SR-12-16-2014-3BX,. *- •. 2
To: Mayor and City Council
From: Karen Ginsberg, Director of Community and Cultural Services
Subject: Annual Report on the City's Child Care Linkage Program
Recommended Action
Staff recommends that the City Council receive the Child Care Linkage Program Annual
Report for Fiscal Year 2013 -14.
Executive Summary
In compliance with Santa Monica Municipal Code 9.72.090, this report transmits
information regarding the revenue received pursuant to the City's Child Care Linkage
Program for the reporting period of FY 2012 -13. The total Child Care Linkage Fee
revenues for FY 2013 -14 are $281,650.22. Staff will continue to monitor development
projects and revenue collection of child care linkage fees.
Background
On December , 2006 Council adopted ordinance Chapter 9.72 of the Santa Monica
Municipal Code (SMMC) to establish a child care linkage fee program. This fee is
intended to address the increased demand for childcare triggered by the development
of commercial projects adding floor area of at least 7,500 square feet or multi - family
residential projects.
Developers can satisfy the ordinance requirements by either paying a fee or by
agreeing to participate in the construction or establishment of one or more child care
facilities. Child care linkage fees shall be paid by the final inspection date and prior to
the issuance of the Certificate of Occupancy. Fees are computed annually on July 1s
increasing by a percentage equal to the Construction Cost Index as published by
Engineering News Record.
For FY 2013 -14, the fees were the following:
Project
Fee
Residential
$133.62/dwelling unit
Office
$6.34 /square foot
Retail
$4.54 /square foot
Hotel
$3.18 /square foot
Following adoption of the ordinance, the City established a Child Care Linkage Fee
Reserve Account for the collection of fees to be used to create new child care spaces.
The ordinance requires an annual report to City Council within 180 days after the last
day of each fiscal year. Since adoption of the ordinance in 2006, Council has received
an annual update on Child Care Linkage Fee Program revenues with the first actual
receipts realized in FY 2011 -12 as reported to Council on Jnuary 2. 2013.
Discussion
In FY 2013 -14, $3,013.36 in revenues were collected (fees totaling $1,580.26 and
interest totaling $1,433.10) and deposited into Child Care Special Revenue Account
4.365203. The revenues collected in FY 2013 -14 were added to the prior year Special
Revenue Account 4.365203 balance of $281,650.22. The ending balance as of June 30,
2014 for Special Revenue Account 4.365203 totaled $284,663.58. Staff will continue to
closely monitor proposed development projects and revenue collection.
Section 9.72.070 of the ordinance specifies that funds collected in the Child Care
Linkage Fee Reserve Account shall be restricted to costs related to property acquisition,
development and construction of child care facilities within the City of Santa Monica in
addition to any administrative costs incurred by the City to manage the reserve account.
Eligible expenditures shall not include ongoing operating expenses and general
maintenance of child care facilities.
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Staff is structuring administrative guidelines and following the municipal code to meet
Child Care Linkage Fee Ordinance requirements. To that end, the Early Childhood
Education Center (ECEC), a partnership project between the City and Santa Monica
College to be built in the Santa Monica Civic Center, is identified as a priority project for
disbursement of funds. The ECEC project will go before Council in 2015 and, at that
time, Council will be asked to approve the lease with SMC and to possibly appropriate
Child Care Linkage Fee revenues as a contingency. While CIP funds totaling
$5,563,000 were budgeted in FY2011 -12 for this project, construction costs have
increased significantly which may necessitate additional funding as the ECEC is
•' E111176 -.
Financial Impacts & Budget Actions
There is no immediate financial impact or budget action necessary as a result of the
approval of revenue report of the Child Care Linkage Program for the reporting period of
FY 2013 -14.
Prepared by: Julie Taren, Senior Administrative Analyst
Approved:
Karen Ginsberg i
Director
Community and Cultural
W
Forwarded to Council:
Roc�Gould
City Manager