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HomeMy WebLinkAboutStaff Report 428-10TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: LIBRARY DATE: DECEMBER 13, 2010 CMR: 428:10 REPORT TYPE: CONSENT SUBJECT: Adoption of an Ordinance Amending the Budget for Fiscal Year 2011 to Accept a Donation in the Amount of $275,000 from the Palo Alto Library Foundation; Establish Capital Improvement Program Project Number LB-11000, Furniture and Technology for Library Measure N Projects; and Provide an Appropriation in the Amount of $275,000 to CIP Project LB-llOOO RECOMMENDATION Staff recommends City Council approve a Budget Amendment Ordinance (BAO) in the amount of $275,000, a gift from the Palo Alto Library Foundation (PALF). Staff further recommends a new CIP project be established to appropriate this amount to the purchase of furniture, equipment and technology for library Measure N building projects. This CIP project will be fully funded from gifts received by the Palo Alto Library Foundation or other donors, and, if needed, supplemented with library development impact fees and community center development impact fees. BACKGROUND On November 4,2008, Palo Alto voters passed Measure N, authorizing the issuance of up to $76 million in general obligation (GO) bonds, to fund library and community center capital improvements. The proceeds from the GO bond authorized by the measure will be used to construct a new Mitchell Park Library and Community Center, expand and renovate Main Library, and renovate Downtown Library. By state law, proceeds of a GO bond cannot be used to purchase non-capital furniture, equipment, and fixtures (FF&E) for the facilities. In 2008, Group 4 Architecture, the firm hired by the City to design the bond measure projects, estimated these costs at $4.3 million for the three improved facilities. The Palo Alto Library Foundation, a 50lc (3) nonprofit organization, was founded in 2001 to provide financial support to the Palo Alto City Library. PALF, along with the Friends of the Palo Alto Library, have been strong partners for the City, with records of success in financial CMR: 428:10. Page 1 of3 ! J I I I support of the library system. P ALF raised over $1 million in private donations to rebuild and furnish the Children's Library, which was reopened in 2007. Following the passage of Measure N, the Board of Directors of PALF agreed to undertake a campaign to fund. the needed furniture and technology for the library and community center projects. The fundraising goal is $5 million which includes Group 4's estimate plus $0.7 million for associated costs and contingencies. DISCUSSION P ALF plans to collect the donations made to its fundraising campaign and tum the proceeds over to the City in three or more gifts. The gifts will be timed to make the funds available as furniture and technology are needed for the individual building projects. The first gift of $275,000 was presented at the September 6, 2010 City Council meeting, and will be used to fully fund all required furniture and technology needs at Downtown Library. This is the first Measure N library branch to be renovated and has an anticipated completion date of June 2011. Revenue for the CIP in FY 2012 and 2013 will fund FF&E for the new Mitchell Park Library/Community Center and renovated Main Library. Revenue will be funded through gifts and, if needed, with library development impact fees and community center development impact fees. The gifts are critical to the completion of the library and community center upgrades as the City's General Fund currently does not have the capadty to support the needed furniture and technology purchases. RESOURCE IMPACT Furniture, equipment and technology purchases will be fully funded through gifts, and if necessary, supplemented with library development impact fees and community center development impact fees. As of June 30, 2010, $519,727 is available in library development fees and $258,000 in community center impact fees, which may be added as necessary to fund the CIP for appropriate expenses. If the development impact fees are used, the balances will drop in accordance with corresponding expenses. Maintenance and replacement expenses resulting from the furniture, equipment and technology purchases will have to be funded by the General Fund. Staff is working to identify funding plans for these items. POLICY IMPLICATIONS This report does not represent any change to existing City policies. ENVIRONMENTAL REVIEW . The recommendation in this report does not constitute a project requiring environmental review under the California Environmental Quality Act (CEQA). ATTACHMENTS Attachment A: Budget Amendment Ordinance Attachment B: CIP LB-ll 000 Furniture and Technology for Library Measure N Projects CMR: 428:10 Page 2 of3 PREPARED BY: DEPARTMENT HEAD APPROV AL: CITY MANAGER APPROVAL: CMR: 428:10 SUSAN BODENLOS Management Assistant DHIMMEL Interim Library Director JAME ENE City~er . 0 Page 3 of3 Attachment A ORDINANCE NO. ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING THE BUDGET FOR FISCAL YEAR 2011 TO ACCEPT A DONATION IN THE AMOUNT OF $275,000 FROM THE PALO ALTO LIBRARY FOUNDATIONj ESTABLISH CAPITAL IMPROVEMENT PROGRAM PROJECT NUMBER LB- 11000, FURNITURE AND TECHNOLOGY FOR MEASURE N PROJECTS; AND PROVIDE AN APPROPRIATION IN THE AMOUNT OF $275,000 TO CIP PROJECT LB-ll000 The Council of the City of Palo Alto does ordain as follows: =======-=' The Council of the City of Palo Alto finds and determines as follows: A. Pursuant to the provisions of Section 12 Article III of the Charter of the City of Palo Alto, the Council on June 28, 2010 did adopt a budget for fiscal year 2011; and B. On November 4, 2008, Palo Alto voters passed Measure N, authorizing the issuance of up to $76 million in general obligation (GO) bonds, to fund library and community center capital improvements. The proceeds from the GO bond authorized by the measure will be used to construct a new Mitchell Park Library and Community Center, expand and renovate Main Library, and renovate Downtown Library. By state law, proceeds of a GO bond cannot be used to purchase non-capital furniture, equipment, and fixtures for the facilities; and C. In 2008, Group 4 Architecture, the firm hired by the City to design the bond measure projects, estimated costs of furniture, equipment and fixtures to be at $4.3 million for the three improved facilities plus $0.7 million for associated costs and contingencies; and D. The Palo Alto Library Foundation (PALF), a 501c (3) nonprofit organization has been a strong partner for the City, with records of success in financial support of the library system. Following the passage of Measure N, the Board of Directors of PALF agreed to undertake a campaign to fund the needed furniture and technology for the library and community center projects; and E. PALF plans to collect the donations made to its fundraising campaign and turn the proceeds over to the City. The gifts will be timed to make the funds available as furniture and technology are needed for the individual building projects. The first gift of $275,000 was presented at the September 6, 2010 City Council meeting, and will be used to fully fund all required furniture and technology needs at Downtown Library; and F. A creation of a CIP Project is needed to capture all the donations of PALF, and all the expenditures related to the donations; and G. City Council authorization is needed to amend the 2011 budget as hereinafter set forth. SECTION 2. Capital Improvement Program (CIP) Project Number LB-11000, Furniture and Technology for Measure N Projects is hereby created. SECTION 3. Donation revenue from the Palo Alto Foundation of Two Hundred Seventy Five Thousand ($275,000) is hereby received and, the sum of Two Seventy Five Thousand Dollars ($275,000) is appropriated to CIP Project LB-11000. ) Library Dollars Hundred hereby SECTION 4. The transactions above will have no impact on the Capital Project Fund Infrastructure Reserve balance. SECTION 5. As specified in Section 2.2S.0S0(a) of the Palo Al to Municipal Code, a two-thirds vote of the City Council is required to adopt this ordinance. SECTION 6. As provided in Section 2.04.330 of the Palo Alto Municipal Code, this ordinance shall become effective upon adoption. SECTION 7. The actions taken in this ordinance do not constitute a project requiring environmental review under the California Environmental Quality Act (CEQA). INTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: City Clerk Mayor APPROVED AS TO FORM: ty Manager Director of Library Director of Administrati've Services ATTACHMENT B CIP Description: This project will purchase new furniture, equipment and technology for the Measure N bond projects at the new Mitchell Park Library and Community Center, the expanded and renovated Main Library and the renovated Downtown Library. Justification: In 2008, the community passed Bond Measure N, thereby authmizing the construction or renovation of three library branches. By law, general obligation bond funds cannot be used to purchase non­ capital items for the facilities. This project is needed to accept gifts from the Palo Alto Library Foundation or other organizations to fund the purchase of essential furniture, equipment and technology. Supplemental Information: First year funding to purchase all needed furniture, equipment and technology for the Downtown Library renovation was provided by the Palo Alto Library Foundation. Future year revenue will be funded by gifts from the Foundation or other donors and, jf needed, supplemented by library development impact fees and community centers development impact fees. Pre-Design Costs Design Costs Construction Costs • New • Timeline: FY 2011 through FY 2014 • Overall Projed Completion: 0% • Percent Spent: 0.00% • Managing Department: Library • Comprehensive Plan: This project furthers policy C-14 • Potential BoardlCommission Review: ARB • Environmental: None • Design Elements: None • Operating: Ongoing maintenance and replacement costs • Telecommunications: None Other $275,000 $3,125,000 $1,600,000 $5,000,000 Revenues: Source of Funds: Capital Budget FY 2011 $275,000 $3,125,000 $1,600,000 $5,000,000 Grants from the Palo Alto Library Foundation or other donors and, if needed, Library Devel­ opment Impact Fees and Community Center Development Impact Fees City of Palo Alto