Exhibit CC 09-21-2010 No. 13 C 7 / i t /0
FISCAL STRATEGIC PLAN COMMITTEE RECOMMENDATIONS 3
ITEM #13 \\ 1/
Additional Items Requested 9/20/10 Page # � S<.'D S r
1- Committee Minutes CUPERTINO
July 27, 2010 1
August 24, 2010 2
2- Potential Revenue from fee increase 4
3- Tax Equity Allocation /ERAF Recaps 5
4- Capital Project Information
CIP Summary Funding 7
Budget Reduction Effects 8
BBF Infrastructure Project 9
AM Radio Project Cost Savings 10
5- Committee Active and Archived Revenue
and Expenditure Ideas 13
City of Cupertino
Fiscal Strategic :Plan Committee
Minutes
July 27, 2010
CALL TO ORDER
At 3:07 p.m. Carol Atwood called the meeting to order at Cupertino City Hall, 10300
Torre Avenue, Conference Room B, Cupertino, CA.
2. ROLL CALL
Present: Kris Wang, Orrin Mahoney, Carol Atwood, Kelly Kline, David Woo
Absent: Aarti Shrivastava, Roger Lee
3. APPROVAL OF MINUTES
Mayor Wang moved to approve the minutes of May 20, 2010. Councilmember Mahoney
seconded and motion passed unanimously.
4. ORAL COMMUNICATIONS - None.
5. WRITTEN COMMUNICATIONS - None.
6. OLD BUSINESS — None.
7. NEW BUSINESS
A. Identify Strategic Plan Recommendations to address HP move
Committee members discussed reasons and the timing of HP's move to Palo Alto, the
tax and revenue impacts of their leaving, the revenue impacts of possible new
businesses, and the real estate market for the property. After reviewing strategies to
address the move, the Committee will recommend that the City Council adopt fee
schedule increases for fiscal year 2010 -11, pursue Educational Revenue
Augmentation Fund property tax corrections with the State, and consider deferral or
elimination of various capital projects for 2010 -11.
B. Update Storm Drain Fee project
From their visit with City of Palo Alto officials, Carol Atwood and Kelly Kline
reported that citizen group backing was key to a successful storm drain fee election.
A mail -in ballot process involving property owners, requires a majority vote, and
appears to be the more feasible approach. The Committee agreed to pursue this
project.
8. ADJOURNMENT
The meeting was adjourned at 4:35 p.m.
David Woo, Finance Director
City of Cupertino
Fiscal Strategic Plan Committee
Minutes
August 24, 2010
1. CALL TO ORDER
At 3:12 p.m. Carol Atwood called the meeting to order at Cupertino City Hall, 10300
Torre Avenue, Conference Room A, Cupertino, CA.
2. ROLL CALL
Present: Kris Wang, Orrin Mahoney, Carol Atwood, Aarti Shrivastava, Roger Lee, David
Woo
Absent: Kelly Kline
3. APPROVAL OF MINUTES
Aarti Shrivastava noted a correction to the roll call of the July 27, 2010 minutes. Mayor
Wang moved to approve the minutes with the correction. Councilmember Mahoney
seconded and motion passed unanimously.
4. ORAL COMMUNICATIONS - None.
5. WRITTEN COMMUNICATIONS - None.
6. OLD BUSINESS — None.
7. NEW BUSINESS
A. Budget Cuts /Deferrals
Agenda Items 7A and 7B were discussed concurrently. Carol Atwood, Mayor Wang,
and Councilmember Mahoney discussed the status of board elections in Sunnyvale,
Palo Alto, and Cupertino Sanitary District moving to even years. It was decided that
the City will monitor the actions in these jurisdictions and school districts with their
effect on election costs and then bring a report about even -year elections to the City
Council. The same Committee members discussed the outcomes of staff meetings
with Hewlett- Packard about the timing of their move and tax revenue possibilities. It
was noted that City actions did not affect HP's decision. Development plans and
revenue opportunities of the Shashi Corporation hotel on DeAnza Boulevard were
also discussed.
Committee members, along with Terry Greene from City staff and Ralph Qualls
formerly from City staff, went over a list of potential action items in lieu of HP's
relocation. It was decided that the following actions will be brought to the September
21, 2010 Council meeting: Revisit FY 10 /11 fee increases, pursue ERAF property tax
correction, new assessment for storm water program, and reduce or defer the project
budgets of Blackberry Farm infrastructure, antenna relocation, emergency van,
Wilson Park irrigation system, park path/parking lot/school field trail resurfacing, and
Mary Avenue dog park.
B. Revenue Enhancement - Discussed concurrently with Agenda Item 7A.
Potential Revenue from Fee Increase
Annual Prorated
Potential Revenue
2008/09 Fee Revenue Increase
Revenue Increase Increase (1) (2)
General Fund
Building $2,716,366 2% $54,327 $30,559
Planning 379,821 2% 7,596 4,273
Engineering 490,804 2% 9,816 5,522
Senior Ctr Membership 55,518 $3 6,385 3,591
BBF picnic & pool (2009/10) 126,000 0% - -
n- ...l,:.... r;� 10,1 CCA no%
rdl Kin r111CJ lu`T, ■J WV
Recreation Facility Rentals 161,222 0% - -
Other Service Charges 81,150 2% 1,623 913
Total General Fund 4,195,445 79,747 44,858
(1) Assuming same business volume.
(2) Effective 12/6/10
Tax Equity Allocation (TEA) S anta Clara County /Los
Altos = Hilis Monte Sereno Saratoga, Cupertino
Fact S ..
PROBLEM THIS REQUEST
The ERAF rate that the County was remitting was
When Proposition 13 passed in 1978, it froze 47.7 %, compared to the rate for the four separate
property taxes at their current levels. This action cities, which ranged from 7.53% to 17.37 %. Due to
created significant problems for cities that at the this difference, approximately $2.592 million in
time had low property tax rates, because they property tax dollars is still not vesting to these cities.
couldn't raise those rates to meet their community They are being treated differently than the other
needs. In Santa Clara County, four cities were TEA cities adjusted with Section 98 of the
significantly below the average rate: Los Altos Hills, California Revenue and Tax Code.
Cupertino, Saratoga and Monte Sereno.
SUMMARY
Section 98 of the California Revenue and Taxation
Code was passed to correct this situation, giving Legislative reallocation of scarce property tax
qualified cities what is referred to as Tax Equity dollars frequently leads to bitter Local controversies.
Allocation (TEA). If the County accepted trial court By repealing Santa Clara County's unique 55% limit
funding, it also had to provide at least 7% of the on TEA funding, AB 117 eliminated a long- standing
property tax to its cities. Impacts to ERAF created source of contention between the County and
by the shift were backfilled by the state. Santa its four -no /low cities.
Clara County told its TEA cities that the amount of
revenues the County would receive from trial court The inconsistency of ERAF requirements for all
funding would not offset the amount it would lose TEA cities however still exists. Impacts to ERAF
by bringing its TEA cities up to 7 %. as a result of the shift in property tax should be
automatically backfilled by the state for these last
Consequently, legislation was enacted which limited four effected cities per current law, like every
the four TEA cities in Santa Clara to just 55% of other county and city in California.
what other TEA cities in the state received. The
four TEA cities in the Santa Clara County were
the only cities in the state disadvantaged by this Staff Contact: Carol Atwood (408) 777 - 3226
legislation. Date: November 20, 2007
In 2006, Assembly Bill 117 repealed the 55% limit
in the County of Santa Clara on Tax Equity
Allocation (TEA) funding for the county's four
no /low- property-tax cities. The State, however,
required the cities to continue to remit the
County's ERAF rate on these funds so that the
bill would have no effect on the State budget and
would avoid the Appropriations Committee.
5-
Tax Equity Allocation (TEA) Calculations
Estimates as of October 29, 2007
Cupertino Saratoga Los Altos Hills
Original Additional Total Original Additional Total Original Additional Total
Tax 'Tax Tax Tax Tax Tax Tax Tax Tax
Allocation from AB117 after AB117 Allocation from AB117 after AB117 Allocation from AB117 after AB117
City's Property Tax Allocation % 4.79% 2.21% 7.00% 5.38% 1.62% 7.00% 5.43% 1.57%
Less: State's ERAF Withholdings %: (11.90 %) (47.70 %) Total (17.14 %) (47.70 %) Total (1737 %) (47.70 %) Total
Total AB 8 Allocated Amount 124,694,960 98,004,950 44,953,616
Less: Net RDA (169,461) - -
Net AB 8 Allocations 124,525,499 98,004,950 44,953,616
Property Tax Revenue before and after AB117 5,973,271 2,743,514 8,716,785 5,272,142 1,588,202 6,860,344 2,439,880 706,873 3,146,753
Less: AB 8 allocated (192,128) - (192,128)
Net City Allocation: (ERAF shift is calculated on
this amount, which is net of AB8 allocated amount
to city's special districts) 5,973,271 2,743,514 8,716,785 5,080,014 1,588,202 6,668,216 2,439,880 706,873 3,146,753
ERAF Property Tax Shift (710,711) (1,308,588) (2,019,299) (870,714) (757,533) (1,628,247) (423,827) (337,161) (760,988)
Net 5,262,560 1,434,926 6,697,486 4,209,300 830,669 5,039,968 2,016,053 369,712 2,385,765
FY 2007/08 TEA Property Tax Allocation Amount $ 2,743,514 5 1588.202 $ 706,873
Current ERAF: County ERAF rate at 47 7% 1,308,588 757,533 337,161
Less: Equitable ERAF: Per City's ERAF rate (326,478) (272,218) (122,790)
Difference in ERAF Rates / Property Tax Revenues received: $ 982,110 $ 485,315 $ 214,371
4 ..,......
s: /property tax /tax age(Iu ni r ciA, i cm uaicuiations- 10- 30- 07.xls
FY 2010 -11, 2009 -10 CIP SUMMARY FUNDING
General Funds
Gas Tax,
ARRA,
General CIP Prop 1B, Park Storm
Total Fund Reserve CIP Fund Developer Recreation BBF Golf Dedication Drain Grant
Pavement Management 3,000,000 750,000 2,250,000
Stevens Creek Corridor Park Phase 2 1,200,000 1,100,000 100,000
Blackberry Farm Infrastructure Upgrades 767,000 767,000
Blackberry Farm Golf Course Irrigation & Upgrades 550,000 400,000 150,000
Storm Drainage System Monta Vista 400,000 400,000
Park Path and Parking Lot Repairs & Resurfacing 250,000 250,000
Trail Resurfacing at School Sports Fields 125,000 125,000
Wilson Park Irrigation Renovation 150,000 150,000
Temporary Dog Park - Mary Avenue 225,000 225,000
Environmental Education Facility 451,000 200,000 251,000
EOC Generator, Connection & Repair 400,000 100,000 300,000
McClellan Repairs & Painting 100,000 85,000 15,000
Stocklmeir Legacy Farm 50,000 50,000
Community Hall AV Upgrades 50,000 50,000
Library Parking 100,000 100,000
Scenic Circle Access 235,000 125,000 110,000
Safe Routes to School- Garden Gate 433,000 39,000 394,000
DeAnza /McClellan /Pacifica Signal Modification 200,000 200,000
Subtotal Projects 8,686,000 2,016,000 550,000 100,000 2,250,000 875,000 150,000 1,100,000 400,000 1,245,000
Minor Maintenance Projects
Stocklmeir Orchard Irrigation 50,000 50,000
Library Fountain 55,000 55,000
AM Station Antenna Relocations 80,000 10,000 70,000
McClellan Ranch 4H Sanitary Connection 45,000 45,000
Quinlan Interior Analysis 30,000 30,000
Service Center Tool Crib 40,000 40,000
Monument Gateway Sign 35,000 35,000
Various Traffic Signal Battery Back up System (Final Phase) 50,000 50,000
Minor Storm Drain Improvements 75,000 75,000
Emergency Van Upgrade - - 75,000 75,000
Subtotal Minor Maintenance Projects 535,000 85,000 310,000 - 35,000 30,000 - - 75,000 -
Total CIP Summary Funding 8,588,000 2,062,000 860,000 100,000 2,285,000 905,000 150,000 1,100,000 475,000 651,000
Ni o 9ra+ - )nor vie
OFFICE OF ADMINISTRATIVE SERVICES
CITY HALL
�ST.iss 10300 TORRE AVENUE • CUPERTINO, CA 95014 -3202
CUPERTINO (408) 777 -3220 • FAX (408) 777 -3109
MEMORANDUM
To: City Council
CC: David Knapp, Carol Atwood , /
From: David Woo, Finance Director /`�-�
Subject: Agenda Item 13 - CIP budget reduction effects
Date: September 21, 2010
These are the effects of the proposed budget reductions on the following capital projects:
a. Reduce various Blackberry Farm Infrastructure Improvements ($75,000)
The maintenance building will not be demolished and relocated. The required ADA
upgrades /replacement of restrooms and upgrade of the retreat center and will go on with
the remaining $725,000 budget.
b. Scale down the Radio Station Antenna Relocation ($10,000)
Comes from projected savings in this $80,000 project to relocate the City Hall
transmitter /antenna and establish a second transmitter /antenna in the City to improve
signal strength during emergencies.
c. Reduce various Park Path and Parking Lot Resurfacing Projects leaving $75,000 for
safety issues only ($175,000)
Original plan to resurface the paths at Linda Vista, Memorial, Portal, Regnart, and
Somerset Parks (including basketball court) and the parking lots at the Senior Center,
Somerset and Varian Parks will be scaled back and re- prioritized.
Carol Atwood
From: David Woo
Sent: Tuesday, September 21, 2010 1:21 PM
To: Carol Atwood; Glenn Goepfert
Subject: BBF Infrastructure Project
Importance: High
Carol & Glenn the following came from Terry Greene in an August 18, 2010 email about trimming $75,000
from the BBF Infrastructure project.
The Blackberry Farm project was budgeted at $800,000 ($500,000 savings from SCCP Phase 1B and $300,000 of new
money in FY 09/10) to provide disabled access to the facilities throughout Blackberry, in compliance with the California
Building Code, and to upgrade the maintenance building and service yard, demo and replace a pair of restrooms near
the maintenance facility. These upgrades were determined to be required by the Building Official following the many
improvements and upgrades that were made to the swimming pools, concession stand, retreat center, and maintenance
facilities as a part of the Phase 1A and 1B project.
• ADA upgrade the Retreat Center
• ADA upgrade of the large men's bath house area
• ADA upgrade of the large women's bath house area
• ADA upgrade of the large men's picnic restroom
• ADA upgrade of the large women's picnic restroom
• ADA upgrade of the small men's picnic restroom
• ADA upgrade of the small women's picnic restroom
• The construction of 3 additional pool rinse showers required by the County Health Department
• The demolition of the two 1950's era restrooms and convert the structure into an electric cart charging station
• The construction of two new uni -sex restrooms near the volleyball and bocce ball courts.
I need to emphasize that all but the electric cart charging station work is required by code and not optional. Technically
it should have been included in the scope of work of Phase 1B, when the work in that phase was expanded to upgrade
the pools and buildings using the bid savings (requested by Parks & Rec). The Building Official (Greg) allowed the Phase
1B work to proceed without the ADA upgrades at that time with the understanding that we would execute the necessary
upgrades shortly thereafter.
We have removed the maintenance building demolition and relocation from the scope and are therefore now able to
return $75,000 to the GF. There may be some additional GF savings at the end of the project, but it would be unwise to
speculate on the amount now.
Carol Atwood
From: Peter Coglianese •
Sent: Tuesday, September 21, 2010 12:51 PM
To: Glenn Goepfert; Rick Kitson
Cc: Carol Atwood; David Woo
Subject: AM Radio Project: Cost Savings
This is a brief informational email describing how we were able to reduce the overall project cost for the AM Radio
Station Relocation project by $10,000.
Most of the cost savings have been realized by coordinating our site preparation work with the Public Works
Department. The Public Works department will be providing two 30 -foot street light poles at each of the AM antenna
site locations. These poles, which normally run about $1,000 each, are available to us at no cost. In addition, we are
proposing to use a Public Works personnel and contractors to help with pole preparation, pole auguring, conduit
installation, electrical power connections, and preparation of the cement pad for the outdoor equipment cabinet.
Additional savings have been realized by employing a wireless FM link transmission system to broadcast the signal to
each of the AM radio antenna sites, thus avoiding the need cf wired connections, additional conduits, and additional
trenching.
Pete
/Q
Carol Atwood
From: David Woo
Sent: Tuesday, September 21, 2010 1:'17 PM
To: Carol Atwood
Subject: FW: AM Radio Project: Rough Cost Estimates
Importance: High
More info Carol
From: Peter Coglianese
Sent: Monday, September 20, 2010 4:24 PM
To: Glenn Goepfert; Rick Kitson
Subject: FW: AM Radio Project: Rough Cost Estimates •
Importance: High
FYI -
This is the latest information I have regarding cost estimates for the AM Radio Project. We may be able to cut costs in
some areas, but I still think the overall cost will be about $70.000...
COST ESTIMATES FOR AM RADIO RELOCATION PROJECT
UPDATED: SEPTEMBER 17, 2010
•
$61,500 - EQUIPMENT AND INSTALLATION
• Satellite Station Configurations ($15,500)
• GPS Frequency Stabilization X2 ($7,000)
• Wireless Audio Link Receiving Stations X2 ($12,000)
• Audio Control Equipment ($2,000)
• Wireless Audio Link Transmission System ($6,000)
• System Engineering and Planning ($1,500)
• Site Choice & Frequency Monitoring Assistance ($500)
• FCC License Application Services ($100)
• Antenna and Cabinet Installation ($2,500)
• Electronics Installation ($3,500)
• FCC Signal Intensity Survey ($3,500)
• Coaxial Cable ($500)
$12,000 - SITE PREPARATION
• 30' Light Poles expressly for the use of mounting system antennas
• Man and Bucket Truck for mounting antennas on poles
• Pole Preparation. Hole drilling /threading for Coax entrances. Two 3/4" Pipe thread holes above ground to
accommodate two antennas at different levels on the pole. Two 1" Pipe Thread below ground; 1 for both
antenna coax to enter the pole from the cabinet. The other to be for Ground Cable from Grounding Element to
enter the pole.
/
• Make certain that there is an inspection plate available on the pole near ground level to aid in pulling coax from
. antennas to underground conduits.
• Pole Auguring and Installation
• Ground Rod Hole Auguring (10' Deep x 6" Diameter)
• 1" Conduit from Ground Rod to Pole
• Cement slab for mounting outdoor cabinets.
• 1" Conduit with pull string from center area of cement slab to pole for routing coaxial cables.
• 1/2" Conduit from center area of slab to exit the slab at just below ground level. This will accommodate #4
grounding cable to small ground rod just off the slab that ISS /Frontline will install.
• Conduit containing AC Power Service. 20W fused or breaker service to center of slab.
ESTIMATED TOTAL PROJECT COST: $73,500
1�
FISCAL STRATEGIC PLAN Implementation Timeline
ACTIVE
Stabilize and Reposition Revenue Sources 2007/08 2008/09 2009/10 2010/11
BMR Fees - Office /Retail /Hotel I C C C
Fee for "Excessive Calls for Service" to commercial properties I I I C
Modify UUT to Include New Technology R I C C
Phase Out One -Time Revenue to General Fund I C C C
Pursue Federal Stimulus Funding I C
Tax Equity Allocation - Phase I I I C C
Tax Equity Allocation - Phase II I I I I
BMR Fees - Units I N R I
Entertainment Tax R N N N
Marijuana Zoning • N N
Re- Zoning Opportunities & Fee charge R N
Road Impact Fees- Oversize Vehicles N N R N
Sale of Water Company R N
Advanced Planning Fee R R
Investigate Storm Drain Fee increase R
Online Permits R
Parcel tax for library funding R
Pursue Library Funding Options R R R R
Review BMR Program R
Re -visit City fee schedule R
Sales Tax increase N R
Technology Reserve R R
Decrease Expenditures and Risk Exposure
Paperless Agendas R I
Consent Calendar R I
Even Year Municipal Elections R R
Electronic Outreach - Citywide notifications R R
Completed and /or policy in place C
In process /to be implemented
Not approved at this time N
Under Review R
l3
FISCAL STRATEGIC PLAN Implementation Timeline
ARCHIVED
Stabilize and Reposition Revenue Sources 2007/08 2008/09 2009/10 2010/11
Re- assess Park Dedication Fees C C C C
Support Redevelopment Projects C C C C
Annexation of Quarry Property N N N N
Approach Foothill /DeAnza to Share Sheriff Costs R R R N
Refuse Vehicle Impact Fee N N N N
County Communications Fee N N N N
Subdivide /Sell Simms Property - Phase 2 of SCC N N N N
Decrease Expenditures and Risk Exposure
Require Developers to Maintain Open Space • C C C C
CIP If On -going Maintenance Funding Available C C C C
Increase BL, NW, CERT Graduates C C C C
Change Accounting for Enterprise Funds I C C C
Cost Saving Options for Medical /Retiree Medical I I C C
Require Safety Enhancements /New Development R N N N
Contract School Maintenance R N N N
Adopt Tree Maintenance Ordinance N N R N
Adopt Sidewalk Liability Ordinance N N R N
Review Sanitary Sewer District Structure R N N
Completed and /or policy in place C
In process /to be implemented I
Not approved at this time N
Under Review R
G: \Finance \Strategic Plan \Implementation Timeline Aug 24 2010.xlsx ,