HomeMy WebLinkAbout04/14/2009, B2 - ECONOMIC STIMULUS UPDATE council Mcc=s°m 4-14-09
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CITY OF SAN LUIS OBISPO
FROM: Shelly Stanwyck,Assistant City Manager�ly
SUBJECT: ECONOMIC STIMULUS UPDATE
RECOMMENDATION
1. Receive update on the City's response to the American Recovery and Reinvestment Act.
2. Authorize staff to apply for American Recovery and Reinvestment Act grants and authorize the
City Manager to execute any agreements related to such grants.
DISCUSSION
Background
The recently enacted federal economic stimulus package—titled the American Recovery and Reinvestment Act
(ARRA)--commits a total of$787 billion nationwide. This funding provides: (1) $330 billion in aid to the states,
(2) about $170 billion for various federal projects and assistance for other non-state programs, and (3) $287
billion for tax relief.
What does this mean for the State of California? California is estimated to receive over$31 billion from the first
two components and billions more in competitive grants. The state aid"pie" consists of three pieces: (1) federal
dollars that can be used to address budget shortfalls, (2) funds that supplement existing state spending, and (3)
competitive grants. The table below illustrates how the first two pieces of the pie will likely be divided.
California to receive over$31 billion over 3 years in State Aid
(does not include significant additional federal funds the state is likely to receive from competitive grants)
(In Millions)
Federal Fiscal Year
Program Area 2008-09 2009-10 2010-11 Totals
Health $3,986 $4,026 $1,024 $9,036
Education - 7,973 -- 7,973
Labor/work force development 3,498 2,420 79 5,997
Social Services 1,500 1,441 577 3,518
Transportation 1,302 1,302 – 2,604
General purpose fiscal stabilization – 1,100 – 1,100
Resources/environmental 597 – – 597
Housing programs 381 -- – 381
Criminal justice 264 – – 264
Other 27 – – 27
Totals $11,555 $19,262 $1,680 $31,497
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Federal Stimulus_Opportunities Page 2
More importantly what does this mean for the City of San Luis Obispo?
At the time of writing this report, the picture is not yet crystal clear as to what exactly this means for the
City. However, it is becoming clearer as various programs announce competitive and formulaic funding
availability. In the case of formulaic grants, staff is finding that the City's "proportionate" share is
defined, but that a formal grant process must still be undertaken. For instance, the California Energy
Commission announced on Thursday, March 26, 2009 that of the $351.5 million available for local
governments to use for projects and programs to reduce total energy use, $199,400 would be targeted for
the City of San Luis Obispo. Similarly, our Transit Program is applying for $1.3 million in federal
transit funds that have been identified for San Luis Obispo. Finally, a recent Justice Assistance Grant
announcement earmarked $78,925 for San Luis Obispo.
In addition to formulaic funding opportunities are more competitive grant programs. A multi-
department work group has been established and staff is focused on: (1) identifying appropriate
opportunities and (2) sharing information to facilitate the City's grant applications. This staff effort, and
a keen eye for grant opportunities, is being coordinated by Sue Baasch, the City's former Senior Analyst
for Utilities. A number of programs, some new and some familiar but with new funding are being
reviewed daily. While some of the funding amounts are not huge, cumulatively they will bolster the
City's revenue picture and will allow the City to proceed with a number of planned projects.
What Departments Are Doing
Staff members from all City Departments constantly review various media for grant opportunities. With
the federal stimulus grants there is a need to review group emails, electronic bulletin boards, press
releases, and other materials generated almost hourly on this topic. Staff has established the ethic of
"leaving no stone untumed" and plans to or will be responding to any and all appropriately identified
opportunities. The most coordinated efforts to date have been in response to Regional Economic
Recovery Work Plans. There are 12 in California and they are based on geographic regions as defined
by the California Department of Transportation. Our materials for this were submitted on April l"
What follows is a summary, but Department of federal stimulus grant opportunities being pursued or
planned for application.
1. Administration
a. Natural Resources
To date, in reviewing federal stimulus opportunities, the Natural Resources Program has identified three
potential projects totaling $965,000. The first is continued work on the Bob Jones Trail. $300,000 is
proposed for design and construction of the two needed bridges at the Prado Road and Los Osos Valley
Road ends of the current trail. These connections would allow a "through trail" and should lead to
increased use of the trail for recreational and educational purposes. The second is $600,000 for design
and construction of a new trail connecting Calle Joaquin and Madonna Roads. This is part of the
envisioned Bob Jones system and would utilize the current 13 acre parcel owned by the City at Calle
Joaquin and an existing easement on the Dalidio property adjacent to the Prefumo Creek channel. This
project would significantly"jump-start"the use of that open space area. The third is for$65,000 for fish
passage improvements under Highway 101 and the frontage road on Dry Creek, which flows out of the
Johnson Ranch Open Space. Dry Creek is as its name implies, dry in its lower reaches, but it is
perennial further upstream and is known to contain a small population of southern steelhead. The
improvements would make it easier for steelhead to reach the Johnson Ranch and Dry Creek during the
wintertime and to likewise make it easier for smolts to migrate out to San Luis Obispo Creek and thence
to the ocean.
Federal Stimulus Opportunities Page 3
b. Economic Development
The City's Economic Development Manager is closely monitoring various media for possible stimulus
oriented grant opportunities. Although as of yet none have materialized. Staff is hopeful that a program
targeted at direct job creation, for instance a micro grant program for small businesses, will materialize
in the near term.
2. Community Development
The Community Development Department is focusing its grant applications in two obvious areas. The
first is in the area of energy reduction and sustainability and funding is being sought for the development
of a Climate Action Plan. A completed Climate Action Plan would identify future projects for the City
to enhance its "green footprint." Anticipated projects range from solar panel installation in identified
areas to increased efficiency pumps for water transmission. The second area that Community
Development is focusing its efforts on is affordable housing. The City's Housing Programs manager
will be working on a variety of opportunities and likely coordinating with the Housing.Authority.
3. Fire
At this time, it appears that the Assistance to Firefighters Grant Program (AFG) will receive some
monies from the economic stimulus package. The primary goal of the Assistance to Firefighters Grants
(AFG) is to meet the firefighting and emergency response needs of fire departments and nonaffiliated
emergency medical services organizations. Since 2001, AFG has helped firefighters and other first
responders to obtain critically needed equipment, protective gear, emergency vehicles, training, and
other resources needed to protect the public and emergency personnel from fire and related hazards. Fire
Department staff continues to closely monitor the AFG website to take advantage of any grant
opportunity made available.
4. Parks and Recreation
Few federal stimulus opportunities have emerged for Parks and Recreation at this time. However, the
department has been very creative and has applied for a Ludwick Family Foundation grant to improve
HVAC, public address equipment, a projection screen, and tables at the Ludwick Community Center.
Additionally, although it may not be eligible for federal stimulus money, the approved skate park master
plan has been put on the list of potential projects from the City. Parks and Recreation is presently
pursuing the following(non federal stimulus grants) to assist in funding this project:
a. Stewardship Council, .5200,000.
Funded through a 2003 Settlement between the California Public Utilities Commission and Pacific Gas
and Electric (PG&E), the Stewardship Council focuses on programs and facilities that benefit youth
served within PG&E's service area. This fund supports projects that improve park infrastructure,
addresses a broad community impact, and make parks and open space more accessible. A maximum of
$200,000 can be requested and it must be shown that the project can be completed within two years of
funding. The deadline for 2009 is July 13 with the award to be announced on November 19.
b. Tony Hawk Foundation,525,000.
With a focus on building skate parks that serve underprivileged children, the Tony Hawk Foundation
offers grants up to $25,000 for construction of new facilities. Conditions of the grant include that the
skate park is free to the public for use and open during daylight hours. Grant funds are awarded for a
single year. The deadline for this year is October 1,2009 with the award to be announced in December.
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Federal Stimulus Opportunities Page 4
5. Police
As Council will recall, due to grant deadlines the Police Department has already applied for two grant
programs. Those programs were reviewed by Council at its April 7, 2009 meeting and are as follows:
a. COPS Hiring Recovery Program -deadline is April 14
The COPS Hiring Recovery Program (CHRP) is a highly competitive grant program and has an April
14`h application deadline. This program provides funding directly to law enforcement agencies to create
and preserve sworn peace officer jobs and to increase community policing capacity. There is no local
match requirement for CHRP funding. The funding is for three years and will be based on current entry-
level salary and benefits; consequently any additional costs for higher salaries for hired individuals will
be the City's responsibility. The grant program requires the city to retain and fully fund for a fourth year
any police officer positions received through the grant. The City has applied for two officer positions to
staff a new Neighborhood Services Team through this program.
b. Edward Byrne Memorial Justice Assistance Grant(JAG)
The JAG Program is a noncompetitive formula grant and the funding allocation is based on the
population and crime rate of a local jurisdiction. The amount allocated to our City is $78,925. Awards
are made in the first fiscal year of the appropriation and may be expended during the following three
years, for a total of four grant period years. JAG Program funds must be used to supplement existing
state and local funds for program activities and must not replace those funds that have been appropriated
for the same purpose. Staff has applied for grant funding to fund a half time Records Clerk for two
years. An alternative use for the funds proposed by staff was to utilize grant funds to purchase
equipment and technology to improve the efficiency of the Department.
6. Public Works
a. Transit On April 7, 2009 Council reviewed and approved several projects for the City's Transit
system to utilize federal stimulus funds allocated directly to the City through the existing 5307 program
distribution formula. Those projects include: upgrading the automatic vehicle locator passenger access
system, upgrade of the system's fare box infrastructure to allow for the use of smart cards, preventative
maintenance funds, and improvements to the transit facility. City staff worked closely with our local
transit partner SLORTA to determine which projects would be eligible for funding from the $1,323,660
that is allocated to our area. The City projects will utilize $1,023,660 of the available funds.
b. Infrastructure. Public Works has been working closely the San Luis Obispo County Council of
Governments (SLOCOG) to prioritize projects for funding that will be available to the City through
existing formula grants based on population, as well as for competitive award. The amount to be
allocated directly to our city based on population is $747,000, and all agencies within the County were
provided an opportunity to compete for additional funds from a discretionary amount that SLOCOG
would allocate. At its April meeting SLOCOG formally approved the list of projects to be funded for
each agency within the County. The City project on this list is Phase 3 of the Railroad Safety Trail,
which was approved for $1,200,000 for construction funding. This amount completes the funding
needed for the project and will be delivered within the 365 day timeline required for stimulus projects.
c. Competitive Surface Transportation Program. This separate grant program is for larger projects and
will be administered by the Federal Highway Administration. Application guidelines are due to come
out in May 2009, after which agencies will be able to submit projects. This program has a longer time
period (three years) in which to utilize the grant funding. Based on conversations with Caltrans and
SLOCOG staff, the projects that will be submitted in this category must demonstrate regional
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significance to be competitive. City staff believes that the LOVR Interchange project is the only city
project of regional significance that is far enough along in the project development process to be able to
utilize the funds within the three year timeframe.
d Energy Efficiency and Conservation Block Grants Another category in the stimulus funding
package provides formula grants to local agencies to improve energy efficiency in the transportation
sector, among other benefits. The City has received notice that we will be allocated $199,400 for our use
on projects in this category, which can be chosen and approved by the Council directly. Staff has
identified two bicycle projects that need funding to complete construction: The Bob Jones Trial
connection to LOUR, and the Railroad Safety Trail Bridge over 101. Both projects can be federalized
(which is a requirement of all stimulus projects), and each have small shortfalls for construction. PW
staff discussed this category with the Utilities department, and their needs under this category are far
more expensive than $200,000, so they would not be submitting a project for consideration.
7. Utilities
After analyzing the funding opportunities available through the federal stimulus package, the Utilities
Department following investigation is likely to pursue funding for energy efficiency projects at both the
Water Treatment and Water Reclamation Facilities. The source of these funds will be through the
Department of Energy. This will include exploring the feasibility of installing renewable energy
generation capabilities (i.e. wind, solar, etc.) at each facility. Utilities has also explored funding
opportunities through the state's Clean Water State Revolving Fund (CWSRF) and the Safe Drinking
Water State Revolving Fund (SDWRF). Unfortunately, staff was unable to identify "shovel ready"
projects that would qualify under the guidelines and timeline established by each program. Staff will
monitor the expenditure status of the ARRA funding to determine if future opportunities to apply for
these monies materialize.
Council Authorization for Federal Stimulus Grant Applications and Next Steps
Today, more than ever, grant revenues are a critical part of the City's financial health strategy. Pursuant
to City grant policy, grant applications in excess of $5,000 should be approved by the Council with
delegation of receipt or grant funds and contract execution to the City Manager. Because of the short
deadlines associated with many federal stimulus package grants and the highly competitive nature of
these opportunities, staff recommends suspending this policy with respect to federal stimulus grant
applications only. If Council is amenable to this temporary change in practice, staff will provide Council
with regular updates on federal stimulus grant applications through quarterly reports and or Council
notes.
FISCAL IMPACTS
Federal stimulus grants are generally expected not to require matching funds. Therefore this program
will provide an additional source of funding for various City projects. In light of the City's present fiscal
condition, should a federal stimulus grant require matching funds, staff will seek Council's approval
prior to application so that Council can appropriately prioritize such expenditure in light of all of the
competing interests for City funds at this time.
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