HomeMy WebLinkAboutMinutes 013189 - Special Mtng ATASC'ADERO CITY COUNCIL
SPECIAL STUDY SESSION
TUESDAY, JANUARY 31 , 1989, 5:00 P.M.
Meeting was called to order at 5:00 p .m. by Mayor eorgeson
followed by the pledge of allegiance .
ROLL.... CALL
Councilwoman !'Mackey, Councilmen Lilley , Shiers, DF= x tier and
Mayor Bor_.geson
1 . DISCUSSION AND REAFFIRMATION OF CAPITA. IMPROVEMENT
PRIORITIES, THEIR FINANCING AND DIRECTION TO PROCEED.
Ray Windsor- , City Manager- , reported that October '7th he had
indicated that the Architect Mr . Levin was prepared to make
a pyre-Mentation to Council on his preliminary design. He had
made several comments about ghat was considered to be of
importance on addres-.inn the issue of the police facility
acrd it5timing . Financing the additional money required to
complete the project would not be easy but can be done and
Mr . Windsor would like tea suggest assuming Courrc.: il continues
to move ahead with the project that he be directed to come
r_rcr with Suggested alternative methods of funding whatever
dollar- difference remair+s . In the inter-vPniing tirnee several
other projects have come to Council ' s attention and we have
had a couple of meetings related to the Capital improvement
budget . As a result of that we identified the three major
projects as the Police Facility, the Lake Pavilion-Community
Center , and the lake property purchase. Council has not
acted formally on that Capital Improvement Program and will
not do so until you get to the mid-year budget review which
is the other item on the agenda tonight . Meeting date and
time? will be set tonight. January 10th a memo was sent to
council . The Council Finance Sub-.Committee has been
pursuing a number of issues since its inception. Foremost
is the question of identifying those projects which have the
highest priority both in need and funding . Council has>
already endorsed the committee 's recommendations as part of
the draft capital investment program by designating the
police facility, lakepark pavilion-community canter , and
lake park lots purchase as its highest priorities . There
are three major questions to be answered . First , is long
term debt financing a reasonable, 'feasible and acceptable
method to address capital needs? Second , are the police
facility, Pavilion and lots purchase the priorities to be
addressed by such funding? And third , how much debt
financing is prudent given our existing and projected fiscal
picture
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In his opinion it is time these questions were resolved ,.by
the full Council so that we can move forward in addressing
some of our needs . The requested Council study .
session will include financing specialist (Brad Kerwin of
First California Regional Securities) and police facility
architect , Rod Levin.
It would be hard to address in any meaningful way the
question of the Pavilion without knowing exactly what we
could do with it . Whether in fact , it could be rehhabed or
whether it be more prudent to just demolish it and start
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from scratch . Mr . Levin was hired on a temporary basis to
come back with some sketches that he will be going over
in this meeting . Mark Joseph the Admin. Services Director
prepared a memo ( included in agenda packet ) which said
that we believe that looking at the budget at this time
vie could recommend $175,000 a year debt financing for the
Cit:, and as a result of that Mr . Windsor called Mr . Kerwin
amid asked what the city could expect to be able to fund
with that Find of annual debt payment and Mr . Kerwin has
come up with some figures of $1 .755 million which would
include the project cost=, whatever- those projects are
of $1 .427 million. The reserve fund of $175,500. Cost
of issuance and discount for the bond issue of $87,750 and
funded interest of X64 ,667. That makes the total of
$1 .755 million dollars . In addition to that in the last
day Mr . Windsor and Mr . Joseph have been working on the
budget update.
At this time Mr . Windsor, City Manager , gave Council Member�:i
a copy of The General Fund , FY 89z Budgeted VS Projected
expenses and revenues. (Copy is attached to agenda packet
in City Clerk ' s Office) The projection is that we expect
to end lrp at the end of the fiscal year with approximately
$232,398 more than we had projected initially. On the
expenditure side all the allocations that were made by
Council will in fact be spent by the various departments.
There is a $370,000 one-time reimbursement for PERS -For
overpayment . There is a cost increase of $45,000, for
Health Insurance and miscellaneous increases some of which
are projected and have not yet been spent . The fund balance
for the 88--89 year as of :June 30 could be as high as
$445,760. If Council agrees with the recommendation for
debt financing with the annual payment of $175,000
could come out of that amount and would still leave
$270,000+ for other allocations . This is predicated on
their strong recommendation that Council continue to hold
a minimum of $1 million dollars in the general fund balance.
This will be gone over again as part of the mid--year- budget
review.
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At this time Mr . Windsor introduced Mr . Rod Levin for his
report and analysis of the lake pavilion and to give Council
his recommendation on the proposed alternatives and cost
estimate.
Mfr . Levin provided copies of the Feasibility Study for the
Atascadero Lake Pavilion. (attached to agenda in City
Clerk ' s Office) . He reviewed this study with the Council .
Mayor Horgeson asked City Manager , Ray Windsor , for the
parameters of this meeting because if they are going to go
into the Capital Improvement Projects such an the Pavilion
in any detail at all , Council did not receive these books
until late this afternoon. She feels that the Council is
at a disadvantage and needs to know what the City Manager
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wants from the Council .
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Mr . Windsor apologized for the tardiness of the materials,
saying the truth of the matter is that Mr . Levin has
worked very hard in the last three weeks to pull all of
this together" to get a report . Obviously he wouldn ' t expect
Council, to make a decision tonight . He had hoped that as
a result of this meeting three things would occur . The
first was that council would see fit to direct, recognizing
that Council couldn ' t take formal action tonight , but to
give some indication to staff that council would direct the
architect to go ahead and complete working drawings and the
specifications for the police facility so that he could go
out to bid on that and determine what the exact costs are
going to be. The second was that he was hoping that
direction was going to be given for staff to put together
a request for proposal leading up to the retention of an
architect that would now build upon the work that has been
done by Mr . Levin. Obviously, in order for that to happen,
Council needs to be more specific in which direction it
wants to go whether in fact it wants to retain the building
or to tear it down. He realizes that Council may not make
that decision tonight . The third direction Mr . Windsor
is looking for was related to the land lot purchase at
lake park with some indication of perhaps selecting out
further priorities from the lots that have been identified
with the understanding that we begin the appraisal process
or initial contact with the property owners concerned to see
if in fact they are still in a selling mode. He realizes
that this may not happen tonight either . He doesn ' t
expert Council to make a decision tonight , that is why it
is a study session.
Mayor- Horgeson stated she understands that this is a study
session and that these items will come back on a future
agenda as an agenda item for Council to take action on.
Councilwoman Mackey asked about the holding facility for the
police department .
Mr . Levin reported that his firm is preparing a 4 hour
holding facility. With the 24 hour holding facility we
must have the ability to feed the prisoners and there are
certain additional facilities that are required for us for
Longer term holding . The four- hour detention plan is a
minimum facility and is not meant to take the place of a
county jail which houses prisoners for periods up to one
year . This becomes the least expensive plan for holding
prisoners.
Mayor Borgeson stated that in October 7, 19ee the cost
for the Police Facility as approximately $75 per sq .
foot .
Chief McHale said he believed the last estimate was about
$82 based on the analysis done by the contractor who was
haired by Mr . Levin.
Councilman Lilley felt it might be helpful if council
reviewed the bidding as far as the numbers, the cost of
acquisition of the site, what is envisioned in phase I and
then phase II so that council has that background before
them.
Chief McHale replied that initially the site and building
was Nought for $640,000. It was estimated to be valued at
$662,700+ at the time it was bought . The deal at the time
seemed like a good one. The shell as it stands which is
basically tilt-up construction would cost about $30 a sq .
foot to build so we have some value in that and it is in
good order and has been assessed by the engineers hired by
Mr . Levin as being structurally sound although it will
require a few brackets here and there which will be
included in the building renovation process .
Mr . Levin stated the total project as recommended is
estimated at $984,434 which includes a 5% contingency.
Phase I if you were to delete all: the outside site work
and the embellishments on the building (entrance would have
to be changed ) that price would be $749,273. This also
includes the deletion of the holding facility.
Mayor Borgeson asked if the $984,434 does include the 5%
contingency fee? Mr . Levin responded yes .
Mr . Levin continued by saying that Phase I is the "bane
bones" approach and deleting the holding facility. Phase
II is putting all that back in at a later date. That
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total would come to $324,775. What you are saving by
doing it all in one phase is over $100,000 and that is
debatable because if you don ' t do that work until 10
years down the line that could be even more expensive.
Councilman Dexter asked if that would also delete the
parking area outside . Mr . Levin responded yes, landscaping
and paving
Mayor Borgeson stated that in the report for the entire
project "R the cost includes all off site and on site work,
all exterior building embellishments , etc . This does not
include interior furnishings , radio and telephone communica-
tion equipment, Mr . Levin said furnishings were not
included which would be filing cabinets, desks , chairs etc .
Mayor Borgeson asked if this included architect and
engineering fees' Mr . Levin said no . She then asked if
this included project funding costs? Chief McHale said
no it did not .
Flay Windsor , City Manager , said he hoped Council would see
fit if not this evening , in the near future to allow Mr .
Levin to go ahead with the working drawings on the full
facility with the Understanding that at the time it is
bid , it could be bid with alternates depending on what
concerns the Council still had so that when we get the
construction casts you can then fully appraise that impact
on the financing .
Councilman Lilley said we have estimates as to cost , we have
acquired this property, we have done preliminary drawings,
it seems to him that even though the tab is somewhat
shocking to all of us, that it is time to get to the point
where we can get working drawings and specifications and
get, an actual bid in the hopes that we can find exactly
where we are and we are committed to do that because of
what has been thus far . Maybe we should try to expedite
that process this evening . It doesn ' t commit us signing
a construction contract . We have to find out ultimately
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what this is going to cost .
Councilwoman Mackey said it wouldn 't commit us to alternate
I or A at this time.
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Councilman Dexter said he would go along with Councilman
Lilley ' s suggestion that we go ahead and authorize the
architect to continue with the working drawings so that
we know what we are looking at .
Mayor Borgeson stated she is hopeful that we get some bids
that are below this so that we can get on with this
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project .
City Manager Windsor said that the facility is never going
to eget cheaper and the longer we wait the more expensive
it ' s going to become. Beyond that we ' ve identified the
fact that we ' re holding back on the installation of the
enhanced 911 system and while that could run in the
neighborhood of $12,000-$20,000 that ' is still the amount
of money the city will have to put out if we install it
here and eventually moue into the new facility. We can ' t
be without that , there is a serious question of liability
as well as efficiency. It isn 't a prudent expenditure of
funds for us to go ahead and have it installed , which is
done free initially here and then move out 9 months to
one year or whenever and have to face that cost again.
It is a definite incentive for us to move forward .
Councilman Dexter called the Council ' s attention to the 11
different proposals that have come to them. Every
single proposal that has been gone over in the past 10
years has increased in coast as the time has moved on. It
isn ' t going to get any less. This proposal gives us a
larger facility, certainly more ideally designed facility
than anything that has been looked at thus far . For that
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reason he would like to see the immediate approval of
j the architect ' s working on the drawings and getting those
back to the council as quickly as possible so that they
can ego through plan check and get them into bids .
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Councilman Shiers stated he concurred with Councilman
Dexter 's comments . It is time to move ahead with these
drawings and feels that it is a high priority in the
capital improvement budget .
Mayor Borgeson said she thinks that the council direction
has been stated . This will come back to the Council on
February 9th .
Councilman Lilley asked Mr . Levin about the possibility
of a second story on the pavilion. It has been abandoned
in the sketches. He wanted to know what Mr . Levin ' s
thoughts were about the wisdom or lacks of wisdom of a
potential two story building .
Mr . Levin said that the two story affair based on keeping
the present structure is a difficult one to deal with in
a sense that the lake water is up to just about the floor
level of the lower area now and that is where there are a
lot of problems with the structure with the water penetra-
ting that lower level . A lower deck: that is probably mid-
height would work. better . A first he thought there was
room for that but since then he has made three visits and
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water is definitely up into that area of the lower floor . If
you were to demolish the present facility and construct a
new building , council may wish to consider an alternative
I` to raise the structure to a much higher level which places
it closer to the parking and allows for better drainage
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and would allow for a second or lower story. One of the
reasons why they are shying away from the lower story in
the present building is that is not a fire rated structure .
The building would have to be fire sprinkled both levels and
you are looking at $2 per sq . foot for installation of the
fire sprinkler- system and probably more in that present
building . It looked pretty when he sketched it , but it .lust
doesn ' t work that easily with that old structure so that
idea or concept was abandoned . The two story concept could
be used in a new building .
i Councilwoman Mackey asked if a new building was built if it
Would have to be fire sprinkled' Mr . Levin said no if we
went to a fire rated system which is very easy to do , and
not that costly you could save probably eo% of the
sprinkling costs.
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Mr . Windsor asked Mr . Levin if we went to a new facility
could you build it in such a way to allow a second or third
story at some time in the future? Mr . Levin said
I absolutely. A new structure allows us the freedom to do
many things. He can see being closer to the water and not
so high up . The original pavilion had a bath house and
shower on the lower floor .
Mr . Windsor said it seems that with limited resources the
kinds of things envisioned for that facility if it is up-
graded and/or replaced still. mept the minimum of a
community center . He would love to see a building that is
for that purpose only, but he thinks that we have to some
flexibility in the use of a facility like that . The idea
was that perhaps it would lend itself to banquets such as
the one that was referenced by Councilman Dexter ( the
Chamber- installation dinner ) but also could be used for
various types of activities that now go on in this building .
He still feels that what Mr . Levin is defining in terms of
the sketches is, a pavilion/community center .
Mr. Levin said that the assembly area would be capable of
handling 514 occupants based on 7 sq . feet per occupant .
240 sq . feet for dining based on 15 sq . feet per occupant ..
Alternate II the assembly area would accommodate 681
occupants based on 7 sq . feet per occupant for dances and
the like. 318 occupants for dining based on 15 sq . feet
per occupant .
Councilman Dexter said he agreed with Mr . Windsor , that we
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would have the opportunity to make it a combination facility
if we built a new building . It makes good sense.
Councilman Shiers asked about the statement that one of the
assumptions was that the Pavilion would not compete with a
recreational complex . What forms of competitions did you
have in mind?
Mr . Levin said this facility was not to compete with the
community center even though there is a bit of overlap
with the programs that the Parks and Recreation Department
has provided us for both the Pavilion and the Community
Center . Some of it was a little difficult to separate out .
Probably because a community center would probably serve a
hiraher- occupant load and being the community center You
would be expected to either a larger assembly room or
probably a variety of meeting and activity rooms that might
be a little more than what you have here. This particular
facility provides for just about all of the programs that
the parks and recreation committee has set out; for the
Pavilion.
Councilman Dexter stated that this might allow us to make a
phased program for both the pavilion and the community
-enter and might be able to add another building at the
lake park, that would accommodate additional programs that
are not able to be taken care of at the pavilion.
Mr . Levin said that is a point in favor of demolishing the
existing building and building a new one because you only
have so many funds You Gould start out within a phasing
program.
Mayor Horgeson said she had to go along with Councilmen
Dexter and City Manager Windsor ' s statements that
the pavilion could be seen as a community center- . We=
are hearing from a lot of people in town that they want
a teen center . If we start accumulating some land for
a community center , maybe 20 years from now, we might
get it all together- and get a community center . We need
something now, it is imperative that we get something
for the community and especially for the youth .
Mr . Windsor said this ties in with Mr . Kerwin ° s presentation
because if Council is disposed to do something with the
Pavilion it goes back to the concept of economies of scale
when you look at long term finance. If we are going to do
several capital projects it is best to combine them and get
the '"best bang for the buck" . Also even though the Pavilion
is not even started it is conceptual in nature. There are
marry :steps that have to gone through before you feel
comfortable with what may be bidded, then actually
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constructed . You are certainly looking into the 1989-90
fiscal year before anything occurs, but as Mr . Kerwin will
tell you it doesn ' t mean you can ' t go ahead with your
financing so that those funds are ready for that use when
you are ready to go .
Mr . Kerwin presented council members with a 6 page document
regarding 15 or 20 year debt service for maximum annual debt
service of $175,000. He discussed this document with the
Council .
City- Manager Ray Windsor stated that there are definite
benefits from doing this, particularly given the size of the
projects that we are talking about . For the City, we have a
healthy reserve right now but for us to take that and pay
cash for a police facility is taking an awful risk with the
near future, not to say the long term future of the
community. If you can combine those in some way to maintain
a healthy reserve and still have the facilities that you
need , it seems the prudent way to go . That is being
fiscally responsible.
Councilman Shiers said we need to make sure that the
facilities that we can get with this will meet the goals
that we have at the same time too . He asked Mr . Kerwin
about the rates of interest on borrowing $850,000. Mr .
Kerwin said it could be lucked up for about 9.25 to 9.5% .
If you issue the debt , you have at least pots of money to
invest . One is the reserve fund which is 10% of the issue
and that is your money and is there to protect the certifi-
cate' holders in the event you default and don ' t make a
payment . Then a trustee will tap into that and pay them.
But you ' re not going to miss a payment so at the end of the
whole thing that money with all its interest comes back to
you. Tie the reserve fund up long term where you can get
the best rate.
Mayor- Borgcson asked isn ' t one of the disadvantages of
certificates of participation the front end administrative
costs`' Mr . Kerwin replied no , he didn ' t see that . There its
an on-going cost which can be paid out of interest earnings
for a trustee but there is the initial cost of doing the
issue but in any borrowing there is the initial cost because
that is when the borrowing takes place.
Gere Sibbach, City Treasurer , stated there is a spread of
about 2% between wheat you can invest the money in and what
you can borrow it at . But Council shouldn 't focus on
that . You are only talking about a reserve fundof
probably a maximum of $175,,000 so your 2Y. spread on that
mould be $5500 per year . He also stated it usually is
advisable when you are considering debt to look for some
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kind of a self-liquidating type of thing . For example,
Council should look for a revenue source for the police
department , possibily consider enacting a public safety
tax to be voted on. That is something that has some
appeal to a lot of people. On the pavilion that is a
different story. If you could have a convention center
type of situation where you can bring in business and you
had more bed tax or sales tax or your business license fees
went up , then it is possibile that you could generate
enough new revenue that it would be able to contribute
towards the debt service. He has doubts about the interest
rate charged - 7.5% sounds fairly cheap for the City
right now considering there is no credit rating for the
City . You might have to buy some credit enhancement which
might run you 112 a percent . You ought to identify
your revenue source for paying this debt hack very early
before the issue goes.
Mayor Borgeson asked Mr- . Sibbach when he was talking about
credit enhancement if he could explain more. He replied
there are different things you can do . You can buy
municipal bond insurance, some of them you pay a percentage
of the original issue. There are letters of credit . If
there is a default , the bank would have to step in and pay
off the creditors. This means that you are not selling them
just on the faith and credit of the City of Atascadero .
Mayor Borgeson asked Mr . Kerwin if in buying land , since it
goes up in value, would it make sense for a bond issue such
as this? Mr . Kerwin said it is done all the time for land
acquisition; lands , buildings and equipment . Parks are 'done
that way also .
Councilman Shiers said that is an issue of looking at
benefits vs . costs . As Mr . Sibbach noted it can be
difficult to measure the benefits of something like the
police facility. Since he is a member of the Finance
Sub-Committee he would like the rest of the council to
think about the cost of any debt financing if they do
decide to go that way. If we decide to tie up a $175,000
a year to make debt service payments or to pay off our
financing then what the Council needs to think about
is what other things could the City have purchased with
that $175,000 per year . if we can ' t buy something as
good as we are getting , it might make sense to go ahead
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and do it . What are the Council ' s highest priorities?
If we have to give up something , what are we willing to
give up in order to do something like this ,
City Manager Windsor said he understands what Mr . Shiers
is saying and is in general agreement . One of the things
that Mr . Windsor and Mr- . Joseph were looking at was what
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kind of growth are we seeing in the general fund that
perhaps would offset at least a portion of this. They
believe that half of that $175,000 can in fact can be
taken out of the annual growth factor which comes from
enhancement of the property tax and sales tax . That is
a very conservative figure just as the $175, 000 is extremely
conservative. There is no question that $175,000 and
that commitment which you have never done before means
that it won ' t be used somewhere else. So something may have
to suffer as a result of that , and that is in fact a part of
what you will have to struggle with when you move into the
new budget cycle.
Mayor Borgeson said jumping back even one step further we
have to look at without debt financing what we are going
to be able to accomplish and we have to look at that very
hard .. Fere we going to be able to do what we want with
building the police facility. Is the Pavilion even a remote
possibility without this kind of financing . What can we do
with what we have now and if vie can only do so much , do we
want to do debt financing . It comes down to priorities
first which could be somewhat emotional but after we have
the priorities are firmly established and we look; at how we
can go about purchasing these priorities and we are left
with a fund shortage or without the f i nances then we make
that decision. Ido we want to go into debt financing at this,
point or do we want to scale back . It is very difficult , it
is not cut and dry at all .
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Councilwoman Mackey said we have tried for almost 10 years
to do it without debt financing and we have been spinning
our wheels and hardly keeping our heads above water. She
thinks it is time that we do this . She doesn ' t like looking
at the sheet regarding debt service report where it costs
more -for the debt service than it does for the debt . That
bothers her , but that is the way it is if you buy a house.
Councilman Lilley said he works with Councilman Shiers on
the Finance Sub-Committee and he wants to echo Mr . Shiers
comments about this situation which requires a clear
commitment . The debt is going to become a fixed portion
of our overhead . Therefore the objective that you seek to
satisfy by incurring that debt over time had better be a
value that is beneficial to the community over time. That
warrants a commitment of the municipal overhead . That is
what we are really ,talking about . He is not opposed to
considering a reasonable bond issue or certificate issue.
But he thinks it imposes upon all of us in the process
having accepted that on the one hand as a legitimate thing
to do , on the other hand nail the costs down, make a
crystal clear commitment to what we are going to do with
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I the money and stick with it . Then one way or another with
community consensus it ' s a creative and positive thing to
do , but if we get ourselves into situations where that money
doesn ' t quite get the ,job done we had in mind , and therefore
we don ' t get the job that we committed ourselves to this
obligation done, then we have failed in the process. It is
l his hope that the Council proceeds to look aggressively
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upon the prospects of going ahead with an issue that is
appropriate based on what we can comfortably fund and he
believes we can comfortably fund a sufficient amount to
make an issuance worthwhile. But we need to be very clear
in trying to make sure that what we are going to do is
jgoing to get done in the most cost effective manner and
that council is very careful to peat out accurate information
about that to the community. It may be far more cost
efficient to build the whole police station at once than in
phases. Take a very hard look at getting the most of what
we can get out of a pavilion project , not only an existing
Facility, but maybe something for potential future develop-
ment downstairs as opposed to doing something far less cost
effective with the remodeling . We can ' t afford the luxury
of indulging in that kind of history based upon what he has
heard from the architect in restoring an inefficient
facility at a cost of a Tittle more $100,000 less than
having an efficient facility.
Councilman Dexter commented that we need to keep a watch dog
on the projects to make sure we get the most for our money.
He has seen the City struggle for the past few years
without adequate facilities for public enjoyment and public
service, that it is high-time that we go ahead with this
project and move on. Ten years ago we talked about setting
aside $150,000 per year or so , and in 4 or 5 years we would
be able to build a project . We didn ' t do that and we are
not likely to do that . We have some services to perform for
the community.
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Councilman Shiers said he does not want to be put in the
posi,tion where it pushes him to approve a project; that comes
before him at some future date in order to generate some
additional revenues to make the debt payments. It is hard
enough to turn down some projects or to send them back: to
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be redesigned or maybe change the location so when people
come before the Council and ask for a zone change or
I conditional use permit or precise plan, etc . If we are
facing these debt payments then it can put additional
pressure on Council to approve something when Council might
feel that we shouldn ' t be approving these projects . Council
should take this into account when they make their decisions
concerning this issue.
Mayor Borgeson remarked that Councilmen Lilley and Shiers
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as a finance sub-committee have done an excellent ;job of
researching the matter and would hope that they would put it
into an agenda item for the City Council that they could see
before them those concerns that they have raised , both the
positive and the drawbacks of debt financing so that Council
can further study the issue so that when it comes to
decision making time the Council can make an informed
decision.
Councilwoman Mackey stated they will be looking at other
alternatives besides .what has been talked about here.
Citi`/ Manager Windsor said alternatives in the? sense of you
might use a different financial consultant , bond counsel ,
or what have you. The financing techniques are the same.
You have a choice between long term debt and taking out of
youFunappropriated reserve. Than is really the choice that
council has .
Mayor Borgeson asked if the general obligation bond is a
bond that goes before the public to vote on? Mr . Windsor
said the reason for that is it becomes a lien on the
property that is actually added to your property tax so it
takes a 2/3 vote. A revenue bond requires a majority vote
because you generate a revenue to pay for that bored . So the
people have to approve it . A certificate of participation
does not require a vote because you are taking it out of
existing revenues, revenues you would prioritize in some
other way either through new personnel , other equipment ,
.vihat have you.
Mayor- Borgeson suggested to staff that when this issue comes
before Council if the alternate methods of financing be
looked at such as the general obligation bond , put them down
with their advantages and disadvantages and so on.
Mr . Windsor said he would be happy to do that .
Chief McHale pointed out 1 ) Floss Levin MacIntyr-e & Varner
Assoc . are already contractual employees of the City and
it is his understanding that they may begin working on the
construction drawings with the idea in mind that they have
to discover what the actual costs will be 2) He thought that
Mr . Levin could briefly outline what the steps would be
terms of the sequence of events with regard to the develop-
ment of the drawings.
Mr . Levin responded . Their contract outlines four basic
phases to their services. They have completed the first
one which is the schematic design phase. Second is the
construction document phase which they will be entering
immediately. Thea the bidding or negotiating phase and
13
a
followed by the construction phase. In the construction
document phase is the portion of their work that they
clearly define the construction documents that are
required for bidding and they are the drawings and the
specifications which detail all of the information that
the contractors shall follow when they prepare their bids .
Within this particular same area they complete all of the
engineering that is necessary in the structural , electrical ,
mechanical and this data is depicted on the drawings for the
bidding portion. They will also bring up and update the
cost estimate of construction which will be far- more
accurate than any estimate that they have bought to date.
Now they will have detailed drawings so that real detailed
information can be taken off by their estimator- to update
that particular estimate. When they have these documents
ready they will assist council in presenting them to the
jurisdiction that reviews them such as the building dept .
or planning and the state agency that is involved in the
,,various parts of the projects such as the holding facility
and the Emergency Operating Center . From that point on
they will assist in the administration of the construction
phase handling bulletins and change orders and periodic
site visits during the construction and of course the
final inspection which would be at the end of the project.
Windsor said he was stare it was an oversight but
I� M r- . i r�dso9
engineering was left off that list .
I
Councilwoman Mackey asked about the time. Mr . Levin replied
that he has to admit that they haven ' t been sitting around
in their office waiting for a decision here. They are
looking at least three weeks to get geared up for this.
It will take S to 4 months to finish up the construction
documents and be ready for bidding . A month should be
allowed for bidding . He believes that they can complete
this project under the construction phase in somewhere
between 4 or 5 months. The problem they have with many of
these projects is the time line in ordering certain pieces
of gear- that go into this that might not be on the shelf
such as electrical panels, and lighting fixtures.
Mayor Borgeson asked does it look like the police officers
could have a Christmas party in the new police facility?
Mr . Levin said if he knows the police chief, he knows they
will be in there soon. Mr . Levin will update the 'Staff and
the council with a time schedule as soon as they find out
when they are to proceed .
City Manager Windsor asked that this meeting be adjourned to
Thursday, February 9th to give him the opportunity to refine
some additional budget data and meet with Councilmen Shiers
14
I
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I
and Lilley to put together some recommendations for Council
and to get some material defining the various financing
techniques. This meeting will be at 5 p . m. on FebrUar-y 9th .
MINUTES RECORDED BY:
�'f �7
BOYD C. SGITZ, CITY K
PREPARED BY
r
GIA AM 1 REDEPUTY µI TY CLERK
15
A G E N D A
ATASCADERO CITY COUNCIL
SPECIAL STUDY SESSION
Atascadero Administration Building
Fourth Floor, Club Room
Tuesday, January 31 , 1989
5 : 00 p.m.
1 . DISCUSSION AND REAFFIRMATION OF CAPITAL IMPROVEMENT
PRIORITIES, THEIR FINANCING AND DIRECTION TO PROCEED
2. CONFIRM MEETING FOR MID-YEAR BUDGET UPDATE REVIEW (Thursday,
February 9 , 1989 , 5 : 00 p.m. ?)
GENERAL FUND, FY 89: BUDGETED VS. PROJECTED 31-Jan-89
APPROVED PROJECTED FAVORABLE/
CATEGORY BUDGETED ACTUAL (UNFAVORABLE)
annexa:axasssxsaxasssxsaxssaxassasssxssssaasaassxssxssassassa
FUND BALANCE, 7/1/88 $1,510,327 $1,510,327 $0
REVENUES
Property Tax 1,501,725 1,550,000 4a,275
Sales Tax 1,511.650 1,550,000 3a,350
State Subventions 799,378 792,378 (7,000)
• Franchise Tax 275,000 275,000 0
Bed Tax 105,100 105,100 0
Business Licenses 90,000 95,000 5,000
Property Transfer Tax 30,000 45,000 15,000
Fines & Forfeitures 102,910 87,500 (15,410)
!fisc. State & Local 87,912 93,000 5,088
Comm. Dev Permits/Fees 457,985 457,985 0
Recreation Fees 143,035 200,000 56,965
Use of Land b Money 78,100 150,000 71,900
Other Revenues 109,570 123,800 14,230
------------------------------------
TOTAL REVENUES 5,292,365 5,524,763 232,398
EXPENDITURES*
General Gov't 241,296 241,296 0
Administrative Services 749,895 749,895 0
Community Development 652,938 652,938 0
Police 1,643,405 1,643,405 0
Fire 835,056 835,056 0
Parks b Recreation 642,459 642,459 0
Public Works 698,351 698,351 0
Hon-Dept/Contingency 318,362 150,000 168,362
------------------------------------
SUBTOTAL 5,781,762 5,613,400 168,362
UNANTICIPATED COSTS (SAVINGS AND/OR EXPENDITURES)
One-tine PERS Savings 370,000
Increased Health Ins. 45,000
Misc Post-Budget Adj. ** 280,000
------------
NET SAVINGS 45,000
TOTAL EXPENDITURES 5,781,762 5,56a,400 213,362
FUND BALANCE, 6/30/89 1,020,930 1,466,690 445,760
* In order to be conservative we are assuming that each
Department allocation will be totally expended. It is
reasonable to expect some savings overall (our estimate is
$100,000).
*+ Includes all adjustments to the 1988-89 Budget after
adoption, as well as a contingency for salary changes
resulting from the classification study now in progress.
Also includes the $80,000 recently allocated for the HVAC
system.
**: If debt financing is pursued, per staff's recommendation,
this total would reduce by $175.000, or $270.760.
CITY OF ATASCADERO
20 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
SOURCES AND USES OF FUNDS
01/30/89
SOURCES OF FUNDS:
BOND . ISSUE _ _1,755_000_00
1,755,000.00
USES OF FUNDS:
PROJECT COSTS 1,427,082.50
RESERVE FUND 175,500.00
COSTS OF ISSUANCE & DISCOUNT 87,750.00
FUNDED INTEREST _______64_667_50
1,755,000.00
CITY OF ATASCADERO
20 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
DEBT SERVICE REPORT
Date Principal Coupon Interest Accumulation TOTAL
-------- ---------------- ------- ---------------- ---------------- ----------------
10/01/89 64,667.50 64,667.50
10/01/90 45,000.00 6.200 129,335.00 0.00 174,335.00
10/01/91 45,000.00 6.400 126,545.00 0.00 171,545.00
10/01/92 50,000.00 6.500 123,665.00 0.00 173,665.00
10/01/93 50,000.00 6.600 120,415.00 0.00 170,415.00
10/01/94 55,000.00 6.700 117,115.00 0.00 172,115.00
10/01/95 60,000.00 6.800 113,430.00 0.00 173,430.00
10/01/96 65,000.00 6.900 109,350.00 0.00 174,350.00
10/01/97 65,000.00 7.000 104,865.00 0.00 169,865.00
10/01/98 70,000.00 7.100 100,315.00 0.00 170,315.00
10/01/99 75,000.00 7.200 95,345.00 0.00 170,345.00
10/01/00 80,000.00 7.300 89,945.00 0.00 169,945.00
10/01/01 90,000.00 7.400 84,105.00 0.00 174,105.00
10/01/02 95,000.00 7.500 17,445.00 0.00 172,445.00
10/01/03 100,000.00 7.600 70,320.00 0.00 170,320.00
10/01/04 110,000.00 7.700 62,720.00 0.00 172,720.00
10/01/05 120,000.00 7.750 54,250.00 0.00 174,250.00
10/01/06 130,000.00 7.750 44,950.00 0.00 174,950.00
10/01/07 140,000.00 7.750 34,875.00 0.00 174,875.00
10/01/08 150,000.00 7.750 24,025.00 0.00 174,025.00
10/01/09 160,000.00 7.750 12,400.00 0.00 172,400.00
---------------- ---------------- ---------------- ----------------
1,755,000.00 1,760,082.50 0.00 3,515,082.50
Dated Date: 04/01/89
Delivery Date: 04/01/89
Accrued Interest: 0.00
CITY OF ATASCAD
ERO
20 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
SAVINGS REPORT
i
--------------- P R O P O S E D D E B T S E R V I C E ---------------; Old Cumulative
Date Principal Coupon Interest Accumulation TOTAL Debt Service Savings Savings
-------- ---------------- ------- ---------------- ---------------- ---------------- ---------------- -------------- --------------
04/01/89 * 0 0
10/01/89 64,667.50 64,667.50 0.00 -64,668 -64,668
10/01/90 45,000.00 6.200 129,335.00 0.00 174,335.00 175,000.00 665 -64,003
10/01/91 45,000.00 6.400 126,545.00 0.00 171,545.00 175,000.00 3,455 -60,548
10/01/92 50,000.00 6.500 123,665.00 0.00 173,665.00 175,000.00 1,335 -59,213
10/01/93 50,000.00 6.600 120,415.00 0.00 170,415.00 175,000.00 4,585 -54,628
10/01/94 55,000.00 6.700 117,115.00 0.00 172,115.00 175,000.00 2,885 -51,743
10/01/95 60,000.00 6.800 113,430.00 0.00 173,430.00 175,000.00 1,570 -50,173
10/01/96 65,000.00 6.900 109,350.00 0.00 174,350.00 175,000.00 650 -49,523
10/01/97 65,000.00 7.000 104,865.00 0.00 169,865.00 175,000.00 5,135 -44,388
10/01/98 70,000.00 7.100 100,315.00 0.00 170,315.00 175,000.00 4,685 -39,703
10/01/99 75,000.00 7.200 95,345.00 0.00 170,345.00 175,000.00 4,655 -35,048
10/01/00 80,000.00 7.300 89,945.00 0.00 169,945.00 175,000.00 5,055 -29,993
10/01/01 90,000.00 7.400 84,105.00 0.00 174,105.00 175,000.00 895 -29,098
10/01/02 95,000.00 7.500 77,445.00 0.00 172,445.00 175,000.00 2,555 -26,543
10/01/03 100,000.00 7.600 70,320.00 0.00 170,320.00 175,000.00 4,680 -21,863
10/01/04 110,000.00 7.700 62,720.00 0.00 172,720.00 175,000.00 2,280 -19,583
10/01/05 120,000.00 7.750 54,250.00 0.00 174,250.00 175,000.00 750 -18,833
10/01/06 130,000.00 7.750 44,950.00 0.00 174,950.00 175,000.00 50 -18,783
10/01/07 140,000.00 7.750 34,875.00 0.00 174,875.00 175,000.00 125 -18,658
10/01/08 150,000.00 7.750 24,025.00 0.00 174,025.00 175,000,00 975 -17,683
10/01/09 160,000.00 7.750 12,400.00 0.00 172,400.00 175,000.00 2,600 -15,083
---------------- ---------------- ---------------- ---------------- ---------------- --------------
1,755,000.00 1,760,082.50 0.00 3,515,082.50 3,500,000.00 -15,083
Dated Date: 04/01/89
Delivery Date: 04/01/89
Accrued Interest: 0.00
Calculated Accrued Interest from 04/01/89 to 04/01/89
CITY OF ATASCADERO
15 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
SOURCES AND USES OF FUNDS
01/30/89
SOURCES OF FUNDS:
BOND ISSUE 1,540,000.00
----------------
1,540,000.00
USES OF FUNDS:
PROJECT COSTS 1,254,147.50
RESERVE FUND 154,000.00
COSTS OF ISSUANCE & DISCOUNT 77,000.00
FUNDED INTEREST 54,852.50
----------------
1,540,000.00
CITY OF ATASCADERO
15 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
DEBT SERVICE REPORT
Date Principal Coupon Interest Accumulation TOTAL
-------- ---------------- ------- ---------------- ---------------- ----------------
10/01/89 54,852.50 54,852.50
10/01/90 60,000.00 6.200 109,705.00 0.00 169,705.00
10/01/91 65,000.00 6.400 105,985.00 0.00 170,985.00
10/01/92 70,000.00 6.500 101,825.00 0.00 171,825.00
10/01/93 75,000.00 6.600 97,275.00 0.00 172,275.00
10/01/94 80,000.00 6.700 92,325.00 0.00 172,325.00
10/01/95 85,000.00 6.800 86,965.00 0.00 171,965.00
10/01/96 90,000.00 6.900 81,185.00 0.00 171,185.00
10/01/97 100,000.00 7.000 74,975.00 0.00 174,975.00
10/01/98 105,000.00 7.100 67,975.00 0.00 172,975.00
10/01/99 110,000.00 7.200 60,520.00 0.00 170,520.00
10/01/00 120,000.00 7.300 52,600.00 0.00 172,600.00
10/01/01 130,000.00 7.400 43,840.00 0.00 173,840.00
10/01/02 140,000.00 7.500 34,220.00 0.00 174,220.00
10/01/03 150,000.00 7.600 23,720.00 0.00 173,720.00
10/01/04 160,000.00 7.700 12,320.00 0.00 172,320.00
10/01/05 0.00 7.750 0.00 0.00 0.00
10/01/06 0.00 7.750 0.00 0.00 0.00
10/01/07 0.00 7.750 0.00 0.00 0.00
10/01/08 0.00 7.750 0.00 0.00 0.00
10/01/09 0.00 7.750 0.00 0.00 0.00
1,540,000.00 1,100,287.50 0.00 2,640,287.50
Dated Date: 04/01/89
Delivery Date: 04/01/89
Accrued Interest: 0.00
CITY OF ATASCADERO
15 YEAR DEBT SERVICE
MAXIMUM ANNUAL DEBT SERVICE OF $175,000
SAVINGS REPORT
--------------- P R O P O S E D D E B T S E R V I C E ---------------; Old Cumulative
Date Principal Coupon Interest Accumulation TOTAL Debt Service Savings Savings
-------- ---------------- ------- ---------------- ---------------- ---------------- ---------------- -------------- --------------
04/01/89 * 0 0
10/01/89 54,852.50 54,852.50 0.00 -54,853 -54,853
10/01/90 60,000.00 6.200 109,705.00 0.00 169,705.00 175,000.00 5,295 -49,558
10/01/91 65,000.00 6.400 105,985.00 0.00 170,985.00 175,000.00 4,015 -45,543
10/01/92 70,000.00 6.500 101,825.00 0.00 171,825.00 175,000.00 3,175 -42,368
10/01/93 75,000.00 6.600 97,275.00 0.00 172,275.00 175,000.00 2,725 -39,643
10/01/94 80,000.00 6.700 92,325.00 0.00 172,325.00 175,000.00 2,675 -36,968
10/01/95 85,000.00 6.800 86,965.00 0.00 171,965.00 175,000.00 3,035 -33,933
10/01/96 90,000.00 6.900 81,185.00 0.00 171,185.00 175,000.00 3,815 -30,118
10/01/97 100,000.00 7.000 74,975.00 0.00 174,975.00 175,000.00 25 -30,093
10/01/98 105,000.00 7.100 67,975.00 0.00 172,975.00 175,000.00 2,025 -28,068
10/01/99 110,000.00 7.200 60,520.00 0.00 170,520.00 175,000.00 4,480 -23,588
10/01/00 120,000.00 7.300 52,600.00 0.00 172,600.00 175,000.00 2,400 21,188
10/01/01 130,000.00 7.400 43,840.00 0.00 173,840.00 175,000.00 1,160 20,028
10/01/02 140,000.00 7.500 34,220.00 0.00 174,220.00 175,000.00 780 -19,248
10/01/03 150,000.00 7.600 23,720.00 0.00 173,720.00 175,000.00 1,280 -17,968
10/01/04 160,000.00 7.700 12,320.00 0.00 172,320.00 175,000.00 2,680 -15,288
10/01/05 0.00 7.750 . 0.00 0.00 0.00 175,000.00 175,000 159,713
10/01/06 0.00 7.750 0.00 0.00 0.00 175,000.00 175,000 334,713
10/01/07 0.00 7.750 0.00 0.00 0.00 175,000.00 175,000 509,713
10/01/08 0.00 7.750 0.00 0.00 0.00 175,000.00 175,000 684,713
10/01/09 0.00 7.750 0.00 0.00 0.00 175,000.00 175,000 859,713
1,540,000.00 1,100,287.50 0.00 2,640,287.50 3,500,000.00 859,713
Dated Date: 04/01/89
Delivery Date: 04/01/89
Accrued Interest: 0.00
* Calculated Accrued Interest from 04/01/89 to 04/01/89