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HomeMy WebLinkAbout17- Redevelopment Agency E C O N O M I C D E V E L O P M E N T A G E N C Y OF THE CITY OF SAN BERNARDINO REQUEST FOR COMMISSION/COUNCIL ACTION From: TIMOTHY C. STEINHAUS Subject: CONSIDERATION OF INLAND Agency Administrator VALLEY DEVELOPMENT AGENCY REQUEST REGARDING DEFENSE, Date: February 9, 1993 FINANCE AND ACCOUNTING SERVICES PROPOSAL ------------------------------------------------------------------------------- Synopsis of Previous Commission/Council/Committee Action(s): None. ------------------------------------------------------------------------------- Recommended Motion(s): (Community Development Commission) MOTION: That the Community Development Commission consider, review and take action, as deemed appropriate, regarding the January 22, 1993 Inland Valley Development Agency (IVDA) request relative to the IVDA D nse, Finance and Accounting Services (DFAS) proposa TIMO . STEI US Agency Administrator ------------------------------------------------------------------------------- Contact Person(s) : Timothy Steinhaus Phone: 5081 Project Area(s) : Ward(s): Supporting Data Attached: Staff Report; IVDA Letter dated 1/22/93 FUNDING REQUIREMENTS: Amount: $ Source: Budget Authority: ------------------------------------------------------------------------------- Commission/Council Notes: ------------------------------------------------------------------------------- TCS:SWP:dle:lag:6038R COMMISSION MEETING AGENDA Meeting Date: 02/15/1993 Agenda Item Number: �� • E C O N O M I C D E V E L O P M E N T A G E N C Y OF THE CITY OF SAN BERNARDINO STAFF REPORT FEDERAL DEFENSE, FINANCE AND ACCOUNTING SERVICES WAS) PROPOSAL INCENTIVES On January 22, 1993, staff received a letter (attached) of the same date from the Executive Director of the Inland Valley Development Agency (IVDA). The letter requested the provision of incentives for the pending proposal to locate the subject departments satellite regional office in the City of San Bernardino on Norton Air Force Base properties. The request is for the acquisition of the Child Care Center or Non-Commission Officer (NCO) academy. Additionally, an inquiry is made about the Redevelopment Agency acting as a "stand by or back-up" to finance IVDA obligations relative to the proposal. It is appropriate for the Commission to consider the request. Staff recommends adoption of the form motion. TIMO TEI US, Administrator Economic Development Agency --------------------------------------------------------------- TCS:SWP:dle:lag:6038R COMMISSION MEETING AGENDA Meeting Date: 02/15/1993 r Agenda Item Number: r inland =nwa#ley AL. development agency k A regional Joint powers authority dedicated to tho rouse of Norton Air Force ease - for the economic benefit of the east valley .January 22, 1993 I Mayor W.R. 'Bob' Holcomb City of San Bernardino 300 N. 'D' St San Bemardlno, CA 92419 Dear Mayor Holcomb: Several items remain unfunded for our DFAS proposal. We are seeking funding from other sources to assist with this financial obligation and help to implement a proposal as we have enhanced it. We have requested that the County of San Bernardino consider the tease purchase of the PBX communication systems that would be provided for the DFAS facility. This$3 million request has been submitted directly to Jerry Eaves for his referral on to the Board. We indicated they could purchase this item over a period of ten years at an approximate annual cost of $400,000. Those funds could come from their share of the tax increment which Is quite substantial. We attached Dr. Husing's analysis when we proposed state partfcfpation and it Indicated that with a$25 million grant,the State would have recouped those funds In new taxes within two-and- one-half years. We did not do a similar calculation for the City of San Bernardino, but It Is likely that one could quite easily be accomplished, it would Involve a calculation of the secondary effect of the sales tax and other taxes such as utility tax and property tax for those DFAS employees that were located within the City of San Bernardino. Specifically, I am requesting that the City of San Bernardino consider the acquisition of either of the following items: 1. The Child Care Center Cost approximately $1,100,000. This Is just an estimate, but it is based on reproduction cost. This could be acquired with 25 percent down and retired over the remaining ten years, principal and interest. The Air Force has Indicated they are willing to sell property in that manner. 2. The NCO Academy The NCO Academy is estimated to cost $1.7 million. This could be purchased with 25 percent down, interest and principal due over the remaining 10 years. 772 201 North'E'Street,3rd Floor,San Bernardino,California 92401-1507 714/88;5-IVDA FAX 714/386.7591 ^^— D;-Id T©Dt T9U9-t73-b TL.:ON 731 OhlQH N d0 AI I :Q I T t-0 T 26.-Est-;33d / r FEB—O3-193 10:41 IU=CITY OF S1AM.BUNO TEL N0:714-384-5461 #301 F 3 Mayor W.R. 'Bob" Holcomb January 22, 1993 Page Two The most critical of the two requirements Is the Child Care Center. If this Center were acquired by the City of San Bernardino,it could undoubtedly be operated with funding from various City, County, and State funding programs. It could also manage through a franchise operation with a private operator. We've indicated that we would subsidize the cost to DFAS employees at a rate of approximately 50 percent of the prevailing cost. The facility accommodates 240 children and hence, the total operational cost could be spread among all participants, DFAS and others. I will be more than happy to meet with you and anyone you designate to discuss these items In further detail. I hope that we may move to a quick resolution so that we may continue with our enhanced DFAS proposal. The folknving is a new topic but deals with the same subject: The DFAS Proposal. Tim Steinhaus will recall that during the DFAS Team visit, there was a question regarding the abliity of IVDA to fund the tax Increment obligation being proposed. One of the participants indicated that the IVDA was a relatively new organization and that it had lacked a long-term track record of being We to finance these types of obligations. In response to that, Tim Stainhaus and I indicated that we could approach the Redevelopment Agency In the City of San Bemardino and they could give a back up position indicating that they would stand behind or buy any obligation issued by the IVDA. I am aware that similar types of stand-by or back-up positions have been taken by the Redevelopment Agency In the past. We believe that it is very unlikely that we would ever need to call upon the Cfty Redevelopment Agency for a back-up position, but with respect to getting by the proposal stage, It would Indicate that where there is solid support behind any bond proposals for the DFAS project. Please review the subject request and call me at your earliest convenience so that we may discuss them. i would suggest that Tim Steinhaus and Tim Sabo be present in order to work out any arrangements that might be necessary. Your consideration of these items will be sincerely appreciated. Sincerely, 46'1 Zam L Kopf Executive Director Inland Valley Development Agency Enclosure: Dr. Husing's State Assistance Analysis c. Tf1MMY G S rMaas.AQancy Adminle AIW COY d Sm ROMMUM4 EWg0m10 Oavdopmwt Agency 772 �A FEP7219-'93 10:42 IU:C:TY OF 'SAN BUNO TEL NO:714-384-5461 #301 F; 4 s .Ago, mot TO: Defense Finance g Accounting Service Committee FROM: John V. Rusing SUBJECT: State Assistance DATE: December 4, 1992 This analysis Iaaks at the impact of having the State t�i]It°h local offer to DPAS,thus releasing the local mariies for additional subsidies to sweeten the deal. For lower state subsidies, the FaY for the original idles Iese' pact would be :lies p�portionatel s Note that a 125.8 tttillian state subsidy Years worth of added state sales would be repaid from st lithe more than collections from the project and Income tax IB, 16. 4,000 direct now fobs plus 14,348 secondar 1d- state income would rise b _ y fobs means new fobs. field a sales. kith a 5-5% salesOtax ate el pin= $119,078,855 in additional Yield an�ausj sales taxes of &a& going to the state, this would 17• Asssuming, primary families make $30,000 a make the slats madian of #2Z,p34 : Year and secondary families would annually rise by fear, state income tax collections 1s• Total annual state budget impact, Sales atr►d Tncame fazes: This is ■ tittle over a Y year pay back on its investment. _� R ESI 19- in annual new local tconomic activitl would occu IM of the Norton p�eout. r, Offsetting 20. The local labor force would be increased b And 86182 ihdirect. Of these, 86431 would be Ae�fobs: 4,000 direct local )d"S. ..� 14AJ4' pti�,riT��f �£. ��u�� go�r��N a. Gt�►'�opF 1- �S"43 i r/ FEB-435-'93 10:43 ID:CITY OF SPN BUNO TEL N0:714-304-5461 #301 P05 -- • n ` � ! 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NAME " './ FIRM__ FAX NUMBER PHONE NUMBER FROM PHONE NUMBER (909) 384-5081 SUBJECT NO. OF PAGES, INCLUDING COVER PAGE:_ I--,' COMMENTS:__ `1 '' IF YOU DO NOT RECEIVE ALL THE PAGES AS INDICATED, PLEASE CALL THE SENDER AS SOON AS POSSIBLE. Toll-Free (800) 232-1267 *201 North E Street, Third Floor•San Bernardino,Calitomia 92401-1507•(909) (909) �749 384-5081•FAX"384.5135 l f /