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10/24/2016 02 2017 Preliminary Budget Overview
BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDASTATEMENT Item No. 2. For Meeting of: October 24, 2016 ITEM TITLE: Overview of preliminary 2017 Budget to include possible revenue options SUBMITTED BY: Cliff Moore, City Manager Cindy Epperson, Director of Finance & Budget SUMMARY EXPLANATION: 1. Overview of Preliminary 2017 Budget 2. Utility Rate Increases a) Water b) Wastewater /Stormwater c) Refuse 3. General Fund Fee Increases a) Planning, Zoning and Land Use Fees b) Special Event Permit Fees 4. New or Enhanced Revenue a) Lift (or remove) the cap on Electric, Natural Gas, and Telephone utility tax b) Brokered Natural Gas tax c) Transportation Benefit District 5. Review Sales Tax trends 6. 2017 Option for GFI/YPAL /Miller Park ITEM BUDGETED: STRATEGIC PRIORITY: APPROVED FOR SUBMITTAL: ~City Manager STAFF RECOMMENDATION: BOARD /COMMITTEE RECOMMENDATION: ATTACHMENTS: Description Upload Date Type D 1 Overview of Preliminary 2017 Budget 10121/2016 Cmer Memo D 2 Utility Rate Increases 1012012016 Coxer Memo D 2a Water Rate 10/21/2016 Coxer Memo D 2b Wastewater / Stammerer Rate 10121/2016 Backup Material D 2c Refuse Rate 10/21/2016 Backup Material D W Land Use Permit Fee Increases 1012012016 Ckwer Memo D 3b Special Event Permit Fee 10/2012016 Ca r Memo D 4a Lift the cap on utility tax 10120/2016 Coxer Memo D 4b Impose Brokered Natural Gas tx 10/2012016 Cover Memo D 4c Impose a TBD 10120/2016 Coxer Memo D 5 Review Sales Tax Trends 10/2012016 Coxer Merno D 6 CFI, YPAL, CDftey response 10121/2016 Wxer Memo PROPOSED 2017 BUDGET HIGHLIGHTS ➢ The proposed city -wide FY 2017 Preliminary Budget is balanced within available resources and prudent at $235.3 m. This represents a $28.1 m increase over projected 2016 year -end expenditure estimate. Of this increase, 83% is dedicated to capital improvements. The proposed General Government budget is $76.3 m. ➢ Budget is focused and responsive to: • City Council's Strategic Priorities • Economic Development • Public Safety • Partnership Development • Neighborhood & Community Building • Continue to enhance Public Trust and Accountability • Delivery of core services — Police, Fire, Public Works (i.e. Parks and Streets) — - These departments total 68.7% of General Government budget • Capital infrastructure and equipment investment -- $57.9 m, compares to $34.4 m 2016 estimate. Some projects carried over, some new. Represents almost 25% of the entire budget • The general operating property tax levy will increase by $0.0238 per thousand or 0.8% from the 2016 tax levy. Annual increase for $150,000 assessed value is $3.57 (Note: 2014 was the last debt service levy) • Rate increases as originally proposed in rate studies for water, wastewater, stormwater and refuse are being reduced in the 2017 Preliminary Budget. As a result, some water and stormwater capital projects would be postponed. Refuse and Wastewater capital reserve balances are still below recommended minimums • Typical Household (12 units of water, 96 gal refuse cart) would see a bi- monthly increase of $6.20 (or $3.10 per month) PROPOSED 2017 BUDGET HIGHLIGHTS ➢ Budget challenges include: • Tempered recovery from the Great Recession — "new normal" (IPD under 1% for the past 2 years) • Threats to utility tax base (consumers abandoning land lines, trend to data from voice, solar electricity, reduction in raw energy prices) • Personnel costs are paramount expenditure drivers - 69.6% of General Government budget (69.1% in 2016; 68.9% in 2015; 70.4% in 2014; 72.3% in 2013) • Managing past, present, and future health insurance and pension costs • City's aging infrastructure, utility systems, facilities, and rolling stock require increased investments ■ Long -term federal and state assistance is declining ➢ Budget balancing strategies include: ■ 2% payroll vacancy savings dropped to 1.2% -- from $1,085,000 to $675,000 (savings haven't materialized because of accrued leave cashouts, additional overtime, and medical fund pressure) ■ Elimination of 4 positions in General Government (about $345,000) ■ Fee increases for Fire Inspection, Zoning -Land use services ($300,000) ➢ This overview of the proposed budget is subject to change by Council direction 2017 PROPOSED BUDGET 2016 2017 16 vs. 17 Year -End Proposed Budget Estimate Expenditures % Change General Government $ 73,861,531 $ 76,300,253 3.3% Enterprise & Non - General Gov't 133,374,487 159,027,911 19.2% Total Proposed Budget $ 207,236,018 $ 235,328,165 13.6% 2017 PROPOSED BUDGET Summary of Proposed FY 2017 Budget (All Funds - numbers in millions) General Fund Parks and Recreation Street & Traffic Operations General Government Subtotal Utilities /Other Operating Capital Improvement Risk Management Reserves Employee Benefit Reserves Trust and Agency Funds G.O. Bond Debt Service Utility Revenue Bond Debt Service Total Estimated 2017 2017 Estimated 2017 Beg. Projected Proposed Use of 2017 Ending Fund Balance Revenue Expenditures Reserves Balance $5.8 $64.7 $65.4 ($0.7) $5.1 0.6 5.5 5.5 (0.0) 0.6 0.6 5.4 5.4 0.0 0.6 6.9 75.6 76.3 (0.7) 6.2 21.3 73.2 74.5 (1.3) 20.0 35.0 40.2 57.9 (17.6) 17.4 0.2 4.1 3.9 0.2 0.3 3.8 15.2 15.2 (0.0) 3.8 0.7 0.7 0.7 0.0 0.7 0.3 4.8 4.8 0.0 0.3 2.0 2.1 2.1 0.0 2.0 $70.2 $215.8 $235.3 ($19.5) $50.7 2017 PROPOSED EXPENDITURE BUDGET Utilities /Ott Operating $74.5 31.6% $235.3 Million Risk Management Reserves Trust and Agency Funds $0.7 .3 0 0 Street & Traffic Parks and Operations Recreation $5.4 $5.5 2.3% 2.3% 3ond Debt ervice $4.8 2.0% Revenue +t Service 2.1 0 it Fund 5.4 8 % 2017 GENERAL GOVERNMENT EXPENDITURES BY DEPARTMENT Municipal Court $1,531,046 $ 2.0% Legg $1,720,714 Human 2.3% Resources $699,137 0.9% City Management $6,531,685 8.6% $76.3 Million Community Development Engineering Transfers $3,126,116 $783,620 $4,942,414 4.1% o / 1.0 /� MIJWAM Public Works $10,872,986 14.3% Police $28,769,117 37.7% 2017 GENERAL GOVERNMENT REVENUE &RESERVES $82.5 Million Source 2015 Actual 2016 Year -End Estimate Percent Change 2017 Projected Revenue % of 2017 Total -- 2017 vs. 2016 -- Increase Percent (Decrease) Change General Sales Tax $15.8 $16.4 4.0% $17.0 22.7% $0.6 3.8% Crim. Justice Sales Tax 3.3 3.4 3.1% 3.5 4.5% 0.1 4.0% Property Tax 16.4 16.8 1.9% 17.1 22.6% 0.3 1.9% Utility & Franchise Taxes 15.7 16.0 1.8% 16.5 21.8% 0.5 3.3% Charges for Services 8.2 8.8 6.7% 9.6 12.7% 0.8 8.9% State Shared Revenue 2.9 3.4 18.4% 3.4 4.5% 0.0 0.9% Fines and Forfeitures 1.6 1.7 6.3% 1.7 2.3% 0.0 1.8% Other Taxes 1.6 1.6 (0.2 %) 1.6 2.1% 0.0 0.9% Other Revenue 0.9 1.5 64.9% 1.2 1.6% (0.3) (20.4 %) Transfers from other Funds 1.4 1.5 2.8% 1.5 2.0% 0.0 1.5% Other Intergovernmental 1.6 1.7 7.5% 1.5 1.9% (0.2) (13.6 %) Licenses and Permits 0.9 1.0 13.6% 1.0 1.3% 0.0 (1.0 %) Total Revenue 70.3 73.7 4.8% 75.6 100.0% 1.9 2.5% Beginning Fund Balance 9.4 7.2 (24.0 %) 6.9 (0.2) (2.9 %) Total Resources $79.7 $80.8 1.4% $82.5 $1.7 2.1% 2017 GENERAL GOVERNMENT EXPENDITURES BY CLASSIFICATION Salaries & Benefits $53,506,890 70.1% $76.3 Million Operating Supplies $2,533,321 3.3% Intergov't Services $2,007,383 2.6% $3,797,110 5.0% Capital Outlay $82,000 0.1% GENERAL GOVERNMENT USAGE AND BALANCE COMPARISONS Beginning Reserve Balance Revenue Total Resources Expenditure Budget End. Reserve Balance % of Annual Expenditures 2015 Actual $ 9,412,400 70,265,428 $79,677,827 71 r�lr� nnr) $ 7,152,826 9.9% Inc /(Dec) in Reserves f/ Prior Year $ (2,259,574) % of Expenditure Budget (3.1 %) 2016 Amended Budget $ 7,152,826 73,273,325 $ 80,426,151 2016 Year-End Estimate $ 7,152,826 73,651,685 $ 80,804,511 72 7tin FFn 72 Q1ti1 F21 $ 7,165,601 $ 6,942,980 9.8% 9.4% $ 12,775 $ (209,846) 0.0% (0.3 %) 2017 Proposed Variance Expenditure (4 -2) $ 6,942,980 75,578,814 $82,521,794 $ 2,095,643 76,300,253 3,039,703 $ 6,221,541 8.2% $ (721,439) (0.9 %) GENERAL GOVERNMENT FUND BALANCE ➢ 2017 Maintenance budget drops Fund Balance by $721,000 from $6.9 m to $6.2 m — 8.2% of budget expenditures ➢ Fund Balance target is 16.7% of budgeted expenditures or $12.7 m — Preliminary Budget is about half of target ➢ Fund Balance is important for emergencies, cash flow, revenue short falls, one -time opportunities, matching grants, and to preserve bond rating ➢ Fund Balance can be restored by: • Expenditure reductions • Revenue increases • Or a combination of these two ➢ General Government budget reduction options of $885,000 identified (not budgeted) ➢ New revenues being considered: • Lift lid on electric, natural gas, and telephone utility tax • Impose Brokered Natural Gas Utility Tax • Establish a Transportation Benefit District • Original proposal for increase in utility rates GENERAL GOVERNMENT BUDGET OVERVIEW ➢ Major Budget Balancing Strategy ■ 1.2% Vacancy rate $675,000 ■ Eliminated 5 positions (4 Full Time Employee [FTE] funded by General Government [GG]) 480,000 ■ Reduced Temporary Salary 66,000 ➢ Revenue Assumptions ■ Proposed 1% inflation adjustment in property taxes plus an estimate of $416,000 1.3% new construction (Because this year's implicit price deflator is only 0.953% a super majority (5 — 2) vote and a declaration of "substantial need" would be required to pass a 1% increase.) ■ 3.8% growth in sales tax 640,000 (2012 - 2014 growth above 6.0% - 2015 2.9 %, 2016 est. 4.0 %) ■ Utility tax growth of 3.3% 456,000 ■ Sale of two Tiger Mart locations (down from $688k in 2016) 400,000 ■ Imposition of Fire Inspection Fee, Increase Zoning Fees 300,000 ■ Other charges for service (City Service, Utility Billing) 439,000 ➢ Cost Drivers • Cost of living payroll increase (avg. 2.5 %) — CPI running under 1% $950,000 • Pension rate increase (2.0% 7/1/17) 175,000 • Medical rate increase 15% (about half mid — 2016) 930,000 CITY COUNCIL STRATEGIC PRIORITIES Public Safety Investments BUDGETED ➢ Police Online Reporting System ($49,000) ➢ Police & Legal Center Reconfiguration ($60,000) ➢ Police Fleet Additions /Replacement ($400,000) ➢ Fire Apparatus (Carryover — $1,500,000) ➢ Add Fire Inspection Fee (Revenue - $250,000) ➢ Add One Public Safety Communications Supervisor (Increase $90,200) UNBUDGETED ➢ Fire Station Facilities Remodel & Modernization ($700,000) ➢ Add One Fire Maintenance Mechanic ($99,000) ➢ Add 3 Firefighter Positions ($279,000) ➢ Refurbish Communication Vehicle ($12,000) ➢ Energy Conservation Street Lighting ($2,100,000) CITY COUNCIL STRATEGIC PRIORITIES Public Safety Investments (Utilities) BUDGETED ➢ Wastewater Capital Investments ($12,825,000) Speedway Lift Station, Primary Digester Improvements, Prioritized Collections Maintenance, Activated Sludge Clarifier, Collections Building Retrofit, Biogas Conditioning, Replace Variable Frequency Drives, Carriage Hill Lift Station, Disinfection Lamps, Sharples Centrifuge, Congdon Trunk Line ➢ Wastewater Rate Increase ➢ Add one Pretreatment Crew Leader position ($85,000) ➢ Water Capital Investment ($1,444,000) Modification to River Intake, Water Main Replacement, Updates & Maintenance ➢ Water Rate Increase ➢ Irrigation Capital Investment ($8,000,000 - $6,000,000 Revenue Bond) Nelson Dam ➢ Stormwater Capital Investments ($3,900,000) N. 1St Street Revitalization, Flood Hazard Reduction, DID Realignment ➢ Refuse Rate Increase CITY COUNCIL STRATEGIC PRIORITIES Economic Development Investments BUDGETED ➢ Economic Development Community Support ($318,333) 4th of July Committee, Yakima Arts Commission, Downtown Association of Yakima (tax credit revenue of $100,000), Craft Beverage, Airport Marketing (grant revenue $50,000) ➢ Public Market /Public Incubator Location Evaluation ($66,667 — Grant revenue of $50,000) ➢ Downtown Plaza ($10,817,000 / $2,842,000 community donation, $7,975,000 G.O. Bond, Debt Service from REST 2 and pledges.) ➢ Cascade Mill Site ($1,200,000 / LIFT) ➢ Transit Capital ($2,215,000) Transit Buses — 2016 carryover ($1,885,000), ADA Sidewalk Improvements,10 Solar Shelters, and replace 3 Administrative Vehicles ➢ Transit Operating ($190,000) Upgrade Camera, 25 Passenger Counters, Transit Marketing UNBUDGETED ➢ Special Event Fee Increase ($9,550 in revenue) ➢ Add One Airport Assistant Manager Position ($102,400) CITY COUNCIL STRATEGIC PRIORITIES Neighborhood & Community Building BUDGETED ➢ City Hall Facility Projects ($1,292,000 funded by REST 1) Elevator 1 and elevator 2 upgrades, and carryforward ➢ Airport Capital Improvements ($1,950,000 - $1,755,000 grant revenue /$195,000 in PFC) Security perimeter fence, snow removal equipment, west general aviation apron, east apron and taxiway crack sealing ➢ Arterial Street Capital Improvements ($4,516,100) Grants - $2.3m, LTGO - $1.7m SOZO street improvements, north side alley pavers, Adam /Washington sidewalks, Powerhouse Road sidewalks ➢ Equipment Rental Shop Equipment ($88,000) ➢ Replace Fuel Management System ($175,000) Environmental Fund ➢ Parks Capital Improvements ($2,031,000) SOZO land purchase, Randall and other park improvements UNBUDGETED ➢ Sidewalk Repair /Installation & Tree Removal ($50,000) CITY COUNCIL STRATEGIC PRIORITIES Partnership Development Investments BUDGETED ➢ Capitol Theatre Management Fee (Additional $5,640 — 2017: Total Budget $287,640) CITY COUNCIL STRATEGIC PRIORITIES Public Trust & Accountability BUDGETED ➢ Change position from 50% DA -III to 100% City Records Assistant ($10,800) ➢ Replace Telephone Tech position with Telecommunications Analyst ($9,500) ➢ Reallocation of Purchasing Assistant ($38,000 transferred to Risk Mgmt) ➢ Land Development Fee Increase (Revenue - $50,000) ➢ Fleet Vehicle Additions /Replacement in Equipment Rental Fund ($1,536,000) UNBUDGETED ➢ Human Resources - Add 2 NEOGov Software Modules ($39,200) ➢ Financial Services - Workiva Reporting Software ($29,000) ➢ Add Two Traffic Signs & Marking Specialists ($120,000) ➢ Add One Traffic Technician position ($55,000) ➢ Engineering to Purchase full size copier /scanner ($18,000) 2017 TOP 10 CAPITAL PROJECTS (66.9% of total Capital Funds, $57,867,959) Yakima Central Plaza Irrigation - Irrigation system /Nelson Dam Wastewater - Speedway Lift Station Streets - Spring Creek /36th Ave /Sorenson (SOZO) Wastewater - Primary Digester Improvements Transit - 4 Transit Buses (carryover) Stormwater - N 1st St Revitalization (carryover) Fire Apparatus (carryover) Comm Development - Cascade Mill Redevelopment Airport - Snow Removal Equipment 2017 Proposed Expenditures Funding Source $ 10,817,000 REET 2 /LTGO Bonds /Donations 8,000,000 $6M Bonds 7,000,000 Capital Rates /Reserves 2,970,000 SIED Grant /Loan, GO Bonds 2,500,000 Capital Rates /Reserves 1,885,000 Capital Reserves /WSDOT Grant 1,790,000 Capital Rates /Reserves 1,500,000 State LOCAL /Capital Lease 1,200,000 Local Infrastructure Finance Tool (LIFT) 1,040,000 90% Grants 10% Passenger Facility Charge $ 38,702,000 FY 2017 BUDGET SUMMARY ➢ Balanced budget ➢ Focus on core services and Strategic Priorities ➢ Infrastructure investments of $57.9 million for Plaza, Utilities, Airport, Street Improvements, including SOZO access, Transit Buses, Fire Suppression Equipment, and Public Works Equipment ➢ Slight Property Tax increase: General Operating Tax Levy of $0.0238 or 0.8% from $3.0879 to $3.117 per thousand of Assessed Value ➢ General Government fund balance is still a concern ■ TO: Honorable Mayor, Members of the City Council, and Cliff Moore, City Manager FROM: Scott Schafer, Director of Public Work\s-k SUBJECT: Proposed Utility Rate Increases &Y -TM- Outcome: The identified $1.4 million in capital projects would also be completed in 2017. However, under this scenario, requires utilizing reserves and transferring less to capital improvement projects. rly.ro re • * Maintain $1 million minimum reserve within Water Capital Fund 0 $1 million scheduled for water main replacement as part of the North 1 s' Street Renovation Project RRMM- 2017 — 3.0% rate increase (additional $577,000 revenue and $161,500 In Lieu Tax/year) 2018 — 3.0% rate increase • Primary Digester Improvements $2,500,000 • Activated Sludge Clarifier Improvements $750,000 • Digester Biogas Conditioning $300,000 • Rudkin Rd. Lift Station VFD Replacement $200,000 I Al W 0,111, M- 0 2017 - 1.5% rate increase (additional $324,000 revenue and $89,700 In Lieu Tax/year) 2018 - 2.0% rate increase er, Inuer frus Suenano, 111A De req, projects. 0 Maintain $1 million minimum reserve within Wastewater Capital Funds 0 On a limited basis, address the facility's aging infrastructure projects. Many ha been delayed for 2 to 3 years as a directive from the previous administration. I RJKI��M 11MR11MR1 111MIMP ill, I North ls' Street Revitalization Project $1,790,000 Flood Hazard Reduction $1,000,000 Drainage Improvement District Integration $950,000 Cascade Mill Site Project $160,000 In addition: 0 Could allow a public outreach & education program to begin for recycling. * As early as 2020, could begin implementing a phased-in City recycling program that could include curbside garbage, yard waste, and recycling at a bundled rate. * Continue with addressing the aging infrastructure of both truck and cart replacement. Alternative Rate Increase: • Impacts the aging infrastructure and the replacement of trucks and carts; increases maintenance costs. • Further delays the possibility of providing curbside recycling to residents; which could include offering curbside garbage, yard waste, and recycling at a bundled rate. City of Yakima Proposed Utility Bill Paid by a Typical Household BUDGETED ALTERNATIVE Cost per billing cycle: Water 2 Month Ready to serve 12 units - Wastewater 2 Month Ready to serve 12 units - Refuse 2 Month 32 gal. Cart 2 Month 96 gal. Cart Stormwater 2 Month Ready to serve Total Bi- monthly bill Increase $ 17.54 $ 18.42 $ 19.28 $ 20.15 $ 21.10 Lp JJ.VV Lp JV.01 Lp JO.J`f L ±V./-O L ±/-.1/ $ 41.24 $ 41.86 $ 42.70 $ 43.76 $ 45.16 �p / /.JV �p /V.JL �p VV.VI �p VL.VI �p VY. /G $ 32.04 $ 33.23 $ 34.26 $ 35.28 $ 36.34 $ 36.64 $ 38.00 $ 39.17 $ 40.35 $ 41.56 $ 7.16 $ 9.09 $ 10.82 $ 12.12 $ 12.60 $ 6.20 $ 6.21 $ 6.21 $ 6.22 Monthly billing charge $ 78.11 $ 81.21 $ 84.31 $ 87.42 $ 90.53 Monthly Increase $ 3.10 $ 3.10 $ 3.11 $ 3.11 Assumptions: Water & Wastewater - Average family usage of water per billing cycle 12 Stormwater - 1 ERU, Equivalent Residential Unit of impervious surface Refuse - 96 gal. Cart \ \yakima _city \ykfn \Users \rdukart \City Council \2016 \10 -24 Council Study Session \2a Utiity Rates - Budgeted Alternative.xlsx City of Yakima Proposed Utility Bill Paid by a Typical Household Original - presented at the 9/27 Roundtable Cost per billing cycle: Monthly billing charge $ 78.11 $ 2016 $ 2017 $ 2018 Monthly Increase 2020 Water $ 3.54 $ 2.57 2 Month Ready to serve $ 17.54 $ 19.03 $ 20.64 $ 20.64 12 units - 17.52 19.05 20.88 20.88 $ 35.06 $ 38.08 $ 41.52 $ 41.52 Wastewater 2 Month Ready to serve $ 41.24 $ 42.46 $ 43.74 $ 46.40 12 units - 36.12 37.20 38.28 40.68 $ 77.36 $ 79.66 $ 82.02 $ 87.08 Refuse 2 Month 32 gal. Cart $ 32.04 $ 34.30 $ 35.20 $ 37.00 2 Month 96 gal. Cart $ 36.64 $ 39.20 $ 40.20 $ 43.50 Stormwater 2 Month Ready to serve $ 7.16 $ 11.68 $ 11.96 $ 12.56 Total Bi- monthly bill $ 156.22 $ 168.62 $ 175.70 $ 184.66 Increase $ 12.40 $ 7.08 $ 5.14 Monthly billing charge $ 78.11 $ 84.31 $ 87.85 $ 92.33 Monthly Increase $ 6.20 $ 3.54 $ 2.57 Assumptions: Water & Wastewater - Average family usage of water per billing cycle 12 Stormwater - 1 ERU, Equivalent Residential Unit of impervious surface Refuse - 96 gal. Cart \ \yakima _city \ykfn \Users \rdukart \City Council \2016 \10 -24 Council Study Session \2a Utiity Rates - Budgeted Alternative.xlsx UTILITIES & ENGINEERING / WATER 2017 STRATEGIC INITIATIVE WATER RATE INCREASE BUDGETED / UNBUDGETED PROPOSAL The Water Rate Study for the years 2013 to 2017 was conducted. The full study is available for your reference. This is the third multiyear Water Rate Study the City has conducted. The City adopted the process of conducting five year rate studies in 1996 to help stabilize rates, keep rate increases as low as possible, keep necessary increases as even as possible and in insure adequate funding for operations and capital improvements. The Capital Improvement Program is adopted by City Council through the six -year Water System Plan and is incorporated within this study. The Rate Study that was completed in the fall of 2012 proposed three 9% and two 3 1/2% increases over the following five years. The study was tabled while further review of the capital improvement needs and costs could be completed. No rate increase was implemented in 2013. A new study reflecting the true costs for the capital program was conducted in the spring 2013. This updated study, attached, proposed a 4% revenue increase in each year starting in 2014 and ending in 2018. No rate increases were implemented in 2014. The 2013 study update, executive summary attached (full study available for your reference), did a closer analysis which shows that the utility can choose not to implement the indicated 4% increase, taking no increase at all in 2014 and still maintain at least a 60 day operating reserve as well as proceed with the planned capital improvement program until 2016. In 2017 and beyond, it is estimated that the operating reserve will drop below 60 days. However, it is anticipated that currently unquantifiable increased revenue as a result of the automated meter reading program and efficiencies in capital projects along with other cost saving efforts will result in higher operating reserves in 2017 and 2018 than current forecast. Some revenue did increase but was not sufficient without a rate increase and some capital improvements were delayed again. There are a number of solutions including reducing transfers from the operating to capital fund, further delaying certain capital projects and /or increasing the 2017 -2018 rates. Water sales are down and have been for several years due to the economic downturn and people using less water through conservation. The study points out that Yakima is a bit lower in the fixed charges (Ready -to- Serve) than the national average of 30 %, currently we are at 22% fixed charge. Because of the lower volume of water sales we raised our fixed charge to 27% of the revenue and lowered the volume rate from $1.51 to $1.46 per 100 cubic feet of water in 2014. No additional revenue was to be generated however some users saw a slight increase in their utility bill or a slight decrease. No rate increases were implemented in 2013 through 2016. Four years of planned increases were delayed. To recover some of the losses from not implementing rate increases as planned in the 2013 Rate Study Update, it is proposed to increase rates by 8.5% in 2017 and 2018. Transfers to capital improvements will be reduced by $250,000 a year in 2017 and 2018. This leaves us just under the 60 days required operating reserve. Connection charges were first implemented in 1998 and have not been increased from inception. These charges are outdated and do not reflect the true cost of connection and should be increased per the study. The study includes a benchmarking analysis available for your reference. The benchmarking analysis was conducted for two purposes, to look for deficiencies and to help find areas where we might improve efficiency to reduce costs. The study indicated two areas where we are below industry standards, training and water loss. The training budget has been increased along with improved tracking of training. The water loss should improve with the new meters in the automated meter reading program as it is probable that the system is not losing water, but rather our old meters were not accurately measuring all of it. IMPACTS 1. Fiscal Impact - ➢ Revenue increase in 2017 of $730,201 ➢ Revenue increase in 2018 of $794,249 2. Proposed Funding Source - Water customers. Each year rates will be analyzed during the budget preparation to determine if the proposed rate increase is warranted. ➢ 8.5% increase in 2017, and raise the fixed charges (Ready -to- Serve) from 27% of revenue to 30% of revenue (this will not increase to overall revenue but help to stabilize the revenue) ➢ 8.5% increase in 2018 3. Public Impact - Average residential water customer using 12 units of water would have an increase of $3.02 every two months or $1.51 per month in 2017 and $3.22 every two months or $1.61 every month in 2018. 4. Personnel Impact - None. 5. Required Changes in City Regulations or Policies - Will require an ordinance and public hearing (can be conducted with Budget Public Hearing) to change rates. 6. Legal Constraints, if applicable - None. 7. Viable Alternatives - (Budgeted) Increase 2017 by 5.0 %, generates $425,000 and 5% 2018, generates $446,250. Complete a Water Rate and Cost of Service Study in late 2017 or early 2018 after the 2017 Water System Plan is adopted. a) Public Impact - Average residential water customer using 12 units of water would have an increase of $1.79 every two months or $0.90 per month in 2017 and $2.01 every two months or $1.00 every month in 2018. b) Projects deferred - Transfer to Capital $675,000 in 2017 and reduce transfer to $400,000 in 2018 (reduces dependence on operating reserve) The 2011 Water System Plan and the 2013 Water Rate Study had about $2,000,000 per year for ageing infrastructure replacement (old cast iron water mains). Rate increases planned each year from 2013 to 2018 were suspended for years 2013 to 2016. This caused the ageing infrastructure replacement projects to be cancelled. No ageing infrastructure project is planned for 2017, causing the utility to be behind four years in replacements. In 2018 the N. 1St Street Main Replacement project is scheduled. Up to $2,000,000 in ageing infrastructure replacement should be scheduled in 2019 keeping the minimum reserve of $1,000,000. UTILITIES & ENGINEERING / WASTEWATER 2017 STRATEGIC INITIATIVE WASTEWATER RATE INCREASE BUDGETED / UNBUDGETED PROPOSAL This Strategic Initiative adopts the wastewater and stormwater rate recommendations from the 2014 Wastewater, Industrial Wastewater and Stormwater Rate Study (FCS Group, 2014). The adoption of the recommended stormwater rates is necessary to fund the $2.5 million average annual stormwater capital expenditure over the next ten years as identified in the 2013 Stormwater System Collection Master Plan (Akel, 2013). Adoption of the recommended wastewater rates is necessary to end residential customer subsidy of high- impact customers enrolled in the Pretreatment Program. The wastewater utility operates and maintains the Pretreatment Program in order to perform Federally - mandated monitoring, including wastewater sampling and facility inspection, of over 500 Yakima commercial and industrial wastewater customers. The Pretreatment Program is primarily funded through a monthly Pretreatment charge to monitored customers and through strong waste charges that should offset Pretreatment Program expenses. However, the utility is under - recovering the cost of the Pretreatment Program by about $220,000 per year. A prior Rate Study recognized this under- recovery and recommended a rate structure that would fully fund the Pretreatment program. However, the recommended structure was only partially adopted, leading to a continuation of the under- recovery and subsidy from residential customers. Adoption of the recommended wastewater rate schedules would establish full Pretreatment Program cost recovery within 3 years, consequently ending residential ratepayer subsidy of high- impact customers and limiting residential rate increases to 3% annually. Finally, adoption of the recommended Industrial Waste Line customer rate structure would establish assessments that reflect the cost of pre - treating industrial wastewater in the Yakima Wastewater Treatment Plant's new high -rate anaerobic digester (UASB). $60.0 $50.0 To $40.0 $30.0 $20.0 $10.0 $0.0 Monthly Wastewater /Stormwater Charges for Typical Single Family Customer T�i_1 Q`A C 7 Total U. 7_n Total $48.4 Total $49.8 Total $51.3 2016 2017 2018 2019 2020 2021 iiiillillillilliStormwater iiiiiiiiiiiiiiiiWastewater Total Bi- Montmy wastewater ana Stormwater cnarge companson Current 2016 Rates Proposed 2017 Rates Annual Increase Monthly Charge Comparison Stormwater Wastewater Total Stormwater Wastewater Total Total Single Family Customer $7.16 $77.36 $84.52 $11.68 $79.68 $91.36 $41.04 (314" meter, 6 ccf /mo, 1 Storm ERU) Multi Family Residential $28.66 $189.56 $218.22 $46.72 $195.24 $241.96 $142.44 (5 ccf /mo /unit, 10 Multi- Units, 4 Storm ERUs) Minor Industrial User $50.16 $367.28 $417.44 $81.76 $389.88 $471.64 $325.20 (1 "Meter, 35 ccf /mo, 7Storm ERUs, 90lbs/mo Strong Waste BOD) IMPACTS 1. Fiscal Impact - Provides revenue to recover Pretreatment Program costs, maintain minimum operating reserves and debt coverage for Wastewater and Stormwater. Prog am Stormwater Wastewater Retail Wastewater BOD Wastewater TSS Wastewater FOG 2017 $2.30 per ERU 3% 16% 7% 35% 2018 -2021 2.5% annually 3.0% annually 2.4% annually 2.4% annually 2.4% annually 2017 Ind Waste / UASB $7.69 per hundred cubic feet of discharge, plus 60% of the retail Ready -to -Serve charge, plus 60% of the retail volume rate, plus 100% of the Strong Waste Charges applied to the UASB effluent wastewater strength 2017 -2019 2020 -2021 Wastewater Pretreat 18% 4.5% annually 2. Proposed Funding Source — Revenue is collected through Utility Billing and will be paid by Wastewater and Stormwater customers residing within the city limits. Public Impact — Stormwater and wastewater customers will see an increase in their utility costs. The combined monthly single family wastewater and stormwater charge increases 8% from $42.26 in 2016 to $45.68 in 2017, with 2.9% annual increases from 2018 through 2021. 4. Personnel Impact — None. 5. Required Changes in City Regulations or Policies — Amendments to the applicable City Municipal Code will be required. 6. Legal Constraints, if applicable — None. 7. Viable Alternatives — Future capital program projects will not be completed. Postponing infrastructure projects may result in higher project costs in the future or require emergency action by the agency to address operational failures. UTILITIES & ENGINEERING / WASTEWATER 2017 STRATEGIC INITIATIVE WASTEWATER RATE INCREASE - ALTERNATIVE UNBUDGETED PROPOSAL At their roundtable discussion on September 27, 2016, Council indicated that they support utility rate increases to keep the utilities viable, however, their preference was to have the total of all the increases be about half of the proposals for the typical household. With that direction in mind, staff revisited the rate increases, and are modifying the Wastewater fee to increase by 1.5% (from 3.0 %), and Stormwater by 27% (from 63 %). The increases in the Pretreatment rates and the changes in charges to Industrial Waste Line customers are unchanged from the original proposal. Monthly Wastewater /StormwaterCharges for Typical Single Family Customer $60.00 $50.00 Total $45.46 Total $47.11 Total $48.66 Total $42.26 Total $43.81 $40.00 $30.00 $38.68 $39.26 $40.05 $41.05 $42.36 $20.00 $10.00 $0.00 $3.58 $4.55 $5.41 $6.06 $6.30 2016 2017 2018 2019 2020 Stormwater Wastewater Total Bi- Monthly Wastewater and Stormwater Charge Comparison Current 2016 Rates Customer Type Stormwater Wastewater Total Proposed 2017 Rates Stormwater Wastewater Total Annual Increase Total Single Family Customer $7.16 $77.36 $84.52 $9.09 $78.52 $87.61 $18.54 (3l4" meter, 6ccflmo, 1 storm ER U) Multi Family Residential $28.66 $189.56 $218.22 $36.36 $192.40 $228.76 $126.48 (5ccflmolunit, 10 Multi - Units, 4 StormERUs) Minor Industrial User $50.16 $533.40 $583.56 $63.63 $584.68 $648.31 $388.5 (1 "meter, 35 ccflmo, 7 Storm ERUs, 90 lbslmo Strong Waste BOD, SPT Charge) IMPACTS 1. Fiscal Impact - Provides revenue to recover Pretreatment Program costs, maintain minimum operating reserves and debt coverage for Wastewater and Stormwater. Progf am 2017 2018 -2021 Stormwater $0.97 per ERU 11.7% average annually Wastewater Retail 1.5% 2.6% average annually Wastewater BOD 16% 2.4% annually Wastewater TSS 7% 2.4% annually Wastewater FOG 35% 2.4% annually 2017 Ind Waste / UASB $7.69 per hundred cubic feet of discharge, plus 60% of the retail Ready -to -Serve charge, plus 60% of the retail volume rate, plus 100% of the Strong Waste Charges applied to the UASB effluent wastewater strength 2017 -2019 2020 -2021 Wastewater Pretreat 18% 4.5% annually 2. Proposed Funding Source - Revenue is collected through Utility Billing and will be paid by Wastewater and Stormwater customers residing within the city limits. 3. Public Impact - Stormwater and wastewater customers will see an increase in their utility costs. The combined monthly single family wastewater and stormwater charge increases 3.7% from $42.26 in 2016 to $43.81 in 2017, with 3.6% annual increases from 2018 through 2020. 4. Personnel Impact - None. 5. Required Changes in City Regulations or Policies - Amendments to the applicable City Municipal Code will be required. 6. Legal Constraints, if applicable - None. 7. Viable Alternatives - Future capital program projects will not be completed. Postponing infrastructure projects may result in higher project costs in the future or require emergency action by the agency to address operational failures. PUBLIC WORKS / REFUSE 2017 STRATEGIC INITIATIVE PASS - THROUGH RATE INCREASE /YAKIMA COUNTY TIPPING FEES - 7% BUDGETED / UNBUDGETED PROPOSAL This initiative proposes a 7.0% rate increase in Refuse rates for 2017 for expenses relating to anticipated increases in Yakima County's landfill tipping fees and other operational costs effective January 1, 2017. The following table summarizes the expected cost increases for residents with a 96 gallon cart - there are 18,626 customers (72 %) that have a 96 gallon cart for waste collection and 7,370 customers (28 %) that have a 32 gallon cart for collection. Residents with a 32 gallon cart will also incur a 7% increase of $1.13. Cost Component 2016 2017 $♦ %A Labor Cost $2.76 $2.87 $0.12 4.3% Collection Operations $4.70 $4.87 $0.17 3.5% Disposal $3.46 $3.90 $0.44 12.7% Customer Service $0.63 $0.63 $0.00 0.0% Management & Administration $0.90 $1.10 $0.20 22.3% Public Works & Billing and Finance Allocation $1.01 $1.04 $0.03 2.5% Utility Tax / WA Refuse Tax $3.32 $3.64 $0.33 9.9% Fund Reserve $1.55 $1.55 $- 0.0% Total Rate $18.32 $19.60 $1.28 7.0% City of Yakima Solid Waste and Recycling Division (SWRD) makes every effort to excel in quality solid waste management for the 93,000 residents of Yakima. The core business of SWRD is to provide weekly curbside residential garbage and yard waste service to approximately 26,000 residential customers who generate an average of 35,000 tons of waste per year. As part of the Interlocal Agreement with Yakima County, the City of Yakima utilizes the county's Terrace Heights Landfill to dispose of its waste. Yakima County Public Services Solid Waste Division has advised the City that they have completed a rate study for their current and future needs of their landfill. The proposed solid waste disposal rates for 2017 will increase approximately 13% over the 2016 rates. The proposed rates will cover the operational expenses, closure /post closure and capital costs for the Yakima County landfills. Yakima Utility Tax and Washington Refuse Tax will increase proportionately to the rate increase because both taxes are calculated on the assessed collection rate. The combined taxes comprise 18.6% of the total rate charged to the residential rate payers; the utility tax is 15% and the refuse tax is 3.6 %. The impact of these two fees is $0.33 per month for the customers with a 96 gallon cart. Labor and operational costs will increase due to the City's labor agreement, increases in employee health insurance, outside repair and maintenance cost for the collection fleet, and general liability insurance. The proposed rate increase included the addition of a Solid Waste Supervisor to its Division to accommodate past growth in service areas and integration of the new Cayenta utility billing, electronic routing and mobile management systems. The addition of a Solid Waste Supervisor allows for the current supervisor to address daily operation duties such as customer service issues, complaints, solid waste violations, safety issues, accident follow ups, address illegal clean ups, fleet maintenance issues and supervision of the maintenance workers. The new supervisor position will address the electronic routing implementation, on -going maintenance of the system and supervision of route drivers. The rate impact from the hiring of the SW Supervisor is $0.22 per residential customer per month in 2017; however, the cost per customer is expected to decrease in 2018 with the full implementation of the electronic routing and mobile management system. Rate increases in 2018 and 2019 are projected at 3.6% and 3.5% respectively; however, the collection efficiencies are expected to reduce costs by 1% in 2018 and 2019. In other words, the cost of the SW Supervisor in 2017 will be offset by the system savings of $0.21 per customer. Savings in 2018 is estimated at $0.22 and beyond. The rate impact for the 96 gallon customer over the next four years are summarized in the following table. Proposed Residential Rates for 2017 through 2019. Year 2016 2017 2018 2019 2020 96 gallon rate $18.32 $19.60 $20.10 $20.60 $21.10 $ Increase $16.02 $1.28 $0.50 $0.50 $0.50 % Increase $14.90 7.0% 2.6% 2.5% 2.5% Proposed Residential Rates for 2017 through 2019. Year 2016 2017 2018 2019 2020 96 gallon rate - Solid Waste $18.32 $19.60 $20.10 $20.60 $21.10 32 gallon rate - Solid Waste $16.02 $17.15 $17.60 $18.05 $18.50 96 gallon rate - Yard Waste $14.90 $15.95 $16.35 $16.75 $17.15 96 gallon rate - 2nd Yard Waste $7.40 $7.90 $8.10 $8.40 $8.60 Extra Can $4.23 $4.50 $4.60 $4.70 $4.80 Extra Bag $2.51 $2.70 $2.75 $2.80 $2.85 The following table details the proposed increase for container services for 2017. The increase is 7% over the current collection rates. Current 2016 Rates Container Size Col. Frequency 2 YD 4 YD 6 YD 1 $21.53 $34.28 $47.04 2 $34.54 $59.70 $85.56 3 $47.55 $85.12 $124.08 4 $60.56 $110.54 $162.60 5 $73.57 $135.96 $201.12 Proposed 2017 Rates Container Size Col. Frequency 2 YD 4 YD 6 YD 1 $23.04 $36.68 $50.33 2 $36.96 $63.88 $91.55 3 $50.88 $91.08 $132.77 4 $64.80 $118.28 $173.98 5 $78.72 $145.48 $215.20 IMPACTS Fiscal Impact - The proposed 2017 Yakima County landfill tipping fee will be an additional yearly cost of $134,000 to the City. The remaining cost increase are comprised of labor and operational costs of approximately $299,000. The overall fiscal impact to the Refuse Division is $433,000. Projected cost increases in 2018 and 2019 are approximately $170,000 each year. 2. Proposed Funding Source - Rate increase of 7% for all refuse collection rates in 2017. Proposed rate increases in 2018 through 2020 are 2.5% of the prior year's collection rate. 3. Public Impact - This initiative will impact the public though a pass through rate increase to cover the increased cost of landfill disposal. 4. Personnel Impact - None. 5. Required Changes in City Regulations or Policies - City ordinance revising the Refuse rate schedule will be required. 6. Legal Constraints, if applicable - None. 7. Viable Alternatives - None. PUBLIC WORKS / REFUSE 2017 STRATEGIC INITIATIVE PASS - THROUGH RATE INCREASE /YAKIMA COUNTY TIPPING FEES - 3.7% BUDGETED / UNBUDGETED PROPOSAL This initiative proposes a 3.7% rate increase in Refuse rates for 2017 for expenses relating to anticipated increases in Yakima County's landfill tipping fees and other operational costs effective January 1, 2017. The following table summarizes the expected cost increases for residents with a 96 gallon cart - there are 18,626 customers (72 %) that have a 96 gallon cart for waste collection and 7,370 customers (28 %) that have a 32 gallon cart for collection. Residents with a 32 gallon cart will also incur a 7% increase of $1.13. Cost Component 2016 2017 $♦ %A Labor Cost $2.76 $2.88 $0.13 4.5% Collection Operations $4.70 $4.77 $0.07 1.5% Disposal $3.46 $3.90 $0.44 12.7% Customer Service $0.63 $0.75 $0.13 20.2% Management & Administration $0.90 $1.08 $0.18 20.2% Public Works & Billing and Finance Allocation $1.01 $1.12 $0.11 11.0% Utility Tax / WA Refuse Tax $3.08 $3.19 $0.11 3.7% Fund Reserve $1.79 $1.30 $(0.49) - 27.4% Total Rate $18.32 $19.00 $0.68 3.7% City of Yakima Solid Waste and Recycling Division (SWRD) makes every effort to excel in quality solid waste management for the 93,000 residents of Yakima. The core business of SWRD is to provide weekly curbside residential garbage and yard waste service to approximately 26,000 residential customers who generate an average of 35,000 tons of waste per year. As part of the Interlocal Agreement with Yakima County, the City of Yakima utilizes the county's Terrace Heights Landfill to dispose of its waste. Yakima County Public Services Solid Waste Division has advised the City that they have completed a rate study for their current and future needs of their landfill. The proposed solid waste disposal rates for 2017 will increase approximately 13% over the 2016 rates. The proposed rates will cover the operational expenses, closure /post closure and capital costs for the Yakima County landfills. Yakima Utility Tax and Washington Refuse Tax will increase proportionately to the rate increase because both taxes are calculated on the assessed collection rate. The combined taxes comprise 18.6% of the total rate charged to the residential rate payers; the utility tax is 15% and the refuse tax is 3.6 %. The impact of these two fees is $3.19 per month for the customers with a 96 gallon cart. Labor and operational costs will increase due to the City's labor agreement, increases in employee health insurance, outside repair and maintenance cost for the collection fleet, and general liability insurance. The proposed rate increase included the addition of a Solid Waste Supervisor to its Division in 2016 to accommodate past growth in service areas and integration of the new Cayenta utility billing, electronic routing and mobile management systems. The addition of a Solid Waste Supervisor allows for the current supervisor to address daily operation duties such as customer service issues, complaints, solid waste violations, safety issues, accident follow ups, address illegal clean ups, fleet maintenance issues and supervision of the maintenance workers. The new supervisor position addresses the electronic routing implementation, on -going maintenance of the system and supervision of route drivers. The rate impact from the hiring of the SW Supervisor is $0.22 per residential customer per month in 2017; however, the cost per customer is expected to decrease in 2018 with the full implementation of the electronic routing and mobile management system. Rate increases in 2018 and 2019 are projected at 3.1% and 3.0% respectively; however, the collection efficiencies are expected to reduce costs by 1% in 2018 and 2019. In other words, the cost of the SW Supervisor in 2017 will be offset by the system savings of $0.21 per customer. Savings in 2018 is estimated at $0.22 and beyond. The rate impact for the 96 gallon customer over the next four year are summarized in the following table. Proposed Residential Rates for 2017 through 2019. Year 2016 2017 2018 2019 2020 96 gallon rate $18.32 $19.00 $19.59 $20.18 $20.79 $ Increase $16.02 $0.68 $0.59 $0.59 $0.61 % Increase $14.90 3.7% 3.1% 3.0% 3.0% Proposed Residential Rates for 2017 through 2019. Year 2016 2017 2018 2019 2020 96 gallon rate - Solid Waste $18.32 $19.00 $19.59 $20.18 $20.79 32 gallon rate - Solid Waste $16.02 $16.61 $17.13 $17.65 $18.18 96 gallon rate - Yard Waste $14.90 $15.37 $15.85 $16.33 $16.82 96 gallon rate - 2nd Yard Waste $7.40 $7.67 $7.91 $8.15 $8.40 Extra Can $4.23 $4.39 $4.52 $4.66 $4.80 Extra Bag $2.51 $2.60 $2.68 $2.76 $2.85 The following table details the proposed increase for container services for 2017. The increase is 3.7% over the current collection rates. Current 2016 Rates Container Size Col. Frequency 2 YD 4 YD 6 YD 1 $21.53 $34.28 $47.04 2 $34.54 $59.70 $85.56 3 $47.55 $85.12 $124.08 4 $60.56 $110.54 $162.60 5 $73.57 $135.96 $201.12 Proposed 2017 Rates Container Size Col. Frequency 2 YD 4 YD 6 YD 1 $22.33 $35.55 $48.78 2 $35.82 $61.91 $88.73 3 $49.31 $88.27 $128.67 4 $62.80 $114.63 $168.62 5 $76.29 $140.99 $208.56 IMPACTS Fiscal Impact - The proposed 2017 Yakima County landfill tipping fee will be an additional yearly cost of $134,000 to the City. The remaining cost increase are comprised of labor and operational costs of approximately $178,000. The overall fiscal impact to the Refuse Division is $313,000. Projected cost increases in 2018 and 2019 are approximately $170,000 each year. 2. Proposed Funding Source - Refuse customers / Refuse operating fund. Rate increase of 3.7% for all refuse collection rates in 2017. Proposed rate increases in 2018 is 3.1% and an increase of 3.0% in 2019 and in 2020. 3. Public Impact - This initiative will impact the public though a pass through rate increase to cover the increased cost of landfill disposal. 4. Personnel Impact - None. 5. Required Changes in City Regulations or Policies - City ordinance revising the Refuse rate schedule will be required. 6. Legal Constraints, if applicable - None. 7. Viable Alternatives - None. MEMORAND UM To: Honorable Mayor and City Council From Joan Davenport, Community Development Director Date: October 14, 2016 Subj ect: Potential Land Use Permit Fee Increases in 2017 BACKGROUND At the September 27th City Council Roundtable review of budget items, staff presented an option to increase certain land use permit application fees in order to create a more equitable sharing of the processing costs between the City and private development. The recommendation is to increase somc land use application fees so that the City recovers approximately 50% of the actual cost of processing. At present, land use applications that require a public hearing by the Hearing Examiner are only recovering an average of 17% of the actual costs. The average Hearing Examiner fee is $1595 per case. Applications without a public hearing are recovered at an average of 56 %. The Council requested information about current fee structure in Yakima County and the city of Union Gap. As you will see from the following table, the current City of Yakima land use fees are very similar to those in Union Gap. Yakima County fees are significantly higher than either city. If the recommendation to recover approximately 50% of the processing costs through fees is adopted, the anticipated additional revenue for 2017, given a similar rate of applications is about $50,000. The Council may choose one of the following options related to this proposal: 1. Do not change the fee structure at this time. This is a Council policy issue. The council is now aware of the City of Yakima is not recovering enough costs to pay the Hearing Examiner for the public hearings. This approach is a legitimate economic development strategy, but should be acknowledged. 2. The Council may choose to phase in the recommended fee increases over a period of several years. 3. The Council may choose to implement land use permit fee increases in 2017. In this case staff would immediate begin working with the Homebuilders, Board of Realtors, Landlord Tenant Association and other private industry representatives. 4. One alternative would be to shift all public hearings to the Planning Commission. However, the Planning Commission already hears Subdivision Long Plats. Other items are often very complex and require significant legal analysis, which is unfair to the unpaid Planning Commission members and may result in decisions which are subject to challenge. 5. Staff is actively looking at methods to reduce processing costs. In recent years, we modified the list of land use types listed (YMC 15.04) as "Class 3" uses that require a public hearing. The City implemented a post card notice system to reduce mailing and publication charges. Staff holds Pre - application meetings with interested developers so that they are informed early in the process about minimum requirements and procedures. Planning Fee Study for 2017 Budget Estimates Major Land Union Gap Fees Use Applications Yakima County Fees City of Yakima Fees Application Fee at 50% Cost Application Fee at 80% Cost Application Fee o at 100% of Costs Current Hearing Examiner's Fees Percent of Total Application Costs #Apps in 2015 Rezone $560 $1,255 $560 $1,614 $2,582 $3,227 34% 9 Comprehensive Plan Map Amendments $400 $4,715 $500 $1,254 $2,006 $2,508 N/A 9 Type (3) Review $700 $1,925 $700 $1,637 $2,619 $3,274 46% 5 Preliminary Long Plat $375.00 +ot$25 per $5,195 $380 $1,723 $2,756 $3,445 38% 4 Appeal to Hearing Examiner $550 $1,255 $580 $2,298 $3,677 $4,596 65% 3 Right -of -way Vacation $400 NA $420 $1,387 $2,219 $2,774 39% 2 Planned Development None $5,195 $560 $2,592 $4,147 $5,184 50% 1 Overlay District None $5,195 $340 $2,051 $3,281 $4,101 37% 0 Long Plat Alteration/Vacation $350 $870 $380 $1,723 $2,756 $3,445 38% 0 Non - Conforming Use/Structure None $1,450 $280 $1,637 $2,619 $3,274 46% 0 Intre retation Hearing Examiner $550 $1,255 $435 $2,546 $4,073 $5,091 58% 0 Variance 1 $425 1 $1,545 1 $700 1 $1,637 1 $2,619 1 $3,274 1 46% 1 0 Short Plat Exemption Applications Land Use $125 $785 $145 $38 $60 $75 N/A 40 SEPA Review $250 $295 $265 $246 $394 $492 N/A 36 Administrative eAdm ustment $300 $1,060 $340 $435 $697 $871 N/A 18 Type 2 Review $360 $1,925 $365 $430 $688 $860 N/A 18 Preliminary Short Plat $325 $1,060 $340 $438 $701 $876 N/A 14 Final Short Plat $90 $485 $90 $49 $78 $98 N/A 9 Modification $420 $675 $100 $68 $108 $136 N/A 8 Final Long Plat $250 $675 $270 $157 $251 $314 N/A 7 Critical Area Review None $870 $200 $326 $521 $652 N/A 3 Short Plat Alteration /Easement Release $225 $1,060 $245 $438 $701 $876 N/A 2 Shoreline Development Permit $325 $870 $355 $1,136 $1,817 $2,272 N/A 2 Preliminary Binding Site Plan $420 $1,925 $420 $1,637 $2,619 $3,274 N/A 1 Amended Binding Site Plan $420 None $270 $920 $1,472 1 $1,840 1 N/A 0 Comprehensive Plan Text Amendment .. None -. - None MEMO= None $1,254 $2,006 $2,508 N/A 4 Zoning Text Amendment None None None $1,254 $2,006 $2,508 N/A not tracked Shoreline Exemption None $675 None $38 $60 $75 N/A not tracked Shoreline Conditional Use or Variance $325 $3,270 None $1,226 $1,962 $2,452 N/A not tracked Development Agreements High Type 1 Review None Frequency Land None $1,350 Use Applications $485 None None $208 1 $333 $416 $248 $398 $497 N/A N/A not tracked 69 Zoning Verification Letter None None None $68 $108 $136 N/A not tracked Extension of Zoning & Subdivisions Approvals None $100 None $38 $60 $75 N/A not tracked Resubmittal Fee None $100 None N/A not tracked Pre - Application Meeting None Cost None $90 $144 $180 N/A not tracked Total Revenue Generated for 2015 with Existing Application Fees $56,000 Projected Total Revenue Generated with Fees Recover 50% of Costs $105,000 Memorandum To: City Manager, Cliff Moore Community Development Director, Joan Davenport From: Sean Hawkins, Economic Development Manager Date: September 1, 2016 Subject: Special Event Permit Fee Background YMC 9.70 covers the City's special event policies and fee structure. The City currently charges $50 for special event permits which cover a small fraction of the cost of the staff time to ensure public safety, community and business notification, insurance coverage review and providing the barricades, cones and tents for events. In 2012 the City began providing barricades and cones for special events at no charge to ensure that proper equipment is used to close City streets during events. We currently charge a $10 per tent fee. Additionally, we do not charge certain community events for the police time involved in closing streets for well attended parades like the Sunfair Parade or Holiday Light Parade. Those events involve the time of numerous officers and thousands of dollars in overtime costs all born by the City. The following details regulate costs for special event in our municipal code: ➢ Special Event Permit Application Fee - A fifty dollar nonrefundable application fee must be submitted with any special event permit application. Any event application submitted less than three weeks before the scheduled event is subject to a one - hundred dollar late fee. ➢ City Services Permit Fee - Upon approval of an application for a permit for a special event not protected under the First and Fourteenth Amendments of the U.S. Constitution, the economic development manager should provide the applicant with a statement of the estimated cost of city services, equipment and materials used or provided by city in providing traffic control and management for parades and vehicle events, and permit fees. Also exempt from the special event permit fee are the community events listed as follows: Memorial Day Parade; Cinco De Mayo Parade; 4th of July Celebration; Sunfair Parade; Veterans Day Parade; and Christmas Light Parade. Recommendation An analysis of five random events for in the last year found that the City recouped roughly 6% of the cost to produce special events from the permit fee. At a minimum, we should consider raising the fee over to 50% over the course of two years and by moving that to 25% in 2017 and 50% in 2018. A 25% recoup would be a permit fee of $225 and a 50% recoup would be a permit fee of $450. An analysis of smaller Washington cities reveals a trend to recoup more of the cost of issuing special event permits. Cities like Sunnyside and Anacortes no longer have a single special event permit cost but rather have moved to a case by case fee that reflects the costs of staff time to assist in permitting the event by having the City departments involved calculate the cost of assisting and passing them on to the permit holder. Prosser charges a $250 flat fee but also passes additional costs to produce the event on to the applicant if necessary. The City of Issaquah special event permit fee is currently $20 and they are in the works of raising this fee to $200 in 2017 to assist in recouping more of the cost to issue special event permits. Total Total Total Revenue Revenue Revenue Generated Generated for Fee Fee Fee Generated for 2015 2015 Required Required Required in 2015 with Assuming a Assuming a Current to Reach to Reach to Reach Number of Present 25% Fee 50% Fee Application 25% 50% 100% Applications Application Recapture Recapture Base Fee Recapture Recapture Recapture in 2015 Fee Rate Rate $50.00 $212.34 $424.67 $849.33 51 $2,550 $10,829.34 $21,658.17 CITY ADMINISTRATION / ECONOMIC DEVELOPMENT 2017 STRATEGIC INITIATIVE SPECIAL EVENT FEE INCREASE UNBUDGETED PROPOSAL The City currently charges $50 for special event permits, which cover only a small fraction (on average roughly 6 %) of the cost of the staff time to ensure public safety, community and business notification, insurance coverage review and to provide the barricades, cones and tents for events. It is recommended that the special event fee be increased to recapture up to 50% of the actual costs associated with special events. See attached memo for a more detailed explanation. IMPACTS 1. Fiscal Impact — Approximately $8,250 to $19,100 in additional general fund revenue, assuming a recapture rate of 25% and 50 %, respectively. This can be done over two years. 2. Proposed Funding Source — Increased fees for special events permits. 3. Public Impact — Additional fees charged for special events. 4. Personnel Impact — None. 5. Required Changes in City Regulations or Policies — Change the City's municipal code. 6. Legal Constraints, if applicable — None. 7. Viable Alternatives — Continue subsidizing special events. CITY WIDE / NEW REVENUE 2017 STRATEGIC INITIATIVE ELIMINATE LID ON ELECTRIC, NATURAL GAS AND TELEPHONE TAX UNBUDGETED PROPOSAL Eliminate the $4,000 lid of 6% tax to electric, natural gas, and telephone users - potential revenue $760,000 annually. This affects primarily larger manufacturing businesses. Washington State Revised Code of Washington (RCW) 35.21.870 allows a city to impose a tax on electricity, telephone, natural gas, or steam energy business, with a limit of six percent without a vote of the people. Yakima Municipal Code (YMC) 5.50- 050 -050 and YMC 5.50- 050 -060 governs the City's imposition of this particular tax. YMC 5.50- 050 -050 There are levied and shall be collected annual license fees or taxes against the persons on account of business activities as follows: Since October 1, 1994, the rates of tax set forth in subsection A of this section (i.e. 6 %) shall be measured against a maximum of the first four thousand dollars of the total gross revenue attributable to selling or furnishing telephone services.. or natural gas to any one customer in any one calendar month or fraction thereof. Since October 1, 1994, the first four percent of the tax is measured against a maximum of the first four thousand dollars of the total gross revenue attributable to selling or furnishing electric light or power to any one customer in any one calendar month or fraction thereof; two percent of the tax set forth in subsection A of this section shall be measured against the total gross revenue attributable to selling or furnishing electric light or power. In 2005, the tax on natural gas was changed to mirror electricity. "Since November 17, 2005, the first four percent of the tax set forth in subsection A of this section shall be measured against a maximum of the first four thousand dollars of the total gross revenue attributable to selling or furnishing natural gas to any one customer in any one calendar month or fraction thereof; two ep rcent of the tax set forth in subsection A of this section shall be measured against the total gross revenue attributable to selling or furnishing natural gas." Explanation: Telephone services are totally capped at $4,000 per customer per month, while electricity and natural gas tax the first $4,000 at 6 %, and amounts greater than $4,000 at 2 %. The following is an example of the tax calculation, assuming a monthly electric or gas bill of $10,000: Current Cap No Ca 6% on $4,000 $240 6% on $10,000 $600 2% on $6,000 excess 120 $4,000 to $6,000 Total Tax $360 Difference $240 We asked Pacific Power to provide information on different cap amounts. They provided the previous year's data from October 2015 through September 2016. We could determine that the additional amount of tax for Cascade Natural Gas customers would only be about $40,000 if the cap was totally eliminated, so we did not request additional detail. This calculation was based on calendar year 2015. The following table summarizes the data from Pacific Power and Cascade Natural Gas: Cap on 4% Max # of Capped Accounts Amount excluded annually Additional Annual Tax Cumulative $4,000 to $6,000 108 to 87 $18.Om to $16.3m $68,887 $68,887 $6,000 to $8,000 87 to 64 $16.4m to $14.8m $58,559 $127,446 $8,000 to $10,000 64 to 55 $14.8m to $13.7m $43,673 $171,119 Total Elimination 108 $18.Om $720,243 CNG Total Elim 60 in winter- 6 -10 May thru Nov $992,000 $39,696 $39,696 Total Elec & Gas $759,939 We also compiled information on what other cities in the state charge for taxes on electric and natural gas utilities. This was excerpted from the 2014 Municipal Tax Data survey. Generally, most comparable cities have the 6% tax imposed and very few have caps on the tax. The detailed spreadsheet is attached. This analysis does not consider telephone taxes, because we could not determine the numbers of accounts affected. IMPACTS 1. Fiscal Impact — $760,000 annual increase to General Fund Revenue. 2. Proposed Funding Source — General Fund Revenue. 3. Public Impact — Affects primarily large manufacturing businesses. 4. Personnel Impact —The utilities self- report —staff would need to communicate the change to the effected companies. 5. Required Changes in City Regulations or Policies — Revise YMC 5.50- 050 -050. 6. Legal Constraints, if applicable — No legal constraints when assessing tax of 6% or less. 7. Viable Alternatives — Raise the cap over time. Utility Taxes Imposed by Washington Cities Excerpted from the 2014 Municipal Tax Survey compiled by AWC Natural City Population Gas Electricity Telephone Cellular Caps (based on City research) Tacoma 200,900 6.00% 6.00% 6.00% 6.00% No cap Vancouver 167,400 6.00% 6.00% 6.00% 6.00% Elec. -6% up to $1.5 mill /mo, then 2% Gas -6% up to $2,000 /mo, then 1.25% No cap on either phone Bellevue 134,400 5.00% 5.00% 5.00% 6.00% No cap Everett 104,900 4.50% 4.50% 4.50% 4.50% No cap Kent 121,400 6.00% 6.00% 6.00% 6.00% No cap Federal Way 90,150 No cap. Sr. rebate for income only- - must be applied for Yakima 93,080 6.00% 6.00% 6.00% 6.00% $4,000 per account per mo. Cap on 4 % - -2% uncapped Bellingham 82,810 6.00% Cap on gas only - $250,000 per acct. No accts affected Lakewood 58,360 5.00% 5.00% 6.00% 6.00% No cap Kennewick 77,700 8.50% 8.50% 8.50% 8.50% No cap Renton 97,130 6.00% 6.00% 6.00% 6.00% No cap Shoreline 52,740 6.00% 6.00% 6.00% 6.00% No cap Redmond 57,700 6.00% 6.00% 6.00% No cap Auburn 74,630 6.00% 6.00% 6.00% No cap Kirkland 82,591 6.00% 6.00% 6.00% 6.00% No cap Olympia 49,670 9.00% 9.00% 9.00% 9.00% No cap Richland 52,090 8.50% 8.50% 8.50% 8.50% No cap Pasco 67,770 8.50% 8.50% 8.50% 8.50% No cap ...................................... Edmonds . . . . . . . . . . . . . . . . . . . 391 950 . . . . . . . . . . . . . . . . . . . . . . . . . . 5.75% . . . . . . . . . . . . . . . . . . . . . . . . . . 6.00% . . . . . . . . . . . . . . . . . . . . . . . . . . 5.75% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.75% Bremerton 38,180 6.00% 6.00% 6.00% 6.00% Puyallup 38,670 2.20% 2.20% 2.20% Longview 37,040 6.00% 6.00% 6.00% 6.00% Lacey 45,320 6.00% 6.00% 6.00% 6.00% Burien 48,240 6.00% 6.00% 6.00% 6.00% Bothell 41,630 6.00% 6.00% 6.00% 6.00% University Place 31,420 6.00% No 6.00% 6.00% Walla Walla 32,260 6.00% 6.00% 6.00% 6.00% No cap Des Moines 30,030 6.00% 6.00% 6.00% 6.00% Marysville 62,600 5.00% 5.00% 5.00% No Wenatchee 33,070 6.00% 6.00% 6.00% No Mount Vernon 33,170 6.00% 6.00% 6.00% 6.00% Pullman 31,420 8.00% 8.00% 8.00% 8.00% No cap Mercer Island 23,310 6.00% 6.00% 6.00% 6.00% Bainbridge Island 23,360 N/A 6.00% 6.00% 6.00% Oak Harbor 21,940 6.00% 6.00% 6.00% 6.00% Oe 4aa List of Cities.xlsx 10/20/2016 Oe 4aa List of Cities.xlsx 10/20/2016 2 Natural City- Population Gas Electricity Telephone Cellular Caps (based on City research) Mountlake Terrace 20,530 6.00% 6.00% 6.00% 6.00% Mukilteo 20,540 6.00% 6.00% 6.00% 6.00% Kenmore 23,370 4.00% 4.00% 6.00% 6.00% Port Angeles 19,090 N/A 6.00% 6.00% 5.50% Tukwila 19,210 6.00% 6.00% 6.00% Aberdeen 16,850 6.00% 6.00% 6.00% No Ellensburg 18,440 6.00% 6.00% 6.00% 6.00% Maple Valley 24,230 6.00% 6.00% 6.00% Moses Lake 21,600 6.00% 6.00% 6.00% 8.00% Tele /Elec -$100K W /S -$150K Average Rate 5.70% 5.71% 5.78% 5.89% Note: Utility tax rates are based on a 2014 survey conducted by AWC. Only cities with a population > 16,000 are shown. Bolded cities are often used as comparables for Yakima. Entry's in the "Caps" column come from research done in 2006, and were spot checked to utility rate sheets. Oe 4aa List of Cities.xlsx 10/20/2016 2 CITY WIDE / NEW REVENUE 2017 STRATEGIC INITIATIVE ESTABLISH BROKERED NATURAL GAS UTILITY TAX UNBUDGETED PROPOSAL To establish a tax rate of 6% upon consumers of brokered natural gas. RCW 35.21.870 authorizes cities to impose this tax, and the Washington Administrative Code (WAC) 458 -20- 17902 gives additional guidance on how this tax is calculated and reported to the Washington State Department of Revenue (DOR). The following is an excerpt from a DOR publication: History The state and municipal taxes on brokered natural or manufactured gas were adopted by the Legislature in 1989; the effective date of the taxes was July 1, 1990. The need for these taxes was a result of federal deregulation of the natural gas industry. Increasingly, large industrial and institutional users of gas have been able to make purchases of gas from sellers in other states through brokers; this enables large purchasers to take advantage of differentials on the spot market for natural gas. Although the gas may be delivered through the pipeline of a local gas company, the transaction is considered to take place out of state. Some utilities had been reporting retail sales tax on such sales and some purchasers had reported use tax, but there was confusion about the tax liability of such transactions until the Legislature enacted the 1989 statute. There are currently 274 taxpayers that report use tax on natural /manufactured gas. The Department currently administers the municipal use tax on natural /manufactured gas for 46 cities, although not every one of them receives revenues each year depending upon when the taxable transactions occur. Washington State Department of Revenue, 'Brokered Natural Gas Use Tax RCWS 82.12.022 and 82.14.230" 140ctober, 2016. http: / /dor.wa.gov /docs /reports /2010 /tax reference 2010 /24brokeredgas.pdf In discussion with a representative from DOR, this tax rate would need to mirror the local tax rate for natural gas. In other words, if the lid on our natural gas utility tax stays at 4% on the first $4,000 per customer per month, the Brokered Natural Gas would need to have the same lid. Based on information from Department of Revenue, the City would have collected about $54,000 in the past year if the current tax rate of 6% on all amounts up to $4,000 /customer /month, and 2% on all amounts greater than $4,000 had been in place. If the lid was removed and 6% was charged on the full monthly amount, we would have received $113,000. Most of the cities comparable in size (i.e. Population 50,000- 130,000) have imposed this tax: Auburn Kirkland Bellevue Marysville Everett Redmond Kennewick Kent Renton Richland Also, many other cities in neighboring communities and in Eastern Washington: Goldendale Selah Wenatchee Grandview Spokane Pasco Sunnyside Prosser Union Gap Pullman Walla Walla IMPACTS 1. Fiscal Impact - $113,000 annually to General Fund Revenue if imposed with no $4,000 lid on 4% of the tax or $54,000 with a $4,000 lid. 2. Proposed Funding Source - General Fund Revenue. 3. Public Impact - Affects primarily large manufacturing businesses. 4. Personnel Impact - The City would not need a collection effort - -the State Department of Revenue would collect and submit the tax to the City in our monthly remittance. 5. Required Changes in City Regulations or Policies - Revise YMC 5.50- 050 -050 to include Brokered Natural Gas or establish a new and separate code. 6. Legal Constraints, if applicable - No legal constraints when assessing tax of 6% or less. Viable Alternatives - This is a Council decision. ul=��IIIMI October 12, 2016 TO: Honorable Mayor and Members of the City Council FROM: Bronson Faul, Sr. Assistant City Attorney SUBJECT: Transportation Benefit District # GO Memorandum to Mayor and City Council October 12, 2016 Page 2 important note is that actual fee cannot be imposed within 180 days after being passed and that the department of licensing will keep a 1 % administrative fee. The only other revenue that may be imposed without a vote of the electors are fees on certain construction projects but the fees have to be reasonably necessary as a result of the impact of construction. All other funding sources must be approved by a vote of the electors and include a one year ad valorem property tax, an ad valorem property tax to pay off voter approved general obligation bonds, vehicle tolls and a sales tax. Projects The legislature has defined "transportation project" to mean a project contained in the transportation plan of the state, a regional transportation planning organization, city, county, or eligible jurisdiction. A project may include investment in new or existing highways of statewide significance, principal arterials of regional significance, high capacity transportation, public transportation, and other transportation projects and programs of regional or statewide significance including transportation demand management. Projects may also include the operation, preservation, and maintenance of these facilities or programs. There is also a set of criteria that have to be considered when choosing which transportation improvements to put on the project list and includes improved travel times, air quality, freight mobility and other criteria as may be developed by the governing body. Material Change Policy and Annual Report The TBD shall also develop a material change policy to address major plan changes that affect project delivery and financing. At a minimum, the policy must address material changes to cost, scope, and schedule, the level of change that will require governing body involvement, and how the governing body will address those changes. The policy must also include a provision that if a transportation cost exceeds its original cost by more than twenty percent, there will be a public hearing to solicit comment from the public regarding how the cost change should be resolved. Another requirement is the TBD shall issue an annual report to the public and newspapers indicating the status of costs, expenditures, revenues, and schedules. Termination Once construction is complete, the TBD must terminate day -to -day operations and exist as a limited entity that oversees the collection of revenue and the payment of debt still in effect. When the debt is complete and paid, the TBD has thirty days to dissolve itself with notice of the dissolution published. Assumption In 2015, the legislature allowed for a city to assume the rights, powers, functions, and obligations of the TBD after notice and a hearing. This can be done through ordinance or resolution and after a finding that the public interest or welfare would be satisfied by the city assuming those duties and obligations. 2012 TBD Legislation ITEM TITLE: Transportation Benefit District (TBD) Public Hearing and Ordinance to Other (specify) hear from the pudic on the creatiort of a T80, comprising the corporate Mail to: limits of the City, to fund and complete the projects listed in the City's 5- Contract Term: Year Failed Arterials Repair Program SUBMITTED BY: Chris Waarvick, Director of Public Works Joe Rosenlund, Streets & Traffic Operations Manager CONTACT Joe Rosenlund, Streets & Traffic Operations Manager (575 -6005) PERSON/TELEPHONE- Various Local Funding Sources Source: SUMMARY EXPLANATION: At the January 10, 2012 City Council Business Meeting, a resolution was passed to hold a public hearing on the issue of creating a Transportation Benefit District (TBD) for pavement preservation. The next step is to hold a public hearing on the ordinance that creates the TED, its boundaries, composition of its board and defines the transportation improvements the district is to accomplish. This action does not enact a car tab fee or other funding mechanism. Per RCW 36.73 050, the Council must hold a public hearing prior to determining if a TBD should be created. After the public hearing, the Council may create the district by ordinance, set another time to create the TBD or take no action. A draft ordinance is attached for reference Resolution Ordinance X Other (specify) Contract: Mail to: Contract Term: Amount: Expiration Date: Insurance Required? No Funding Various Local Funding Sources Source: Phone: APPROVED FOR SUBMITTAL: 4�v- City Manager -- - STAFF RECOMMENDATION: BOARDICOMMISSION RECOMMENDATION: ATTACHMENTS: RESOLUTION NO. R- 2012 -11 A RESOLUTION setting the time and place for hearing on February 7, 2012 at 7:00 PM in the City of Yakima . Council Chambers to hear from the public on the creation of a Transportation Benefit District, comprising the corporate limits of the City, to fund and complete the projects listed in the City's 5 -Year Failed Arterials Repair Program. WHEREAS, the City of Yakima proposes creating a Transportation Benefit District as authorized by RCW 35.21.225 and governed by the provisions of Chapter 35.73 RCW; and WHEREAS, a public hearing must be held prior to the creation, now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: That said Transportation Benefit District shall be presented for hearing and determination on Tuesday, February 7, 2012, at the hour of 7:00 p.m. in the Council Chambers of the City of Yakima, at Yakima City Hail, Yakima, Washington, or as soon thereafter as the same may be heard, and that notice of such hearing be given as approved by law. ADOPTED BY THE CITY COUNCIL this 10th day of January, 2012. ATTEST; /s/ Deborah Kloster City Clerk /s/ Micah Cawley Mayor AN ORDINANCE of the City of Yakima, Washington, relating to a Transportation Benefit District; establishing a Transportation Benefit District, specifying that the boundaries will coincide with the City boundaries; and specifying the transportation improvements to be funded by the district. WHEREAS, RCW 35 21 225 authorizes the legislative authority of a city to establish a transportation benefit district ("TBD "), for the purpose of acquiring, constructing, improving, providing, and funding transportation improvements within the TBD, subject to the provisions of chapter 36.73 RCW; and WHEREAS, the improvement, maintenance, and protection of public ways requires building sufficient capacity to adequately accommodate existing congestion and anticipate future congestion, and also requires maintaining and preserving existing transportation improvements to avoid catastrophic failure which would result in costly reconstruction; and WHEREAS, the City has limited transportation funding to pay for necessary transportation projects that may alleviate congestion and preserve and maintain existing infrastructure; and WHEREAS, the City's 5 -Year Failed Arterials Repair Program, attached as Exhibit "A," identifies projects that also constitute transportation improvements that may be funded by a TBD; and WHEREAS, the City provided proper notice, conducted a public hearing on February 7, 2012 and took public comment regarding the proposed establishment of a TBD in accordance with RCW 36 73.050; and WHEREAS, the City Council desires to form a TBD which includes the entire City of Yakima as the boundaries currently exist or as they may exist following future annexations; and WHEREAS, the City Council finds it to be in the best interests of the City to establish a citywide TBD to provide for preservation and maintenance of the city's transportation infrastructure consistent with RCW Chapter 36.73, and WHEREAS, the City Council shall establish a governing body for the TBD comprised of the City Council acting in an ex officio and independent capacity; Now, Therefore, BE IT ORDAINED BY THE CITY OF YAKIMA: Section :1. The City Council finds it is in the public interest to provide adequate levels of funding for transportation improvements through the establishment of a TBD. The City Council further finds that the City's 5 -Year Failed Arterials Repair Program constitutes transportation improvements that may be funded by a TBD and did consider the criteria listed in RCW 36 73.020(1) when selecting these projects. Section 2. The City, pursuant to RCW 35.21.225 and Chapter 36.73 RCW, hereby establishes and creates a TBD to be known and referred to as the City of Yakima TBD, subject to the following, 1 Establishing a Transportation Benefit District. There is created the City of Yakima TBD with geographical boundaries comprised of the corporate limits of the City, as these boundaries may be amended following future annexations. 2 Governing Board. a. The governing board of the City of Yakima TBD shall be the Yakima City Council acting in an ex officio and independent capacity, which shall have the authority to exercise the statutory powers set forth in Chapter 36.73 RCW. b The treasurer of the transportation benefit district shall be the City Finance Director consistent with RCW 36 73.020(4). c. The board shall develop a material change policy to address major plan changes that affect project delivery or the ability to finance the plan, pursuant to the requirements set forth in RCW 36.73.160(1). At a minimum, if a transportation improvement exceeds its original cost by more than twenty percent, as identified in the district's original plan, a public hearing shall be held to solicit public comment regarding how the cost change should be resolved. 3. Powers of the District. The City of Yakima TBD shall possess only the powers of a transportation benefit district provided by law, as it now exists or is hereafter amended 4. Transportation Improvements Funded. The funds generated by the City of Yakima TBD shall be used for the TBD projects described in Section 1 of this ordinance. The TBD projects may be amended in accordance with the material change policy described in Section 2(2)(c) of this ordinance and in accordance with the notice, hearing and other procedures described in Chapter 36.73 RCW, as it now exists or is hereafter amended. 5. Annual Report to the Public. As required by RCW 36.73,164(2), the Board shall issue an annual report, indicating the status of transportation improvement costs, transportation improvement expenditures, revenues, and construction schedules, to the public and to newspapers of record in the City of Yakima TBD. 6. Dissolution of District. The transportation district shall be automatically dissolved when all indebtedness of the district has been retired and when all of the district's anticipated responsibilities have been satisfied. Section 3. If any section, subsection, sentence, clause, paragraph, phrase, or word of this chapter should be held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or unconstitutionality thereof shall not affect the validity or constitutionality of any other section, subsection, sentence, clause, paragraph, phrase or word of this chapter. Section 4. This ordinance shall become effective and shall be in full force and effect 30 days after its passage and publication in accordance with law. 2 PASSED BY TIME CITY COUNCIL this 7t' day of February, 2012. Micah C y, Mayor ATTEST: City Clerk v SEAL, ®,gym l Publication Date: February 10 20 Effective Date, 2012 9SHiNG'c�� 3 Exhihit A< Transportation Benefit District Propose 5 -Year Project List Street From To Sq Ft Treatment Cost/S F Total Cost Maint. Year Year 1 3rd St Arlington Beech 95000 Mill & Overlay $3.42 $324,900.00 2013 Lincoln Av 56th Ave 66th Ave 68880 Mill & Overlay $3.42 $235,569.60 2013 Yakima Av 12th Ave 16th Ave 81200 CIR $4.87 $395,444.00 2013 $955,913.60 Year 2 D St 1st St 5th Ave 122200 CIR $4.87 $595,114.00 2014 25th Av Englewood Castlevale 31050 Mill & Overlay $3.42 $106,191.00 2014 Lincoln Av 40th Ave 46th Ave 77000 CIR $4.87 $374,990.00 2014 $1,076,295.00 Year 3 Pecks Canyon Rd Scenic Dr City Limit 4620 Mill & Overlay $3.42 $15,800.40 2015 Viola Av 1 st St Fair Ave 35100 Mill & Overlay $3.42 $120,042.00 2015 24th Av Washington Mead 122500 CIR $4.87 $596,575.00 2015 G St 3rd St 6th St 38400 Mill & Overlay $3.42 $131,328.00 2014 G St 1st St 3rd St 22400 Mill & Overlay $3.42 $76,608.00 2015 Walnut St 3rd Ave 5th Ave 36400 CIR $4.87 $177,268.00 2015 $1,117,621.40 Year 4 6th St Yakima Pacific 220000 Mill & Overlay $3.42 $752,400.00 2016 Scenic Dr 4202 Scenic 4615 Scenic 53406 Mill & Overlay $3.42 $182,648.52 2016 Walnut St 1st St 3rd St 36400 CIR $4.87 $177,268.00 2016 $1,112,316.52 Year 5 3rd Av Yakima Walnut 68000 CIR $4.87 $331,160.00 2017 Lincoln Av 24th Ave 32nd Ave 109000 CIR $4.87 $530,830.00 2017 $861,990.00 Unfunded 24th Av Mead Nob Hill 127400 CIR $4.87 $620,438.00 Walnut St 5th Ave 7th Ave 36400 CIR $4.87 $177,268.00 Pierce Av Summitview Lincoln 40000 Mill & Overlay $3.42 $136,800.00 Fruitvale Blvd 2100 Fruitvale 3000 Fruitvale 256000 HIR $7.73 $1,978,880.00 Fruitvale Blvd 3000 Fruitvale I 4000 Fruitvale 276000 HIR $7.73 $2,133,480.00 $5,046,866.00 D Street is not an arterial but is critical for emergency response. 4 As of August 2016, MRSC is aware of about 90 cities and towns that have formed TBDs, of which about half have assumed the TBD's rights, powers, functions, and obligations under chapter 36.74 RCW. The funding source indicates existing or approved revenue streams. Jurisdiction TBD Established Funding Source Powers Assumed? Aberdeen 2012 0.13% sales tax No Airway Heights 2013 0.20% sales tax No Anacortes 2014 $20 vehicle license fee Yes Arlington 2013 0.20% sales tax No Auburn 2011 Unfunded /No information - $59 million bond measure failed in 2012 No Bainbridge Island 2012 $20 vehicle license fee Yes Battle Ground 2014 $20 vehicle license fee Yes Bellingham 2010 0.20% sales tax Yes i Black Diamond 2015 $20 vehicle license fee Yes Bothell 2015 Unfunded /No information No Bremerton 2009 $20 vehicle license fee - voted $30 fee failed in 2009 Yes Buckley 2012 $20 vehicle license fee Yes Burien 2009 $10 vehicle license fee - voted $30 fee failed in 2009 No Carbonado 2012 $20 vehicle license fee No Castle Rock 2012 0.20% sales tax No Centralia 2014 0.20% sales tax Yes Clarkston 2014 0.20% sales tax - replaced a $20 vehicle license fee Yes Covington 2013 $20 vehicle license fee - 0.2% sales tax failed in 2013 and 2015 Yes Dayton 2014 0.20% sales tax No Des Moines 2008 $40 vehicle license fee (nonvoted) Yes DuPont 2013 $20 vehicle license fee No Duvall 2015 Unfunded /No information Yes East Wenatchee 2012 $20 vehicle license fee Yes Eatonville 2012 $20 vehicle license fee Yes Edgewood 2013 $20 vehicle license fee No Edmonds 2008 $20 vehicle license fee - voted $40 fee increase failed in 2010 No Electric City 2012 $20 vehicle license fee Yes Ellensburg 2015 0.20% sales tax Yes Elmer City 2015 0.20% sales tax No Enumclaw 2013 $20 vehicle license fee, 0.10% sales tax No Everett 2014 $20 vehicle license fee Yes Ferndale 2011 0.20% sales tax Yes Fife 2015 Unfunded /No information No Friday Harbor 2014 0.20% sales tax Yes Jurisdiction TBD Established Funding Source Powers Assumed? Grandview 2011 $20 vehicle license fee Yes Granite Falls 2015 $20 vehicle license fee Yes Katama 2012 $20 vehicle license fee No Kelso 2012 $20 vehicle license fee Yes Kenmore 2012 $20 vehicle license fee No Kirkland 2014 Unfunded /No information No Kittitas 2012 $20 vehicle license fee Yes Lacey 2016 Unfunded /No information Yes Lake Forest Park 2008 $40 vehicle license fee Yes Lakewood 2012 $20 vehicle license fee No Leavenworth 2010 0.20% sales tax No Liberty Lake 2002 Unfunded /No information No Lynden 2012 0.20% sales tax No Lynnwood 2010 $20 vehicle license fee - 0.2% sales tax failed in 2014 No Mabton 2011 $20 vehicle license fee Yes Maple Valley 2012 $20 vehicle license fee Yes Marysville 2013 0.20% sales tax Yes Mattawa 2015 0.20% sales tax Yes Mercer Island 2014 $20 vehicle license fee Yes Monroe 2012 0.20% sales tax No Mountlake Terrace 2011 $20 vehicle license fee No Normandy Park 2013 $20 vehicle license fee Yes Vorth Bend 2011 0.20% sates tax No Dlympia 2008 $20 vehicle license fee ($40 fee takes effect in Jan. 2017) No Drting 2011 $20 vehicle license fee Yes Jthello 2012 0.20% sales tax (passed in April 2016 after failing in Nov. 2013) No sort Orchard 2015 Unfunded /No information No Irosser 2009 $20 vehicle license fee No Ridgefield 2008 Unfunded - 0.2% sales tax repealed in 2012 No Roy 2014 $20 vehicle license fee Yes Royal City 2012 $20 vehicle license fee Yes ieattle 2010 $80 vehicle license fee, 0.10% sales tax No iedro- Woolley 2014 $20 vehicle license fee Yes iequim 2008 0.20% sates tax No Jurisdiction TBD Established Funding Source Powers Assumed? Shelton 2015 0.20% sales tax Yes Shoreline 2009 $20 vehicle license fee Yes Snohomish 2010 0.20% sales tax Yes Snoqualmie 2010 $20 vehicle license fee Yes Soap Lake 2013 $20 vehicle license fee Yes Spokane i 2011 $20 vehicle license fee No Stanwood 2012 0.20% sales tax Yes Steilacoom 2015 Unfunded /No information No j i Tacoma 2012 $20 vehicle license fee, 0.10% sales tax No Toppenish 2012 $20 vehicle license fee Yes Tumwater 2014 0.20% sales tax Yes Twisp 2016 0.20% sales tax No University Place 2009 $20 vehicle license fee Yes Vancouver 2015 $20 vehicle license fee No Waitsburg 2012 0.10% sates tax No Walla Walla 2011 0.20% sales tax No Wapato 2012 $20 vehicle license fee Yes Washougal 2015 Unfunded /No information No Wenatchee 2011 $20 vehicle license fee Yes Wilkeson 2014 $20 vehicle license fee No Woodland 2016 Unfunded /no information No Zillah 2011 $20 vehicle license fee Yes List of County TBDs Several counties have explored the idea of a transportation benefit district, but MRSC is only aware of five that have established a TBD. Of those, one relies on the border area fuel tax and the rest are unfunded. Jurisdiction TBD Established Funding Source Powers Assumed? King County 2014 Unfunded - voted $60 license fee /0.1% sales tax failed in 2014 No Pierce County (unincorporated) 2014 Unfunded No Point Roberts (formed by Whatcom County) 1992 $0.01 /gallon border area fuel tax N/A Snohomish County (unincorporated) 2011 Unfunded No Thurston County (unincorporated) 2014 Unfunded No Last Modified: August 17, 2016 © 2015 MRSC of Washington. All rights reserved. Privacy & Terms. MEMORANDUM To: The Honorable Mayor and City Council From: Cindy Epperson, Director of Finance and Budget Date: October 20, 2016 Re: Transmittal of Sales Tax data At the roundtable discussion held on September 27, there was a discussion on how we estimate sales tax, and a request from Council to review the year to date sales tax data. The City of Yakima's sales tax receipts generally follow rather predictable patterns. For the years leading up to the recession (2001- 2008), the average rate of growth was 4.0 %, although it ranged from 2.2% to 6.1 %. Through the recession, sales tax dropped by 8.3% in 2009, and stayed at that lower amount through 2011, and jumped quickly at the end of the recession by 7.2% in 2012, and sustained growth rates of 6.7 %, and 6.4% in 2013 and 2014 respectively. 2015 started out in a similar fashion, with a growth rate of 6.0% through the 1 st quarter, which is when a drought was declared. 2015 ended the year with an annual growth rate of 2.9 %, although the budgeted growth rate was 4.2% which seemed conservative in view of the 3 most recent years. 2016 started out slowly as well, being flat through the 1st quarter. Recent months have seen an upturn, and we anticipate finishing the year stronger, and returning to our average growth rate of 4.0 %. 2017 is currently budgeted slightly below our average at 3.8 %. Historically, City of Yakima sales tax responds negatively in a year when a drought is declared, because consumer confidence drops because of the threat of reduced crops and resulting cash flows in the agricultural sector of our economy, which is our largest economic driver. Businesses that collect sales tax report by the North American Industry Classification System ( NAICS) codes. This is a standardized system to classify businesses to collect statistical data related to the U. S. economy. The complete code is 6 digits, but for the purposes of our summaries, we look at the aggregation of the first 3 digits. The attached schedule lists the summary NAICS codes for all of the categories that collected over $100,000 in the last 12 months. These 26 categories make up 93% of the total tax collected in that period. By state law, the City is prohibited from releasing data that can identify the sales of a particular business, so any category published needs to have a minimum of 3 businesses included. Since these are major categories, there are many businesses in each, so we are not in danger of violating this rule. There was an error in what I presented at the roundtable, in that the underlying data I was reviewing had a portion of the "Motor Vehicle and Parts Dealers" category in an unidentified NAICS code, so my observation that this category was down through the first part of the year was not correct. This category is actually experiencing growth of 7.0% for the first 9 months of the year. However, the second largest category, "General Merchandise Stores" is down 3.2% in this same time frame. The large reduction is in the area of "Construction of Buildings ". If this category would have just stayed flat, the year to date growth rate would be 4.6 %, instead of the current 2.6 %. This is often the most volatile category -- permitting activity is a pre- cursor to construction sales tax, and that is also taken into consideration when doing these estimates. KA City of Yakima Sales Tax -by NAICS Code GROUP ANALYSIS BY SIZE Current Period: 201607 Cash Basis, Revenue Amounts Group NAICS Code Name 441 Motor Vehicle and Parts Dealers 452 General Merchandise Stores 722 Food Services and Drinking Places 444 Building Material and Garden Equipment and Supplies 423 Merchant Wholesalers, Durable Goods 236 Construction of Buildings 238 Specialty Trade Contractors 517 Telecommunications 445 Food and Beverage Stores 453 Miscellaneous Store Retailers 532 Rental and Leasing Services 811 Repair and Maintenance 424 Merchant Wholesalers, Nondurable Goods 443 Electronics and Appliance Stores 721 Accommodation 454 Nonstore Retailers 451 Sporting Goods, Hobby, Musical Instrument, and Books 541 Professional, Scientific, and Technical Services 448 Clothing and Clothing Accessories Stores 446 Health and Personal Care Stores 561 Administrative and Support Services 926 Administration of Economic Programs 442 Furniture and Home Furnishings Stores 447 Gasoline Stations 713 Amusement, Gambling, and Recreation Industries 237 Heavy and Civil Engineering Construction Subtotal- categories > $100,000 in last 12 months All other categories Total 16,248 Accounts Year to Date This Year Last Year % Chg Last 12 Months $ 1,687,704 $ 1,576,682 1,325,980 1,370,376 1,191,133 1,123,380 825,813 762,352 707,859 669,005 585,301 820,696 528,916 528,468 483,334 488,140 368,211 370,915 352,106 300,426 353,973 331,154 321,779 315,698 301,322 258,108 243,751 224,339 203,873 189,357 214,712 208,349 187,907 160,533 183,992 188,245 179,647 174,017 175,061 157,799 166,798 124,596 148,400 145,648 143,119 142,950 133,706 131,012 104,685 91,165 87,663 34,521 11, 206,7 42 10,887,931 7.0 $ 2,242,238 3.2 1,739,584 6.0 1,589,156 8.3 1,077,814 5.8 954,274 -28.7 802,949 0.1 702,691 -1.0 662,930 -0.7 491,479 17.2 479,957 6.9 468,922 1.9 421,146 16.7 412,185 8.7 322,714 7.7 288,352 3.1 281,190 17.1 249,745 -2.3 242,599 3.2 237,845 10.9 227,586 33.9 217,880 1.9 208,673 0.1 196,018 2.1 179,170 14.8 137,945 153.9 127,336 2.9% 14,962,375 801,333 811,291 -1.2% 1,112,972 12,008,076 11,699,223 2.6% 16,075,347 Note: The City cannot publish information that can identify the sales information for one particular business. That is why we aggregated the categories that produced less than $100,000 in the past year. NAILS: The North American Industry Classification System (NAILS) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analying, and publishing statistical data related to Year to Date column includes 9 months - -tax returns from 201511 to 201607 -- received by The City January -1 -: through September. 5a Sales tax by NAICS code .xlsx MEMORANDUM Date: October 13, 2016 To: The Honorable Mayor and Members of the Yakima City Council From: Cliff Moore, City Manager Subj ect: 2017 Options for GFI/YPAL/Miller Park In various settings, including the September 27, 2016 Council Roundtable, there has been discussion regarding the status of the contract with YPAL for the provision of Gang Free Initiative (GFI) services at the Miller Park facility. Council members have shared a variety of perspectives and as we approach the end date of the current programming contract with YPAL (December 31, 2016), and as we look at the 2017 budget, there are a number of ways the Council could decide to utilize the funding currently provided to YPAL ($110,000). In addition, at Council's direction, the GFI related contract with People For People ($21,500), will not be continued into 2017, so that funding as well, could be available to program at Miller Park. With this message, I will attempt to summarize what I understand are the current activities, interests, opportunities and concerns that have been expressed. YPAL offers programs at the Miller Park facility that reach a number of young people in the community. These programs include boxing, wrestling, cheerleading, and art classes. Also offered are some leadership development activities and culinary classes. In addition to a small staff, YPAL reports that they are assisted in program delivery by community volunteers and parents. Although it is not totally clear, it seems that while many of the participants in YPAL programs come from the Miller Park neighborhood, some reportedly do not. YPAL programs occur mostly in the afterschool hours, from approximately 3:00 pm to 8:00 pm. While this provides young people an opportunity to be constructively engaged in the hours when they may not have other adult supervision, thus helping them keep on a positive pathway, it leaves the facility available for additional programming opportunities during the day. Some of the ideas that have been discussed include creating more of a "Community Center" like suite of programs that would be available days, evenings and weekends so that the facility becomes a hub of activity for the neighborhood. A "Community Center" approach could certainly complement GFI activities. YPAL has indicated an interest in partnering with other organizations to develop a complimentary set of programs and to that end, invited the WSU Extension staff to tour the facility and discuss the kinds of programs WSU offers. Whether it be Extension or other organizations, the kinds of programs that have been mentioned include: parenting, strengthening families, nutrition, canning and food preparation, senior services, homework/tutoring and creating a computer lab. Having programs available in both English and Spanish would be beneficial. According to the current contract, YPAL Objectives for the 2016 contract year include: 1. Provide Life Skills programming to 120 youth during non - school hours. YPAL reports providing these programs for a total of 312 individuals through August 2016 2. Maintain a minimum of two full time equivalent staff or volunteer positions to deliver the Objectives 3, 4 and 5 below. YPAL reports maintaining two full -time staff members and that they have developed a corps of volunteers to assist and augment services appropriate to the growth of the neighborhood and community. 3. Conduct general outreach services to 250 to 500 youth at risk of or involved in gangs by December 31, 2016. YPAL reports that through August 2016, they have had contact with 478 juveniles along with many parents, for a total of 1, 090 visits to the facility. In addition, they note that have also had numerous other interactions with families, school officials, and mental health facilities to advocate on behalf of youth. These efforts have resulted in the school re -entry for at least 3 youth. 4. Conduct a minimum of 4 to 8 gang awareness seminars targeting each middle school by December 31, 2016. Through August 2016, YPAL conducted presentations at four elementary schools and two middle schools. Some programs were offered in both English and Spanish. 5. Use the Washington Assessment of Risks and Needs of Students (WARNS) to screen and refer a minimum of 50 youth at risk of or involved in gangs and prepare appropriate referral based on the results by December 31, 2016. YPAL reports completing WARNS testing and appropriate referrals for over 100 youth through August 2016 YPAL has provided regular invoices showing programs offered and number of individuals served. Based on the YPAL reporting, it appears that they have met contractual obligations. Nevertheless, several questions have been asked about the impact of current YPAL activities. They include: 1. Are the youth currently participating in YPAL activities actually at risk of gang involvement? 2. And if so, can it be demonstrated that these activities are effective in keeping them out of gang related activities? 3. Are there other evidence based programs that are proving more effective in reducing gang activity? We understand that YPAL is interested in providing some additional assessment information for Council to review and that information could address the above noted questions, as well as ideas they have to expand program offerings. In looking ahead, Council has a full spectrum of options available — from simply extending the current YPAL contract to opening up an RFP and soliciting new proposals. And of course, Council always has the option of terminating the program and using the funding for other purposes, including fund balance. If the decision is to fund YPAL again, the City would need to do a contract amendment — which could be for a full year, or part of a year. A new contract could include updated deliverables, such as an impact assessment and the direction to expand programming through collaborative agreements and have the facility open during the day and on weekends on a regular basis. It is quite probable that in order to expand programming and hours of operation, additional funding beyond the current $110,000 level would be required. As noted above, the $21,500 from the discontinued People For People contract could potentially be available for these purposes. Regardless of the direction chosen by Council, there may be value in consulting with some experts in the field of gang prevention and intervention to inform an updated set of obj ectives. Several other issues regarding the relationship with YPAL and the Miller Park facility should also be on the table for discussion. They include: 1. Currently, the City has a Site Use contract with YPAL for the operation of the Miller Park facility that goes through December 31, 2019. There is a 30 day termination clause in the contract. If the City opts not to continue with the YPAL programming contract, it is unclear if they would be in a position to fulfill the facility operation contract. 2. Currently, the Miller Park building is covered by City insurance — both for the facility and for liability (injuries). Regardless of who provides programming in the facility, this insurance should be continued. 3. The City also has a contract with Washington Fruit to invest in upgrades for the facility. That contract, initiated in 2014, calls for Washington Fruit and the City to each invest $50,000 per year for a five year period to undertake phased upgrades. Phases 1 and 2 have been completed and Phase 3 is in the planning stages. Regardless of what entity has responsibility for programming at the Miller Park facility, it is expected that this agreement with Washington Fruit will continue through its scheduled termination date. Depending on Council decisions regarding the facility, future improvements could include upgrades specific to supporting new or ongoing program activities, such as the installation of new windows along the park side of the building to enhance visibility of activity in the park. In conclusion, as noted above, the full spectrum of options are available to Council. I am hoping that with this memorandum, you have the information necessary to give staff direction on next steps. Response from Kathy Coffey via email dated October 14, 2016: Cliff, while I appreciate your attempt to capsulate the various conversations regarding the status of the contract with YPAL for the provision of the Gang Free Initiative (GFI) services at the Miller Park Facility, I think there are a number of other questions that are inter - related to that conversation. I'm concerned that without separating those inter - related issues and dealing with those issues on a parallel track the end result may not accomplish the best results for the Northeast neighborhood, nor the City of Yakima. I'll do my best to articulate those concerns while realizing that they are only my best understanding and interpretation of the issues and may not fully express the beliefs of others. GFI /YPAL /MILLER PARK GFI for all intents and purposes is dead, therefore it should be buried and a discussion needs to take place as to what the city of Yakima wants to do in regards to the prevention and intervention of gangs. Suppression of gangs is being handled by YPD. Many cities include a reentry component to their gang program, Yakima never has. A decision needs to be made whether Yakima is going to have an aggressive gang deterrent program. If so, then a gang RFP should be written by a professional in the field that outlines the OJJDP model that the state of WA is using for their grant programs so that we would be eligible for enhanced funding, as well as any Federal funding. I do not agree that staff, school district, and assorted community members help write any RFP for a gang deterrent program. YPAL does provide a needed service in that neighborhood. If the city does not want the programs to be open to anyone outside the neighborhood (currently approximately 21) then that should be stipulated in their contract. If additional services are needed or warranted, then those services should be outlined in detail. All programs that are contracted for should have evidenced based criteria that are monitored and reviewed with YPAL monthly. If impact reporting is required, select a city accepted model and require that it be adopted. MILLER PARK FACILITY - WASHINGTON FRUIT FACILITY - BUILDING What's the facilities name? Was a dedication to Washington Fruit ever done? Renovations are under way to the restrooms. More renovations are due for the next three years at approximately $100,000 per year. Decisions on the use of the facility need to be made prior to any more renovations so that work done isn't done in vain. Current contract with YPAL for Site Use through December 31, 2019, 1 believe it's for $70,000. City insurance for facility and liability, pretty standard procedure. As I recall, the facility has a very nice kitchen that could be utilized much more than currently used. I don't believe that Junior League is doing cooking classes there but I understood that Ned Walsh (901 Pasta) was going to be doing some culinary classes in the near future. The offices and conference rooms could generate a minimum amount of funds if rented out but that could restrict use for community use. Youth development programs based out of the WA Fruit Facility to encourage, train and place youth into the work force has also been discussed by some of the council members, as has one of my desires for community policing being housed out of the facility. The major over - riding question is what is the facilities purpose? If it is going to be a dual use (community center & gang deterrent) then decisions based on that would drive design factors. There are conflicting arguments as to if those two purposes can be housed in the same facility. If they are going to be then specific design, staffing and safety factors need to be included in the discussion. Currently the most successful program and according to many the best gang deterrent is YPAL's athletic programs. There have been many testimonials about how the boxing and wrestling program kept young people out of gangs. It seems that those would be one area that the city would be interested in keeping and potentially expanding on. If that's the case, consideration regarding the amount of space required for those activities need to be part of the dialogue. OTHER QUESTIONS INTER - RELATED TO GFI /YPAL /MILLER PARK FACILITY Council Member Dulce Gutierrez has asked the council and staff to review the entire Miller Park and that it include the facility located on the Park grounds as part of that process. I don't know how that can be done without a clear determination of what is going to be done about YPAL. I think that her request is valid and necessary, yet can't be done in a vacuum and must include a clear definition and direction that addresses the questions above. It's my understanding that her request includes an examination by staff of the safety of the grounds, starting with a review of CPTED design principles, review of policy and laws to eliminate homelessness and loitering, incorporating programming at the park to create activity that will discourage unhealthy elements, obtaining access to the restrooms at the WA Fruit Facility to encourage structured Parks & Recreation activity. Yet another discussion point is the desire of many for an Eastside pool to be located at Miller Park as it had been for many years. This topic deserves to be reviewed by a community committee to see if it is possible. Miller Park is one of the city's oldest and loveliest parks. It is honored and has a special place in the hearts of many people throughout the valley. It deserves the attention of this council, yet cannot be done without incorporating it into a full discussion of all the above issues and more. These are just a few of my thoughts that were generated when I received your email asking for direction on the GFI /YPAL /Miller Park. I hope they are helpful to you and others. Kathy