SR-301-001-06
Council Meeting: July 27, 2004 Santa Monica, CA
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Offer Contingent Support of Partnership
Opportunities with Santa Monica College and to Return in Two Months
with a Formal Agreement to Effect the Partnership
Introduction
This report provides an update on partnership opportunities presented by the proposed
$175M Santa Monica College bond measure. Given the concurrence of interest in
certain Proposition 39 qualifying projects by the two institutions, potential project timing
and financing capacity considerations of each organization and the inadvisability of
structuring complex partnership agreements on a short timeline, the report recommends
that Council consider and identify those projects that are of interest and offer contingent
support of the partnership concept. Intense effort over the next two months would be
needed to create and execute a formal agreement that would more fully define partner
roles and provide for land use controls that resolve Council and community concerns,
forming the legal basis for joint endeavors. Absent achievement of such an agreement,
support should be withdrawn.
Background
On June 22, the City Council heard a presentation from Santa Monica College
regarding a $175M facilities bond they are considering placing on the November 2004
1
ballot, including potential Proposition 39 qualifying partnership projects benefiting the
broader community. City staff suggested that the Council consider the opportunities in
the context of a broader look at the current roster of capital project needs and Council
directed staff to return with information on legal mechanisms to effect partnerships as
well. In the interim the College has presented their case for the measure at community
meetings and refined the proposed project list based in part on input from those groups
and from potential partners. A joint powers agreement with the City of Malibu, one such
partner, is reportedly being drafted. City staff has engaged counsel with bond expertise
to explore implications of partnership and to assist, if appropriate in shaping an
agreement. Staff also reviewed the funding status of the broad range of capital needs.
Discussion
nd
The College will determine on August 2 whether to place the measure, which
apparently polled strongly, on the ballot. If successful, they contemplate the measure
funding three phases of projects via five series of bonds issued over a period of nine or
more years. It is not clear how the three project phases will overlay the schedule of the
five series. Potential City partnership opportunities identified by the College, shown with
associated allocations and phasing (both tentative at this time), include the following:
?
Physical education and athletic field acquisition and improvements –
$37,000,000 - Phases I & II
?
Energy efficiency improvements - $4,000,000 – Phases I, II, &III
?
Early childhood development lab and replacement child care center - $7,000,000
– Phase II
?
Marine biology improvements - $2,000,000 – Phase II
?
Botany improvements - $10,000,000 – Phase III
2
Project Issues
The potential partnership projects proposed by the College and one additional
opportunity Council may wish to explore are discussed in greater detail below:
A joint use agreement between the College and City is already in place for the Santa
Monica Swim Center, constructed by the City on College property with shared use by
the two institutions. The agreement could be appropriately modified with little effort if
the nature and scheduling of energy efficiency improvements to the facility are agreed
to by the City and contemplated by the College for Phase I. The objective would be to
significantly reduce ongoing operating costs which are shared by the two institutions.
The project might present other opportunities to work jointly to advance sustainability
objectives.
Field acquisition and improvement projects are scheduled for Phases I and II of the
College plan and are as yet undefined as to location and nature. Community demand
for sports fields is high and the condition of existing fields suffers from intensive use.
This is the only proposed partnership opportunity that might be carried out on newly
acquired property not owned or operated by the City. Ownership, development and
operating aspects of a partnership would depend on the circumstances of specific sites
identified and pursued jointly. Development of a master agreement to be supplemented
with project-specific sub-agreements may be the appropriate way to effect partnership
for field acquisition and improvement. In response to concerns expressed in community
meetings and by Council Members, the College staff has recommended that, should
3
partnership occur, the College not unilaterally override City land use authority in its
realization. The Council may wish to consider what this means and whether it
constitutes adequate assurance that neighborhood quality of life will be protected. It is
important to note that sports field development or improvement is also an interest of the
Santa Monica-Malibu Unified School District, which will be evaluating the need for and
viability of a facilities bond measure over the next year or more.
Either the School District or the City might be a potential partner with the College in a
child development lab and childcare center. Other School District facility considerations
may preclude their participation in such a partnership on the schedule contemplated by
the College. Proposed Phase II timing could facilitate development of the childcare
center contemplated in the Civic Center Specific Plan given currently contemplated
timing for that project. The City’s role in the partnership beyond providing land would
have to be defined.
A marine biology project, at a relatively low project cost in Phase II, would involve
partnership if developed on City owned or operated property, as would be the case if it
involved the Ocean Discovery Center at the Pier. Further concept development would
be essential to define roles and responsibilities of partners.
Finally, the College may have an interest in development of an arboretum as a biology
education resource in the third project phase. An arboretum was one concept
discussed for the “Palisades Garden Walk” area during the Civic Center planning
4
process. If ultimately undertaken, the College might provide or supplement
development funds while the City provides the site and is responsible for ongoing
operations and maintenance. This project timing falls outside the current five year
forecast for the City.
The East/West Corridor Parking Task Force will recommend to Council in September
the exploration of creative partnerships to meet parking needs. Council may wish to ask
that the College reconsider including in the project list underground parking at the
Madison Campus if School District approval can be obtained and it supports an
educational purpose.
Timing Issues
The College timetable for placement of the measure on the ballot compresses the
opportunity for substantive discussion with partners and the community.
Staff remains concerned that the timing of this measure may affect the increase in the
Transient Occupancy Tax that Council will consider placing before the voters in
November. Local voters will be faced with State and regional measures that affect their
pocket books directly and, if the College goes forward, a local measure which also
requires taxpayers to give. The TOT increase that is essential to meeting the City’s
ongoing financial obligations would be paid by visitors to the community rather than
local taxpayers. The full support of the education community for the TOT increase
would help to mitigate this concern.
5
Potential partnership opportunities between the City and the Santa Monica-Malibu
Unified School District emerged from the Civic Center planning process, relating to
parking and field space. Taxpayer “exhaustion” is an obvious concern as the District
analyzes its facility needs and contemplates a resulting appeal to voters in coming
years. A successful partnership model created now between the City and the College
might help the community embrace a subsequent measure offering community benefits
through similar partnership between the City and District, but that is not certain.
Development of an agreement that protects the interests of the College and the City and
facilitates realization of mutual goals that cannot be fully defined at this juncture is
problematic. Time pressure is not constructive in forging a new and much closer
relationship between parties that have not always shared concerns for community
involvement and processes for project review. An intensive period of work will be
required to develop such an agreement and individual project agreements will likely be
necessary as each partnership opportunity proceeds.
Budget/Financial Impact
There is no immediate budget/financial impact of the recommended action. The
potential partnership opportunities proposed by the College could result in lower project
development costs and shared operating costs through pooling of resources as
opposed to undertaking the projects individually. Savings, of course, are realized only if
the projects are indeed high priorities of each agency and would in fact have been
6
undertaken individually absent partnership. Entering a partnership to develop a project
that is not a priority diverts resources that could have been dedicated to other high
priority projects.
Recommendation
Staff recommends that Council consider and identify potential partnership projects in the
context of other capital needs, provide direction as to acceptable land use protections
that might be sought of partners, offer contingent support of the measure and direct staff
to attempt to develop an agreement that would form the basis for partnership and allow
for full support by September 30, 2004.
Prepared by: Susan E. McCarthy, City Manager
7