The URL can be used to link to this page

Home My WebLink About18 - Defer Certain Capital Improvement ProjectsCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 18 January 27, 2009 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: City Manager's Office Homer Bludau, City Manager 9491644 -3000 or hbludau@city.newport- beach.ca.us SUBJECT: Council Decision Regarding City Manager's Recommendation to Defer Certain Capital Improvement Projects Funded Within the FY 2008 -2009 Budget ISSUE: Does the City Council support the City Manager's recommendation to defer action on sixteen (16) capital improvement projects at a cost savings of $2,088,900? If not, which projects does the City Council support deferring and which does it desire to move forward with? RECOMMENDATION: Support the City Manager's recommendation to defer the 16 projects at a cost savings of $2,088,900. DISCUSSION: Background: Over the past five months, the Nation's and Orange County's economy has struggled. By almost all economic measures, personal spending is down, unemployment is up substantially and financial markets have been in disarray. There is a lack of confidence on the part of citizens that the economy is going to improve, and even if it does, the improvement is expected to be incrementally slow in taking place. Like all cities in California, Newport Beach is realizing a loss in certain anticipated revenues because of the economic recession resulting in less spending of personal income. While property tax revenues are on target, we anticipate a $3.5M loss in estimated sales taxes and may not meet our estimated projections on transient occupancy tax revenues. The FY 2008 -2009 budget adopted by Council in June 2008, was predicated on realizing these estimated revenues, and since they do not appear likely, we need to ensure we have a Recommendation to Defer Certain Capital Improvement Projects January 27, 2009 Page 2 balanced budget. There are two ways to do that — either raise additional revenue or reduce expenditures. In order to reduce expenditures, the City Manager has already taken two steps towards balancing the budget: 1) freeze new employee hires except those authorized by the City Manager, and 2) require all departments to reduce expenditures over the remainder of the fiscal year by one percent (1 %). As an additional way to reduce General Fund expenditures, the City Manager proposes deferring certain capital improvement projects which were approved with the current budget's adoption. The following are among those projects which depend on General Fund revenues for their funding and therefore, are proposed to be deferred: Fire Station 1 (Peninsula) Gender Modifications $180,000 Fire Station 3 (Irvine Ave.) Water Pipe Replacement 30,000 Lifeguard Headquarters Garage Remodel 52,000 Police Facility Office Rehabilitation 100,000 Subdrain Improvements 270,000 Avocado Ave. Medians Renovation 169,000 Balboa Blvd. Median and Parkway Improvements 84,000 Bristol Street North Landscape Improvements 107,000 Corona del Mar State Beach Landscape Improvements 95,000 Dover Drive Medians Renovation 125,000 Westcliff Drive Medians Renovation 71,000 Directional, Wayfinding and Monument Signage 234,000 Semeniuk Slough Dredging Project 350,000 Back Bay View Park Enhancement 191,000 Fire Department Technology; Facilities Management 7,200 Fire Department Technology; Mobile Computers 23.700 TOTAL $2,088,900 CITY MANAGER'S PHILOSOPHY ON WHICH PROJECTS TO DEFER: The City Manager's guiding philosophy was to not defer projects which were already underway; to defer projects which would be "nice to have," rather than necessary to have; and to defer projects by which no harm to services being provided residents would be realized. To be sure, the median beautification projects are important to the community and would improve the aesthetics in the areas they are proposed. My feeling was these locations have been in their current condition for long periods of time, and that the community would expect us to cut back on our expenditures and would understand Recommendation to Defer Certain Capita! improvement Pro jects January 27, 2009 Page 3 landscaping projects being the first to be deferred. The facility projects listed for deferment are those which would be good to undertake, but are not absolutely necessary at this time. Council Members may have questions about a number of projects which are not included within the City Manager's recommendation for deferment, and the City Manager welcomes those questions. The bottom line is we need to balance our budget, and while there are many ways of achieving that goal, the City Manager recommends deferring projects which he believes will not adversely affect the community or will have minimal impact to our residents. Deferring projects does not mean we won't do them; it just means we won't do them at this time. We are fortunate not to be facing more difficult budget - balancing decisions at this time; however, that time may well come, and if it does, there will be more difficult decisions to be made than deferring landscape and facility modification projects. At the January 101n Special City Council meeting on establishing the priorities for 2009, the City Manager first reviewed his list of projects he proposed to defer. Later in that same meeting, the City Council adopted thirteen (13) priorities for the 2009 calendar year, one of which had to do with ensuring we prepare and adopt a conservative budget for the 2009- 2010 year and wisely place our resources where they would do the most good. (The City Manager will review those priorities with action steps and schedules during the February I e Council meeting.) Since Council has directed that priority for this calendar year, the City Manager feels his recommendations are in line with that policy and priority direction. Environmental Review: The City Council's approval of this Agenda Item does not require environmental review. Public Notice: This agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the Council considers the item). Submitted by: .w �4 - 0MER L. BL DAU City Manager Attachment Project Listing by Funding Source C1P Recommended to be Page Fund General Fund Rebudget Budget Total Deferred 7011 Facilities Rehab and Remodel 3 C4120806 Community Youth Center Improvements $90,300 $970,000 $1,060,300 4 C1002010 Corporation Yard Office Space $0 $45,000 $45,000 5 C2320527 Fire Station 1 Modifications $180,000 $0 $180,000 $180,000 6 C2320856 Fire Station 3 Water Pipe Replacement $30,000 $0 $30,000 $30,000 7 C2320715 Fire Station 7 Training Tower Modifications $32,500 $98,500 $131,000 8 C1002011 Lifeguard Headquarters Garage Remodel $0 $52,000 $52,000 $52,000 11 C5100907 Little Corona Restroom Facility $46,000 $97,500 $143,500 15 C1002004 Police Facility Office Rehabilitation $39,900 $0 $39,900 15 C1002013 Police Facility Office Rehabilitation $0 $118,000 $118,000 $100,000 Total Facilities Rehab and Remodel $418,700 $1,381,000 $1,799,700 7012 Drainage 19 C2502005 - Amethyst i South Bayfront Tidal Structure and Valve $0 $90,000 $90,000 48 C2502003 Santa Ana Ave/ Avon St Slope Stabilization and Drainage $0 $250,000 $250,000 51 C2502004 Subdrain Improvements $386,900 $25,000 $411,900 $270,000 Total Drainage $386,900 $365,000 $751,900 7013 Streets 20 C2002015 Avocado Avenue Medians Renovation $0 $179,000 $179,0OD $169,000 21 C2002029 Balboa Boulevard Median and Parkway Improvements $0 $100,000 $100,000 $84,000 23 C5100277 Balboa Village Alley Replacement $177,300 $0 $177,300 27 C2002028 Bristol Street North Landscape Improvements $0 $120,000 $120,000 $107,000 28 C5200932 Coast Highway Median Improvements $78,000 $0 $78,000 30 C2002027 Corona del Mar State Beach Landscape Improvements $0 $95,000 $95,000 $95,000 Funding -1 C7P Recommended to be Page Fund General Fund Rebudget Budget Total Deferred 7013 Streets continued 32 C2202001 Corona del Mar Streetlight Improvements $0 $100,000 $100,000 34 C2002007 Dover Drive Medians Renovation $125,000 $0 $125,000 $125,000 35 C5100854 Dover Drive Sidewalk $84,000 $0 $84,000 39 C3170904 Irvine Terrace Landscape Improvements $107,500 $30,000 $137,500 44 C2002026 MacArthur Boulevard Median Trees $0 $100,000 $100,000 45 C2001008 Median Maintenance Strips - Citywide $95,000 $0 $95,000 57 C3001004 Neighborhood Traffic Management Improvements $150,000 $0 $150,000 49 C2001009 Sidewalk, Curb and Gutter Replacement and ADA Impr $0 $666,000 $666,000 50 C2202000 Streetlight Conversion Program - Westcliff Area $558,000 $440,000 $998,000 53 C2002025 West Santa Ana Heights Concrete and Sign Improvements $0 $55,000 $55,000 54 C2002014 Westcliff Drive Medians Renovation $80,000 $D $80,000 $71,000 Total Streets $1,454,800 $1,885,000 $3,339,800 7014 Miscellaneous 78 C5100889 Areas of Special Biological Significance Program $8,100 $0 $8,100 79 C5002001 Areas of Special Biological Significance Protection $0 $140,000 $140,000 81 C5002002 Buck Gully Canyon Stabilization and Flood Control $0 $1,200,000 $1,200,000 82 C5002018 Buck Gully Resource Management Plan $170,000 $0 $170,000 98 C8002008 China Cove Slope Repairs $59,350 $100,000 $159,350 99 C8002000 CIP Project Management $131,600 $0 $131,600 56 C2700813 Directional, Wayfinding and Monument Signage $234,000 $0 $234,000 $234,000 86 C5100969 Irrigation - Smart Controller Program $132,000 $50,000 $182,000 87 C5002003 Newport Coast Runoff Reduction Program $0 $2DO,000 $200,000 88 C5100912 Newport Coast Watershed Program $47,200 $0 $47,200 72 C44020D1 Newport Harbor Dredging Project $D $100,0DO $100,000 89 C5100923 Semeniuk Slough Dredging Project $350,000 $0 $350,000 $350,000 90 C5002017 Upper Bay Comprehensive Resource Management Plan $108,000 $24,000 $132,000 Total Miscellaneous $1,240,250 $1,814,000 $3,054,250 Funding -2 CIP Recommended to be Page Fund General Fund Rebudget Budget Total Deferred 7015 Parks 64 C3170933 Back Bay View Park Replenishment and Enhancement $195,325 $0 $195,325 $191,000 66 C4002003 Bonita Creek Park Artificial Play Surface Study $0 $200,000 $200,000 85 C3130764 Irrigation - Newport Coast Central Computer System $0 $100,000 $100,000 77 C4120928 Tennis Court Fencing Replacement $56,300 $50,000 $106,300 Total Parks $251,625 $350,000 $601,625 7017 Automation and Communications 100 C2310620 Fire Department Technology: Facilities Management $7,200 $0 $7,200 $7,200 100 C2310911 Fire Department Technology: Mobile Computers $23,700 $0 $23,700 $23,700 109 C8002026 Tsunami Warning System $198,100 $0 $198,100 Total Automation and Communications $229,000 $0 $229,000 7019 Capital Purchase and Repair 13 C1820918 Police Facility Generator Replacement $299,510 $0 $299,510 16 C1002014 Police Facility Roof Repair and HVAC Repair $0 $74,000 $74,000 103 C5100977 Newport Coast Community Center AV Equipment $133,500 $0 $133,50D Total Capital Purchase and Repair $433,010 $74,000 $507,010 7024 Neighborhood Enhancement 106 C8001000 Parking Meters Replacement $0 $120,000 $120,000 Total Neighborhood Enhancement $0 $120,000 $120,000 Subtotal $2,088,900 Funding -3 CAPITAL PROJECT UPDATE COUNCIL MEETING JANUARY 27, 2009 $90,000,000 $80,000,000 $70,000,000 $60,000,000 $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 General Fund Fund Balance 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 General Fund Revenues $70,000,000 - Top Revenue Sources - -- $60,000,000 $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 <o n ao rn o N m It 'n m r 0 rn a o a rn rn rn rn o 0 0 0 0 0 0 0 0 o w ui co r ao m o cS v �n co ro co m rn m rn m o 0 0 0 0 0 0 0 0> o m 0) m 0) W N N N N N N N M O O r r r r r N d Secured Property Tax Sales Tax & Sales Tax In Lieu UTOT TOTAL GENERAL FUND 2008 -09 2006 -07 2007 -08 Revised 2009 -10 Projected $ Chanae % Chanae $ 48,905,823 $ 53,116 666 $ 56,741,667 $ 57,876,500 $ 1,134,833 2.0% 29,010,693 29,872,781 26,680,116 27,347,119 667,003 2.5% 10 919,757 12,751,518 12,979,079 13,000 000 20,921 0.2% 149,162,924 158,701 661 148,248 710 147,855,736 (392,974) -0.3% Annual Growth I 10.0 ° / 6.49/ -6.6 °/ -0.3 °/ Sales Tax Analysis 2004/05 2005106 Year To Date 2006107 Year To Date 2007108 Year To Date 2008109 Year To Date % Change September $ 2,455,230 $ 2,138,208 $ 2,138,208 $ 1,764,888 $ 1,764,888 $ 2,399,418 $ 2,399,418 $ 1,383,425 $ 1,383,425 - 42.34% October $ 1,147,600 $ 1,344,800 $ 3,483,008 $ 1,404,100 $ 3,168,988 $ 1,546,300 $ 3,945,718 $ 1,463,200 $ 2,846,625 - 27.86% November $ 1,530,100 $ 1,585,300 $ 5,068,308 $ 1,872,000 $ 5,040,988 $ 2,061,700 $ 6,007,418 $ 1,951,000 $ 4,797,625 - 20.14% December $ 1,763,747 $ 2,670,847 $ 7,739,155 $ 2,361,970 $ 7,402,957 $ 2,376,068 $ 8,383,487 $ 1,767,669 $ 6,565,294 - 21.69% January $ 1,286,500 $ 1,385,200 $ 9,124,355 $ 1,551,700 $ 8,954,657 $ 1,669,300 $ 10,052,787 $ 1,484,600 $ 8,049,894 - 19.92% February $ 1,710,700 $ 1,846,900 $ 10,971,255 $ 2,068,800 $ 11,023,457 $ 2,225,700 $ 12,278,487 $ 1,979,500 $ 10,029,394 - 18.32% March $ 1,807,614 $ 2,049,163 $ 13,020,418 $ 1,985,953 $ 13,009,411 $ 1,346,551 $ 13,625,037 $ 1,465,543 $ 11,494,937 - 15.63% April $ 1,132,900 $ 1,239,000 $ 14,259,418 $ 1,291,800 $ 14,301,211 $ 1,376,500 $ 15,001,537 $ 1,362,000 $ 12,856,937 - 14.30% May $ 1,510,600 $ 1,652,000 $ 15,911,418 $ 1,722,400 $ 16,023,611 $ 1,835,300 $ 16,836,837 $ 1,816,000 $ 14,672,937 - 12.85% June $ 1,840,019 $ 2,095,584 $ 18,007,002 $ 2,354,324 $ 18,377,935 $ 2,172,476 $ 19,009,313 $ 1,663,071 $ 16,336,008 - 14.06% July $ 1,229,200 $ 1,496,800 $ 19,503,802 $ 1,454,700 $ 19,832,635 $ 1,561,500 $ 20,570,813 $ 1,471,400 $ 17,807,408 - 13.43% August $ 1,638,900 $ 1,995,800 $21,499,602 $ 1,939,600 $21,772,235 $ 2,082,000 $22,652,813 $ 1,961,800 $19,769,208 - 12.73% Total $ 19.053.110 $ 21.499.602 12.84% $ 21,772.235 1.27% $ 22.652.813 4.04% $ 19.769.206 - 12.73% - 12.73% CIP Recommended to Page Fund General Fund Rebudget Budget Total be Deferred 7011 Facilities Rehab and Remodel 3 C4120806 Community Youth Center Improvements $90,300 $970,000 $1,060,300 4 C1002010 Corporation Yard Office Space $0 $45,000 $45,000 5 C2320527 Fire Station 1 Modifications $180,000 $0 $180,000 $180,000 6 C2320856 Fire Station 3 Water Pipe Replacement $30,000 $0 $30,000 $30,000 7 C2320715 Fire Station 7 Training Tower Modifications $32,500 $98,500 $131,000 8 C1002011 Lifeguard Headquarters Garage Remodel $0 $52,000 $52,000 $52,000 11 C5100907 Little Corona Restroom Facility $46,000 $97,500 $143,500 15 C1002004 Police Facility Office Rehabilitation $39,900 $0 $39,900 15...01002013.. Police Facility. fficeRehabilitation ............ .............................$0 ..... $118,000......,. $118,000 $100,000 Total Facilities Rehab and Remodel $418,700 $1,381,000 $1,799,700 7012 Drainage 19 C2502005 Amethyst / South Bayfront Tidal Structure and Valve $0 $90,000 $90,000 48 C2502003 Santa Ana Ave/ Avon St Slope Stabilization and Drainage $0 $250,000 $250,000 51 C2502004.. Subdrain Improvements .................. .......................... $ 386900..........$25,000...._.,, $411 900 $270,000 Total Drainage $386,900 $365,000 $751,900 7013 Streets 20 C2002015 Avocado Avenue Medians Renovation $0 $179,000 $179,000 $169,000 21 C2002029 Balboa Boulevard Median and Parkway Improvements $0 $100,000 $100,000 $84,000 23 C5100277 Balboa Village Alley Replacement $177,300 $0 $177,300 27 C2002028 Bristol Street North Landscape Improvements $0 $120,000 $120,000 $107,000 28 C5200932 Coast Highway Median Improvements $78,000 $0 $78,000 30 C2002027 Corona del Mar State Beach Landscape Improvements $0 $95,000 $95,000 $95,000 C1P Page Fund General Fund Rebudget Budget Recommended to be Total Deferred $125,000 $71,000 $234,000 $350,000 7013 Streets continued 32 C2202001 Corona del Mar Streetlight Improvements $0 $100,000 $100,000 34 C2002007 Dover Drive Medians Renovation $125,000 $0 $125,000 35 C5100854 Dover Drive Sidewalk $84,000 $0 $84,000 39 C3170904 Irvine Terrace Landscape Improvements $107,500 $30,000 $137,500 44 C2002026 MacArthur Boulevard Median Trees $0 $100,000 $100,000 45 C2001008 Median Maintenance Strips - Citywide $95,000 $0 $95,000 57 C3001004 Neighborhood Traffic Management Improvements $150,000 $0 $150,000 49 C2001009 Sidewalk, Curb and Gutter Replacement and ADA Impr $0 $666,000 $666,000 50 C2202000 Streetlight Conversion Program - Westcliff Area $558,000 $440,000 $998,000 53 C2002025 West Santa Ana Heights Concrete and Sign Improvements $0 $55,000 $55,000 54 02002014.. Westcliff, Drive Medians Renovation .............. ...................... $80,000,,.....,,,.,,,,, $0 .......... $80,000, Total Streets $1,454,800 $1,885,000 $3,339,800 7014 Miscellaneous 78 C5100889 Areas of Special Biological Significance Program $8,100 $0 $8,100 79 C5002001 Areas of Special Biological Significance Protection $0 $140,000 $140,000 81 C5002002 Buck Gully Canyon Stabilization and Flood Control $0 $1,200,000 $1,200,000 82 C5002018 Buck Gully Resource Management Plan $170,000 $0 $170,000 98 C8002008 China Cove Slope Repairs $59,350 $100,000 $159,350 99 C8002000 CIP Project Management $131,600 $0 $131,600 56 C2700813 Directional, Wayfinding and Monument Signage $234,000 $0 $234,000 86 C5100969 Irrigation - Smart Controller Program $132,000 $50,000 $182,000 87 C5002003 Newport Coast Runoff Reduction Program $0 $200,000 $200,000 88 C5100912 Newport Coast Watershed Program $47,200 $0 $47,200 72 C4402001 Newport Harbor Dredging Project $0 $100,000 $100,000 89 C5100923 Semeniuk Slough Dredging Project $350,000 $0 $350,000 90,.05002017.. Upper. Bay. Comprehensive. Resource Management Plan $ 108, 000... ..,.,,.$24,000.,.,,,.._$132,000 Total Miscellaneous $1,240,250 $1,814,000 $3,054,250 $125,000 $71,000 $234,000 $350,000 C/P Recommended to be Page Fund General Fund Rebudget Budget Total Deferred $191,000 $7,200 $23,700 Subtotal $2,088,900 7015 Parks 64 C3170933 Back Bay View Park Replenishment and Enhancement $195,325 $0 $195,325 66 C4002003 Bonita Creek Park Artificial Play Surface Study $0 $200,000 $200,000 85 C3130764 Irrigation - Newport Coast Central Computer System $0 $100,000 $100,000 77 C4120928 Tennis Court Fencing Replacement $56,300 $50:000,. .....$106,300 Total Parks $251,625 $350,000 $601,625 7017 Automation and Communications 100 C2310620 Fire Department Technology: Facilities Management $7,200 $0 $7,200 100 C2310911 Fire Department Technology: Mobile Computers $23,700 $0 $23,700 „109. C8002026 Tsunami, WarningSystem .............................. . .... ..$ 198, 100...........__... $0..,,.,,,._$198,100, Total Automation and Communications $229,000 $0 $229,000 7019 Capital Purchase and Repair 13 C1820918 Police Facility Generator Replacement $299,510 $0 $299,510 16 C1002014 Police Facility Roof Repair and HVAC Repair $0 $74,000 $74,000 103...5100977 Newport Coast Community.Center AV Equipment $133,500 $0.........$133,500 Total Capital Purchase and Repair $433,010 $74,000 $507,010 7024 Neighborhood Enhancement 106. C8001000. Parking Meters Replacement .. $0 $120:000 „$120,000 Total Neighborhood Enhancement $0 $120,000 $120,000 $191,000 $7,200 $23,700 Subtotal $2,088,900