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HomeMy WebLinkAbout11-17-1999 City Council Packet SARATOGA CITY COUNCIL EXECUTIVE SUMMARY NO. ~ ~ MEETING DATE: November 17,1999 ORIGINATING DEPT: Administrative Services DEPT. HEAD: AGENDA ITEM ~ l~ CITY MANAGER• ~' ~~'N'`~ SUBJECT: Monthly Treasurer's Report for July 1999 RECOMMENDED MOTION(S): Accept the monthly Treasurer's report for July 1999. REPORT SUMMARY: i"' ~- Generally, the Treasurer's report is provided to the City Council along with the financial reports. The City Council recently received the financial reports for the quarter ended September 30, 1999, and inadvertently the July Treasurer's report was not submitted along with the financial reports. It is submitted herewith. The City had $11,382,117 in cash and investments as of July 31, 1999. $9,801,161 was invested in the State of California Local Agency Investment Fund (LAIF), with the balance invested in Certificates of Deposit, checking and savings accounts. FISCAL IMPACTS: None ADVERTISING, NOTICING AND PUBLIC CONTACT: Nothing additional. CONSEQUENCES OF NOT ACTING ON RECOMMENDED MOTION(S): None. FOLLOW UP ACTIONS: Accept and file this report CITY OF SARATOGA ~ ~ A ~., ,~_ p~~~ Cash and Investment Report Cx~^~ v`im'( Balance as of July 31, 1999 Anticipated Acquisition FDR* Book Market Par Maturity Monthly Type Institation Date Rating Value Value** Vsine Yer1d Date Term Earrringa Unrestricted Cash & Investments: Cash: DD ComericaBank-Savings N/A AAA $158,853 $158,853 $158,853 2.300% Revolving L $304 CK Comerica Bank -General Checking N/A AAA 155,538 135,538 155,538 0.000% Revolving L 0 CK Comerica Bank -Payroll Checking N/A AAA 24,932 24,932 24,932 0.000% Revolving L 0 Stirbtotal Cash 339,323 a 339,323 339,323 1.077% 1 304 L.A.I.F. & Investments: MF L.A.LF. N/A N/A 9,801,161 b 9,788,397 9,801,161 5.178% Revolving 1 42,292 CD Saratoga National Bank 07/03/98 AAA 500,000 500,000 500,000 5.900% 07/03/99 365 2,458 CD Heritage Bank of Commerce 10/14/98 AAA 531,358 531,358 531,358 5.650% 10/14/99 365 2,502 Subtotal CDs 1,031,358 1,031,338 1,031,358 3.771% 730 4,960 Subtotal L.A.I.F. & Investments 10,832,519 10,819,733 10,832,519 5.241% 366 47,232 Subtotal Unrestrcted Cash & Investments 11,171,842 11,159,078 11,171,842 3.114% 183 47,557 Restricted Cash & Investments: SV Saratoga National Bank -CDBG N/A AAA 172,258 172,258 172,258 2.330% Revolving 1 363 ES US Bank -Library DeM Service N!A AAA 5,800 5,800 5,800 0.000% Revolving 1 0 CK Wells Fazgo Bank -CDBG N!A AAA 24,046 24,046 24,046 0.000% Revolving 1 0 CK We1lsFazgoBank-CDBG N/A AAA 8,171 8,171 8,171 0.000% Revolving 1 0 Subtotal Restricted Cash & Investments 210,275 210,273 210,275 0.173% 1 363 Total Cash and Investrnents Sil,~t~t,;ll7` Sl1«16`i3~... .. Sfi;3tl2,~iT:. 5.t15e3°~e. . Aug Xlel+~ :, 9~: : S47;A;IOf Benchmark Yield Comparison 3 Month Treasury 4.90% 6 Mouth Treasury 5.09% Schedule of Matnrifles: Reserve Analysis: General Fund Reserve requirement adopted 6/25/97: $2,000,000 Lnmediate $10,350,759 General Fund Balance as of 5/31/99 (Balances not available for 6/30/99 yet.) $6,028,738 FY 1999-2000 1,031,358 Available Fiords: Total $11,382,117 Unre~icted Pooled Cash & Investments available for current year expenses in all funds: $10,140,484 (Includes unrestricted funds maturing within the current fiscal year) Maturity General Fund Loan4 Receivable: Principal Rate Date Term Hakone Foundation # $204,521 6.500% 03/01/2004 3,650 NOTES: DD -Direct Deposits CK • Checking Account MF -Mutual Fund SV -Savings Account ES -Escrow Account * FDR =The Financial Directory rating is based on computer analysis of prime fmancials reported quarterly by the institutions to the Federal Reserve Board and the Federal Home Loan Bank Board. Ratings based on information released July 1998. **Market values for U.S. Treasury Notes provided by State Street Bank and Tnrst Company. # This loan is noted for memorandum purposes only. The loan is amortized per the agreement with the Hakone Foundation. No payments are received. This report reflects Pooled Cash, Investments and Restricted Cash which are available resources to fund operations, debt service and capital improvements. Other interest bearing assets (notes receivable) are listed above. Debt service reserve funds held by trustees are restricted pursuant to indenture covenants and have been excluded from this report. Pursuant to Government Code Section 53646, the City's investment portfolio is in compliance with the adopted investment policy and there are adequate resources to meet anticipated pool expenditure requiremerrts for the next six months. ~~/ ~ ~~ ~t'~~ Il ID ~ Submitted by Approved by: ~ 11/10/99 o:4epord(mmyon'P~ (Unaudited Results) SARATOGA CITY COUNCIL EXECUTIVE SUMMARY NO. 3Z ~ Z_ MEETING DATE: November 17, 1999 ORIGINATING DEPT.: City Manager AGENDA ITEM CITY MANAGER: i; . DEPT. HEAD: SUBJECT: Ratification of Letter of Understanding between City and Saratoga Management Organization RECOMMENDED MOTION(S): Move to adopt the Resolution ratifying the Letter of Understanding between the City and the Saratoga Management Organization for the period ending June 30, 2001. REPORT SUMMARY: The attached Resolution, if adopted, will ratify a new Letter of Understanding between the City and the Saratoga Management Organization for a two year period ending June 30, 2001. The LOU attached to the Resolution reflects all of the changes agreed to during the recent negotiations between the City and SMO. The most substantive of these are the new salary ranges for management employees, and the modified rating categories for annual performance appraisals. FISCAL IMPACTS: There are none directly as a result of ratifying the new LOU. No additional benefits have been extended to SMO and none have been eliminated. The adopted budget contains sufficient funding for the expected total compensation for the management employees during the term of the LOU. ADVERTISING, NOTICING AND PUBLIC CONTACT: Nothing additional. CONSEQUENCES OF NOT ACTING ON RECOMMENDED MOTION(S): The Resolution would not be adopted and the LOU would not be ratified. Presumably this would lead to further negotiations between the City and SMO. FOLLOW UP ACTIONS: The LOU will be signed and distributed. ATTACHMENTS: Resolution with LOU attached. RESOLUTION N0.85-9. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SARATOGA RATIFYING A LETTER OF UNDERSTANDING BETWEEN THE CITY AND THE SARATOGA MANAGEMENT ORGANIZATION AND AMENDING RESOLUTION N0.85-9.115 SETTING MANAGEMENT SALARY RANGES FOR FISCAL YEARS 1999!00 AND 2000!01 WHEREAS, the City of Saratoga, through its designated representatives and pursuant to State law, has met and conferred with the organized representative organization, the Saratoga Management Organization (SMO), concerning proposals for modifications and changes'to salaries, benefits and other matters; and WHEREAS,. the representatives of the City and the SMO have reached an understanding regarding changes in salaries, benefits and other matters for the period beginning July 1, 1999, for employees represented by SMO, all of which are specified in a Letter of Unders~anding which is attached hereto as Exhibit "A"; and WHEREAS, this Resolution amends various Resolutions of the City of Saratoga. This Resolution is an expression of existing policy of the City of Saratoga and is subject to modification and change by the City Council from time to time. Nothing herein contained shall be construed as creating or establishing any of the provisions hereof as terms of any contract of employment extending beyond a period other than such period as during this Resolution is in full force and effect. That is to say, that any employee of the City of Saratoga during the effective period of this Resolution shall have such employment rights and duties as set forth herein only during such period of time as this Resolution remains in effect, and not afterward. NOW, THEREFORE, BE IT RESOLVED that the terms and conditions of the Letter of Understanding, dated , 1999, are hereby approved. The above and foregoing Resolution was passed and adopted at a regular meeting of the City Council of Saratoga held on the day of , 1999, by the following vote: AYES: NOES: ABSENT: ABSTAIN: MAYOR ATTEST: CITY CLERK EXHIBIT "A" Letter of Understanding Between the City of Saratoga (hereinafter "CITY") And The Saratoga Management Organization (hereinafter "SMO"). 1. Term. This Letter of Understanding sets forth the understanding of the parties for the period beginning July 1, 1999 and continuing through June 30, 2001, at which time the Letter of Understanding terminates. 2. Salary Ranges. Through the period ending June 30, 2001, it is agreed that the top of the salary ranges for management employees shall be determined by a market survey of department head positions made up of 12 cities which averages the six closest both above and. below Saratoga in terms of population as reported by the most recently published State Department of Finance Report and the six both above and below Saratoga in terms of total revenue as reported in the most recently published Annual State Controller's Report, including the Cities of Campbell, Los Altos and Town of Los Gatos, all to be within the counties of Santa Clara, San Mateo, Contra Costa and Alameda. When conducting the market survey, the City will endeavor to determine salaries of comparable management positions, reporting directly to the City Manager, in the cities surveyed. The top of each salary range shall be set in accordance with the above methodology and the bottom of each salary range shall be 35% below the top of each range. Notwithstanding the above, it is agreed that effective July 1, 1999, the salary range for each position shall be as follows: Public Works Director $5,805 - $7,837 per month Community Development Director $5,805 - $7,837 per month Administrative Services Director $5,805 - $7,837 per month Recreation Director $5,224 - $7,053 per month In future years, the market survey described above shall be performed every two years to coincide with the beginning of the period covered under a subsequent Letter of Understanding. 3. Benefits, Leave and Retirement. The members of SMO shall be entitled to the same employee benefits as other Saratoga employees who are represented by the Saratoga Employees Association (SEA), as detailed in sections XIII, XIV, and XV of the Memorandum of Understanding dated July 1, 1999 between the City of Saratoga and SEA. The members of SMO shall continue to receive the $350 monthly expense allowance that is used for education, training, professional development, business related travel costs, and miscellaneous business expenses. SMO members shall also continue to receive life insurance coverage at two times annual salary, up to a maximum coverage of $150,000. ~, 4. Review and Appraisal. EXHIBIT "A" All SMO members will be reviewed on their anniversary date. Salary adjustments shall be made based upon performance appraisal. Overall performance will be judged as below standard, standard, above standard or exceptional. If a below standard appraisal is given, another review will be conducted in three months. A total of two successive below standard appraisals shall be grounds for dismissal. These reviews are in addition to any scheduled review period. All appraisals will be in writing and be signed by both the City Manager and the manager being reviewed. 5. Compensation for Performance. Salary adjustments for annual appraisal reviews shall be made in good faith and be based on the following schedule: Below Standard Performance: a reduction in salary of up to 2%. Standard Performance: a salary increase of CPI plus up to 3%. Above Standard Performance: a salary increase of CPI plus up to 6%. Exceptional Performance: a salary increase of CPI plus up to 8%. For purposes of this Agreement, CPI shall be defined as the Consumer Price Index published by the US Department of Labor Bureau of Labor Statistics for the San Francisco-Oakland-San Jose regional area for Urban Wage Earners and Clerical Workers which is published bimonthly. The CPI to be used shall be the one most recently published prior to each manager's anniversary date. New management employees shall be evaluated after six months and after one year of service. During the first six month review period, the salary adjustment shall be one-half the normal adjustment for an appraisal rated satisfactory or above. 6. Administrative Leave. CITY shall grant management employees, on a fiscal year basis, five days of administrative leave. Such leave shall be taken only under the following conditions: a. No more than one day of administrative leave may be taken at one time. b. Administrative leave shall not be taken in conjunction with any vacation period. c. Permission to take administrative leave shall be granted in advance by the City Manager or the Acting City Manager in the absence of the City Manager. d. Any administrative leave not taken by the end of the fiscal year cannot be carried over to any future fiscal year. e. Administrative leave may only be used in half-day or full-day increments. 7. Implementation. CITY agrees to recommend the above understanding to the City Council for ratification. Following such ratification, implementation shall be by Resolution of the City Council. EXHIBIT "A" AGREED ON BEHALF OF THE CITY OF SARATOGA: Larry I. Perlin, City Manager Date AGREED ON BEHALF OF THE SARATOGA MANAGEMENT ORGANIZATION: President Date \.r ti.: SARATOGA CITY COUNCIL EXECUTIVE SUMMARY NO. AGENDA ITEM (3 A + B MEETING DATE November 17, 1999 CITY MANAGER: ORIGINATING DEPT. City Manager PREPARED BY: Library Comm. SUBJECT: Joint Meeting with Library Commission RECOMMENDED MOTION(S): REPORT SUMMARY: Attached are reports from the Library Commission regarding items 13A and B. FISCAL IMPACTS: N/A ADVERTISING, NOTICING AND PUBLIC CONTACT: N/A CONSEQUENCES OF NOT ACTING ON RECOMMENDED MOTION(S): N/A FOLLOW UP ACTIONS: N/A ATTACHMENTS: as stated • LIBRARY 2020 Saratoga Community Library Needs Assessment , SARATOGA C .O .M .M .U . N .I .T .Y LIBRARY # 3 �� • • • Updated 1999 Saratoga Community Library Commission Marcia Manzo, Chair Bobby Chandra Anne Cross Cathy Foscato (Monte Sereno) Ruth Gipstein Cici O'Donnell Sally Towse 1999 Saratoga Community Library Commission Needs Assessment Update Saratoga Library Commission confirms the work done in 1991 and 1996 by previous commissions and citizen committees. They endorse the 1991 Building Plan, with augmentations based on an updated Needs Assessment and they project library needs in the Saratoga community to the year 2020, rather than 2005. In formulating this assessment, a coalition of commissioners and Friends solicited community suggestions about library needs, and considered critical points about the development of library service. Citizen Priorities • More reference materials, books and periodicals • Space for more books • Quiet Study/Reading Rooms • Rewiring to improve public access to computers and the Internet • • More reading and after-school programs for kids • Improved access to fire and safety systems • Adequate seating • Replacement of outdated lighting systems • Improved access for people with disabilities Critical Points • In 1991, the estimated monthly circulation for the year 2005 was 45,000 items. In actuality, by the spring of 1999, 79,000 items were circulated per month. At the current rate of increase, monthly circulation in 2005 could reach over 100,000 per month. • With approximately 175,000 items in the collection, 45%of all library materials are checked out each month. • The amount of staff workspace needed (room to receive, sort, process and re-shelve materials)has direct correlation to the increased library usage. Lack of adequate work space has a dramatic effect on staff efficiency and our ability to serve the public in the manner they deserve. • Over 1,100 people now visit daily. More chairs,table space and physical space are needed when patron visits increase. Confined space results in elevated noise levels, inadequate facilities and a negative impact on Library services. • Summary The Saratoga Library has been a victim of its own success. A library that was originally designed for 100,000 volumes now houses 175,140 volumes, despite routine discards. Because new shelving has been added to accommodate the growth in the collection and there are not enough places for patrons to sit or to browse comfortably. This is especially true in the afternoon when children and students from nearby schools are in heavy attendance. A citizens planning process for expansion was begun in 1991 and continued in 1996 and 1998. Our Saratoga Community Library only continues to be more popular. Checkouts grew to 918,317 in the recently concluded fiscal year, almost tripled in 15 years. And, it's part of a well-managed system, rated one of the best in the country by American Libraries' Hennen Index. This report includes a listing of citizen priorities, background information on the process, background information on the needs, and information on our recent community awareness program, led by a coalition composed of the Friends of the Saratoga Libraries, library commissioners, and the Saratoga Community Library Foundation. Background 1991 The Saratoga Community Library Commission in 1991 recognized the need to expand the library facility. The Commission drafted and presented to the City Council a Needs Assessment which was accepted by the Council. The Council then appointed an Expansion Committee, which interviewed and selected an architect. City funding allocations for in-depth architectural drawings were never made as State funds to libraries were dramatically cut in 1991. The project was suspended. 1996 Update Based on increased usage and the overwhelming support for Measure A in 1994, it is clear the community wants and needs a library that can meet its demands both physically and technologically. Therefore, in 1996,the Saratoga Community Library Commission reviewed the 1991 Needs Assessment. The results of the 1991 study continued to be true. The Commission requested that Friends of the Saratoga Libraries fund a poll to ask Saratogans whether they would favor a bond measure to support library renovation and expansion. The 1997 poll disclosed that while "maintaining library services"rated as one of the top civic issues, the public needed more information about library needs. 1998 Rohlf Report In response to this poll, the Commission requested staff to study the use of current available space. The County Library hired Library Consultant Robert Rohlf to analyze space allocation at the Saratoga Community Library. His 1998 report confirmed the Commission and staff assessments of"extremely crowded conditions." He concluded that the major solution to the space problem was to expand. "You cannot overload a building to the extent occurring in Saratoga and find an easy solution to the problem." Community Awareness Program and 1999 Poll With this consultant's report in hand, the Commission joined with the Friends and the Foundation in a"Library Awareness" effort to acquaint the community with the need for library renovation and expansion. A new poll in summer 1999 demonstrated that their efforts from fall 1998 to date had improved the level of awareness that Saratogans had about expansion needs. However, citizens still needed more information about renovation needs, and a communications program was implemented to solicit input and reinforce key messages. Current Unmet Needs The current building is an 18,000 square foot facility. According to accepted national library standards, a library offering our current level of service should be in a facility of 35,000 square feet. • More space is needed to accommodate the current collection of over 175,000 items and to make access compliant with the Americans with Disabilities Act. • Minimum seating standards dictate 3 seats per 1,000 population, which would be 114 seats. Currently the library has 84 seats, less than the 96 seats available in 1991. • The library should have at least 30 computer stations for every 1000 visitors, about 33 stations. Currently only 27 are available. • The story room area, which was in the Children's Room in 1996, was eliminated to make room for shelves. • The lobby and public information area was reduced to accommodate shelving for audio-visual materials. • Current loading and utility areas are too small. • Again, national library standards show that our facility is nearly half the size it should be for a library of its scope and usage. Needs in 2020 Extrapolating from current usage and using nationally recognized standards, we arrive at the following conclusions: • Saratoga residents have a high educational level and sophisticated expectations of library service. Ideally Saratoga should have a collection of 239,700 volumes (including magazines.) Currently one item has to be discarded for every item that is added to the collection; it would only take three or four years to reach 239,700 volumes. • We need at least 160 seats, including a quiet study room. • Due to demand, 45 computer stations would be needed to provide more access than the 27 currently available. • A technology training center which would provide computer-training facilities for both staff and public. • A larger story room that can accommodate 125 children for programs • Adequate checkout areas to accommodate increasing numbers of items being held for patrons and to reduce the wait in line. • Renovations to improve lighting, disabled access and safety exits. Space Allocation Comparisons Of Saratoga Library Building Needs National library standards were used to calculate collection space,seating,computer stations and unassignable space. Current 1999 Standards 2020 Minimal 2020 Adequate Current space-- Space needed now Population growh & Population growh & does not meet for current activity& minimal increase in adequate increase in national library use, meeting resources/capita: resources/capita: standards national library 39-43,000 square ft. 46-49,000 square ft. standards square feet square feet square feet square feet Collection 7,034 12,000 16,100 19,200 (4.65 items/capita) (4.65 items/capita) (5 items/capita) (6 items/capita) Seating 1,288 3,420 3,600 4,800 (84 seats) (114 seats) (120 seats) (160 seats) Computers: 825 1,485 1,620 2,025 Public Access (27 stations) (33 stations) (36 stations) 45 stations) Tech Training Ctr N/A N/A (7 stations) (7 stations) Reference Area 1,020 1,020 1,475 1,475 Story room 0 1,250 1,450 1,450 Community room 1,200 1,200 1,700 1,700 Community service 1,051 1,141 1,500 1,500 Circulation desk 640 750 750 750 Work space 1,048 4,005 4,980 4,980 Lunchroom/lockers 205 400 500 550 Storage 26 252 252 252 Net square feet 14,337 26,923 34,277 39,032 Unassignable 3,663 8,077 8,723 9,968 (20-30% of gross) Total 18,000 35,000 43,000 49,000 Saratoga Expansion 2020 Minimal: 39,000-43,000 sq. feet $3,700,000 renovation of existing 18,000 sq. ft. $7,800,000 building 21-23,000 new sq. ft. @ approx. $338/sq. ft. $11,500,000 Total Collection: 199,750=5 items per capita Seating: 120=3 per 1000 population Public computer stations: 36+7 in training center 2020 Adequate: 46,000-49,000 sq. feet $3,700,000 renovation of existing 18,000 sq. ft. $10,300,000 building 28-31,000 new sq. ft. @ approx. $338/sq. ft. $14,000,000 Total Collection: 239,700=6 items per capita Seating: 160=4 per 1000 population Public computer stations: 45+7 in training center Cost Projections: Above totals include all costs: building and renovation as well as professional fees, furniture/shelving, and equipment. Meeting this low cost will require reuse of all existing library furnishings and shelving. These preliminary financial projections are based on figures from David Langdon Adamson for a May 1999 Cupertino conceptual plan. Demographic Projection (ABAG) 2020 Population: 39,950 Current Population: 37,679 Collection: 175,140 =4.65 items per capita Seating: 84=2.23 per 1000 population Size: 18,888 sq.ft. Library Fact Sheet Saratoga Community Library 13650 Saratoga Avenue Saratoga, CA 95070-5099 Operated by: Santa Clara County Library, rated one of the best in the nation in 1999 Building: Owned by the City of Saratoga Opened: February 1, 1978 Size: 181,000 square feet Volumes: 175,140 (including magazines) Hours Open: 58 hours per week Summer Sundays (4 hours) funded by the Friends of the Saratoga Libraries Staff: 23 full time equivalent Circulation: 918,317 per year Reference Questions Answered: 56,996 per year Patron visits: 370,527 per year SARATOGA CITY COUNCIL MEETING DATE: November 17, 1999 ORIGINATING COMMISSION: Saratoga Community Library Commission SUBJECT: Saratoga Community Library Bond Measure RECOMMENDATIONS: (1) The Saratoga Community Library Commission unanimously recommends that the Mayor and City Council vote to place a General Obligation(GO) Bond in the amount of$14 million on the March 7, 2000 ballot, and that the City forward a resolution to this effect prepared by its bond counsel for receipt by the Elections Office of the Santa Clara County Registrar of Voters no later than 5:00 p.m. on Friday, December 10, 1999. (2) The Saratoga Community Library Commission unanimously recommends that the City forward the following proposed ballot question language to its bond counsel for review and approval: "To improve,renovate,and expand the Saratoga Community Library in its current location by providing space for more books; ensuring modern earthquake standards;improving access to fire exits; updating electrical wiring for computers; providing adequate seating;updating inadequate lighting;and providing additional space for children's reading areas, shall the City issue$14 million in bonds at the lowest interest rates possible with guaranteed annual audits,a citizens oversight committee, and no money for administrator's salaries?" (3) The Saratoga Community Library Commission unanimously recommends that the GO Bond be structured so the cost per$100,000 of assessed(not market) valuation is the lowest responsible amount per year. L. REPORT SUMMARY: For the past decade, a coalition of citizens,Library Commissioners,Friends of the Saratoga Libraries, and members of the Saratoga Community Library Foundation have been engaged in a facilities planning effort to improve,expand and renovate our Saratoga Community Library. During this time,three different Library Commissions have drafted three Needs Assessments for the Library. The first is the most complete document,the subsequent two have updated the vital statistics concerning use and size of the collection, recommendations for improvements to the facility as well as citizen input. The most significant item of change is the "Circulation"statistics(number of items checked out). These "Circulation"statistics seemingly have debunked the notion that libraries will become smaller, less used, house less books and other media because of the access to information over the Internet. Library check outs in Saratoga have increased 68% during the past five years, and this is a Nationwide trend. It would seem that the increased access to information via the Internet has spawned a society that seeks even greater library contact and usage. Robert Rohlf,the Library Space Consultant who surveyed the Saratoga Community in 1996 suggested that"Your building or facility needs to be,at an absolute minimum, 40,000 SF and I would suggest it should be much larger than that. You could easily expand three times not two times for the kind of use you have." He concluded his remarks with"To continue to use the current space, the collection must be severely weeded. You need to grossly expand the building or settle for a library that is second best or maybe third or fourth best." The number one concern of citizens is space for"more books and materials". By current National Library Standards, a collection the size of Saratoga's should be housed in a 35,000 SF building. Expanding to the levels recommended by the 1991 Commission (36,360 SF) or the 1997 Commission (40,000 SF), although a great improvement, would provide only minimal room for future growth.. The citizens of Saratoga have given us their number one priority for their library,they want a larger collection, and have said: "Expand the building for future growth." To expand at the earlier Commission recommendations would either mean choosing to not grow the collection, or expanding the collection and be operating in a desperately crowded facility within ten years. A professional baseline poll commissioned this summer showed significant awareness and support for library expansion, but less awareness of library renovation needs. The baseline poll showed that with additional community outreach,a two-thirds support rate was possible. The Friends of the Saratoga Libraries subsequently funded and implemented a "Community Awareness Program" to increase public awareness and solicit input about library needs. Four informational mailers were sent to residents, a successful "one-on-one" outreach program was implemented, and two mailers were sent to opinion leaders. In all, nearly 1,300 responses were received by citizens. An overwhelming number were supportive of the library improvement effort and a bond. Last week, a professional "tracking poll" was conducted to gauge the level of support for a March 7,2000 library facilities bond. This poll showed that Saratogans would support a $14 million GO Bond at a two-thirds margin, at a projected cost of approximately $10 per $100,000 of assessed,not market valuation,per year(a cost estimate previously provided by the City Manager's Office). It is important to note that the accuracy of the tracking poll is based on the draft ballot language as contained in this Commission report. This draft ballot language was prepared in consultation with professionals who had experience in similar jurisdictions. Significant deviation from this ballot language will affect the accuracy of the poll, and potentially the ability to be successful in the outcome of our library bond election. (/ _Marcia M. Manzo, Chair �/� . •!1 Anne Cross,Vice Chair .4F ' Mitre& BobbiefrChandra Cathy Foscato,Monte Sereno Representative Ruth Gipstein (1)076.46,e_e_t CiCi O'Donnell e Sally Tow se ....... SARATOGA COMMUNITY LI BRARY fli: Ile 544414 1,444 P.O. Box 2642 Saratoga, California 95070-0642 November 12, 1999 The Honorable City Council City of Saratoga 13777 Fruitvale Avenue Saratoga, California 95070 Dear Council Members: The f44444 54444.14 W.146 enthusiastically endorses the Saratoga Library Commission's recommendation that the Saratoga City Council place a $14 million General Obligation Bond on the March 7, 2000 ballot for the purpose of expanding and renovating the Saratoga Community Library. We also urge the City Council to approve the lowest possible, responsible tax rate per$100,000 assessed valuation. The F4.ask Board of Directors has carefully evaluated the needs of the Library. Much has been said and written about the present inadequacies. Its size is the root cause of most of its problems. These problems will be exacerbated as the Library continues its anticipated growth. The only solution is to expand and renovate the present facility. For nearly six months, the Fiftts have worked in concert with the Saratoga Library Commission and the Saratoga Community Library Foundation to inform voters about important library needs. After several interactive written communications to over 7,000 Saratoga households and hundreds of "one-on-one" visits with individual residents, we believe that Saratogans recognize the urgency of solving the library's needs and will, in sufficient numbers, support a Library Bond Measure. A recently conducted professional tracking poll confirms this belief. We urge you to place a $14 million General Obligation Bond on the March 7, 2000 ballot. Sincerely, f vie 5.144141.444444.4 William J. McDonnal, President SARATOGA CITY COUNCIL EXECUTIVE SUMMARY NO. ~ ~ ~ ~ AGENDA ITEM 13 C MEETING DATE: November 17,1999 CITY MANAGER: ORIGINATING DEPT: Administrative Services DEPT. HEAD:'/G SUBJECT: Resolution Determining that the Public Interest and Necessity Demand the Acquisition, Construction and Completion of Certain Municipal Improvements and their Financing Through the Issuance of General Obligation Bonds RECOMMENDED MOTION(S): Adopt the attached Resolution determining that the public interest and necessity demand the expansion and remodeling of the Saratoga Library and its financing through the issuance of General Obligation bonds. REPORT SUMMARY: Should the City Council determine that it wishes to move forward with the issuance of General Obligation bonds to remodel and expand the Saratoga Library, it is necessary to take the following legal actions before December 10, (which is the final date that Santa Clara County will accept the required documents calling for an election on the March 7, 2000, ballot): 1) Resolution determining that the public interest and necessity demand the expansion and remodeling of the Saratoga Library and its financing through the issuance of General Obligation bonds, 2) First reading of an Ordinance calling for a special election to issue General Obligation bonds, and 3) Second reading of the above Ordinance. The first step (adoption of the attached Resolution of Determination) simply makes a finding that there is a public necessity which demands the expansion and remodeling of the Saratoga Library, and that it will be financed through the issuance of General Obligation bonds. Pursuant to California Government Code section 43607, "proceedings for the issuance of General Obligation bonds are initiated when the City legislative body passes a by atwo-thirds vote of all its members determining that the public interest or necessity demands the acquisition, construction or completion of any municipal improvement." The second step is the introduction of an Ordinance calling for a special election to issue General Obligation bonds. The Ordinance also defines the language that will be used on the ballot. The third step is simply the second reading of the same Ordinance. FINANCING STRUCTURE: It is clear that the best financing mechanism for the expansion and remodeling of the Saratoga Library is to issue General Obligation bonds. General Obligation bonds will garner the lowest interest rate of all the available financing alternatives because they are backed by the "full faith and credit" of the City of Saratoga, and do not require that a reserve fund be set aside for the life of the bonds, thereby bypassing the requirement that funds be tied up in reserve for twenty or thirty years. They are also the most traditional type of bonds, and therefore desirable in the financial marketplace. General Obligation bonds are tied to the assessed valuation of real property in Saratoga. The issuance of these bonds carries with it a minimal increase in property taxes above the statutory 1 % rate of assessed valuation. This annual increase in property tax is what the City uses to make the annual debt service payments. When the bonds are paid off, property tax rates return to the level they were before the issuance of the bonds. The California Government Code allows cities to issue bonds for up to forty years, but generally speaking, bonds are issued for periods between twenty and thirty years. Similar to a home mortgage, the longer the life of the bonds, the lower the annual debt service payments, but the higher the total cost of borrowing funds over the life of the debt. The total amount needed to fund the project must be decided before the specific structure of the bonds can be determined and a tax levy can be estimated. Note that the attached resolution indicates in Section 2 that the estimated cost of the project is not to exceed $15 million. At this time, it is not known what project amount the City Council may approve, so an upper limit was used to allow maximum flexibility. It would be entirely appropriate, however, for the City Council to stipulate a more exact amount when approving the resolution. For discussion purposes, however, assuming thirty-year General Obligation bonds of $11.5 million, the increase in property taxes would be approximately $10 per year on each $100,000 of assessed valuation. Depending on the structure, the first year could be higher and taper down to a lower rate in the last year. Other factors include the life of the bonds and the interest rate at which the City is able to sell them. If the City Council approves this project and the Saratoga electorate approves the issuance of debt, the bonds will be sold competitively. The City will then work with the investment banking (underwriting) firm which offers the lowest interest rate to sell the bonds and finance the project. C: I Mary JolLibrarylResoRpt. doc 2 PROPOSED SCHEDULE OF ACTIONS: Staff recommends the following schedule for the required legislative actions: Resolution of Determination November 17 Regular Meeting Introduction of Ordinance Calling for Election December 1 Regular Meeting Second reading of Ordinance Calling for Election December 7 Adjourned Meeting As an alternative, the City Council could decide to defer the adoption of this Resolution until the December 1, 1999, regular meeting, and consider it at the time of the introduction of the Ordinance Calling for an Election. A second alternative is to adjourn the November 17 meeting to November 22 or 23, and use the adjourned meeting in lieu of one of the December meetings. Please note that atwo-thirds vote of all City Council members (four votes) is required for the Resolution and Ordinance to become effective. FISCAL IMPACTS: There are no immediate fiscal impacts of adopting this Resolution. It could lead, however, to the issuance of General Obligation bonds. ADVERTISING, NOTICING AND PUBLIC CONTACT: Nothing additional. ALTERNATIVE COURSES OF ACTION: The City Council could decide to defer the adoption of this Resolution until the December 1 regular meeting or to an earlier adjourned meeting, and consider it at the time of the introduction of the Ordinance. CONSEQUENCES OF NOT ACTING ON RECOMMENDED MOTION(S): None, if the City Council decides to defer the adoption of the Resolution until December 1 or earlier. However, the Resolution does need to be adopted by December 1. If not, it would be impossible to meet the deadline for the March 7, 2000 election. FOLLOW UP ACTIONS: Return no later than December 1, 1999, with the introduction of the Ordinance calling for a special election, and possibly return on or before December 1 with this Resolution of Determination if it is not adopted on November 17. ATTACHMENTS: Resolution of Determination C: IMary Jo ILibrarylResoRpt. doc 3 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SARATOGA DETERMINING THAT THE PUBLIC INTEREST AND NECESSITY DEMAND THE ACQUISITION, CONSTRUCTION AND COMPLETION OF CERTAIN MUNICIPAL IMPROVEMENTS AND THEIR FINANCING THROUGH THE ISSUANCE OF GENERAL OBLIGATION BONDS BE IT RESOLVED, by the City Council of the City of Saratoga, California (the "City") that: WHEREAS, the City is authorized to issue general obligation bonds to finance municipal improvements pursuant to the provisions of Article 1, commencing with section 43600, of Chapter 4 of Division 4 of Title 4 of the California Government Code or, in the alternative, pursuant to Article 4.5, commencing with section 53506, of Chapter 3 of Part 1 of Division 2 of Title 5 of the California Government Code (the "Act"); WHEREAS, the City intends to issue general obligation bonds under and pursuant to the Act to finance the expansion and remodeling of the Saratoga Library (the "Improvements"); and WHEREAS, in order to initiate proceedings under the Act to provide for the financing of the Improvements, this Council must make certain findings and determinations; NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Saratoga as follows: Section 1. The public interest and necessity demand, and it is the intention of this Council to require the acquisition, construction and completion of the Improvements and to issue general obligation bonds of the City to finance the cost thereof, subject to completion of the proceedings required by the Act. Section 2. The estimated cost of the Improvements is not to exceed fifteen million dollars ($15,000,000). Said estimated costs include provision for legal and other fees, and the cost of printing of bonds and other costs and expenses incidental to or connected with the issuance and sale of general obligation bonds to finance the costs of the Improvements. Sectian 3. This Council hereby finds and determines that the costs of the Improvements require an expenditure by the City greater than the amount allowed for it by the annual tax levy of the City. The principal amount of general obligation bonds of the City to be issued for the Improvements will not exceed the estimated cost set forth above for the Improvements. Section 4. This resolution is adopted, and general obligation bonds of the City are to be issued, pursuant to the Act. Section 5. This resolution shall take effect upon its adoption by two-thirds of all members of the City Council of the City of Saratoga. -1- The above and foregoing resolution was passed and adopted at a regular meeting of the Saratoga City Council held on the 17th day of November,1999, by the following vote: AYES: NOES: ABSENT: ABSTAIN: Mayor ATTEST: City Clerk -2- r SARATOGA CITY COUNCIL EXECUTIVE SUMMARY NO. J ~ ~ '"( AGENDA ITEM MEETING DATE: November 17,1999 CITY MANAGER: , ORIGINATING DEPT: Administrative Services DEPT. HEAD: SUBJECT: Recommendation for Selection of Bond Counsel for the Possible General Obligation Bond Election RECOMMENDED MOTION(S): Authorize the City Manager to execute a standard professional services agreement for fees not to exceed $30,000 with Quint and Thimmig as bond counsel to assist the City of Saratoga with the potential issuance of debt for the renovation and expansion of the Saratoga Library. REPORT SUMMARY: The City of Sartoga Library Commission and the Friends of the Saratoga Libraries may be making a recommendation to the City Council to call a special election seeking voter approval to issue bonds for the remodeling and expansion of the Saratoga Library. For this project to move forward in accordance with the proposed timeline previously presented, the issuance of debt would require voter approval in the March 2000 election. A March election would require an extensive list of legally required documents to be processed in a very short time, including a City Council resolution requesting an election, and an ordinance including the language for the ballot measure to be presented to the County Registrar's Office by December 10, 1999. In preparation for the possibility that the City Council may approve this project to proceed, staff is assembling a financing team to advise and assist the City throughout this very complex process. On November 3, the City Council appointed the firm of Evensen Dodge Inc. as financial advisor. The City must also hire bond counsel as quickly as possible to join the core financing team. Staff recommends that the firm of Quint & Thimmig of San Francisco be appointed. Over the past several weeks, staff developed a list of experienced and highly regarded bond counsel firms. The following four firms were invited to interview with the City Manager, the City Attorney, and the Administrative Services Director: Firm Jones Hall Quint & Thimmig Stradling Yocca Carlson & Rauth Orrick, Herrington & Sutcliffe Personnel William Madison and Charles Adams Brian Quint , David Casnocha and James Roth John Hartenstein and Mary Collins All four f rms were asked to provide written materials regarding their firm and personnel, comment on the proposed timeline, provide an opinion regarding alternative funding structures, and make an oral presentation. The firms were evaluated based upon the following criteria: General bond counsel experience Specific experience with issuing General Obligation bonds Use of a team approach with at least two professionals assigned to the City's project Presence of a local (Bay Area) office with at least one team member located in it Communication skills Accessibility, responsiveness and timeliness Knowledge and experience in the community Quality of oral presentation made to City staff Quality of written proposal Fee structure Ability to work on contingency basis (fees and costs contingent upon sale of bonds) After careful review, staff recommends that the firm of Quint & Thimmig be awarded the bond counsel contract. The firm is a leader in the industry, and the partner who would be working on the City's project has extensive experience with General Obligation bond issuance. The firm's office is located in San Francisco, and has a reputation for being highly accessible and responsive, which was demonstrated during the selection process. Quint & Thimmig's fee is presented as a range, assuming a bond issue between $9 and $14 million. If the City issues bonds as low as $9 million, the fee is $25,000; if the City issues bonds as high as $14 million, the fee is $30,000. For issues between $9 and $14 million, the fee will be between $25,000 and $30,000 on a proportionate basis. Fora $14 million bond, Quint & Thirnmig's fee is among the lowest fee quoted, but could be even lower should the City Council approve a smaller bond issue. The firm would also charge out-of-pocket costs for an amount not to exceed $2,500. Please note that it is industry practice for bond counsel to work on a contingency basis. In other words, their fee and out-of-pocket costs are contingent upon the sale of the bonds. If the City Council decides not to proceed with the bond sale, or if the Saratoga electorate votes it down in March, the City would only be billed for minimal out-of-pocket costs. Also note that if bonds are ultimately issued, Quint & Thimmigs's fee plus out-of-pocket costs would be paid from the bond proceeds at the time the bonds are sold. C: (Mary JolLibrarylLibraryBC.doc 2 FISCAL IMPACTS: The fiscal impact to the City if the bonds are sold would not exceed $32,500 ($30,000 for fees and $2,500 for costs). If the bonds are not sold, the fiscal impact would be nothing. ADVERTISING, NOTICING AND PUBLIC CONTACT: Nothing additional. CONSEQUENCES OF NOT ACTING ON RECOMMENDED MOTION(S): If bond counsel is not selected at this time, it would be impossible to meet the deadlines for the March 2000 election. The City would be required to delay the vote to a later election. FOLLOW UP ACTIONS: Execute agreement with Quint and Thimmig. ATTACHMENTS: Bond Counsel Rating Sheet Quint & Thimmig Scope of Services C: IMary JolLibrarylLibraryBC.doc 3 CITY OF SARATOGA EVALUATION OF BOND COUNSEL FIRMS LIBRARY GENERAL OBLIGATION BONDS Jones Hall General experience Specific experience in GO bonds Team approach Local office Communication skills Accessible, responsive and timely Knowledge of community Oral presentation Written proposal Fee structure Bond counsel and disclosure fee Out-of-pocket (not to exceed) Contingent fees Bond counsel and disclosure fee Out-of-pocket costs Quint & Stradling Orrick Thimmig Yocca Herrington Excellent Yes Yes Yes Excellent Good Good Excellent Excellent Excellent Excellent Yes Yes No Yes Yes Yes Excellent Good Excellent Good Good Excellent Excellent Good Excellent Excellent Excellent Yes Yes Yes Good Excellent Good Good Excellent $30,000 $25,000-30,000 $33,500 $2,500 $2,500 $2,500 $45,000 $0 Yes Yes Yes Yes Yes Yes Yes n/a C: IMary JolLibrarylLibraryBC.doc 4 QUINT & THIMMIG LLP SCOPE OF SERVICES OF BOND COUNSEL: (i) Consult and cooperate with officials of the City, City legal counsel, financing consultants, underwriters and other consultants, staff and employees of the City, and assisting such consultants, staff and employees in the formulation of coordinated financial and legal proceedings; (ii) Attend all meetings of the City Council and any administrative meetings at which any financing proceedings relating to the bonds are to be discussed, deemed necessary by for the proper planning of the financing proceedings or when specifically requested to attend; (iii) Prepare any required lease agreements, installment sale agreements, trust agreements, assignment agreements, agency agreements, amendments to existing financing documents, indentures, ordinances and all resolutions, notices and legal documents necessary for the proper conduct of the financing proceedings; (iv) Review all financial documents for legal sufficiency; (v) Review, without undertaking an independent investigation, any official statement or other disclosure document prepared in connection with the financing proceedings to assure correctness of disclosure relating to the legal documents; (vi) Prepare and provide a signature and no-litigation certificate, an arbitrage certificate and any and all other closing documents required to accompany delivery of the bonds; (vii) Prepare and provide a complete transcript of the proceedings necessary to accompany delivery of the bonds; (viii) Subject to the completion of proceedings provide a legal opinion that (if tax- exempt) the interest due with respect to the bonds is excluded from gross income for purposes of federal income taxation and that such interest is exempt from California personal income taxation; (ix) Subject to the completion of proceedings, provide a legal opinion approving in all regards the legality of all proceedings relating to the bonds; (x) Confer and consult with City officials and agents with regard to problems which may arise during the servicing and payment of principal of and interest on the bonds; (xi) Such other and further services as are normally performed by bond counsel in connection with the issuance of the bonds; and Quint & Thimmig Scope Page 1 of 3 (xii) Where election services are required, we will: (A) Prepare a timetable setting forth the actions required to be undertaken to accomplish the election, and coordination with the Santa Clara County election officials to insure that the necessary legal requirements are satisfied. (B) Prepare the resolutions and ordinances of the City Council required to call the election and to request consolidation with any other elections to be held on the same date. (C) Assist with the preparation of the tax rate statement and the independent analysis required to be distributed to voters. (D) Review the ballot arguments to be prepared by or on behalf of the City. (E) Consult with the City and its staff and counsel, Santa Clara County and its staff and the City's financing consultant concerning the election proceedings. (F) Prepare the notices, affidavits and certificates required by law for the conducting of the election. SCOPE OF SERVICES OF DISCLOSURE COUNSEL: (i) Prepare the official statement (both preliminary and final) or other disclosure documents in connection with the offering of the bonds; (ii) Confer and consult with the officers and administrative staff of the City as to matters relating to the official statement; (iii) Attend all meetings of the City and any administrative meetings at which the official statement is to be discussed, deemed necessary by us for the proper exercise of our due diligence with respect to the official statement, or when specifically requested by the City to attend; and (iv) Subject to the completion of proceedings to our satisfaction, provide a letter addressed to the underwriter of the bonds that, although we have not undertaken to determine independently or assume any responsibility for the accuracy, completeness or fairness of the statements contained in the official statement, in the course of our participation in the preparation of the official statement, we have been in contact with representatives of the City and others concerning the contents of the official statement and related matters, and based upon the foregoing, nothing has come to our attention to lead us to believe that the official statement (except for any financial or statistical data or forecasts, numbers, charts, estimates, projections, assumptions or expressions of opinion included therein, and information relating to The Depository Trust Company and its book-entry system, as to which we need express no view) as of the date of the official statement or the date of the closing contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Quint & Thimmig Scope Page 2 of 3 FEES FOR SERVICES: Based upon a proposed bond issue of between $9 and $14 million, Quint & Thimmig LLP would propose a combined bond counsel and disclosure fee of between $25,000 and $30,000. We normally seek reimbursement for actual out-of-pocket expenses incurred for shipping, delivery and courier service, photocopying, official transcript duplication and travel expenses for travel outside of California, however, as is the case for legal fees, such reimbursable expenses would also be entirely contingent upon the successful closing. Quint & Thimmig Scope Page 3 of 3