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HomeMy WebLinkAbout10-20-2015 Item 16 - PeckChief Garrett Olson SLO City Fire 2160 Santa Barbara Ave, San Luis Obispo, CA 93401 COUNCIL MELTING:_ ITEM NO.: 06 Peck Planninkv and Developmen#, LLC Planning Development Economics Subject: Fifth Fire Station for San Luis Obispo REC-1E VCD OCT 19 2015 �LQ CITY CLERK I note that the City Council will discuss the progress on the update to the Fire Master Plan this coming Tuesday evening. As you know, we at Avila Ranch have been following the development of the City's fire master planning efforts, including those during the LUCE update, and the current Fire Master Plan Update being prepared by Citygate. This sort of longterm planning is essential given the construction, funding and staffing challenges for a new major public facilities like this one. The Fire Master Plan's initial findings state that much of the southern area of the community (some developed portions and some undeveloped portions) do not meet the City's travel response time objectives. We have met with City staff regarding these issues and have integrated a number of strategies to address this issue in our plan. The Fire Department and Citygate have posed several key questions to the City Council regarding plans for anew fire station in South San Luis Obispo. Our comments, suggestions, and response to those questions in our own project are summarized below: 1. Should the 4 minute emergency response time policy be revised to define it as travel time for Code 3 calls for service? Response: The answer is in the affirmative. As currently expressed, this standard is unachievable unless the density of fire stations in the community is doubled. Compliance with the NFPA standards will provide on adequate level of response. We also commend the Planning Commission for observing that new homes are much less prone to structure fires and emergency medical calls, and that the City may wish to look at a different standard for areas of the community that may have higher or lower calls for service or risks. 2. When revenues are adequate to fund the construction and operation of a fifth fire station that does not result in diminishing per capita City service levels for other City services such as parks, public works, and law enforcement, shall the City pursue the construction and staffing of a fifth fire station in the southern area of the City in order to enhance the probability of achieving established response time standards? Response: The answer is "yes'; qualified by a recommendation that the City commit to Identifying new sources of financing for the capital and operating costs for the fifth fire station. The City should look at funding the portion of the capital and operating costs attributable to new development out of special sources of revenue such as a Community Facilities District (CFD) or other mechanism. The city's obligation could be limited to only those expenses that are attributable to existing developed portions of the service area. These sources build up incrementally and the city would need to establish a CFD soon. 3. Should the City explore options for incrementally addressing emergency response coverage gaps, such as initially addressing the medical response gap with a differently staffed acid configured crew, and building toward full fire, rescue and medical services as the region develops and additional funding is realized? Response: Again, the answer is "yes ". Most of the calls for service are medical emergencies, especially in new home developments which have fire suppression sprinklers. In the Avila Ranch project, we are identifying a key site where a smaller scale fire station /emergency medical dispatch facility can be located as an interim way to address the need for foster EMS response. A conceptual location for this facility is at the intersection of Earthwood and Venture, which would provide coverage for the entire Avila Ranch area, and the south Higuera area. 4. Should the Master Plan consider land based financing models, such as a Community Facilities District, to finance any funding gap so that new development pays its fair share for building and operating a fifth fire station? Response: The answer is "yes ". The City should look at funding the portion of the capital and operating costs attributable to new development out of special sources of revenue such as a Community Facilities District (CFD) or other mechanism. The city's obligation could be limited to only those expenses that are attributable to existing developed portions of the service area. These sources build up incrementally and the city would need to establish a CFD soon. The Public Facilities Finance Plan for the Avila Ranch Specific Plan (Airport Area Specific Plan Amendment) recommends this as the only way to finance both capital and operating expenses. It is also not subject to the rigorous "benefit" test associated with other assessment district mechanisms. These districts can beset up to annex other properties benefiting from this improvement. Other options to fund the capital portion of the assessment districts, an EIFD, or other mechanisms. Also note that the City's 2015 -2017 Budget and Financial Plan (attached) support the usage of this mechanism for public safety facilities. We look forward to continuing progress and involvement in this matter. Sincerely, en J. eck, AICP Project Manager Attachment: Budget and Financial Plan Policies Cc: Mayor Jan Howell Marx Vice Mayor John Ashbaugh Councilmember Carlyn Christianson Councilmember Dan Carpenter Councilmember Dan Rivoire 2015 -2017 City budget and Financial Plan provides the following current guidance on the usage of such financing tools. A. Public Pur2ose -There will be a clearly articulated public purpose informing an assessment or special tax district in financing public infrastructure improvements. This should include a finding by the Council as to why this form of financing is preferred to other funding options such as impact fees, reimbursement agreements, or direct developer responsibility for the improvements. B. Eligible Improvements. Except as otherwise determined by the Council when proceedings for district formation are commenced, preference in financing public improvements through a special tax district shall be given for those public improvements that help achieve clearly identified community facility and infrastructure goals in accordance with adopted facility and infrastructure plans as set forth in key policy documents such as the General Plan, Specific Plan, Facility or Infrastructure Master Plans, or Capital Improvement Plan. Such improvements include study, design, construction and /or acquisition of.• 1. Public safety facilities. 2. Water supply, distribution and treatment systems. 3. Waste collection and treatment systems. 4. Major transportation system improvements, such as freeway interchanges, bridges; intersection improvements; construction of new or widened arterial or collector streets (including related landscaping and lighting); sidewalks and other pedestrian paths, transit facilities; and bike paths. 5. Storm drainage, creek protection and flood protection improvements. 6. Parks, trails, community centers and other recreational facilities. 7. Open space. 8. Cultural and social service facilities. 9. Other governmental facilities and improvements such as offices, information technology systems and telecommunication systems. 10. School facilities will not be financed except under appropriate joint community facilities agreements or joint exercise of powers agreements between the City and school districts. C. Active Role. Even though land -based financings may be a limited obligation of the City, it will play an active role in managing the district. This means that the City will select and retain the financing team, including the financial advisor, bond counsel, trustee, appraiser, disclosure counsel, assessment engineer and underwriter. Any costs incurred by the City in retaining these services will generally be the responsibility of the property owners or developer, and will be advanced via a deposit when an application is filed; or will be paid on a contingency fee basis from the proceeds from the bonds. D. Credit Quality. When a developer requests a district, the City will carefully evaluate the applicant's financial plan and ability to carry the project including the payment of assessments and special taxes during build -out. This may include detailed background, credit and lender checks, and the preparation of independent appraisal reports and market absorption studies. For districts where one property owner accounts for more than 25% of the annual debt service obligation, a letter of credit further securing the financing may be required. E. Reserve Fund -A reserve fund should be established in the lesser amount of.• the maximum annual debt service; 125% of the annual average debt service, or 10% of the bond proceeds. F. Value -to -Lien Ratio - The minimum value -to -lien ratio should generally be 4:1. This means the value of the property in the district with the public improvements, should be at least four times the amount of the special tax debt. The City may consider allowing a value -to -debt ratio of 3:1, but the Council would make special findings in this case. G. Capitalized Interest During Construction- Decisions to capitalize interest will be made on a case -by -case basis, with the intent that if allowed, it should improve the credit quality of the bonds and reduce borrowing costs, benefiting both current and future property owners. H. Maximum Burden - Annual assessments (or special taxes in the case of Mello -Roos or similar districts) should generally not exceed 1% of the sales price of the property, and total property taxes, special assessments and special tax payments collected on the tax roll should generally not exceed 2 %. I. Special Taxes /Benefit Apportionment - Assessments and special taxes will be apportioned according to a formula that is clear, understandable, equitable and reasonably related to the benefit received by, or burden attributed to, each parcel with respect to its financed improvement. Any annual escalation factor should generally not exceed 2 %. J. Special Tax District Administration - In the case of Mello -Roos or similar special tax districts, the total maximum annual tax should not be less than 110% of the annual debt service. The rate and method of apportionment should include a back -up tax in the event of significant changes from the initial development plan, and should include procedures for prepayments.