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HomeMy WebLinkAbout20B - AA - PAYMENT OC ANIMAL SHELTERREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: JANUARY 17, 2017 TITLE; AUTHORIZE PAYMENT TO THE COUNTY OF ORANGE FOR NEW ANIMAL SHELTER CONSTRUCTION (STRATEGIC PLAN GOAL NO. 1, 5) RECOMMENDED ACTION 10 A RaIN ► F P U1 I W*72 P IN APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 1" Reading ❑ Ordinance on 2 "d Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Approve an increase to the contract amount of the Participation Agreement approved by the County of Orange and the City of Santa Ana, increasing the amount by $727,768 for a new total contract amount of $7,869,145 (principal and interest). 2. Approve an Appropriation Adjustment appropriating $750,000 from fund balance (from Fiscal Year 2015 -16 General Fund), to pay for the first year payment of the County of Orange construction of the Animal Shelter. 3. Authorize payment of the term commencing July 1, 2016 through June 30, 2017 of principal and interest to the County of Orange for the City's share of the construction of the new animal shelter facility in the amount of $814,454.26. 4. Direct staff to request the County of Orange for an amended Participation Agreement that details the new terms and conditions resulting from the increased costs associated with the construction of the County Animal Shelter. DISCUSSION On January 6, 2003, the Council approved actions to transition the operation of the City's animal shelter and related services to the County of Orange Animal Shelter as a contracted service. At that time, City staff evaluated several options to provide animal care shelter services. It was determined that contracting with the Orange County Animal Shelter was the most cost effective means of providing quality service to the City. 20B -1 County of Orange Animal Shelter Participation Agreement Payment January 17, 2017 Page 2 On March 24, 2016, Orange County Community Resources (OC Community) notified the City Manager's Office of the County's decision to move forward with the construction of a new Animal Care Shelter. Given the conditions of the aging shelter, the County will be expediting the construction of the new facility with an expected completion date of Fall 2017. The new facility will be constructed over a 10 -acre parcel at the former Marine Corps Air Station Tustin Base for an estimated $35 million. The cost of the new facility will be shared amongst all participating cities. As such, on April 19, 2016, the City and County entered into a ten -year participation agreement to share the costs associated with the construction of the new animal shelter. The ten -year participation agreement covers the period of April 19, 2016 through July 1, 2026 and was estimated at a total cost of $7,141,377 (principal only). The action brought forth for council consideration on April 19, 2016 was an estimate of potential costs for each participating agency. However, on December 19, 2016, the City received a letter from the County of Orange indicating that the new cost to the City increased by $727,768. The following represents the City's pro -rata share: 1. Total Shelter Cost $27,300,000 2. Pro -rata percentage 27.68% 3. Total Principal Owed $ 7,555,497 4. Total Projected Interest $ 313,648 5. Total Project Cost $ 7,869,145 The County informed the City that the growth in costs was largely a growth in costs related to the construction of the Shelter as well as a lower than expected number of agencies (municipalities) participating in the project. The total interest estimate recently provided by the County is also included in this new total amount. Within the fiscal impact of the approved April 19, 2016 Council action, staff highlighted that funds for the FY 2016 -17 participation agreement payment would be allocated from the City's final balances and brought before Council in December upon certification of the City's FY 15 -16 audit. However the recent County invoice of December 19, 2016 increases the original payment estimate from $535,603 to $814,454.26. The First payment invoice now includes the period of July 1, 2016 through June 30, 2017. Prior to the Council Action dated, April 19, 2016, City Staff was advised by the OC Community Resources that payment due in fiscal year 2016 -17 would only be for the period October 1, 2016 through June 30, 2017. However, the City was notified on December 19, 2016 (Exhibit 1 & 2) that period July 1, 2016 through September 30, 2016 is also owed. Thus, the estimated amount owed for FY 2016 -17 increased $278,851.26 as a result of inclusion of the 1st quarter of the fiscal year (July 1, 2016 through September 30, 2016) and projected interest. The first installment in the amount of $377,774.86 is due and payable by January 31, 2017 and is subject to a ten percent penalty. Exhibits 1 & 2 20B -2 County of Orange Animal Shelter Participation Agreement Payment January 17, 2017 Page 3 STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal # 1 - Community Safety, Objective #5, (provide high quality Police and Fire /Emergency Medical Services response within the City of Santa Ana) FISCAL IMPACT Funding for the FY 2016 -17 payment for the period July 1, 2016 through June 30, 2017 totals $814,454.26. Authorization provides for the first quarterly and subsequent first year payments as follows: Approval of the Appropriation Adjustment will now designate $750,000 from Fiscal Year 2015 -16 General Fund ending fund balance to pay for the first year payment as follows: Animal Services - Contractual Services, 01114430 -62300 in the amount of $750,000. The remaining $64,454.26 is budgeted and available in the Police Department's Animal Services Account - Contractual Services, 01114430- 62300. Carlos Rojas - -- Chief of Police Santa Ana Police Department APPROVED AS TO FUNDS AND ACCOUNT: (� u Francisco Gutierrez �r Executive Director c� Finance and Management Services Agency Exhibit 1 - OC Community Resources 12/19/16 Correspondence Exhibit 2 - Payment Schedule 411W - r�- Occommunity esources b IR A 14 Ca E c o u N •r v EXHIBIT 1 Our Community, Our Comonitment. STEVE FRANKS DIRECTOR OC COMMUNITY RESOURCES JENNIFER HAWKINS, DVM DIRECTOR OC ANIMAL CARE RENEE RAMIREZ INTERIM DIRECTOR OC COMMUNITY SERVICES JULIA EIDWELL DIRECTOR HOUSING & COMMUNITY DEVELOPMENT &HOMELESS PREVENTION STACY DLACKWQDD DIRECTOR OC PARKS HELEN FRIED COUNTY LIBRARIAN OC PUBLIC LIBRARIES C A.t:lttnual 1... ulv 561 THE CITY DRIVE SOUTH ORANGE, 0492868 PHONE: 714,935M48 FAX: 714,935.6373 Y Dec. 19, 2016 City of Santa Ana 60 Civic Center Plaza Santa Ana, CA 92701 Attn: Robert Carroll RE; Participation Agreement (New Animal Shelter Invoice) Enclosed please find Invoice # A0179,002 9 In the amount of $377,77A.86 representing scheduled principal payments for the new animal shelter for quarters ending Sept. 30, 2016 and Dec. 31, 2016. Principal payments are based on the following; Total Maximum New Shelter Construction Cost $27,300,000 Santa Ana's Pro -rata Percentage 27.68% Total Principal $7,555,497 Quarterly Principal Payment (based on ten -year term) $188,887.43 Total Scheduled Principal for Sept. 30, 2016 and Dec. 31, 2016 $377,774.86 Please remit payment on,or before Jan. 31, 2017. Late payments maybe subject to a ten percent late payment penalty. The entire principal amount (plus accrued interest) may be paid in full at any time without penalty. Please contact Alan Young at 714 -796 -6411 to confirm a final payoff amount. Sincerely, A j Alan Y Budget Analyst Enclosure r1- �k�ORANGE COUNTY TREASURER -TAX COLLECTOR n SHARI L. FREIDENRICH, CPA P.0 BOX 4005, SANTA ANA, CA 92702 d• City of Santa Ana A17N: Robert Carroll 00 Clvlo Center Plaza Santa Ana, CA 92701 Pay Online AW W QWAYMM nt CDa1 IhVDICS A: AW90029 � -• _ Invoice pate: 01.01 -17 Aceount8: UNIT Agenc ; JOCCR �, ACCOUNTING CODE - �N�Y• —� —T I� Checkthlsboxlf IDGavernmout PUNb DEPT DUO UNIT Obyl SDby Dow SSA SUIT DEM' JOB NUMBER AMOUNT Agony CONYROL REV SROV DREV BSA BSA 361) 011 361) P413 7678 CZ336800 877,774.86 THISINVOICEPAEPARV0OY - -- ,W,�,_, PHONENUMBEq _ T0 NUMM OFSCRIPTION AMOUNT Now Animal Shelter Paymeat#1 i duly 2016 through September 2016 158,081.43 Payment #2: October 2010 through December 2016 188,887.43 TOTAL DUE 13Y 01.31 -2017 977,774.06 ....w.., ,,.,..- �.�- .....,........._. ^ -- Please detach original payment coupon. 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