws, regulations, contracts and grant a~eements, noncompliance with which could have a direct and material effect on fhe determination of financial statement amounts. Our audit was further made to detexTnine that Transportation Development Act (TDA) funds allocated to and received by the City were expended in conformance with applicable statutes, rules and regulations of the TDA and the allocation instructions and resolutions of Kern Council of Governments as required by Section 6666 and 6667 of Title 21 of the California Code of Regulations. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards and the Transportation Development Act. This report is intended solely for the inforn~ation and use of the Kern Council of Governments, City management, City Council, and the State Controller's Office, and is not intended to be and should not be used by anyone other than these specified parties. Certified Public Accountants Los Angeles, California January 30, 2006 .... I I I ! 1 ! Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Consolidated Financial Statements Year Ended June 30, 2006 6) Longcrier Hooper &King_ CONTENTS Page(st lndependent Auditors' Report On The Consolidated Financial Statements 1 Management's Discussion and Analysis (Required Supplementary Information) 2 - 7 Consolidated Financial Statements Consolidated statement of net assets 8 Consolidated statement of revenues, expenses and changes in net assets 9 Consolidated statement of cash flows 10 Notes to consolidated Financial Statements 11 - 22, Independent Auditors' Report on the Supplementary Information 23. Supplementary Information Consolidated schedule of operating expenses 24 Independent Auditors' Report On Compliance And On Internal Control Over Financial Reporting Based On An Audit Of Financial Statements Performed In Accordance With Government Auditing Standards 25 O Lo.'er Accountancy ~orporalion Independent Auditors' Report SMG Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Bakersfield, California We have audited the consolidated statement of net assets of Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center as of June 30, 2006, and the related consolidated statements of revenues, expenses and changes in net assets, and cash flows for the year then ended. These consolidated financial statements are the responsibility of the City of Bakersfield's facility management company, SMG. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with U.S. generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as' evalUating the overall financial statement presentation. We believe that our audit provides a reasonable basis.for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center as of June 30, 2006, and the results of its operations and changes in net assets, and its cash flows for the year then ended in conformity with U.S. generally accepted accounting principles. t 5001 E. Commercenter Drive, Suite 350 100 Cross Street 1010 S. Broadway EO. Box 11171 Suite 103 Suite I Bakersfield, CA 93389 San Luis Obispo, CA 93401 Santa Maria, CA 93454 Phone: 661.631.1171 Phone: 805.541.2500 Phone: 805.349.7705 Fax: 661.631.0244 Fax: 805.541.4024 Fax: 805.349.7702 The Required Supplementary Information, as listed in the foregoing table of contents, is not a required part of the basic financial statements, but is supplementary information required by the Governmental Accounting Standards Board. The required supplementary 'information is the responsibility of the City's facility management company, SMG. This required supplementary information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly presented in all material respects when considered in relation to the basic financial statements taken as a whole. In accordance with Govemment Auditing Standards, we have also issued a report dated September 8, 2006 on our consideration of SMG's internal control over financial reporting and our assessment of its compliance with certain provisions of laws, regulations, contracts and grants. That rePort is an. integral part of an audit performed in accordance with Government Auditing Standards and should'be read in conjunction with this report in considering the results of our audit. Bakersfield, California SePtember 8, 2006 -1- Rab ?__koban ARENA JULY 2005 TO JUNE 2006 RABOBANK ARENA, THEATER, CONVENTION CENTER AND THE BAKERSFIELD ICE SPORTS CENTER MANAGEMENT DISCUSSION AND ANALYSIS ( This section of Rabobank Arena, Theater, Convention Center and the Bakersfield Ice Sports Center's annual financial report presents our discussion and analysis of the eomplex's financial performance during the fiscal year ended June 30,' 2006. Please read it in conjunction with the arena's financial statements, which follow this section. FINANCIAL HIGHLIGHTS · The 2005-2006 hockey season was the best year the Condors have had. They played a total of seven playoffgames, making this the furthest the team has gone in franchise history. With the on-ice success, it helped increase Arena revenues for the season by almost $87,000. · The California State CIF Wrestling Tournament returned for the third of a three year deal and proved that the first two year's success was no fluke as they were in our top five grossing events for the 05-06 fiscal year. The contract was up and was awarded to Rabobank Arena again for another three year run in Bakersfield. · The sUCcessful Broadway in Bakersfield theater series brought to Rabobank Theater by Jam Theatrical had a great first season here. The net profit from the series was above $134,000. With the success of the first year, they have just launched the second season. · The Arena had nine concerts and the Convention Center had one in this fiscal year for a combined net profit of over $377,000. In the 2006-2007 fiscal year we are expecting to have more concerts in the Arena and also in the Convention Center for an even greater success story. OVERVIEW OF THE FINANCIAL STATEMENTS The annual report includes this management's discussion and analysis report, the independent auditor's report and the basic financial statements of the arena. -2- REQUIRED FINANCIAL STATEMENTS The basic financial statements include a Statement of Net Assets, a Statement of Revenue, Expenses and Changes in Net Assets, and a Statement of Cash Flows. FINANCIAL ANALYSIS OF THE ARENA Below is a summary of the Arena's Statements of Net Assets, Table A-1: Table A-1 Statements of Net Assets June 30, June 30, $ % 2005 2006 Chan~le Chan~le ASSETS Cash $ 2,101,835 $ 2,136,428 $ 34,593 2% NR Other .62,588 377.413 314.825 503% A/R Trade 690.818 478,780 (212,038) -31% Prepaid Expanses 65,598 3,853 (61,745) -95% Equipment 88.269 98.266 9,997 12% Accumulated Depreciation. Equip (70,337) (83,194) (12~857) 19% TOTAL ASSETS $ 2,938,77t $ 3,0tl,546 $ 72,778 3% LIABILmE8 & NET ASSETS A/P Other $ 33,338 $ 128,847 $ 95,509 287% A/P Trade 124,213 95,024 (29.189) -24% Accrued Expenses 99,293 178,154 78,861 80% Deferred Revenue 2.698.453 2.298,932 (399.521) -15% Advance from Client 2.950.939 3.467,241 516.302 18% TOTAL LIABILITIES 5,906~236 6,168,198 261 ~962 4% NET ASSETS 12.967.465} (3,156,652) (189,i871 7% TOTAL LIABILITIES & NET ASSETS $ 2,938,771 $ 3,0tt,546 $ 72,775 3% -3- Upon first glance at the net assets for the fiscal year ended June 30, 2006 an increase of $72,775 versus the previous year is seen. Typically, and this year was no exception, the level of cash is determined mostly by the number of events on-sale at any given time. Accounts receivable, other, which includes receivables from both TicketMaster and Aramark, as well'as the Theater Season Renewal of season ticket holders, was up $314,825 which is, for the most part, a timing issue. Accounts receivable, trade decreased by $212,038 overall and is due to the timing of receipts paid to the Arena. $350,000 of accounts receivable, trade is made up of suite billings for the 06-07 suite year, which were technically due on the last day of the fiscal year. Prepaid expenses show a big decrease in its account balance, this is caused by our theater season that produced prepaid expenditures last year that have not oecun'ed this year. On the liability side of the Statement of Net Assets it is business as usual with the normal timing fluctuations in the accounts payable, trade account. The increase in accounts payable, other is made of up the incentive fee calculation for the management fee. With the successful year of both buildings, the incentive is much greater this year. -4- Table A-2 Statements of Revenues, Expenses and Changes in Net Assets Year ended June 30, 2005 2006 $ Chan~le % Chan~le Revenue Rent $1,197,339 $1,452,484 $ 255,145 22% Reimbursed Expenses 828,670 1,220,756 392,066 46% Suita Revenue 926,425 1,066,084 137,659 15% Food & Beverage Commission 442,997 644,166 201,169 46% · Signage Revenue 464,170 626,661 162,491 35% Parking Revenue 154,695 197,062 42,167 26% Ticket Rebate 126,267 232,493 106,206 64% Novelty Commission 34,496 54,540 20.044 59% Ice Sports Center, general admissions 104,174 202,506 98,332 95% Ice Sports Center, other revenue 522,533 500,487 -22,046 -5% Total Revenue 4~603,955 6, !97,239 1,393~253 29% Event Expenses Event Labor 866,652 1,068,900 192,248 23% Advertising Expense 147,600 297,678 1 50,078 102% Direct Event Expenses 144~732 270~450 125~718 87% Total Event Expenses 1,158,964 1.627,028 468,044 41% Total G&A Expenses 4,195,252 4,768,642 573,590 14% · Interest Income' 4,372 9,444 5,072 116% Change in Net Assets ~ $(189,187~ $ 356,691 Overall, revenue is up from the previous year. This is the third year for the Ice Sports Center and they have been continually growing each year and have had a very positive effect on the finaneials. The increase in the suite revenue is due to the higher rate on the suite renewal, unfortunately, this is the last series of renewals at the higher rates. This was the first full year of income on the naming rights deal, which had the positive effect on the signage revenue. All ancillaries are up from the previous year due to the significant increase in events. The direct event expenses were up due to the Theater Season. The increase is reflected in the increase in the reimbursed expenses. -5- The 2005/2006 fiscal year was a very successful year for both buildings. There was a significant turn around in the bottom line between the two years. The $545,878 loss in the 2004/2005 year was our second worst year to date, and the current year was our most successful year to date in the history of the building. Table A-3 Change in Net Assets Actual to Budget Year ended June ~30, 2006 Overl(Under) Actual Budl~lst Budget % of Budget Revenue Rent 1,452,464 1,286,268 166,216 113% Reimbursed Expenses 1,220,756 759,570 461,1 56 161% Suite Revenue 1,066,064 1,035,623 30,461 103% Food & Beverage Commission 644,166 487,730 156,436 132% $1gnage Revenue 626,661 560,244 66.417 112% Parking Revenue 197,062 212,750 (15,688) 93% Ticket Rebate 232,493 182,500 49,993 128% Novelty Commission 54,540 27,600 26,940 198% Ice Sports Center, general admissions 202,566 193,000 9,506 105% Ice Sports Center, other revenue 500,487 629,450 (128,963) 80% Total Revenue 6,197,239 5,374,735 822,594 116% Event Expenses Event Labor 1,058,900 1,227,128 (168,228) 87% Advertising Expense 297.678 39,000 258,678 764% Direct Event Expenses 270,450 23,800 246~650 1137% Total Event Expenses 1,627,028 1,289,928 337,100 127% Total G&A Expenses 4,768,542 4,260,551 508,291 112% Interest Income 9,444 600 8,844 1574% Change in Net Assets ~ ~ ~ t08% This year we were very close to meeting budget. The'only revenue accounts that missed budget were parking and Ice Sports Center, other revenue. The revenue was up 27% for the year for parking but was over estimated on the budget. Direct Event Expenses were over budget due to the Theater Season. -6- ECONOMIC FACTORS AND NEXT YEARS BUDGET AND RATES Several key factors affect next Year for the arena: ' · We have added an additional primary tenant for the 06/07 year. The Bakersfield Jam, an NBA D-League team, will play at least 24 home games in the Arena this year with possible playoff games during post season. · The City has provided the Arena with a $1.3 million ad ribbon. The addition of the state of the art ribbon will have a positive effect on the elements available and rates charged to the advertisers. · The concert calendar is looking positive this year; we currently have 14 concerts on the books in the first half of the 06/07 year. · With an increase of about 10% in the number of events for the 06/07 year, available dates are becoming hard to find for any new shows that are looking to book the Arena between October and April. · On September 13th, 2006, a law was passed that will increase minimum wage from $6.75 to $7.50 on January 1, 2007. This will have a great impact on direct event labor because most of the jobs in that category are paid at minimum or close to minimum wage. It will be possible to see an increase anywhere from $100,000 to $150,000, a portion of the increase may be able to be offset with increased billable rates. · As usual in this type of industry, the Arena is always subject to the desire of events touring and the publics' taste in entertainment. CONTACTING RABOBANK ARENA This financial report is designed to provide'a general overview of the finances and accountability of Rabobank Arena, Theater, Convention Center and the Bakersfield ice Sports Center. If you have questions about this report contact Rabobank Arena, Theater, Convention Center and the Bakersfield Ice Sports Center, 1001 Truxtun Avenue, Bakersfield, California 93301, Attention Director of Finance. -7- Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Consolidated Statement of Net Assets June 30, 2006 ASSETS Current Assets Cash $ 2,136,428 Accounts receivable, trade 478,780 Accounts receivable, other 377,413 Prepaid expenses 3,853 2,996,474 Property and Equipment, at cost 98,266 Less accumulated depreciation (83,194) 15,072 LIABILITIES AND NET ASSETS Current Liabilities Accounts payable, trade $ 95,024 Accounts payable, other 128,847 Accrued expenses 178,154 Deferred revenue 2,298,932 Advance from City of Bakersfield 3,467,241 6,168,198 Commitments Net Assets Invested in capitalassets 15,072 Unrestricted o (3,171,724) (3,156,652) $ 3,011,546 See Notes to Consolidated Financial Statements. -8- Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Consolidated Statement of Revenues, Expenses and Changes in Net Assets For the Year Ended June 30, 2006 Net revenues: Facilities rent $ 1,452,484 Event expense reimbursements 1,220,756 Suite and premium seats 1,066,084 Concession commission 644,166 Signage and advertising 626,661 Parking 197,062 Ticketing fees 232,493 Merchandise 54,540 Ice Sports Center, general admissions 202,506 Ice Sports Center, other revenue 500,487 6,197,239 Direct event expenses: Event labor 1,058,900 Event advertising 297,678 Other direct event expenses 270,450 1,627,028 Gross profit 4,570,211 Operating expenses 4,768,842 Operating loss ' (198,631) Nonoperating income: Interest income 9,444 Change in net assets (189,187) Total net assets, beginning (2,967,465} Total net assets, ending $ (3,156,652) See Notes to Consolidated Financial Statements. · -9- Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Consolidated Statement of Cash Flows For the Year Ended June 30, 2006 Cash fiows from operating activities: Cash received from customers $ 2,224,284 Cash received from contracts for services 3,522,867 Cash payments to suppliers for goods & services (3,194,155) Cash payments to employees for services (3,034,152) Net cash used in operating activities (481,156) Cash fiows from capital and related financing activities: Acquisition of capital assets (9,997) Net increase in advances from the City of Bakersfield 516,302 Net cash provided by Capital and related financing activities 506,305 Cash fiows from investing activities: Interest income 9,444 Net increase in cash and cash equivalents. 34,593 Cash and cash equivalents, beginning 2,101,835 Cash and cash equivalents, ending $ 2,136,428 See Notes to Financial Consolidated Statements. Reconciliation of operating loss to net cash used in operating activities: Operating loss $ (198,631) ~4djustments to reconcile operating loss to net cash used in operating activities: Depreciation 12,857 Increase inaccounts receivable (102,787) Decrease in prepaid expenses 61,745 Increase in accounts payable 66,320 Increase in accrued expenses 78,861 Decrease in deferred revenue Net cash used in operating activities $ (481,156) -10- Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Notes to Consolidated Financial Statements Note 1. Nature of Business and Significant Accounting Policies Nature of Business: The City of Bakersfield (the City) owns the Rabobank Arena, Theater and Convention Center (the Facilities). The Facilities were previously known as the Bakersfield Centennial Garden and Convention Center. The Rabobank Arena was built by the City, and began operations in October 1998. It is the only building of its kind in the Bakersfield area. On August 6, 1997, the City issued a request for proposals for services prior to the opening of the Rabobank Arena and the operation and management of the Facilities thereafter. In an agreement dated January 28, 1998, the City Contracted with Ogden Entertainment, Inc. (Ogden) for these services for an initial period of five years. The contract term was subsequently extended for an additional five-year term and the agreement is effective thrOugh June 30, 2008. Ogden worked during the January 14, 1998 through June 30, 1998 pre-opening phase and assumed management responsibilities of the Facilities on July 1, 1998. Ogden was hired by the City for its expertise in the management, operation and marketing' of public assembly facilities.. Ogden sold its entertainment business division to ARAMAR~ Corporation effective June 2, 2000. The operation of the Facilities are still being conducted under Ogden's name. All contracts and leases, with the exception of the administrative services agreement with the City, are transferable to ARAMARK Corporation. The City approved the transfer of the administrative services agreement to ARA.MARK Corporation. On September 13, 2000, ARAMARK sold and assigned all of its rights, obligations, liabilities and indenmities as manager of the Facilities to SMG (the Company) for $1 SMG is owned by a partnership that includes ARAMARK and Hyatt. All contracts and leases, with the exception of the administrative service agreement with the City, are transferable to the Company. The City has approved'the transfer of the administrative services agreements to the Company. See Note 4 for terms of the administrative service agreement. -11- Notes to Consolidated Financial Statements In December 2004, the City opened the Bakersfield Ice Sports Center (Ice Center). The Ice Center is used for public skating, hockey leagues, figure skating, and other community events. In an agreement dated November 5, 2003, the City contracted with the Company for the management, concession and catering services for the Ice Center through June 30, 2008. The activities of the Facilities and the Ice Center are recorded in a special revenue fund of the City's accounting records. The City owns all the assets of the Facilities, and the Ice Center and accordingly, all amounts related to the operation of the Facilities and the Ice Center belong to the City. The Company has a fiduciary responsibility under the management agreement to maintain and operate the Facilities and the Ice Center in the best interests of the City and the community. Fund accounting: The focus of proprietary fund measurement is upon determination of operating income, change in net assets, financial position, and cash flows. The U.S. generally accepted accounting principles applicable are those similar to businesses in the private sector. Enterprise funds are required to be used to account for operations for which a fee is charged to external users for goods or services and the activity (a) is financed with debt that is solely secured by a pledge of the net revenues, (b) has third party requirements that the cost of providing services, including capital costs, be recOvered with fees and charges or (c) establishes fees and charges based on a pricing policy designed to recover similar costs. Operating income reported in proprietary fund financial statements includes revenues and expenses related to the primary, continuing operations of the fund. Principal operating revenues for proprietary funds are charges to customers for sales or services. Principal operating expenses are the costs of providing goods or services and include administrative expenses and depreciation of capital assets. Other revenues and expenses are classified as nonoperating in the financial statements. Notes to Consolidated Financial Statements Revenue recognition: Suite and premium seat contracts Revenues from suite and premium seat c~ntracts are recognized over the contract period per the contract terms. Contracts are billed twice a year with the entire contract amount payable prior to the contract period. The suite and premium seat payments are recorded as deferred revenue until earned and recognized over the contract period. Naming rights, signage and advertising contracts Revenues from naming rights, signage and advertising contracts are recognized over the contract period per the contract terms. Contracts are billed according to the contract terms. Payments are recorded as deferred revenue until earned and recognized over the contract period. Ticket sales The Facilities, through its contract with Ticketmaster, sells tickets to events (at the Facilities) as an agent of the event holder at the on site box office locatiOn and through telephone, internet and outlet'locations. All revenues from the sale of tickets belong to the event holder. The ticket sales are recorded as deferred revenue when sold. After the event has occurred, settlement with the event holder takes place. The net of total ticket sales less event expenses such as facility rent and reimbursement of direct event expenses is then paid to or received from the event holder. The event ticket revenues are removed from the deferred revenue account at the time of settlement. The Facilities earn a ticketing fee on the sale of event tickets that take place through telephone, internet and outlet locations. Revenues from these'fees are recorded as deferred revenue at the time of sale and are recognized at the time of event settlement. Event revenues Revenues from the Facilities' events such as facilities rent, direct event expense reimbursements, concession commissions, parking and merchandise are recognized at the time of event settlement. -13- Notes to Consolidated Financial Statements Basis of accounting: The accompanying financial statements have been prepared on the accrual basis of accounting. Under the accrual basis, revenues are recognized when earned and expenses are recognized when incurred. Financial reporting: On July 1, 2002, the Facilities adopted the provisions of Governmental Accounting Standards Board Statement No. 34, "Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments." Statement No. 34 established standards for external financial reporting for all state and local governmental entities, which includes a statement of net assets, a statement of activities and changes in net assets, and a statement of cash flows. It requires the classification of net assets into three components - invested in capital assets, net of related debt; restricted; and unrestricted. These classifications are defined as follows: Invested in capital assets, net of related debt -:This component of net assets consists of capital assets, including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. If there are significant unspent related debt proceeds at year-end, the portion of the debt attributable to the unspent proceeds are not included in the calculation of invested in capital assets, net of related debt. Rather, that portion of the debt is included in the same net assets component as the unspent proceeds. Restricted net assets - This component of net assets consists of constraints placed on net asset use through extemal constraints imposed by creditors (such as,through debt covenants), grantors, contributors, or laws or regulations of other governments or constraints imposed by law through constitutional provisions or enabling legislation. Unrestricted net assets - This component of net assets consists of net assets that do not meet the definition of"restrieted net assets" or "invested in capital assets, net of related debt." The adoption of Statement No. 34 affected the classification of net assets in accordance with the statement and the presentation of capital contributions as a change in net assets. - 14- Notes to Consolidated Financial Statements Use of estimates: The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ fl~om those estimates. Cash and cash equivalents: For purposes of reporting cash flows, cash and cash equivalents include cash on hand and amounts deposited with banks. Categories of deposit risk: In accordance with the Governmental Accounting Standard Board Statement No. 40, the City's deposits at June 30, 2006 are described as follows: Carrying Market Value Value Cash and cash equivalents $ 2,136,428 $ 2,136,428 At June 30, 2006, the carrying amount of financial institution deposits was $2,136,428 and the bank balance was $2,335,734 of which only $100,000 is covered by federal depository insurance. Concentration of credit risk: Credit is extended,,in the form of accounts receivable, to customers located primarily in California. Advertising: The Company expenses advertising costs as they are incurred. Advertising expense was. $297,678 at June 30, 2006. -15- Notes to Consolidated Financial Statements Trade accounts receivable: Trade accounts receivable are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a charge to earnings and a credit to valuation allowance based on its assessments of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance' and a credit to trade accounts receivable. Changes in the valuation allowance have not been material to the financial statements. Property and equipment: Property and equipment are recorded at cost. Depreciation is comPuted using the straight line method over estimated useful lives of 3 - 5 years. Maintenance and repairs of property and equipment are charged to operations and major improvements are capitalized. Upon retirement, sale or other disposition of property and equipment, the cost and accumulated depreciation are eliminated from the accounts and gain or loss is included in the statement of. revenues and expenses. Note 2. Deferred Revenue Deferred revenue at June 30, 2006 consists of the follOwing: Suite Contracts $ 928,122 Advertising contracts 484,787 Ticket sales, future events 811,497 Event deposits 55,910 Ticket rebates 9,662 Ice Sports Center 8,954 Notes to Consolidated Financial Statements Note 3. 'Advance From City of Bakersfield During the normal course of business, the City pays expenses that are allocated to the operation of the Facilities. These expenses include payroll and related expenses for the City employees and rent and utilities for the office space used by the Company. The amount of the advance fluctuates throughout the year depending on allocated monthly expenses and additional Cash flow needs. The advance is an inter-company account that is eliminated in the consolidation for the preparation of the Ci~s financial statements. The amount due at June 30, 2006 was $3,467,241. Note 4. ~ldministrative Services ~tgreement ' The Company provides administrative services for the City for the Facilities under an original five-year agreement, which was subsequently extended for an additional five- year period. Compensation for these services is a base fee of $150,000 for the first year, paid in equal monthly installments. The base fee increases by 3% Per year and each year thereafter until the agreement has terminated. In addition to the base fee, the Company receives an incentive relative to the amount of the reduction, if any, in net operating loss for each fiscal year. The incentive is calculated based upon the net operating income or loss after the base fee. The Comply receives an incentive of: l) 10% of the first $350,000 in net operating loss reduced; 2) 20% of the next $500,000 in net operating loss reduced; 3) 30% of any net operating surplus in any one fiscal year. All of the incentive calculations are based upon a projected annual net operating loss of $850,000. Beginning July l, 2003, in addition to the above amounts, the Company will receive an incentive amount of $25,000 for every year the net operating loss before incentive is below $300,000. If the net operating surplus in any fiscal year reaches $350,000, then the incentive fee will cease. The Company provides administrative, concession and catering services for the City for the Ice Center under an original agreement effective December 13, 2003 through June 30, 2008. The annual management fee is $48,000, plus 20% net operating income of the Ice Center over $100,000, of which the Company receives 50%. Ieeoplex, the ice rink operations co-manager, receives the other 50%. For the year ended June 30, 2006, the Company received $366,881 in management and incentive fees. -17- NOtes to Consolidated Financial Statements The computation of the incentive fee is based upon the books and records of the Facilities maintained by the Compfiny. The accounting records for the Facilities must be maintained in accordance with U.S. generally accepted accounting principles and industry standards. The Company is required under' the agreement with the City to have an annual audit at the end of the fiscal year. Under the management agreement with the City, the CompanY has the fight to operate or contract with others to operate concession and catering services for the Facilities during the initial five-year term of the contract, effective through June 30, 2003. The City is currently operating under a contract with ARAMARK to operate these services, effective through June 30, 2008. The Facility (Rabobank Arena) is entitled to receive 35% of the first $600,000 in gross concession receipts from the Rabobank Arena and 40% of receipts in excess of $600,000 and 15% of gross concession receipts to the suites. For the year ended June 30, 2006, the Facility received $641,818 in gross concession and catering receipts from the Food and Beverage division of the Rabobank Arena. The Facility is entitled to receive 75% of the net novelty receipts of the Rabobank Arena and the Company receives the remaining 25%. For the year ended June 30, 2006 the Facility received $53,167 and the Company received $17,722 in net novelty receipts from the Food and Beverage division of the Rabobank Arena. As of July 21, 2004, an amended agreement was made between the City and ARAMARK to transfer concession and alcohol responsibilities to ARAMARK for the Rabobank Convention Center, in addition to the Rabobank Arena. The division of the net novelty receipts remains the same under the new agreements (75% to the Facilities, 25% to the Company). For concession sales, the Facility is entitled to receive 30% of the gross concession receipts in the Convention Center and ARAMARK receives 70%. The same division of gross concession receipts applies to the alcohol sales in the Convention Center. The Company does not receive a percentage of food, beverage or alcohol sales. The Company also pays the City for equipment rentals. At June 30, 2006, the Company paid $186,895 for equipment rentals. -18- Notes to Consolidated Financial Statements Note 5. Commitments The Facilities have entered into various long-term c°ntracts and leases. At June 30, 2006, outstanding commitments consist of the following: Ticket sales The Facilities have entered into a licensed user agreement with Ticketmaster to be the exclusive provider for ticket sales for any event presented at the Facilities. Under the agreement, Ticketmaster has the authority to act as an agent for the Facilities for ticket sales to the general public by any and all means including telephone, interact, and outlet locations. Ticketmaster earns fees from the ticket sales such as inside ticket charges, customer convenience charges, credit card charges, handling charges and ticket sale royalties. Some fees are subject to increases throughout the contract term. Ticketmaster collects these fees as tickets are sold and the net amount is remitted to the Facilities weekly. The initial term of the agreement is for five years and the agreement is effective through August 31, 2009. The contract automatically renews for one two- year period unless terminated in accordance with the provisions of the contract. Hockey lease The City has entered into a lease agreement, which has been assigned t° Flying Puck, Inc. for exclusive use of the Facilities for East Coast Hockey League (ECHL) games. Flying Puck, Inc. has agreed to pay a minimum of $160,000 per season for use of the Facilities. As of June 30, 2006, the $160,000 consists of lease fees of $6,150 per game played plus 7.5% of ticket sales above certain levels per year, which increase over the contract term. The lease fees are subject to increase beginning in the third year of the contract and every two years thereafter based upon the Consumer Price Index adjustments. Flying Puck, Inc. receives $5,000 for each suite leased for hockey tickets. For the year ended June 30, 2006, Flying Puck, Inc. received $142,000 for the twenty-four suites leased. The agreement is effective through June 30, 2011 or ten days following the date the last ECHL playoff game of2011 is played, whichever occurs fu'st unless terminated earlier in accordance with the provisions of the agreement. The contract has one option for a renewal term of seven years. -19- Notes to Consolidated Financial Statements Basketball lease The Facilities have entered into a lease agreement with the Cal State University Bakersfield Foundation (Cal State) for exclusive use of the Facilities for Cai State University Bakersfield men's and women's basketball games. As of June 30, 2006, a lease fee of $4,120 per game plus 7.5% of ticket sales above certain levels is charged for use of the Facilities. Cai State receives $2,500 for each suite leased that includes basketball tickets. For the year ended June 30, 2006, Cal State received $60,000 for suite ticket options. Cal State exercised its option to renew the lease agreement on February 8, 2006 for five years through June 30, 2011. Arena Football lease On November 9, 2005 the Facilities entered into a new lease agreement with Bakersfield Arena Football, LLC (Bakersfield Blitz) for exclusive use of the Facilities for Bakersfield Blitz arena football games. For the season operating during April 2006 through June 2006, the Blitz paid $3,500 per game plus 10% of concessions. Bakersfield Blitz receives 10% of gross concession sales, excluding suite and catering sales, when actual drop count is 3,500 or more. For the year ended June 30, 2006, Bakersfield Blitz received $41,165 for concession sales. Bakersfield Blitz is also entitled to all revenue generated fi:om advertising sales within the Arena, including: dasherboards, program sales, and temporary signage. Bakersfield Blitz is resp~)nsible for selling 100% of video advertising for the scoreboard. The Facilities will receive 10 video spots to use on event day. The agreement is effective through the last game of the 2008 Arena Football season, and shall be for all regular season professional indoor football home games each year plus playoff and tournament games and practice time. - 20 - Notes to Consolidated Financial Statements Professional Basketball. On January 29, 2006 the Facilities entered into a lease agreement with Bakersfield Professional Sports, LLC for exclusive use of the Facilities fo? the Bakersfield Jam Professional Basketball team. The Bakersfield Jam will pay $4,750 per game plus 7.5% of gate receipts net of applicable taxes above $46,000. The $46,000 shall increase by $2,000 every other year starting in July 2007. The minimum payment per season is $108,000. Bakersfield Jam is also entitled to all revenue generated fi.om advertising sales within the court, including program sales, on the basketball court and hoops, and temporary concourse signage. The Bakersfield Jam may also use video advertising on the scoreboard, so long as advertising does not conflict with the Facilities exclusive advertisers. The Facilities will receive 10 video spots to use on event daY. This agreement is effective through June 30, 2011, and shall be for all preseason and regular season professional basketball home games each year plus playoff and practice time. Ice Sports Center As a result of the Ice Sports Center opening, the Company along with the City, entered into various contracts. At June 30, 2006 outstanding commitments consist of the following: Pro ShOp agreement The City and the Company have entered into a license agreement with Action Sports which grants Action Sports sole and exclusive right to operate the retail business at the Ice Center. Action Sports has the exclusive right to display and sell sporting goods, apparel and products, including but not limited to hockey goods and apparel, swimming goods and apparel and sports performance and nutritional supplements. For the use of the premises, Action Sports is to pay according to a fixed rental schedule which began January 15, 2004. The annual rent is based on $.85 per square foot for years one and two, and $.90 per square foot for year three. For years one and two annual rent is $9,894 ($824.50/month) and for year three $10,476 ($873/month). The agreement is effective through June 30, 2006. On August 31, 2006 the City and the Company renewed their contract through August 31, 2009. Action Sports may exercise two options to renew for terms of three years each at a square foot increase rate not to exceed $0.5 per square foot per year. -21 - Notes to Consolidated Financial Statements Concession and catering services The City and Company have entered into an agreement with ESC Enterprises (ESC) to provide concession and catering services for the Ice Center. According to the agreement, the Company shall receive 15% of gross concession receipts in year one and 20% of gross concession receipts in years two through five. The Company shall also receive 10% of sales on all vending machines. The agreement is effective through June 30, 2008, and can be renewed for one additional term of five years, upon terms satisfactory to the Company, the City and ESC. For the year ended June 30, 2006, the City received $26,154 in concession commissions from ESC. - 22 - O Lg__ er · H per · ~ccountancy Corporation Independent Auditors' Report on the Supplementa~ Information Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Bakersfield, California For the year ended June 30, 2006, the accompanying information shown on page 24 is presented only for purposes of additional analysis and is not a required part of the basic financial statements. Our audit of the basic financial statements was made for the purpose of forming an opinion on those statements taken as a whole. The accompanying information has been subjected to the procedures applied in the audit of the basic financial statements. In our opinion, the accompanying information is fairly stated in all material respects in relation to the basic financial statements taken as a whole. Bakersfield, California September 8, 2006 - 23 - 5001 E. Commercenter Drive, Suite 550 100 Cross Street 1010 S. Broadway P.O. Box 11171 Suite 103 ' Suite I Bakersfield, CA 93389 San Luis Obispo, CA 93401 Santa Maria, CA 93454 Phone: 661.631.1171 Phone: 805.541.2500 Phone: 805.349.7705 F~ 661.631.02~4 Fax: 805.541.4024 Fax: 805.349.7702 Rab obank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Consolidated Schedule of Operating Expenses For the Year Ended June 30, 2006 Full time staff $ 1,772,868 Utilities' 969,285 Insurance 541,002 Management fees 359,328 Part time staff 202,385 ' Equipment rental 186,895 Supplies 179,479 Hockey premium 142,000 Credit card fees 88,762 Security 60,904 Marketing 57,581 Professional fees 44,022 Telephone 31,811 Repairs and maintenance 30,894 Travel 30,298 Office supplies 20,635 Depreciation 12,857 Bad debt expense 9,527 Postage 8,150 Miscellaneous 5,154 Printing 3,848 Employment ad fees 3,844 Uniforms 3,839 Dues and subscriptions 3,474 - 24 - O ~ccoun~nc~ Independent Auditors' Report on Compliance and on Internal Control Over Financial Reportin~ Based on an/ludit oJr Financial St.n_tement~ Performed in ~lccordance with Government ~4~_~_di!ing Stan4ards SMG Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center Bakersfield, California We have audited the consolidated financial statements of Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center as of and for the year ended June 30, 2006, and have issued our report thereon dated September 8, 2006. We conducted our audit in accordance with U.S. generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Compliance Compliance with laws, regulations, contracts and grants applicable to Rabobank Arena, Theater, Convention Center & The Bakersfield Ice Sports Center is the responsibility of the City's facility management company, SMG. As part of our audit, we assessed the risk that noncompliance with certain provisions of laws, regulations, contracts and grants could cause the financial statements to be materially misstated: We concluded that the risk of such material misstatement was sufficiently low and that it was not necessary to perform tests of SMG's compliance with such provisions of laws, regulations, contracts and grants. 5001 E. Commercenter Drive, Suite 350 100 Cross Street 1010 S. Broadway P.O. Box 11171 Suite 103 Suite I Bakersfield, CA 93389 San Luis Obispo, CA 93401 Santa Maria, CA 93454 Phone: 661.631.1171 Phone: 805.541.2500 Phone: 805.349.7705 Fax: 661.631.0244 Fax: 805.541.4024 lax: 805.349.7702 Internal Control Over Financial Reporting In planning and performing our audit, we considered SMG's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion'on the financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting Would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. This report is intended solely for the information and use of management, others within the organization and the City of Bakersfield and is not intended to be and should not be used by anyone other than these specified parties. Bakersfield, California September 8, 2006 o 25 - TUESDAY, JUNE 20,' 2006 Cities ShoP FOr Lower PriCes In Wi-Fi: Free W HEN MobilePro Corp., a provider of The-breakup between Sacramento and Mo- wireless networks for municipalities, bilePro presages a shake-up in the nascent munici- 'won a contract from the city of Sacra- pal wireless market. 'While municipal ~reless ser- mento, Calif, last year to build' and operate a vice~s are just a few years old,-providers of the citywide wireless network,' the firm thought it had networks.:which often use a wireless technology · .landed its biggest deal ever. dubld~d Wi'~Fi-have mostly relied on subscription Under the agreement, Sacramento res[dents fees from users for revenue. Now the rise of a new would pay monthly subscription fees of. about $20 . municipal Wi-Fi business model dependent on to use MobilePro's wireless service, local busi- ·Web advertising is putting the first wave of munici- nesses Would pay $90 to $250, and Sacramento's · pal wireless providers~-such as MobilePro, Tro- city agencies would be able .to use the service free. pos Networks Inc. and Strix Systems Inc.-at risk. The agreement resembled that of many other mu-~ There are more than 250 cities in the U.S. that nicipal wireless deals across the country. For Mo- have deployed or are planning to deploy citYWid~ bilePr0, based.in Bethesda, Md., a full Year of municipal Wi:FL The municipal wireless market service' would bring in $2 million to $4 million in ' is expected to expand to $512 million by 2010 revenue, analysts estimate, from $88 million this year, says Godfrey Chua, a 'But earlier this month, the deal fell'apart, The wireless analyst with research' firm IDC. He reason: Sacramento city officials had noticed new notes that most of the current deployments-in municipal wireless deals inked in San Francisco cities such as Philadelphia, Anaheim; Calif., and and Portland, Ore. The Portland rollout, spon- Chaska, Minn:-use a subscriber-based business sored by SiliCon Valley startup MetroFi Inc., and model such as the one MobilePro offered Sacra- the San Francisco deployment from Google Inc. mento. and Eartlilink Inck, both offered wireless service' Sacramento .city! officials say they make no to those cities with ex- apologies in asking for a free wireless network panded free access for "~:::,:~i~:..:;:~ . Please Turn to Page B3, Column I. some businesses and gle and Earthlink planned'to make money their w~reless serxqce. less service supported city wanted was out of :.:.::~.' ii'::' the question,' says Jay Wright, MobiiePro's chief executive officer, · . . : JUNE 2'0,'.2006 ~.~ · .. ..: ~ '~ , , . ..~c ..... : ' ~ .... . : · ' 'i ~:',., i'.'. '." · .' ". · . . ..: · . Municipalities 'Shop for Free, Ad- Supported'Wi-Fi Networks . Continued From Page BI: nies. MetroFi declined to detail its reve- final phase of negotiatiohs, ramento, MobilePro concluded the reVe- suppOrted only by advertising. Th~ city's nue or say whether.it is profitable. For MobilePro, a five-year-old com-. nUe wouldn't be enough to cOver upgrade first priority "is .to taxpayers and that MetroFi has since won other munici- pany that generated $46 million in reve- and .maintenance costs. money has to be Spent wisely," says Jim pal wireless deals. In Portland, Ore,, nue last year, the rise of the advertising- On June 9, MobilePro and Sacra- manager Metr0Fi is awaiting city council based wireless service spells particularly mento decided to call it quits. Mr. Rine- Rinehartl citywide for where economic development for Sacramento.. approval for the wireless network, tesS- 'bad news. The company was an early, hart says the city will now start the pro- '~As time goes on, more cities will view dents will be able' to' choose between a provider of municipal wi-Fi service with Cess over again, putting out a request'for this issue as we see it" and go for an subscriber-based or an advertising-based a subscription-based business model. It a neWwireless network over the next few advertising-sponsored municiPal' Wi-Fi . wireless service. Residentslwhowant the - has Contracts in eight cities, including months. Metr0Fi's-Mr. Haas said he is service, he adds. · 'advertS'sing-based service will see a half~. Tempe, Ariz., Kansas City, Mo., and interested in Sacramento and would bid, That is music to the ears of municiPal inch wide advertising banner 'in their ' Beaumont, Texas. wireless prOviders that are alreadY push- browSer. For the.'se..rvice .without ads, So whefi it won the Sacramento deal..whenever a request 'for proposals is of- fered by the city. ingan advertising-based business model. Portland. residents will' .pay $19.95 a last year after, months, of negotiations MetroFi, based in MOuntain View, Calif., month. The company says there is no and after beating out AT&T Corp. and switched from offering a sUbscription;: '.difference in 'download speeds between Motorola Inc., MobilePro offered the only' service to. also offering an'advertis- MetroFi's subscriPtion and advertising- same subscription-based service model it lng-based service last year in the Silicon' based wireless services, had offered .in the past. In 'April Mo- Valley town of sUnnYVale,. Calif. MetroFi ' Portland's chief technology officer, bilePro set up a pilot wireIess project for CEO Chuck Haas says.the comPany made Matthew Lampe~ says the citY picked the city. . the switch to cut .the~ cost of' acquiring MetroFi~s proposal because it offered · But Soon after the pilot project in new. subscribers. While it costs about, more Wireless .access tO city .residents April, Sacramento sprang its request for $200 to acquire a new subscriber,'a free than other proposals. "We Wanted some- an advertising-supported wireless net- service attracts more subscribers, more thing ambitious,, Mr. Lampe says. work on MobilePro. While neither Mo- quickly. Today, there are about 10,000 con- In San Francisco, Google and'Earth. bilePro nor Sacramento' had signed an sumers using MetroFi's service in. Sunny- .~ linkteamed up'to offer'a wireless service' aitual contract~ MobilePro CEO Mr. vale, and in the neighboring cities of that also gives cOnSumers the ch0iie'of a Wright says he' considered, that just a Santa Clara and.Cupertino. 'Nearly 80% of SUbscription-based plan or a free adver- formality. Sacr/mento officials, however, the users came on board after the switch rising-based, service~ Chris.. Sacca, Goo- saw things' another~way.' "We had two- to the free model supported by advertis- gle's head of special initiatives, says the thirds of the zipper closed, but in our Lng, the company says. companies concluded the Wireless ser- eyes negotiations were not finalized,". MetroFi says it has focused on attract- vice couldn't solely be sustained by adver- says Sacramento's Mr. Rinehart.' lng a mix of local, regional and national . rising and also neededsubscription fees. . MobilePro attempted to' accommodate advertisers to support its wireless' Set- Users of the free adVertising-based ser-. Sacramento's new demands. But Mr. vice. Thus far, the Company has !anded .vice, hoWever~ will get slower ,speeds . Wright concluded his company would ad deals w/th regional DaimlerChrysler than paying subscribers. The free ser- make just $2 a month per user with the AG car dealerships~ the Holiday Inn and . vice will be faster than dial-up but sloWer advertising model, instead of the $20 to a local tax-preparation company. The. pri- than most broadband. Connections. Mr. $250 a month per user that it would get vately held company is also'in talks with Sacca and an Earthlink spokesman say from subscription fees. With network com a handful of national' advertising compa- the plans for San Francisco are in the struction costs at about $8 million for Sac-' B A K E R S F I E L D CITY MANAGERS OFFICE MEMORANDUM June 15, 2006 TO: Budget & Finance Committee' FROM: Alan Christensen, Assistant City Manager ~ SUBJECT: Company Inquiry to Provide Wireless Internet Access City staff received a proposal from a company named MetroFi that is requesting to lease City light poles in order to provide wireless internet service throughout Bakersfield. They are requesting something very similar to the franchise agreements that the City has with phone, gas, electric, and cable companies. MetroFi estimates that about 200 light poles are needed to mount radio transmission equipment to provide the service city wide. MetroFi proposes wireless interact service or"WiFi" at no cost to local customers. The cost Of the . service is paid for with local advertising on content pages. They also offer an option for service without advertising for about $20 per month. Speeds are similar but not quite as fast as cable modem or DSL. This product is ideal for City residents that cannot afford intemet service. MetroFI already operates in several California cities: Santa Clara, Cupertino, Foster City, Sunnyvale, Mountain View and San Francisco. They have agreements signed with Portland, Oregon, and Aurora, Illinois. Other communities across the country use the same technology. There is no cost to the City. Rather, the company offers to pay the City'lease payments of $36 per light pole. The lease revenue is estimated to be between $180,000 and $200,000 if enough poles were used to offer the service city wide. MetroFi has also offered to provide their wireless network for free to the City where now we currently pay for T-1 phone lines to remote sites such as Fire Stations. Their network could also be used for surveillance in graffiti and code enforcement. Attached are two pictures of MetroFI radio antennas mounted on light poles in other communities. Also attached are professional articles describing how local governments are allowing private companies to offer WiFi service in their communities at little or no cost and the savings generated by the technology. Staff believes the WiFi program proposed by MetroFi is a good one and worthy of study and consideration by the City of Bakersfield. January 24, 2006 Citywide Wireless Broadband MetroFi Overview/Proposal MetroFi is pleased to provide an overview to the City of Bakersfield. Our company has three years of experience designing, building and operating community Wi-Fi networks in the San Francisco Bay Area. MetroFi is unique in that we have an operational network covering cities in the Bay area at this time. We have negotiated agreements with the local power company (PG&E) for un-metered power and with other San Francisco Bay Area Cities for Pole Attachment, developed best practices for deployment and network management tools for citywide Wi-Fi service and have 1000's of wireless broadband customers. We have validated performance in the "real world" of large scale deployment. The result is a quality, state-of-the-art solution which is high-speed, Iow-cost and highly reliable and what we bring to the City of Bakersfield is a proven track record. Overview MetroFi's proposal delivers a visionary approach. We will build the network at no cost to the City of Bakersfield and wireless broadband will be available at no cost to residents and visitors. Our experience is our foundation and we have demonstrated the ability, to work with various cities by deploying five San Francisco Bay Area networks. The IVletroFi solution can stimulate the local economy by making affordable and portable broadband available to every citizen and visitor to the City. The City of Bakersfield, residents and visitors will benefit from choice and competition in the broadband marketplace. Low-income households and non-profit agencies can access the Internet at no cost. This removes the #1 barrier to broadband penetration in the US - Affordability. Families without credit cards can access the service as we will require no credit reports, and no credit cards. The service will be easy to use - just access the IqetroFi - FREE SSID with a standard Wi-Fi device and you enjoy 1Mbps high speed Internet. Local non-profit agencies can marry MetroFi Wi-Fi access to training programs and affordable computers. No child or adult needs to be without high speed access to the information and opportunities afforded through the Internet. The City can also save on its existing telecommunications bills by leveraging the pre- WiMAX services created by the MetroFi service. Better government will be enabled by making city workers as productive outside the .office as they are when connected to broadband at their desks. Our proposed solution is a replica of our existing architecture and design. Our PROVEN deployment model and end-to-end solution will ensure a fast and successful deployment for the City of Bakersfield. We are well funded with top-tier Silicon Valley Venture backing from August Capital and Sevin Rosen Funds. We believe no other company has our track record in deploying a City-wide Community Wireless Broadband Network. Designing, Building and Operating this network requires Copyright MetroFi, Inc. 2 MetroFi Overview/Proposal real world experience in managing RF coverage, interference, end-to-end architecture, and customer service. Experience matters and MetroFi offers a Iow-risk solution in achieving the City of Bakersfield's goals and objectives. By working with MetroFi, the City of Bakersfield leverages this financial and operational knowledge. The key aspects of partnering with MetroFi are outlined below: Affordable/Free MetroFi will offer FREE advertiser supported Internet throughout the city. Most of Bakersfield will be within 100's of feet of Free WT-F[ Internet access. This will be a great benefit to visitors to the City and an economic driver for the residents. MetroFi proposes a full speed, 1Mbps service, not a slow-speed almost broadband. Residents may subscribe to the MetroFi $19.95 service or one of our wholesale Service Provider services if they want ad-free, unlimited service. Experience MetroFi is staffed by communications industry veterans who know what it takes to deliver carrier class networks capable of scaling to 100,000's of customers. MetroFi is the leader in designing, building and operating municipal Wi-Fi networks. State-of-the-Art MetroFi's network delivers high performance and scalability using high-powered 2nd Generation Mesh radio architecture. MulU-Use A single network can serve government, business and consumer customers for voice, data and video. Government and emergency services can be prioritized. Business services will be provisioned over a state-of-the-art pre-WiMAX mesh layer, delivering industry leading price/performance over existing options. Consumer Tnternet will be fast, reliable and portable. Ubiquitous MetroFi will blanket the city with 1Mbps wireless broadband service for consumer, business and government use. Open Access MetroFi is founded on the principle of an open access model. The MetroFi network Can support ISP's who may wish to offer services to the City of Bakersfield. Secure MetroFi encourages all residential, government and business customers to use industry standard WPA/802.1x security. MetroFi is the first company implementing security in a production municipal network. Reliable The MetroFi network operates with high reliability, with 99.5-99.9% availability. Scope of Work MetroFi will provide wireless broadband where possible throughout Bakersfield. We will complete the entire city within 12 months of signing contracts with the city Copyright MetroFi, Inc. 3 MetroFi Overview/Proposal Network _Our state-of-the-art network architecture is comprised of two tiers, a pre- WiMAX mesh backbone and a second, dedicated 802.11b/g Wi-Fi access radio. It consists of 802.11 b/g access network in the 2.4 GHz spectrum to enable customers to connect to the network and 802.11a backhaul mesh in the 5.8 GHz spectrum to aggregate all the traffic in the neighborhood network area which is then backhauled to a central POP via point to point wireless backhaul in the 18 GHz licensed spectrum links. This architecture reduces the cost of backhaul significantly while offering high reliability. MetroFi will deliver a state of the art network with density of 20-30 nodes per square mile. This network in densely populated areas will deliver 95% in-street (outdoor) coverage with no additional hardware than a standard 802.11b/g card within a wireless laptop or other wireless enabled devices. Client distance is minimized to no more than approximately 600 It from any node as a result of our dense "pico-cell" architecture. The Network design will support in-building coverage as measured by a single, first or second floor room (e.g. adjacent to an extedor wall in the residence or business) and access to the wireless network is at 1Mbps best-effort speed levels. Subscribers who are less than 300 feet can typically achieve a good performance with their Iow-power RF device such as a laptop. Customer between 300-450 feet may require a higher power device. Customers who are farther than 450 feet will typically require an outdoor antenna that needs to be mounted with some line of sight to the nearest 802.11b/g access point. MetroFi will offer a high power device with integrated security to customers for improved performance and enhanced customer experience. 802.11a Dual-band 802.11a & big radio Wireless modem w/auto- ' setup & built-in security MetroFi intends to offer access to virtually the entire city on both Wi-Fi and WiMAX Tiers of the network. Lack of mounting assets, building restrictions, very Iow household Copyright MetroFi, Inc. 4 MetroFi Overview/Proposal density, obstructions and other physical limitations can prevent us from 100% ubiquitous coverage. Security MetroFi supports multiple security options. Our network supports standard capture portal for Free users. All $19.95 customers and Free customers wanting security will use an 802. l li/WPA/802.1x standard implementation. Ad support Our vision is that this system is a community extension to the Internet. Tying in local government and small business is an integral part of creating'this community. Small businesses have limited local advertising vehicles. MetroFi will offer a unique way for these Bakersfield based businesses to build brand awareness of their products and services, sell products, services or content directly online, generate local leads and traffic to their website and provide information and education to the residents and visitors of Bakersfield. Our advertising rates will be below traditional print, mail and outdoor prices. Regulations MetroFi'will comply with all Qty, County, State and Federal regulations. MetroFi does expect the City of Bakersfield and municipal offices such as Planning, Electrical and Building departments to streamline the Permitting application and issuance processes. A Iow cost, high quality Wireless broadband community area network can only be built if the vision of mutual cooperation and interdependency of the government and private sector is fulfilled. Safety and compliance are top priorities at MetroFi. Costs to the City of Bakersfield There are no direct costs to the-City of Bakersfield in the MetroFi Proposal. The only indirect costs are in streamlining the permitting process for traffic/streetlight poles and city owned rooftops and MetroFi will also pay for all electric usage. MetroFi will provide 100% of the financing for system design, capital build-out, ongoing operation, maintenance and repair of the wireless. broadband system. Examples of other Similar Projects Currently Ongoing. Santa Clara, CA 102,000 population, 11 square miles, > 200 nodes Cupertino, CA 50,546 population, 7 square miles, 100 nodes Sunnyvale, CA 132,000 population, 4 sq. miles, >100 nodes Mountain View, CA Facilities Use/Pole Attachment Agreement San Francisco Hot Zones 3 public plazas Copyright MetroFi, Inc. 5 MetroFi Overview/Proposal Santa Clara, Cupertino and Sunnyvale networks - ~21 square miles and over 400 Mesh Radios MetroFi~ Inc. 516 Clyde Avenue Mountain View, CA 94043 Ben Zifrony VP Sales and Business Development bzifrony@metrofi.com (650) 810-8029 Copyright MetmFi, Inc. 6 Strategies for building m. unicipal wireless networks are evolving fast But are they prudent in the long run.'.*  BY CHRISTOPHER SWOPE L ook at San Frandsco's plan for gesting creative ways to provide free dty- 2oo dries across the countryare nowclam- blanketing the city with. wire- wide WiFi at no cost to taxpayers. The idea oring for free WiFioftheir own, with many less Intemet access, and you that got the most attention was put together of them demanding similar sweetheart maywonder if you're reading a by Google and EarthLink, which teamed up deals. Nearly allofthe dries share the same. memo to Santa Claus. San onaplantopayforfreeWiFibytargetingad- admirable goals: They want WiFi for eco- Frandsco wants anyone with a vertising at Intemet users. But there were nomic development, to bridge the digitaldi- laptop or handheld computer to be able toother free models proposed, too. One local vide andto make their own mobile workers get online from just about anywhere in nonprofit, for example, partneredwithIBM more effident in the field. But can they re- town. Not only is the dty unwilling to pay a andCiscotosuggestpayingforanetworkby alistically expect to get all of that free? dime to get a citywide "WiFi' system built selling corporate sponsorships and seeking That's onlyone question does should be but it also wants public access to be free. donations from local philanthropists, asking as they hop on the WiFi bandwagon. You might expect that technology com- San Frandsco ultimately went with the Nowadays, getting wired for the 2xst cen- parries would laugh at such an audadous scheme proposed by Google and Earth- tury seems so 2otb century. Getting un- wish list and walk away. They didn't. In fact, Link. It will be many months before that u,qred is the next big thing, and dries are the dtyreceived a half-dozen proposals, sug- system goes live: Nevertheless, more thanmoving forward at a frantic pace. After all, 54 MAY2006 GOVERNING it was only a couple of years ago that cities fighting cameras and give cops better data established rules or business models to roi- began setting up small WiFi "hotspots" in capabilities while on patrol. Customers low. So cities are rnaking up the rules as airports, parks and libraries. Now, they're could also take advantage at home--if their they go along. A few jurisdictions arelook- talking about entire cities as hotspots, computerisnearawindow--orwiththeaid ingatWiFiasamunicipalutilitylikewater They're even considering how to connect ora signal booster if it is not. andseWers. They believe that the public sec. cities to form regional wireless networks. The reason cities are getting involved in . tot should own the networ~ven if they The idea is pretty Simple: to create one WiFi, rather than leaving it entirely to the outsource the customer service. Most, how- contiguous cloud of outdoor Internet ac- private sector, is because they want to en- ever; arelooking at partnering with vendors c.ess. That wouldn't just indulge road war. sure that poor neighborhoods are covered that will build and own the networks at nors with their laptop computers and just as well as rich ones. In addition, cities their own eXPense and make money either PDAs. It would also enable new technolo- own a vital piece of infrastructure--the bycharging subscription fees or selling on- gies, such as handheld Internet phones, to streetlights--to which WiFi routers can be line advertising. flourish. Cities themselves would be big mounted and used for electricity. Either way, strategies around municipal customers, using WiFi to liberate building Conceiving o£ WiFi on this giant scale, wireless are evolving fast. Philadelphia, for inspectors from their desks, enable crime- however, is so new that there aren't many example, famously announcedthefirstbig. GOVERNING MAY 2006 dty wireless proiect less than two years ago. to administer the arrangement, thinksthe WiFi access for free. Likewise, Grand Back then, officials envisioned building a trade-offs of private ownership are worthit. Rapids, Michigan, stated upfront that the publicly owned network at taxpayer ex- "They're building the network on their own city wouldn't use any taxpayer funds to pay pense. But that plan ran into opposition, dime-we're not spending any money at for its WiFi network. "City resources are The incumbent cable and telephone com-. all," he says. "Welose some level of control, stretched pretty thin," says Sally Wesorick, parties objected to the idea of the public sec- But we got many of the things we'd want the wireless project manager there. tor competingwith their.own broadband of- from our own munidpalnetwork--without Settles believes that dries are drunk on ferings. Many drizens, too, scoffedat the es- having to figure out how to nm it." the idea of getting something for nothing, rimated Sxo million price tag. and should be more cautious in their ap- Then, last year, EarthLink made proach. Philadelphia, he says, isn't really Philadelphia an offer it couldn't refuse: to NO Cash Down getting a free network. It's getting a "no- build and operate a WiFi network at the Cities responded enthusiastically to the cash-down" network, paid for later by sub- company's own expense. What's more, news out of Philadelphia and San Fran- scribers. If cities demand too much for EarthLink offered Philadelphia 3,ooo free cisco. Perhaps a bit too enthusiastically, in free, they risk getting shoddy hardware or ordiscountedwireless accounts for its field the view of some observers. "The feeding badserviceorinthecaseofupstartvendors, workers; a slice of its revenues, in order to frenzy has started," says Craig Settles, the pushing them to promiSe.more than they buy computers for low-income families; author of a recent book on munidpalwire- can deliver, Settles says. "Judging by the and discounted service to help get those lessprojects."Everyone'ssaying,'Iwantmy haste with which dties are going from press families online ($9.95 a month versus a free network, too.'" release to RFP to finding a vendor, I don't likely retail rate of about $20 a month). In Not a day goesby lately without a mayor sense that much analysis or due diligence is exchange, Philadelphia would have to give announcinga newwireless initiative or a dty being done;' up usage rights to 4,000 dty-owned street- issuing a new request for proposals. The Nevertheless, the Philadelphia model lights. Importantly, EarthLink--not the plans look a little different in each dty. But is emerging as something of a blueprint, at city--would own the network, the idea that WiFi should come at no cost-- least for many big dries. Rather than build- Philadelphia took EarthLink up on its either to consumers, to dtycoffers or both-- ing out WiFi themselves, they're turning offer, although the deal still awaits dty pervades much of the discussion. Wash- theup-frontcostandcustomer, service has- council approval. Derek Pew, interim CEO ington, D.C., for example, plans to stipulate sle over to private companies and then reg- of Wireless Philadelphia, a nonprofit set up in its RFP that Iow-income residents get ulating it. In some ways, this resembles the. emergence of cable television 30 years ago, when dries signed the first franchise agree- ments with cable companies. A maior dif- ference is that rather than granting local monopolies, as dries initially did with cable, they are pursuing an open-access model with WiFi. In Philadelphia, for example, EarthLink must let other Intemet service providers sell services over its network. Some see other advantages to this model. The big one is a matter of mirigat- ing the risk that anOther wireless technol- ogy might overtake WiFi and make it obso- lete. That's one reason why Portland de- tided to follow the Philadelphia model, ac- cording to Rashid Ahrned, senior proiect coordinator for the Portland Development Commission. In April, Portland chose MetroFi to build a free, ad-supported net- ork. One of the major concerns ts how do you know you're not buying an 8-track tape.. You don't--so we're not buying any of it," Ahmed says. ~The city's role in this is we iust want to be a customer of a privately op- erated system, so the risk is £trmly on the shoulders where it belongs, the private sec- tor, to choose the right technologies and make it happen." Portland is offering itself as an "anchor 5& MAY2006 GOVERNING Portland is already dotted with w reless Internet hotspots. Soo.n. Wi.Fi will go c tywlde. utilities, intended to automate the reading of gas and water meters. It turned out that the meters needed to upload data only twice a day, using just a fraction of the net- work's bandwidth. About that time, the national buzz around CityWide wireless picked up, and Corpus Christi realized that it already had the building blocks of a network in placel "What we'd stumbled upon is the newest infrastructure for city governments," says Leonard Scott, busi- ness unit manager for the city's manage- ment 'information systems department.. tenant" for the WiFi network, meaning that mental derision that policy makers need to "We haven't had one of these come along the dty will be one of the biggest wireless make is not a nuts-and-bolts technology de- in about 15o years." customers. WiFi will substantially cut the dsion but this question of ownership:' Now, Corpus Christiis in the process of cost of the city's "smart" parking meters, building out WiFiacross the dty's entire ~47 which require an Intemet connection to up- square miles. The project will cost $7 million load credit card data. Policeexpecttousethe. ANew Infrastructure andisslatedforcompletionbyAugust. The system to download mug shots and other For now, however, public ownership is an dty doesn't plan to deal with customers di- data to their squad cars. And the local tran- idea that is gaining traction only among rectly. Rather, it expects to sell access at sitagencyislookingatusingWiFitocreate smaller dties. St. Cloud, Florida, is one of wholesale rates to local Intemet service a system that would tell bus passengers them. St. Cloud got started in WiFi three providers. They, inturn, wouldsellwireless how long they'll have to wait until the next years ago when it built a hotspot in a busi- Intemet service to consumers. The dry es- bus arrives, nesspark. Theideathenwastousewireless timates that its capital investment will be Critics of these arrangements, however, asahooktoattractbusinesses. Later, cityof- paid off in four years. argue that cities like Portland aren't really fidals came around to the idea of WiFi as a As Scott sees it, smaller dries may have sidestepping risk. In fact, by agreeing to act 'hook for residents, too. to take a more active role in makingwireless as anchor tenants, they may be exacerbating St. Cloud estimated that ils dtizens were Internet come to fruition because they the downside if these unproven business collectively spending $4 million a year on won't attract the same amount of interest models don't pan out. BeccaVargo DaggeR, Intemet access. For $2.6 million, the dty from vendors as cities such as Philadel. aresearcherwiththeMinneapolis-basedIn- was able to build a WiFi network across the phia and San Francisco. "If second- and stitute for Local Self-Reliance, believes that entire dty and offer the service to residents third-tier titles don't start working to build dties should be more willing to consider gratis. St. Cloud hired Hewlett-Packard to their own systems, it'll be a longtime corn- wireless models in which the public owns build the network and run customer serv- lng," he says. the network. "If they're going to be relying ice, but the dry owns it. The system went "We look at it the same as we do water, on this for their intemal communications, live in early March. In its flrst three weeks, sewers, gas and the road. system," Scott there's substantial risk in that," Daggett about one-quarter of the homes in St. adds."It'sthereforthegeneralpublic'suse. says. "And it's a risk they don't control in the Cloud had signed up. We think it's very important that the city same way as if they owned it;' Corpus Christi, Texas, is taking a sim- have ownership and controlof the system;' "Alot of dries thinkthey're getting a free ilar approach to WiFi, although the dty hit network andtheyaren't," Daggettcontinues. upon it by accident. A few years ago, the Christopher Swope can be r~ached at "Ownership affects everything. The funda- city set up a pilot wireless project for its cswov~®~overnln~.corn 58 MAY 2006 GOVERNING .~ ~. Wile local govern- Philadelphia expects to pay $20 per manuals, floor plans and other informa- ~ments are devel- month for each of its 2,000 mobile work- tion so those using WiFi-enabled laptops ~ oping high-speed ers using WiFi, plus eliminate T1 lines in can assess the appropriate response to ~ wireless (WiFi) 300 remote buildings, including fire and a fire. Using wireless medical devices, networks to police stations. "We can save as much as emergency medical tesponders transmit ~ '~ i give low-income $2 million annually starting in the third patient readings to mobile units using residents free year," Neff says. wireless modems that send the data to or inexpensive hospitals before patients arrive. Para- Internet access, and to encourage eco- W[F[ is spreading medics also can transmit their reports nomic development, they also are using Cities and counties already are using from the scene. them to improve the efficiency of public citywide WiFi networks to support their Medford, Ore., spent $700,000 safety operations. A WiFi network is less mobile workers, including those in law ($500,000 of which came from federal expensive than cellular competitors, a enforcement, firefighting and emergency grants) to deploy its network over the critical factor in Philadelphia's decision medical service. Law enforcement offi- city's 24-square-mile area for police, fire to build one. "Right now we pay for data cials use WiFi to scan local and national and city employee use. Ripon, Calif., wireless for a number of field workers, databases as well as complete paperwork, built a $500,000 network covering eight such as those in public safety," says Phil- capture officers' interaction with motor- square miles, and Fresno, Calif., spent adelphia's CIO Dianah Neff. "This is'$70 ists or to watch public areas, and scan car $750,000 for the first phase of building per employee per month, so we limit the tags for vehicle or owner registration, its network to address all areas of public number of people who have access." Fire departments typically digitize safety, according to the "Second Anni- 44 May 2006 www. americancityandcounty.com Morrow County, Ore., the location b.oses, valves and sprinklers to fight haz- of the Umatilla Chemical Depot, hosts ardous materials fires on or near shores." about one.third of the nation's stockpile Tl~e center's main phone lines use of warfare materials, is home to the Han- voice over Internet protocol (VolP) ford Nuclear Reservation and also oper- phones so staff can use the Internet to ates a nuclear power station. The county call when regular phone lines or cellu- also includes natural gas and energy pro- lar networks fail. Emergency response duction and distribution facilities, vehicles are equipped with mobile WiFi Because a major natural or manmade access so they can stay connected to the disaster striking any of those facilities network while en route to hospitals. The can have devastating consequences, the network complies with the Health Insur- Morrow County Emergency Manage- ance Portability and Accountability Act ment Center's (MCEMC) team of first so patient data can be wirelessly trans- ': .. responders completed a $2 million, 1,000- mitted and with the Federal Information : .; ..:. square-mile WiFi network last month to Protection Standard. :. . .::.:: give its public safety entities monitoring In one well-planned and coordinated ~ and emergency response capabilities, effort, Morrow County addressed the '~%Liiii~i::: Cameras on the network stream real- needs of its various public safety enti- time color video to the center to moni- ties, while creating a multi-agency acces- tor its higher risk facilities. The same sible communications and operation~ cameras also monitor the highways so management network. "Nothing could the staff can respond in 10 minutes or match WiFi for moving large volumes of less when a chemical disaster occurs. To data," Beard'says. quickly evacuate residents, MCEMC will use the cameras and the network to re- More to come direct traffic by controlling traffic lights, As cities and counties become more drop arm barriers and message signs, comfortable with basic communica- "The captain of a tug moving barges tion OVer WiFi, other technologies will needs to know about any major emer- be brought to bear. After 18 months of gencies on land, so we deployed WiFi development, Oklahoma City is testing access points mounted on buoys on- the its network this month. The system origi- rivers and waterways to provide warn- nally was planned to allow police to com- ings to watercraft," says MCEMC Direc- plete reports in the field and access mug tor Casey Beard. "These also back up shots and centralized records. However, the land-based access points. We can officials now are considering expanding remotely operate un-manned fire boats' its use to geographic information systems versary Report" from MuniWireless, a website featuring municipal wireless broadband projects. In 2004, New Orleans used video sur- veillance over a WiFi network to help address increasing crime. "[Our] pilot projects saw an immediate 58 percent reduction in the murder rate in those areas, and similar reductions in other violent crime," says the city's CIO Greg Meffert. New Orleans planned to roll out data applications for its police as soon as the - network was fully deployed. But with the ° ° city crippled by Katrina, the network is used for other applications. "We were a third of the way done when Katrina hit," Meffert says. At that point, $3 million had been spent -- money secured from the city and the federal government. May 2006 4,5 to automatically ~,ute fire trucks arou:,d eras around the city and a VolP system issued requests for proposals to have hazards, such as un~a~e bridges, or direc with universal phone numbers and mes- them built or created steering commit- firefighters to hydrant~ with the high- sage routing for police officers to improve tees to pursue the initiatives. The net- est water pressure. The next stage may communication with residents, works hold the potential to significantly include the ability for mobile personnel More than 300 U.S. cities have improve public safety. to see images captured from video cam- deployed citywide wireless networks, Speaking at this year's Wireless Inter- net Institute's Digital Cities conference, ':'-" ~"' '"' ~'"': ..... :~:' ....... ~'- """: .......... '":':'"-'~'~:':'~:"'~?' Oklahoma City CIO Mark Meier sug- gested that cities considering WiFi should ensure they have a high quality of service to give public safety officials the neces- sary bandwidth in an emergency, espe- cially if the general public also is using .:~ii ::..i:i!?I::I; :'" ~ the network. He also suggested that they ::~e~=sz: test their network radios to determine if they can travel throughout the coverage area without losing the signal or data; watch costs and maintain the network using as few people as possible. Meffert also advises communities considering building a WiFi network to plan one that handles communications with public safety personnel and video surveillance. "We were able to wall off the public safety part of the network, and you'll have a much more connected, complete network," he says. Craig Settles is the Oakland, Calif.. based author of "Fighting the Good Fight for Municipal Wireless." Streets, sidewalks, alleys, parking in a day's work. 636 Hi-speed, · '-. ABA Thebiooest& ~ ~.'.L" most powerful ~,. L:..: ~.' L Step-Safe® pretest ~' Green IVlachine . polymer concrete l~et! ,< L.. L, ~: detectable warning tiles slept the visually ~' '"" mired to approaching  hazards. Step-Safe® is slip- CALL NOW for resistant and has a proven record of strong information on our resistance to wear. Applications include full line of vematile stree~ridge crossings, pedestrian islands walk-~hind and ~nd trai~subway platforms. Available in six rid~on sweepem contrasting colors, custom colors available, 1-800-SWEEP-40 (610)583-8000 ~~ y:{~:~::~,?, ~.appliedsweepers. com ~'~'~%~ ~.~'~¥" 46 May 2006 www.americancityandcounty, com From: <jpete1955@aol.com> To: <achriste@ci.bakersfield.ca.us> Date: 5/26/2006 8:34:13 AM Subject: Free Wireless in Bakersfield Area I am presently in Spokane, WA on business and they have this feature for their citizens. I would like to see us go forward with this as well. I support the initiative. Jeff Peterson From: "Jim Milledge" <jmilledge@bak.rr. com> To: <achriste@bakersfieldcity. us> Date: 5/25/2006 10:02:45 AM Subject: Wireless Internet Outstanding job for the people of Bakersfield. Wireless Internet free would be a great thing for those of us on Social Security. Hope it comes to pass and before a year as the paper stated. Again, Thank you. Jim Milledge-Bakersfield ADMINISTRATIVE REPORT MEETING DATE: June 7, 2006 AGENDA SECTION: Hearings TO: Honorable Mayor and City Council ,A,t~PROVED FROM: Raul M. Rojasl Public Works Director DEPARTMENT HEAD DATE: May 24, 2006 CITY ATTORNEY ~ CITY MANAGER SUBJECT: Hearing to consider a resolution establishing sewer service user charges and fees for Fiscal Year 2006-07 (Wards 1-7). RECOMMENDATION: Staff recommends adoption of Resolution. BACKGROUND: Sewer user charges and fees are established annually pursuant to Section 14.12.380 of the Bakersfield Municipal Code to recover costs reasonably incurred in providing regulation, operation, maintenance, replacement, and capital improvements for the storm water/sewer collection systems and wastewater treatment plants. City staff is recommending an 8.0% increase in all sewer user charges for Fiscal Year 2006-07. If approved, the .user rate for a single family dwelling will increase from $125 to $135 per year. Additional rate incr(~ases for the following user are also being phased in as adopted in the Fiscal Year 2001-2002 sewer us~.~fee ~chedule This rate will increase according to the scheduled phase-in plus the 8.0% increase as follows: Hospitals, year six of a seven year phase-in period $64.50 to $75.74 per bed Discussions regarding this phased-in rate increase for hopsitals were conducted with the City Council and the Budget & Finance Committee during the Fiscal Year 2001-2002 budget process in order to update the City's Revenue Program. The phasing-in of this fee offered the least impact to these users, while still complying with State regulations. These fee phase-ins were originally adopted by the City Council on May 16, 2001. See attached Exhibits A and B to the resolution for miscellaneous sewer user charges and fee details. Sewer user fees and charges are collected with property taxes by the Kern County Tax Collector pursuant to the Bakersfield Municipal Code. G:\GROUPDA-IAADMINRPT~2006\06-07tAdmin Rpt 06-07 Sewer User Fee.doc Is RESOLUTION NO. A RESOLUTION ESTABLISHING SEWER AND STORM SEWER SERVICE USER CHARGES WHEREAS, Chapter 14.12 of the Bakersfield Municipal Code authorizes the establishment and increase of fees and charges to recover costs for services rendered; and .... WHEREAS, a public hearing before the City Council was advertised twice in the.' Bakersfield Californian, a newspaper of general circulation and also hearing notifications were sent to users by mail; and WHEREAS, a public hearing was held to determine whether the proposed fees and charges are discriminatory or excessive; and WHEREAS, the fees and charges set forth in Exhibit "A" and Exhibit "B", attached hereto and incorporated by reference, do not exceed the reasonable estimated cost of providing the services for which the fees are charged. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF BAKERSFIELD AS FOLLOWS: 1. The above recitals and findings are true and correct and are incorporated herein by reference. 2. The fees and charges set forth in Exhibit "A" and Exhibit "B" are hereby adopted and shall become effective on July 1, 2006. 3. The adoption of these fees and charges complies with Proposition 218. 4. 'Pursuant to the Bakersfield Municipal Code, the fees and charges herein shall be collected by the Kern County Tax Collector on the property tax rolls. ............ o0o .............. G \GR OU PDAI~ADMIN R P7~2_006\06 07\Sev,'UserFeeRes00-07.DOC 5/24/2006 -- Page 1 of 2 Pages -- 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: COUNCILMEMBER MAGGARD, CARSON, BENHAM, COUCHi HANSON SULLIVAN SCRIVNER NOES: COUNCILMEMBER ABSTAIN: COUNCILMEMBER ABSENT: COUNCILMEMBER PAMELA A. McCARTHY, CMC CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED HARVEY L. HALL Mayorofthe CityofBakersfield APPROVED as to form VIRGINIA GENNARO City Attorney ROBERT M. SHERFY Deputy City Attorney G:\GROUPDAT~ADMINRP'IA2006\06 07\SewUserFeeRes06-07 DOC 5/24/2006 , , -- Page 2 of 2 Pages -- SEWER USER FEES AND CHARGES FLAT RATE SCHEDULE FISCAL YEAR 2006-07 Kern County I Flat Rate Assessor Use CodeI Description SFDE Char,cie 0100 - 0106 Single Family Residence I $135.00 0200 - 0602 Multiple Dwelling 0.75 $101.25 /unit 01(~7 - 0199, 2900 Mobile Home, Mobile Home Park 0.75 $101.25 /unit 1100 Small Store and Shop 1 $135.00 1200 Combination Store & ©ffice 1 $135.00 1300 Large Store 1.5 $202.50 1400 Market 1.5 $202.50 1600, 2100 Office & Financial Bldg 1.5 $202.50 1701 Hospital 0.561 * $75.74 /bed 1703, 17121 1714 Rest Home, Retirement Home, etc. 1.5 $202.50 1704, 1705 Medical Lab, Ambulance 1.5 $202.50 1706 Church 1 $135.00 1707-1709 Mortuary, etc. 1.5 $202.50 1710, 1713 Schools, Day Care Center 0.04 $5.40 /student 1800 Food or Beverage 1.5 · $202.50 ' 1900 Recreational 1.5 $202.50 2201 Car Wash 1.5 $202.50 2202-2290 Service Shop 1.5 $202.50 2300 Petroleum 1.5 $202.50 2400, 3800 Sales, Industrial Sales 1.5 $202.50 2600 NUrseries 1 $135.00 2700, 2800 Hotel-Motel 0.3 $40.50 /room 2901 Travel Trailer or R.V. Park 0.3 $40.50 /space 3100, 3200 Light & Heavy Industry 1.5 $202.50 3300, 3400 Timber & Produce Plant 1;5 $202.50 3500 Food Processing 1.5 '$'202.50 3600, 3700 Storage-Warehouse 1.5 $202.50 year 6 of 7-yearphase-in period as approved by the City Council on May 16, 200~, Resolution No. 066-01. G:~GROUPDAT~ADMINRPT~2006\06-O7\FR schedule. XLS 1 of 3 5/24t2oo$ SEWER USER FEES AND CHARGES MISCELLANEOUS SCHEDULE FISCAL YEAR 2006-07 EXHIBITA I. Septic Discharges 1. Permit Application Fee, shall be $20.00 2. Septage Discharge Permit Fee, shall be $100.00 3. Septage Discharge Permit Renewal Fee,' shall be $50.00 4. The rate per gallon, shall be $0.023 5. The surcharge for outside septage discharges, (septage ' originating outside the city limits) the rate per gallon, shall be $0.023 This surcharge is to recover capital expenditures and administrative costs: II. Surcharqe for Outside Users $62.42/yr./connection for single family dwelling, $41.62/yr/unit for multiple dwelling, $62.42/yr./business for commercial and industrial facilities, $10.41 /yr/room for hotels/motels This surcharge includes a capacity charge for reserving a portion of City's trunkline and sewage treatment facilities and a capital charge for recovering of subsequent City capital costs. III. Industrial Waste Discharqe Monitorinq 1. Application Fee $50.00 2. Discharge monitoring annual fee $643.00 3. Noncompliance re-inspections $643.00 4. Outside laboratory testing fees actual costs 5. Cost Recovery Rate Schedule See Exhibit B IV. Wastewater Services - Other Aqencies 1. East Niles Community Services Dist: $489,995 (Est.) 2. Kern Sanitation Authority $144,188 (Est.) 3. County Service Area 71 $61,662 (Est.) Wastewater service is provided for these unincorporated areas. V. Connection Fee For Major Industrial Dischar.qer Unit Rates: Based on maximum monthloadings. Flow $0.79/gpd , BOD $54O/ppd TSS $172/ppd C:\DOCUME~I \glorenzi\LOCALS-l\] crop\fee 06-07 Exhibil A DOC 5131/2006 2of3 SEWER USER FEES AND CHARGES (CONT.) MISCELLANEOUS SCHEDULE EXHIBIT A FISCAL YEAR 2006-07 VI.. Wastewater/StormsewerApportionment The rates contained in this exhibit cover 100% of costs reasonably incurred in providing the operation, maintenance, replacement, and capital'improvements of the existing wastewater plants, sewers, and storm sewer systems. Eighty-six (86) percent of said rates are attributable to sanitary sewer use, maintenance, replacement and improvements and fourteen (14) percent of said rates are attributable to storm sewer use ,' maintenance, replacement and improvements. Definitions: B©D - Means "biochemical oxygen demand" TSS - Means"total suspended solids" mg/L - Means "milligrams per liter" SFDE - Means "single family dwelling equivalent" C:\DOC UME - l\glorenzi\[.OCALS - 1 \] emp\fee 06-07 Exhibit A DOC 5/31/2006 3 of 3 ~ City of Bakersfield Enforcement Response Plan ~ Cost Recovery Rate Schedule FY 06-07 EXHIBIT B cost ($) A. Notice of Violation (NOV) Basic $52 B. Lab Fees ~ Arsenic 30 Cadmium 30 Chromium (total) 30 Copper 30 Lead 30 Molybdenum 30 Nickel 30 Selenium 30 Silver 30 Zinc 30. Mercury 42 Volatile Organic Chemicals (VOC) 150 Benzene 1, 2-Dichlorbenz ene 1, 4-Dichlorbenzene , Ethylbenzene Methylene Chloride Tetrachloroethene Toluene Travel Blank Analysis (VOC) 150 Phenols 39 Total Dissolved Solids 40 pH 20 BOD (seeded) 50 Total Suspended Solids (glass fiber) 25 Chemical Oxygen Demand 29 Oil & Grease 50 EC 20. Dissolved Sulfides 30 Sample Disposal 5 Note: Users may be charged with invoiced amount by commercial laboratory instead of rates listed above. C. Other Rates: Wastewater Staff Salary Schedule & Fringe Benefits Wastewater Van $5.09/hour Automatic sampler $5.05/day Replacements Pads and Materials invoiced amount Outside Labor costs for cleaning, repai invoiced amount or replacement work, etc. Overhead cost will be assessed where applicable. G:\GROUPDATbADMINRPT~2006\06-O7\ERP penalty sch.xls , O TRATIVE ADMINIS REPORT MEETING DATE: June 7, 2006 AGENDA SECTION: Hearings r ITEM: [9.C. TO: Honorable Mayor and City Council APPROVED FROM: Nelson K. Smith, Finance Director DEPARTMENT HEAD DATE: May 25, 2006 CITY ATTORNEY CITY MANAGER SUBJECT: Public Hearing to consider a Resolution Adopting Sewer Connection Fees Pursuant to Section 14.12.380 of. the Bakersfield Municipal Code. RECOMMENDAT~iON: Budget and Finance Committee recommends adoption of the Resolution. BACKGROUND: The City has been developing a financing plan for the expansion of Wastewater Plant #3. The City's bond consultant presented an extensive multi-city fee survey and an overview of the draft financing plan to the Budget and Finance Committee at their March 8, 2006 meeting. Part of the financing plan includes the raising of Sewer Connection Fee charges to assist in the repayment'of the debt service on the impending plant expansion. While all sewer revenues will be Pledged against any debt incurred for the-project, the City has historically attempted to cover the annual debt service requirements with connection fee revenues, so to match the cost of plant expansion with the associated new development growth that is driving the need for the plant expansion. Staff has proposed a "phased" approach to the fee increases to provide developers with a known plan for this fee to assist in their forecasting and planning processes. The current fee for a single family residence is $2,500. The proposed fee schedule, which is designed to provide adequate debt service coverage for the proposed bond issue, will raise the fee $300 per year for the next five years, with the single family fee reaching $4,000 in July 2010. A draft resolution and fee schedule is attached for your consideration. The Budget and Finance Committee reviewed the proposed fee increases at their May 9, 2006 committee meeting and recommended the resolution and related fee increases be forwarded to the City Council for their consideration. The committee did ask whether special fee credits for infill housing projects could be considered. Staff explained that the property owner would receive credit related to the sewer uses previously on the land. Thus the property owner would not have to pay a second connection fee if the same level of sewer service was being proposed with the infill project as was on the land previously. There was also some concern whether these credits might have a negative impact on our bond rating or ability to finance the project. Staff has checked with the City's bond consultant and determined that this type of credit would not, in and of itself, have any effect on our ability to sell sewer revenue bonds. nks P:~Bond Issues~Admin ~ sewer connection fees reso.doc May 25, 2006 , RESOLUTION NO. A RESOLUTION ADOPTING SEWER CONNECTION FEES PURSUANT TO SECTION 14.12.380 OF THE BAKERSFIELD MUNICIPAL CODE. WHEREAS, Section 14.12.380 of the Bakersfield Municipal Code (BMC) authorizes the establishment each fiscal year of sewer connection fees sufficient for the City to recover the reasonable costs of providing sewer connection services, which include the costs associated With and necessitated by the upgrading and expansion of sewer facilities; and WHEREAS, the City plans to upgrade and expand Sewer Treatment Plant #3 from 16 MGD capacity (mgd = million gallons daily) to 32 MGD capacity and finance the improvements, in whole or in part, with Sewer Revenue Bonds; and WHEREAS, City staff have computed the reasonable cost of providing sewer connection service through fiscal year 2010-2011; and WHEREAS, the sewer connection fees set forth in Exhibit "A" attached hereto and incorporated by reference as though fully set forth herein, do not exceed the reasonable estimated cost of providing the services for which the fees are charged; and WHEREAS, the fees shall be due and payable upon application for a building permit or permit to connect an existing building to the City sewer system. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Bakersfield as follows: 1. The above recitals and findings are true and correct; 2. The Sewer Connection Fees under Section 14.12.380 of the Bakersfield Municipal Code are hereby adopted and shall become effective on the dates and in the amounts set forth in Exhibit "A", attached hereto. Page 1 of 3 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: COUNCILMEMBERCARSON, BENHAM, MAGGARD, COUCH, HANSON, SULLiVAN, SCRiVNER NOES: AGENCYMEMBER ABSTAIN: AGENCYMEMBER ABSENT: AGENCYMEMBER CITY CLERK and EX OFFICIO of the Council of the City of Bakersfield APPROVED: HARVEY L. HALL, MAYOR CITY OF BAKERSFIELD APPROVED AS TO FORM: VIRGINIA GENNARO CITY ATTORNEY By: JANICE SCANLAN Assistant City Attorney Page 2 of 3 EXHIBIT "A" I. CONNECTION CHARGES All new connections or new fixture units connected to the City sewer system will require payment of a sewer connection charge. Any individual, firm, company or corporation making such connectiOn shall pay the charge at the time the building permit is issued in accordance with the following: Dwellings Per Fixture Single Multiple with 14 or Unit for Family Family Less Fix-ture Commercial or Effective Date ~~ ~ ~ ~ ~---~,800 $2,106 $--'"~,782 $127 J____~.~l, 2007 $3,100 $2,232 $1,973 $141 ~ $3,400 $2,448 $2,164 $155 · J__._~.~l, 2009 $3,700 $2,664 - $2,355 ~ $168 ~ 1, 2.010 $4,000 $21880 $2,545 $182 (A) Single family dwellings or units in multiple family dwellings with 14 or less fixture units (including shared fixtures in multiple unit complexes) as per Uniform Building Code and with tw° (2) bedrooms or less. (B) Equivalency factor shall be 1.0 for all uses excepting markets, mortuaries, restaurants/coffee shops, food service shops and bakerieS which uses shall have an equivalency factor of 2.0. To determine the total connection charge, multiply the number of fixture units (as per Uniform Plumbing Code) by the per fixture charge and that answer by the equivalency multiplier. The equivalency multiplier adjusts for loadings greater or less than the residential loadings. II. .,TIMING AND BASIS The sewer connection charge is to be paid prior to issuance of a building permit, and will be based on the current adopted charges at the time of issuance of the permit. Fixture Units shall be as defined in the Uniform Plumbing Code. File name:p;nks'bond issues;resolution sewer conr~ection fees 2006.doc Page 3 of 3 BAKERSFIELD May 17,2006 Department of Transportation Audits and Investigations 1304 O Street, Suite 200 Sacramento, CA 94274-0001 Attn: Maura F. Twomey Dear Ms. Twomey, Thank you for your examination of the City of Bakersfield's indirect cost rate proposals for the FY 2002/03 and 2003/04 and also for the approval of such rates.' We have carefully reviewed finding number 1 fi.om your report dated May 16, 2006 that relates to the Department of Public Works procedures for tracking indirect labor. We will incorporate your recommendation into the City's current time keeping procedures by requiring the DPW to code all labor hours worked with an identifier (project) code. We believe that this procedural change will strengthen the City's internal controls and documentation standards associated with the Federal regulations sited in your audit finding. If you have any questions or need any additional information please feel free to contact me. Sincerely, Nelson K. Smith Finance Director Cc: Gary Yarber, FHWA Gary Buckhammer, Division of Accounting DLAE, District 6 City of Bakersfield · Finance Department · 1501 Truxtun Avenue SAAdmin\Letters\CalTransresponse2006.doo Bakersfield · California · 93301 (661) 326-3742 · Fax (661) 852-2040 · f-mail: finance@bakersfieldcity, us ADMINISTRATIVE REPORT ME~- I lNG DATE: May 10, 2006 AGENDA SECTION: Consent Calendar ITEM: TO: Honorable Mayor and City Council APPROVED FROM: Raul Rojas, Public Works Manager DEPARTMENT HEAD ~... DATE: April 24, 2006 CITY ATTORNEY ~ ///----, ' C ITYMANAGER' ~'. _/~-'-'/ ' SUBJECT: Memorandum of Understanding with the County of Kern for joint effort to/develop a metropolitan area refuse transfer station. RECOMMENDATION: Staff recommends approval of Memorandum of Understanding. BACKGROUND: On February 28, 2005, City and County staff made a joint presentation on the status of the Metro Transfer Station to the Joint Meeting of the Kern County Board of Supervisors and the Bakersfield City Council. There was a consensus that a Metro Transfer Station Project would be strengthened if the City and County jointly move forward from this point, seeking grant funding where possible. City staff has applied for federal Congestion Mitigation/Air Quality grant funds for a transfer station project, in both the 2005 and 2006 grant cycles, on behalf of the City and County. The Board of Supervisors made a referral to County staff to report back at the next joint meeting regarding development of a Joint Powers Authority (J.P.A.) or Memorandum of Understanding (M.O.U.). The Bakersfield City Council made and approved a similar motion. The Ad Hoc Committee of the Kern County Solid Waste Advisory Committee met on 'March 7, 2005 to discuss the joint council referral and to discuss the scope of a J.P.A./M.O.U. and potential transfer station sites. It was determined that an M.O.U. was the appropriate instrument for both jurisdictions. This was reported back to the Board of Supervisors and the City Council at the September 19, 2005 joint meeting. An M.O.U. has been prepared with input from staff in both jurisdictions. kb Apdl 27, 2006, 10:45AM G:\GROUPDA'IAADMINRP'IA2.006\05.10\Refuse Transfer Station MOU.doc Kern County ^¢. 0 o786, MEMORANDUM OF UNDERSTANDING REGARDING METROPOLITAN BAKERSFIELD REFUSE TRANSFER STATION AND SOURCE REDUCTION AND RECYCLING PROGRAMS (City of Bakersfield - County of Kern) This Agreement, made and entered into this ,~5''r~ day of ~p£1~- ,' 2006, by and between the City of Bakersfield, a municipal corporation with its incorporated city limits in the County of Kern (hereinafter referred to as "City"), and the County of Kern, a political subdivision of the State of California (hereinafter referred to as "County"). WITNESSETH: WHEREAS, the California Integrated Waste Management Act of '1989 (commonly referred to as AB939), codified in part at California Public Resources Code Sections 40000 et seq., mandates that cities and counties prepare and implement plans · for the diversion of solid waste from disposal; and WHEREAS, the increasing rate of residential .growth within the metropolitan Bakersfield area, the Legislature's consideration of higher rates of diversion from the landfills and the need to address common issues such as refuse transfer stations and diversion of solid waste from disposal within the metropolitan Bakersfield area has accelerated the need for joint planning and cooperative effort; and WHEREAS, the metropolitan Bakersfield area, as part of the San Joaquin Valley Air Pollution Control District, has not reached attainment of federal clean air standards, creating the need for air pollution reduction measures in both the City and the County; and WHEREAS, the signatories hereto have determined that there is a need for cooperation in the planning, operation and maintenance of transfer facilities and source reduction and recycling prbgrams within the metropolitan Bakersfield area; and Page 1 of 3 WHEREAS, Article 1, Chapter 5, Division 7, Title I (commencing with Section 6500) of the California Government Code permits two or more public agencies to jointly exercise any power common to them; and WHEREAS, each signatory has determined that it is economically practical and for its public benefit and in its interest to do so; NOW, THEREFORE, it is mutually agreed as follows: In order to meet their refuse transfer needs and waste diversion goals, to satisfy the requirements of AB 939, to plan for and implement source reduction and recycling programs within the boundaries of the metropolitan Bakersfield area, which shall be the same as the boundaries of the metropolitan Bakersfield 2010 General Plan, the parties hereby agree to work cooperatively on the following: A. Coordination on joint programs that will be conducted within the metropolitan Bakersfield area including bulky waste collection, household hazardous waste collection, recyclable material collection, and other programs directed at recycling of materials or diversion from the landfill; B. Studying and planning, as appropriate, for the construction or expansion of transfer stations for the benefit of the metropolitan Bakersfield area to reduce the distance municipal and franchise haulers and self-haulers travel to dispose of waste; C. Joint application for grant funding for Programs or activities that will be beneficial to meeting waste diversion goals within the metropolitan Bakersfield area; D. Joint planning and coordination on mitigation measures to compensate for the impacts of new growth on the recycling and disposal programs within the metropolitan Bakersfield area. /// /// /// Page 2 of 3 IN WITNESS WHEREOF, the parties hereto have caused this Memorandum of Understanding to be executed by their respective authorized officers. "CITY" "COUNTY" CITY OF BAKERSFIELD COUNTY OF KERN By: By: "¢~~~,~~ HARVEY L. HALL .v.~c~- CHAIRMAN;' Mayor Board of Supervisors APPROVED AS TO FORM: APPROVED AND RECOMMENDED: VIRGINIA GENNARO WASTE MANAGEMENT DEPARTMENT City Attorney ~JANIC¢ SCANLAN DAPHNE B. HAREEY ~ Assistant City Attorney Director Insurance APPROVED AS TO CONTENT: APPROVED AS TO FORM' PUBLIC WORKS DEPARTMENT OFFICE OF COUNTY COUNSEL By: r'''J~''''l __ By: RAUL ROJAS STEPHEN D. SCHUETT Public Works Director Assistant County Counsel COUNTERSIGNED: By: NELSON SMITH · Finance Director , I:\CLERICAL~dmin_WMD\SWMAC\M'OU MetroTS_2006.doc Page 3 of 3 PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date -~/'~/,~-~' - You are invited to address the Committee under-Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor-Mike Maggard Name: ~~*~ ~~y Organization: Phone: ~-~.~ ~ Fax/e-mail:{[~?,~__,..~. _~.~.~-,.v..--. Subject: C~'~~-~4' '~' BAKERS. FI:ELD PUBLIC WORKS DEPARTMENT BAKERSF!E/D,.C.~ [jFO~IA 9330J. D~GTO~ CrPt5 ~O~E~ SO~'WAS~E MANAG~ Fobma~ 23~.200~ Mn La~'Moxley ' :. 0208 ~mb~mmoR Dr. Bake~eld, CA g33~ Re: Your.Reque~for Re~se Hauling ~n~a~.~ension Inms~.to ~ur.Janua~'3, 2006 leffer:mqUe~ing an 1i year'e~ension of.time.for · e C~s refuse hauling ~ntmct~h.. Kem Re~se Dis~l,; I~., the Budget ~and Finan~: ~mm~ of ~eC~ ~uncil Pmmp~.mett° ~n~der'the ma~er:on Febma~ '8m: The'~mm~ dire~'~aff:~ negotiate the maff~:~th you; ba~'on-a ii.,of :.'~; te~swe ~mmended. tothe ~mm~ as fair exchange'~r'the ~lue of ~ ~ntm~ ~e e~ension. ~is le~er is ~tend~'to Pm~de you: de~ils of :the'te~s pre~ously .~' li~~ in the .~aff memo 'tO;the ~mm~ee. Ra~ Relate: Eems 1, Sflpula~.ffi'at no rate increaseso~er ~an ~e CU~n~.'u~d COnsumer Price'lndeX will: ~ sought cluing ~e. ~'~ of~ agmemenL Re~nt.~u~s for rote in.eases to ~ver ~el and wooer ~mpen~tion ~s tho~ht'by ~e con~a~or tobe e~mneous, tO. the agm~ C. IP:wem. not sub~a~at~,. The:.only foreseeable ma~n for ahauling r~e increase ~uM'be a' change in the'haUl di~an~ .to'~e unloading ~int. 2. ~umnce that.haulem will main~in or rep.la~ ~ as nee~d throughout · e te~ of ~e agreement, to safis~ Public demand: ~ judge'd-~ ~.C~, ~ ca~ in' ~e age in'~eir life ~Cle, wiffi~.additional com~nsation. Refuse ~s-~ll even~ai~ d~mde to ~e ~int:.that t~y. am ~ longer a~p~ble ~ru~. The C~ msewes'funds for mpla~ment of ~ o~ ~.~ ~at no rote Spikewill/~ur due t0 f~um ~ repla~me~. GNen ~e e~eden~' with ~ in~nto~ since ~e ! 993 pilot. P~ram,:.the C~ exP~ts ~e inventor: to ~m' over: at least Once. and pe~ap's :~ dUdng ~'te~ yOu ha~ ~Ue~. ~e: CEyis prepar~ to do ~:'and expels ~e ~me of ~.~s 410t ~UXTUN AVENUE {~ l) 32~31 [4 ~.. provided by the contractor, with n° POtential for the. c°ntractor to delay replacement if the City considers it necessary. 3. Stipulate that rates for new programs or service in response to'future requirements will be based on City cost studies 'or pilot programs. If:the City findS it necessary .to add new waste or recycling programs for the contractor to perform in addition to the' basic level of service in the. contract, the '. city may run. p~t programs or perform' cost studies to compare costS to any rates proposed by the contractor and set rates accordingly:- . 4; RedUce and stabilize hauling rates; in the event City proVides for the use of a'refuse transfer'station. :. The- contract allows rate adjustments· dueto changes.in haul distance to disposal .siteS;r For example, :the City Paid a rate increase when the: COunty shifted refuse tmcks away from the:Arvin Landfill. However, rates COuld' increase or decrease depending on the situation. ,DiSposal sites, may in·the fUtUre'inClude transfer Stations of. other' types' of. faCilities. 5.' PrOvide residential .blUe.cart" curbside recycling service.' in lieu of"eXtra tan, refuse carts currently in .use, if City chooses to convert, these services. ::- (May·inclUde all paid and "trade-in'extratan refuse', carts so that blue carts would be proVided in lieU 'of'either'0r. bOth types.) ~" Although the City'has no definite plans at this.time/it may be necessary to phase:.". out'extra trash carts in favor of blue recycling carts in-the fUture. TheCity may request sUbStitution Of-blue', cart service in lieu of extra trash carts. Used in the . current 'system. - 6. Establish Uniform. rates and .terms for miscellaneous charges 'historically made by different haUling companies to the customers for. VariOus special cases, including: a. Special and/Or extra pick. up'charges b.: Return'. trip.charges . c, Temporary bin delivery, pick. up, and' rental d, Locking bin service.fee e~. Handling overloaded Containers These'ffems are. Often confUsing to residents and businesses throughoUt the City. 'Work isneeded to' bring consistency'to'the publiC. Contract Related Items 1'.InClUde new clause for compliance with state air emission rules as required by law, without.cost to the-City. Although the current rcontract already reqUires the contractor to COmply with all rules and regulations for refuse' hauling, the'neW CARB refuse fleetlrule requires specific teXt in all new refUse agreements. .:' $:~vlL[N~ CORpuC_.S'~MANAGER'~,Iaulh~g Coulzact Ezte~ioa Letter 2-2.3-06,de¢ 2. Open the C&D facility to the public as originally agreed or:. a..Terminate the C&D.facility lease' or reduce the acreage in the lease so that the City can use the space to handle pUblic C&D recycling. b. Terminate the C&D operating agreement under which the City assists.MRC with costs~ The. City.has fostered the contractor, s subSidiary operation for several years withoutreceMng the intended benefit Of inCreased recycling. CitY support' has'included: 1. A low-cost lease for the property; 2. Reduced cleanupbOnd requirements. 3. Rearrangement of the gmenwaste facility to give the contractor · mad frontage, to reduce: development'cost. 4, Permits obtained from regulatory agencies. 5. Sharing:'of gmenwaste facility infraStrUcture.(common entrance, use of fuel:facility, and utilitieS) to minimize contractor cost; 6; Staffing of scalehoUse.and regulatOry reporting.. 7, Assistance.with removal of a subtenant problem'. in addition to :the':.'above,~the CoUnty once: granted a refuse fee increase'in part to provide'the public.a C&D recycling optiOn'; In' spite of the' high level of. City Ass~nce-and. financial adva'ntages PrO vided, rthe C&D facility" is just nM· beginning to'accept limited numbers of customersfo~ng.urging bYbOth the City.and County, When the issue has been diScuSSed in various'forums, you have.indicated that'it isa costburden for the contractor. Since.one. purpose of your.reqUest for a refuse contract extension is to secure financing for the C&D facility, a bUSiness Plan should be presented showing:how and. when.the facilitY Will serve the public~ 3, HaUl a proportionate share of reject material frOm the curbside greenwaste so~ng operation, accOrding to the amounts, of greenwaste brought to the The greenwaste cart Program is prone'to contamination by m'Sidents'putting ' traSh'in the green'carts. The Cityhas an incentive to. maintainpressum:on~the reSidents'to'adhere to rules~ HOWever, the contractors.service both' City' and coUnty~a~; and althOUgh the Cityrefuse Ccontmct requims'the'cont~ctor to reduce contamination, a proper'.incentive'would be for the Contractor tobear the Cost of hauling the reject matedaL We lOOk.forWard to working with youto work out the details:for these imatters and proceSS an extension of the hauling contract: Sincerely.: · '/" Paul Rojas PubliC Works Director C: Alan Tandy BAKEI~.$FIEI~Di CA'9;~309 'Fax'(66~, i ,;(52;~.l ~'4 ADMINISTRATIVE REPORT MEETING DATE: April 5, 2006 I AGENDA SECTION: Consent Calendar I ITEM: ID., i. TO: . Honorable Mayor and City Council APPROVED FROM: Nelson K. Smith, Finance Director DEPARTMENT HEAD ,,,,V'.~' DATE: March 14, 2006 CITY ATTORNEY. CITY MANAGER SUBJECT: A Policy Resolution Adopting a Revised Land Based Financing Policy. RECOMMENDATION: Budget and Finance Committee recommends adoption of the Resolution. BACKGROUND: The City has recently entered into development agreements with local land owners associated with the Old River Ranch and Rosedale Ranch projects. The City also entered into a pre- annexation agreement with Sun Cai regarding the McAllister Ranch project. Each of these agreements includes a commitment by the City to provide a mechanism for financing public facilities and/or services commonly known as Community Facilities Districts (CFD); also known as Mello-Roos Financing. Community Facility Districts provide developers with an optional financing mechanism to fund public facilities and services. A special tax is placed on the properties within the district, generally associated with the repayment of debt incurred by the district to fund the public improvements. In order for the City to be able to provide this type of financing to these developers the City needs to adopt an ordinance alloWing for the formation of CFD's, and a policy document regarding CFD's to establish some perimeters and guidelines for the districts. The ordinance document was reviewed by the Budget and Finance Committee at their February 8, 2006 Committee meeting; had first reading at the February 22, 2006 Council meeting, and the ordinance (#-4314) was adopted by Council at their March 8, 2006 meeting. The Building Industry Association (BIA), along with representatives from the Old River Ranch and McCallister Ranch developments have provided input and suggestions regarding the policy document. While not all of their requests were included in the policy document, many of their suggestions were incorporated into the document. The Budget and Finance Committee reviewed the draft policy document at their March 8, 2006 committee meeting and recommended the draft policy be forwarded to the City Council for their consideration and approval. nks P:\Comm Facil Districts~dmin - cfd policy.doc Feb. 24, 2006 POLICY RESOLUTION NO. A RESOLUTION ADOPTING A REVISED LAND BASED FINANCING POLICY WHEREAS, the City Council had adopted an Assessment District Policy on March 19, 1986; and WHEREAS, the City Council amended the Assessment District Policy on June 14, 1995 (Res. 86-95) to include a 4 to 1 value to lien ratio district wide in addition to the3 to 1 value to lien ratio per parcel; and WHEREAS, the City has entered into development agreements to provide Community Facility District financing to developers; and WHEREAS, in order for the City to provide Community Facility District financing for said developers, the City must adopt an Ordinance and a Policy regarding the formation of Community Facility Districts; and WHEREAS, the City Council adopted an Ordinance (#4314) regarding formation of Community Facility Districts at the March 8, 2006 Council meeting; and WHEREAS, Community Facility Districts and Assessment Districts are both considered Land Based Financing mechanisms and as such, the City .desires to combine the existing policy guidelines for Assessment Districts ~nto one policy document that addresses issues associated with both Community Facility Districts and Assessment Districts; and 'WHEREAS, the Budget and Finance Committee of the City of Bakersfield has reviewed the draft combined policy document at their March 8, 2006 committee meeting, recommending it be forwarded to the full Council for their consideration and approval. NOW, THEREFORE, BE IT RESOLVED by the Council of the Cify of Bakersfield as follows: 1. The above recitals are found to be true and correct. 2. The City shall use the attached Land Based Financing Policy as a guideline for establishing AssessmentDistricts and Community Facility Districts 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: CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED HARVEY L. HALL MAYOR ofthe Ci~ of Bakersfield APPROVED as to form: VIRGINIA GENNARO CITY ATTORNEY of the City of Bakersfield 'CITY OF BAKERSFIELD LAND SECURED FINANCING POLICIES Prepared by: Finance Department February 27, 2006 CITY OF BAKERSFIELD LAND SECURED FINANCING POLICIES TABLE OF CONTENTS ,pa.qe Definitions Statem-''-Yen[ ............................................................................. 2 Introductory Eligible Public' Facilities ........................................................................ 4 Eligible Public Services Financing Priorities Right of Way Acquisitions Value-To-Lien Credit Enhancements ' 7 Security Special Tax Formula ........................................................................ 9 Terms and Conditions of Bonds 10 District Cost Deposits and Reimbursements ........................................11 Agreements .......... 13 Acquisition Provisions ........................................................................ 14 Disclosure to Purchasers ........................................................................ 14 Property Owner Support ........................................................................ 14 Land Use Approvals ......... Exceptions to These Policies .............................. : ................................ 15 Attachment: Form of Application for Land-Secured Financing _]_ City of Bakersfield Land Secured Financing Policies Definitions Unless the context otherwise requires, the terms employed in the following policies shall have the meanings specified below: "Assessment Acts" me~ns the Improvement Bond Act of 1911 and/or the Municipal Improvement Act.of 1913 and/or the Improvement Bond Act of 1915; the Landscaping and Lighting Act of 1972; the Benefit Assessment Act of 1982. "Bonds" means bonds authorized and issued under the Mello-Roos Act or Improvement Bond Act of 1915. "Bulk Sale Value" means the most probable'price, in a sale of all parcels within a tract or development project, to a single purchaser or purchasers, over a reasonable absorption period, discounted to a present value, as of a specified date, in cash or in terms equivalent to cash, for which the property rights should sell after reasonable exposure, in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgably and for self-interest, and assuming that neither is under undue stress. "City" means the City of Bakersfield. "Discounted Cash Flow" means the measurement of the cash flows associated with the development and sale of real estate parcels, based on an independent judgment of the prices and times at which individual parcels or properties would be sold, after applying a discount rate to such cash flows to reflect the risk-adjusted rate of return necessary to attract the debt and equity investment necessary to undertake and complete the acquisition, entitlement, development and sale of the parcels or properties. "District" means a Community Facilities District (CFD) formed under the Mello-Roos Community Facilities Act of 1982 or an assessment District formed under the ImProvement Act of 1911 or the Municipal Improvement Act of 1913. "Lien" means, in the case of public debt imposed on a parcel or parcels, the aggregate amount of debt attributable to such parcel, as measured by an assessment engineer; or, in the case of Mello-Roos Community Facilities District debt, the amount of debt attributable to a parcel or parcels, based on an apportionment of the debt to such parcel or parcels in relation to the probable debt service to be borne by such parcel or parcels. -2- "Public Facilities" means improvements authorized to be constructed or acquired under the Mello-Roos and Assessment Acts including, but not limited to, fees for capital facilities imposed by public agencies as a condition to approval of the development encompassed by the District or as a condition to service the District. "Public Services" means any one or combination of the following: police protection serviceS; jail, detention facility, and juvenile hall services; fire protection and suppression services; ambulance and paramedic services; maintenance of parks, parkways and open space; flood and storm protection services, including, but not limited to, the operation and maintenance of storm drainage systems, and sandstorm protection services; or environmental cleanup and remediation services. "Value" or "Fair Market Value" means the amount of cash or its equivalent which property would bring if exposed for sale in the open market under conditions in-which neither buyer nor seller could take advantage of the exigencies of the other and both have knowledge of all of the uses and purposes to which the property is adapted and for which it is capable of being used and of the enforceable restrictions upon uses and purposes. "Value,to-lien ratio" means a calculation to measure the number of times the value of a property (gross retail value after improvements funded by the district) exceeds the sum of its assessment liens, including the proposed assessment and any existing assessments, special taxes or other encumbrances. Introductory Statement The City of Bakersfield (the "City") will consider developer or property owner initiated applications requesting the formation of Assessment Districts and the issuance of bonds to finance eligible public facilities necessary to serve newly developing or existing residential, commercial and/or industrial projects under the conditions set forth herein. Developers may apply for Community Facilities District (CFD) financing of eligible public facilities and/or services necessary to serve newly developing residential, commercial and/or industrial projects, but only in the following instances: ~1. The tax-exempt financing of project public facilities will result in a clear public benefit, as such public benefit is determined by the City; AND 2. The City has negotiated and executed.a development agreement (or similar agreement) addressing project implementation and providing for financing of all required public infrastructure and public safety services, including all facilities and services as listed in the Assessment Acts and Mello-Roos Community Facilities Act of ~1982 or approved zoning or site plan approval. Project applicants without a negotiated and executed development agreement (or similar agreement) may apply for assessment District financing only. -_3- The above criteria will be applied by the City staff with final determination and findings to be made by the City Council. Generally, facilities providing a significant public benefit, such as collector and arterial streets and highways, state highways and bridges, freeways and freeway interchanges, railroad crossings, traffic signals, parks and open space acquisitions, public works facilities (including water, wastewater, storm drainage processing and distribution systems), community facilities (including youth facilities, sports complexes, libraries, bikeways and community/youth centers), public safety facilities (including police and fire facilities), public safety services (including police and fire operating costs), library facilities and services, and Other appropriate public facilities will be eligible for this program. Facilities and services will be finanbed in accordance with the provisions of the Assessment Acts, or the Mello-Roos Community Facilities Act of 1982. Each time a CFD or Assessment District is formed for the benefit of a development project, the City may require the creation of a maintenance diStrict. The maintenance district may be established pursuant to the provisions of the Landscaping and Lighting Act of 1972, or such other provision of state law or appropriate local code or charter provisions, and will serve for the purpose of paying for any unfunded on-going City maintenance costs associated with the development project. All City and consultant costs incurred in the evaluation of new development, District applications and the establishment of Districts .must be paid by the applicant(s) by advance deposit increments. The City will not incur any non-reimbursable expense for processing assessment District or a CFD. Expenses not prepaid and chargeable to the District shall be solely for the account of the applicant. ,EliRible Public Facilitie-~ Facilities to be financed must be public facilities for which the City, or a public agency as determined appropriate by the City, will be the owner or will have normal operating and maintenance .responsibility. The types of facilities eligible to be financed include, but are not limited to: A. Streets, roads and highways 1. Arterial roads and state highways 2. Collector streets, as determined by the 'City 3. Bridges and freeway interchanges 4. Traffic signals and railroad crossings, including grade separations 5. Canal and river crossings B. Parks, open space and community facilities 1. Youth facilities, youth centers, community facilities, child care facilities 2. Sports facilities and complexes 3. Bikeways -4- 4. Parks and recreational facilities 5. Multi use trails C. Public safety facilities 1. Police stations, sub-stations, and other facilities 2. Fire stations and facilities. D. Public works facilities 1. City owned and operated Water and wastewater treatment, storage and conveyance facilities 2. Storm drainage facilities 3. Natural gas pipelines, telephone lines, facilities for transmission and distribution of water or electrical energy, and cable television lines (includes public, PUC-regulated and municipal facilities). The aforementioned list may not be exhaustive. For a complete list of eligible facilities,. please refer to the current version of the Municipal Improvement Act of 1913, Improvement Bond Act of 1915, and the Mello-Roos Community'Facilities Act of 1982. In the case where any public or private utility facilities are funded with District proceeds, any future reimbursements related to said facilities shall be credited to the District and to the benefit of the property owners at the time said funds are' received by the City. These funds will generally be used to reduce District debt in the form of bond calls. Should said reimbursements continue beyond the life of the District, said funds will become property of the City and used for ongoing maintenance of other public facilities funded by District proceeds. The City will retain final determination as to any facility's eligibility for financing, as well as the prioritization of facilities to be included within a District financing. Use of bond proceeds for grading and right-of-way acquisition will be reviewed by the City and bond counsel on a case-by-case basis. Generally, "in-tract" improvements will not be considered eligible, unless specific circumstances and credit conditions warrant such inclusion. Applicant will be eligible for reimbursement for all soft costs relative to construction of eligible facilities, including but not limited to design and engineering costs, as to be defined in the deposit and reimbursement agreement. Eliqible Public Services Services to be financed through a CFD must be public services for which the City provides, and would include both staffing costs (salary and benefits) and normal operating costs of providing such services. The types of services eligible to be financed are: ~ A. Police protection services B. Fire protection and suppression services C. Jail, detention facility, and juvenile hall services -5- D. Ambulance and paramedic services E. Services and maintenance of parks, parkways and open space F. Flood and storm protection services, including, but not limited to, the operation and maintenance of storm drainage systems, and sandstorm protection services G. Environmental cleanup and remediation services (including hazardous substances). H. Library services. Financinq Priorities It is the City's view that a comprehensive policy toward mitigating the service impacts of growth is the best way to foster cooperation in allocating available debt capacity. Therefore, it is the City's intent to work closely with local school districts (and any other public agencies with District creating authority) to ensure that the maximum tax rate is not exceeded and homeowners are not overburdened. In order to ensure that public financing is used in a comprehensive, organized way consistent with the City's General Plan and these Policies, the aforementioned eligible public facilities are prioritized below: Ist City Facilities and services needed to serve a community plan area that is Priority currently deficient in off-site infrastructure needed to develop the area as planned; that is "backbone" public infrastructure to support already approved community plan areas. 2na Other public facilities and services for which there is a clearly demonstrated Priority public benefit. 3ra Other public facilities and services permitted by the Acts. Priority Generally speaking, the City would give higher priority to any City owned public facilities and any financial terms or conditions specifically outlined in a Development Agreement. Non-City-Owned public facilities and related costs would generally be of secondary priority. The City reserves the right to make exceptions to these priorities when circumstances warrant (the City is consciously establishing no priority for the use of the Acts in the case of populated areas and registered-voter elections). RiRht-ofWay Acquisitions Right-of-way needed for streets purposes will be acquired through the District or dedicated as a street easement by the property owner. If the right-of-way is acquired, the total cost of the acquisition shall be based upon an amount no greater than the value of the property acquired, including any severance damages. The cost of a right- of-way acquisition for a specific property will be assessed back to such property in accordance with the assessment spread methodology (for Assessment Districts) -6- described in the engineer's report prepared fOr the District. If a property owner dedicates in lieu of monetary payment, a property owner can do so only prior to the end of the cash collection period. This section will not apply to any property owner within the District required to dedicate street right-of-way as a condition of an approved · development entitlement, since the property owner does not receive monetary payment for the dedication, unless the acquisition of right-of-way provides funding for a public purpose as approved by the City. Value-To-Lien ._ The City requires a District-wide value-to-lien ratio of at least 4:1 for the District. The District (or improvement area) property value-to-lien ratio for each individual parcel within the District shall be at least 3':1. Therefore, the value-to-lien ratio for any particular individual parcel within a District can be less than 4:1 (but must be at least 3:1 ) as long as the overall valuation of the District is at least 4:1. Valuations shall be determined based upon an appraisal of the proposed District properties. Assessed valuation data from the County of Kern may be used for valuation purposes in lieu' of an appraisal report, at the discretion of the City. The appraisal shall be coordinated 'by and under the direction of the City. All costs associated with the preparation of the appraisal report shall be paid by the applicant through the advance deposit mechanism. The appraisal shall be conducted by an MAI appraiser in accordance with criteria .established by the City, based upon the recommendations received by the City from its bond counsel and/or financial advisor. In every case, the appraisal shall employ either a discounted cash flow or utilize bulk sale comparables and shall fully conform to published guidelines set forth in the Appraisal Standards for Land Secured Financings published by the California Debt and Investment Advisory Commission ("CDIAC Guidelines"), originally dated May 1994 and modified July 2004. However, notwithstanding the foregoing sentence, if a conflict exists between the CDIAC Guidelines and the corresponding definitions, standards, or assumptions in the Uniform Standards of ProfeSsional Appraisal Practice of the Appraisal Foundation (USPAP"), USPAP shall govern. The City shall have discretion to retain a consultant to prepare a report to verify market absorption assumptions and projected sales prices of the properties which may be subject to the maximum special tax or assessments in the DistriCt. Such a report may be used by appraisers in determining the value of property to be assessed or taxed. Credit Enhancement Owners of the property who are deemed responsible for 33% or more of the debt service obligation of the bond issue may be required to provide a letter of credit or cash deposit equal to two years' special taxes or assessments on their property. The letter of credit may be drawn on if and to the extent that the landowner is delinquent in paying its special taxes or assessments. Upon receipt of a request of a property owner who has provided a letter of credit or cash deposit pursuant to the first sentence of this -7- paragraph, which request shall be accompanied by documentation in Support of such request, the City will review such request to determine (a) the percentage of annual special tax or assessment payment obligation applicable to property owned by the property owner submitting the request and (b) the annual amount of special taxes or assessments applicable to such property; provided that such requests shall not be submitted more frequently than such property owner is' providing reports pursuant to a continuing disclosure undertaking under SEC Rule 15c2-12. If the City determines, based on its review of the infOrmation submitted, that the percentage has fallen below 33%, the City shall notify the property owner and release the letter of credit or return the cash deposit, as the case may be. If the City determines that such percentage remains at 33% or above but that the amount of two years' special tax or assessment payment obligation has decreased, the City shall either notify the property owner and cooperate with the property owner in obtaining a reduction of the amount of the letter of credit or reducing the amount of the cash deposit, as the case may be. The City may, at its discretio.n, require additional credit enhancement to increase'the credit quality of any CFD / Assessment bond issue. Credit enhancements may be required in additional situations where there is an insufficient value to lien ratio, a substantial amount of property in the district is undeveloped, tax delinquencies are present on parcels within the District, and in any other situation as required by the City. As a practical matter, such additional requirements will generally be the result of recommendations made by the City's bond counsel, financial advisor, bond underwriter, or other members of the City's financing team. The form of credit enhancement is subject to the approval of the City and the City shall impose specific requirements (including but not limited to an absorption study) with respect to such credit enhancement on a case-by-case basis. The City retains the right to withhold public financing if it determines that such financing is detrimental to its credit rating or to the issuance of other City-planned, land-seCured debt. Security For new development, the applicant or property owner must demonstrate its financial plan for the property within the District and ability to pay all assessments and/or special taxes during the bUild-out period. Additional security such as credit enhancement may be required by the City in certain instances. If the City requires letters of credit or other security, the credit enhancement shall be issued by an institution in a form and upon terms and conditions satisfactory to the City. All fees payable on the letter of credit or other security shall be the sole responsibility of the applicant or developer, not the City or District. Any security required to be provided by the applicant shall be discharged by the City upon the opinion of a qualified appraiser retained by the City, that specific release thresholds have been reached. -8- Special Tax Formula For Mello-Roos Community Facilities Districts ("CFDs"), the assigned special tax submitted to the qualified electors of the CFD shall not exceed nine-tenths of one percent (0.9%) of the estimated base sales price of the subject properties' at the time of CFD ,formation. Furthermore, the total of the following burdens, when taken in the aggregate, may not exceed two percent (2%) of the estimated base sales price of the subject properties: A. Ad valorem property taxes levied by the County. B. Voter approved ad valorem taxes levied by the County in excess of one percent (1%) of the estimated base sales price for each unit. C. Special taxes levied by any existing CFD for the payment of bonded indebtedness or on-going services. D. Assessments levied by the City for residential garbage service, residential sewer service, median landscape districts and parks maintenance districts. E. Assessments levied for any assessment district or maintenance district for the payment of bonded indebtedness or services and, F. The aSsigned special tax for the proposed CFD. The special tax formula shall adhere to the following requirements: A. The maximum special tax shall include customary and reasonable annual administrative costs of the City to administer the District (A portion of these costs may be established as superior in lien position to the debt service). ?:-... B. The special tax formula shall not include escalator rates allowing annual tax increases above the maximum special tax established upon District formation. C. The maximum special tax shall establish for undeveloped land, tax rates corresponding to the adopted land use designations on each parcel. Undeveloped land shall be taxed at rates equal to developed properties of the same land use designation. D. The City shall have discretion to allow a special tax in excess of the established limits for any lands within the CFD which are designated as commercial or industrial. -9- E. For residential districts; once property sales to homeowners actively commences, the City will not take any actions to modify the established special tax formula that would cause an increase of the special tax on residential properties. Proposed actions that would reduce the special tax on residential properties will be considered on a case-by-case basis. The City shall retain a special tax consultant to prepare a report which: A. Recommends a special tax method for the proposed CFD, and B. Evaluates the special tax proposed to determine its ability to adequately fund identified public facilities, City administrative costs, services (if applicable) and other related .expenditures. Such analysis shall also address the resulting aggregate tax burden of all proposed special taxes plus existing special taxes, ad valorem taxes and assessments on the properties within the CFD. Terms and Conditions of Bonds All terms and conditions of the bonds shall, be established by the City. The City will control, manage and invest all District issued bond proceeds. Unless otherWise authorized by the City, the following shall, serve as bond requirements: A. A reserve fund shall be set at the lesser of the three tests: i. 10% of par amount, ii. maximum annual debt service, or iii. 125% of average annual debt service. B. The special taxes or assessment liens shall be levied for the first fiscal year following sale of the bonds for which they may be levied. Interest may be capitalized for up to 24 months. C. The repayment of principal shall begin on the earliest principal payment date for which sufficient special tax or assessment revenues can be made available. The term of any given bond issue will be set by the Finance Director, in consultation with the applicant(s) and the bond underWriter, and will be in relation to the relative size of the particular bond issue. The City prefers most District bond issues to be in the 20 year to 30 year range. In any case, the maximum term of bond issue shall not exceed 35 years. D. The City has established the minimum amount of public improvement bonds financed to be not less than two (2) million dollars construction cost ']0- per bond issue. Multiple applicants may be merged together into one District, at the City's discretion, to meet this minimum requirement. E. Beginning with the commencement of the repayment of principal, annual debt service shall be level. F. For assessment Districts, the bonds shall be callable on any interest payment date. For CFD's, the bonds shall be callable on interest payment dates as structured at the time of sale. Any call premium structure shall be established based on market conditions at the time bonds are sold. G. The maximum special tax shall be established to assure that the annual revenue produced by levy of the maximum special tax shall be equal to at least 110% of the average annual debt service. H. All statements and documents related to the sale of bonds shall emphasize and state that (i) the Bonds are limited obligations of the City and neither the faith, credit nor the taxing power of the City is pledged to security or repayment of the bonds, (ii) the sole source of revenues are assessments and/or special taxes, the debt service reserve fund or proceeds raised by foreclosure proceedings, and (iii) the City shall not be obligated to make payments of principal, interest or redemption premiums (if any) from any other source of funds. In general, advance refundings of outstanding bonds for economic savings will be considered on a case-by-case basis, but only when net present value savings of at least five percent (5%) of'the refunded debt can be achieved. Refundings with savings of less than five percent (5%), or with negative savings, will not be considered unless there is a compelling public policy objective, as determined by the City. The measurement of the 5% savings may, but is not required to, consider other benefits to the City, other than the proposed bond transaction, if deemed appropriate by the City. District Cost Deposits and Re.imbursement~ All City and consultant costs incurred in the evaluation of District applications and the establishment of Districts will be paid by the applicant by advance deposit increments. Except for those applications for assessment Districts or CFD's where the City is the applicant, the City shall not incur any non-reimbursable expenses for processing and administering applicant initiated assessment Districts or CFD's. Expenses not chargeable to the District shall be directly borne by the applicant. Each application for formation of an assessment District or CFD shall be accompanied by an initial deposit in the amount determined by the City's Public Works Department to fund initial staff time and consultant costs associated with District review and implementation. No work will be initiated by City staff until the initial deposit is received by the City. If additional funds are needed to off-set' costs and expenses incurred by the -]] _ District, the City shall make written demand upon the applicant for such funds and the applicant shall comply with each demand within ten (10) business days of receipt of such notice. If the apPlicant fails to make any deposit of additional funds for the proceedings the City may suspend all proceedings until receipt of such additional deposit. The deposits shall be used by the City to pay for actual costs and expenses incurred by the City relative to the proceedings, including but not limited to, legal, engineering, appraisal, special tax consultant and financial advisory expenses; documented City staff time, administrative costs and expenses; required notifications; and printing and publication of legal matters. The applicant may request deposit terms and conditions to be defined by a deposit and reimbursement agreement to be executed by the applicant and the City. Upon such request, the City will place this agreement on the City Council agenda, as soon as practical after receipt of application. The district shall refund any unexpended portion of the deposits upon the following conditions: A. The District is not formed; B. Bonds are not issued and sold by the District; C. The proceedings for formation of the District or issuance of bonds is disapproved by the City; or D. The proceedings for formation of the District or issuance of bonds is abandoned in writing by the applicant. E. The formation of the District and the issuance of bonds as set forth below a. Except as otherwise provided herein, the applicant shall be entitled to reimbursement for all reasonable costs and expenses incident to the proceedings and construction of the public facilities as provided under the Mello-Roos Community Facilities Act of 1982 or the Municipal Improvement Act of 1911 or 1913 and the Improvement Bond Act of 1915, provided that all such costs and expenses shall be verified by the City as a condition of reimbursement. The applicant or property owner shall not be entitled to reimbursement from bond proceeds for any of the' following: A. In-house administrative and overhead expenses incurred by the applicant, or expenses of applicant's counsel or consultants; and -]2- B. Interest expense incurred by the applicant on moneys advanced or expended during the proceedings and construction of public facilities; The City shall not accrue or pay any interest on any portion of the deposit refunded to the applicant or the costs and expenses reimbursed to the applicant. Neither the 'City nor the District shall be required to reimburse the applicant or property owner from any funds other than the proceeds of bonds issued by the District. Excess funds on deposit after the formation of the proposed District will be refunded to the depositor. A.qreements The applicant shall provide drafts of all necessary agreements incident to District proceedings in a form satisfactory to the City and consistent with these policies. City bond coUnsel will determine and approve the final form of all District agreements. These agreements shall include, but are not limited to: A. Development Agreement B. Reimbursement Agreement C. Agreements with any other public agency entitled to receive any portion of the bond proceeds or entitled to own and/or operate any of the public facilities financed by the bond proceeds. As a condition to the issuance and sale of the bonds, all of the agreements specified shall be duly approved and executed by the parties thereto. Prior to execution of any agreements, such agreements shall be reviewed by bond counsel and the City Attorney and approved by the City Council. Use of Consultants The City shall select all consultants necessary for the formation of the district and the issuance of bonds, including the underwriter(s), bond counsel, disclosure counsel, financial advisor, assessment engineer, appraiser, market study consultant, and the special tax consultant. Prior consent of the applicant shall not be required in the determination by the City of the consulting and financing team. However, the applicant may make recommendations to the City on an advisory basis in their application. No firm may serve as both design engineer and engineer of work and assessment engineer or special tax consultant on the same District. -];3- No law firm may serve as bond counsel if any 'project proponent has engaged such firm at any time during the three-year period immediately preceding the formation of the proposed District. No law firm may serve as both bond counsel and disclosure counsel. ,Acquisition Provisions The City is generally opposed to developer initiated construction Districts. The City shall have final determination as to whether it will allow the financing of public facilities through construction as opposed to acquisition, and will grant rare exceptions where an overriding justification exists concerning public benefit, safety or health. Such waiver shall be subject to City council approval. The City and the applicant or property owner shall mutually agree upOn facilities to be acquired and the method of determining reasonable acquisition costs. A funding and acquisition agreement shall be required and approved by the. City Council on or prior to the adoption of the Resolution of Intention to form the District.' The applicant will be expected to have all improvements completed within three years from the date bOnds are sold. Reimbursement requests should be filed with the City prior to the expiration of this three year period. Disclosure to Purchasers The applicant or property owner will be required to demonstrate to the satisfaction of t.he City that there will be full disclosure of this and any other special tax, assessment or other liens on individual parcels of which the seller or lessor has knowledge to existing and future property owners. In addition to all requirements of law, the City shall require the applicant to provide disclosure of such information as the City deems appropriate to the purchasers of property within the District, with respect to the existence of the District, amounts of special taxes to be levied within the District and the terms and conditions of bonds issued on behalf of the District. Such disclosure shall take place prior to sale, and may include homebuyer notifications requiring signature prior to home sales, as well as methods to notify subsequent hOme purchasers. Property Owner Support In the instance of multiple property owners, the District applicant shall be required to produce letters evidencing other property owner support for the scope and establishment of the District as an attachment to the District application. The City will require that developer initiated Districts have concurrence of not less than two-thirds of the property owners to be included in the proposed District, unless there is an overriding need for the public facilities, or the applicant is willing to separately fund the facilities on the non-participating property(s). The City reserves the right to require demonstration of a greater or lesser degree of public support for the formation of proposed multiple property owner Districts. - ]4- Land Use Approvals Proposed District properties must Possess a land use determination such that proposed development land uses and specific facility requirements can be adequately assessed. The City will accept applications for assessment and/or Mello-Ro°s financing only when properties to be included within a proposed District have City approved zoning or site plan approval. The City will also accept applications for District financing from applicants whose properties are included in an approved DevelOpment Agreement. Exceptions to These Policie~ The City reserves the right to amend ·or modify these policies at any time as well as to make exceptions or changes for specific financing projects, as facts or circumstances so warrant. The City may find in limited and exceptional instances that a waiver to any of the above stated policies is reasonable given identified special City benefits to be derived from such waiver. Such waivers are granted only by action of the City Council and based upon specific public purpose and/or health and safety findings. p:nks/cfd/land based policy as revised feb 27 2006.doc -]5- ADMINISTRATIVE REPORT MEETING DATE: March 8, 2006 AGENDA SECTION: Consent Calendar ITEM: [c,3.. ~. TO: Honorable Mayor and City Council APPROVED FROM: Nelson K. Smith, Finance Director DEPARTMENT HEAD ,,~_~ DATE: February 24, 2006 CITY ATTORNEY ,~ CITY MANAGEI~ ~ / SUBJECT: Adoption of an Ordinance of the City of Bakersfield, Adding Chapter. 13.10 to the Bakersfield Municipal Code, to establish certain procedures respecting special tax districts. RECOMMENDATION: Staff recommends motion to adopt the ordinance. BACKGROUND: The City has recently entered into development agreements with local land owners associated with the Old River Ranch and Rosedale Ranch projects. The City also entered into a pre- annexation agreement with Sun Cai regarding the McAIlister Ranch project. Each of these agreements includes a commitment by the City to provide a mechanism for financing public facilities and/or services commonly known as Community Facilities Districts (CFD); also known as Mello-Roos Financing. Community Facility Districts provide developers with an optional financing mechanism to fund public facilities and services. A special tax is placed on the properties within the district, generally associated with the repayment of debt incurred by the district to fund the public improvements. In order for the City to be able to provide this type of financing to these developers the City needs to adopt an ordinance allowing for the formation of CFD's. The City will also need to adopt a policy document regarding CFD's to establish some perimeters and guidelines for the districts. City staff are working with the Building Industry Association (BIA), local developers, outside bond counsel and financial advisors to develop the draft policy. We expect to present the draft policy document to the Budget and Finance Committee at their March 2006 meeting date. After their review, the policy document will come before the full Council for their consideration. The draft ordinance document was reviewed by the Budget and Finance Committee at their February 8, 2006 meeting. The Committee recommended that the draft ordinance be forwarded to the full Council for first reading. First reading of the ordinance was approved by City Council at the February 22, 2006 meeting date. nks S:~KJrnG~Nelson~Admin - cfd ord 2nd read.doc Feb. 24, 2006 ORDINANCE NO. ' AN ORDINANCE OF THE CITY OF BAKERSFIELD, ADDING CHAPTER 13.10 TO THE BAKERSFIELD MUNICIPAL CODE, TO ESTABLISH CERTAIN PROCEDURES RESPECTING SPECIAL TAX DISTRICTS. BE IT ORDAINED' by the Council of the City of Bakersfield as follows: SECTION 1. Chapter 13.10 is hereby added to 'the Bakersfield Municipal Code to read as follows: CHAPTER 13.10 SPECIAL TAX DISTRICTS Sections: 13.10.010 Authority. 13.10.020 Title. 13.10.030 Definitions. 13.10.040 Nonexclusivity. 13.10.050 Conflict of Law. 13,10.060 Nature of Districts. 13.10.070 Construction. 13.10.080 Incorporation of the Mello-Roos Act. 13.10.090 Compliance with'Chapter. 13.10.100 Extraterritorial Jurisdiction. 13.10.110 Adopting goals and Policies. 13.10.120 Authorized Services. 13.10.130 Authorized Facilities. 13.10.140 Services Existing Before District Formation. 13.10.150 Lease of Facilities. 13.10.160 Joint Community Facilities Agreement or Joint Exercise of Powers Agreement. 13.10.170 Hearing, Continuances. 13.10.180 Special Tax Levy Election. 13.10.190 Public Agency as Qualified Elector. 13.10.200 Refunding Bonds, Use of Savings. 13.10.010 Authority. The city is a municipal corporation, organized and existing under its Charter and the State constitution, with the power to make and enforce all laws and regulations 1 of 8 respecting municipal affairs,' subject only to any restrictions and limitations provided in the Charter and in the State constitution. The Council finds and declares that providing for special tax districts, to finance certain facilities and services, is necessary, essential, 'a public purpose, and a municipal affair of the city. 13.10.020 Title. This chapter may be cited as the City of Bakersfield Specia Tax Financing Law. 13.10.030 Definitions. Unless the context otherwise requires, the following definitions shall govern the construction of this chapter. a. "District" means any special tax distriCt formed pursuant to this chapter. b. "Facilities" means any or all facilities that a district may finance, purchase, construct, expand, improve, or rehabilitate pursuant to Government Code Section 53313.5. c. "Mello-Roos Act" means the Melio-Roos Community Facilities Act of 1982 (Chapter 2.5, commencing with Section 53311, of Part I of Division 2 of Title 5 of the Government Code, as amended from time to time). Government Code Sections referenced in this chapter shall mean that Section as amended from time to.time. d. "Private residential purposes," when considering property use, shall not include property used primarily for hotel or residential hotel purposes. Such property shall be deemed used for commercial and nonresidential use. e. "Services" means any or all of the following: 1. Maintaining, servicing, or replacing (aa) any street, highway, road, alley, lane, boulevard, pedestrian mall, parkway, bike path, trail easement, or other way 2 of 8 dedicated to public use or used by the public and (bb) all appurtenances and improvements therein including, but not limited to, medians, street signs, other Signage, street lights, traffic signals, hydrants, soundwalls, drains, tunnels, sewers, curbs, gutters, sidewalks, conduits, culverts, and channels .for drainage purposes, with necessary outlets, cesspools, manholes, catch basins, flush tanks, septic tanks, disposal plants, connection sewers, ditches, drains, conduits, channels, landscaping, and hardscaping, 2. Maintaining or servicing any lakes, streams, rivers, creeks, channels or other bodies of water and the streambeds, riverbeds, creekbeds, channelbeds or lakebeds, or replacing infrastructure necessary to maintaining or servicing any of the foregoing. 3. Maintaining, servicing, o~ replacing any landscaping, hardscaping, lighting or signage next to any right-of-way or other way dedicated to public use or used by the public and described in' (1), above, or next to any canal, basin, or ditch. 4. Establishing and maintaining a reasonable reserve for replacement under (1) through (3), above. The reserve for replacement shall be a service cost or expense and shall not be deemed payment for public facilities under Government Code Section 53321(d) when the property subject to the special tax is used for private residential purposes. 5. Maintaining health and safety services including, without limitation, police, fire, traffic signal contr.ol, and recreational services. 6. Maintaining, caring for, or preserving any facilities defined in this chapter.' 7. Any other services allowed pursuant to Section 53313 of the Government Code. 3 of 8 13.10.040 Nonexclusivity. The procedures provided in this chapter are not exclusive, but are alternative to any other procedures provided in this Code or under State law. 13.10.050 Conflict of Law. This chapter is to be read and construed with the incorporated Mello-Roos Act. In any conflict between this chapter and th'e provisions of the Mello-Roos Act, this chapter shall govern. 13.10.060 Nature of Districts. Districts created pursuant to this chapter shall be deemed financing districts and not separate governmental agencies distinct from the city. 13.10..070 Construction. This chapter shall be liberally constructed. 13.10.080 Incorporation of the Mello-Roos Act. The Mello-Roos Act is. incorporated in and made a part of this chapter. Except as otherwise provided by this chapter, the mode and manner for financing facilities, for levying and collecting special taxes, and for issuing bonds shall be as prescribed in the Mello-Roos Act. 13.10.090 Compliance with Chapter. Any proceedings taken, special tax levied, or bonds issued pursuant to this chapter shall not be held invalid for failure to comply with the provisions of this Chapter provided such failure is not a constitutional defect. 13.10.100 Extraterritorial Jurisdiction. Any district may be created pursuant .to this chapter within the 'territorial jurisdiction of the city or, upon compliance with the procedures set forth in Streets and 4 of 8 Highways Code Sections 5115 through 5118, may extend beyond the territorial limits of the city. 13.10:110 Adopting Goals and Policies, The city may initiate proceedings to establish a district or to annex territory to a district pursuant to this chapter without first considering and adopting goals and policies. Establishing goals and polices as provided in Government Code Section 53312.7, concerning the adoption of local goals and policies, shall be permisSive and not mandatory to initiating proceedings pursuant to this chapter. 13.10.120 · Authorized Services. A district special tax, whether approved by vote of landowners or registered voters, may finance services specified in the Mello-Roos Act or services as defined in this chapter. Services financed may supplant services already available in the territory when the district is created or when the territory is annexed to a district. 13.10.130 Authorized Facilities. A district special tax, whether approved by vote of landowners or registered voters, may finance facilities specified in the Mello-Roos Act or facilities as defined in this chapter. Facilities financed may supplant facilities already available in the territory when the district is created or when the territory is annexed to a district. 13.10.140 Services Existing BefOre District Formation. Notwithstanding Government' Code Section 53313, a special tax imposed pursuant to this chapter may finance any facilities or services authorized in this chapter, which .were being provided in the territory of the district before the district Was created or the territory annexed. The special tax imposed may finance facilities or services that are in addition to existing facilities or services, or that supplant existing facilities or services. 5 of 8 13.10.150 Lease of Facilities. Notwithstanding Government Code Section 53313.5, the city may leas'e out facilities financed pursuant to this chapter if the Council determines that it is in the best interest of the city to do so. 13.10.160 Joint Community Facilities Agreement or Joint Exercise of Powers Agreement. Notwithstanding Government Code Section 53316.2(b), the city, at any time, may enter a joint community facilities agreement with any local agency or public agency, or a joint exercise of powers agreement with any local agency. 13.10.170 Hearings, Continuances. The. hearing on the proposed formation of a district as required by subdivision (e) of Government Code Section 53321, and the hearing on a proposed anneXation to an existing district as required by subdivision (f) of Government Code Section 53339.'3, shall be held not less than 10 or more than'60 days after the'date that the Council adopts the resolution of intention to establish the district, or to annex territory, and may be continued from time to time without further notice, but shall be completed within one year of the original hearing date. 13.10.180 Special Tax Levy Election. The Council shall submit the levy of any special taxes to the qualified electors of the propos'ed district or to the qualified electors of the territory to be annexed to the district in the next general ele,.ction or in a special election to be held, notwithstanding any other requirement, including any requirement that elections be held on specified dates, Contained in the Elections Code, at least thirty days, but no more than one hundred eighty days following the adoption of the resolution calling the election. 6 of 8 13/10.190 Public Agency as Qualified Elector. A public agency shall be a qualified elector and entitled to vote in any election in which landowners are the electors. 13.10.200 Refunding Bonds, Use of Savings. The city may use any savings, from issuing refunding bonds, within the district in any manner that Council determines to be in the interests of the district and consistent with the purposes for imposing the special tax. 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 .... 7 of 8 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: COUNCILMEMBER MAGGARD, CARSON BENHAM, COUCH, HANSON, SULLIVAN SCRIVNER NOES: COUNCILMEMBER ' , ABSTAIN: COUNClLMEMBER ABSENT: COUNClLMEMBER 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: VIRGINIA GENNARO City Attorney By: ROBERT M. SHERFY Deputy City Attorney RMS:dll p:nks%'fd\l 3.10-SpecialTaxDistricts draft ordinance 2006.doc 8 of 8 PUBLIC STATEMENTS SPEAKER'S CARD Bud,qet and Finance Committee of the City Council Committee Meeting Date You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: ~--J~' ~"' ~ Company/ Organization: ['~)v~.~{~,,, .I C~'~ ~ Address: I(=~)~ [ ~ $' '1" 'T'iI,~JJ¢ '{J ~ Phone: Fax/e-mail: PUBLIC STATEMENTS SPEAKER'S CARD Budqet and Finance Committee of the City Council Committee Meeting Date · You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majority vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Name: Organization: Address: Subject: · ' ; ........ '-'. .-- .... , Y% may 'addressXthe 'Council ,under Publi~-'Statem'e6tA -Business': Comments,~egarding-hearln.q mat~ers will be heard"u~idet L~e~Hea~ing;poilJO~ "Of the;agend~ and a speaker's Card:k~ r~t'neCessa~:fOr.those iter~s, Pbblic 'state~ients-a~'!~mited t° three (3)mi%tes Per ~peaker ~ii~::a ~ma~imt~m:of .fifteen (i5) minutes;: per' side~ for~ang .one::sUbject:. Co[;nCil~ima~,~bY~simple tnajority .No action ~11 be takeii o~er ~ant° miler the~iSs~:i0 a.:C~)mm~ee.o~;,sta ,.address .,,the.:COUn~cil, dudnB, pLibliC,:S~ate~ent~;: unle~-a approved alter the name of the Person andthe SubjeCt matter i~ a~%~ged.. -PleaSe and,~preSent iLt;~ tlie Meetipg. Namei ' · Subj~'6t-or item No ADMI'NISTRATIVE REPORT i MEETING DATE: Feb. 22, 2006 I AGENDA SECTION: Consent Calendar ITEM: I~.. C. TO: Honorable Mayor and City Council APPROVED FROM: Nelson K. Smith, Finance Director DEPARTMENT HEAD ./~ DATE: February 14, 2006 CITY ATTORNEY ~'~ CITY MANAGER ~ SUBJECT: An Ordinance of the City of Bakersfield, Adding Chapter 13.10 to the Bakersfield Municipal Code, to establish certain procedures respecting special tax districts. RECOMMENDATION: Budget and Finance Committee recommends first reading of the ordinance. BACKGROUND: The City has recently entered into development agreements with local land owners associated with the Old River Ranch and Rosedale Ranch projects. The City also entered into a pre- annexation agreement with Sun Cai regarding the McAIlister Ranch project. Each of these agreements includes a commitment by the City to provide a mechanism for financing public facilities and/or services commonly known as Community Facilities Districts (CFD); also known as Mello-Roos Financing. Community Facility Districts provide developers with an optional financing mechanism to fund public facilities and services. A special tax is placed on the properties within the district, generally associated with the repayment of debt incurred by the district t© fund the public improvements. In order for the City to be able to provide this type of financing to these developers the City needs to adopt an ordinance allowing for the formation of CFD's. The City will also need to adopt a policy document regarding CFD's to establish some perimeters and guidelines for the districts. City staff are working with the Building Industry Association (BIA), local developers, outside bond counsel and financial advisors to develop the draft policy. We expect to present the draft policy document to the Budget and Finance Committee at their March 2006 meeting date. After their review, the policy document will come before the full Council for their consideration. The attached draft ordinance document was reviewed by the Budget and Finance Committee at their February 8, 2006 meeting. After some discussion, the Committee recommended that the draft ordinance be forwarded to the full Council for first reading. nks S:~KimG\Nelson~Admin - cfd oral 1st read.doc Feb. 9, 2006 ' ORDINANCE NO. AN ORDINANCE OF THE CITY OF BAKERSFIELD, ADDING CHAPTER 13.10 TO THE BAKERSFIELD MUNICIPAL CODE, TO ESTABLISH CERTAIN PROCEDURES RESPECTING SPECIAL TAX 'DISTRICTS. BE IT ORDAINED by the Council of the City of Bakersfield as follows: SECTION 1. Chapter 13.10 is hereby added to the Bakersfield Municipal Code to read as follows: CHAPTER 13.10 SPECIAL TAX DISTRICTS Sections: 13.10.010 Authority. 13.10.020 Title. 13.10.030 Definitions. 13.10.040 N on exc I usivity. 13.10.050 Conflict of Law. 13.10.060 Nature of Districts. 13.10.070 Construction. 13.10.080 Incorporation of the Mello-Roos Act. 13.10.090 Compliance with Chapter. 13.10.100 Extraterritorial Jurisdiction. 13.10.110 Adopting goals and Policies. 13.10.120 Authorized Services. 13.10.130 Authorized Facilities. 13.10.140 Services Existing Before District Formation. 13.10.150 Lease of Facilities. 13.10.160 Joint Community FacilitieS Agreement or Joint Exercise of Powers Agreement. 13.10.170 Hearing, Continuances. 13.10.180 Special Tax Levy Election. 13.10.190 Public Agency as Qualified Elector. 13.10.200 Refunding Bonds, Use of Savings. 13.10.010 Authority. The city is a municipal corporation, organized and existing under its Charter and the State constitution, with the power to make and enforce all laws and regulations I of 8 respecting municipal affairs, subject only to any restrictions and limitations Provided in the Charter and in the State constitution. The Council finds and declares that providing for special tax districts, to finance certain facilities and services, is necessary, essential, a public purpose, and a municipal affair of the city. 13.10.020 Title. This chapter may be cited as the City of Bakersfield Special Tax Financing Law. 13.10.030 Definitions. Unless the context otherwise requires, the following definitions shall govern the construction of this chapter. a. "District" means any special tax district formed pursuant to this chapter. b. "Facilities" means any or all facilities that a district may finance, purchase, construct, expand, improve, or rehabilitate pursuant to Government Code Section 53313.5. c. "Mello-Roos Act" 'means the Mello-Roos Community Facilities Act of 1982 (Chapter 2.5, commencing with Section 53311, of Part 1 of Division 2 of Title 5 of the Government Code. as amended from time to. time). Government Code Sections referenced in this chapter shall mean that Section as amended from time to time. d. "Private residential purposes," when considering property use, shall not include property used primarily for hotel or residential hotel purposes. Such property shall be deemed used for commercial and nonresidential use. e. "Services" means any or all of the following: 1. Maintaining,' servicing, or replacing (aa) any street, highway road, alleY, lane, boulevard, pedestrian mall, parkway, bike path, trail easement, or other way 2 of 8 dedicated to public Use or used by the public and (bb) all appurtenances and improvements therein including, but not limited to, medians; street signs, other signage, street lights, traffic signals, hydrants, soundwalls, drains, tunnels, sewers, curbs, gutters, sidewalks, conduits, culverts, and channels for drainage purposes, with necessary outlets, cesspools, manholes, catch basins, flush tanks, septic tanks, disposal plants, connection sewers, ditches, drains, conduits, channels, landscaping, and hardscaping. 2. Maintaining or servicing any lakes, streams, rivers, creeks, channels or other bodies of water and the streambeds, riverbeds, creekbeds, channelbeds or lakebeds, or replacing infrastructure necessary to maintaining or servicing anY of the foregoing. 3. Maintaining, servicing,' or replacing any landscaping, hardscaping, lighting or signage next to any right-of-way or other way dedicated to public use or used by the public and described in (1), above, or next to any canal, basin, or ditch. 4. Establishing and maintaining a reasonable reserve for replacement under (1)' through (3). above. The reserve for replacement shall be a service cost or expense and shall not be deemed payment for public facilities under Government Code Section 53321(d) when the property subject to the special tax is used for private residential purposes. 5. Maintaining health and safety services including, without limitation, police, fire, traffic signal control, and recreational services. 6. Maintaining, caring for, or preserving any facilities defined in this chapter. 7. Any other services allowed pursuant to Section 53313 of the Government Code. 3 of 8 13.10.040 Nonexclusivity. The procedures provided in this chapter are not exclusive, but are alternative to any other procedures provided in this Code or under State law. 13.10.050 Conflict of Law. This chapter is to be read and construed with the incorporated MellmRoos Act. In any conflict between this chapter and the provisions of the Mello-Roos Act, this chapter shall govern. 13.10.060 Nature of Districts. ~ Districts created pursuant to this chapter shall be deemed financing districts and not separate governmental agencies distinct from the city. 13.10.070 Construction. This chapter shall be liberally constructed. 13.10.080 Incorporation of the Mello-Roos Act. The Mello-Roos .Act is incorporated in and made a part of this chapter. Except as otherwise provided by this chapter, the mode and manner for financing facilities, for levYing and collecting Special taxes, and for issuing bonds shall be as prescribed in the Mello-Roos Act. 13.10.090 Compliance with Chapter. Any proceedings taken, special tax levied, or bonds issued pursuant to this· chapter shall not be held invalid for failure to comply with the provisions of this chapter provided such failure is not a constitutional defect. 13.10.100 Extraterritorial Jurisdiction. Any district may be created pursuant to this chapter within the territorial jurisdiction of the city. or, upon compliance with the procedures set forth in Streets and 4 of 8 Highways Code Sections 5115 through 5118,. may extend beyond the territorial limits of the city. 13,10.110 Adopting Goals and Policies. The city may initiate proceedings to establish a district or to annex territory 'to a district pursuant to this chapter without first considering and adopting goals and policies. Establishing goals and polices as provided in Government Code Section 53312.7, concerning the adoption of local goals and policies, shall be permissive and not mandatory to initiating proceedings pursuant to this chapter. 13.10.120 Authorized Services. A district special tax, whether approved by vote of landowners or registered voters, may finance services specified in the Mello-Roos Act or services as defined in this chapter. Services financed may supplant services already available in the territory when the district is created or when the territory is annexed to a district. 13.10.130 Authorized Facilities. A district special tax, whether approved by vote of landowners or registered voters, may finance facilities specified in the Mello-Roos Act or facilities as defined in this chapter. Facilities financed may supplant facilities already available in the territory when the district is created or when the territory is annexed to a district. 13.10.140 Services Existing Before District Formation. Notwithstanding Government Code Section 53313, a' special tax imposed. pursuant to this chapter may finance any facilities or service~ authorized in this chapter, which were being provided in the territory of the district before the district was created or ' the territory annexed. The special tax imposed may finance facilities or services that are in addition to existing facilities or services, or that supplant existing facilities or services. 5 of 8 13.10.150 Lease of Facilities. Notwithstanding Government Code Section 53313.5, the city may lease out facilities financed pursuant to this chapter if the Council determines that it is in the best interest of the city to dO so. 13.10.160 Joint Community Facilities Agreement or Joint Exercise of Powers Agreement. Notwithstanding Government Code Section 53316.2(b), the city, at any time, may enter a joint community facilities agreement with any local agency or public agency, or a joint exercise of powers agreement with any local agency. 13.10.170 Hearings, Continuances. The hearing on the proposed formation of a district as required'by sUbdiVision (e) of Government Code Section 53321, and the hearing on a proposed annexation to an existing district as required by subdivision (f) of Government Code Section 53339.3, shall be hem not less than 10 or more than 60 days after the date that the Council adopts the resolution of intention to establish the district, or to annex territory, and may be continued from time to time without further notice', but shall be completed within one year of the original hearing date. 13.10.180 Special·Tax Levy Election. The Council shall submit the levy of any special taxes to the qualified electors of the proposed district or to the qualified electors of the territory to be annexed to the district in the next general election or in a special election to be held, notwithstanding any other requirement, inCluding any requirement that elections be held on Specified dates, contained in the Elections Code, at least 'thirty days, but no more than one hundred eighty days following the adoption of the resolution calling the election. 6 of 8 13.10.190 Public Agency as Qualified Elector. A public agency shall be a qualified elector and entitled to vote in any eleCtion in which landowners are the electors. 13.10.200 Refunding Bonds, Use'of Savings. The city may use any savings, from issuing refunding bonds, within .the district in any manner that Council determines to be in the interests of the district and consistent with the purposes for imposing the special tax. 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 ...... 7 of 8 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: COUNCILMEMBERMAGGARD, CARSON, BENHAM, COUCH, HANSON SULLIVAN, SCRIVNER NOES: COUNCILMEMBER , ABSTAIN: COUNCILMEMBER ABSENT: COUNCILMEMBER 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: VIRGINIA GENNARO City Attorney By: ROBERT M. SHERFY DeputY City Attorney RMS:dll p:nks\cfd\l 3.10-SpecialTaxDisu-.~:~s dra~l ordinance 2006.doc 8 of 8 PUBLIC STATEMENTS SPEAKER'S CARD Budget and Finance Committee of the City Council Committee Meeting Date '"'~..~_.O~.~ You are invited to address the Committee under Public Statements on any subject that is listed on the Committee Agenda. Public statements are limited to three (3) minutes per speaker. The Committee may, by simple majodty vote, waive the time limit. No action will be taken; this Committee gathers information and reports back to the City Council. Please fill out a Speaker's Card and present it to the Committee Chair: Vice-Mayor Mike Maggard Company/ Organization: ~---~,1 ~,.~1~ ~'I,,,~L~I t~_J'r~l,,.~,{~ / ~ ~ Phone: ~. O~ F~e-mail: ~.~I~ Subject: ~,~ '~ ~r~ ~ ~'~'~ ADMINISTRATIVE REPORT MEETING DATE: Feb. 22, 2006 ' AGENDA SECTION: Consent Calendar ITEM: [~. C.. TO: Honorable Mayor and City Council APPROVED FROM: Nelson K. Smith, Finance Director DEPARTMENT HEAD DATE: February 14, 2006 CITY ATTORNEY CITY MANAGER SUBJECT: An Ordinance of the City of Bakersfield, Adding Chapter 13.10 to the Bakersfield Municipal Code, to establish certain procedures respecting special tax districts. RECOMMENDATION: Budget and Finance Committee recommends first reading of the ordinance. BACKGROUND: The City has recently entered into development agreements with local land owners associated with the Old River Ranch and Rosedale Ranch projects. The City also entered into a pre- annexation agreement with Sun Cai regarding the McAIlister Ranch project. Each of these agreements includes a commitment by the City to provide a mechanism for financing public facilities and/or services commonly known as Community Facilities Districts (CFD); also known as Mello-Roos Financing. Community Facility Districts provide developers with an optional financing mechanism to fund public facilities and services. A special tax is placed on the properties within the district, generally associated with the repayment of debt incurred by the district to fund the public improvements. In order for the City to be able to provide this type of financing to these developers the City needs to adopt an ordinance allowing for the formation of CFD's. The City will also need to adopt a policy document regarding CFD's to establish some perimeters and guidelines for the districts. City staff are working with the Building Industry Association (BIA), local developers, outside bond counsel and financial advisors to develop the draft policy. We expect to present the draft policy document to the Budget and Finance Committee at their March 2006 meeting date. After their review, the policy document will come before the full Council for their consideration. The attached draft ordinance document was reviewed by the Budget and Finance Committee at their February 8, 2006 meeting. After some discussion, the Committee recommended that the draft ordinance be forwarded to the full Council for first reading. nks S:~KimGWelson~Admin - cfd oral 1st read.doc Feb. 9, 2006 ORDINANCE NO;. AN ORDINANCE OF THE CITY OF BAKERSFIELD, ADDING CHAPTER 13.10 TO THE BAKERSFIELD MUNICIPAL CODE, TO ESTABLISH CERTAIN PROCEDURES RESPECTING SPECIAL TAX 'DISTRICTS. BE IT ORDAINED by the Council of the City of Bakersfield as follows: SECTION 1. Chapter 13.10 is hereby added to the Bakersfield Municipal Code to read as follows: CHAPTER 13.10 SPECIAL TAX DISTRICTS Sections: 13.10.010 Authority. 13.10.020 Title. 13.10.030 Definitions. 13.10.040 Nonexclusivity. 13.10.050 Conflict of Law. 13.10.060 Nature of Districts. 13.10.070 Construction. 13.10.080 Incorporation of the Mello-Roos Act. 13.10.090 Compliance with Chapter. 13.10.100 Extraterritorial Jurisdiction. 13.10.110 Adopting goals and Policies. 13.10.120 Authorized Services. 13.10.130 Authorized Facilities. 13.10.140 Services Existing Before District Formation. 13.10.150 Lease of Facilities. 13.10.160 Joint Community Facilities Agreement or Joint Exercise of Powers Agreement. 13.10.170 Hearing, Continuances. 13.10.180 Special Tax Levy Election. 13.10.190 Public Agency as Qualified Elector. 13.10.200 Refunding Bonds, Use of Savings. 13.10.010 Authority. The city is a municipal corporation, organized and existing under its Charter and the State constitution, with the power to make and enforce all laws and regulations I of 8 respecting municipal affairs, subject only to any restrictions and limitations provided in the Charter and in the State constitution. The Council finds and declares that providing for special tax districts, to finance certain facilities and services, is necessary, essential, a public purpose, and a municipal affair of the city. 13.10.020 Title. This chapter may be cited as the City of Bakersfield Special Tax Financing Law. 13.10.030 Definitions, Unless the context otherwise requires, the following definitions shall govern the construction of this chapter. a. D strict means any special tax district formed pursuant to this chapter. b. "Facilities" means any or all facilities that a district may finance, purchase, construct, expand, improve, or rehabilitate pursuant to Government Code Section 53313.5. c. "Mello-Roos Act"means the Mello-Roos Community Facilities Act of 1982 (Chapter 2.5, commencing with Section 53311, of Part 1 of Division 2 of Title 5 of the Government Code. as amended from time to. time). Government Code Sections referenced in this chapter shall mean that Section as amended from time to time. d. "Private residential purposes," when considering property use, shall not include property used primarily for hotel or residential hotel purpo.ses. Such property shall be deemed used for commercial and nonresidential use. e. "Services" means any or all of the following: 1. Maintaining,' servicing, or replacing (aa) any street, highway, road, alleY, lane, boulevard, pedestrian mall, parkway, bike path, trail easement, or other way 2 of 8 dedicated to ·public use or used by the public and (bb)' all appurtenances and improvements therein including, but not limited to, medians, street signs, other signage, street lights, traffic signals, hydrants, soundwalls, drains, tunnels, sewers, curbs, gutters, sidewalks, conduits, culverts, and channels for drainage purposes, with necessary outlets, cesspools, manholes, catch basins, flush tanks, septic tanks, disposal plants, connection sewers, ditches, drains, conduits, channels, landscaping, and hardscaping. 2. 'Maintaining or servicing any lakes, streams, rivers, creeks, channels or other bodies of water and the streambeds, riverbeds, creekbeds, channelbeds or lakebeds, or replacing infrastructure necessary to maintaining or servicing any of the foregoing. 3. Maintaining, serviCing, or replacing any landscaping, hardsCaping, lighting or signage next to any right-of-way or other way dedicated to public use or used by the public and described in (1), above, or next to any canal, basin, or ditch. 4. Establishing and maintaining a reasonable reserve for replacement under (1) through (3), above. The reserve for' replacement shall be a service cost or expense and shall not be deemed payment for public facilities under Government Code Section 53321(d) when the property subject to the special tax is used for private residential purposes. 5. Maintaining health and safety services including, without limitation, police, fire, traffic signal control, and recreational services. · 6. Maintaining, caring for, or preserving any facilities defined in this chapter. 7. Any other services allowed pursuant to Section 53313 of the Government Code. 3 of 8 13.10.040 Nonexclusivity. The procedures provided in this chapter are not exclusive, but are alternative to any other procedures provided in this Code or under State law. 13.10.050 Conflict of Law. This chapter is to be read and construed with the incorporated Mello~Roos Act. In any conflict between this chapter and the provisions of the Mello-Roos Act, this chapter shall govern. 13.10.060 Nature of Districts. ' Districts created pursuant to this chapter shall be deemed financing districts and not separate governmental agencies distinct from the city. 13.10.070 Construction. This chapter shall be liberally constructed. 13.10.080 Incorporation of the Mello-Roos Act. The Mello-Roos Act is incorporated in and made a part of this chapter. Except as otherwise provided by this chapter, the mode and manner for financing facilities, for levYing and collecting special taxes, and for issuing bonds shall be as prescribed in the Mello-Roos Act. 13.10.090 Compliance with Chapter. Any proceedings taken, special tax levied, or bonds issued pursuant to this. chapter shall not be held invalid for failure to comply with the provisions of this chapter. provided such failure is not a constitutional defect. 13.10.100 Extraterritorial Jurisdiction. Any district may be created pursuant to this chapter within the territorial jurisdiction of the city. or, upon compliance with the procedures set forth in Streets and '4 of 8 Highways Code Sections 5115 through 5118, may extend beyond the territorial limits of the city. 13.10.110 Adopting Goals and Policies. The city may initiate proceedings to establish a district or to annex territory 'to a district pursuant to this chapter without first considering and adopting goals and policies. Establishing goals and polices as provided in Government Code. Section 53312.7, concerning the adoption of local goals and policies, shall be permissive and not mandatory to initiating proceedings pursuant to this chapter. 13.10.120 Authorized Services. A district special tax, whether approved by vote of landowners or registered voters, may finanCe services specified in the Mello-Roos Act or services as defined in this chapter. Services financed may supplant services already available in the territory when the district is created or when the territory is annexed to a district. 13.10.130 Authorized Facilities. A district special tax, whether approved by vote of landowners or registered voters, may finance facilities specified in the Melto-Roos Act or facilities as defined in this chapter. Facilities financed may supplant facilities already available in the territory when the district is created or when the territory is annexed to a district. 13.10.140 Services Existing Before District Formation. Notwithstanding Government Code Section 53313, a special tax imposed. pursuant to this chapter may finance any facilities or service~ authorized in this chapter, which were being provided in the territory of the district before the district was created or the territory annexed. The special tax imposed may finance facilities or services that are in addition to existing facilities or services, or that supplant existing facilities or services. 5 of 8 13.10.150 Lease of Facilities. Notwithstanding Government Code Section 53313.5, the city may lease out facilities financed pursuant to this chapter if the Council determines that it is in the best interest of the city to dO so. 13..10.160 Joint Community Facilities Agreement or Joint Exercise of Powers Agreement. Notwithstanding Government Code Section 53316.2(b), the city, at any time, may enter a joint community facilities agreement with any 'local agency or public agency, or a joint exercise of powers agreement with any local agency. 13.10.170 Hearings, Continuances. The hearing on the pro.posed formation of a district as required'by sUbdivision (e) of Government Code Section 53321, and the hearing on a proposed annexation to an existing district as required by subdivision (f) of GOvernment Code Section 53339.3, shall be held not less than 10 or more than 60 days after the date that the Council adopts the resolution of intention to establish the district, or to annex territory, and may be continued from time to time without further notice', but shall be completed within one year of the original hearing date. 13.10.180 Special Tax Levy Election. The Council shall submit the levy of any special taxes to the qualified electOrs of the proposed district or to the qualified electors of the territory to be annexed to the district in the next general election or in a special election to be held, notwithstanding any other requirement, inCluding any requirement that elections be held on specified dates, contained in the Elections Code, at least thirty days, but no more than one hundred eighty days following the adoption of the resolution calling the election. 6 of 8 13.10.190 Public Agency as Qualified Elector.'- A public agency shall be a qualified elector and entitled to vote in any eleCtion in which landowners are the electors. 13.10.200 Refunding Bonds, Use of Savings. The city may use any savings, from issuing refunding bonds, within the district in any manner that Council determines to be in the interests of the district and consistent' with the purposes for imposing the special tax. 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 ........ 7 of 8 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: COUNCILMEMBERMAGGARD CARSON BENHAM, COUCH, HANSON, SULLIVAN, SCRIVNER NOES: COUNCILMEMBER ABSTAIN: COUNCILMEMBER ABSENT: COUNCILMEMBER CITY CLERK and EX OFFICIO of the Council of the City of Bakersfield APPROVED: By: HARVEY L. HALL, Mayor CITY OF BAKERS:FIELD APPROVED AS TO FORM: VIRGINIA GENNARo City Attorney By:. ROBERT M. SHERFY DeputY City Attorney RMS:dll p:nks\cfd\l 3.10-SpecialTaxDis:T~cts draP~ ordinance 2006.doc 8 of 8 ADMINIST TIVE REPORT I MEETING DATE: Janua~ 25, 2006 I AGENDA SECTION: Consent Calendar I ITEM: ~. TO: Honorable Mayor and City Council APPROVED FROM: Donna L. Kunz, Economic Development Director DEPARTMENT HEAD DATE: January 19, 2006 CITY ATTORNEY /~ CITY MANAGER SUBJECT: Community Development Block Grant Reprogramming and Project Amendments: 1) Fire Station #5, Old Town Kern, Economic Development and American Dreams Downpayment Assistance. 2) Transfer $195,511 from the Section 108 Debt Service Fund to the Capital Improvement Budget within the Community Development Block Grant Fund for the construction of Fire Station 3) Transfer $285,038 Project savings from the Economic and Community Development, Operating Budget and appropriate $146,969 CDBG Program Income to the Capital Improvement budget within the Community Development Block Grant Fund for the construction of Fire Station #5. (WARDS 1 and 2) RECOMMENDATION: Budget and Finance Committee and staff recommend approval. BACKGROUND: Economic and Community Development staff is proposing to reprogram Community Development Block Grant (CDBG) from completed or cancelled projects. In compliance with HUD regulations, any significant change or addition to the approved CDBG annual plan must undergo an amendment process which includes obtaining citizen views and comments on-the propOsed change for a period of 30 days. A notice was published on December 24, 2005 requesting comments and to date no comments have been received. On December 13, 2005, the Budget and Finance Committee approved the request for additional funding for Fire Station #5 and recommended that the item be forwarded to the full Council for consideration. The CDBG amendment will add a total of $709,130 from program savings (Home Access Grant program, Southeast Bakersfield Street Light Improvements and Section 108 repayments) and additional CDBG program income for the project located at 102 East White Lane. The available Section 108 debt repayment funds are the result of an action approved by Council last fiscal year, authorizing the use of Section 108 savings to pay the debt in the current fiscal year, thus freeing up budgeted funds for reprogramming. S:~Admins\City Council\City Council Admins 2006~Amend 012506.doc 1/19/2006 8:34 AM ADMINISTRATIVE REPORTPage2 Summary of Fire Station #5 Construction - Additional Funding Project Savings Amount Southeast Bakersfield Street Light Improvement Project- FY01/02 $81,621 Home Access Grant Program - FY04/05 $48,529 Program Savings - FY 04/05 $236,509 Section 108 Loan Repayment for Public Facilities- FY04/05 $195,511 Additional Program Income - FY05/06 $146,969 Total $709,139 There are two additional components of this amendment required by the Department of Housing and Urban Development. The following program changes are administrative transactions only with no budgetary impact: 1) revise the end use of the CDBG funds earmarked for the Old Town Housing Project from will be transferred from acquisition/demolition for housing to the economic development category to more accurately reflect the revised Old Town Mixed-use Project. CDBG funds from FY's 99/00, 00/01, 01/02, and 02/03 totaling $439,050 will be shifted as the result of this amendment; 2) the final section of the amendment will change the scope of the American Dream Down Payment Initiative Assistance (ADDI) from a loan to eligible first time home buyer to a. grant and the necessary changes to the City of Bakersfield's recapture guidelines language for the ADDI for FY's 03/04, 04/05, and 05/06. The following HUD program years are affected: Amendment No. 12 (FY99/00), Amendment No. 11 (FY00/01), Amendment No. 13 (FY01/02), Amendment No. 6 (FY02/03), Amendment No. 5 (FY04/05), and Amendment No. 2 (FY05/06). S:~Admins\City Council\City Council Admins 2006~,mend 012506.doc 1/19~20068:34 AM ADMINISTRATIVE REPORT TO: Honorable Mayor and City Council APPROVED FROM: Alan Tandy, City Manager DEPARTMENT HEAD DATE: January 18, 2006 CITY A'I'FORNEY ~_ ~--., CITY MANAGER // SUBJECT: Agreement with City of Bakersfield and Bakersfield Professional Sports, LLC for a National Basketball Association Development League Team RECOMMENDATION: Staff recommends approval of agreement. BACKGROUND: The National Basketball Association Developmental League (NBADL) is the minor league for the NBA. Bakersfield Professional Sports, LLC, which is owned by Stan Ellis, proposes to bring a franchise to Bakersfield. The Bakersfield franchise will have two NBA affiliates in the 2006/07 season and more in later years, and will play their 24 home games at Rabobank Arena. Bakersfield is only one of thirty cities in the nation to host an NBADL team. Attached is an agreement between Bakersfield Professional Sports, LLC and SMG acting herein on behalf of the City of Bakersfield. This agreement is for a one (5) year term with the option for renewal. The agreement is structured at a no risk basis for the City of Bakersfield. The team will pay the Arena a flat fee of $4,750 per game plus a percentage of ticket sales, with the minimum payment per season being $108,000. The team will receive 10% of concessions sales. The terms of this lease have been crafted along the same lines as the agreements with the Blitz, Condors, and CSUB Roadrunners. The National Basketball Development League season opener is scheduled for November 17, 2006 at Rabobank Arena. The ownership group and SMG will have representatives at the Council meeting to make some comments and respond to questions. January 19, 2006, 9:53AM SS:~Admin Rpts~2006\NBADL 012506.doc AT:JF:akr:al