The URL can be used to link to this page

Home My WebLink About04/01/2003, C6 - PARK IMPROVEMENT FUNDING i counat M.*B � 4-1-03 r-A acEnaa Repout ,�N� CITY OF SAN LUIS OBISPO FROM: Bill Statler, Director of Finance SUBJECT: PARK IMPROVEMENT FUNDING CAO RECOMMENDATION 1. Finalize funding for the Damon-Garcia athletic fields, which reduces project costs by $384,900 based on the favorable construction contract awarded.in December 2002. 2. Revise funding sources for the Ludwick Community Center remodel project, using $111,100 from the Parkland Development Fund (park-in lieu fees) rather than from the General Fund. 3. Authorize the CAO to amend the Santa Rosa Park telecommunications lease with Cingular Wireless to reflect park improvement changes totaling $64,453 for fencing and parking lot repaving, to be funded through adjusted``in-lieu"rental payments. DISCUSSION Overview The Damon-Garcia athletic fields, the Ludwick Community Center remodel and Santa Rosa Park improvements under the telecommunications lease agreement with Cingular, are three separate and distinct projects. However, they share similar funding sources. The major funding change affecting these projects is the proposed "finalized" budget for the Damon-Garcia fields, which is $384,900 less than the current budget. Along with other proposed changes, this frees-up resources for other park improvement projects. As such, it makes sense to address the funding impacts for all related projects at one time rather than separately. The net result from the recommended changes in park improvement funding is to: 1. Reduce General Fund appropriations by $181,700, which will help in balancing the 2003-05 Financial Plan "budget gap." 2. Make Proposition 40 funding of $225,000 available for a warm water therapy pool, which the Council has adopted as a major City goal for 2003-05. 3. Complete Santa Rosa Park improvements without any fiscal impacts on the General Fund or Parkland Development Fund in 2003-05. Damon Garcia Athletic Fields On October 15,2002, the Council authorized the CAO to invite construction bids for the Damon- Garcia athletic fields and award the contract if it was within the engineer's estimate of C!(Q- Park Improvement Funding Page 2 $3,960,000. Bids were received on November 21, 2002 and Souza Construction was the low bidder at $3,363,509. Accordingly, the CAO awarded the contract to them on December 6, 2002. Revised Project Budget. Based on this contract award, the following summarizes the recommended budget for this project: e . Current I Proposed Variance Project Costs(Excluding Land Purchase) Study and Design 450;000 450,000 - Construction 3,960,000 3,363,500 596,500 Construction Management 40,000 40,000 Development Impact Fees 162,000 176,000 (14,000) Public Art 20,000 20,000 - Contingencies 198,400 396,000 (197,600) Total Project Costs 1 4 830,400 4,445,500 384,900 Funding Sources-(Excluding-Land Purchase)_ _ 1999 Lease Revenue Bonds 3,415,300 3,415,300 - CIP Reserve 70,600 70,600 State Grants - Proposition 12 391,000 391,000 - Proposition 40 225,000 225,000 Developer Fees 25,000 25,000 - Parkland Development Fund: Park In-Lieu Fees 490,000 400,700 89;300 Transfer from Other Projects - Santa Rosa Park Renovations 127,500 127,500 - Sinsheimer Park Improvements 86,000 86,000 - Total Funding Sources A 4,830 400 - 4445 00 384 900 As reflected above, the construction contract is $596,500 less than the current budget. However, when the Council authorized advertising in October 2002, the project budget was based on a contingency of only 5% of the engineer's estimate. With additional funds available in the project budget, Public Works recommends increasing the contingency to 10% of the engineer's estimate, which is more typical for construction projects. With this amendment (along with a small adjustment in development impact fee costs),the net savings is$384,900. This revision will free-up funding sources as follows: 1. $70,600 will be restored to the General Fund via the CIP reserve. This will become available to help finance General Fund programs and projects in the 2003-05 Financial Plan. 2. $225,000 in Proposition 40 funds will become available for other park improvement projects. At the April 10, 2003 Council meeting on major City goal work programs, we will recommend that this be allocated to the therapy pool project as part of the 2003-05 Financial Plan. Park Improvement Funding Page 3 3. $89,300 in park in-lieu fees will become available for other park improvement projects. As discussed below, we recommend that this be allocated to the Ludwick Center Remodel project in-lieu of General Fund support. Ludwick Center Remodel . Current Proposed Variance The Council awarded the construction contract Donation 607,000 607,000 for the Ludwick Community Center remodel Proposition 12 125;300 125,300 - project on February 4, 2003 to Maino General Fund 200,700 89,600 111,100 Construction in the amount of $709,900. In IPark In-Lieu Fees 111,100 111,100 Total $933.000 $933,000 $ - funding this contract award, the Council appropriated an additional $111,100 from the General Fund via the completed projects account. With the funds made available from the Damon-Garcia athletic fields project ($89,300) combined with available fund balance in the Parkland Development Fund, we recommend using park-in-lieu fees instead. As shown in the sidebar chart,the project budget is unaffected by this change. Santa Rosa Park Improvements Significant improvements with a value of $227,083 will be made to Santa Rosa Park under the telecommunications lease approved by the Council with Cingular Wireless on February 4, 2003. In finalizing plans for this work, we have identified the following workscope changes for the Council's approval:. BaU Field Fencing. The current plan calls for � relocating a five-foot fence as part of extending i; 9 p °. �°`°�°' right field of the westerly softball field and JI removing most of the existing center parking jai lot in order to do so (Area A of the sidebar site i� ? �. • Right A. plan). Given the condition of the current fence and improved protection with an eight-foot u i ,� l' S _ �'{ I' Q b fence, we recommend installing a new fence instead at an"in-lieu"cost of$9,660. 1 Parking Lot Repaving. As a maintenance I ' !iil ti "Bili project, parking lot repaving (Area B) is I • �u scheduled for 2003-04. However, rather than completing this work as a separate project after 1 Cingular Wireless completes the park B.Parking Lot Repaving improvements, we recommend amending our lease agreement to include this work now at an added"in lieu"cost of$54,793. Added Trees. When the Council approved the _ telecommunications lease, they requested ...00 additional tree plantings in the landscaped area off Santa Rosa Street (Area Q. Cingular has agreed to do this at no added cost. � � 3 Park Improvement Funding Page 4 The net cost of these changes is $64,453, bringing the total cost for the park improvements to $291,536. Cingular has agreed to fund these changes as an added credit to the "in-lieu" rent payments. As shown in the chart below, park improvement costs are applied as credits against the annual rent otherwise due under the current lease agreement. Based on the current improvement costs of $227,083, no "cash" lease payments are due Annual Lease PayMents: Current Agreement for the first five years, assuming a minimum Annual Form of Payment increase in annual rent of 3% per year and Year Rent In-Lieu Cash two tenants. In the sixth year (2008), some 2003 40,000 40,000 - of the lease payment will be due in cash, 2004 41,200 41,200 _ followed thereafter by the "normal" annual 2005 42,436 42,436 - rent payments for the rest of the lease term. 2006 43,709 43,709 - (For example, $47,762 is due in 2009 reflecting the first-year rent based on two 2007 45,020 45,020 tenants of $40,000, adjusted annually 2008 46,371 14,718 31,653 thereafter for the 3% minimum rent 2009 _ 47,762 1 1 47,762 increase.) TOTAL 1 $ 306,498 1 $ 227,083 1 $ 79,415 Note: Lease has a maximum term of 20 years Including the added costs of $64,453 as additional "in-lied' rent credits will extend the credit period by a little over one year, with cash payments starting in 2009 instead of 2008. This results in being able to complete all of the improvements at Santa Rosa Park without any fiscal impacts on the General Fund or Parkland Development Fund in 2003-05. CONCURRENCES The Department of Public Works and Parks & Recreation concur with these recommendations. FISCAL IMPACT The fiscal impact from the proposed funding changes is favorable: 1. Reduction in General Fund CIP allocations of $181,700, which will help in balancing the 2003-05 Financial Plan "budget gap." 2. Availability of Proposition 40 funding in the amount of$225,000 for a warm water therapy pool, which the Council has adopted as a major City goal for 2003-05. 3. Completion of Santa Rosa Park improvements without any fiscal impacts on the General Fund or Parkland Development Fund in 2003-05. G:Budget Folders/Financial Plans/2003-05 Financial Plan/Park Improvement Funding/Council Agenda Report