HomeMy WebLinkAbout11-24-2020 REOC Agenda PacketCity of San Luis Obispo, Agenda, Planning Commission
Agenda
REVENUE ENHANCEMENT OVERSIGHT COMMISSION
Tuesday November 24, 2020
Based on the threat of COVID-19 as reflected in the Proclamations of Emergency issued by both the Governor of
the State of California, the San Luis Obispo County Emergency Services Director and the City Council of the City
of San Luis Obispo as well as the Governor’s Executive Order N-29-20 issued on March 17, 2020, relating to the
convening of public meetings in response to the COVID-19 pandemic, the City of San Luis Obispo will be holding
all public meetings via teleconference. There will be no physical location for the Public to view the meeting.
Below are instructions on how to view the meeting remotely and how to leave public comment.
Additionally, members of the Revenue Enhancement Oversight Commissioners are allowed to attend the meeting
via teleconference and to participate in the meeting to the same extent as if they were present.
Using the most rapid means of communication available at this time, members of the public are encouraged
to participate in Commission meetings in the following ways:
1.Remote Viewing - Members of the public who wish to watch the meeting can view:
View the Webinar (recommended for the best viewing quality):
Registration URL: https://attendee.gotowebinar.com/register/6275765392314496271
Webinar ID 918-514-547
Telephone Attendee: +1 (562) 247-8422; Audio Access Code: 418-314-423
Note: The City uses Go to Webinar for REOC Meetings. Please test speakers and mic prior to joining
webinar. Click here to watch a YouTube tutorial for GoToWebinar Attendees.
2.Public Comment - The City Council will still be accepting public comment. Public comment can be
submitted in the following ways:
Mail or Email Public Comment
Received by 3:00 PM on the day of meeting - Can be submitted via email to
advisorybodies@slocity.org or U.S. Mail to City Clerk at 990 Palm St. San Luis Obispo, CA 93401.
All emails will be sent to Commissioners and saved as agenda correspondence however we cannot
guarantee emails received after 3:00 PM on the day of the meeting we be sent out to Commission
or uploaded to the website prior to the meeting starting.
Verbal Public Comment
In Advance of the Meeting - Call (805) 781-7164; state and spell your name, the agenda item
number you are calling about and leave your comment. The verbal comments must be limited to 3
minutes. All voicemails will be forwarded to the Commissioners and saved as Agenda
Correspondence. Voicemails will not be played during the meeting.
During the meeting – Joining the webinar (instructions above). Once the meeting has started
please put your name and the item # you would like to speak on in the questions box. During public
comment for the item your name will be called, and your mic will be unmuted. Contact the office
of the City Clerk at cityclerk@slocity.org for more information.
All Comments/Correspondence received will be saved as part of the record for the meeting.
Revenue Enhancement Oversight Commission Agenda for November 24, 2020 Page 2
Tuesday November 24, 2020
5:30 p.m. REGULAR MEETING Teleconference
CALL TO ORDER Vice Chair Jeannette McClure
OATHS OF OFFICE
1.Administer the Oaths of Office - Commissioner Matt Quaglino.
(Teresa Purrington)
ROLL CALL: Commissioners Christopher Ellwood, Jim Hamari, Matt Quaglino,
Tony Skapinsky and Vice Chair McClure
PUBLIC COMMENT: At this time, people may address the Commission about items not on
the agenda. Persons wishing to speak should come forward and state their name and address.
Comments are limited to three minutes per person. Items raised at this time are generally referred
to staff and, if action by the Commission is necessary, may be scheduled for a future meeting.
CONSIDERATION OF MINUTES
2.Draft Minutes of the Revenue Enhancement Oversight Commission of June 30, 2020
BUSINESS ITEMS
3.Review Purpose of the Revenue Enhancement Oversight Commission and Elect Officers.
(Ryan Betz)
Recommendation: Review the purpose and scope of the Revenue Enhancement Oversight
Commission and elect a Chairperson and Vice-Chairperson to serve for a one-year term.
4.Introduction to City Finances.
(Brigitte Elke, Finance Director; Debbie Malicoat, Accounting Manager/Controller)
Recommendation: Receive a report on City Finance and some of its terminology.
Revenue Enhancement Oversight Commission Agenda for November 24, 2020 Page 3
5. Introduction to the Capital Improvement Plan.
(Matt Horn, Public Works Director)
Recommendation: Receive a report on the development of the Capital Improvement Plan
and capital project delivery.
COMMENT AND DISCUSSION
6. Staff Updates
7. Commission Communications
ADJOURNMENT
The next Regular Meeting of the Revenue Enhancement Oversight Commission has yet to
be determined.
The City of San Luis Obispo wishes to make all of its public meetings accessible to the
public. Upon request, this agenda will be made available in appropriate alternative formats to
persons with disabilities. Any person with a disability who requires a modification or
accommodation in order to participate in a meeting should direct such request to the City Clerk’s
Office at (805) 781-7100 at least 48 hours before the meeting, if possible. Telecommunications
Device for the Deaf (805) 781-7107.
Meeting audio recordings can be found at the following web address:
http://opengov.slocity.org/weblink/1/fol/61028/Row1.aspx
Revenue Enhancement Oversight Commission
Agenda Report Meeting Date: 11/24/20
Item Number: 3
DATE: November 24, 2020
FROM: Greg Hermann, Deputy City Manager
Prepared By: Ryan Betz, Assistant to the City Manager
SUBJECT: REVIEW PURPOSE OF THE REVENUE ENHANCEMENT OVERSIGHT
COMMISSION AND ELECT OFFICERS
RECOMMENDATION
1. Review the purpose and scope of the Revenue Enhancement Oversight Commission (REOC); and
2. Elect a Chairperson and Vice-Chairperson to serve for a one-year term.
DISCUSSION
Background
On July 15th, 2014, Council adopted an ordinance establishing the Citizens’ Revenue Enhancement
Oversight Commission (REOC), to review the half-percent sales tax revenues and expenditures, report
on the City’s stewardship of this general purpose tax, and provide recommendations directly to the City
Council regarding expenditures of these tax revenues as an integral part of the budget process. The
establishment of the REOC became effective following the passage of an extension to the Essential
Services Transaction (Sales) and Use Tax (Attachment 1, REOC Ordinance) during the November 2014
general election. The REOC is to consist of five members who must be residents of the City.
The November 4th, 2014 general election results indicated that voters in the City of San Luis Obispo
approved Ballot Measure G that stated:
To protect and maintain essential services and facilities – such as open space preservation; bike lanes
and sidewalks; public safety; neighborhood street paving and code enforcement; flood protection; senior
programs; and other vital services and capital improvement projects – shall the City’s Municipal Code
be amended to extend the current one-half percent local sales tax for eight years, with independent annual
audits, public goal-setting and budgeting, and a Citizens’ Oversight Commission?
Following certification of the election results, the Council and the People of the City of San Luis Obispo
adopted an ordinance amending Chapter 3.15 of the Municipal Code to extend the existing Essential
Services Transactions (Sales) and Use Tax (Attachment 2, Sales Tax Ordinance). This ordinance details
the full text of amended Chapter 3.15, which includes specific citizen oversight and fiscal accountability
provisions:
A. Revenue Enhancement Oversight Commission. A citizen's commission will be established to
provide transparency and maximize City accountability. The Commission will be responsible for
reviewing and making budget recommendations directly to the City Council regarding expenditures
City of San Luis Obispo, Title, Subtitle
from the essential services transactions (sales) and use tax and reporting annually to the community
on the City's use of these tax revenues.
B. Accounting and Tracking Expenditures. The funds collected through the City of San Luis Obispo
essential services transactions (sales) and use tax ordinance shall be accounted for and tracked by the
City Treasurer separately to facilitate citizen oversight.
C. Independent Annual Financial Audit. The amount generated by this general-purpose revenue
source and how it was used shall be included in the annual audit of the city's financial operations by
an independent certified public accountant.
D. Integration of the Use of Funds into the City's Budget and Goal-Setting Process. The estimated
revenue and proposed use of funds generated by this measure shall be an integral part of the city's
budget and goal- setting process, and significant opportunities will be provided for meaningful
participation by citizens in determining priority uses of these funds.
E. Annual Community Report. A written report shall be reviewed at a public hearing by the Revenue
Enhancement Oversight Commission, and a summary will be provided annually to every household
in the community detailing how much revenue is being generated by the measure and how funds are
being spent.
F. Annual Citizen Oversight Meeting. An invitation will be extended each year to the entire
community inviting them to participate in a forum to review and discuss the use of the revenue
generated by this measure. City staff will also be available to meet with any group that requests a
specific briefing with their members to discuss and answer questions about the revenues generated
by the measure and their uses.
Purpose and Scope of the REOC
The codified charge of the REOC is to review, report and provide recommendations. The REOC is an
advisory body to the Council that will provide important citizen oversight of local sales tax revenues and
expenditures. The REOC will not be making final decisions on City spending. REOC meetings will be
open to the public and serve as a venue for citizen engagement on local sales tax revenues and
expenditures. The REOC will also aid in community education and outreach about how much local sales
tax is received and where that revenue is being expended.
REOC Bylaws
The REOC bylaws contain the Commission’s purpose, and policies on conduct, membership, terms,
officers, meetings, attendance, quorum, voting, subcommittees, public records and other rules and
procedures (Attachment 1, REOC Bylaws).
These bylaws state that the REOC shall select a Chairperson and Vice-Chairperson from among its
members to serve for a one-year term.
ATTACHMENTS
1. REOC Bylaws
Citizens’ Revenue Enhancement Oversight Commission
The Citizens’ Revenue Enhancement Oversight Commission (REOC) has five members.
Members must be residents and registered voters of the City. When recruiting members, the
City seeks members that have experience with finance, budgeting, or municipal accounting,
though this is not a requirement of membership.
ARTICLE 1. MEETINGS
A. The REOC shall meet a minimum of four times per year to conduct its business.
B. REOC regular meetings will follow the diagram below and be integrated into the City’s
budget processes for the two‐year financial plan, fiscal year‐end, and financial plan
supplement. Meeting dates may change from year to year according to the actual
budget schedule.
REOC Bylaws Page 2
C. Agenda items shall be completed by 9:00 p.m. unless the consent of a majority of
commissioners agree to extend the meeting.
D. Regular meetings shall be held in the Council Hearing Room, City Hall, 990 Palm Street,
San Luis Obispo, California.
E. Special meetings may be called by a majority of the REOC, or by City staff in consultation
with the Chairperson, if additional meetings are necessary to accomplish the purpose
and duties of the Commission.
F. In the event that the REOC desires to hold all or any portion of a regular meeting at a
place other than the Council Hearing Room, then the place of such meeting shall be
posted on at the doors of the Council Hearing Room prior to the time designated for the
meeting in accordance with law.
ARTICLE 2. ELECTION OF OFFICERS
A. The commission shall select a Chairperson and Vice‐Chairperson from among its
members to serve for a one‐year term beginning with the first meeting following the
start of each fiscal year (July 1).
B. Commissioners shall serve as Chairperson or Vice‐Chairperson at the discretion of the
Commission.
C. The Chairperson shall preside at all meetings of the commission. The Vice‐Chairperson is
Chairperson in the absence of the Chairperson or in case of inability of the Chairperson
to act.
ARTICLE 3. CONDUCT OF MEETINGS
A. Commissioners should address questions through the chairperson.
B. Members of the audience should address commissioners or other persons present
through the chairperson.
C. Procedure for reviewing public hearing items:
After roll call the Chairperson shall announce to the public the procedures to be followed to
consider the items listed on the agenda and then proceed as follows:
1.The Chairperson shall introduce the items and ask for oral staff reports, as
appropriate.
2.The staff report previously submitted to the REOC shall be placed into the record
with all communications received regarding the item. Staff reports shall be
submitted for all public hearing items in a form acceptable to the Commission.
3.Members of the public wishing to speak on the topic of the agenda item shall be
invited to make a presentation. Public comment shall be accepted for agenda
items that are listed as presentations, business items, or public hearings.
4.Following public testimony on an agenda item, the public hearing or public
testimony portion of the meeting shall be closed to the public and discussion
confined to members of the commission; provided that the commission may
reopen the public hearing or invite additional testimony at any time prior to a
decision on an item on an affirmative vote of the majority of those members
present.
REOC Bylaws Page 3
5.The Commission, upon formal motion, shall take action on the item or
recommendation.
ARTICLE 4. QUORUM
A. Three members of the commission constitutes a quorum for the transaction of business.
B. No action of the commission shall become effective without receiving the affirmative
vote of a majority of the members present.
ARTICLE 5. VOTING
A. Except as otherwise provided in the San Luis Obispo Municipal Code and state law, no
motion or any other action shall be passed or become effective without receiving the
affirmative vote of at least a majority of members present.
B. Failure to receive such an affirmative vote shall result in failure or denial, as appropriate,
of the motion or other action.
C. Except as allowed under the Political Reform Action of 1974, any member abstaining
due to a declared conflict of interest shall not participate in the discussion of the items
or otherwise influence or attempt to influence in any manner the decision on the item.
D. All members, when present, must vote except when refraining from participating due to
actual or potential conflict of interest.
E. Commissioners not supporting a motion for action shall summarize the reason for their
vote.
ARTICLE 6. PUBLIC RECORDS
A. Records of all public hearings shall be made available to the public in the office of the
City Clerk.
B. Secretary – Duties: The secretary shall be a representative of the City Clerk’s Office, and
shall keep minutes of each meeting and shall record the official actions taken. The
records of all proceedings shall be available to the council and to the public.
ARTICLE 7. ATTENDANCE
A. Any member of the REOC who fails, for any reason, to attend three (3) regular,
adjourned regular, or specially‐scheduled meetings, within any 12 month period, shall
be reviewed by the Chairperson for possible referral to the City Council.
ARTICLE 8. FILLING VACANCIES AND REMOVAL OF MEMBERS.
A. Vacancies shall be filled for unexpired terms. The council, by majority action, may
remove any commissioner as provided in the City Charter.
ARTICLE 9. RULES, REGULATIONS AND PROCEDURES.
A. The Commission may adopt rules, regulations and procedures as required for the
transaction of its business. These rules shall become effective upon approval of the
council.
Revenue Enhancement Oversight Commission
Agenda Report Meeting Date: 11/24/20
Item Number: 4
DATE: November 24, 2020
FROM: Brigitte Elke, Finance Director
SUBJECT: CITY FINANCE – AN OVERVIEW
RECOMMENDATION
Receive an overview on City Finance and some of its terminology.
DISCUSSION
Background
Why does the City have different funds? What is a fund balance? How are City services financed? What
are the General Fund’s main expenditures? These are common questions asked by the public that
encounters Municipal Finance and governmental accounting for the first time. This report aims at
explaining some general topics and concentrates on the City’s main fund for supporting general services
and capital projects, the General Fund.
What is important to keep in mind is that a municipality has a mandate to provide services to its
community. From a financial perspective, it should do so in a manner that covers the cost to provide the
services and allows for prudent levels of emergency reserves. It must consider the long-term
ramifications of the cost of services especially in the realm of infrastructure maintenance.
Laws such as Proposition 13, the GANN Limit, and Proposition 218 further clarify taxation levels and
cost of services nexus.
Fund Accounting
In the private sector, sometimes separate companies are set up for legal liability or tax purposes. In the
public sector, separate activities are accounted for in separate funds to show accountability.
Thus, in government, individual funds are created because of laws, grant requirements, the revenue
source that pays for the services, or the desires of the governing body. All activity that has not been
assigned to a specific fund is then accounted for in the General Fund. As a result, most people find the
General Fund to be the most important fund as it contains uncommitted resources that may be used for
general purposes.
Governmental funds use the modified accrual method and expenditure classifications as Enterprise funds
(ex: water, sewer, transit & parking) use the accrual method of accounting and expense classifications.
Thus, we talk about expenditures in the General Fund and expenses in the Enterprise Funds.
City of San Luis Obispo, Title, Subtitle
Governmental Funds General Fund
Special Revenue Funds
Debt Service Funds
Capital Outlay Funds
Proprietary Funds
(Business-type Activity)
Enterprise Funds
(Water, Sewer, Parking, Transit)
Internal Services Funds
Fiduciary Funds Agency Funds – Whale Rock Reservoir
Trust Funds (specific purpose)
Where does the Local Revenue Measure fit it? As a General Fund revenue source, it is a sub-fund to
General Fund and only recognized separately for reporting purposes. The City tracks both the revenues
and expenditures of the Local Revenue Measure and provides that information to the Revenue
Enhancement Oversight Commission and community as part of the Annual Community Report. Those
reports are available online at slocity.org/budget.
The City’s Comprehensive Annual Financial Report (CAFR) does include information on the Local
Revenue Measure to meet the requirements identified within Chapter 3.15 (Essential Services
Transaction and Use Tax) of the City Municipal Code.
Fund Balance
In the private sector, this is commonly referred to as equity. The fund balance in any given fund is
essentially what is left over after the fund’s assets have been used to meet its liabilities. The portion of
the fund balance that is not restricted, committed, or assigned such as to reserve levels, is fittingly
referred to as “unreserved fund balance” and can be used for any purpose of the fund it is reported in. In
the City of San Luis Obispo, only the City Council can appropriate fund balance.
How are City Services financed?
Municipalities rely on several income streams to finance the services they provide to their citizens.
Unlike the State and the Federal government, no income taxes are received. Instead, cities rely on sales,
property, transient occupancy, utility users, and a variety of other taxes the government body levies
through voter approval such as a cannabis tax.
A municipality can also levy fees for services. The fee level should cover the cost of providing the
service, but the governing body has the option to reduce the level and subsides the service with other
revenue. The City’s financial policies, as adopted by Council, define the levels of cost recovery from
high – development related to low - Parks and Recreation programs. The following illustrates the
General Fund’s revenues as percentage of the 2020-21 budget assumptions.
City of San Luis Obispo, Title, Subtitle
The City of San Luis Obispo commissions a cost of services study every five years to connect fee levels
to the actual cost of the service. In the interim years, the fees are adjusted by the Consumer Price Index
for the Los Angeles/Riverside area.
This chart shows the General Fund revenue on September 30, 2020, as compared to 2019-20.
Getting to Know your Sales Tax
Sales tax continues to be the City’s largest revenue source. However, sales tax may cover several
different types of taxes and you will encounter various terms that define it. Let’s break it down:
Sales Tax
Assessed on tangible personal property such as household goods and allocated to the point of
sales. It applies to a transaction if:
Table 2: General Fund Revenues
Footnote Q1 Actual % Received Total Budget Q1 Actual
%
Received
Variance
from
prior
year
Tax and Franchise Revenue
Sales and Use Tax (July & Aug only)1 5,031,744$ 20% 22,853,783$ 5,147,376$ 23% 2%
Property Tax 655,814$ 1% 18,418,903$ 734,794$ 4% 12%
Transient Occupancy Tax 2,334,589$ 29% 6,267,000$ 1,800,251$ 29% ‐23%
Utility User Tax 1,187,531$ 20% 5,565,000$ 1,157,156$ 21% ‐3%
Business Tax 2 2,862,835$ 97% 2,853,740$ 2,890,955$ 101% 1%
Franchise Fees 77,798$ 5% 1,544,000$ 78,702$ 5% 1%
Gas Tax (Special Revenue Fund)225,826$ 22% 1,082,390$ 286,350$ 26% 27%
SB1 Gas Tax (Special Revenue Fund)156,038$ 19% 795,548$ 147,044$ 18% ‐6%
Cannabis Tax ‐$ 0% 400,000$ 114,859$ 29%
Total Tax & Franchise Revenue 12,532,175$ 19% 59,780,364$ 12,357,488$ 21% ‐1%
Fees and Other Revenue 3 6,023,828$ 24% 16,790,780$ 4,137,468$ 31% ‐31%
Grand Total 18,556,003$ 20% 76,571,144$ 16,494,956$ 22% ‐11%
2020‐21
2 ‐ Business license and tax certificate renewals are due before September 30th; therefore anticipated revenue for the year has been collected
3 ‐ FY2019‐20 includes a one‐time funding of $2 million from SB1090 Diablo Closure
1 ‐ Includes $146,000 in FY 20‐21 actuals that are from FY 19‐20 due to the sales tax deferral programs
2019‐20
City of San Luis Obispo, Title, Subtitle
1.) The seller’s registered place of business in California participates in the sale.
2.) Title to the goods passes to the customer within California.
Use Tax
Use Tax complements the sales tax and is applied to purchases of goods from out-of-state. It is
allocated to the place of use. With the onset of online sales and marketplaces such as Amazon
and eBay, sales tax was mostly omitted as the out-of-state sellers would not collect it and the
buyer would not remit it via the income tax filings. The 2017 U.S. Supreme Court decision in
South Dakota v Wayfair, Inc. (AB147) eliminated this issue and all sellers with annual gross
sales of $500,000 or more must collect the tax.
The local share of the use tax is allocated to the county (county pool) where the property is first
placed into functional use and then shared by all jurisdiction on a pro-rata share of taxable sales.
Transactions Tax and local Use Tax – Measure G
This is an additional tax levy on top of the Bradley-Burns local sales and use tax imposed by
individual cities or counties when approved by the local jurisdiction’s voters. The corresponding
law was adopted in 1969. The California Department of Tax and Fee Administration (CDTFA)
refers to these taxes as “District Taxes”. Measure G is a transaction tax and includes the
accompanying use tax.
The CDTFA administers sales, use, and transaction taxes. The agency collects revenues, enforces
compliance, and allocates revenue among local jurisdictions and the state.
City of San Luis Obispo, Title, Subtitle
SLO Sales Tax Distribution per April 1, 2021
Providing Services – Operating Budget
The City’s annual operating budget for the General Fund totals about $65 million and includes 54 service
programs spanning from Building and Safety, Development Review, Emergency Response, Aquatics,
Youth and Services, Police Patrol, Traffic Safety, Streets & Sidewalk Maintenance, Transportation
Planning and the Urban Forest to Accounting, Purchasing and City Administration. Many of these work
programs are multifaceted – they provide core services to the community, execute General Plan
programs, and contribute to Major City Goals that are determined by the City with each Financial Plan.
City of San Luis Obispo, Title, Subtitle
Revenue Enhancement Oversight Commission
Agenda Report Meeting Date: 11/24/20
Item Number: 5
DATE: November 24, 2020
FROM: Matt Horn, Public Works Director
SUBJECT: INTRODUCTION TO THE CAPITAL IMPROVEMENT PLAN
RECOMMENDATION
Receive an overview of the delivery process of the Capital Improvement Plan.
DISCUSSION
Background
The City's Capital Improvement Plan (CIP) is one tool that is commonly used to maintain or replace
existing assets as well as implement many of the City's future plans. The CIP enables the City to plan,
schedule, and finance capital projects to ensure cost effectiveness and conformance with established
plans and policies.
The City’s budget process guides the capital priorities through community input, Council goal setting,
Local Revenue Measure priorities, and the biennially adopted Major City Goal work programs.
The City’s CIP includes all planned infrastructure projects over the next five years. The first two years
identify those projects that are planned to be funded and/or completed during this time period. The latter
three years serve as the framework for future Financial Plans’ budgets. The plan represents a phased
approach to funding the projects needed to maintain the City’s infrastructure and major facilities over
the entire five-year period. The plan also identifies equipment replacement needs in the area of fleet and
information technology infrastructure.
Capital asset maintenance and replacement represent one of the fundamental functions of local
government. Many capital projects extend the life of existing City assets like streets, parks, bridges,
water and sewer pipelines, and plants. Other projects replace aging facilities and equipment. Finally,
some projects, representing community desires and Council priorities, are new projects intended to
enhance the overall quality of life of residents and visitors.
All the City's construction projects and equipment purchases of $25,000 or more are included in the CIP.
Minor capital outlays costing less than $25,000 are included with the Financial Plan operating program
budgets.
The City has ownership and maintenance responsibilities for many community assets. Those assets
include:
City of San Luis Obispo, Title, Subtitle
Parks: 23 parks or 530 acres of parkland as well as approximately 20,000 public trees in
the parks and streets
Equipment: 250 vehicles including cars, trucks and heavy equipment, 17 buses, and
numerous generators and small tools
Facilities: 230,000 square feet of public facilities and 3 parking structures
Roadways: 134 miles of roadway, 71 signalized intersections, 63 miles of storm drain
systems, and over 2,000 streetlights.
The City has a number of plans that guide growth, protect the environment and manage assets. Examples
of these plans include:
Guide Growth:
o General Plan including the Land Use and Circulation Element
o Specific Plans including the Orcutt Area, Mid Higuera, Airport Area, etc.
o Downtown Concept Plan
Protect the Environment:
o Climate Action Plan
o Bicycle Transportation Plan soon to be superseded by the Active
Transportation Plan
o Waterway Management Plan
Manage Assets:
o Pavement Management Plan
o Storm Sewer Management Plan
o Facilities Master Plan
The City maintains a long-term CIP list that identifies these needs with approximate cost for
implementation. When last updated this list of long-term needs was approaching one billion dollars of
planned investment into the community.
Capital Improvement Plan Budget Process
The process the City uses to define, review, select and fund CIP Projects is robust and always demands
tradeoffs. The Council defines policy objectives that are informed by Community and Advisory Body
input. Staff define project scope and estimate budget needs informed by Major City Goals, General Plan,
Specific Plans, Private Development project needs, Maintenance and Service Program Input, and Best
Management Practices for Asset Management. These projects are grouped together and presented to the
Revenue Enhancement Oversight Committee, Planning Commission, and Council for review and
approval.
Implementation
Once the CIP Budget is approved, project management and design oversight responsibilities are assigned
to either the CIP Engineering Program, Utilities Engineering and Project Management Staff,
Transportation Planning and Engineering , or one of the City's maintenance programs including Fleet
Maintenance Services, Facilities Maintenance Services, and Parks Maintenance Program.
In order to ensure that CIP Projects enhance community safety and are constructed in compliance with
industry practices, projects are required to comply with various design guidance documents including:
City of San Luis Obispo, Title, Subtitle
American Water Works Association Standards;
Caltrans Standards;
Manual for Uniform Traffic Control Devices;
Highway Design Manual;
Americans with Disabilities Act Guidelines;
National Association of City Transportation Officials; and
City Engineering Standards.
Once the projects' scope, schedule, construction documents (plans and specifications), and estimated
construction costs have been developed, the project will be presented to the City Manager or Council for
review and approval prior to advertisement for construction bids. Project bidding procedures must
comply with both the City's Municipal Code and the California Public Contract Code. Bids received are
evaluated based upon the Engineer's estimated construction cost both for overall project cost as well as
unit costs for different items of work. Engineer's estimates are developed using several methods. The
first and most used method is historic information from other City CIP projects or Caltrans. This method
works well for projects that the City routinely completes. Examples of projects that use historic data to
develop estimates include roadway paving or pipeline replacements. For more unique projects, the
project delivery team will estimate the labor, equipment, materials and profit a contractor may need are
estimated.
An example of a recent project that used this method was the Higuera Street Sidewalk Replacement that
required structural basement work to complete the sidewalk replacement. The goal of the Engineer's
estimate is to aid the contractor with bidding. After bids are evaluated, the lowest cost responsive bid
submitted by a responsible contractor is selected for contract award consideration by either the City
Manager or Council. If the contract is awarded, the construction management and inspection duties is
typically overseen by either the City's CIP Engineering Program or Utilities Engineering and Project
Management staff. Once the construction process is complete, the warranty period for the work is
started. The warranty period is typically one-year. During the warranty period the community has use
of the constructed facilities. Prior to the warranty expiration, staff re-inspect the work to ensure no
additional work is necessary.