Report to Carson Reclamation Authority
Tuesday, June 06, 2017
Discussion
SUBJECT:
Title
CONSIDER PROPOSED FISCAL YEAR 2017-18 BUDGET FOR THE CARSON RECLAMATION AUTHORITY
Body
I. SUMMARY
The Joint Powers Agreement that authorized the formation of the Carson Reclamation Authority (CRA) on February 17, 2015 calls for the adoption of an annual budget by no less than 2/3 vote of the Board of Directors. This report transmits the proposed fiscal year 2017-18 (FY17-18) CRA budget. Proposed expenditures include those required to remediate the former Cal-Compact Landfill and support the horizontal and vertical development of the site.
II. RECOMMENDATION
Recommendation
Waive further reading and ADOPT RESOLUTION NO. 17-07-CRJPA, A RESOLUTION OF THE CARSON RECLAMATION JOINT POWERS AUTHORITY ADOPTING THE FISCAL YEAR 2017-18 BUDGET AND APPROVING APPROPRIATIONS FOR FISCAL YEAR 2017-18.
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III. ALTERNATIVES
1. MODIFY the proposed budget and APPROVE the budget as modified; or
2. TAKE another action deemed appropriate by the Board.
IV. BACKGROUND
History
On January 20, 2015, the governing boards of the Carson Housing Authority and the Community Facilities Districts each approved an agreement for the formation of the Carson Reclamation Joint Powers Authority (CRJPA) for the purpose of overseeing and facilitating the remediation of contaminated properties in the City of Carson and for the maintenance and potential development of same. The Carson Reclamation Authority was formed pursuant to the Joint Powers Agreement dated February 17, 2015, which was then amended on March 17, 2015.
Budget Required
The Joint Powers Agreement provides under Article II - Purpose and Powers, Section 2.03 - Specific Powers, Subsection (a) - Annual Budget, that the CRA Board shall adopt an annual budget for the ensuing fiscal year by approval of not less than 2/3 of the Board Members. The next fiscal year begins July 1, 2017 and ends June 30, 2018.
Financial Snapshot & Proposed FY17-18 Budget
The FY15-16 audited activity, the FY16-17 actual and expected resources and the expenditure budget, and the FY17-18 proposed budget follow.
Based on the Project Schedule negotiated with Macerich and the terms of the MOU, staff expects the CRA will begin to construct significant onsite and offsite improvements beginning February 2018, which will drive FY17-18 expenditures to more than $57 million. Approximately $31 million of these expenditures is to be reimbursed by developers. In addition, a grant of $1.8 million has been secured by a grant from METRO for offsite intersection improvements. While the City Treasurer is working with the investment advisor that provides the CRA with security, liquidity and return, as the CRA’s cash cannot be placed into higher yielding long-term investments, staff has assumed a 0.5% rate of return.
Proposed Professional Services expenditures include the SCS Engineers contract, SEG Advisors, Michael Baker, Greenberg Traurig, and the independent auditors. Project Improvements undertaken by RE|Solutions and its subcontractors will include grading and trash relocation; construction of remedial systems, including landfill gas wells, landfill liner and cap; building protection systems, piles, piles caps and structural slabs; and streets and utilities, including the filling in and construction of Lenardo Road. Offsite Improvements (off the CCLF site) will include intersection and other roadway improvements required as mitigation measures in the EIR.
In addition, the placement of the Development PLL and CPL policies will be several million dollars.
V. FISCAL IMPACT
If the CRA Board adopts the proposed resolution, the CRA will have the spending authority to proceed with onsite and offsite improvements as planned. The remaining spendable fund balance at June 30, 2018 is expected to be $68,295,442. Significant expenditures are expected to continue in FY18-19.
VI. EXHIBITS
RESOLUTION NO. 17-07-CRJPA, A RESOLUTION OF THE CARSON RECLAMATION JOINT POWERS AUTHORITY ADOPTING THE FISCAL YEAR 2017-18 BUDGET AND APPROVING APPROPRIATIONS FOR FISCAL YEAR 2017-18 (pages 5-6)
Prepared by: John Raymond, Community Development Director