PURPOSE:

The purpose of this report is to request the approval to appropriate available bond proceeds from the remarketing of the $25 million Golden State Redevelopment Project Subordinated Tax Allocation Bonds, Issue of 1993 along with the Burbank Public Financing Authority (BPFA) Revenue Bonds, 2003 Series A (Golden State Redevelopment Project).

BACKGROUND:

In January 2003 the Burbank Public Financing Authority issued $87,265,000 in Revenue Bonds, 2003 Series A (Golden State Redevelopment Project).  The primary purpose of the bonds was to purchase in lieu of redemption most of Golden State Redevelopment Project Tax Allocation bonds, 1993 Series A and to provide money for projects within the Golden State Project Area.  As a product of the purchase in lieu of redemption financing, it produced $5,095,000 of new money which can be used for City capital projects.

In September 2003 the Golden State Redevelopment Project remarketed its $25 million subordinated debt.  The remarketing produced $22,645,000 which can be used for City capital projects.

ANALYSIS:

Staff has identified several capital projects (i.e. DCSB, payoff of the City Hall Annex loan, and a new Soccer field) which would be funded by the available bond proceeds.  In addition, the modification of the Public Works equipment repair shop to accommodate CNG vehicle repairs is in need of funding.  Other projects such as the Robert Ovrom Park, Chandler Bikeway, the future plaza to be located at the northeast corner of Olive Avenue and Third Street next to the Development and Community Services Building (DCSB) and Library projects may need funding.  The following is a recap of available funding and the recommended appropriations:

BPFA Revenue Bonds, 2003 Series A                                                    $5,095,000

Golden State Subordinated Tax Allocation Bonds, Issue of 1993        22,645,000

      Amount available for Capital Projects                                        $27,740,000

DCSB Schematic Design Budget                                                          $25,500,000

      Amount previously appropriated                                                           3,446,145

      Under grounding to be performed by BWP                                             360,000

      To be appropriated from UUT and In Lieu Set-aside                          1,500,000

      To be appropriated from Art in Public Places Funds                             150,000

            Amount to be funded from available resources                           20,043,855

Soccer Field Construction                                                                           1,500,000

City Hall Annex lease payoff                                                                        2,057,853

Equipment Repair Shop modifications                                                          650,000

Projects Contingency Fund                                                                          3,488,292

      Total Recommended Appropriations                                         $27,740,000

DCSB Project

The anticipated total budget for the DSCB project has not changed since the establishment of the schematic design budget at the December 10, 2002 Council meeting.  At that meeting the budget assumed funding of $1,500,000 for the UUT and in lieu set-aside funds and $150,000 from Arts in Public Places Funds.  The budget resolutions formally appropriate these funds along with the $20,043,855 balance of the project from available capital projects funding.

Soccer Field Construction

The City is currently pursuing a location for the development of a new soccer field.  Staff has estimated the development of the soccer field and related facilities would be $1.5 million.

City Hall Annex Lease Payoff

The City Hall Annex building was financed with a lease agreement.  Annual lease payments are paid by the Municipal Building Maintenance Internal Service Fund and amount to $390,862 per year through the 2008-09 fiscal year.  A portion of the City Hall Annex property will be used for the planned Central Library Project.  As the land for the library project must be deeded to the State, the City would need to clear the lease encumbrance from the property.  The annual savings of the Municipal Building Maintenance Internal Service Fund will be used to provide additional funding to seismically rehabilitate existing municipal buildings.

Equipment Repair Shop Modifications

The City is transitioning its fleet toward CNG vehicles.  The existing Public Works equipment maintenance facility needs to be modified to accommodate this activity and comply with current codes.  The project has been estimated to cost $950,000 and includes electrical, ventilation and other modifications necessary to legally permit natural gas, hydrogen and future gaseous fueled vehicles to be worked on and stored inside the repair shop.

Staff originally budgeted $300,000 for this project.  However, this was based on doing only the modifications absolutely necessary to comply with governing regulations.  Upon review  of our preliminary designs with the Fire Department, it was felt by all that it would be more prudent to design a system capable of not only meeting the minimum requirements, but to design a system that would provide a higher level of safety, reliability and usability into the future. 

The original project design relied on "City" electrical power to run exhaust fans in the event of a gas build-up in the shop.  Without back-up power and in the event of a power outage, a gas build-up could occur, creating a hazardous and explosive condition.  The proposed system will use a stand-by generator to provide electrical power at all times to the exhaust fans.

The Public Works Yard is the Department�s Operations Center (DOC), a key facility in the event of emergencies involving activation of the EOC.  As such, all buildings should be provided with emergency stand-by power but are not.  The addition of the project standby generator will permit full operation of the facility in the event of a power outage.

The Vehicle Equipment Replacement Internal Service Fund has appropriated $300,000 towards this project.  Staff is proposing to appropriate the balance of the project ($650,000) from the available capital projects funding.

Projects Contingency Fund

The City has several large active projects either in progress or in the planning stages.  Staff believes that it is prudent to set-aside funding to cover unanticipated issues as well as unfunded portions of planned projects.  These projects include the DCSB, Robert Ovrom Park, a new soccer Field, Chandler Bikeway, Central Library, and the plaza located next to the DCSB on Third St. and Olive Ave, which has not been funded.

FISCAL IMPACT

The development of the above projects, with the exception of the payoff of the City Hall Annex lease, will lead to additional recurring expenditures.  The additional recurring expenditures have not been identified as of the date of this report; however, they will need to be addressed during future budget years.  The payoff of the City Hall Annex lease saves the Municipal Building Maintenance Internal Service Fund $390,862 and will be used to provide additional funding to seismically rehabilitate existing municipal buildings.

RECOMMENDATION:

It is recommended that the City Council approve the proposed resolution requesting adjustments to the Fiscal Year 2003-04 Budget.

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