CC 2012-11-27_08.f. Local Sales Tax Allocation Annual ReportMEMORANDUM
TO: CITY COUNCIL
FROM: STEVEN ADAMS, CITY MANAGER fr
SUBJECT: CONSIDERATION OF ANNUAL LOCAL SALES TAX
ALLOCATION REPORT AND 5-YEAR PLAN
DATE: NOVEMBER 27,2012
RECOMMENDATION:
It is recommended the City Council: 1) approve the Annual Local Sales Tax
Allocation Report; 2) approve additional recommended appropriations for FY
2012-13; and 3) approve recommended changes to the 5-Year Local Sales Tax
Plan.
IMPACT TO FINANCIAL AND PERSONNEL RESOURCES:
Revenue from the local sales tax in FY 2011-12 was $1,851,734, which is above
original projections. Therefore, additional revenues are available to be
programmed and appropriated. Revenues for FY 2012-13 are projected to be
approximately $1,879,510. This and projected revenues in future years of the 5-
Year Plan are based upon a conservative estimated annual increase of 1.5%.
The ending fund balance for FY 2011-12 is $1,736,274. A total of $3,314,894 in
FY 2012-13 expenditures are proposed, which will result in a projected ending
year fund balance of $300,890. This will maintain a reserve of approximately
16% of projected revenues. The proposed 5-Year Plan recommendations
maintain a balance of at least 15% each year.
There is minimal additional impact to staff resources when compared to the
previous 5-Year Plan for the Local Sales Tax funds. Funding is programmed for
major projects to include construction management. The recommendations are
designed to reflect the priorities set forth in the Critical Needs Action Plan.
Item 8.f. - Page 1
CITY COUNCIL
CONSIDERATION OF ANNUAL LOCAL SALES TAX ALLOCATION REPORT
AND 5-YEAR PLAN
NOVEMBER 27, 2012
PAGE 2
BACKGROUND:
In November 2006, the voters of Arroyo Grande approved Measure 0-06, which
established a half-cent local sales tax to meet City needs identified in the City's
long-range financial plan. The following four categories of needs were projected:
• Transportation projects, including upgrade of the Brisco/Halcyon interchange;
• Infrastructure improvements, including the street, drainage and creek
systems;
• Public safety needs, including Police and Fire Department facilities,
equipment and staffing; and
• Facility upgrades to meet Americans with Disabilities Act (ADA) requirements.
To ensure accountability, the measure included a provision requiring the City to
publish and distribute an annual report to each household on the revenues and
expenditures from the local sales tax proceeds. As a result, staff has prepared
the next annual Local Sales Tax Allocation Report, which is presented in
Attachment 1. The report consists of four pages. It is designed to be printed in a
fold-out format. It includes both actual expenditures from FY 2011-12 and
recommended expenditures for FY 2012-13.
While not required by the measure, staff has also maintained a practice of
annually updating the 5-year plan. This enables the Council to ensure that
immediate funding commitments are consistent with plans to achieve the long-
term goals of the original local sales tax measure. The recommended 5-year
Plan is presented as Attachment 2.
ANALYSIS OF ISSUES:
Changes to the Local Sales Tax budget for FY 2012-13 and to the 5-Year Plan
previously approved by the City Council include the following:
• It is recommended to reduce the carryover for sidewalk and cross gutter
improvements by $20,000. Additional funds were appropriated for the East
Grand Avenue sidewalk improvements in error due to a mistake in the
project balance. As a result, more funding is available in the project account
than anticipated. It is also recommended to combine the sidewalk and
cross gutter project with concrete replacement. These two projects were
previously separate to differentiate funding for contract projects and
supplies for in-house work. However, due to existing staffing levels, most
work is now contracted out. The recommendation will maintain $115,000 in
the budget for FY 2012-13 and over $70,000 for additional improvements
after the East Grand Avenue project is completed, which is still well above
previous funding levels.
Item 8.f. - Page 2
CITY COUNCIL
CONSIDERATION OF ANNUAL LOCAL SALES TAX ALLOCATION REPORT
AND 5-YEAR PLAN
NOVEMBER 27, 2012
PAGE3
• It is recommended to increase funding for the Police Station project by
$75,000 in FY 2012-13 and by $80,000 in FY 2013-14 in order to help
ensure sufficient funding is available for the proposed plan for a new Police
Station. The carryover amount is also increased by $10,492 to correct an
error due to the amount of expenses paid from tax increment funds
approved by the Successor Agency.
• It is recommended to increase funding for the Pavement Management
Program by $40,000 in order to fund the Halcyon Road and Fair Oaks
Avenue improvements.
• It is recommended to increase funding appropriated in FY 2012-13 for the
Le Point Street Parking Lot by $75,000 to replace funding used to pay for
lease costs that were previously budgeted from Redevelopment funds and
an increased cost for the parking lot lights. It is also recommended to
increase the amounts programmed in FY 2013-14 and FY 2014-15 by
$25,000 to address future lease costs. This recommendation is also
designed to address the goal communicated by Council to purchase the
land as soon as allowed for by the existing lease-purchase agreement.
• It is recommended to eliminate the carryover of $19,7 41 in funding for
replacement of the roof at the Elm Street Community Center. After
extensive study, it has been determined that the replacement of the roof on
that building will be complex and cost prohibitive. Given the age and
condition of the building, it is instead recommended to begin work on a plan
for replacement of the building. The existing plan includes $20,000 annually
for "Other City Facilities". It is recommended to designate this as the Elm
Street Community Center Project and increase the funding to $50,000
annually beginning in FY 2014-15 in preparation of future replacement of
the structure.
• It is recommended to add $20,000 for upgrades to the Corporation Yard.
Staff is preparing a plan to add an office building at the site and upgrade the
existing buildings for storage and maintenance. An overall funding plan for
the project will be prepared and presented to the City Council within the next
few months.
• It is recommended to eliminate the carryover of $97,242 for the Traffic Way
Extension overlay. This project was previously completed and the carryover
was an error.
• It is recommended to add $90,000 in FY 2012-13 for the El Camino Real
resurfacing project to complete the final payment. The project remains
Item 8.f. - Page 3
CITY COUNCIL
CONSIDERATION OF ANNUAL LOCAL SALES TAX ALLOCATION REPORT
AND 5-YEAR PLAN
NOVEMBER 27, 2012
PAGE4
within the budget, but actual costs turned out to be higher with regard to
street improvements and lower for water system improvements. As a result,
the remaining funds are Water funds that are not eligible to pay for the final
costs.
• It is recommended to add $25,000 in FY 2012-13 for the Alpine Street
project. Drainage improvements have been identified as needed prior to
completing the street resurfacing.
• It is recommended to increase funding for Drainage and Creek
Improvements from $30,000 to $45,000 in FY 2013-14 and $50,000 in other
future years. Due to the failure of the corrugated metal pipe on West
Branch Street, staff is preparing a City-wide plan to line other pipes
throughout the City. This change will help fund those improvements on an
ongoing basis.
• It is recommended to decrease funding for the East Branch Street Paulding
Wall project from $50,000 to $25,000 in FY 2014-15. A service club has
expressed an interest in taking responsibility for rehabilitation of the existing
wall. Therefore, these funds will be used exclusively for future extension of
the wall, which results in a lower cost projection.
• It is recommended to add $40,000 in FY 2013-14 for reinforcement work to
the Swinging Bridge, which has been identified as desirable in order to
extend the future life of the bridge.
ALTERNATIVES:
The following alternatives are provided for consideration:
1. Approve staff's recommendation;
2. Direct staff to make adjustments to appropriations and approve the
recommendation;
3. Provide direction to staff.
ADVANTAGES:
The proposed report will educate the community regarding the expenditure of the
local sales tax funds, will provide transparency, and will meet the City's legal
obligations as set forth in the original ballot measure. The recommended
expenditures increase funding for important projects, particularly street
improvements, the Police Station, and the Elm Street Community Center.
DISADVANTAGES:
No disadvantages regarding the recommendations have been identified.
Item 8.f. - Page 4
CITY COUNCIL
CONSIDERATION OF ANNUAL LOCAL SALES TAX ALLOCATION REPORT
AND 5-YEAR PLAN
NOVEMBER 27, 2012
PAGE 5
ENVIRONMENTAL REVIEW:
No environmental review is required for this item. Environmental review will be
performed individually for the projects identified within the funding report.
PUBLIC NOTIFICATION AND COMMENTS:
The agenda was posted in front of City Hall and on the City's website on
Wednesday, November 21, 2012.
Attachments:
1. Annual Local Sales Tax Allocation Report
2. Local Sales Tax 5-year Revenue and Expenditure Projections
Item 8.f. - Page 5
CITY OF ARROYO GRANDE
FY 2011-12/ FY 2012-13
LOCAL SALES TAX ALLOCATION REPORT
In November 2006, the voters of Arroyo Grande approved Measure 0-06, which
established a half-cent local sales tax to meet City needs identified in the City's long-
range financial plan. The following four categories of needs were projected:
• Infrastructure improvements, including the street, drainage and creek systems;
• Transportation projects;
• Public safety needs; and
• Facility upgrades to meet Americans with Disabilities Act (ADA) requirements.
To ensure accountability, the measure included a provision requiring the City to
Attachment 1
publish and distribute an annual report to each household on the revenues and expenditures from the sales tax
proceeds. As a result, this report summarizes all actual local sales tax expenditures for Fiscal Year 2011-12 and all
budgeted local sales tax expenditures for Fiscal Year 2012-13. Total costs for some items exceed the amounts
listed due to revenues provided from other sources.
If you have questions or would like additional information regarding any of the items or figures outlined in this
report, please feel free to contact City Hall at 473-5400.
LOCAL SALES TAX ACTUAL AND BUDGETED EXPENDITURES
FOR FISCAL YEARS 2011-12 AND 2012-13
FY 2011-12 FY 2012-13
Item Actual
Infrastructure
Newsom Springs Drainage Project $165,567
Improvements at Branch Mill Road and E. Cherry Avenue to correct drainage deficiencies-
constntction is complete and was funded primarily by private development.
Short Street Narrowing and Realignment $24,554
Improvements to Short Street to narrow the street and enhance pedestrian access -
construction is complete.
City Tree Inventory and Trimming Program $12,520
Matching funds for a State grant to prepare a City-wide tree invent01y and contract sen,ices to
be used for a comprehensive street tree maintenance program. Project is complete.
Montego Street Sidewalk Project $3,956
Preliminary design work to install sidewalks on the northeast side of Montego Street to
provide safe pedestrian access to Ocean View School from both sides of the street. The total
project cost is $259,000.funded entirely through a State grant.
Traffic Way Extension Resurfacing $2,758
Resurfacing of the Traffic Way e.x:tension south of Cherry Avenue-construction is complete.
El Camino Real Resurfacing Project $428,224
Resurfacing, utility, and sidewalk improvements on El Camino Real from E. Grand Avenue to
Oak Park Boulevard-the total budget was $2.1 million and construction is complete. The
remainder of costs were funded from Water, Sewer and Federal grant funds.
Pavement Management Program $1 ,069,312
The City's annual slurry seal and microsurfacing street maintenance and improvement
program. Over 60 streets have already been upgraded in FY 2012-13.
Greenwood Tract Resurfacing
Pavement reconstruction of the Greenwood Tract, located off of Branch Mill Road. The
project is complete.
$5,920
Budgeted
$0
$0
$0
$0
$0
$90,000
$1,021,693
$444,080
Item 8.f. - Page 6
LOCAL SALES TAX ACTUAL AND BUDGETED EXPENDITURES
FOR FISCAL YEARS 2011-12 AND 2012-13 (CONTINUED)
FY 2011-12 FY 2012-13
Infrastructure (continued)
Street Maintenance
Item
Funding for ongoing street maintenance and repairs conducted by in-house staff
Sidewalk, Crosswalk, Striping, and Cross Gutter Improvements
Funding for replacement and repair of damaged sidewalks and cross gutters, improvement to
crosswalks, and striping of streets and intersections.
Drainage and Creek Preservation Projects
Funding for improvements and repairs to drainage infrastructure and enhancements to the
City's creek system.
Retention Basin Maintenance
Ongoing maintenance of drainage retention basins conducted by in-house staff
Le Point Street Parking Lot Expansion
Expansion of the public parking lot on Le Point Street. Construction is complete. Additional
funding is for lease and future purchase of a portion of the property that remains in private
ownership.
Capital Project Planning Studies
Planning and engineering studies for projects when infrastructure deficiencies are identified.
Crown Hill ADA Ramps and Crosswalk
Construction of ADA ramps and crosswalk at Crown Hill and E. Branch Street -construction
is complete.
Americans with Disabilities Act (ADA) Retrofits
Program to systematically upgrade and provide ADA accommodations on sidewalks
throughout the City.
Alpine Street Resurfacing
Reswfacing portions of Alpine Street between Eman Court and Dodson Way in conjunction
with utility upgrades-construction is projected in Spring 2013.
Larchmont Drive Drainage Improvements
Installation of subswface drainage improvements to redirect ground water that has been
seeping through the asphalt onto the roadway-construction is projected in Spring 2013.
Larchmont Drive Street Improvements
Design of street resurfacing on Larchmont Drive when drainage deficiencies have been
corrected. Total projected cost of the improvements is $150,000. The remainder of the
funding is programmed in FY 13-14, when the project will be constructed.
Colina Street and Via La Barranca Drainage Improvements
Construction of an underground drainage system to collect and discharge rising ground
water--construction is projected in Spring 2013.
Platino Lane and Oro Drive Inlet
Construction of an underground drainage system to collect and discharge rising ground
water--construction is projected in Spring 2013.
East Grand Avenue Underground Utilities
Cost for installation of street light poles in association with undergrounding of utilities on East
Grand Avenue.
Page 2
Actual Budgeted
$53,027 $97,700
$46,557 $115,000
$44,233 $45,767
$25,700 $26,214
$100,267 $100,000
$3,750 $10,000
$0 $20,000
$0 $40,000
$0 $75,000
$0 $30,000
$0 $25,000
$0 $15,000
$0 $50,000
$0 $50,000
Item 8.f. - Page 7
LOCAL SALES TAX ACTUAL AND BUDGETED EXPENDITURES
FOR FISCAL YEARS 2011-12 AND 2012-13 (CONTINUED)
FY 2011-12 FY 2012-13
Transportation
Traffic Model Update
Item
Update of the Citywide traffic model to assist in update of the City's General Plan and to
improve the ability to prepare traffic analysis for design of improvements and assessment of
project impacts.
Digital Speed Limit Sign
Installation of digital speed limit sign on Huasna Road at the entrance to the City to slow
traffic entering the City at the Strother Park area.
Castillo Del Mar Extension
Constmction, widening and drainage improvements to extend Castillo Del Mar Road from
Orchard Street to Valley Road. The initial cost is for matching funds for a bike path
associated with the future roadway, which has been completed.
Public Safety
Five Cities Fire JP A
Costs associated with the Battalion Chief position to perfonn training and administration
functions and enhancement ofsen,ices throughfonnation of the Five Cities Fire Authority.
Emergency Operations Center
Equipment, supplies and staffing assistance necessary to prepare the City's Emergency
Operations Center (EOC) for disaster response operations.
Fire Aerial Apparatus
The City's portion of costs for matching funds for a Federal grant to purchase the new Five
Cities Fire Authority ladder tmck.
Police Station Upgrade
Initial funding for feasibility study, design and costs to upgrade and relocate the City's
Police Station. Total costs are anticipated to be approximately $6 million. The remainder of
funding is proposed to come from long-term financing and sale of existing property.
Construction is projected in Fall 2013.
Narcotics Task Force
City's costs for participation in a countywide narcotics enforcement unit.
Police Firing Range
Upg~ades to the Police firing range to address facility needs and reduce future cleanup costs.
City Facilities
City Hall Complex Upgrade
Upgrade and relocation of City Hall to consolidate staff and address ADA, space and
structural issues, including development of automated document storage system. A portion of
costs are to fund ongoing debt sen, ice on the improvements already completed.
Corporation Yard Upgrade
Repair and upgrade of Corporation Yard facilities, including replacement of offices,
painting, roof improvements, building exterior and parking areas. The remainder of costs
are projected to be paid for from the Water and Sewer Funds and sale of land.
Miscellaneous
Sales Tax Administration and Mailing of Annual Report
Costs for sales ta.x consultant services and preparation and mailing of this report.
Page 3
Actual Budgeted
$11,465 $13,535
$0 $10,000
$0 $19,000
$115,000 $117,300
$1,000 $5,000
$21,163 $21,163
$57,846 $737,153
$24,000 $24,000
$0 $40,000
$70,448 $35,289
$0 $30,000
$4,296 $7,000
Item 8.f. - Page 8
LOCAL SALES TAX ACTUAL AND BUDGETED EXPENDITURES
FOR FISCAL YEARS 2011-12 AND 2012-13 (CONTINUED)
Summary Totals
Total
Beginning Fund Balance
Projected Revenues
Projected Ending Fund Balance
Oily qf .tl.rrogo Grande
City Manager's Office
300 East Branch Street·
Arroyo Grande, CA 93421
POSTAL CUSTOMER
FY 2011-12 FY 2012-13
Actual Budgeted
$2,291,563 $3,314,894
$2,176,103
$1,851,734
$1,736,274
$1,736,274
$1,879,510
$300,890
Pre-Sort Standard
U.S. Postage
PAID
Arroyo Grande
California
Permit #37
ECRWSS
ARROYO GRANDE, CA 93420
Item 8.f. - Page 9
Attachment 2
LOCAL SALES TAX REVENUE AND EXPENDITURE 5-YEAR PLAN
FY 11-12
Item Actual Carryover FY 12-13 Total FY 12-13 FY13-14 FY 14-15 FY 15-16 FY 16-17
Strother Park Sign $0 $10,000 $0 $10,000 $0 $0 $0 $0
Castillo Del Mar $0 $19,000 $0 $19,000 $50,000 $0 $0 $0
Traffic Model Update $11,465 $13,535 $0 $13,535 $0 $0 $0 $0
Brisco/Halcyon Interchange $0 $0 $0 $0 $0 $200,000 $200,000 $200,000
Subtotal Transportation $11,465 $42,535 $0 $42,535 $50,000 $200,000 $200,000 $200,000
Pavement Management $1,069,312 $21,693 $1,000,000 $1,021,693 $525,000 $550,000 $575,000 $600,000
Sidwalks and Cross Gutters $46,557 $50,000 $65,000 $115,000 $65,000 $65,000 $65,000 $65,000
Street Maintenance $53,027 $97,700 $97,700 $100,000 $100,000 $100,000 $100,000
ADA Ramps $20,000 $20,000 $40,000 $20,000 $25,000 $25,000 $25,000
Montego Street Sidewalk Project $3,956 $0 $0 $0 $0 $0 $0 $0
Crown Hill Crosswalks and Ramps $20,000 $0 $20,000 $0 $0 $0 $0
Project Studies and Planning $3,750 $0 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
El Camino Real $428,224 $0 $90,000 $90,000 $0 $0 $0 $0
East Branch Paulding Wall $0 $0 $0 $0 $0 $25,000 $50,000 $0
Short Street $24,554 $0 $0 $0 $0 $0 $0 $0
Alpine Street $0 $50,000 $25,000 $75,000 $0 $0 $0 $0
Tree Inventory and Trimming $12,520 $0 $0 $0 $0 $0 $0 $0
Traffic Way Extension $2,758 $0 $0 $0 $0 $0 $0 $0
Greenwood Tract $5,920 $144,080 $300,000 $444,080 $0 $0 $0 $0
Larchmont Street Improvements $0 $0 $25,000 $25,000 $125,000 $0 $0
Underground Utilities $0 $0 $50,000 $50,000 $100,000 $50,000 $0 $0
Pecan Place $0 $0 $0 $0 $50,000 $0 $0 $0
Swinging Bridge Reinforcement $0 $0 $0 $0 $40,000 $0 $0 $0
Le Point Street Parking Lot $100,267 $0 $100,000 $100,000 $100,000 $100,000 $100,000 $125,000
Subtotal Street Improvements $1,750,845 $305,773 $1,782,700 $2,088,473 $1,135,000 $925,000 $925,000 $925,000
Drainage/Creek Protection Projects $44,233 $5,767 $40,000 $45,767 $45,000 $50,000 $50,000 $50,000
Retention Basin Maintenance $25,700 $0 $26,214 $26,214 $26,738 $27,273 $27,819 $28,375
Newsom Springs $165,567 $0 $0 $0 $0 $0 $0 $0
Colina & Via La Barrance Drainage $0 $15,000 $0 $15,000 $0 $0 $0 $0
Larchmont Drainage $0 $30,000 $0 $30,000 $0 $0 $0 $0
Platino Lane & Oro Drive Inlet $0 $0 $50,000 $50,000 $0 $0 $0 $0
Other Drainage Projects $0 $0 $0 $0 $0 $0 $0 $50,000
Subtotal Drainage Improvements $235,500 $50,767 $116,214 $166,981 $71,738 $77,273 $77,819 $128,375
Fire JPA $115,000 $0 $117,300 $117,300 $119,646 $122,039 $124.480 $126,969
Emergency Operations Center $1,000 $0 $5,000 $5,000 $2,500 $2,500 $2,500 $2,500
Fire Apparatus $21,163 $0 $21,163 $21,163 $21,163 $21,163 $21,163 $0
Police Station Expansion $57,846 $472,153 $265,000 $737,153 $180,000 $180,000 $180,000 $180,000
Narcotics Task Force $24,000 $0 $24,000 $24,000 $24,000 $24,000 $24,000 $24,000
Police Firing Range $0 $20,000 $20,000 $40,000 $20,000 $20,000 $0 $0
Subtotal Public Safety $219,009 $492,153 $452,463 $944,616 $367,309 $369,702 $352,143 $333.469
City Hall Upgrade $70,448 $15,289 $20,000 $35,289 $20,000 $20,000 $20,000 $20,000
Corporation Yard Repairs $0 $10,000 $20,000 $30,000 $20,000 $20,000 $20,000 $20,000
Elm Street Community Center Roof $0 $0 $0 $0 $0 $0 $0 $0
Elm St. Community Center Upgrade $0 $0 $0 $0 $0 $50,000 $50,000 $50,000
Subtotal City Facilities $70,448 $25,289 $40,000 $65,289 $40,000 $90,000 $90,000 $90,000
Transfer to Address State Takeaways $0 $0 $0 $0 $250,000 $250,000 $250,000 $250,000
Annual Audit and Report $4,296 $0 $7,000 $7,000 $7,500 $7,500 $7,500 $8,000
Subtotal Other $4,296 $0 $7,000 $7,000 $257,500 $257,500 $257,500 $258,000
Total $2,291,563 $916,517 $2,398,377 $3,314,894 $1,921,547 $1,919.475 $1,902,461 $1,934,844
Projected Revenue $1,851,734 1,851,734 1,879,510 1,907,703 1,936,318 1,965,363 1,994,843
Annual Change to Fund Balance -$439,829 -546,643 ·1,435,384 -13,845 16,843 62,902 59,999
Balance $1,736,274 $300,890 $287,045 $303,889 $366,790 $426,790
Percentage of Projected Revenues 16% 15% 16% 19% 21%
Assumes: 1.5% annual sales tax growth
FY 11-12 Beginning Fund Balance $2,176,103
Item 8.f. - Page 10