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SR 02-12-2019 3G City Council Report City Council Meeting: February 12, 2019 Agenda Item: 3.G 1 of 3 To: Mayor and City Council From: Susan Cline, Director, Public Works, Office of Sustainability & the Environment Subject: Adoption of a Resolution to Apply a 2% Fee Escalation to Costs Associated with Water Neutrality Fees Recommended Action Staff recommends that the City Council adopt the attached resolution to apply a 2% escalation to staff rates, administrative fees and plumbing fixture installation costs associated with agreement #10496. The fee escalation will go into effect February 18, 2019. Summary In its efforts to achieve water self-sufficiency, the City of Santa Monica requires all new developments and major remodels to not use any net new water. Property owners may achieve their water usage limit by funding water efficiency measures in other properties to offset any anticipated use of water above their allowance. The City’s Water Neutrality Direct Install Program identifies candidate properties and uses DNV GL Energy Services, Inc. to install water efficiency fittings. The current agreement with DNV GL provides for a 2% escalation to all DNV GL staff rates, administrative fees and plumbing fixture installation costs for work happening after January 1, 2019. Staff recommends that the City Council adopt the attached resolution to execute a 2% fe e escalation to cover rising cost of installation services. The fee escalation will not change the contract budget amount of $2,000,000. Discussion As stated in the agreement with DNV GL, the rates and fees approved by Council on June 27, 2017 are guaranteed through December 31, 2018 (Attachment A). Although Council awarded the RFP to implement the Water Neutrality Ordinance on July 11, 2017, the contract was not executed until March 26, 2018, as staff had to negotiate final 2 of 3 agreement terms and conditions. Shortly after executing the contract, DNV GL lost their sub-contractor, and therefore additional time was needed to bring a new subcontractor onboard that meets the requirements of the agreement. The agreement provides a 2% fee escalation apply to all DNV GL staff rates, administrative fees and plumbing installation costs for work performed after December 31, 2018. 2% fee escalation was negotiated in the contract as a cost of living adjustment, which is an annual increase. Staff recommends adopting the attached resolution to honor the contract terms and update Water Neutrality Fees within Exhibit L in the Master Fee Schedule (Attachment D). If approved by Council, the 2% fee escalation shall become effective February 18, 2019. Staff intends to modify the contract language to make the fee increase in July instead of annually in December to align with the City’s regular fee schedule. Staff will incorporate this fee escalation during the FY 2019-21 biennial budget and these fees will not be updated again until June 2020. Past Council Actions 07/11/17 (Attachment B) Award Agreement with Vendor for Water Neutrality Program 06/27/17 (Attachment C) Adoption of Fee Schedule Financial Impacts and Budget Actions Water Neutrality is a cost neutral program for the City. This fee increase, and any future increases, would be passed through to new development applicants. The 2% increase in Water Neutrality Fees ensures the program remains cost neutral. Failure to increase the fee would mean the City would have to co ver the 2% difference. The fee escalation will not change the contract budget amount. Agreement #10496 is for an amount not to exceed $2,000,000 over five years. Staff will return to Council if specific budget actions are required in the future. 3 of 3 Prepared By: Karina Sandique, Sustainability Analyst Approved Forwarded to Council Attachments: A. Agreement 10496 - Water Neutrality Vendor Budget B. July 11, 2017 Staff Report C. June 27, 2017 Staff Report D. Exhibit L E. Fee Resolution F. Written Comments City Council Report City Council Meeting: July 11, 2017 Agenda Item: 3.K 1 of 5 To: Mayor and City Council From: Susan Cline, Director, Public Works, Office of Sustainability & the Environment Subject: Agreement with Vendor for Water Neutrality Program Recommended Action Staff recommends that the City Council 1. Award RFP# 98A to DNV GL Energy Services USA, Inc., a California-based company, to implement the water neutrality ordinance; 2. Authorize the City Manager to negotiate and execute an agreement with DNV GL Energy Services USA, Inc. in an amount not to exceed $2,000,000 over a five- year period with future year funding contingent on Council budget approval. Executive Summary Given the water supply challenges facing Southern California, the City of Santa Monica has one of the region’s most ambitious urban water management efforts. The City has adopted a goal of achieving water self -sufficiency by 2020, ending our long-standing reliance on imported water for a portion of our supply. To reach this target, new development will need to be far more water efficient than existing buildings and older buildings and landscapes will need to be retrofitted to sustainably reduce water usage demand. On May 23, 2017, Council adopted an ordinance amending Municipal Code 7.16.050 that requires new development to offset water use on-site, or alternatively, pay the City an in-lieu fee to fund retrofitting of plumbing fixtures off -site or the developer retrofit water-saving fixtures off-site at their own expense. Staff is recommending DNV GL Energy Services USA, Inc. to implement the water neutrality ordinance by providing the following services: develop and maintain the online water demand calculator, pre - screen retrofit sites, purchase and install water-saving devices, track and report on new 2 of 5 development compliance and retrofits, and plan check and inspection services as needed. Background On May 9, 2017, per Attachment A, to move closer toward the City’s goal of becoming water self-sufficient by 2020, staff recommended that the City Council introduce for first reading a water neutrality ordinance that required new developments and new or enlarged pools, spas, water features, and ponds to stay within the same water use as the existing property through the installation of water-efficient fixtures and systems on- site. If compliance cannot be met, the applicant must offset the projected additional water use elsewhere in the city. In addition, the City will provide a fee-based turn-key retrofit program and/or the applicant can install retrofits at self-selected sites at their own cost. On May 23, 2017, Council adopted the water neutrality ordinance with the intent to keep the city’s total water demand from increasing as a result of new development (Attachment B). The first reading included a nine-month implementation schedule and the water demand mitigation ordinance to end February 28, 2018 and the water neutrality ordinance to start on March 1, 2018. The second reading was changed to end water demand mitigation on June 30, 2017 and start water neutrality on July 1, 2017. Discussion The Water Neutrality ordinance requires new developments to cap water use to the existing parcel’s use through the installation of water-efficient fixtures and systems onsite and/or pay for water savings offsets somewhere else in the city if compliance cannot be met. The implementation would be provided by City staff and a consultant. City staff will support the implementation of this ordinance by providing contract management, initial plan review, and tracking offset payments. The majority of this staff’s time will be implementing the water use allowance citations as part of the Stage 2 Water Supply Shortage, which includes systematically evaluating customer exceedances each week, reviewing the customer’s past conservation efforts, issuing the citations, performing and tracking water school participation, tracking payments, 3 of 5 issuing waivers and/or refunds, and preparing cases for appeals. In order to respond to on-going water shortage conditions and issue citations, it is necessary to provide additional resources to fully implement the water neutrality ordinance. If the water supply shortage was rescinded, City staff would take over the administrative tasks from the vendor and continue to manage the vendor’s water-saving fixture direct installations. To effectively implement the water neutrality ordinance, the selected consultant would be responsible for administration of the Program and installations of water-saving fixtures. Administrative tasks include, but are not limited to development of the plan check process and tools including a new online water demand calculator, identifying retrofit sites, pre-screening sites for retrofit eligibility, data management and program reporting including prevailing wage. The consultant would also provide plan check and inspection services if needed. Installation tasks include, but are not limited to the removal and recycling of less water- efficient toilets, showerheads, faucet aerators, and urinals as well as the purchase and installation of more water-efficient fixtures. Fees charged to the new development applicant are based on the cost proposal provided by the selected vendor. These fees were included in the fee schedule adopted by Council on June 27, 2017. Consultant Selection On December 16, 2016, the City issued a Request for Proposa ls (RFP) for the implementation of the water neutrality ordinance. The RFP was posted on the City’s on- line bidding site, and notices were advertised in the Santa Monica Daily Press in accordance with City Charter and Municipal Code provisions. A total of 1,405 vendors were notified and 52 vendors downloaded the RFP. Two firms responded, however, both bids were incomplete and rejected. 4 of 5 The RFP was re-issued on January 24, 2017 and posted on the City’s on-line bidding site, and notices were advertised in the Santa Monica Daily Press in accordance with City Charter and Municipal Code provisions. A total of 1,406 vendors were notified and 40 vendors downloaded the RFP. Two firms responded: DNV GL Energy Services USA, Inc. Urban Fabric, Inc. Responses to the RFP were reviewed by a selection panel of staff from the Public Works Department. Evaluation was based on the following selection criteria: experience, references, work plans/timelines, project team, cost, and presentation. Based on this criteria and criteria in SMMC 2.24.073, staff recommends DNV GL Energy Services USA, Inc. as the best qualified firm to provide program administration, because they provided the most cost- effective proposal and have provided excellent program administration for water conservation rebates, the retrofit upon sale ordinance, and water waste enforcement for the City from 2003 to 2010. DNV GL Energy Services USA, Inc. is currently under contract with the City of Santa Monica to implement the Climate Action Plan and staff is very satisfied with the firm’s services. Financial Impacts and Budget Actions The agreement to be awarded to DNV GL Energy Services USA, Inc. is for an amount not to exceed $2,000,000 over five years. Funds of $2,000,000 are available in the FY 2017-18 budget in the Public Works Department. The agreement will be charged to account 014262.555060. Future year funding is contingent on Council budget approval. Of the $2,000,000 to be expended, a total of $1,930,000 will be recouped. 5 of 5 Prepared By: Kimberly O'Cain, Senior Sustainability Analyst Approved Forwarded to Council Attachments: A. May 9, 2017 Staff Report - Water Neutrality Ordinance First Reading B. May 23, 2017 Staff Report - Water Neutrality Ordinance Second Reading and Adoption C. 2017 OAKS INITIATIVE FORM Signed City Council Housing Authority Parking Authority Report City Council Meeting: June 27, 2017 Agenda Item: 9.A 1 of 14 To: Housing Authority, Parking Authority, Mayor and City Council From: Gigi Decavalles-Hughes, Director, Finance Department, Budget Donna Peter, Director, Human Resources Department, Susan Cline, Director, Public Works Department Subject: Adoption of the First Year and Approval of the Second Year of the Fiscal Year (FY) 2017-19 Biennial Budget, Adoption of the Second Year of the FY 2016 - 18 Biennial Capital Improvement Program Budget Recommended Action Staff recommends that the City Council, Housing Authority and Parking Authority: 1. Adopt a Resolution of the City Council of the City of Santa Monica adopting the first year and approving the second year of the FY 2017 -19 Biennial Budget and adopting the second year of the FY 2016-18 Biennial Capital Improvement Program Budget at Attachment A, as amended by Attachment D; 2. Adopt a Resolution of the Housing Authority of the City of Santa Monica adopting the first year and approving the second year of the FY 2017 -19 Biennial Budget and adopting the second year of the FY 2016-18 Biennial Capital Improvement Program Budget at Attachment B, as amended by Attachment D; and 3. Adopt a Resolution of the Parking Authority of the City of Santa Monica adopting the first year and approving the second year of the FY 2017 -19 Biennial Budget and adopting the second year of the FY 2016-18 Biennial Capital Improvement Program Budget at Attachment C, as amended by Attachment D . Staff also recommends that the City Council: 1. Adopt a Resolution of the City of Santa Monica revising the City’s Master Fee Schedule to establish and revise certain permit and user fees and charges in the Planning and Community Development, Public Works, Fire, Community and Cultural Services, Finance, and Records and Election Services Departments and for the Santa Monica Public Library and City Manager’s Office (Attachment E); 2. Adopt a Resolution of the City of Santa Monica setting forth the administrative citation schedule of fines for certain violations of the Santa Monica Municipal Code, setting civil penalties for parking violations and for the late payment of penalties, setting fines for Police and Fire Department responses to excessive false alarms, and setting fines for the Santa Monica Public Library (Attachment F); 3. Adopt a Resolution of the City of Santa Monica establishing parking rates and permit fees for all City facilities and resources (Attachment G); 2 of 14 4. Adopt a Resolution of the City of Santa Monica establishing new classifications and adopting salary rates for various listed positions (Attachment H) and approve the position and classification changes (Attachment I); 5. Adopt a Resolution of the City of Santa Monica establishing the Gann appropriations limit for FY 2017-18 (Attachment J); 6. Approve the Proposed FY 2017-18 Human Services Grants Program (HSGP), incorporating the proposed funding levels (Attachment K); 7. Approve the Proposed FY 2017-18 Organizational Support Program (OSP) Grants for Arts and Culture Nonprofits, incorporating the proposed funding levels (Attachment L); and 8. Accept Continuum of Care Program Grant funds from the U.S. Department of Housing and Urban Development (HUD) in the amounts of $478,782 and $2,786,792 to serve the homeless and disabled populations with housing subsidies. Executive Summary This report presents information and requests actions necessary to adopt the first year of the FY 2017-19 biennial budget following the public hearings on the budget last month, including the second year of the FY 2016-18 Biennial Capital Improvement Program (CIP) Budget, for the City of Santa Monica, the Santa Monica Housing Authority and Santa Monica Parking Authority. It also requests that Council approve the operating budget plan for the second year of the Biennial Budget. Since the City Charter requires Council to adopt a budget annually, staff will submit the FY 2018-19 budget plan to Council for formal adoption, with any necessary revisions, in June 2018. The City released its Proposed Budget for FY 2017-19 on May 16, 2017 and Council heard from individual departments and gave direction on specific priority areas at the Budget Study Sessions on May 23 and 24, 2017, resulting in the adjustments to the Proposed Budget recommended in this report. The Proposed Budget as revised is $774.9 million in FY 2017-18 and $802.8 million in FY 2018-19. This report also includes actions necessary to revise certain fees, fines and parking rates and responds to Council queries and requests from the public hearings . In this report, staff recommends continued funding to most Human Service Grants Program and Organizational Support Program grantee organizations at the FY 2016-17 funding levels, plus a 2.2% cost of living adjustment, and the acceptance of federal Continuum of Care Program renewal grant funds. Background On January 24, 2017 (Attachment M), Council reviewed and commented on the FY 2017-22 Five-Year Financial Forecast and directed staff to develop a fiscally sustainable budget. 3 of 14 During the two budget study sessions, held on May 23 and 24 (Attachment N), staff presented the May 2017 Financial Status Update for the General Fund for Fiscal Years 2017-22, as well as the FY 2017-19 Proposed Biennial Budget and Capital Improvement Program Budget for FY 2017-18. Discussion The proposed two-year budget is balanced, with resources dedicated to maintaining the City’s core services and allocating new and repurposed funding to programs that reflect Council priorities. The Proposed Biennial Budget for the City of Santa Monica has been revised from the document presented to the public on May 16, 2017 to reflect final changes based on Council feedback and new information received. The Proposed Budget as revised is $774.9 million in FY 2017-18 and $802.8 million in FY 2018-19. The May 23 and 24 Budget Study Sessions provided an opportunity for Councilmembers to ensure the Proposed Budget meets community needs. During the study sessions, Councilmembers directed staff to consider incorporating various changes to the proposed operating budget, and to provide additional information on certain items in time for the budget adoption public hearing on June 27, 2017. Requested information is included below and any relevant changes are included in the list of proposed final changes shown in Attachment D. Vision Zero Council directed staff to assign a staff member dedicated to Vision Zero, an initiative seeking to eliminate traffic fatalities and serious injuries. Staff proposes the creation of a two-year action plan that will be presented to Council for review by October 2017. Until then, staff has identified an interim staffing plan for a Vision Zero Coordinator. Staff in the Mobility Division of the Planning and Community Development Department will take on temporary assignments to allow a single coordinator to give interdepartmental leadership to all aspects of pursuing Vision Zero. Rather than spending new dollars on additional staffing at this time, s taff recommends that one-time funds of $500,000 be appropriated to the FY 2017-18 Proposed Budget 4 of 14 for Vision Zero action plan projects that will occur over the next two years. Projects would include the installation of targeted physical improvements that would be complemented with other education, encouragement and enforcement efforts currently underway. Staff has developed a proposal to expend the funds based on a review of high-collision intersections, the Pedestrian Action Plan demand and crash analysis, community destinations and Council comments, as follows:  Improve the Pico/Stewart crossing improvements with one curb extension and lead pedestrian interval to increase pedestrian visibility and reduce exposure ($100,000)  Improve either the Santa Monica Boulevard/6th Street or Broadway/5th Street intersections with two curb extensions and lead pedestrian interval to increase visibility and reduce pedestrian exposure ($180,000)  Install Rapid Rectangular Flashing Beacons to increase vehicle yielding at two Wilshire intersections and two school locations ($120,000)  Pilot bicycle and pedestrian protections on Arizona Avenue at McKinley Elementary or similar location ($80,000)  Install lead pedestrian intervals at 25 signalized intersections throughout Santa Monica (identified based on pedestrian volumes, crash history and adjacent community destinations) (Staff time cost)  Continue enforcement and education operations (Staff time cost) Additional funds for capital investment in making all of Santa Monica streets safer for all users from the recently passed County Measure M and the additional local return of gas tax funds approved by Governor Brown and the State Legislature. Using Data to Impact Service Delivery Council requested assurances that staff would begin applying the City’s new Framework and performance management model to impact service delivery and budget decision - making. At its January 28, 2017 retreat (Attachment O ), Council received staff’s report on a new organizational framework based on the dimensions of wellbeing and the Sustainable City Plan that would assist with creating a performance management system. In response to Council’s direction, staff worked to better integrate sustainability and governance into the Wellbeing Framework in preparation for the FY 2017-19 budget. This refined Framework, presented in the Proposed Budget, is built on the longstanding commitments and goals of the Sustainable City Plan and the baseline findings of the first Wellbeing Index from 2015. Staff used the Framework to 5 of 14 organize budget proposals, prioritize budget requests and ultimately frame the FY 2017-19 budget around its six outcome areas (community, place and planet, learning, health, economic opportunity and governance). This fall, the next version of the Wellbeing Index will be released. Over the coming year, findings from the next Index and goals from the Sustainable City Plan will be integrated into the Framework. This will establish meaningful goals and metrics to track the impact of City work efforts, including Council Strategic Goals. Staff will engage a range of community partners to address issues of most concern to the community. This summer there will be staff training on the next steps to launch the City’s new performance management process, SaMoStat, beginning with its application to the Council’s Strategic Goals. The first SaMoStat meeting will be held in July, focusing on our regional efforts to reduce homelessness. Reed Park Programming Council requested information on options to increase staff presence and activities at the newly-renovated Reed Park in order to maintain a safe, accessible and attractive open space. Staff spoke with Downtown Santa Monica, Inc. regarding extending the Ambassador Program to Reed Park but found it to be cost prohibitive. Siting Ambassadors at Reed Park, which is further from the Downtown core in which the Ambassadors operate, to provide daily hospitality services and restro om monitoring, would cost between $520,000 and $572,000 annually. Therefore, at this time staff is focused on continuing to pursue a site-specific activation strategy of recreational, cultural, and enrichment programs, events, and activities for youth, fam ilies, adults, and seniors as well as a communication and outreach campaign. As one means to increase programming in and activate Reed Park, staff will return to Council during the summer of 2017 with a proposed reduction to the current annual fee structure for fitness instruction, classes and camps operating in Reed Park and recommendations for a pilot program. Commercial fitness or athletic instruction, classes, or camps in City parks and on Santa Monica State Beach are currently subject to a Permit Fee, which was set by Council in 2013 at $100 and subject to annual CPI 6 of 14 increases. An additional $50 Permit Fee is added if an RFP, lottery or other allocation process is required to compensate for additional staff time. In addition to the Permit Fee(s), an annual charge for use of the City parks and the Santa Monica State Beach is imposed: $1,800 for small group (not more than 2); $3,600 for medium group (not more than 10); $5,400 for large group (more than 10). Currently, a 50% reduction in annual charge is applied for groups operating in Reed Park. Modifying the existing requirements further for Reed Park may incentivize use, potentially attracting new fitness instructors not currently under the permit system and/or entice current permitted instructors to re-locate to Reed Park. Homeless Multi-disciplinary Street Team Council noted the need to continue funding the Homeless Multi-disciplinary Street Team (HMST), one of the “jump start” projects associated with the Addressing Homelessness Strategic Goal, which began operating in September 2016. The team consists of four full-time staff and a part-time psychiatrist through a contract with The People Concern, joined by medical staff from Venice Family Clinic, and provides care on the streets, in parks, jails and hospitals to the highest utilizers of City emergency services (police, fire, hospitals). It is funded through December 2017 with $300,000 in one-time City of Santa Monica funds. Since the May 24, 2017 Budget Study Session, staff has learned that Supervisor Sheila Kuehl has agreed to provide $300,000 in discretionary funds to sustain the program through June 2018 and will consider an additional grant for the same amount for FY 2018-19 operations. City funding of $300,000 is requested to sustain the program through June 2019. The extension of the program would also allow for an assessment of “step down” interventions post -housing to determine how best to transition participants from HMST to other lower-intensity support services, thereby allowing the team to serve new individuals. Discussions are also underway to engage the business community to support this project as another on-going source of partial funding. Staff is recommending that Council approve the transfer of $300,000 in General Fund “jump start” funding in FY 2018-19 to extend the program an additional year as a “proof of concept” project. This extension would result in a strong, multi-year data set upon 7 of 14 which to evaluate the effectiveness of this intervention. As demonstrated by other evaluative tools such as the Wellbeing Index and the Youth Report Card, demonstrating social impact interventions requires consistent multi-year assessments to measure impact over time. RAND will evaluate the program, looking specifically at the effectiveness of the intervention for this highly vulnerable population and to see if the service model results in fewer contacts with local emergency services. Social Safety Net Council expressed concern that the budget proposed by the Trump Administration could have severe impacts on the members of our community with the greatest need and fewest options. While the federal budget is only a proposal at this point and is expected to undergo significant modification by Congress, the threat is significant. A preliminary review of FY 2016-17 funding sources for the 20 Human Services Grants Program (HSGP) funded agencies indicates that they rely on $21 million in federal funding. This represents approximately 13% of the HSGP-funded agencies’ budgets. In addition, agencies report a $65 million reliance on other (state and local) government sources, portions of which could originate from federal sources, for an additional 40% of their agencies’ budgets. Staff is working with local agencies to project direct and indirect impacts of proposed safety net cuts at both the agency and community level. Staff will also coordinate with state and regional entities to avoid duplication of effort and ensure local funds are used to fill local gaps. Among the programs slated for elimination are the Department of Housing and Urban Development’s (HUD) Community Development Block Grant (CDBG) and HOME programs. $201K of the City’s annual $1.03 million CDBG allocation is granted to the Legal Aid Foundation of Los Angeles (LAFLA) ($80K), Westside Center for Independent Living (WCIL) ($36K), Chrysalis ($40K), and St. Joseph Center ($45K). The Housing Division also uses CDBG for rehabilitation of 20 existing apartments per year where low-income households earning 80% of AMI reside. The HOME Program provides assistance totaling $437,000 to 16 households, and another 10 voucher 8 of 14 holders are currently searching for apartments. The average monthly subsidy for all participants is over $15,000. Both of these grants also provide administrative funds to reimburse the City for the costs of administering the programs. HUD’s Section 8 program provides a monthly housing subsidy to 995 households that totals over $11 million. An estimated $500,000 decrease in funding is possible with passage of the Trump Administration budget. If the budget is decreased by $500,000, approximately 100 households could lose their housing subsidies. While more research is needed to assess grantee needs, staff estimates that the annual impact of the current budget proposal on the City’s programs could be approximately $1.5 million. Staff will continue to monitor budget negotiations in Congress. Once a final federal budget is adopted, staff will confirm any impacts in Santa Monica, as well as potential options for addressing the local need. Los Amigos Restrooms Council requested an update on progress to improve the area surrounding the Los Amigos restrooms. Staff is working with the contractor for the Los Amigos Cistern Project to remove the infield clay recently installed and replace it with decomposed granite. There was also a hose bib near the problematic location causing ponding that has been removed. The expectation is that these efforts will be sufficient to resolve the pathway issues. However, staff will continue to monitor the situation and if there are still issues at this location, staff will also obtain a cost estimate to install a concrete path. Woodlawn Cemetery Council noted a need for increased maintenance along 17th Street adjacent to Woodlawn Cemetery. There are currently 4 public litter containers on the west side of 17th Street between Delaware and Pico. Two of these containers were added in the past six months. There is room to add two more, one in a cut out area and the other near the fire hydrant. RRR staff will deliver two additional containers for a total of six. 9 of 14 Public Landscape renovated plantings along this stretch of 17th Street in March at the request of Councilmember Vazquez. As a part of this project a new irrigation system, plant materials and landscape mulch were installed (see Attachment P). The new plantings are being established and will ultimately fill in the landscaped area. Proposed Budget Revisions Modifications to the Proposed Budget, known as final changes, are based on Council direction, new information and identified omissions. The changes increase the budget by $1.2 million in FY 2017-18 and $0.7 million in FY 2018-19. In FY 2017-18, the changes primarily reflect use of one-time funds to support Vision Zero projects, staffing adjustments, and an adjustment in the Wastewater Fund to reflect updated costs for shared use of the Hyperion Treatment Plant. In FY 2018-19, the changes primarily reflect ongoing costs for adjustments made in FY 2017-18. An additional information-only change will be made to the capital improvement budget to reflect staff’s upcoming recommendation that the City issue lease revenue bonds for the construction of Fire Station 1 in FY 2017-18. The change from pay as you go funding to bond funding will take advantage of an optimal bond market. Staff will return to Council to request authorization to issue a bond at an appropriate time. Staff recommends that Council adopt the changes to the FY 2017-18 Proposed Budget, and approve changes to the FY 2018-19 Proposed Budget. With these changes, the budget remains balanced. Changes are itemized in Attachment D. Council Discretionary Funds Each year, Council allocates discretionary funds to assist the community in special projects or support important but otherwise unfunded priorities. Traditionally, Council has supported community partners like the Business Improvement Districts, Santa Monica traditions like the Fourth of July Parade, one-time programs, and community students through science or music grants allowing Santa Monica youth 10 of 14 to participate in special events. Allocation of the funds may occur along with Budget Adoption or throughout the year. Including unprogrammed FY 2016-17 discretionary funds and FY 2017-18 discretionary funds, the Council has access to $553,762 in discretionary funds in FY 2017-18. Fees/Fines/Rates During the budget study sessions, departments presented adjusted or new fees and rates that were included in the Proposed Budget and recommended in the comprehensive fee study. Staff anticipates that implementation of the fee study recommendations would result in approximately $1.2 million in additional revenue, $0.7 million of which is in the General Fund. As part of the adoption of the FY 2017-19 Budget, staff is presenting three fee/fine/rate related resolution s to Council for adoption. The master fee resolution (Attachment E) contains user fees and rates charged by the City, primarily fees analyzed in the recent fee study as well as new regulatory fees related to the City’s water neutrality ordinance. In addition, a master fine resolution (Attachment F) is being presented that includes all fines assessed by the City in one resolution. This includes administrative citation fines, parking violation fines, library fines, and fines for excessive responses to false a larms by the Police and Fire Departments. Two new non-standard fines for violations of the Municipal Code related to tenant harassment have been added as well as a new Library fine for overdue teen laptop rentals. Finally, a comprehensive parking rate reso lution (Attachment G) includes the recommended changes to beach parking rates presented during the budget study sessions, a pilot program for employees of businesses located in the downtown area, as well as a specific bulk parking fee for the California Judicial Council for one year to allow for the Council to address budget impacts resulting from the City not renewing its parking agreement with the Council in anticipation of the multipurpose sports field . The beach parking rate increase is set to take effect on November 1, 2017. Resolutions related to enterprises or mitigation fees will continue to be separate and will be updated and presented to Council in the future as appropriate. Personnel Changes 11 of 14 As part of the budget process, proposed employee classification and compensation changes were reviewed by the Human Resources Department and the City Manager’s Office. The resulting classification and salary changes and position list are presented in Attachments H and I. Budget Resolutions Adopting the resolutions in Attachments A, B, C would: 1. Adopt the FY 2017-18 and approve the FY 2018-19 budget revenues at the account level, with operating expenditure appropriations for the Salaries and Wages and Supplies and Expenses (including Capital Outlay) major expen diture categories within a fund for each department, and capital improvement program budget within a fund; 2. Authorize staff to roll over appropriations for multi-year operating grants not completed at the end of the fiscal year, unspent donations dedicated to programs, and the encumbrances for goods and services contracted for by FY 2016-17 year-end but not delivered or provided until FY 2017-18; 3. Authorize staff to roll over appropriations for the General Fund and all other Non - General Fund unencumbered balances and unexpended encumbrances for the FY 2016-17 capital improvement program budget. Gann Appropriations Limit State law places limits on the amount of Santa Monica’s General Fund appropriations that can be made without voter approval based on a growth factor calculated on changes in Santa Monica’s population and either State per capita personal income growth or the growth in non-residential assessed valuation. This restriction was placed in effect in November 1979 with the approval of Proposition 4, commonly known as the (Paul) Gann Initiative. The City’s Gann Appropriations Limit, based on growth in non - residential assessed valuation times the annual percentage population change for the City in FY 2017-18 is $2,013,078,428. A comparison of the City’s FY 2017-18 Gann Appropriations Limit as set forth in the City’s Proposed FY 2017-18 Budget follows: 12 of 14 Proposed Gann Limit-related Spending for FY 2017-18 Gann Limit $2,013,078,428 Appropriations Subject to Limitation 256,590,386 Net (Over) Under $1,756,488,042 FY 2017-18 appropriations subject to limitation are $1,756,488,042 less than the City’s Gann Appropriations Limit. A resolution to establish the City’s FY 2017-18 Gann Appropriations Limit is included in Attachment J. Human Services Grants Program (HSGP) and Organizational Support Program (OSP) for Santa Monica’s Arts and Culture Non-Profits The FY 2017-19 Proposed Biennial Budget includes continued funding to most grantee organizations at the FY 2016-17 funding levels, plus a 2.2% cost of living adjustment to the General Fund portion of each grant. The proposed budget also includes an enhancement to the HSGP in the amount of $173,500, which will increase grant funding for Connections for Children’s Santa Monica Early Education program. This program provides childcare subsidies to low- and moderate-income Santa Monica families with children up to kindergarten age. The increased funding will support an additional 10 program participants. Attachments K and L list the individual grantee agreements approved for funding through the FY 2015-19 Human Services Grants Program and Cultural Arts Organizational Support Program, along with the grant amounts for the FY 2017-18 Budget. Acceptance of Federal Continuum of Care (CoC) Renewal Grants The Continuum of Care (CoC) Program is a Federally-funded competitive grant program that provides a housing subsidy (supportive housing) to chronically homeless, disabled households. On June 1, 2017, the U.S. Department of Housing and Urban Development (HUD) awarded two Continuum of Care (CoC) grants in the amounts of $2,786,792 and $478,782. Staff is requesting authorization to accept the grant funds from HUD, for a one-year renewal. 13 of 14 Financial Impacts and Budget Actions Adoption of the Proposed Budget as amended by Attachment D would formally adopt the first year and approve the second year of the City’s FY 2017-19 Biennial Budget, including the second year of the FY 2016-18 Capital Improvement Program Budget. Prepared By: Susan Lai, Budget Manager Approved Forwarded to Council Attachments: A. City Council Resolution Adopting the First Year (FY 2017 -18) and Approving the Second Year (FY 2018-19) of the FY 2017-19 Biennial Budget and Adopting its CIP Budget for FY 2017-18 B. Housing Authority Resolution Adopting the First Year (FY 2017-18) and Approving the Second Year (FY 2018-19) of the FY 2017-19 Biennial Budget and Adopting its CIP Budget for FY 2017-18 14 of 14 C. Parking Authority Resolution Adopting the First Year (FY 2017-18) and Approving the Second Year (FY 2018-19) of the FY 2017-19 Biennial Budget and Adopting its CIP Budget for FY 2017-18 D. Revisions to Proposed FY 2017-19 Expenditure Budget Appropriations E. Fee Resolution F. Fine Resolution G. Parking Rates Resolution H. Resolution Establishing New Classifications and Adopting Salary Rates for Various Listed Positions I. Proposed FY 2017-18 Position and Classification Changes J. Resolution Establishing Gann Appropriations Limit for FY 2017-18 K. FY 2017-18 Human Services Grants Program Funding Summary L. FY 2017-18 Organizational Support Program Funding Summary M. January 24, 2017 Staff Report N. May 23, 2017 Staff Report O. January 28, 2017 Staff Report P. Woodlawn Cemetery Photos Q. Written Comments R. Written Comments Exhibit L - Office of Sustainability and the Environment Service FY 18-19 Fees Landscape & Irrigation Onsite Inspection Fees (includes all inspections)$249.34 Urban Runoff Mitigation Onsite Inspection Fees Per Property, includes 2 inspections $170.18 For each additional inspection $67.00 Water Neutrality Administrative Fee - Single-Family/Multi-Family Units 1-101 $1,183.20 Administrative Fee - Multi-Family Units 11-501 $1,688.10 Administrative Fee - Commercial/Mixed Use 51+units1 $2,539.80 Performance based direct offset of additional water - plan check $332.47 Performance based direct offset of additional water - inspection $166.23 In-Lieu Fees Fixture Description1 Purchase and Installation Cost per Fixture Tank Toilet ADA 0.8 gpf1 $339.66 Tank Toilet Non-ADA 0.8 gpf1 $323.34 Tank Toilet ADA 1.0 gpf1 $622.20 Tank Toilet Non-ADA 1.0 gpf1 $583.44 Tank Toilet ADA 1.28 gpf1 $367.20 Tank Toilet Non-ADA 1.28 gpf1 $312.12 Flushometer Toilet ADA 1.28 gpf1 $499.80 Flushometer Toilet Non-ADA 1.28 gpf1 $474.30 Urinal ADA/Non-ADA 0.125 gpf1 $538.56 Showerhead 1.5 gpm $107.10 Faucet Aerator Residential 1.0 gpm1 $73.44 Faucet Aerator Residential 1.5 gpm1 $73.44 Faucet Aerator Commercial 0.5 gpm1 $73.44 Faucet Aerator Commercial 1.51 $87.72 Notes: 1 Fees are not subject to the City's established annual administrative revision and increase. L - 1Office of Sustainability and the Environment 1 City Council Meeting: February 12, 2019 Santa Monica, California RESOLUTION NUMBER _________ (CCS) (City Council Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA INCREASING WATER NEUTRALITY FEES FOR NEW DEVELOPMENT WHEREAS, California has endured a severe multi-year drought that has threatened the water supplies of communities and residents, devastated agricultural production in many areas, and harmed fish, animals and their environmental habitats; and WHEREAS, the City desires to continue to adopt and adhere to permanent changes to use water more wisely and to prepare for more frequent and persistent periods of limited water supply; and WHEREAS, on January 8, 2019, the City Council adopted changes to Santa Monica Municipal Code Section 7.16.050 (“Section 7.16.050”) (the City’s water neutrality ordinance) to expand the applicability of the City’s water neutrality ordinance, modify the definition of baseline water demand in the ordinance, and align the ordinance’s terminology with the City’s planning and development procedures ; and WHEREAS, Section 7.16.050(i) authorizes the City to charge a dministrative fees to permit applicants at the time of issuance of a building permit to cover the cost of administering and implementing the water off-set requirements in Section 7.16.050(d); and 2 WHEREAS, Section 7.16.050(j) authorizes the City to charge in-lieu fees to permit applicants to be used to reduce new water demand citywide; and WHEREAS, the aforementioned administrative and in-lieu fees are pass-through costs charged to the City by the City’s water neutrality vendor, DNV GL; and WHEREAS, the City Council authorized the City’s current contract with DNV GL (“Contract No. 10496”) on July 11, 2017; and WHEREAS, Contract No. 10496 authorizes a fee increase of 2% from the specific fee rates set forth in Contract No. 10496 , effective as of December 31, 2018; and WHEREAS, on June 12, 2018, the City Council adopted Resolution No. 11121 (CCS), which incorporated the fees for Contract No. 10496 in effect as of July 1, 2018 into the “Water Neutrality” section of Exhibit L of Resolution No. 11121 (CCS); and WHEREAS, the City Council now desires to authorize the pass-through of the 2% increase authorized by Contract No. 10496 , effective December 31, 2018, by replacing the fees in the “Water Neutrality” section of Exhibit L attached to Resolution No. 11121 (CCS) with the “Water Neutrality” fees attached to this Resolution; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS: SECTION 1. The administrative fees authorized by Santa Monica Municipal Code Section 7.16.050(i) are hereby established as set forth in the fee schedule attached hereto, effective February 18, 2019. SECTION 2. The in-lieu fees authorized by Santa Monica Municipal Code Section 7.16.050(j) are hereby established as set forth in the fee schedule attached hereto, effective February 18, 2019. 3 SECTION 3. The administrative and in -lieu fees established by this Resolution shall replace in their entirety the fees in the “Water Neutrality” section of Exhibit L attached to Resolution No. 11121 (CCS). SECTION 4. If there are any conflicts between the fees and rates adopted in this Resolution and any prior adopted resolution or schedule, the fees and rates adopted through this Resolution shall take precedence. SECTION 5. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: _________________________ LANE DILG City Attorney 1 Thania Montoya From:The SEO Doctors <theseodoctors@gmail.com> Sent:Monday, February 11, 2019 8:35 PM To:Clerk Mailbox Subject:Council 2/12/19 - Item 3G Follow Up Flag:Follow up Flag Status:Flagged Adopt 2% fee escalation for water neutrality. Yes. Korie Schmidt (310)600-2278 TheSEODoctors@gmail.com Item 3-G 02/12/2019 1 of 1 Item 3-G 02/12/2019 REFERENCE: Resolution No. 11160 (CCS)